National minimum wage 2021

Since publication of this article, the national minimum wage has been officially announced in the Government Gazette. Follow this link to read the updated article!

Despite the weak state of the South African economy, as well as the impact of the Coronavirus (COVID-19) and negative effect of the lockdown on employers’ financial position, the National Minimum Wage Commission (NMWC) made a recommendation to the Minister of Employment and Labour to increase the current national minimum wage with effect from 01 March 2021. Until this is officially announced in the government gazette, employers must continue to comply with current legislation with regards to industry specific minimum wages.

The NMWC’s recommendation is to link the increase of the wage to the consumer price index (CPI) plus 1,5%. The CPI as of September 2020 was 3,0% and the NMWC submitted that the CPI will likely be 2,5% – 3,0% in January 2021. The increase is consequently calculated at 4,5% and entails an increase of the current minimum wage of R20.76 per hour to R21.69 per hour. Download the NMWC’s full report and recommendation here.

What about the agricultural sector?

The agricultural sector currently (2020) receives exemption to only pay 90,0% of the national minimum wage. This exemption expires and the NMWC’s recommendation is to equalise the minimum wage for farm workers with the national minimum wage of 2021. This calculates to a 16,1% increase of the current minimum wage of R18.68 per hour to R21.69 per hour. Employers in the agricultural sector should take note that domestic workers on a farm are regarded as farm workers and must receive the correct wage.

What about the domestic worker sector?

The domestic worker sector currently receives exemption to only pay 75,0% of the national minimum wage. The NMWC’s recommendation is to adjust the exemption to 88,0% of the national minimum wage of 2021. This calculates to a 22,6% increase of the current minimum wage of R15.57 per hour to R19.09 per hour. The NMWC further recommends to equalise the minimum wage for domestic workers with the national minimum wage of 2022.

The LWO is in the process of making representations to the Department of Employment and Labour and invites members and other employers to comment on the NMWC’s recommendation. Comments must be sent directly per e-mail unathi.ramabulana@labour.gov.za by 20 December 2020.


Not yet a member?

If you are an employer it just makes sense to join the LWO and get unlimited access to our legal department (specialised only in labour law) to make sure you comply with labour law and secondly, use labour law to protect your rights as the employer. All labour law advice and documentation are unlimited and free to all our members.

Join today and enjoy the peace of mind that goes with being a member.

How does membership work? What are the benefits? What does it cost? Get the answers here, or contact our offices at info@lwo.co.za | 086 110 1828 to discuss your business’s needs so we can recommend the best solution for you.

Share this on:

Share on facebook
Facebook
Share on google
Google+
Share on twitter
Twitter
Share on linkedin
LinkedIn
Ansofie van der Walt

Ansofie van der Walt

Leave a reply

Sign up for our Newsletter

Your information is safe and secure and will not be shared with any third party companies.

Attention all EMPLOYERS!

Subscribe today

to receive more information about the LWO and your

FREE Labour Law Audit Checklist

Tailored to your business needs

Your information is safe and secure and will not be shared with any third party companies.