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Here's a checklist of the 16 items SARS needs you to include in your employee's contract

by , 09 October 2013
It's your legal obligation to give your employee a written employment contract. But do you know what should be in your employee's contract? Read on to find out so you can comply with the Basic Conditions of Employment Act (BCEA) and stay on the right side of SARS.

An employment contract's only binding and enforceable when there's been an agreement. This means you've made an offer to the employee in writing and he's accepted it in writing, says the Practical Tax Loose Leaf Service.

To ensure SARS doesn't scrutinise your employment contracts, be sure to include these 16 items in your employee's contract.

16 items to include in your employment contracts

According to the Basic Conditions of Employment Act (BCEA), you must include the following in your employee's contract:

  1. Your full name and address (as the employer);
  2. Your employee's name and his occupation (or a brief description of the work you're hiring him for);
  3. The place of work. If your employee's required to work at more than one location, you must say so;
  4. The date on which employment began;
  5. Your employee's ordinary hours and days of work;
  6. Your employee's wage or salary, or the rate and method you use to calculate this;
  7. The rate of pay for overtime work;
  8. Any other cash payments your employee's entitled to;
  9. Any payment in kind your employee's entitled to and the value of these. For example instead of paying your employee R5 000 in cash, you give him a computer valued at R5 000. 'In kind' means you get the same value, but you're not getting the money;
  10. How often you'll pay remuneration;
  11. Any deductions to be made from the employee's remuneration;
  12. The leave you'll give your employee;
  13. The notice period required to terminate employment. If employment's for a specified period, include the date the contract expires;
  14. A description of any council or sectoral determination that covers you. This doesn't apply if you have less than five employees.
  15. Any period of employment with a previous employer that counts towards the current period. This doesn't apply if you have less than five employees; and
  16. A list of any other documents that form part of the employment contract. For example, company policy documents, grievance and disciplinary procedures. Again, this doesn't apply if you have less than five employees.

Make sure your employment contracts contain these 16 items. If you get this wrong, you could end up being audited by SARS. And no one wants to deal with SARS more than they already have to.

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