Understanding Employment Contracts in South Africa

Suspensive Conditions

A suspensive condition is a provision that must be fulfilled before the contract (or a specific obligation within it) comes into existence.

• Example: An employer offers a candidate a job on the condition that they pass a mandatory medical examination. If the candidate fails the medical test, the condition is not met, and the contract is never formed.

Resolutive Conditions

A resolutive condition is a provision that, once fulfilled, brings the contract to an end.

• Example: A fixed-term contract that automatically terminates upon the completion of a specific project.

Exam Tip: Be careful with resolutive conditions. They cannot be used to circumvent labor laws. For instance, an employer cannot use a resolutive condition to terminate a contract specifically because an employee becomes pregnant, as this would violate statutory protections.

Restraint of Trade Clauses

A restraint-of-trade clause is a provision intended to protect an employer's protectable interests. These interests typically include trade secrets, confidential business information, customer goodwill, or specific business connections that would be harmed if an employee joined a competitor.

However, these clauses are not absolute. To be enforceable, they must be reasonable. A court will generally not enforce a clause that simply seeks to prevent an employee from using their general skills and experience to earn a living; the employer must prove that the restraint is necessary to protect a legitimate interest.

Changes to Terms and Conditions

One of the most common areas of dispute in the workplace is the modification of employment terms. It is vital to distinguish between working arrangements (which an employer may often change, such as shifting schedules) and the actual terms and conditions of employment.

An employer cannot make a unilateral change to the terms and conditions of employment. Attempting to do so constitutes a breach of contract, specifically known as repudiation. Lawful changes to these terms can only occur through the following channels:

1. Mutual agreement between the employer and the employee.
2. Collective agreements reached with recognized trade unions.
3. Operation of law, such as when new legislation (like an amendment to the BCEA) changes the legal minimums.
4. Sectoral determinations issued by the Minister.

Workplace Customs and Practices

Beyond the written word, the employment relationship is also shaped by workplace customs, traditions, and practices. Over time, certain ways of working that are consistently applied and accepted by both parties can acquire a legal status similar to contractual terms. While the written contract is the primary authority, these established practices can influence how disputes are interpreted and how the "standard" of the workplace is defined.