As of recent, the minimum wage has been the “hot” topic trending in the news. It is of common cause the Bargaining councils provide the minimum wages for employees and employers falling within the scope of the council, however to date the wages for employee’s belonging to the Basic Conditions of Employment Act 75 of 1997 and no Bargaining Council have remained the decision of the employer.
One can say that giving the employer the discretion to determine the basic wage for employees could allow for much controversy on the fairness and reasonableness of the pay.
On the 29th day of May 2018, the National Assembly passed the “historic” National Minimum Wage bill, saying that a minimum wage of twenty rand (R20.00) per hour or R 3 500 per month is to be set across the board. The South African Labour Minister, Oliphant, is in full support of the minimum wage to be set at twenty rand per hour as he stated “this is the start to addressing the plight of the lowest paid workers.”
Concerns regarding the implementation of the minimum wage have been raised in that this could lead to possible job losses as employers may not be able to afford the minimum wage. Furthermore, this could potentially exclude independent contractors.
Many positive purposes of the set minimum wage has been highlighted such as:
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improving the wages of lowest paid workers
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protecting workers from unreasonably low wages
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preserving the value of the national minimum wage
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supporting economic policy
What does this mean for the employer?
Negative-Setting the minimum wage at twenty rand per hour or R 3 500 per month may pose strain on employers who are forced to comply with this as wages across the board will need to be increased, placing financial strain on the Company. Employers who do not comply will face legal implications.
Positive- This could lead to a decrease of wage negotiations and referrals to the relative resolution centre as the minimum wage will be regulated.
Employers are to take note that this is a pure hourly wage, and can not include any other benefits or remuneration.
Exemptions:
An employer or an employers’ organization registered in terms of section 96 of the Labour Relations Act, thus meaning the Employers Organization or Trade Union is registered, (or any other law), acting on behalf of its members, may, in the prescribed form and manner, apply for an exemption from paying the National Minimum Wage.
Conclusion:
The minimum wage has not yet been gazetted and only passed by the National assembly and is still be approved by the National Council of Provinces, indicating that the implementation is well on its way. Employers are advised to embark on the necessary procedures and preparation to ensure a smooth transition can occur when the bill is passed and the minimum wage has been set into legislation.
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