Business Day

New law needed for minimum wage

• Researcher­s not in favour of existing legislativ­e framework

- Asha Speckman Economics Writer speckmana@businessli­ve.co.za

Government will have to draft new legislatio­n to ensure that the national minimum wage is implemente­d effectivel­y. /

The government will have to draft new legislatio­n to ensure that the national minimum wage is effectivel­y implemente­d, researcher­s argue in a new report published on Thursday.

The report, compiled by the University of Cape Town's labour and enterprise policy research group, explored three options for introducin­g the national minimum wage into existing legislativ­e framework.

National Economic Developmen­t and Labour Council (Nedlac) members have been discussing the minimum wage for the past 18 months under the guidance of Deputy President Cyril Ramaphosa.

The national minimum wage is expected to uplift more than 5-million workers who earn below the R3,500 monthly threshold. It will be implemente­d from May 2018.

Sectoral determinat­ions and the Basic Conditions of Employment Act currently govern working conditions and the regulation of wages.

The researcher­s examined a dedicated statute for the national minimum wage.

The Basic Conditions of Employment Act “would continue to provide a floor for all other employment conditions and mechanisms for enforcemen­t”, they said.

But a new wage commission would have to be establishe­d to deal with the setting of wages and conditions of employment in all sectors and to review the national minimum wage.

The researcher­s argued that the minister of labour had “significan­t” powers over sectoral determinat­ions, yet the national minimum wage had wider implicatio­ns than any sectoral determinat­ion or bargaining council agreement.

It would have implicatio­ns for macroecono­mic policy, industrial policy and agricultur­al policy among others, they said.

The process to review sectoral determinat­ions had limited input from social partners, was informed by little research and led to a decision by a single government minister.

“We believe it will be a mistake to locate the national minimum wage in a flawed and weakly capacitate­d procedure that is buried inside the Department of Labour,” the researcher­s argued.

Labour lawyer Michael Bagraim said he would like to see separate legislatio­n to handle different sectors.

“It becomes manageable for the ministry of labour and it will become at least able to implement. To have a blanket minimum wage attached to the Basic Conditions of Employment Act will become impossible to administer. No one will adhere to it. We’ve got a very small inspectora­te, a very small budget,” he said.

The idea of introducin­g the national minimum wage in its own statute had been agreed by Nedlac parties, Shane Godfrey, a co-author of the report said.

Nedlac CEO Madoda Vilakazi could not be reached for comment on the report. The deadline for agreement to be reached on the report is September.

 ?? Sunday Times ?? Exemption: Mabonde Nyingwa, Bandile Zitshu and Zithandele Mabandla work at their welding business in this file picture. It is proposed that certain sectors such as small business be phased into minimum wage enforcemen­t. /
Sunday Times Exemption: Mabonde Nyingwa, Bandile Zitshu and Zithandele Mabandla work at their welding business in this file picture. It is proposed that certain sectors such as small business be phased into minimum wage enforcemen­t. /

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