Frequently Asked Questions
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When should I register my domestic worker with the Department of Labour?
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As soon as your domestic worker works for you for 24 hours or more per month, you have to register the employee with the Unemployment Insurance Fund. Visit www.labour.gov.za for the requisite form in this regard to assist you in registering the employee.
How should I deal with an employee who has breached the Organisations Code of Conduct?
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No employee may be unilaterally dismissed without a disciplinary enquiry being held wherein the employee has the opportunity to answer to the charges and to place his / her version to the hearing. The first step is to investigate the alleged breach, then determine whether the employee can be progressively disciplined without having to proceed to a hearing, in example with training or mentorship. Only when the seriousness of the offence is of such a nature that it warrant a hearing should a hearing proceed. The employer has the duty to give the employee proper notice of the hearing and to include the charges sufficiently to allow the employee to prepare their case. It is advisable to consult an expert prior to unilaterally imposing a sanction on an employee. Contact us for advise if you feel stuck and unsure of the procedure to follow.
What can I do if a Director in the company has acted to the detriment of the company and caused financial damages?
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The Companies Act provides for the removal of a director either by the Shareholders of the Company or by the Board of Directors. See Section 71(1), (2) and (3) of the Companies Act to determine whether the removal will be suitable and ensure compliance with the legislative provisions. Note, that any removal that is not in line with the requisite meeting requirements will not be enforceable. If the Director is also employed as an employee, remember that the removal in terms of the Companies Act does not automatically end the employment relationship. Make sure to follow due process from a Labour Law perspective to de-risk the company from claims from the removed director.
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If the damaged sustained by the company has been determined, the director in question may be held personally responsible for the damages in terms of Section 77 of the Companies Act. Contact us for assistance if this is a concern for your company.
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Why should Shareholders enter into an agreement to define their rights and responsibilities in a Company?
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In our opinion it is imperative to enter into a Shareholders Agreement when more than one Shareholder is involved in a Company. Amongst other reasons, the main reasons in our experience is:
- If there is no Shareholders Agreement, the Shareholders may sell their shares to any third party and or entity and the remaining Shareholder will have no right of first refusal.
- A Shareholders agreement should contain the rights of shareholders in the company, including their right to access to information, triggers that may cause them to automatically place their shares on the table (in example if the Shareholder was guilty of financial misappropriation and has been criminally prosecuted).
- In the event of the passing of a Shareholder, that deceased shareholders shares will automatically form part of their deceased estate and this could cause difficulties in the management of the company. See our proxy opinion in the BLOG tab.
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