The National Minimum Wage effective 1 May 2018

After months of uncertainty and speculation regarding the National Minimum Wage of R20.00 per hour to be implemented on 1 May 2018, the Department of Labour’s Deputy Director of Employment Standards Unit, Unathi Ramabulana, has announced on 7 February 2018 that the Department is busy finalising the drafting of exemption regulations.

Although the Minister of Labour may grant exemptions from the National Minimum Wage, these exemptions will be regulated by the procedure for exemption, the obligation on an employer to consult with employees or their trade unions, the criteria for evaluating exemptions, and documents to be submitted among other factors.

According to Ramabulana, the exemption application process will be subjected to thorough audits.

The National Minimum Wage Bill, amendments to the Basic Conditions of Employment Act and Labour Relations Act Bills are currently in Parliament for review.

The Department of Labour’s aim with the National Minimum Wage is to set an absolute minimum that an employer may pay an employee – no one will earn below the minimum, and this rate will be applicable to all business sectors.

The following three sectors are however, excluded from the R20.00 per hour level for now:

1. Farm/Forestry workers;
2. Domestic workers;
3. Workers on the Expanded Public Works Programme.

Learnerships will also have a separate arrangement.

It should be noted that the National Minimum Wage does not include payment of allowances (such as transport, tools, food or accommodation) payments in kind (board or lodging), tips, bonuses and gifts.

Please do not hesitate to contact us should you require any further information on the National Minimum Wage or proposed amendments to the Basic Conditions of Employment Act and the Labour Relations Act.