Illegal employees in community schemes: What every body corporate needs to know following the June 2026 immigration protests
07 July 2026 | Mariska Rall
The events leading up to and including the anti-immigration protests of 30 June 2026 have placed the employment of undocumented foreign nationals firmly under the national spotlight. Public debate has focused on concerns relating to unlawful immigration, employment opportunities for South Africans, pressure on public resources and the enforcement of immigration legislation. At the same time, government has emphasised that immigration enforcement must take place within the framework of the Constitution and the rule of law, while condemning xenophobic conduct and violence directed at foreign nationals.
Whilst these developments have generated significant public attention, trustees and managing agents of community schemes should avoid becoming embroiled in political rhetoric and instead focus on the legal obligations applicable to bodies corporate. The issue is not whether foreign nationals may be employed. The real question is whether bodies corporate have implemented appropriate governance and compliance measures to ensure that individuals performing services within their schemes possess the necessary legal authorisation to do so.
With government signalling increased enforcement action and proposing substantially harsher penalties for the employment of undocumented foreign nationals, trustees can no longer regard immigration compliance as a peripheral administrative issue. It has become a core governance and risk-management consideration for community schemes.
Legal framework governing the employment of foreign nationals:
The employment of foreign nationals in South Africa is mainly regulated by the Immigration Act 13 of 2002 and the Employment Services Act 4 of 2014. The key section to be cognisant of is the fact that section 38 of the Immigration Act prohibits any person from employing:
(a) an illegal foreign national,
(b) a foreign national whose immigration status does not authorise employment, or
(c) a foreign national employed in a manner inconsistent with the conditions of that person’s visa, permit or status.
The Immigration Act further places a positive obligation on employers to make a good-faith effort to verify the immigration status of foreign employees. The obligation is ongoing and extends beyond the recruitment process as employers are expected to take reasonable steps to ensure that individuals employed by them remain lawfully entitled to work in South Africa.
Why should community schemes be concerned?
Community schemes often engage individuals in positions that have historically attracted close scrutiny from labour and immigration authorities, including, inter alia - security officers, gardeners, caretakers’ maintenance workers etc.
While many bodies corporate contract these services through third-party providers and other directly employ the staff, it is imperative that there is legislative compliance irrespective of whether there is employment through third parties or through the body corporate itself. Trustees frequently assume that outsourcing employment functions to contractors eliminates legal risk. However, while the primary employment obligations may rest with the contractor, body corporate governance requires trustees to exercise reasonable oversight over the service providers appointed by the scheme.
From a risk mitigation perspective, trustees should be concerned about and take note of regulatory investigations, contractual disputes, reputational harm, service delivery interruptions, increased scrutiny from residents and owners, and compliance failures by contractors operating within the scheme. The recent public focus on undocumented employment has substantially increased the likelihood that these issues will come under closer examination.
Contraventions of the Immigration Act may give rise to serious consequences under Section 49 of the Immigration Act and creates criminal offences for persons who intentionally or unintentionally employ undocumented foreign nationals or who employ foreign nationals in contravention of the Act. Depending on the circumstances, penalties may include fines and imprisonment.
Employers should therefore not assume that immigration compliance is merely an administrative requirement. Non-compliance may have significant legal consequences.
Proposed changes and increased enforcement:
Recent public discussion has focused on the Employment Services Amendment Bill, which seeks to increase penalties for employers who unlawfully employ undocumented foreign nationals. According to reports referenced by the Department of Employment and Labour and various media publications, the Bill proposes:
fines of up to R100 000.00 per undocumented worker for a first contravention;
substantially increased penalties for repeat offences;
fines of up to R1 million or a percentage of turnover in cases involving multiple contraventions, and
additional enforcement powers.
To date, these penalties are only proposed for consideration and have not yet been enacted into legislation. However, the trustees should nevertheless appreciate the clear policy direction reflected by these proposals, namely a significantly more aggressive enforcement approach towards employers who fail to comply with immigration requirements.
Labour law applicability?
