Min­i­mum wage could lead to

CityPress - - Business - DE­WALD VAN RENS­BURG de­wald.vrens­burg@city­press.co.za

Turn­ing the na­tional min­i­mum wage into an ac­tual law has raised new prob­lems, in­clud­ing op­por­tu­ni­ties for “all sorts of abuses” if state projects such as the Ex­panded Pub­lic Works Pro­gramme (EPWP) are ex­empted from the wage.

It ap­pears the depart­ment of labour in­tends to do ex­actly that, said Shane God­frey from the Univer­sity of Cape Town’s Labour and En­ter­prise Pol­icy Re­search Group.

The na­tional min­i­mum wage was de­signed by an ex­pert panel ap­pointed by Deputy Pres­i­dent Cyril Ramaphosa and was then turned into an agree­ment at the Na­tional Eco­nomic De­vel­op­ment and Labour Coun­cil.

God­frey said both pro­cesses left too much un­de­ter­mined.

The depart­ment is hav­ing a bill drafted in the hopes of reach­ing a dead­line for im­ple­men­ta­tion next year.

“A whole set of pol­icy decisions have sim­ply been del­e­gated to the depart­ment due to a lack of de­tail in the agree­ment,” he said.

Of­fi­cially, it has not been de­cided whether the EPWP would be ex­empt from the na­tional min­i­mum wage, but the depart­ment has al­ready as­serted that this was the case in pub­lic road­shows, said God­frey.

“The prob­lem is that the EPWP wage is at R11 now. Rais­ing it to the na­tional min­i­mum wage would in­volve a con­sid­er­able amount.”

The min­i­mum wage is meant to come into ef­fect next year at an ini­tial rate of R20 an hour.

If wages un­der the EPWP are not at least moved nearer to this level, the in­cen­tive to con­vert forms of work into EPWP projects be­comes stronger.

God­frey said that mu­nic­i­pal unions in par­tic­u­lar had com­plained that work at lo­cal gov­ern­ment level was get­ting shifted into the EPWP to lower labour costs.

At least lift­ing the EPWP wage to a less ex­treme dis­count to the R20 na­tional min­i­mum wage, as will be the case with do­mes­tic work and farm­ing, could help, said God­frey.

God­frey and his col­leagues have been doc­u­ment­ing all the prob­lems that could crop up if the na­tional min­i­mum wage is slot­ted into the ex­ist­ing mesh of labour laws.

At a work­shop on their find­ings this week, God­frey ad­vo­cated all the state-sub­sidised forms of em­ploy­ment to be part of the na­tional min­i­mum wage.

This in­cludes the EPWP, learn­er­ships and jobs that are be­ing sub­sidised by the di­vi­sive youth wage sub­sidy.

The learn­er­ship sys­tem has been a bone of con­tention in the long ne­go­ti­a­tions around a min­i­mum wage, and ap­ply­ing it to this sys­tem could have con­se­quences for the funds col­lected by the 1% skills de­vel­op­ment levy.

“Most of them would earn be­low the minium wage, so

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