South Africa’s labour law framework could soon undergo one of its most significant revisions in years, with proposals that would reshape dismissal procedures, increase retrenchment costs, and extend workplace protections to new categories of workers.
The Labour Law Amendment Bill, 2025 – published for public comment – introduces sweeping changes that employers, labour practitioners, and human resources professionals will need to study closely.
The Bill, released on 26 February, proposes amendments to the Labour Relations Act (LRA), Basic Conditions of Employment Act (BCEA), Employment Equity Act (EEA), Unemployment Insurance Act, and the National Minimum Wage Act.
Legal specialists say the Bill combines stronger worker protections, major changes to dismissal law, and tighter compliance obligations for employers. Several of the proposals are also likely to become flashpoints during the legislative process.
Dismissal law set for major overhaul
Some of the most far-reaching changes are proposed in relation to dismissal law.
The Bill would amend the LRA to clarify what constitutes a fair procedure in dismissals for misconduct or incapacity. Instead of relying mainly on case law and the Code of Good Practice, the Act itself would provide that a dismissal is procedurally fair if the employee was given an adequate and reasonable opportunity to respond to the reason for dismissal.
Imraan Mahomed, director of employment law at Cliffe Dekker Hofmeyr, said the amendment reflects a broader shift away from internal disciplinary processes that mimic court proceedings. He said many employers have already moved towards simpler procedures aligned with the Code of Good Practice on Dismissal published in September 2025.
Talita Laubscher and Chloë Loubser of Bowmans say the amendment formally endorses that shift. They note, however, that the simplified standard remains subject to collective agreements, meaning employers will still have to follow more detailed procedures where these have been agreed.
The Bill also introduces what some practitioners describe as a “run-in period” before employees acquire full protection against unfair dismissal.
Under a proposed section 188(4), the protection against unfair dismissal would not apply during the first three months of employment, or during a longer probation period if that period is specified in the contract and is both reasonable and operationally justifiable.
Mahomed said this effectively introduces a qualifying period for dismissal protection and brings South African labour law closer to international practice. Bowmans notes that employees would still be protected against automatically unfair dismissals, but otherwise their contracts could be terminated on notice during this period.
Another major proposal limits the remedies available to high-income employees. At present, reinstatement is the primary remedy for unfair dismissal.
The Bill proposes restricting remedies for employees earning above R1.8 million a year, adjusted annually for inflation. Mahomed said such employees would be entitled to reinstatement only where the dismissal is automatically unfair, with compensation becoming the primary remedy in other cases.
Bowmans says the proposal aligns with International Labour Organisation standards, which allow differentiation in the treatment of higher-paid employees.
The Bill would also allow the Minister to prescribe a compensation cap, meaning a high-earning employee who successfully challenges a dismissal could receive less than their annual remuneration even if the dismissal is found to be unfair.
The Bill also seeks to prevent duplication of dismissal claims. Employees currently sometimes pursue an unfair dismissal claim under the LRA while simultaneously pursuing a contractual claim for unlawful termination in court.
Mahomed said the proposed amendment would require employees to choose one route, preventing overlapping claims arising from the same facts. Bowmans says the change is aimed at reducing the growing litigation burden on the Commission for Conciliation, Mediation and Arbitration (CCMA) and the Labour Court.
Retrenchment and severance costs could rise
The Bill also proposes significant changes to retrenchment law, both in terms of cost and procedure.
The most immediate cost impact is the proposed increase in minimum statutory severance pay.
Currently, employees retrenched for operational requirements are entitled to one week’s remuneration for each completed year of service. The Bill would increase this to two weeks’ remuneration per completed year of service.
Bowmans notes that the higher entitlement would apply only to years of service commencing after the amendment takes effect, which means employees retrenched at the same time could receive different severance payouts depending on when their service began. This could create discrepancies and potentially trigger industrial conflict.
The Bill also proposes changes to large-scale retrenchment procedures under section 189A of the LRA.
One amendment would give the CCMA authority to make rules governing facilitation, rather than leaving this function with the Minister. Facilitators would also be able to determine picketing rules where unions have issued strike notices during retrenchment consultations.
Another key change concerns how retrenchment disputes are challenged. Bowmans says the Bill proposes deleting the current provisions that allow urgent court challenges to procedural fairness during ongoing retrenchment consultations.
Instead, disputes over both procedural fairness and substantive fairness could be challenged after the dismissal, effectively restoring the legal position that existed before section 189A was introduced.
New protections for non-traditional work
Another potentially significant change in the Bill relates to how labour legislation defines who qualifies for protection in an evolving labour market.
The amendments respond to the growth of gig work, platform-based services, and other flexible employment arrangements that do not fit neatly into traditional employer-employee relationships.
