In addition to our Channel Chat dated 4 February 2019, the following refers:
MINIMUM WAGE EXEMPTION PROCESS
Maximum exemption: There will not be a full exemption of the National Minimum Wage (NMW). The most a successful exemption is a 10 (Ten)% reduction:
|Category||Minimum Wage/hour||Maximum exemption|
|Employees||R20.00 per hour||R18.00 per hour|
|Farm Workers||R18.00 per hour||R16.20 per hour|
|Domestic Workers||R15.00 per hour||R13.50 per hour|
Conditions: An exemption will only be granted if:
- The employer cannot afford to pay the national minimum wage; and
- representative trade union(s) or employees are consulted with.
- Complete compliance with applicable statutory payments and obligations, including UIF, Workmen’s Compensation and Bargaining Council Collective Agreement. If this has not been done – don’t bother applying for exemption.
Employers will be required to submit audited financial statements, household income, commercial balance sheets, working hours, supporting statements from the employees, motivation and any other documents as evidence to justify the application for an exemption.
To assess affordability, the Department will take elements of profitability, liquidity and solvency into account.
Bargaining Council minimums: If the Bargaining Council- Sectoral Determination minimum wage is less than R20. (Twenty) per hour, then the national minimum wage takes precedence and those wages will need to be increased to R20. (Twenty) per hour, regardless of the Council or Determination’s minimum wage.
Term: Exemption will never be more than 12 (Twelve) months from the date of application.
Dishonesty: If an employer has lied in the application, or its financial position improves, the exemption can be withdrawn. Any person affected by the exemption can apply to have the exemption withdrawn.
Pending: Until exemption has been granted all employers are required to pay the prescribed minimum wage and all Employees are entitled to earn no less than the prescribed minimum wage. Should an employer fail to pay the minimum wage prior to exemption being granted, the Employees will be entitled to approach the Labour Department and demand back pay as they did not earn the monies due to them.
In January 2021, the minister will announce whether the national minimum wage will be adjusted.
The application for exemption is on-line at https://nmw.labour.gov.za/
André Naudé Ph.D.
Chief Commercial Officer