The contract of employment must be in writing or can be inferred from the parties’ conduct in appropriate circumstances. The contract of employment obviously depends on compliance with the normal requirements for valid agreements. At common law the parties are in principle free to determine the terms and the form of their relationship. The parties are usually free to determine the terms and the form of their relationship. The employee typically will be in a weaker bargaining position which allows the employer to determine the content and form of the relationship almost unilaterally. Employer can choose between a contract of employment and a contract of rendering services.

A contract of employment allows the employer to determine matters such as duration, payment system, length of working hours, and place of employment. The employer’s choice of employment relationship is largely unfettered but there are some statutory limitations to that freedom. Employment may be limited for health and safety reasons.

The sources of the employment contract

There are many sources. The common law constitutes the broad foundation of the employment relationship and allows parties to determine the content of their relationship for themselves while employment legislation limits their power by setting out minimum terms of employment. The legislature recognised that the common law position is quite unrealistic and employees are generally in a more vulnerable position. It creates a self-government which is a structure for collective bargaining between employers and trade unions. Free collective bargaining takes precedence over the BCE in certain circumstances but also over certain provisions of certain individual contracts of employment

A contract may be entered into verbally or by conduct. If parties fail to provide expressly for a particular contingency, statute; collective agreements, custom and practice and the common law will fill the gap. Section 29 of the BCE requires the employer to provide the employee with some written particulars of employment when the employee commences working. Common law implies the following terms on the employee’s side; duty of obedience to the employer’s lawful ad reasonable instructions, duty of fidelity, duty of care, duty of reasonable efficiency or competence. Terms implied by legislation are mostly prescriptive in nature and is an attempt to incorporate law into a command and subordination relationship. The substantive content of employment relationships in the private sector is determined to a large extent by primary legislation. These norms are important as parties cannot receive less than the minima set out in the statute.

The content of the individual employment relationship

The rights and obligations of employee and employer derive from a number of sources. In order to determine the exact content of the contract, look at the agreement itself against custom and practice, the standard common law terms, statutory measures and collective agreement.

The employee’s duties

The service: the employee’s main obligation is to make her/his services available to the employer from the agreed date and for the duration of the contract. The employee’s entitlement to remunerations generally dependant on the availability of her/his services to the employer and not on the actual rendering of those services. An employer is normally not obliged to provide the employee with work, employee can also not be compelled to render services other than those that were contemplated at the time of contracting unless employee agrees to a variation of terms. A unilateral amendment of the terms of employment by the employer constitutes a repudiation of the contract which entitles the employee either to hold the employer to the existing terms or where the breach is quite significant, can cancel and sue for damages. All termination must take place peacefully. At common law, the refusal to work by an employee constitutes a breach of contract that allows the employee to dismiss without notice.


An implied term of every employment contract that employees must generally exercise due diligence and skill in the fulfilment of their duties. The facts of the case determine whether the employer can dismiss through the common law. It is generally accepted that the breach must be serious or persistent to justify summary dismissal.

Good faith

The employment relationship must have moral content and the employee’s obligation is to serve honestly and faithfully. The employee must further the employer’s business interests and avoid a clash between his/her personal interests and those of the employer. Dishonesty or any conduct that undermines the trust and confidence in the employment relationship entitles the employer to summary judgment under the common law.


The submission to the employer is the essence of the employment relationship. The employee must obey the employer’s lawful commands. The employee must be respectful towards the employer and her/his superiors. If the instructions of the employer fall outside of the scope of the employee’s  contractual duties, if they are contrary to the provisions of any legislative measure, or if they are contrary to the dictates of public policy. A refusal to obey a lawful instruction justifies a summary dismissal if it is deliberate and of a serious nature.

The duties of the employer

Appointment and engagement: do discriminatory hiring practices may be used, other than that the employer has the right to determine the appointment of employees.


This is an important element of the employment contract. Common law says that it can be in cash or kind or partly in cash or kind. Remuneration becomes payable only at the end of the contract period unless the parties have agreed otherwise. Where the employee’s services are not available to the employer, the latter is relieved of the obligation to remunerate the employee; i.e. no work, no pay.

An employee who partake in a strike does not suspend the operation of the contract of employment altogether.  Only the wage-work bargain is suspended in the sense that the employer need not pay the strikers their wage and other subsidiary benefits while the strike is in progress. The withdrawal of labour which accompanies a strike remains a serious breach of contract in the eyes of the common law and would entitled the employer to terminate the contract. The Constitution entrenches the right to strike and in terms of the LRA, an employer cannot dismiss striking workers who have complied with certain required procedures set out in the Act.

The common law prohibits unilateral deductions from an employee’s wages, but allows for deductions by consent. Non-payment or underpayment of the agreed remuneration constitutes a breach of contract for which the employee may pursue the ordinary contractual remedies. The BCE also prohibits unilateral deductions from an employee’s wages and establishes a procedure, for those within the threshold determined by the Minister. The Labour Court has held that employees earning remuneration that falls within that threshold must follow the procedure, which leads to the issue of a compliance order by a labour inspector. An employee earning more than the prescribed amount may not follow this procedure and may sue the employer for non-payment.

Safe working conditions

No duty on the employer to furnish the safest machinery or to provide the best possible means for its operation. The common law merely requires an employer takes reasonable care for the safety of its employees. The employer’s liability for work-related injuries will lie in delict and employer just act as a diligens paterfamilias.  

Provision for leave

The employer is not obliged to grant an employee vacation, sick or occasional leave unless expressly agreed otherwise according to common law. Legislation has altered the common law position quite a lot. The BCEA provides for minimum leave requirements.


Other things include making contributions to unemployment insurance fund keeping certain prescribed records, the provision of a certificate of service and so on. The employer is jointly and severally liable with an employee where employee commits a wrongful act in the course and scope of her/his duties.

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