Importantly, the proposal does not replace the existing statutory definition of an employee in the LRA. Instead, it introduces an additional category of workers who may qualify for certain labour rights even if they fall outside the conventional employment relationship.
Mahomed said the reform reflects the reality that many modern work arrangements no longer align with traditional labour law concepts.
A new Schedule 11 to the LRA would extend certain labour rights to individuals outside the traditional definition of employee. Bowmans says the schedule would extend freedom of association, organisational rights, and collective bargaining rights to a broader category of workers – often referred to internationally as dependent contractors.
Mahomed explained that the concept draws on a broader understanding of “workers”, which can include individuals performing work for another party even without a formal contract of employment.
The amendment also introduces a presumption of employment. Employers would have to rebut this presumption by demonstrating that the individual is not subject to their control, is not integrated into their organisation, and does not provide services to customers on the employer’s behalf.
Mahomed noted that the expanded category mainly grants collective labour rights – such as freedom of association and collective bargaining – rather than the full range of dismissal protections enjoyed by traditional employees.
The Bill also proposes a new section in the BCEA regulating on-call or zero-hours contracts. Mahomed said these arrangements have long existed in practice but have not previously been explicitly regulated in legislation.
Bowmans says employers would have to specify in writing the maximum hours of work, periods when employees must be available for work and notice periods for reporting or cancelling work. Employees would need to be paid for cancelled work where adequate notice is not provided, and employers would generally not be allowed to prevent them from working elsewhere unless justified by operational requirements.
Compliance and enforcement changes
The Bill also introduces several changes aimed at strengthening enforcement and dispute resolution.
Expanded harassment claims under the EEA
The Bill proposes expanding access to arbitration for harassment-related discrimination claims under the Employment Equity Act.
Currently, only sexual harassment claims can be referred to the CCMA for arbitration if conciliation fails. Other harassment-based discrimination disputes must generally be heard in the Labour Court.
The proposed amendment to section 10 of the EEA would allow employees to refer any harassment-based unfair discrimination claim to the CCMA for arbitration. This means claims involving harassment based on race, gender, disability, or other listed grounds could also be resolved through CCMA arbitration.
Labour advisory firm Labournet says the change recognises that workplace harassment disputes often involve multiple overlapping forms of discrimination, rather than a single category such as sexual harassment.
The amendment may also reduce fragmented litigation between the CCMA and the Labour Court.
For employers, Labournet notes that harassment policies may need to be reviewed to ensure they cover psychological, racial, gender-based, and other forms of harassment, given the increased likelihood of CCMA scrutiny.
The Bill also clarifies that employers issued with an EEA Certificate of Compliance will be regarded as compliant under certain related regulatory frameworks, reducing duplication.
Stronger enforcement of retirement fund contributions
The Bill also introduces a new section 77B into the BCEA, aimed at strengthening enforcement where employers fail to pay pension or provident fund contributions.
According to Michelle David, Ntokozo Ngubane, and Francisco Andrade-Nobrega of Norton Rose Fulbright, the amendment addresses a long-standing problem involving unpaid retirement fund contributions regulated under the Pension Funds Act.
The provision would empower the Labour Court, CCMA, or bargaining councils to order employers to pay outstanding contributions owed on behalf of employees and to pay interest on those amounts.
The amendment also clarifies jurisdiction between dispute forums, preventing overlapping processes where the Pension Funds Adjudicator has already issued a determination.
The lawyers say the change is likely to encourage employers to strengthen compliance systems, including reviewing payroll processes, auditing historical contributions, and improving record keeping.
Technical clean-up changes
The Bill also removes some controversial proposals contained in earlier drafts.
Bowmans notes that proposed changes to the definition of “unfair labour practice” have been withdrawn, meaning section 186(2) of the LRA remains unchanged.
The Bill also deletes Schedule 8 of the LRA, which contains the original Code of Good Practice on Dismissal, following the publication of a new Code of Good Practice in September 2025.
Key flashpoints to watch
Several of the proposed amendments are expected to generate debate during the public comment process.
Labour law specialists say the most contested issues are likely to include:
- the probation-period limitation on dismissal protections,
- the expanded definition of employee and dependent contractor protections,
- the restriction of remedies for high-income employees,
- and the changes to retrenchment dispute procedures.
The consultation process will play a key role in determining which of the proposed reforms ultimately become law.
Comments on the Labour Law Amendment Bill and the Labour Relations Amendment Bill must be submitted by email to Hlukani.Mabunda@labour.gov.za and/or Kopano.Kgatlhanye@labour.gov.za.
Submissions must reach the Department of Employment and Labour within 30 days of the publication of the notice in the Government Gazette on 28 March 2026.
Late submissions may not be considered.
