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NEASA’s submission to the national minimum wage commission

NEASA’s submission to the national minimum wage commission

On 10 September 2021, the National Minimum Wage Commission (‘the Commission’) published an invitation for written representations by the public, regarding the review of the National Minimum Wage (NMW) for 2022, and possible adjustments thereto. These representations are considered by the Commission, prior to the drafting of its annual recommendation report to the Minister of Employment and Labour.

NEASA has, after publication of this invitation, conducted a survey among employers, in order to determine what the effect of any possible adjustments to the NMW will be on their businesses, and the extent of their ability and capacity to absorb or withstand an increase. The results of this survey were processed and included in NEASA’s submission to the Commission on 1 October 2021.

In NEASA’s submission, it was clearly indicated to the Commission that, in light of the current economic climate in South Africa, the effects of the Covid-19 lockdown, as well as the recent losses due to violent lootings of mid-2021, an increase to the NMW will be catastrophic to South African businesses and the economy in general.

In summary, the following factors were discussed:

  • Inflation
  • The cost of living
  • The need to retain the ‘value’ of the NMW
  • Gross domestic product (GDP)
  • Wage levels and collective bargaining outcomes
  • Productivity
  • Ability of employers to carry on their businesses successfully
  • The operation of small, medium or micro-enterprises and new enterprises
  • The likely impact of the recommended adjustment on employment or the creation of employment
  • The effect of the Covid-19 lockdown
  • Morality of a government dictating a NMW

NEASA will await the publication of the Commission’s recommendation report and thereafter conduct another survey regarding the recommended adjustments to the NMW, should there be any.

We will keep employers abreast of developments in this regard.

To view NEASA’s submission, please click here.

By Rona Bekker, a Senior Policy Advisor at the National Employers' Association of South Africa (NEASA).

 

 

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