‘Pay the right wages’
NO DIGNITY: NEW NATIONAL MINIMUM WAGE ‘NOT ENOUGH’ FOR A FAMILY Decent increase but is hardly enough to survive – expert.
The national minimum wage increased by 8.5% from R25.42 to R27.58 per ordinary hour worked on 1 March 2024. But is it enough in a country where the cost of living is keeping nutritious food off the tables of low-income consumers?
Prof Ines Meyer of the University of Cape Town says: “It is definitely a step in the right direction but still does not allow workers to live a dignified existence.
“Although 8.5% sounds like a decent increase, you must remember that it translates to just R2 per hour.”
Meyer also chairs the Living Wage South Africa Network and is a staunch promoter of the Living Wage concept that’s gaining popularity in many countries.
She recently returned from India where she attended meetings with living wage proponents from around the globe.
Among them were members of the International Labour Organisation (ILO), whose governing body has just endorsed living wages as central to economic and social development.
It means that an ILO employer, government and worker representatives agree that living wages must be part of labour standards in ILO member countries. South Africa is a member of the ILO.
However, there is a big difference between a living wage and a minimum wage. Meyer says a living wage is remuneration that’s sufficient for someone to provide their family with the basic necessities, allows them to save and to cover unexpected emergencies.
The required amount should be based on evidence.
While legislated minimum wages compel companies to pay workers not less than the prescribed amount, they seldom satisfy Living Wage criteria.
Meyer says: “Someone working at minimum wage for nine hours a day over the typical 22 working days per month earns less than R5 500 per month, which is hardly enough to survive and affords little chance of a decent, healthy or happy lifestyle.”
She adds that a minimum wage keeps people in poverty and employers must be aware that they prevent people from living a dignified life if they pay it.
Over the past decade, corporate sustainability reporting has been gaining momentum with a core focus on environmental, social and governance (ESG) concerns. This allows organisations to be transparent about their impact on people, the planet and prosperity in their operational ecosystem and their integrity as a going concern.
Meyer says ESG frameworks assume that prosperity not only refers to the profit a company makes but also to how it improves or degrades the economic conditions of the community where it operates.
“While some have decried the latest minimum wage increase as too costly and likely to raise unemployment, paying employees humanely attracts investment.
“A company cannot be serious about good ESG while its workers remain living in poverty although they are employed.”
She says unlike the legally enforced minimum wage, a living wage is meant to be adopted voluntarily by employers as an act of human decency.
“It demonstrates that the employer is genuinely concerned about their workers’ constitutional right to dignity and not just checking a compliance box.
“Pay is not just an amount, it also communicates to the employee how they are seen and valued as human beings by their employer,” Meyer says.
She adds that this demands a mindset shift from profits at all costs to profits resulting from recognising workers as fellow human beings whose personal economic enrichment contributes to the national economy’s sustainability.