Legal & Risk: What Businesses Need to Watch
2026-05-18
South African and UK businesses must navigate evolving compliance challenges, particularly in employment practices and corporate governance. Here are two critical trends to monitor.
A recent case cited by Cliffe Dekker Hofmeyr (CDH) warns that businesses employing foreign workers face dual risks under South Africa’s Immigration Act 2002 and Labour Relations Act 66 of 1995. A Zimbabwean bakery manager was terminated due to unauthorized employment status, exposing the employer to penalties under the Immigration Act for non-compliance with work permit requirements and potential unfair dismissal claims under the LRA.
Compliance Action: Businesses must audit all foreign worker contracts to ensure work permits are valid, aligned with the Employment of Foreigners in South Africa Regulations, and that employment terms adhere to LRA provisions on minimum wage, working hours, and termination processes. Failure to verify documentation may result in fines or reputational harm.
A legal challenge by a Nationwide customer highlights tensions in UK corporate governance. Nationwide, a mutual bank, faces scrutiny over its board composition despite recent reforms. Only three member-supported candidates have been elected to its board in decades, raising questions about whether its governance structure aligns with the UK Corporate Governance Code and the Companies Act 2006. The case could trigger broader reforms if courts rule that member voting rights are inadequately protected.
Compliance Action: UK-based businesses with similar governance structures should review their board composition and member engagement policies to ensure compliance with the Companies Act 2006 and the Corporate Governance Code. This includes ensuring transparency in member voting processes and demonstrating accountability to stakeholders.
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