Proposed Increase of the National Minimum Wage

Proposed Increase of the National Minimum Wage

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The National Minimum Wage Commission Report 2023 has been published in the Government Gazette on 6 December 2023, to present the Commission’s information and recommendations on the annual review of the national minimum wage.

 

In 2021, the Commission recommended increasing the national minimum wage from R20,76 to R21,69 per hour. The 2022 national minimum wage was revised from R21,69 to R23,19 per hour. In 2023, the minimum wage was adjusted to R25.42 per hour.

 

Increasing the national minimum wage is critical, impacting both employees and employers. The following key considerations should inform the level of the increase in the national minimum wage for 2024:

 

  • Wage levels and collective bargaining outcomes.
  • Gross Domestic Product.
  • The ability of employers to carry on their business successfully.
  • The likely effect of the increase on employment and the creation of employment.

 

The majority of the commissioners recommended an increase of CPI +3%. The CPI is a measure of the change in prices as paid by consumers for goods and services over time. In South Africa, the latest consumer price inflation, as published by Statistics South Africa, was 5.9% in October 2023, up from 5.4% in September 2023.

 

The three proposals tabled in the report are as follows:

  • Eight of the 12 commissioners propose that the national minimum wage increase by CPI plus 3%.
  • The recommendation by the Business Constituency is CPI only.
  • The recommendation by an independent expert is CPI plus 0.75%.

 

The Commission invited written representations in accordance with section 6(2) of the NMWA and received varied comments from trade unions, interested parties, employees’ representatives, and employers’ representatives. The period for public comment is now open. Comments must be made by 8 January 2024. They must be sent to nmwreview@labour.gov.za or by post.

 

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