New minimum wage announced for South Africa

8 February 2022

Labour minister Thulas Nxesi has published the new minimum wage for South Africa.

In a gazette published on Monday evening (7 February), the minister said that the national minimum wage is now R23.19 for each ordinary hour worked. This change will take effect from 1 March 2022.

This represents an increase of 6.9% from the minimum wage set in 2021.

Unlike in previous years, no specific worker groups have been provided exceptions, with the minimum wages for domestic workers and farmworkers now also set at R23.19 for each ordinary hour worked as part of a planned equalisation push. This represents a 21.5% increase for domestic workers.

The adjustments follow recent proposals published by the National Minimum Wage (NMW) Commission which recommend that domestic worker salaries be increased to 100% of the National Minimum Wage.

Under the Act, the minimum wage for domestic workers was initially set at 75% of the National Minimum Wage in 2020. The Commission proposed increasing it to 88% of the national minimum wage in 2021 and 100% in 2022.

Workers employed as part of the expanded public works programme are entitled to R12.75 per hour.

The National Minimum Wage Act was first proclaimed in 2018, setting a historic precedent in the protection of low-earning (vulnerable) workers in South Africa and providing a platform for reducing inequality and huge disparities in income in the national labour market.

The national minimum wage was first implemented on 1 January 2019 at a level of R20 per hour. On 1 March 2021, the minimum wage base rate was adjusted to R21.69 per hour.

In terms of the law, it is an unfair labour practice for an employer to unilaterally alter hours of work or other conditions of employment in implementing the national minimum wage.

The national minimum wage is the amount payable for the ordinary hours of work and does not include payment of allowances (such as transport, tools, food or accommodation) payments in kind (board or lodging), tips, bonuses and gifts.

The National Minimum Wage Commission considers the following factors when determining the annual adjustment: inflation, the cost of living, and the need to maintain the value of the minimum wage; gross domestic product; wage levels and collective bargaining outcomes; productivity; employers’ ability to carry on their businesses successfully; the operation of small, medium, or micro- enterprises and new enterprises; and the likely impact of the recommendation adjustment on employment or the creation of employment.

Source: Businesstech at https://businesstech.co.za/news/finance/556460/new-minimum-wage-announced-for-south-africa/?fbclid=IwAR2iS8-1roWnr6yw6ikuzY3xL4VxAIOS3HoIBwdVXbWScA7V63h3cvRuZic