A Department of Employment and Labour inspector can arrive unannounced, ask for your employment records, and interview your staff. The findings cluster around the same six issues in almost every sector: underpayment against a minimum, unpaid hours, unlawful deductions, missing written particulars, employees not registered for UIF, and no COIDA cover. Every one of them is a documentation problem you can fix in advance, and none of them can be fixed on the day.
The sectors under most pressure are hospitality, security, cleaning, agriculture and construction — but the checklist is the same everywhere.
What happens in an inspection?
Broadly, an inspector will identify themselves, ask to see your employment records, walk the premises, and speak to employees — often without you present.
That last part is the one owners underestimate. Your records say one thing; what a waiter or a cleaner tells an inspector about their hours, their deductions and their pay is independent evidence. Where the two do not agree, the records are not automatically believed.
Where contraventions are found, the ordinary route is a compliance order requiring you to fix them within a stated period, with escalation — including to the Labour Court — where you do not.
A compliance order is not the worst outcome. The worst outcome is an underpayment finding calculated backwards across every affected employee for the period concerned.
The six findings
1. Underpayment against the applicable minimum
The most common finding, and usually accidental.
Employers apply the national minimum wage when a sectoral determination or bargaining council rate applies and is higher. Or they apply last year's schedule. Or, in sectors where rates vary by area, they apply one rate everywhere.
Establish which instrument governs your employees before anything else — the national minimum wage, a sectoral determination, or a bargaining council agreement. Then apply the current schedule. See the national minimum wage explained.
2. Hours worked and not paid
Overtime not paid at the premium. Sunday work paid at the ordinary rate. Public holidays not paid — including the entitlement of an employee who did not work a public holiday falling on a day they would ordinarily work.
This is where a time record earns its keep. Without one you cannot demonstrate what was worked, and the employee's account stands.
3. Unlawful deductions
Breakages, till shortages, walkouts, uniforms, training costs, cash losses.
Deductions from wages are tightly regulated, and most informal ones are unlawful. This is so normalised in retail and hospitality that owners are genuinely surprised to be told.
Check every deduction currently running on your payroll against what is actually permitted, and stop the ones that are not.
4. No written particulars of employment
The easiest finding for an inspector to make, because it is binary — the document exists or it does not.
Every employee must be given written particulars, including part-time and short-term staff, from day one. See what must be in an employment contract.
5. Employees not registered for UIF
Almost always the short-term and "casual" staff, who were going to be here briefly and then stayed, or left before anyone did the paperwork.
There is no informal category that removes this. See casual staff and UIF.
6. No COIDA registration
No minimum turnover, no minimum hours, no exemption for part-time or casual work. One employee is enough. See what is COIDA.
What should be in the file, ready?
An inspector will ask for some or all of this. Keeping it current is the whole exercise — there is no version of this you can assemble on the day.
| Document | For whom | Note |
|---|---|---|
| Written particulars of employment | Every employee | Including part-time, short-term, "casual" |
| Time records | Every employee | Actual hours worked, signed. Not the roster |
| Payslips | Every employee | Showing hours, rate, deductions and their basis |
| Payroll records | All | Reconciling to the payslips and to what was paid |
| UIF registration and returns | All | Everyone, from day one |
| COIDA registration | The business | Plus the current Return of Earnings |
| Leave records | Every employee | Annual, sick, family responsibility |
| The applicable wage schedule | The business | Current sectoral determination or council schedule |
| A deductions record | Where any apply | With the basis for each |
| The BCEA summary | Displayed | Where employees can see it |
Two rows matter more than the rest. The time record, because it is the evidence for hours, overtime and Sundays. And the written particulars, because their absence is the single easiest contravention to establish.
What to do this month
1. Establish which wage instrument applies to you, and confirm you are on the current schedule. If rates vary by area and you operate in more than one, check each.
2. Audit your deductions. List every deduction currently running on your payroll and satisfy yourself each is permitted. Stop the ones that are not.
3. Reconcile everyone paid against everyone registered for UIF. This single check catches most of finding number five.
4. Check that written particulars exist for every person on the payroll, including anyone who started last week.
5. Check your time records reflect actual hours, not the roster, and that somebody signs them.
6. Confirm COIDA registration and that the Return of Earnings is current.
7. Fix what you find, and fix it forward. Where you discover an underpayment, correcting it going forward is necessary but not sufficient — take advice on the historic position, because an inspector will calculate backwards.
What if an inspector arrives today?
Be cooperative and be accurate. Obstruction makes everything worse, and inspectors have statutory powers of entry and inspection.
Give them what they ask for. Do not construct anything on the spot — a document produced during an inspection that did not exist that morning is a much larger problem than the gap it was meant to fill.
Take notes. What was asked for, what was provided, who was interviewed, what was said.
Ask for the findings in writing, and read the compliance order carefully — what it requires and by when.
Then take advice before responding, particularly where an underpayment calculation is involved. The numbers in a compliance order are not always right, and they are worth checking — but that is a job for someone who knows the instrument that applies to you.
Frequently asked questions
Can a labour inspector arrive without warning? Yes. Inspectors have statutory powers of entry and inspection, can require production of employment records, and can interview employees — often without the employer present.
What do labour inspectors check most often? Underpayment against the applicable minimum, hours worked and not paid, unlawful deductions, missing written particulars of employment, employees not registered for UIF, and absent COIDA registration.
Which sectors are inspected most? Hospitality, security, cleaning, agriculture and construction come under the most pressure, though the checklist is the same in every sector.
Can I deduct breakages or till shortages from an employee's wages? Deductions from wages are tightly regulated and most informal ones are unlawful. This is a common finding in retail and hospitality, where the practice is widespread.
Do part-time staff need written particulars of employment? Yes. Every employee must be given written particulars, including part-time, short-term and so-called casual staff, from day one.
Is a roster the same as a time record? No, and the distinction matters. A roster is a plan. A time record is evidence of what was actually worked, and it is what supports your position on overtime, Sunday work and public holidays.
What is a compliance order? A formal instruction to remedy identified contraventions within a stated period, with escalation available — including to the Labour Court — where an employer does not comply.
Should I fix an underpayment I discover myself? Yes, and take advice on the historic position as well. Correcting it going forward is necessary but an inspector will calculate backwards over the period affected.
The file either exists or it does not
Nothing on this page can be produced on the morning an inspector arrives. It is all documentation that either has been kept as you went, or has not.
Smartbook runs payroll for South African businesses in the sectors under most pressure — the correct wage instrument applied and kept current, hours and premiums calculated from actual time records, everyone registered for UIF from day one, and the COIDA Return of Earnings filed from complete records.
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Last reviewed: 28 August 2026. Written by the Smartbook team — SAIPA and SAICA accredited, SARS registered tax practitioners. Inspection powers, procedures and the rules on deductions are set out in labour legislation — take advice on your specific position, particularly where an underpayment calculation or compliance order is involved. General guidance, not legal advice.
Primary sources: Department of Employment and Labour · Basic Conditions of Employment Act 75 of 1997 · National Minimum Wage Act 9 of 2018 · Unemployment Insurance Act 63 of 2001 · Compensation Fund