More South African workers will benefit from basic labour protections after Employment and Labour Minister Thulas Nxesi announced that the legal earnings threshold for employees would be raised on 1 April 2024.
Legal experts said this week that the fact that more people will benefit from the Basic Conditions of Employment Act (BCEA) and other labour laws is a positive development, noting that employers must ensure they comply and afford workers the legal protections.
According to the Act, the minister determines the earnings threshold. Those earning above that threshold — which from 1 April will increase from R241 110.59 to R254 371.67 a year — are excluded from certain provisions of the BCEA as well as provisions of the Labour Relations Act (LRA) and the Employment Equity Act.
Cliffe Dekker Hofmeyr labour attorney Thabang Rapuleng said the earnings threshold refers to an employee’s cost to company and includes regular annual remuneration before deductions such as income tax, pension, medical and similar payments.
The increase in earnings threshold means more workers are now afforded the protections offered through certain provisions of the BCEA regulating overtime and work hours, Rapuleng said.
Similarly, fixed-term or temporary workers who earned between R241 110.59 and R254 371.67 a year and were previously excluded from LRA provisions will now be included in the bracket of employees that are afforded protection by various labour regulations, he added.
Rapuleng said these changes apply to full-time and part-time employees, as well as outsourced workers and include all aspects of basic conditions of employment, such as protections relating to public holidays and Sunday work, rest periods and meal intervals.
For example, the BCEA states that an employer must pay double a worker’s hourly wage if they work on a Sunday. If the worker ordinarily works on a Sunday, the employer must pay them one and a half times their hourly wage. This does not apply to employees earning above the threshold.
According to Rapuleng, for employees earning above the threshold to be legally entitled to the same or similar benefits, they must negotiate with their employers to get these provisions included in their employment contracts. They can do so through collective bargaining, he said.
Rapuleng warned that a higher income might exclude workers from getting paid overtime. “We caution employees to know and understand the implications of earning above the threshold,” he said. “A high salary comes with its own implications of not having certain protections automatically being afforded to you.”
He also said employers must take note of workers who are now included in the new earnings bracket and ensure they grant them the requisite legal protections.
A Werksmans Attorneys spokesperson said workers who earn above the threshold may still take labour disputes against employers to the Commission for Conciliation, Mediation and Arbitration, although this may have a bearing on some disputes.
Marthinus van Staden, of the University of the Witwatersrand’s School of Law said employees earning above the earnings threshold are generally regarded as less in need of protection than their more vulnerable counterparts.
“Those earning above the earnings threshold earn higher salaries and are, theoretically at least, in a better position to enter into a contract of employment in which they are provided with protection,” he said.
“Often, however, this is not the situation faced in practice by employees who earn more than the earnings threshold.”
He said these workers do not have any legal entitlement to overtime pay or time off in lieu, unless provided for in their contract of employment or collective agreements. But there are still other protections that they are entitled to, irrespective of their earnings.
For example, no employee may work more than 12 hours in total on any day, Van Staden noted.
“Earnings thresholds have been in place in South Africa since the 90s. Although the amount was raised, this was merely a mechanism to keep up with the increase in salary adjustments,” he said, adding that the change will probably have a small effect.
“The raising of the earnings threshold is a good thing. It brings more employees into the realm of protection. This approach tries to advance flexibility in employment relations and has worked successfully for decades.”