For The People

National Minimum Wage Bill Passed

Parliament passed the National Minimum Wage Bill on Tuesday, which is one of the programmes that President Cyril Ramaphosa facilitated while still being the Deputy President. The Bill will be referred to the NCOP, before being assented to by the President , after which it will become law. The National Minimum Wage (NMW) of R3500.00 per month is not regarded as a living wage, but it does set the minimum wage level. No employer will be allowed to pay workers covered by the wage lower than the set minimum of R3500.00 per month or R20.00 per hour.

It is expected that the NMW will cover “ 75% of agricultural workers who earn below R2,000 and about 90% of domestic workers who earn below R3,120 per month “ according to the ANC’s Chief Whip’s office. “I am very pleased that the journey towards addressing the plight of the lowest paid workers in the labour market has reached this milestone.”- the Minister of Labour, Mildred Oliphant told the National Assembly on the occasion of presenting the Bill for adoption..

Ample support for the Bill

Matthew Parks, COSATU’s Parliamentary Coordinator was excited that a number of labour bills were adopted, which included the National Minimum Wage, Basic Conditions of Employment and Labour Relations Amendment Bills. “This is an historic victory for millions of workers” Parks said. He further mentioned that the minimum wage was key a demand of the Freedom Charter since 1955. According to Parks no country in the world has legislated a living wage and technically it cannot be legislated. COSATU is of the view that 6.4 million workers’ wages will immediately rise if the Bill becomes law, but still believes that a living wage must be campaigned for by trade unions, government and business.

Vulnerable workers such as farm workers, domestics, workers in the retail sector, hotels, restaurants, transport, cleaning , etc. will benefit from the NMW. COSATU’s Parks is of the view that the NMW will enhance spending in the local economy which will give economic growth a shot in the arm. Similar legislation have been developed and implemented formerly in countries like the USA, Brazil and Germany. It will be a major tool in the fight against poverty, inequality and unemployment. Dennis George, FEDUSA’s General Secretary also gave the Bill the thumbs-up on behalf of his organisation. He recently told the media that “People are making allegations without any substantial data. Our research data shows that 4.5 million people in South Africa earn less that R3500 a month.” FEDUSA is also in agreement that NMW is not a living wage , but “it is a start and many people are going to benefit” George said.

Not all in agreement

The Democratic Alliance (DA) did not support the Bill as expected, due to the recent federal congress resolution that employees should be allowed to opt out of the national minimum wage agreement i.e. they should be able to accept lesser salaries if they so wish. According to DA Member of Parliament, Michael Bagraim, the party opposed the Bill because it will cause joblosses . “Clearly this proposed wage will destroy jobs for the marginal workers and most certainly prevent their entrance into the economy,” was Bagraim’s response in parliament. Those opposed to the bill do so for different reasons. South African Federation of Trade Unions (SAFTU) has been vehemently opposing the NMW and other labour law changes.

SAFTU General Secretary, Zwelinzima Vavi referred to the current amendments as “Margaret Thatcher and Ronald Reagan” style labour law overhauls. According to Vavi, Deloitte recently reported that the average salary of a CEO of the Top 100 companies is R17.97million per annum or R69 000 a day which amounts to R8 625 an hour. SAFTU believes that the proposed amendments “ will give employers enough legal reasons to stop any strike at all, even just by claiming that it will adversely affect their business, which is precisely what a strike is intended to do. It will turn workers into virtual slaves. It will unleash a war on workers’ rights, liberty and living standards.” Another organisation opposed to the labour law overhauls is the University of Witwatersrand’s (WITS), National Minimum Wage Research Initiative. The research initiative has condemned the labour department for ignoring the serious concerns raised by social partners.

Dr Gilad Isaacs, the coordinator of the research initiative, said that an agreement was reached at NEDLAC level that the lower wage levels of farm workers and domestic workers should fall away after two years. According to Dr. Isaacs this twoyear deadline was not reflected in the NMW Bill despite the NEDLAC agreement. This means that domestic workers, farm workers and EPWP workers’ wages may not reach the R20.00 per hour minimum very soon. Despite opposing some aspects of the Bill, the research initiative has also conceded that when regulating wages upwardly it leads to growth in the economy and higher labour productivity.

What is the real National Minimum Wage

Solomon Star can reveal that in its current form the Bill differentiates between certain workers and the R20.00 per hour minimum is not the same for all workers across the board. The Bill that was adopted clearly states that despite the minimum wage of R20.00 per hour – farm workers are entitled to a minimum wage of R18 per hour; domestic workers are entitled to a minimum wage of R15 per hour; workers employed on an expanded public works programme are entitled to a minimum wage of R11 per hour. Workers who are on learnerships will also be entitled to certain minimum allowances depending on the NQF level of the learnership and the number of credits that the learner has achieved, e.g. from R300.00 to R 1755.00 per week for NQF-1 and NQF-8 respectively.

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