SA proposed minimum wage announced
20 November 2016
South African employers need to be aware that the latest minimum wage report, released on Sunday 20 November 2016 by Deputy President Cyril Ramaphosa, is an important milestone for the local HR and HCM industry.
The proposed National Minimum Wage (NMW) is R3 500 per month, amounting to R20 per hour. It was presented to the National Economic Development and Labour Council (NEDLAC) by a panel appointed to advise on the level at which the NMW should be set.
At present this is merely a legal direction and has to be agreed upon by all stakeholders, including labour, business, government and communities before it is officially ratified and becomes law.
Currently, 47% of all workers earn less than R3 500 per month. Labour and community constituencies at NEDLAC wanted the level to be set between R3 700 and R4 500, an amount the panel concluded would put employers under pressure and lead to job losses.
Why is this relevant? It redefines the employee/ employer relationship, specifically focused on unskilled labour and how roles are managed going forward.
It is important to note that if signed into law, employers will have a two-year adjustment process to implement the new minimum wage.
Irrespective of whether or not this legal development is agreed upon or returned for further deliberation and change, the fact that South Africa’s HR industry (in particular informal labour) has reached this point, bodes well for the future.
As always CRS Technologies is available to assist with any queries or questions you may have.