Service Level Agreement South African Law

According to Michalsons SLA Guide (, an SLA is “an agreement describing the (non-product) services that one company will make available to another. If goods are supplied, an SLA is not the right deal. This is a kind of contract and, in the IT context, an IT contract. Once service levels have been determined, it is necessary to deal with the consequences of non-compliance with this and the amount of compensation must be defined. Negotiations often focus on the compensation that the service provider must pay in the event of a service failure (whether in the form of penalties, service credits or damages). Negotiating service levels involves a trade-off between the ideal list of customer requirements and the need to prioritize them relative to what is realistically achievable. Measuring performance can involve significant negotiations. It is necessary to strike a balance to ensure the desired levels of performance without imposing such tight restrictions on the service provider that they hinder the development of a creative and effective working relationship. Chetty: “Escalation clauses are crucial for the IOC. CIOs are often extracted from the day-to-day engagement with IT service providers.

The IOC must be aware of when service delivery and performance problems are to worsen. A combination of legal and technical skills is required to establish the necessary requirements. We are legal experts and we understand technology and the ICT sector, which puts us in an excellent position to create a service level agreement for IT-related services. Typically, we design a service level agreement consisting of two components, but it can contain everything in one document: in an industry providing services to parties that may or may not have a thorough understanding of the services provided and the technologies used, service level agreements (SLAs) provide a middle ground in which the terms of engagement can be clearly designed. Service levels are at the heart of the relationship, as they define the (agreed) criteria that objectively allow you to prove that the quality of service you want has been achieved. There is no generic “Service Level” agreement. What for? The content depends entirely on what the actual service is. It can be any service you want to measure (from maintaining potted plants in your office to hosting your IT infrastructure). It is necessary to identify and quantify the most important activities that will be required. Perfect performance is not a realistic criterion. It should be a living document. It should not be handed over as soon as it is signed so that it is never mentioned again.

This should be remembered and constantly updated when services change. “In practice, any action before our courts is a long and costly process to compel the service provider to provide the service, or even force the customer to pay.

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