Legal updates and opinions
News / News
How binding is a CCMA settlement agreement?
Written settlement agreement at the CCMA
If an employee enters into a written settlement agreement at the Commission for Conciliation, Mediation and Arbitration (“CCMA”) on the advice of her representative, can she subsequently escape the agreement on the basis that she was duped into doing so by her representative? Can she do so if she entered the agreement under duress or as a result of the undue influence of her representative?
Ordinary laws of contract
In Ulster v the Standard Bank of South Africa Ltd (C 647/2012) [2013] ZALCCT 3 (15 February 2013), the Labour Court was faced with this question. It held that the ordinary laws of contract will apply. Therefore a settlement agreement can only be set aside if it is successfully shown that the employee was placed under the type of duress required in common law. In this case, the employee was a bank manager with 30 years’ experience, she was educated and well-informed.
It was clear she understood the nature of contracts. She understood the nature of the proceedings and agreed to sign the settlement agreement. In the circumstances, she entered into the agreement with open eyes, fully aware of its consequences, and should be bound by the terms thereof.
Common law position on the effect of concluding an agreement
Whilst this decision confirms the common law position on the effect of concluding an agreement, it does highlight that a settlement agreement might not stand up to scrutiny if the employee can show that he or she did not understand the legal significance of signing such an agreement, was not well informed, educated or experienced in such matters. A way to avoid this result would be to ensure that the terms of a settlement agreement are explained to the employee by the Commissioner before he or she signs the agreement.
It may even be advisable to have the agreement translated for the employee if his or her first language is different to that in which the agreement is drafted.
Read more on the CCMA pronounces on mandatory vaccination policy.
Latest News
What you need to know now to protect your brand in China
by Donvay Wegierski, Director Brand owners take note. Effective 2027 China will amend its Trade Mark Law. Efforts to curb [...]
A tale of two disaster declarations
by Naledi Motsiri, Director and Nothando Nyoni, Associate In recent years, South Africa has declared two national disasters aimed at [...]
Substance over form: Structuring black private equity funds under the B-BBEE framework: The importance of active management
by Dylan Cunard, Director 1. Introduction 1.1. The growth of black-managed private equity ("PE") funds in South Africa is a [...]
Making South Africa home?
by Doelie Lessing, Director and Head of Tax and Private Wealth, Luke Magerman, Senior Associate and Mike Searle, Candidate Attorney [...]
Trust regulation to be overhauled
by Ernest Mazansky, Director, Werksmans Tax (Proprietary) Limited Introduction On 7 August 2026 a draft Bill, the Regulation of Trusts Bill, 2026 [...]
South Africa’s crypto crackdown: Draft Manual brings cross-border crypto asset transactions under exchange control
by Natalie Scott, Director and Head of Sustainability The South African Reserve Bank ("SARB") and National Treasury published the draft [...]
