The Prescription Act 68 of 1969 safeguards employers against the indefinite pursuit of severance pay claims. This legislation sets a definitive time limit within which claims must be initiated, thus providing employers with certainty and protection from protracted liabilities. In terms of the Basic Conditions of Employment Act (BCEA), specifically Section 41(1), a retrenched employee [...]
Severance pay in South African labour legislation is primarily governed by the Basic Conditions of Employment Act (BCEA) and the Labour Relations Act (LRA). The calculation of severance pay typically depends on the specific circumstances and agreements in place. Section 41 of the BCEA provides the default position when calculating statutory severance pay. Severance pay [...]
In our previous article, we discussed the entitlement to severance pay in terms of Section 41 of the Basic Conditions of Employment Act (BCEA) and the circumstances under which the benefit arises. Severance pay entitlement arises when an employee’s contract of employment is terminated for operational requirements. In terms of the section, the right to [...]
In terms of Section 41(4) of the Basic Conditions of Employment Act (BCEA), an employee who is dismissed for operational requirements is not entitled to severance pay if the employee “unreasonably refuses to accept the employer's offer of alternative employment with that employer or any other employer”. The Labour Appeal Court (LAC) previously set out [...]
The question of whether employees are entitled to severance pay is a well-established aspect of South African statutory labour law. While the circumstances under which severance pay becomes due to employees are relatively limited, it's not uncommon for employees to ask to be paid for their “years of service" during dispute resolution processes. Many employees [...]
The question of whether an employee is entitled to severance pay usually arises once a retrenchment has been concluded and there is a dispute referred to the CCMA or a Bargaining Council. An arbitrator dealing with this dispute may only decide whether the employee is entitled to the severance pay, which is a statutory entitlement. [...]