New earnings threshold
Labour and Employment Minister Thulas Nxesi has announced a new annual earnings threshold under the Basic Conditions of Employment Act, which will have implications for South African employees.
In a Gazette published on Monday (20 February 2022) Nxesi announced that annual earnings threshold will amount to R241 110.59 per annum. This represents an increase of R 17 030.11 from the previous amount of R 224 080.48 effective 1 March 2023.
The threshold is defined as the employees regular annual remuneration before deduction of income tax, pension, medical aid and similar payments, but excluding similar payments/ contributions made by the employer in respect of the employee, This is subject to provision that subsistence and transport allowances received, achievement awards and payment in overtime worked are not regarded as remuneration of the purpose of the notice.
Employees earning more than the earnings threshold are excluded from the provisions which regulate ordinary hours of work, overtime, compressed working weeks, averaging of hours of work, meal intervals, daily and weekly rest periods, Sunday pay, pay for night work and pay for work on public holidays of the Basic of Conditions of Employment Act.
The Labour Relations Act (LRA) also extends protection to employees employed on fixed term or part time contracts of employment and employees provided to clients by labour brokers, who earn below the earnings threshold.
With reference to the Employment Equity Act (EEA), an employee earning excess of the earnings threshold, who has dispute under Chapter II of the EEA relating to unfair discrimination, is not permitted to refer the dispute to the CCM for arbitration ( unless the dispute relates to alleged unfair discrimination on the grounds of Sexual Harassment, o the parties all agree to arbitration) and is obligated to refer the dispute to the Labour Court adjudication.
NATIONAL MINIMUM WAGE
The Department of Employment and Labour has also published the new National Minimum Wage for South Africa.
The minimum wage of R23,19 per hour will increase to R25,42 per hour (an increase of approximately 9.96%) with effect of 1 March 2023. The new minimum also outlines the minimum wage for certain sectors.
Farm workers will earn a minimum in line with the rate, as will domestic workers. However, workers employed in expanded public work programmes will be entitled to a lower rate at R13.97 per hour.e
National Minimum Wage excludes allowances that are paid to enable employees to work ( such as transport and equipment), or payment in kind ( such as board or accommodation), as well as bonuses, tips or food. As such, one cannot argue that you pay employees less than the minimum wage because you contribute to their uniform or provide them with meals.
The National Minimum Wage is the floor level below which no employees should be paid. The national minimum wage applies to all workers i.e any person who works for another person and who receives or is entitled to receive any payment for that work.
Watch the live interview with Mr. Goldberg an Labour expert on eNCA .
(27 February 2023)
Thanks for sharing. Informative