idden Risks of endent Contractor gements in South Africa Independent contractor agreements are hey are especially appealing for companies
T
seeking specialised skills for a specific project or a short-
increasingly popular in today’s global and digital economy.
term engagement without the ongoing responsibilities that come with hiring permanent staff. On the surface, it’s a win-win: companies gain operational flexibility, and contractors enjoy the freedom of being their own boss. However, South Africa’s labour framework doesn’t solely consider what’s written in the contract. What truly matters is how the relationship functions in reality. If the contractor behaves like an employee, works like an employee, and is treated like an employee, South African labour law may indeed classify them as such, regardless of the contract’s title. This ‘substance over form’ approach is enshrined in both the Labour Relations Act (LRA) and case law, leaving employers at significant legal risk if they misclassify a contractor.
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ISSUE 11 GLOBAL PAYROLL MAGAZINE
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