Formulated by National Economic Development and Labour Council (Nedlac), the new Minimum Wage Act will see the minimum hourly rate for workers set at R20 and will come into effect on 1 January 2019. The new law allows for the annual adjustment of the minimum wage by a still-to-be-appointed commission, which will be required to conduct a review of the said wage within 18 months of the commencement of the act.
The setting of the wage has been a hot topic of contention by parties arguing either end of the problem.
On one hand, it's been admitted that R20 per hour does not constitute a living wage; on the other, it was argued that it could lead to job cuts when those who are unable to comply simply dispense with staff instead.
However, it has been factored in that those employers who are unable to pay the minimum wage due to business constraints may apply for an exemption.
Three other bills were also signed into law by Ramaphosa today. These are the Labour Laws Amendment Bill, amendments to the Basic Conditions of Employment Act, and the Labour Relations Amendment Bill.
