South Africa Update: Latest amendments to the various national minimum wage rates

On 9 February 2021, the amended national minimum wage rates, set in terms of the National Minimum Wage Act (Act), which will take effect from 1 March 2021, were published in the government gazette. The national minimum wage rates were amended by the Minister of Employment and Labour.

The Minister reminded employees and employers that the minimum rates are a floor level below which no employees should be paid. Employers were further cautioned that it is unlawful to unilaterally alter hours of work and other conditions of employment, in implementing the national minimum wage.

The new national minimum wage is R21.69 per hour. This indicates an increase of approximately 4.48% in comparison with the minimum wage of R20.76 per hour in 2020. The national minimum wage amount payable for ordinary hours of work does not include:

• payment of allowances such as transport, tools, food, or accommodation;
• tips; and
• bonuses and gifts.

It is also notable that for the first time since the Act came into effect, farm workers’ minimum wage is on par with the national minimum wage of R21.69 per hour. This indicates an increase of approximately 16.11% when compared with the minimum wage rate of R18.68 per hour that was set for farm workers in 2020.

Despite these amendments to the national minimum wage, exceptions were provided for the following groups of workers and sectors:

Domestic workers

Domestic workers received the highest increase in percentage amongst affected sectors with a new amended minimum wage of R19.09 per hour. This indicates an increase of approximately 22.61% percent when compared with the R15.57 per hour minimum wage rate set for Domestic workers in 2020. The Domestic workers’ new amended minimum wage is 88% of the current national minimum wage.

Workers employed on an expanded public works programme

The new minimum wage for the above category of worker has been amended to be R11.93 per hour. This indicates an increase of approximately 4.46% when compared with the R11.42 per hour minimum in 2020. This new minimum wage rate is 55% of the current national minimum wage.

Learnership allowances

The increase on learnership allowances is determined by the national qualifications’ framework level.

Contract Cleaning, Wholesale and Retails Sectors

The increase in the national minimum wage means that wages prescribed in sectoral determinations that were higher than the national minimum wage at its promulgation, must be increased proportionally to the adjustment of the national minimum wage rate. The contract cleaning, wholesale and retail sectors’ wages, therefore, are to be upwardly adjusted by 4.5%.

BCEA earnings threshold adjusted

It should also be noted that the Minister has, in terms of Basic Conditions of Employment Act (BCEA), revised the earning threshold rate from R205 433.30 to R211 596.30, with effect from 1 March 2021. Employees earning remuneration greater than this amount are excluded from certain provisions of the BCEA which concern inter alia the regulation of working time, overtime, average working hours and meal intervals.

By Doctor Cithiand and Buhle Msweli, Tabacks, South Africa, a Transatlantic Law International Affiliated Firm. 

For further information or for any assistance please contact southafricalabor@transatlanticlaw.com

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