On Tuesday, Employment and Labour Minister Thulas Nxesi announced that from March, the National Minimum Wage (NMW) will increase to R21,69.
The National Minimum Wage (NMW) will increase from R20, 76 to R21,69 per ordinary hour of work.
“In considering the annual adjustment, the Commission considers the following factors: inflation, the cost of living, and the need to retain the value of the minimum wage; gross domestic product; wage levels and collective bargaining outcomes; productivity; the ability of employers to carry on their businesses successfully; the operation of small, medium or micro-enterprises and new enterprises; likely impact of the recommendation adjustment on employment or the creation of employment,” the Minister says.
From 2020 to 2021, the NMW for farmworkers has increased from R18,68 per hour to be aligned with the NMW at R21,69. The hourly rate for domestic workers has increased from R15, 57 to R19,09 per hour. Minister Nxesi says that the rate for domestic workers could be aligned with the NMW in the next review.
Workers on expanded public works programme will now receive a minimum wage of R11, 93 as opposed to R11, 42 in 2020. Allowance for learnership agreements will be determined on the National Qualifications Framework level.
“In line with the Basic Conditions of Employment Act (BCEA), the increase in the NMW will mean that wages prescribed in the sectoral determinations that were higher than the NMW at its promulgation, must be increased proportionally to the adjustment of the national minimum wage. Therefore, the Contract Cleaning; and Wholesale and Retail Sector will also have their wages upwardly adjusted by 4,5 percent,” the Department says.
Agri SA says that the decision to immediately align the rate for farmworkers with the NMW is unsustainable to the agricultural sector.
The organisation feels that the commissioners did not take into account the extent of which the sector was affected by the pandemic, the challenges faced by farmers in drought-stricken provinces and the grave concerns regarding the Land Bank.
“The double-digit increase will almost certainly compromise the role of the agricultural sector in contributing to social stability in our country, Agri SA warns. If farmers cannot produce food affordably and employ agricultural workers on a large scale, this will result in a food crisis and large-scale social upheaval as food insecurity and unemployment start to take root.
“The government will need to decide whether it is serious about addressing unemployment. The Covid-19 pandemic continuous to wreak havoc and unemployment is on the increase. To approve of a 16% increase, therefore, does not make sense,” Agri SA says.
Employers will not be allowed to change the hours of work or other conditions of employment after the NMW is implemented and may be reported for illegal and unfair labour practice.