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Basic Conditions of Employment Act

Regulation of Working Time and Earnings Threshold exclusions                    Page 1 of 4

Basic Conditions of Employment Act

  1. Chapter Two: Application of this Chapter

Section 6:

Sub Section (1)-

"This Chapter except section 7, does not apply to-

(a) senior managerial employee;
(b) employees engaged as sales staff who travel to the premises of
customers and who regulate their own hours of work;
(c) employees who work less than 24 hours a month for an employer."

The sections that do not apply to the above employees are:
Section 8 Interpretation of day;
Section 9 Ordinary hours of work;
Section 1 0 Overtime
Section 11 Compressed working week;
Section 12 Averaging of hours of work;
Section13 Determination of hours of work by Minister;
Section 14 Meal intervals;
Section 15 Daily and weekly rest period;
Section 16 Pay for work on Sundays;
Section 17 Night work;
Section 18 Public holidays

Section 7, Regulation of working time, however does apply.

A senior managerial employee is defined in the Act as:

"senior managerial employee" means an employee who has the
authority to hire, discipline and dismiss employees and to represent the
employer internally and externally. (my emphasis)

In order for an employee to be classed as a senior managerial
employee, regardless of his or her job title, the employee must;

(1) have the authority to;
1.1 hire employees;
1.2 discipline employees;
1.3 dismiss employees;
1.4 represent the employer internally;
1.5 represent the employer externally.

If for example, the employee has the authority to hire and discipline an
employee, but lacks the authority to dismiss an employee, such

 

Regulation of Working Time and Earnings Threshold exclusions                   Page 2 of 4

employee is not a "senior managerial employee" for the purposes of
the Act. The provisions of Chapter two will therefore apply.

Like wise, should the employee have the authority to hire, discipline
and dismiss an employee, but does not have the authority to represent
the employer internally or externally, such employee is not a "senior
managerial employee" for the purposes of the Act.

1.Earnings threshold determined by Minister

The Minister, in terms of section 6(3) of the Basic Conditions of
Employment Act, in Government Notice GNR 100 dated 1 February
2008 determined that all employees earning in excess of R149736.00
(R12478.00 per month) be excluded from the following sections of the
Basic Conditions of Employment Act;

Section 9                    Ordinary hours of work;
Section 10                 Overtime;
Section 11                 Compressed working week;
Section 12                 Averaging of working week;
Section 13                 Determination of hours of work by Minister;
Section 14                 Meal intervals;
Section 15                 Daily and weekly rest period;
Section 16                 Pay for work on Sundays;
Section 17                 Night work;
Section 18(3)             Public holiday remuneration in respect of the
sub-section only.

Sections 7 and 8, however, apply.

In MONDI PACKAGING (PTY) LTD v DEPARTMENT OF LABOUR &
OTHERS (2008) 29 ILJ 371 (LC) the court examined the correct
method of calculating an employee's' gross earning' for the purpose of
determining whether he fell within the threshold set for payment of
overtime in accordance with s 6 of the BCEA 1997. The Court found
that, having regard to the social imperatives underpinning the Act, the
legislature could not have intended a literal interpretation of the Act,
which would have included overtime in the calculation og 'gross
earnings'. This would lead to unfairness and uncertainty for the
employee. A purposive interpretation was therefore adopted which
excluded overtime from the calculations.

A word of caution, employers must not interpret this to mean, because
an employee earns more than the threshold and is excluded from the
sections mentioned above, an employee can be forced to work any
number of hours of normal time that the employers requires, and that
the employee can be forced to work any amount of overtime, including
Sundays and public holidays without any remuneration or
compensation whatsoever. That is certainly not the case.

MICMA & Associates                                           Service 1/2007 revised 2008

 

Regulation of Working Time and Earnings Threshold exclusions                   Page 3 of 4

Sections 7 and 48 of the Basic Condition of Employment Act covers all
employees, and states:-

"7. Regulation of working time. - Every employer must regulate the
working time of each employee-

(a) in accordance with the provisions of any Act governing
occupational health and safety;
(b) with due regard to the health and safety of employees;
(c) with due regard to the Code of Good Practice on the
Regulation of Working Time issued under section 87(1 )(a);
and
(d) with due regard to the family responsibilities of employees."

"48. Prohibition of forced labour. - (1) Subject to the Constitution,
all forced labour is prohibited.

(2) No person may for his or her own benefit or for the benefit of
someone else, cause, demand or impose forced labour in
contravention of subsection (1).
(3) A person who contravenes subsection (1) or (2) commits an
offence."

  1. What does this mean

The meaning of the exclusion is purely and simply that an employee
earning above the threshold cannot demand to be paid for overtime
worked or for excessive hours worked, as he or she has no legal
entitlement to demand such payment.

The employer cannot force the employee to work overtime simply
because the employee is not in a position to demand compensation for
it. Section 48 of the Act protects the employee against forced labour.

The employee still has the right to refuse to work in excess of normal
time and refuse to work overtime if the employer is not prepared to
compensate.

The situation therefore is, that employees earning above the threshold
must negotiate their normal working hours and overtime hours with the
employer, and they must negotiate the rate of payor compensation for
overtime hours worked.

This also applies to the so called senior managerial employee.

4. Implementation

Employers who wish to invoke the above must tread warily, for due
regard must be had for the provisions of any existing contract of
employment, which may entitle the employee to provisions that in

MICMA & Associates                           Service 1/2007 revised 2008

 

Regulation of Working Time and Earnings Threshold exclusions                  Page 4 of 4

terms of the above are now excluded. Should this be the case, the
terms of the employment contract will prevail, unless the employer and
employee have negotiated a new contract of employment incorporating
the exclusions, with due regard to sections 7 and 48 above.

Any unilateral implementation of the above by employers can be seen
as a repudiation of the employment contract by the employer, and the
employee will be able to institute proceedings for an unfair dismissal
dispute, bearing in mind the employee's constitutional right to fair
labour practices.

In ERASMUS & OTHERS v SENWES LTD & OTHERS (2006) 271LJ 259 (T)
the Court held that where a contract of employment provided that the
employer could amend terms without notice to or consent of employees, the
employer's power to amend its own contractual obligations was not unfettered
- employees' constitutional right to fair labour practices - Court to enforce
rather than to invalidate contractual obligations. Although this case deals with
the employer subsidising medical aid to retired employees, the principle that
an employer may not unilaterally implement changes to terms and conditions
within an employment contract, applies.

 

MICMA & Associates Service                 1/2007 revised 2008

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