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Minimum Wage in South Africa – Frequently Asked Questions

Is there a separate legislation relating to minimum wages in South Africa?

There is no national (statutory) Minimum Wage. However, the Basic Conditions of Employment Act (BCEA) permits the Minister of Labour to set minimum terms and conditions of employment, including Minimum Wages. They are in place in areas of economic activity where labour has been deemed vulnerable. These are in nine sectors: 1) Domestic work sector 2) Contract cleaning 3) Private security sector 4) Wholesale and retail 5) Farm worker sector 6) Forestry sector 7) Taxi sector 8) Learnerships 9) Children in the performance of advertising, artistic and cultural activities. If a sector or area is not considered vulnerable, there are no minimum wages, regardless of the fact that some employees in that sector or area may be paid very low wages. Do one or more minimum wages exist that is/are determined by law? -- Yes, more than one minimum wages exist which are determined by law.

At what level are minimum wages determined?

Minimum wages are determined at national, regional, sectoral and occupational/skill level.

On what basis is minimum wage calculated?

Minimum wages is calculated at daily, hourly, weekly and monthly basis.

Are governmental bodies, employer and/or trade union representatives involved in minimum wages setting?

Department of Labour, Employer organisations at company and plant level, All registered trade unions and trade union confederations. Other than that Minimum Wages are included in centralised and decentralised bargaining at company (single employer) and plant level.

How are upratings (adjustments) of minimum wages decided upon?

In the case of sectors which fall under the Department of Labour minimum wages are adjusted unilaterally by the government. In the case of sectors which are covered by a collective agreement concluded at a Bargaining Council or through centralised or decentralised bargaining at company or plant level, it is adjusted after consultation of employer and trade unions representatives.

How frequently is the fixed component of minimum wage updated?

Minimum Wage is a fixed component which is adjusted annually. Upratings are mostly calculated three to four years in advance, and are normally fixed for one year.

What is/are the yardstick/s on which minimum wage upratings are based?

Upratings are usually calculated based on the Minimum Wage for the sector, + CPIX/CPI + 1%

What is the national poverty line? (In national currency)

The national poverty line is R515.00 How often is poverty line updated? -- The national poverty line was created in 2008 and has not been adjusted since then.

When was poverty line last updated? (YYYY/MM)

The national poverty line was created in 2008 and has not been adjusted since then.

What is the percentage of minimum wage relative to the current poverty line?

The (lowest) average Minimum Wage is around R1500 per month. The poverty line is R515 per month. Therefore the percentage of Minimum Wage is 200% more.

What is the incidence of minimum wages(s) in the national labour force (wage earners only)?

There is no comprehensive data to calculate.

How is minimum wages compliance regulated?

The Department of Labour monitors Minimum Wages that fall under the departmental regulations. Inspectors from the Department of Labour make investigations about the implementation of labour laws, rules and regulations. There are 800 inspectors in the country. Trade Unions monitor Minimum wages that are regulated through Bargaining Councils. Employers (and employees) and trade unions monitor Minimum Wages that are included in centralised and decentralised bargaining at company (single employer) and plant level.

Which legal sanctions can be applied in compliance is lacking?

If a complaint is lodged with the Department if Labour concerning Minimum Wages and an employer is found to be guilty of paying below the stated Minimum Wage, the employer can be fined. If a complaint is lodged with the Department if Labour concerning Minimum Wages and an employer is found to be guilty of paying below the stated Minimum Wage, the employer can come to an arrangement with the employee to pay arrears.

Are sanctions often being applied?

Although the Minimum Wage system is in place, the reality is that South Africa’s numerous prescribed Minimum Wages are ignored 45% of the time, an investigation commissioned by the Department of Labour has found. Although there are 800 inspectors charged with examining labour practice and Minimum Wages, there is still a very incidence of non-compliance, particularly in the domestic work and agriculture sectors.

Are employer and/or trade union representatives involved in compliance procedures?

Employers and trade union representatives are involved in compliance procedures through the Department of Labour. All complaints are registered with the department.

To whom/Where can individuals complain, if they think they are earning less than minimum wages?

Individuals can complain to the Department of Labour if they think they are earning less than the Minimum Wage. Trade Union members can also complain to their union representatives. Individuals can complain to the Department of Labour if they think they are earning less than the Minimum Wage. Trade Union members can also complain to their union representatives.