Regulatory regime governing the employment of non-citizen or foreign workers

October 1, 2024

South Africa: Labour markets have become increasingly integrated through globalization. This presents unique opportunities for South Africa and other emerging markets to leverage global talent pools and seek skilled employees who can drive economic growth. As companies expand across borders, they can tap into global talent networks, filling crucial gaps in local labour markets where specialised skills may be scarce. Companies seeking to leverage global markets must ensure they keep up to date and aware of the broader employment and immigration regulatory regime.

When employing foreign nationals in South Africa, businesses must adhere to the comprehensive immigration and employment laws that regulate the engagement of non-citizens into the workforce. Understanding and complying with this legal framework is essential to ensure companies don't violate prescribed laws and avoid the consequences which flow from non-compliance. These laws govern work permits, visa requirements, and labour rights, ensuring that foreign workers are engaged lawfully and ethically. Below, we broadly discuss the relevant laws governing the employment of foreign/non-citizen workers.

The General Legal Framework

In South Africa, the relationship between employees and employers is primarily governed by section 23 of the Constitution of the Republic of South Africa ("Constitution") and several key pieces of legislation. The statutory framework includes, but is not limited, to the Basic Conditions of Employment Act ("BCEA"), the Labour Relations Act ("LRA"), the Occupational Health and Safety Act ("OHSA"), and the regulations and other subordinate legislation accompanying and supplementing the Constitution and aforementioned primary legislation. We provide a brief synopsis of the objectives of each of the key Acts.

The Basic Conditions of Employment Act 75 of 1997

The BCEA is a key piece of labour legislation which sets the minimum standards for employment conditions to ensure fair treatment of workers. It covers various aspects of employment such as working hours, overtime, leave entitlements (including annual, sick, and maternity leave), and notice periods for termination. The BCEA also establishes rules regarding payment of wages, employment contracts, and workplace policies, aiming to protect vulnerable employees and create a balanced work environment.

The Labour Relations Act 66 of 1995

The LRA aims to promote fair labour practices by regulating issues such as unfair dismissal, labour disputes, and collective bargaining, while providing mechanisms for the peaceful resolution of workplace disputes and fostering constructive labour relations.

Occupational Health and Safety Act 85 of 1993

OHSA aims to ensure the health and safety of employees in the workplace. It places a duty on employers to create a safe working environment by identifying potential hazards, implementing safety measures, and providing appropriate training. The Act also requires employees to take reasonable care of their own safety and that of others.

The Broader Regulatory Regime and the Application to Foreign/Non-Citizen Workers.

Immigration Act 13 of 2002

The employment of foreigners in South Africa is governed by the Immigration Act, as amended. This Act outlines the requirements for the entry, residence, and departure of foreign nationals, including their ability to work in the country. The Immigration Act is supported by the Immigration Regulations, which saw notable updates in May 2014, particularly concerning work visas.

The Employment Services Act 4 of 2014

The Employment Services Act ("ESA") amongst other things regulates the employment of foreigners. ESA has been introduced to promote employment, encourage productivity, decrease levels of unemployment and provide training for unskilled workers. One of the specific aims of ESA is to facilitate the employment of foreign nationals in a manner that is consistent with the objects of the Immigration Act.

Employment Services Amendment Bill, 2021

Employment Services Amendment Bill, 2021 ("ESA Bill") proposes significant amendments to the ESA particularly concerning the employment of foreign nationals in South Africa. The ESA Bill stems from the National Labour Migration Policy ("Policy") put forward by the Minister of Employment and Labour. While the Policy suggests various reforms, specific provisions aimed at regulating the employment of foreign nationals in South Africa have led to the Bill proposing changes to the Act. One key change is that the Bill places strict limitations on employers, prohibiting the employment of foreign nationals unless they have a valid work visa, are asylum seekers with the right to work, or are otherwise legally permitted to work in South Africa under existing laws.

Obligations of employers engaging foreign nationals/non-citizens

There is a common misconception among employers that they can bypass labour regulations when hiring foreign workers. It is important to recognize that foreign employees, including those without valid work visas, can still rely on and enforce certain applicable rights, provided for in the labour regulatory regime (as if they were South African nationals) in circumstances where they are engaged in an employment contract with an employer.

Section 213 of the LRA defines an 'employee' as:

"any person, excluding an independent contractor, who works for another person or the state and is entitled to receive remuneration; and (b) anyone who assists in carrying out or conducting the business of an employer in any way"

Additionally, section 23(1) of the Constitution, does not confine the right to fair labour practices to South Africans only. The law does not declare an employment contract void simply because a foreigner lacks the required permit, nor does it criminalize the foreigner for accepting work without proper authorization. Rather, it is the employer who faces potential liability for employing a foreign national in violation of the law. The illegal act is the employment itself, not the foreigner's acceptance of work.

In this regard, employers are obligated to:

1. Ascertain whether the foreign national is entitled to work in South Africa;
2. Satisfy themselves that there are no other persons (i.e., citizens, permanent residents or refugees) in South Africa other than foreign nationals with the requisite skills to fill the vacancy;
3. Prepare a skills transfer plan in respect of any position in which a foreign national is employed, although the Minister may exclude employers in certain sectors or categories of workers from the requirement to prepare a skills transfer plan;
4. Employ such foreign national on terms and conditions of employment that are not inferior to those which would be provided to a citizen, permanent resident or refugee; and
5. Retain copies of all documents reflecting that the foreign national is lawfully entitled to be employed in the Republic.

The Bill, in line with the proposed Policy, provides for a framework that will essentially tighter regulate and set limits on the employment of foreign nationals for specific sectors, occupational categories or even geographical regions. Employers making extensive use of foreign nationals should take note of these proposed provisions and monitor further developments for potential impact on your business.

Accordingly, employers are advised to ensure that employers do not employ illegal foreigners in contravention of the Immigration Act. Employers must make a good faith effort to ascertain the status or citizenship of any foreigners they intend to employ. This could be in the form of verifying the validity of prospective employees' work visas, refugee or asylum permits through either the Department of Home Affairs ("DHA"), a third-party service provider such as the Managed Integrity Evaluation Services, or through conducting an immigration audit of all their current foreign employees. As part of its zero-tolerance approach, the DHA confirmed that employers who are found to have contravened the Immigration Act will be dealt with accordingly. Any person who contravenes the provisions of the Immigration Act shall be guilty of an offence and liable to either a fine or imprisonment upon conviction.

Authored by Bongi Maseko, Bwanika Lwanga and Deepna Desai (Associates at Dentons in South Africa)