South Africa Labour Law Changes 2025
Employers in South Africa need to be ready to implement the new labour law regulations for their employees in 2025
In this article, we will delve into the 2025 labour law changes for employers in South Africa. Let’s understand the key updates and amendments in the new labour laws that are expected to impact employers across various sectors.
These amendments include areas such as health & safety regulations, employment conditions, labour appeals processes, and a new employment equity code.
Here’s what employers need to know to stay compliant and adapt to the new regulations across South Africa.
National Minimum Wage Increase
Effective 1 March 2025, South Africa’s National Minimum Wage (NMW) has risen from R27.58 to R28.79 per hour, encompassing farm and domestic workers. Participants in expanded public works programs now earn R15.83 per hour, up from R15.16. Learners under Section 17 of the Skills Development Act are entitled to updated allowances as specified in the latest government schedule.
Employers must ensure all employees receive at least the applicable NMW. It’s important to note that certain remuneration categories such as in-kind payments, tips, bonuses, gifts, and specific allowances are excluded when assessing compliance.
Non-compliance may result in fines, potentially double or triple the underpayment amount or the employee’s monthly wage, depending on the offense’s recurrence. The Department of Employment and Labour will publish quarterly lists of employers issued with compliance orders.
Occupational Health and Safety Regulations
As of 6 March 2025, new Occupational Health and Safety Regulations have been enacted, including the Physical Agents Regulations, Noise Exposure Regulations, and amendments to the General Safety Regulations.
These apply to employers and self-employed individuals whose work may expose persons to physical agents or noise levels at or above specified limits. Employers are required to conduct risk assessments, implement monitoring programs, and provide appropriate training to affected employees.
Failure to comply with these regulations may lead to penalties, including fines or imprisonment for up to 12 months. Specific provisions outline offenses and corresponding penalties to ensure workplace safety standards are upheld.
Increase in Earnings Threshold
From 1 April 2025, the annual earnings threshold under the Basic Conditions of Employment Act has increased from R254,371.67 to R261,748.45.
Employees earning above this threshold are excluded from certain provisions of the Act, including those related to ordinary hours of work, overtime, and rest periods.
Employers must ensure that employees earning below the threshold receive all applicable rights and protections under the Act.
Implementation of Court Online Portal
Effective 14 April 2025, all new matters in the Labour Court and Labour Appeal Court must be initiated via the Court Online electronic portal.
This platform facilitates electronic filing of documents, case management, and communication with the courts, aiming to enhance efficiency and accessibility in the litigation process.
Employers and their legal representatives must ensure compliance with this directive to avoid procedural issues.
New Employment Equity Regulations and Sectoral Targets
On 15 April 2025, new Employment Equity Regulations came into effect, repealing the 2014 regulations. These regulations provide guidance on ensuring equal pay for work of equal value and outline the duties of designated employers, including the development and implementation of Employment Equity Plans.
Additionally, sector-specific numerical targets have been introduced for designated employers, requiring them to achieve specified representation levels across various occupational categories. Non-compliance may result in fines, particularly if employers fail to prepare or implement an Employment Equity Plan or cannot justify deviations from the set targets.
From 1 January 2025, the definition of a “designated employer” under South Africa’s Employment Equity Act (EEA) will be updated. Currently, this includes businesses with more than 50 employees or those exceeding a specific annual turnover, depending on their sector.
However, the amended definition will remove the turnover threshold. Going forward, only companies with more than 50 employees will be considered designated employers. As a result, smaller businesses with fewer than 50 employees will no longer be required to develop employment equity plans or submit annual equity reports.
This change is aimed at easing regulatory pressure on small businesses.
Sector-Specific Target Numbers For Equity
The Minister of Employment and Labour will be able to set sector-specific numerical targets to promote fair representation of designated groups, namely Black (African, Coloured, and Indian) South Africans, women, and persons with disabilities, across all occupational levels. Although draft targets have been circulated, the final figures have yet to be confirmed.
The sectoral numerical targets, published under section 15A of the Employment Equity Act are designed to promote fair representation of suitably qualified individuals from designated groups across all levels of the organisation. These targets do not add up to 100%, as they exclude foreign nationals and white men without disabilities.
This links directly to changes in how employment equity plans are developed. Previously, designated employers could set their own targets using national or regional demographics and the availability of qualified candidates.
Under the revised system, their targets must now align with those prescribed by the government for each sector. To qualify for a certificate of compliance, which is required to do business with the government, designated employers will need to meet these sector targets or be able to justify why they haven’t.
One further clarification has been added to consultation rules. Where a workplace has a recognised trade union, the employer is required to consult with the union only. There is no separate obligation to consult with employees directly.
Amended definition of People with Disabilities
The definition of “people with disabilities” has also been updated to reflect a more inclusive approach. It will now cover long-term or recurring physical, mental, intellectual, or sensory impairments that, when combined with external barriers, significantly affect a person’s ability to access or progress in employment.
Another change removes the previous requirement for psychological tests and similar assessments to be certified by the Health Professionals Council of South Africa. This step is no longer needed for such assessments to be valid.
More power given to labour inspectors
Labour inspectors have been given greater authority. They can now request written undertakings from designated employers to confirm they have consulted with employees or unions, conducted the necessary equity analysis, published their reports, and assigned responsibility to senior managers.
Compliance and submission of Equity Reports
The Minister is also now authorised to set the rules for how compliance orders will be delivered to designated employers. In addition, the fixed deadline for submitting equity reports has been removed. Instead, submission requirements and timelines will be outlined through new regulations. Lastly, designated employers will now submit income differential statements to the National Minimum Wage Commission rather than the Employment Conditions Commission.
