A recent case involving Mamelodi Sundowns highlights the importance of understanding clawback provisions for both employees and employers. <\/p>\n\n\n\n
In August 2025, the Johannesburg High Court delivered a judgment on the enforceability of a clawback clause. <\/p>\n\n\n\n
This refers to a contractual term that makes provisions for a company to recover certain monies, bonuses or other incentives that were paid to an employee under a specific circumstance. <\/p>\n\n\n\n
This should be distinguished from a malus clause, which requires repayment of unearned benefits or remuneration if employment ends early. <\/p>\n\n\n\n
Imraan Mahomed, Thato Maruapula and Ayesha Karjieker from Cliffe Dekker Hofmeyr said that either a clawback or malus clauses need a \u201ctrigger event\u201d to be invoked. <\/p>\n\n\n\n
A court case involving South Africa\u2019s most successful football club, Mamelodi Sundowns, and its former head coach, Pitso Mosimane, deals with the issues of a clawback clause. <\/p>\n\n\n\n
For this case, the \u201ctrigger event\u201d was Mosimane’s resignation four months into a 48-month contract. <\/p>\n\n\n\n
Sundowns sought close to R8 million repayment from Mosimane or his intermediary, MT Sports. <\/p>\n\n\n\n
The sum was the portion of the intermediary\u2019s commission which was paid upfront, with the employment contract and intermediary agreement containing clawback clauses obliging pro-rata repayment if the relationship ended early.<\/p>\n\n\n\n
Mosimane was forced to pay close to R8 million to Sundowns in agents\u2019 commission fees and interest after he moved to an Egyptian rival, Al Ahly, in 2020. <\/p>\n\n\n\n
The experts said the ruling affirmed a long-standing commercial stance that clawback clauses can be enforced when they are clearly drafted, freely agreed to, and abide by public policy. <\/p>\n\n\n\n
The case’s key issue was whether clawback clauses are valid and enforceable, especially in the context of early termination of a contract. <\/p>\n\n\n\n
The court said that clawback clauses are enforceable where they are clearly drafted, agreed to by the parties and not contrary to public policy.<\/p>\n\n\n\n
It noted that freely and voluntarily concluded contracts must be honoured and highlighted that the clawback clauses in both the employment and intermediary agreements were negotiated at arm’s length, with both parties having legal advice to understand their implications. <\/p>\n\n\n\n
The court rejected arguments that the clawback provisions were unreasonable, discriminatory or constitutionally unenforceable.<\/p>\n\n\n\n
The court said that requiring pro-rata repayment of amounts paid is a legitimate risk-mitigation tool, particularly if large upfront payments are made.<\/p>\n\n\n\n
The court added that such provisions must be expressly included in the contract and that any waiver or variation must be in writing, in accordance with non-variation clauses.<\/p>\n\n\n\n
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