The 3.8% national minimum wage increase that was gazetted by the government on Monday is an affront to workers, unions said on Wednesday.
The increase, which comes into effect on March 1, is in line with the recommendations of the National Minimum Wage Commission and has elicited an angry reaction from organised labour.
The 3.8% translates to an increase of 76c per hour in 2020, employment & labour minister Thulas Nxesi said in the notice.
Labour formations argued it is much less than the prevailing 4.5% inflation, and dismissed the notion advanced by employers that it will lead to job losses.
In January 2019, the R20 per hour national minimum wage came into effect, amid much pushback from employers who said they could not afford it. They argued then that it would lead to huge jobs cuts.
Labour relations chief director at the department of employment & labour, Thembinkosi Mkhaliphi, said they are working with Stats SA to determine what effect the minimum wage has had on jobs.
The 3.8% increase will take the national minimum wage to R20.76 an hour, which translates to an increase of R6.08 per day, and R121.60 per month.
The programme director of research group Pietermaritzburg Economic Justice & Dignity Mervyn Abrahams said according to their calculations the workers would need a 30.7% increase to be able to afford transport, electricity and food. This would entail increasing the national minimum wage hourly rate to R26.14.
Outraged by increase
Abrahams said because consumer demand has waned, companies, which he said were already in distress, “will supply less because they are not going to produce what they cannot sell”.
The Federation of Unions of SA (Fedusa) said on Wednesday it is outraged by the increase, which it labelled unjustifiable.
“This pronouncement is way below the current inflation rate, and we will not allow the most vulnerable sectors of society to continuously have their disposable income further eroded while food, fuel and electricity prices keep increasing at an alarming rate,” Fedusa said.
It said it will place the issue on the agenda of the National Economic Development and Labour Council (Nedlac) when it engages the presidential working committee in March.
Cosatu parliamentary coordinator Matthew Parks said they are disappointed with the increase and lashed out at the commission for doing “shoddy work” on the matter.
“The increase is a drop in the ocean. They must go and to their work properly and come up with a proper increase for 2021 that will narrow the gap between farmworkers and domestic workers,” he said.
National Council of Trade Unions president Pat Mphela said: “We are very much disappointed because it’s not an increase, it’s below inflation. It’s [spitting] in the face of workers. There is totally no increase.
“Our economy is bleeding of course, but we don’t believe the increase will lead to job cuts,” Mphela said.
But Mkhaliphi said it is disingenuous for stakeholders to attack the commission for the increase as the commission was made up of labour, business and the community.
“All the constituencies agreed on the increase. The commission has applied its mind and it has got reasons why it took that route.”
Correction: February 24
An initial version of this story incorrectly stated that the increase was lower than the 5% recommended by the commission. The increase of 3.8% was in fact in line with the recommendations of the commission.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.