Employers who fail to comply with the relevant legislation risk being caught up in unnecessary legal action and disputes as some employees and unions might see this as an opportunity to exploit the situation.
The National Minimum Wage Act (NMWA), currently the National Minimum Wage Bill (the bill), recently created much confusion and uncertainty. The effective date had been 1 May 2018 but was subsequently postponed on Monday 26th March until further notice by our Labour Minister Mildred Oliphant.
The purpose of this article is to provide you with a clear, objective and unbiased legal framework for some of the pertinent elements of the NMWA.
The main objective of NMWA is to provide for a national minimum wage to advance economic development and social justice by improving the wages of the lowest paid workers, protecting workers from unreasonably low wages, promoting collective bargaining and supporting economic policy.
A wage for purposes of the NMWA is the amount paid in money for ordinary hours worked and is calculated as follows:
If an employee is paid on a basis other than the number of hours worked, he/she may not be paid less than the NMW for ordinary hours worked.
The NMW is R20,00 for each ordinary hour worked; however, the following categories of employees have been excluded:
In terms of Section 18 of the Bill, an Employer or a registered Employers’ Organisation acting on behalf of its members may apply for an exemption from paying the NMW. On 7 February 2018, the Department of Labour indicated that it was in the process of finalising the draft exemption regulations.
The regulations will contain:
Recent amendments to Sections 69 and 73 of the Basic Conditions of Employment Act deal with enforcement of the NMW. The Director-General of the Department of Labour has been empowered to refer non-compliant employers to the CCMA directly, as opposed to the Labour Court. The CCMA may, as per the nature of the referral, render an arbitration award which can be made an Order of the Labour Court in respect of non-compliance with the NMWA.
SERR Synergy guides and assists businesses in a practical and supportive way with regard to the required processes and procedures to ensure labour legislation compliance and to minimise the risk to which the business is exposed when employing staff. Our experienced labour relations consultants deal comprehensively on the client’s behalf with the relevant labour legislation and most common pitfalls that businesses encounter.
About the Author: Jared Francis joined SERR Synergy in October 2016, and currently holds the title of KZN Labour Manager. He is an admitted attorney who has practised in KZN and Gauteng. He holds an LLB degree, a Post-Graduate Diploma in Industrial Relations and a Post-Graduate Certificate in Forensic Investigation from the University of KwaZulu-Natal. He also holds Post-Graduate Certificates in Advanced Labour Law, Corporate Law, Advanced Human Resource Management and Health and Safety from UNISA and has more than 10 years’ experience in the legal and industrial relations fields respectively.
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