National minimum wage bumped up by R2.23 an hour

The national minimum wage will on Wednesday rise by almost 10%, going up by R2.23 an hour.

Minister of Employment and Labour Thulas Nxesi published the minimum wage adjustment for 2023/24 in the government gazette on 21 February 2023.

The rate jumps from R23.19 per hour to R25.42 per hour – an increase of approximately 9.6%. This comes after the new National Minimum Wage Bill came into effect.

Workers employed on Expanded Public Works will continue to earn R13.97 per hour.

Minimum rate earners include domestic workers and farm workers.

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Working a full-time job on minimum wage will see an employee paid R4 473.92 a month, up from R4 081.44.

All additional payments to facilitate an employee’s work, such as transport and equipment allowances, as well as non-cash benefits like accommodation and board, are not included in the national minimum wage. Bonuses, tips and food also don’t count towards it.

The Department of Labour said employers cannot attempt to pay employees less than the minimum wage if they are given uniforms or meals.

According to LWO Employees Organisation, the criteria generally used to determine the proposed increase is the consumer price index (CPI) plus 1.0%. The CPI was 7.2% in December 2022, and the minimum wage increase was thus calculated at approximately 8.2%.

SA businesses feel the brunt

Already heavily burdened with load shedding woes, with additional costs to secure alternative energy sources, employers – especially those who are owners of SMMEs – are buckling under the pressure of mounting financial expenses.

The LWO states that if an employer fails to comply with the national minimum wage, they can be fined. Further non-compliance will also lead to more considerable penalties.

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But according to the Department of Labour, the National Minimum Wage Act does allow for exceptions for businesses that are struggling. These businesses need to lodge an application through the national minimum wage system online.

The business will be required to provide a statement of its financial performance over the last three years as well as a statement of its financial position.