Designated employers are now required to prepare and implement Employment Equity Plans (EE Plans) that span a fixed five-year period From 1 September 2025 through to 31 August 2030. These plans must reflect the sector-specific numerical targets issued by the Minister of Employment and Labour. In cases where an employer operates across multiple sectors, the targets applicable to the sector employing the largest portion of their workforce will apply.
When setting annual employment equity targets, employers must ensure representation of designated groups across the four upper occupational levels. These targets should take into account the sector-specific requirements and the economically active population (EAP), including job seekers. Where any group is already over-represented relative to the EAP in a given occupational level, care should be taken not to extend this imbalance further.
Developing a compliant EE Plan involves considering a number of factors, such as the employer’s current workforce profile, the relevant EAP statistics, sector targets, job requirements, the pool of qualified candidates, staff turnover rates, and internal recruitment and promotion trends. If targets are not met, employers will need to provide a valid explanation, for example, a shortage of skills, limited recruitment opportunities, or financial constraints.
Employers must continue submitting their annual equity reports (EEA2 and EEA4). These can be submitted in person by the first working day of October or online through the Department of Employment and Labour’s website by 15 January.
A notable addition to the compliance process is the Employment Equity Compliance Certificate, which is now mandatory for all businesses looking to work with the State. This certificate, valid for one year, can be applied for online after the employer’s equity report has been submitted. If the certificate was obtained through false information or if a condition on which it was granted changes, the Department can withdraw it—though only after following due process.
Other proposed changes and reforms
Ongoing discussions at the National Economic Development and Labour Council (NEDLAC) between government, organised labour, and business have resulted in a set of proposed amendments aimed at updating South Africa’s labour laws.
These proposals include 47 changes to the Labour Relations Act (LRA), 13 to the Basic Conditions of Employment Act (BCEA), two to the National Minimum Wage Act (NMWA), and three to the Employment Equity Act (EEA).
Exemptions for small and new businesses
Another proposed change aims to support newer, smaller enterprises. Businesses with fewer than 50 employees and less than two years of operation could be exempt from collective bargaining agreements extended via bargaining councils. However, this exemption would not apply to businesses formed through transfers or restructuring.
Trial periods and probation
Another proposed amendment introduces a formal qualifying period during which unfair dismissal protections would not apply. For the first three months (or a longer, contractually agreed and justified probation period), employees could be dismissed without being able to claim unfair dismissal, unless the reason falls under the category of automatic unfair dismissal. The aim is to make it easier for businesses to offer opportunities, especially to young or inexperienced workers.
Increase in statutory severance pay
If these proposals are adopted, statutory severance pay following retrenchment would increase from one to two weeks of remuneration per completed year of service. However, this enhanced entitlement would only apply to years worked after the amendments take effect.
Broadening the definition of 'Employee'
A new schedule proposes extending labour protections to workers who may not fall under the current definition of “employee” in section 213 of the LRA. This expanded definition includes individuals doing personal work for someone who isn’t a client or customer, such as platform workers (e.g. ride-hailing or delivery drivers). The presumption of employment would apply unless an employer can show otherwise.
Similar updates are proposed for the BCEA, enabling the Minister to set basic employment standards for this group through sectoral determinations.
Regulating on-call and seasonal workers
Proposed changes to the BCEA would require employers to provide clarity to on-call or seasonal workers regarding expected availability. This includes written notice outlining the timeframes for being called to work and for any cancellations, both of which must be reasonable.
Limiting remedies for unfair dismissal of high-earning employees
One key proposal introduces a cap on compensation for unfair dismissal cases involving high-income earners. Only employees dismissed for reasons classified as automatically unfair would be entitled to reinstatement. All other cases would be eligible only for limited compensation. For the 2024–2025 period, the income threshold defining “high-earning” stands at R1.8 million annually and will be adjusted each year in line with inflation.
Clarifying fair dismissal procedures
A proposed update to the LRA seeks to clarify what constitutes procedural fairness in dismissals. It stipulates that, unless a collective agreement states otherwise, a fair process involves giving the employee a fair and reasonable opportunity to respond to the reasons for their dismissal. This aligns with current best practices and recent draft codes promoting more accessible and less adversarial processes.
Retrenchment and procedural reforms
The draft bills include changes to section 189A of the LRA, which governs large-scale retrenchments. The Commission for Conciliation, Mediation and Arbitration (CCMA), rather than the Minister, would have the authority to issue rules regarding facilitation procedures. Also, the requirement for urgent applications during retrenchment processes would be removed, allowing affected employees to challenge procedural fairness only after dismissal. Additionally, if a facilitated process has taken place, disputes can go straight to the Labour Court without prior conciliation.
Narrowing the scope of unfair labour practices
The definition of unfair labour practices is also under review. It is proposed that only unfair suspensions, disciplinary actions short of dismissal, and retaliatory action against whistleblowers remain covered. Promotion-related disputes will be excluded, though a one-year grace period is planned for public sector employers and certain categories like educators and police, giving them time to adapt through collective agreements.
How Beyond Borders HR Can Help You
These 2025 employment legislation changes for South Africa can be challenging for employers to process independently. Beyond Borders HR, a global HR consulting firm, stands ready to assist businesses in understanding and implementing these changes effectively.
With our extensive expertise in global HR practices, we ensure that your organization stays compliant with the evolving regulatory landscape. Reach out to Beyond Borders HR for tailored solutions, expert guidance, and seamless integration of these legislative updates into your HR policies and practices.
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