South Africa

Contract Types             

Contracts in South Africa can be full-time, fixed-term, part-time or indefinite. 

Probation

The maximum length of probation is not specified in law but must be reasonable given the circumstances of the job. Usually, probation is 3 months. 

Working Hours             

Normal hours are 45 hours per week. An employee can work up to 9 hours per day if they are employed on a 5-day week contract. If the employee is working a 6 day week, then the workday consists of up to 8 hours. 

Overtime

No more than 10 hours per week which must be agreed upon. 15 hours for a 2 month period during a year can also be agreed on. Overtime is paid at 150%, or paid time off in lieu, or a combination of both. 200% is payable for working on Sundays. Those earning over ZAR 205,433.30 pa are not entitled to overtime; for those earning less than this overtime must be paid and the salary cannot already include overtime.

Other Financial

A 13th month bonus is not required by law but is considered a gratuity and is common, usually paid in December. Performance based bonuses are also common and are usually based on a percentage of the employee’s salary or paid as a lump sum to the department and split equally between the employees. 

Other

No set pay date, payroll can be monthly, weekly, or bi-weekly. 

Tax rates valid for 2023-4

Corporation Tax           

27% on worldwide income

Different rules apply to small businesses and certain industries.         

Employers’ Social Security (UIF and Skills Levy)      

2%        

UIF (1%) Limited to ZAR 212,544 per employee pa

Additionally, employers must contribute to the COIDA fund. Rates depend on the sector              

Employees’ Contributions

1%        

Limited to ZAR 212,544 per employee pa

Income Tax Rates        

Up to 237,100 ZAR – 18%

237,100 to 370,500 ZAR – 26%

370,501 to 512,800 ZAR – 31%

512,801 to 673,000 ZAR – 36%

673,001 to 857,900 ZAR – 39%

857,901 to 1,817,000 ZAR – 41%

1,817,001 ZAR and above – 45%

Notice

1 weeks’ notice if the employee has been employed for up to 6 months 

2 weeks’ notice if the employee has been employed for 6 to 12 month 

4 weeks’ notice for over 12 months’ service

A collective agreement may permit the required notice period of 4 weeks for employees who have worked more than 12 months to be reduced to no less than 2 weeks. 

Severance Pay

An employee who is dismissed for reasons based on operational requirements or whose contract is terminated on account of insolvency is entitled to pay at a rate of 1 week of pay for each year of service completed. No severance pay is due in cases of resignation, retirement, death, expiration of contract, dismissal for misconduct, poor performance, illness, or other similar reasons. Contracts will usually state any severance due.

National Public Holidays: 12 

2024 Date        

New Year’s Day – 1st January               

Day Given in Lieu: Yes, if Sunday

Human Rights Day – 21st March

Day Given in Lieu: Yes, if Sunday

Good Friday – 29th March        

Day Given in Lieu: NA

Family Day – 1st April

Day Given in Lieu: Yes, if Sunday

Freedom Day – 27th April

Day Given in Lieu: Yes, if Sunday

Workers’ Day – 1st May 

Day Given in Lieu: Yes, if Sunday

Youth Day – 16th June               

Day Given in Lieu: Yes, if Sunday

National Women’s Day – 9th August

Day Given in Lieu: Yes, if Sunday

Heritage Day – 24th September

Day Given in Lieu: Yes, if Sunday

Day of Reconciliation – 16th December

Day Given in Lieu: Yes, if Sunday

Christmas Day – 25th December

Day Given in Lieu: Yes, if Sunday

Day of Goodwill – 26th December

Day Given in Lieu: Yes, if Sunday 

Comment        

When the holiday falls on a Sunday, the following Monday shall be a holiday. 

Paid legal leave entitlement

15 business days off per year, or 1 day for every 17 days worked, or 1 hour for every 17 hours worked. 

Employees must be paid in full for their leave before the leave period starts.

Carry over permitted

Leave may be carried over.

Sick     

The sick leave cycle is a period of 36 months of employment with the same employer. The employee is eligible to take the number of days they would normally work in a 6 week period for sick leave on full pay within the 36-month cycle. During the first 6 months of employment, employees are entitled to 1 day of paid leave for every 26 days worked. After 6 months, a balance of 30 days (for a 5 day week) or 36 days (for a 6 day week) is available, less any days taken in the first 6 months. At the end of the cycle, unused days will be forfeited. A sick note must be provided after two days of absence.

Maternity         

Maternity leave in South Africa is 4 consecutive months of leave, which starts 1 month prior to the due date. Social Security pays 60% of salary for 121 days for eligible individuals.

Adoption and Surrogacy

In cases of adoption of a child under 2 years of age, 10 weeks’ leave is available to one parent. This also applies to parents who have commissioned a surrogate. The other parent can avail of parental leave.

Parental            

10 calendar days’ leave paid by Social Security at 66%. Employees must inform the employer in writing at least one month before the expected due date. This leave also applies for adopting parents. 

Paternity

South African paternity leave is for 10 days and is unpaid. A minimum of one month’s notice should be given by the employee.

Study  

At the employers’ discretion, an employee who is undertaking studies can take 2 paid days per subject per year with a maximum of 10 days. After 10 days, leave is unpaid.

Other  

Employees are entitled to 3 days of family responsibility leave for each 12-month period from the start of employment after 4 months’ service. This can be used for the birth of a child, sick children, or the death of a family member. Leave expires at the end of each annual cycle and unused family leave cannot be carried over.

Medical Benefits          

Private medical insurance is commonly provided for employees and family members often via an allowance.

Life Insurance

Life insurance covering a death benefit of 1 to 3 times annual salary (twice annual salary being the most common) is sometimes offered. Such policies often include accidental death and total permanent disability clauses.

Pensions           

Private pensions are not commonly provided except by large companies, or multinationals, and when they are provided, they tend to be limited to management and/or senior executives.