How much notice must an employer give in South Africa?

Under section 37 of the BCEA: 1 week if the employee has been employed for 6 months or less, 2 weeks if more than 6 months but less than 1 year, and 4 weeks if 1 year or more (and for farm or domestic workers employed for more than 6 months).

Is notice pay the same as severance pay?

No. Notice pay compensates for the notice period the employer chose not to work out (pay in lieu of notice). Severance pay, under section 41, is an additional one-week-per-year payment owed only on retrenchment for operational requirements. Both can be due at the same time and are shown as separate lines on the final payslip.

Is notice pay taxed as normal salary?

Yes. Notice pay is ordinary remuneration and is taxed at the employee's normal PAYE rate on the payroll cycle in which it is paid. It is not eligible for the SARS retirement lump-sum tax table — that table is only for the severance benefit itself.

South Africa · BCEA section 37

Notice pay in South Africa: BCEA periods, pay-in-lieu and the final payslip

Notice pay is one of the most commonly miscalculated items on a South African final payslip — and it's almost always paid alongside severance, leave pay-out and a SARS tax directive. Here are the rules in plain English, with the formulas your payroll team should be using.

Statutory notice periods

1 week — if the employee has been employed for 6 months or less.
2 weeks — more than 6 months but less than 1 year.
4 weeks — 1 year or more (and farm / domestic workers after 6 months).

Notice must be given in writing, except to an employee who cannot read or write. A contract may provide a longer period — but never a shorter one than the BCEA minimum.

Pay in lieu of notice

Section 38 allows the employer to pay the employee for the notice period instead of requiring them to work it out. The amount equals the remuneration the employee would have earned over the notice period — basic salary plus regular allowances and benefits, calculated the same way as for severance.

Worked example

Lerato has 3 years' service and earns R24,000 basic + R2,000 cash transport allowance (total R26,000 per month). She's retrenched and not required to work her notice.

Notice period: 4 weeks
One week's remuneration: R26,000 × 12 ÷ 52 ≈ R6,000
Notice pay: R6,000 × 4 = R24,000
Severance pay (separate line): R6,000 × 3 years = R18,000

Interactive notice pay calculator (BCEA s.37 + s.38)

Estimate pay in lieu of notice using the BCEA notice periods and the same week's remuneration formula used for severance.

Monthly basic salary (R)

Gross monthly basic, before deductions.

Monthly cash allowances + benefits (R)

Regular allowances and employer contributions, same base as severance.

Completed months of service

Whole months only — partial months round DOWN. The BCEA bracket is set on completed months.

One week's remuneration: R 6 000,00
Statutory notice period: 4 weeks
Gross pay in lieu of notice: R 24 000,00

Step-by-step breakdown

Monthly remuneration = basic + allowances = R 26 000,00
One week's remuneration = monthly × 12 ÷ 52 = R 6 000,00
BCEA bracket (1 year or more · 4 weeks) → 4 notice weeks.
Pay in lieu of notice = weekly × weeks = R 24 000,00

Rounding: weeks are integers per BCEA s.37; Rand amounts shown to 2 decimals, internal values kept at full precision. A contract may set a LONGER notice period — never shorter.

Notice pay is taxed as ordinary PAYE — not under the SARS lump-sum table. Estimate only.

Get the final payslip done right

How notice pay is taxed

Notice pay is ordinary remuneration. It runs through the normal PAYE tables in the cycle in which it's paid — it does not qualify for the SARS retirement / severance lump-sum table. That table only applies to the severance benefit itself (source code 3901), processed against an IRP3(a) directive.

Need a clean final payslip?

Patuza processes notice, severance, leave pay-out and the IRP3(a) directive together — with the right SARS source codes — so the employee receives a single, correct payment and the year-end IRP5 reconciles first time.

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Related guides

Severance pay calculation (with calculator) →
BCEA s.41 formula, SARS lump-sum tax and an interactive calculator.
UIF contributions & claims →
1% + 1% UIF, ceiling, UI-19s and retrenchment claims.

General information based on the BCEA and SARS guidance current at publication. Not legal or tax advice.