Minimum wage step to equality

Firm foundation for SA to move in right direction – Ramaphosa

THE NATIONAL minimum wage of R20 per hour, set to be implemented on May 1 next year, was not a living wage, but a step towards income equality in South Africa, Deputy President Cyril Ramaphosa said yesterday.

“This is a firm foundation of moving our country towards a living wage.

“It is a start. These agreements are the outcomes of nearly two years of deliberations,” Ramaphosa said while addressing journalists in Parliament on a set of agreements agreed to by the social partners at the Economic Development and Labour Council (Nedlac).

Ramaphosa said the minimum wage would translate into a monthly salary of R3 500 for those working a 40-hour week, and R3 900 for those working a 45-hour week.

The deputy president said the agreement, which had been signed by all Nedlac social partners – save Cosatu, which first has to report back to its central executive committee before it signs on the dotted line – was a balancing act.

“We were seeking to balance the issue of increasing the wages of up to 6.6 millon workers (earning below R3 500 per month)… his wage could easily have been R20 000 (or) R10 000.

“In doing so, there would have been a negative impact where many workers would have lost their jobs through the introduction of an overly high minium wage,” said Ramaphosa.

Employers of farmworkers and domestic workers will have a lead-in period of two years to bring the salaries in line with the R20 an hour wage.

Ramaphosa said businesses which could not afford the minimum wage would have a chance to plead their cases.

“What we are saying is businesses should not opt for closure, reduction of hours, retrenching workers… we are saying assistance will be put in place for them to come forward and argue their case.”

The deputy president said the minimum wage was not a gamble, and it was hoped that instead of job losses the increase in wages would create a greater demand for goods and services.

“We had to start somewhere and, if you like, create a balance and even play it safe,” he said, adding he was expecting criticism.

“It’s better to be criticised for doing something, than not be criticised for doing nothing.”

Ramaphosa said a commission would be set up to review the national minimum wage on an annual basis.

From now until May 1, 2018, the process of drafting and adopting the National Minimum Wage Act, as well as amendments to relevant labour legislation, would be undertaken. – ANA