Is your life changing in a way that will have an impact on your domestic worker? Perhaps you’re planning to move to another city or country, or your “money out” is edging towards or exceeding “money in”, or you may be considering the extent to which you need their services.
The guiding principle for reducing hours or retrenchment is that you need to proceed fairly. This starts with consultation – in advance. The preferable route, from a legal standpoint, is to avoid dismissal, or at least to minimise the effects on the employee.
Reducing hours
If you are struggling to afford the domestic worker’s salary, and you are thinking of cutting the domestic worker’s hours from five to three days a week, for example, it’s not enough to inform the domestic worker – that would be deemed an unfair labour practice. “The employer must discuss [this] with the employee since that reduction will amount to a change in the terms and conditions of employment,” says a legal expert at the Socio-Economic Rights Institute (SERI). (Note that, legally, a contract should have been in place from the outset.) “The employee is entitled to reject the reduction but, depending on the reason why the reduction was proposed in the first place, that may lead to a retrenchment particularly if the reduction was based on the employer’s financial position.”
If an agreement is reached on reduced hours, is the employer legally obliged to pay severance pay? “No severance is paid,” says the SERI legal expert. “If the employee agrees to the reduction, the new terms and conditions of employment kick in.”
Amy Tekié, co-founder of Izwi Domestic Workers Alliance, says her organisation tells employers who are reducing the number of hours that they need to do a full retrenchment, and then start with a new reduced contract. The reason is that if the worker is retrenched years later, the rate that should be applied to their severance pay could otherwise be disputed. “We have numerous cases where this is an issue. The contract needs to be amended in writing, and both parties need a copy.”
Retrenchment (complete dismissal)
You need to give the domestic worker the reasons that you cannot continue to employ them, the date on which this would take effect, the severance amount you intend to pay, any help you are able to give them in terms of finding new employment, and whether there is any possibility that you might be able to reinstate them if circumstances change. This all needs to be in writing.
Severance pay is set at at least one week’s pay for every full year of service – at the current rate of payment of your domestic worker.
As of 5 February 2025, the Minister of Employment and Labour mandated a National Minimum Wage of R28.79 per hour. If the domestic worker was working 40 hours a week for 4.333 weeks a month (per labour law calculations), then they would be earning a minimum of R4989.88 until next year’s minimum wage announcement.
To show how severance pay is calculated, let’s say you were paying your domestic worker R5000 a month, and they have been employed for 10 years.
Then the severance pay is:
R5000 / 4.333 = R1153.86 per week
x 10 years = R11 538,60
Since this domestic worker was employed for more than six months, you need to give at least four weeks’ notice, or pay what they would have earned in that time. For someone who has worked for less than six months, the notice period is at least one week, or the equivalent pay. You also need to pay for any leave not yet taken. If the domestic worker lives at your property, then they are entitled to stay there at least a month from the date that you give notice or the end of the contract (whichever is later).
Also, provide the domestic worker with a certificate of service, as this is a legal requirement.
Further reading:
• Easy-to-read information on this, and other aspects of employing a domestic worker – Employing a Domestic Worker: A Legal and Practical Guide, written by Socio-Economic Rights Institute of South Africa (SERI) researcher Kelebogile Khunou, and Izwi Domestic Workers Alliance co-founder Amy Tekié, is available to download, free of charge.
- South African Legal Information Institute (SAFLII) Sectoral Determination 7: Domestic Worker Sector (though this was last updated in 2019, and rates of pay are out of date)
- CCMA’s Information Sheet on Small-scale retrenchment.
