SA banks and insurers have bucked the trend and revealed their minimum pay — and according to the data it is much higher than the legislated minimum wage.
Nedbank last week said it had increased its minimum wage by 6.7% to R240,000 a year with effect from this month.
Rival Absa hiked its minimum pay 8.7% to R250,000 — also with effect from April. The country’s largest bank by assets, Standard Bank, pays a minimum salary of R258,390 for its unionised employees in SA.
FirstRand, owner of FNB, RMB and WesBank, among other brands, has been paying a minimum guaranteed package for banking roles of R215,000 a year from August 1 2024.
The group also pays a minimum of R185,000 a year for nonbanking roles. Both amounts exclude performance-related variable pay, medical aid subsidy and school fee assistance for eligible employees.
Investec’s last annual report shows the group’s minimum salary for employees in SA is R250,000 a year.
The Anglo-South African lender went further and revealed the pay gap between the top 5% best-paid SA employees and the bottom 5%.
The annual report shows that average single-figure total remuneration of the top 5% SA-based employees was R10.1m a year in the 2024 financial year, while the bottom 5% pocketed just R297,000.
Investec is expected to release its annual report in the coming weeks that might reveal an increase in its minimum pay for SA employees.
Many companies have held back publishing their pay gap analysis until the amendments to the Companies Act are promulgated.
According to the amendments, public and state-owned companies will be required to develop a detailed remuneration policy and report.
This must include data on the earnings of directors and officers, the highest and lowest-paid employees, and the average and median remuneration for all employees. The aim is to highlight pay disparities within companies and to enhance transparency.
SA insurance firms, particularly those listed on the JSE, have also begun revealing their minimum pay, with Old Mutual paying R16,000 a month, while Santam pays R15,000 a month, according to its 2023 annual report.
The minimum guaranteed pay paid by banks and insurers is significantly above the legislated minimum wage in SA of R28,79 an hour, which translates to just more than R60,000 a year.
Noncompliance with SA’s national minimum wage regime, first introduced seven years ago, has increased, with the policy running the risk of being merely an “aspirational” tool to level the playing field, according to a study by University of Cape Town academics.
This is as some employers respond to the national minimum wage by reducing workers’ working hours.
The National Employers Association of SA (Neasa) has decried minimum wage legislation, arguing small businesses often can’t afford the minimum wage set by the National Minimum Wage Commission, housed under the department of employment & labour.
Shareholder activist group Just Share said it was unfortunate the government did not heed comments from civil society that this disclosure should also include the job descriptions of those whose salaries are considered the lowest, when amending the Companies Act.
“This is important because it is not possible to establish, from most corporate wage disclosures, what roles these minimum disclosures apply to, and how many of the companies’ workers are in fact outsourced workers earning significantly less than the disclosed amounts,” said Tracey Davies, executive director of Just Share.
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