The South African government introduced the Labour Relations Act and Basic Conditions of Employment Act to balance the interests of employers and employees. It is important that these labor laws do not negatively impact small businesses and the country's GDP. There are conflicting reports on how the laws affect small businesses. To develop effective policies, the government needs to understand, define, and measure the impact of labor laws on small businesses through evidence collected from employers. The study found that labor legislation does not heavily impact small firms, so extensive measures are not needed to correct the framework of regulated flexibility.

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ABSTRACT
The South African government has attempted to find a balance of interests between the
employer and the employee by the introduction of the Labour Relations Act in 1995 and the
Basic Conditions of Employment Act in 1997. It is critical to the health of the South African
economy that these labour laws do not impact small businesses to the extent that the Gross
Domestic Product of the country is negativelyaffected. There are conflicting reports as to how
these labour laws affect small businesses. It is therefore important for government to be able
to understand, define and measure the impact of its labour laws on small businesses, in order
for it to strategise corrective measures, which may include reconsidering the application of
the legislative directive, regulated flexibility, if required. The study was limited in the sense
that it was solelybased on evidence collected from employers. An interpretivist approach was
applied as a research methodology to data collected through in-depth interviews. The main
findings of the empirical analysis demonstrate that labour legislation does not heavily impact
small firms. It was thus determined that extensive measures were not needed with regard to
correcting the framework of regulated flexibility.
Keywords:
Small firms, labour market, labour legislation, human resource management in SMEs