The new Code of Good Practice: Dismissal (the Code), came into effect on 4 September 2025. It replaces the previous codes relating to dismissal and retrenchment. While not much has changed, we highlight a few aspects that are worth mentioning. 

Small businesses

The Code places more emphasis on the fact that small enterprises may follow simpler, less formal processes. It acknowledges that they face constraints (e.g. may not have an HR Department or people with skills and experience in dealing with the dismissal of employees).

Dismissal for misconduct

The Code provides more detailed guidelines on the considerations that apply before a decision is made to dismiss an employee.

Probation

Previously the purpose of probation was limited to the evaluation of an employee’s work performance. The purpose has now been extended to include “suitability for employment”. Other aspects, such as incompatibility and misconduct, may now also be considered during the evaluation.

Unsatisfactory work performance after probation

The Code points out that it is not always necessary to warn an employee of potential dismissal due to poor performance. In line with developments in case law, prior warning may not be necessary in cases involving –

• managers or senior employees whose experience and professional judgment equip them to assess the adequacy of their own performance; or
• employees with highly specialised skills, where a deviation from expected standards could result in serious consequences.

Other forms of incapacity

The Code has extended the scope of incapacity to include other factors preventing an employee from performing their duties, such as imprisonment. It also mentions incompatibility as a form of incapacity that may justify dismissal.

Retrenchment

The Code does not add much, but explains what may be regarded as legitimate reasons for retrenchment, as well as the process that needs to be followed. A helpful addition is a list of aspects that need to be covered by the notice of intended retrenchment to affected employees.

Unprotected strikes

To align with developments in case law, the Code has been revised to include updated guidelines and procedures governing unprotected strike action. These revisions reinforce the duty to consult with the relevant trade union, or—where no union is present—with designated employee representatives or leaders involved in the strike.

The Code is available here 

Written by Jan Truter for www.labourwise.co.za