RESHAPING THE EMPLOYMENT LANDSCAPE: KEY CHANGES PROPOSED IN THE LABOUR LAW AMENDMENT BILL, 2025
The Labour Law Amendment Bill, 2025 ("the Bill"), was published by the Minister of Employment and Labour on 26 February 2026 for public comment, with submissions due by 30 March 2026. The Bill proposes sweeping changes to the Basic Conditions of Employment Act ("BCEA"), the Labour Relations Act ("LRA"), the Employment Equity Act ("EEA"), the National Minimum Wage Act ("NMWA") and the Unemployment Insurance Act ("UIA"). It follows more than two years of consultation at NEDLAC and has been described as the most comprehensive review of South Africa's labour legislation in over a decade.
With the uncertainty surrounding these proposed changes to labour law in South Africa, it is critical that employers and employees alike are well informed of the impact they may bring. While the Bill contains many amendments, this article discusses the key proposed changes that will reshape the employment landscape.
1. Statutory Severance Pay Doubled
The current position under section 41 of the BCEA prescribes statutory severance pay (payable on dismissal for operational requirements) at one week's remuneration for every completed year of continuous service. The Bill proposes to double this to “two weeks” remuneration for every completed year of service. Importantly, the increase will apply prospectively - it will only accrue in respect of completed years of service after the amendments come into force. This change materially increases the future cost of restructuring and workforce resizing, particularly for labour intensive sectors.
2. Broader Definition of "Employee" Extends Collective Rights
The Bill introduces a new “Schedule 11” to the LRA, which will amend the definition of employee to include: “an individual, other than an employee as defined in section 213 of the Act, who works for a person that is not a client or customer of any profession, business or undertaking carried on by the individual.”
The intention is to address shortfalls in the protection of workers in non-standard employment, particularly “gig economy and platform workers” (such as those working for ride hailing and delivery apps). These workers will gain access to organisational rights, collective bargaining and freedom of association protections under the LRA.
3. Capped Remedies for High Earners
The Bill proposes a new earnings threshold of R1 800 000 per annum, above which:
Reinstatement will generally no longer be available as a remedy for unfair dismissal (except in cases of automatically unfair dismissals or dismissals constituting unfair discrimination).
Compensation becomes the primary remedy, “capped at 12 months remuneration”, with a maximum value of R1 800 000, regardless of the employee's actual earnings.
This change is designed to create greater certainty for employers managing executive and senior level exits, while preserving the full range of remedies for lower earning employees and for the most serious categories of dismissal.
4. Greater Protection for On Call and Zero Hours Workers
A new “Section 9B” of the BCEA introduces minimum protections for employees on "on call", "zero hours" or "if and when" contracts, required to work only when the employer makes work available. Should the Bill be passed, employers will be required to:
Specify the maximum hours the employee may work per period.
Specify the period during which the employee must be available for work.
Provide reasonable notice period for both reporting to work and cancellation of work.
Pay employees for cancelled work where the employer cancels without giving the required notice.
These reforms are aimed at introducing predictability and protecting vulnerable workers from volatile hours and last minute cancellations, particularly in sectors such as retail, hospitality, security, logistics and platform based work.
5. Limited Protection for New Employees During Probation
The Bill proposes a significant amendment to “Section 188 of the LRA”: new employees will not be entitled to institute a claim on the basis of unfair dismissal during the “first three months” of their employment, or during a longer probation period if that period is reasonable and operationally justifiable.
Critically, protection against ‘automatically unfair dismissals’ (such as those based on discrimination, pregnancy, or the exercise of a protected right) remains intact throughout, regardless of an employee's length of service.
This change is intended to encourage employers, particularly in sectors facing high unemployment to hire more readily, especially young and first time workers, by reducing the legal risk during the initial assessment period.
Conclusion
The Bill is currently open for public comment until 30 March 2026. After that, it must still be tabled in Parliament, debated by the Portfolio Committee on Employment and Labour, passed by both the National Assembly and the National Council of Provinces, and signed by the President before it becomes law. The final Act may therefore differ from the current draft. Employers and employees are encouraged to submit comments before the deadline and to start reviewing their policies and contracts now, rather than waiting until the changes take effect.
Written by Alexi Rosenzweig and Bailey Stewart – The Labour Law Department
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