28/02/2022
CHANGES IN THE MINIMUM WAGE AND EARNINGS THRESHOLD 2022
On 7 February, the Department of Employment and Labour has published increases in the national minimum wage, as well as the earnings threshold - both effective from 1 March 2022.
The new Minimum Wage will now be R23,19 per hour for most categories of workers, including farm workers and domestic workers. There are some exceptions where specific wages have been published for specific categories / sectors, such as Contract Cleaning, Wholesale and Retail, and Learnerships Allowances.
The Earnings Threshold (or as some people refer to it, the 'overtime limit') will increase to R224,080.48 p/a, up from R211,596.30 p/a last year.
The earnings threshold plays a role in various labour statutes, where it presents a cut-off point for greater protection of lower earners. Typically, employees above this threshold do for example not have statutory entitlements to overtime pay, specified daily/weekly rest periods, etc.; and employees below this threshold may refer certain types of disputes (e.g. unfair discrimination) to the CCMA, where higher earners have to take the case to the Labour Court.
It is therefore an important change to take note of - and it might well be that some of your employees who earn around this figure and who have thus far been exempt from overtime payment, will now be entitled to it.
For purposes of determining whether an employee earns in excess of the earnings threshold, “earnings” means an employee’s regular annual remuneration before the deduction of tax, pension and medical aid contributions and similar payments, but excludes similar contributions made by the employer in respect of the employee.
