On March 5, the Department of Employment of Labor (DEL) published a government gazette providing for an increase of the earnings threshold in terms of Section 6(3) the Basic Conditions of Employment Act 75 of 1997 (BCEA). This represents a 5.5 percent increase from the previous threshold of R241,110.59 per annum to R254,371.67 per annum (being R21,197.63 per month). This increase took effect April 1.
For those employers who pay employees at or around the earnings threshold, it is important for such employers to review such employees’ remuneration and to access whether certain of their employees will now fall below the new earnings threshold.
Employees who earn below the earnings threshold are entitled to additional basic conditions of employment such as the payment of overtime, limited working and overtime hours, daily and weekly rest time and additional pay for work on Saturdays, Sundays and public holidays.
In addition to the above, there is also a significant consequence in terms of the Labor Relations Act 66 of 1995 with respect to employees who earn below the earnings threshold and who are employed on a fixed term or part-time basis and with respect to those who are employed by temporary employment service providers, also known as labor brokers.
In addition to the increase in the earnings threshold, on Feb. 2, the DEL implemented an increase in the national minimum wage of approximately 8.5 percent, from R25.42 to R27.58. This increase was effective from March 1.
This increase is also applicable to farm workers and domestic workers. Workers employed on an expanded public works program, have had their national minimum wage increased from R13.97 to R15.16 per hour and workers engaged through learnerships in terms of the Skills Development Act 97 of 1998, have had their allowances increased between R415.07 to R2 421.13 depending on the learners’ National Qualifications Framework level and the learners’ credits.
Businesses that employ workers at the national minimum wage should review their employees’ wages to ensure compliance and, to the extent compliance isn’t feasible, to urgently apply for an exemption.
Lucinda Hinxman is an attorney with CMS South Africa in Johannesburg. Pooja Pundit is an associate designate with CMS South Africa in Johannesburg. © 2024 CMS Africa. All rights reserved. Reposted with permission of Lexology.
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