One of the most common misconceptions is that a foreign national who lacks lawful work authorisation has no labour law protections. This assumption is incorrect.
South African courts have repeatedly recognised that foreign nationals may still fall within the definition of "employee" for purposes of labour legislation and may enjoy protection against unfair dismissal and unfair labour practices. The fact that an employee's immigration status may be irregular does not automatically remove the protections afforded by labour legislation.
Accordingly, trustees and managing agents should exercise caution before terminating employment based solely on immigration concerns. In appropriate circumstances, specialist labour-law advice should be obtained to ensure that the body corporate complies with both immigration and labour legislation.
Trustee’s responsibilities:
The Sectional Titles Schemes Management Act 8 of 2011 and its Prescribed Management Rules require trustees to act honestly, in good faith and in the interests of the body corporate when managing the affairs of the scheme. Although immigration legislation does not expressly impose a duty upon trustees to police immigration enforcement, trustees are expected to exercise reasonable care and diligence when engaging employees and appointing contractors.
From a governance perspective, trustees should ensure that:
(a) employment practices comply with applicable laws,
(b) service providers are appropriately vetted,
(c) contractual protections are in place,
(d) compliance records are maintained, and
(e) compliance risks are actively monitored.
Failure to implement reasonable compliance measures may expose the scheme to avoidable legal, operational and reputational risks.
Service providers:
For many community schemes, the greatest exposure does not arise from direct employment, but from external contractors.
Security companies, cleaning contractors, gardening service providers and maintenance service providers frequently deploy personnel to schemes on a daily basis. Trustees should therefore ensure that procurement and contractor-management procedures include immigration-compliance safeguards.
Service agreements should include provisions requiring contractors to:
comply with all immigration and labour legislation;
verify employee documentation;
maintain appropriate records;
provide evidence of compliance when requested;
notify the body corporate of material compliance breaches, and
indemnify the body corporate against losses arising from the contractor's non-compliance.
These measures may not eliminate risk entirely, but they demonstrate responsible governance and a proactive compliance approach.
Practical compliance recommendations
Trustees should consider implementing a comprehensive compliance framework that includes conducting a workforce audit to identify all individuals rendering services within the scheme, whether employed directly or through third-party contractors. Where foreign nationals are engaged, the body corporate should obtain, verify and securely retain copies of the relevant documentation authorising employment in South Africa, while ensuring ongoing monitoring of permit and visa validity.
Trustees should further undertake the appropriate due diligence when appointing service providers by requiring written confirmation of compliance with immigration and labour legislation and incorporating suitable warranties and indemnities into service agreements. To ensure ongoing compliance, schemes should maintain a register of permit expiry dates, implement written policies regulating recruitment, verification procedures, contractor management and record retention, and managing agents should provide training to trustees and managing agents on their legal obligations and the distinction between lawful compliance measures and unlawful discriminatory conduct.
Finally, bodies corporate should maintain a clear and comprehensive compliance audit trail demonstrating the reasonable steps taken to verify compliance, thereby assisting the scheme in mitigating regulatory, operational and reputational risks should its employment practices come under scrutiny.
Conclusion
The increased focus on undocumented foreign nationals following the June 2026 protests should serve as a reminder to trustees that immigration compliance forms part of the broader governance obligations of a body corporate. Whether services are provided through direct employees or external contractors, trustees should ensure that appropriate verification procedures, contractual safeguards and record-keeping measures are in place to mitigate regulatory and operational risks.
Importantly, compliance must be approached in a manner that is both lawful and non-discriminatory. The objective is not to police immigration matters, but to ensure that the body corporate can demonstrate that it has taken reasonable steps to comply with applicable legislation and to manage potential exposure arising from the engagement of service providers and employees.
In an increasingly regulated environment, proactive compliance is far less costly than reactive intervention. Trustees who implement appropriate governance controls now will be better positioned to protect their schemes from legal, financial and reputational risks in the future.
About the Author:
Mariska Rall is an Admitted Attorney of the High Court and an Associate at Heerschop Pienaar Incorporated Attorneys.