When the need to revitalise the South African economy is the topic of discussion, reference is often made to the rigidity of South African labour laws as a potential contributory cause for the persistent lack of economic growth, investment and job creation in South Africa. In 2019, South Africa was ranked by the World Economic Forum ("WEF") as 129th out of 141 countries for flexibility in hiring and firing practices in its World Competitiveness Report.
Reform of South Africa's labour laws is often referenced as an avenue to stimulate job creation and improve investment opportunities. The rate of unemployment (recently reported at a record high of some 34%) is truly alarming. What is particularly concerning is not just the actual unemployment numbers but the trajectory of the unemployment crisis over decades. The IMF predicts that unemployment in South Africa will worsen further to 38.6% by 2026.
Read part 1 of our article on retrenchment protection in South Africa, and part 2 for our recommendations for improvement, in Business Law and Tax.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
