The Code of Good Practice: Dismissal was issued under Schedule 8 of the Labour Relations Act (LRA) and served as a guiding framework for fair dismissal processes that arbitrators and courts should consider when deciding on the fairness of dismissals. On 4 September 2025, the Department of Employment and Labour published a revised Code of Good Practice: Dismissal, bringing with it significant updates that reshape how employers approach both misconduct-related dismissals and probationary employment. While much of the core philosophy remains intact, the new Code consolidates the previously separate codes for misconduct, incapacity and operational requirements into a single more coherent document. This newsletter unpacks the key developments found in Part 1 of the Code. These changes call for more structured internal practices, a heightened emphasis on employee development, and a clear understanding of what constitutes fair and lawful dismissal in today’s workplace.

Key Themes from Parts A to E of the New Code:

  • Enhanced Procedural Fairness: The new Code encourages informal and corrective disciplinary approaches before taking formal steps. Employers may deviate from formal procedures when it is justified to do so. The Code requires that employees are informed of allegations in writing, given time to respond and allowed to be represented by either a union or fellow employee. Dismissals should furthermore be a last resort which is reserved for serious or repeated misconduct. 
  • Small Business Flexibility: The New Code gives small employers practical dispensations, whilst acknowledging that resources may be limited and that intensive processes may be unreasonable. Arbitrators must accordingly take this into account when determining fairness of dismissals for small business.
  • Expanded Sanctioning Criteria: When determining an appropriate sanction, employers are required to weigh up the nature and severity of the misconduct, the employee’s role and past disciplinary record, progressive discipline, the employee’s admission of guilt and co-operation in the process and the impact on the operations of the business.
  • Circumstances of Employee: The Code requires that dismissal decisions must be reasonable and must further consider contextual factors such as employee circumstances.
  • Probation: The Code provides clarity on managing probation, and allows a more flexible approach for underperforming employees, and employees who are unsuitable for the role. Employers must provide feedback and allow employees an opportunity to improve before dismissing them. New employees have a three-month qualifying probation period during which rules are relaxed slightly. Under the old Code, probation was primarily focused on assessing an employee’s performance and whether they met the required standards for the role. The new Code broadens the scope of probation to include suitability for the position. This includes factors like attitude, conduct, cultural fit, and interpersonal compatibility. In addition, the new Code clarifies that employers must still follow fair procedures before dismissal during probation. These include giving feedback, guidance, and a chance to improve. These processes may be less formal than for permanent staff. Employers also need to ensure that probation periods are clearly stated in employment contracts, and that any extension of probation is properly justified and communicated.
  • Incapacity: Incapacity grounds are extended beyond illness and now include incompatibility, substance abuse and imprisonment. There is an emphasis on exploring alternatives short of dismissal including offering the employee support or suggesting rehabilitation.
  • Operational Requirements: Retrenchment guidelines are fully integrated into a single Code. These include aspects such as consultation, selection criteria, severance pay and re-employment obligations. A standard template for retrenchment notices is furthermore included.
  • Industrial Action: The amendments provide clearer guidance on dismissals due to an unprotected strike. Employers are required to consult with trade unions, issue clear ultimatums, and fairly consider the demands and conduct of the employees.

What’s New or Different?

With the new Code, there is a stronger emphasis on accessibility, as the Code must be applied in a manner that is accessible, easy to understand, and simple. Employees are also explicitly entitled to be assisted by a trade union representative or fellow employee, with emphasis on support during internal processes. Informal processes are acceptable for minor infractions, while more serious matters require structured procedures. Importantly, notices may now be served electronically if appropriate and accessible to the employee.

Substantive Fairness for Misconduct

As was the case with the previous Code of Good Practice, employers wishing to discipline an employee for misconduct must assess:

  • Whether an employee contravened a rule or standard regulating conduct in the workplace;
  • Whether the rule was valid and reasonable and whether the employee knew or could reasonably be expected to know the rule;
  • The importance of the rule, whether the rule was consistently applied, and the actual or potential harm or damage caused by the employee’s contravention of the rule; and
  • Whether dismissal was an appropriate sanction under the circumstances.

Procedural Fairness

As was the case with the previous Code of Good Practice, procedural fairness requires:

  • Clear notice of allegations
  • Reasonable time to prepare
  • Opportunity to be heard
  • Assistance from a representative
  • Written communication of the outcome
  • Proper record-keeping

Implications for Employers

It is now more imperative that employers review their internal disciplinary codes to ensure alignment with the new structure and procedural guidance, and that they ensure that managers and HR understand the emphasis on informal resolution for minor issues but follow formal processes for serious cases. As always, employers are also urged to maintain thorough disciplinary records, as documentation remains essential to defending dismissals at CCMA, various Bargaining Councils as well as the Labour Court.

Conclusion

The new Code consolidate best practices while placing renewed emphasis on fairness, clarity, and accessibility. Employers must ensure both the reason for dismissal and the process followed are defensible, consistent, and legally compliant. Probation under the new Code is a period of mutual evaluation, not a loophole. Employers must engage in structured, fair, and transparent processes that support the employee and justify any decision to dismiss.

We encourage employers, IR/HR professionals, and legal practitioners to engage with these developments and share their insights.