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What to do when Employees refuse to sign an Employment Contract / Letter of Appointment.

10 minute Read

Written By: Angelina Fitchett 

CEO LearnerSphere Consulting & Development 


The long and the short of it is that there is no law that states an employee must sign a Contract of Employment. However, BCEA (Basic Conditions of Employment Act) does state that at the start of the relationship there must be agreement on the terms and conditions of employment such as working hours, benefits, salary (wage), place of work, job description etc. This is generally covered in a Letter of Appointment or Contract of Employment. Furthermore, there should be a list or mention of the Policies and Procedures as well as the Disciplinary Code of the company in the document.
Before I go on about how you can get around this problem, let me say this! A lax attitude towards having HR or at least some guidance from an HR Professional on how to run the people side of your business, can seriously hurt you and your business.
You cannot start a business or start employing people in your business until you have engaged with an HR Professional.
Imagine you land a huge contract that requires additional overtime by your labour force? Now imagine you have no backup labour – no scab labour and not enough who do agree to do the work. What then? How do you get your employees to work if they have nothing in writing that obligates them to work and no union / employer agreement in place. The sad fact is… YOU DON’T!
Stringent Policies and Procedures as well as Contracts of Employment and Strong Disciplinary Codes are essential for a business to run effectively. These things DON’T TAKE CARE OF THEMSELVES.
If your processes are in place, you will have a formal structure on how you go about recruiting… Hence a potential employees must be told in their interview that they are obliged to sign an employment contract and can be given a copy that clearly has “DRAFT FOR INFORMATION PURPOSES ONLY” noted on each page so that it cannot be misused.
Any potential employee who does not want to sign your contract or wants to change more than just the spelling of their name or ID number, must not be hired. Not even on a casual basis.
You will need to explain to them that this is the only way that there can be agreement and understanding of what is expected from them.
Once you have employed someone without a contract or failed to terminate a limited contract, it becomes very difficult to force them to sign one after the fact. Scepticism sets in and the once humble job seeker can turn into the manipulative influencer.
There is light at the end of the tunnel if you consider the general rules of Discipline in your company or if you have Policies and Procedures in place. Of course if you don’t you’re really going to have to be creative about it and make it their idea or gain the information you need another way.
Let’s first look at the basics…
The following information is absolutely essential on the Contract of Employment:
1. Full names, surname and identity number of the employee;
2. The company name and address (addresses) where they are required to work;
3. The position the employee is hired for;
4. The reporting line of the person;
5. The wage / salary they will earn and any additional benefits and the deductions that will be made from their income;
6. Mention of overtime hours and pay associated with that;
7. The start date of employment and end date if it is a limited duration contract as well as mention of previous employment if they were on a limited duration contract;
8. The hours they are required to work as well as the leave they are entitled to;
9. Termination / Notice period, i.e. 1 Calendar month or 30 days or two weeks in the first 6 months of employment;
10. The Bargaining Council or affiliate employee organisation agreement you may be bound by;
11. Any other additional information / rules specific to your company; and
12. A clause which states that the company has a Disciplinary Code as well as Policies and Procedures which the employee is required to familiarise themselves with.
Be sure you are thorough with the contract because once it’s signed by both parties it’s going to be very hard to get them to sign another if there are changes in them. Any other change in terms of Job Title / Promotion / Pay Grade etc must be an addendum to the contract signed by both the employer and employee and put in the employee file as well as a copy given to the employee.
Now let’s look at ways to get the employee to confirm all their conditions of employment...
1. Provide an information sheet that they need to complete ~ This can ask questions about their perception of their job and you get a clear understanding of what it is they see themselves employed for as well as an update of information for purposes of reaching them on absent days.
2. Make them sign for payslips and all documentation handed to them ~ A new policy is being put in place that all work done must be signed for by the person receiving it as well as the person executing it. The instructions become written ones to protect both company and employee.
3. Draw up a document that states the obvious by way of confirmation ~ “You confirm that you are being paid this wage… (present a copy of the payslip). You confirm that you are working these hours… (present a copy of the clock card). You confirm that you have been doing this job… (present a copy of the work sheet where they did the job, a picking slip, Works instruction etc). Do you get my drift… although you may still get some employees that will not engage in this.
4. Performance Appraisals ~ Implement them as part of a strategy to improve performance and decide on who does what training. The PA is given to the employee before the performance appraisal and they have a chance to write their key tasks as well as their pay grade and the department they work in. Usually employees like to write down a lot more than what their usual job description is just to prove they do more than expected, especially if they are disgruntled.
5. Withhold Wage Payments or pay them late or change the date ~ Where is the agreement that you would pay them on this day or that day and how much. This is drastic but could then be followed by the information sheet as stated in point 1 or document of point 3 above.
If all of the above is still not satisfactory and has not fully helped your situation, you can go the discipline route. The simple fact is that you have a policy that says that all employees must adhere to the code of conduct of the company as well as the disciplinary process. You will set a formal meeting, HR Professional present, who will inform them that contracts are necessary and binding per the policy and that the labour department has a requirement for this to be on file as well as the auditing firm you work with. You give them time to consider the information in the contract, to absorb it and not much room to change it or bring concerns forward. I.e. Nobody can dispute their working hours if they are clocking in and out at the same time every day, nor can they dispute their wages if they are accepting them in their bank accounts and not disputing their payslips.
With the above comes an instruction to sign it by a certain date or to bring concerns.
ACTION BY YOU ~ If the instruction is not adhered to / followed even after you have negotiated and discussed options or changes, discipline for failing to obey a reasonable instruction prevails.
WARNING: Section 189 of the Labour Relations Act safeguards against retrenchment due to the absence of a contract. This can be seen as unfair dismissal.
For a comprehensive look into your HR Health as well as your risk in terms of your employees, or potential employees, book your HR Health Audit with LearnerSphere Consulting & Development.
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