Thulas Nxesi reveals non-compliance with national minimum wage

Employment and labour minister Thulas Nxesi says some companies still pay their employees below the minimum hourly rate of R23.19 despite mandatory changes announced earlier this year. 

Nxesi revealed this in a written reply to an EFF MP who asked if the department is able to ascertain whether retailers pay their employees fairly or “less than R3,500 per month”.

In his response, the minister clarified that R3,500 is not the minimum wage but a minimum of R23.19 per hour payable for the number of ordinary hours worked.

The departmental commission responsible for making recommendations on the national minimum wage (NMW) had established that some employers were non-compliant. 

“The latest quantitative research shows the average level of NMW non-compliance in 2020 Q1, before the NMW was adjusted, was 35.8%, meaning that about 36% of workers were paid below the NMW.

"A year later, in 2021 Q1, this number remained much the same, at 36.2%. In 2020, the NMW was adjusted by 3.8%, and wages appeared to have risen by roughly this amount for those who remained employed in 2021 Q1, meaning that the overall rate of non-compliance remained stable."

The agricultural sector had more employees who earned below the minimum wage than others.

Non-compliant sectors include construction, wholesale and retail trade, and domestic work.

Nxesi could not name the companies found to be non-compliant. 

“It is important to indicate, however, that the quantitative research looks at changes to working hours, employment, wages and non-compliance as a result of changes in the NMW across different sectors and not on individual companies," he explained. 

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