04:05 AFRICA
Netherlands, authorities are tightening enforcement of disguised employment, mainly when an independent contractor works so closely under a company’s direction that, in the eyes of the law, they’re actually an employee. South Africa is no different. Under our Basic Conditions of Employment Act (BCEA) and Labour Relations Act (LRA), if a person works only for one client, follows your hours, and takes instruction from your managers, they’re likely considered an employee - no matter what the contract says. Why Misclassification Is a Growing Global Problem The freelance economy has exploded since the pandemic. Gartner estimates that 58% of HR leaders now rely on contingent workers to fill skills gaps. The upside is flexibility and speed; however, the downside is that many of these
Misclassification also hurts the worker. Contractors who should be employees miss out on paid leave, pension contributions, and job security.
around, they’re left trying to reconcile mismatched paperwork and liabilities that should never have been theirs in the first place. What Makes a Worker an Employee (Even If You Call Them a Contractor) The simplest way to look at it is: If the person you’re hiring only works for you, uses your systems, follows your rules, and depends on your payments, they’re probably an employee under South African law. Some telltale signs include:
arrangements are built on shaky legal ground. In South Africa, we’ve seen international companies “hire” remote workers as independent contractors only to discover later that those workers were entitled to employee benefits and protections under local law. When the Commission for Conciliation, Mediation and Arbitration (CCMA) steps in, the results can be costly: reinstatement orders, back pay, legal fees and possible reputational damage. Misclassification also hurts the worker. Contractors who should be employees miss out on paid leave, pension contributions, and job security. When the tax season rolls
You dictate their working hours or schedule
42 I 04:05
GLOBAL PAYROLL MAGAZINE ISSUE 19
Made with FlippingBook - Share PDF online