Worker bonuses: what employers should know

Contrary to belief by some workers, employers are actually not legally obliged to pay year-end bonuses to their staff. To avoid any misconceptions between the parties, Meyer Louw suggests an upfront approach.

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Many farmers like to give their workers a bonus at the end of the year or after a good harvest. It's a way of saying thank you for hard work, and it can go a long way towards boosting morale. But while bonuses are appreciated, they can become complicated if not properly managed.

IS IT A LEGAL REQUIREMENT?

According to the Basic Conditions of Employment Act (No. 75 of 1997, as amended) and Sectoral Determination 13, which regulates the basic conditions of employment for farmworkers, employers are not legally required to pay bonuses.

There are, however, situations where a bonus can become something an employee is entitled to, if, for instance, a bonus is written into the employment contract, included in a collective agreement, or has become an established practice that creates an expectation.

When a year-end bonus has been paid every December for several consecutive years, employees may begin to see and expect the bonus as part of their employment benefits.

COMMON TYPES OF BONUSES