Women have the same rights as everyone else in South Africa, for example, the rights to equal treatment in the workplace and to start their own businesses. Women in South Africa are highly encouraged to become entrepreneurs, however, a woman cannot start the right type of business without knowing what the different types are and how to start one.

What is a business?

  • Any person can start a business. Doing business usually involves the activity of buying and selling goods and services for a fee.
  • Certain businesses must have licenses and permits to do certain activities. For example, if a person wants to open a liquor store, the Liquor Act requires that person to get a licence to sell, distribute or make liquor.
  • The law says that businesses must register with the following institutions, where applicable:
    •     South African Revenue Services (“SARS”) – if a business is liable for tax, it must register with SARS as a taxpayer. Where a business pays remuneration to employees, it must deduct tax from these employees’ remuneration, which is called Pay As You Earn (“PAYE”).
    •     Department of Labour – if a business pays remuneration to employees, it will have to register with the Unemployment Insurance Fund (“UIF”), which protects employees who become unemployed.
    •     Bargaining Council – if a business falls within a bargaining council’s sector and area, it can register with that council and comply with all the terms of its collective agreement, including the prescribed minimum wages.
    •     Professional/industry controlling bodies – the law says that a business must register with a certain controlling body to conduct business of a certain profession or industry. For example, a builder has to register with the Master Builders South Africa (“MBSA”) to build.

What are the most common types of businesses?

  • The most common types of businesses a woman can start are:
  • A sole proprietorship is the simplest type of business. It is a business that has only one owner and that owner runs his/her business in his/her own name (no difference between owner and business). The owner of the business is entitled to all the profit (after tax) and liable for all the losses (debts and liabilities).
  • A partnership is created when two or more persons agree to do business together, by combining money, skill and other resources, with the view of making profit. The partners are equally and personally entitled to his/her share of the profit (after tax) and liable for his/her share of the losses.
  • A company is a collection of persons that do business for a specific purpose, either for profit or not (non-profit). A company is a legal person, which means it is taxed separately from its owners, who are called shareholders. The company has to pay all its debts.

How can a woman start and register each type of business?

  • Sole proprietorship – a person can simply start a sole proprietorship, there are no formalities or founding documents and it does not need to be registered.
  • Partnership – two or more persons must have the intention to enter into a valid partnership agreement to start a partnership. A partnership agreement can be in writing or verbal (spoken words). A partnership does not have to be registered.
  • Company – the persons must first decide what type of company they would like to start; a profit or non-profit company. Once this has been decided, a name can be reserved and then the founding documents may be lodged for registration at the Companies and Intellectual Properties Commission of South Africa.

What are some of the risks involved in each type of business?

  • Sole proprietorship – the business will stop existing when the owner dies; the owner is personally liable for the losses of the business; and the name of the business is not reserved or protected and can be stolen by another business.
  • Partnership – the partnership ends when a partner dies or is replaced; the partners are jointly and severally liable for losses; any one of the partners can be held liable; and they are not as stable as other businesses, like companies.
  • Company – it has to be registered and a fee must be paid; it has to comply with the Companies Act; it has more difficult decision-making procedures than other businesses; and it gets monitored strictly by many organisations, like the Companies Tribunal.

Do women have certain rights as employers/employees in a business?

  • Women who have their own businesses (“employers”) with employees, and women who work for businesses as employees, should understand their rights and responsibilities in the workplace.
  • Some important rights are, the right to maternity leave; the right not to be discriminated against; and the right not to be sexually harassed.

What is a woman’s right to maternity leave?

  • A pregnant employee is entitled to at least four months of maternity leave. However, the employer and employee may agree to more than four months of maternity leave.
  • Maternity leave may start at any time from four weeks before her expected delivery date (birth) or a date given by her medical practitioner, which is necessary for her health or the health of her child.
  • An employee may not return to work for six weeks after the birth of her child, unless approved by her medical practitioner.
  • An employee who had a miscarriage during the third trimester of her pregnancy or had a stillbirth, is entitled to maternity leave for six weeks after the miscarriage or stillbirth.
  • Unfortunately, an employee is not entitled to be paid her salary while on maternity leave. An employer may, however, have an internal policy, which provides for maternity leave and the payment of maternity leave benefits.
  • An employee may claim maternity leave benefits (UIF) from the Unemployment Insurance Fund (“Fund”), if she has been contributing to the Fund.

What is a woman’s right not to be discriminated against?

  • A woman, as an employee or job applicant, may not be discriminated against on grounds like her gender, race, pregnancy, marital status and so on.
  • However, an employer may discriminate against a woman because of affirmative action measures or as a result of specific requirements relating to the job.

What is a woman’s rights when it comes to sexual harassment in the workplace?

  • Sexual harassment is any unwelcome sexual attention, behaviour, suggestions, messages, or remarks of a sexual nature that offends, intimidates or humiliates an employee. It can also be a promise or reward for sexual deeds or a sexual threat.
  • An employer must investigate any complaint of sexual harassment against a woman, and take appropriate action against the responsible employee.
  • If an employer does not take any steps to stop the sexual harassment, the employee may hold the employer liable for it, and sue him/her/it.
Legal content disclaimer

The information contained on this website is aimed at providing members of the public with guidance on the law in South Africa. This information has not been provided to meet the individual requirements of a specific person and LegalWise insists that legal advice be obtained to address a person’s unique circumstances. It is important to remember that the law is constantly changing and although LegalWise strives to keep the information up to date and of high quality, it cannot be guaranteed that the information will be updated and/or be without errors or omissions. As a result, LegalWise, its employees, independent contractors, associates or third parties will under no circumstances accept liability or be held liable, for any innocent or negligent actions or omissions by LegalWise, which may result in any harm or liability flowing from the use of or the inability to use the information provided.