Be careful with contracts and letters of appointments

IT IS a requirement for each employee to have at least a letter of appointment or a contract of employment, in terms of the Basic Conditions of Employment Act, which is applicable to most employees in South Africa. The legislation requires employers to supply their employees at the commencement of employment with certain particulars.

There must be the full name and address of the employer, the name and occupation of the employee and a brief description of the work for which the employee is employed. It is also vital to outline in the contract the place of work and where the employee is required or permitted to work at various places.

The letter or the contract will have the date upon which the employee began work and it will also outline the ordinary hours of work and the days of work expected of the employee.

The wage rate and the method of calculating the wages will be contained therein and include the rate of overtime that will be paid.

If the employee has been promised or offered any other types of employment, this would be described in the contract.

It is expected of the employer to show when the remuneration will be paid and how deductions are calculated and what they are for. The leave entitlement is usually described and the notice period which is expected for termination will be properly structured in the contract.

The contract or the letter of appointment will be given to the employee and the employer who will both have a copy for their records. Often the contracts are for a period duration for specific period or will outline that it is open ended. Many employers include a probationary period for both the employer and the employee to assess whether they are able to work together functionally.

This probationary period will be outlined and detail how long it is and its terms. Most employers will have a retirement age which will be indicated.

Often employees are given other benefits such as medical aid, a pension fund, insurance for housing or a travelling allowance. If this has been promised to the employee, it should be contained in the letter of appointment. If there are any other benefits accruing to the employee these will be outlined.

Sometimes the employees are entitled to commission or a profit share and this can be contained in the letter of appointment or in a separate document.

The restraint of trade agreements are sometimes contained in the letter of appointment but are often in a separate contract given to the employee to sign before entering employment. Restraintof-trade documents have to be carefully read and understood before being signed by an employee.

Many employers have terms and conditions of service such as disciplinary codes and codes of good practice on maternity leave, sexual harassment, safety procedure and so on. These can be referred to in the letter of appointment but are often found in separate documents.

The documents should be carefully perused and signed by the employee in order to indicate that the employee has received the documents and understands them. If an employer wishes to hold an employee to the terms and conditions contained in these documents, it would be vital for the employer to show that the employee received the document, read the document and understood the document and has signed to confirm that both parties are bound by the terms contained in the conditions attached to the letter of appointment.

Many employers fall under bargaining councils or have agreements with trade unions. If the trade union agreement is a closed-shop agreement this would be contained in the letter of appointment.

Sometimes employers have their own dispute resolution agreements which will be contained in the contract.