Labour Department warns employers could face up to R1m fines for hiring undocumented workers

Deputy Labour Minister Jomo Sibiya has warned that employers who repeatedly hire undocumented foreign nationals could face fines of up to R1 million per worker under proposed changes to the Employment Services Act.

Proposed penalties and enforcement steps

Sibiya told Newzroom Afrika that the proposed amendments would raise penalties from R100,000 for a first offence to R200,000 for a second offence and up to R1 million for a third offence. He said the department had intensified inspections as part of efforts to curb what he described as widespread non-compliance with labour laws.

Inspections, findings and examples

The department flagged a joint inspection in Johannesburg’s city centre that uncovered serious labour, health and safety violations, including workers allegedly being paid below the minimum wage and working without proper protective equipment. Inspectors also found unsafe food handling and electrical hazards at a butchery, which prompted the city to order its immediate closure.

Sibiya said inspectors found two undocumented foreign nationals from Benin and four from Zimbabwe during an operation the previous Friday. He also cited an operation in Cape Town in which 71 undocumented foreign nationals were arrested at one site.

Capacity constraints and planned recruitment

The department inspected more than 300,000 businesses during the 2025/26 financial year, Sibiya said, and currently has about 2,300 inspectors tasked with overseeing more than two million businesses. He added the government was recruiting 10,000 inspectors to increase enforcement capacity.

Sector focus and interdepartmental co‑operation

Sectors identified as priorities include hospitality, manufacturing, agriculture and retail, though inspections are being conducted across all sectors. Sibiya said co-operation with the Home Affairs Department, the South African Police Service and municipalities had strengthened enforcement operations.

“Our level of co-ordination has improved, as well as our agility, the speed and efficiency that we have brought in doing our work, but also the collaboration with Home Affairs and SAPS has made our work to be felt,”

Employer responsibilities and current penalties

Sibiya emphasised that employers are responsible for verifying foreign nationals’ documents with Home Affairs before employing them. He said employers in Johannesburg currently face a R10,000 fine for each undocumented foreign national they employ.

The department’s approach balances enforcement with protecting jobs. Sibiya said businesses found non-compliant were not necessarily closed permanently: they can be prohibited from operating until they correct violations, but may face permanent closure if they fail to comply.

Department priorities stated

• Ramp up inspections and enforcement to address widespread non-compliance
• Increase number of labour inspectors through recruitment
• Coordinate with Home Affairs, SAPS and municipalities to improve enforcement
• Target priority sectors including hospitality, manufacturing, agriculture and retail