On 4 September 2025, the Minister of Employment and Labour published a new Code of Good Practice: Dismissal. It replaces the Code that had sat in Schedule 8 to the Labour Relations Act 66 of 1995 (LRA) for almost three decades, and it now applies to every dismissal for misconduct, poor performance, incapacity and operational requirements.
For large employers, the new Code is more than a technical update. CCMA commissioners and Labour Court judges are required to take a Code of Good Practice into account when deciding whether a dismissal was fair, so disciplinary codes, performance management systems and incapacity policies that were built around the old Schedule 8 now need to be checked against the new text. The Labour Relations Amendment Bill published in February 2026 also proposes formally repealing Schedule 8, confirming that the new Code is the reference point going forward.
This article sets out what has changed and what employers with established HR frameworks should review.
What kind of document is the Code?
A Code of Good Practice is guidance, not legislation. It does not create rigid rules, and departures from it are permitted where there is a good reason. But section 203(3) of the LRA requires anyone interpreting or applying the Act to take relevant codes into account, and section 188(2) requires anyone deciding whether a dismissal was for a fair reason to consider them. In practice, an employer that ignores the Code without explanation will struggle to defend a dismissal.
The main changes
Case law written into the text
The old Code was short and general. Over 25 years, the courts filled the gaps with detailed principles on consistency, progressive discipline, derivative misconduct, performance management and accommodation of ill employees. The new Code incorporates much of that jurisprudence directly, with more detail and practical examples. For employers, this narrows the room for argument about what the standard is.
Misconduct: rules, consistency and proportionality
The Code places weight on three questions: was the rule clear and known, has it been applied consistently, and is dismissal a proportionate response? It encourages corrective and progressive discipline for less serious offences, while confirming that serious misconduct, such as dishonesty or violence, may justify dismissal for a first offence. Large employers with multiple sites should pay particular attention to consistency, because different managers applying the same code differently is one of the most common reasons dismissals are overturned.
Poor performance: training and time to improve
The Code expects employers to set clear standards, give feedback, provide training or guidance and allow a reasonable time to improve before dismissal is considered. The standard is applied with more flexibility for senior and managerial employees, who can be expected to meet known standards with less hand-holding, but the employer must still be able to show that the employee knew what was required and was given a fair opportunity.
Incapacity: broader grounds and a stronger duty to accommodate
The new Code expressly deals with incapacity arising from ill health or injury, and also addresses incompatibility and imprisonment. It emphasises the employer’s duty to investigate the extent of the incapacity and to consider alternatives to dismissal, such as adapted duties or alternative positions, with a particular emphasis on work-related illness and injury.
Flexible procedure, but the right to respond remains
The Code continues the move away from criminal-style hearings. A formal enquiry is not always required, and procedures may be less formal where circumstances justify it, provided the employee is told of the allegations and given a proper opportunity to respond before a decision is made. The February 2026 Labour Relations Amendment Bill proposes writing this core requirement into the LRA itself.
Small employers
The Code contains a dedicated section allowing small businesses to follow simpler processes. Large employers should not assume that the same latitude applies to them. Commissioners will expect a sophisticated employer with an HR function to follow its own procedures.
Operational requirements
For retrenchments, the Code stresses transparent consultation, disclosure of selection criteria and meaningful engagement with affected employees and unions. This sits alongside sections 189 and 189A of the LRA, which continue to set the statutory process. See our article on getting the section 189 process right.
Why this matters more for large employers
- Volume. Large workforces generate more disciplinary cases, so a weakness in the disciplinary code is repeated across many matters.
- Collective agreements. Many large employers have disciplinary procedures agreed with recognised unions. Where these conflict with the new Code, they may need to be renegotiated rather than simply updated.
- Consistency across sites. Employees and unions can compare sanctions across regions and business units.
- Precedent effect. A poorly handled case at one site can be cited by employees elsewhere.
A review checklist
- Compare your disciplinary code and procedure with the new Code, clause by clause.
- Update references to “Schedule 8” in policies, contracts, collective agreements and templates.
- Review your sanction guidelines for proportionality and progressive discipline.
- Check that your performance management process documents standards, feedback, support and time to improve.
- Update incapacity and ill-health procedures to reflect the duty to investigate and accommodate.
- Decide where less formal procedures are appropriate, and document the reasons.
- Engage with recognised unions where procedures are contained in collective agreements.
- Train line managers and chairpersons on the new Code, with an emphasis on consistency.
- Audit a sample of recent disciplinary outcomes for consistency across sites.
How O’Reilly Law can help
We review and redraft disciplinary codes, performance and incapacity policies against the new Code, advise on changes to procedures contained in collective agreements, train managers and chairpersons, and represent employers in the CCMA, bargaining councils and the Labour Court.
Contact us to review your disciplinary framework against the new Code.
Related reading: Retrenchments: getting the section 189 process right · Harassment in the workplace: employers’ duties
This article is general information and not legal advice. Correct as at November 2026.