KEY UPDATES AT A GLANCE

Effective 4 September 2025, South Africa introduced a new Code of Good Practice: Dismissal. This replaces the long-standing Schedule 8 of the Labour Relations Act as well

as the separate code on operational requirements (retrenchments). The reform marks one of the most significant updates to workplace dismissal law in decades, aligning policy with modern workplace realities.

WHY THE CHANGE?

The old framework had become fragmented: Schedule 8 covered misconduct and incapacity, while a separate code dealt with retrenchments. This often created uncertainty for employers and employees navigating different processes. The new Code brings everything together in one document, simplifying guidance and setting clearer expectations.

KEY UPDATES AT A GLANCE

• One integrated framework: Misconduct, incapacity, poor performance and retrenchments are now addressed under a single code.
• Simplified procedures: Dismissal processes should be fair but need not resemble criminal trials. The emphasis is on giving employees a real opportunity to be heard, without unnecessary formality.
• Recognition of small businesses: The Code acknowledges that small employers may not have the resources for highly formal processes, allowing flexibility while still requiring fairness.
• Probation clarified: Probation is now explicitly to test both performance and suitability. Employers are warned against misusing probation to churn staff.
• Senior employees: For highly skilled or senior employees, repeated warnings may not always be necessary before dismissal for poor performance.
• Expanded incapacity: The Code now includes non-medical incapacity such as imprisonment and incompatibility (inability to work harmoniously in a team).
• Operational requirements (retrenchments): A new template for Section 189(3) notices is included, standardising the information employees must receive during retrenchment consultations.
• Unprotected strikes: Updated guidance on how employers should handle ultimatums and timelines in cases of unlawful industrial action.

HOW THIS DIFFERS FROM THE OLD FRAMEWORK

• Old Code: Focused mainly on misconduct and incapacity, with retrenchments handled separately. Dismissal was treated as a last resort after progressive discipline, and probation was largely about performance.
• New Code: Brings everything under one roof, modernises procedures, expands definitions of incapacity, and provides practical tools like the retrenchment notice template. It is more flexible but still grounded in fairness.

WHAT THIS MEANS FOR EMPLOYERS

• Policy updates: Review disciplinary, incapacity and retrenchment policies to align with the new Code.
• Training: Ensure managers understand when informal processes are acceptable and when more formal processes are required.
• Documentation: Keep detailed records of allegations, responses, and reasoning for decisions – fairness remains central.
• Global alignment: Multinational employers should integrate these changes into their global HR frameworks while respecting South Africa’s specific legal requirements.

CLOSING THOUGHT

The new Code is not about making dismissal easier, it is about making dismissal fairer, clearer, and more practical. For employers, it reduces red tape and ambiguity. For employees, it safeguards rights with transparent processes. The shift reflects South Africa’s effort to balance job security with business flexibility in a rapidly changing labour market.