COSATU welcomes the National Minimum Wage Commission’s commitment to above-inflation annual increases

10 May 2023

The Congress of South African Trade Unions (COSATU) welcomes the National Minimum Wage Commission’s recently released report on its medium target for the National Minimum Wage (NMW), and in particular the key progressive commitments it has made to uplift and enhance the NMW. The Federation supports the three key agreements reached by the NMW Commission with respect to the NMW, namely:

The value of the NMW, including its purchasing power and its ability to act as a poverty relief intervention must be protected as per the NMW Act.

The NMW must be adjusted annually by an amount higher than inflation to ensure we are able to narrow the wage gap and uplift the most poorly paid workers.

The ratio between the NMW and median wage average must be narrowed and not allowed to widen, thus compelling the Commission to ensure the NMW is adjusted by above-inflation increases annually.

Whilst COSATU would have liked to see more specific medium targets for the NMW to reach, we welcome the broad thrust of the Commission’s progressive commitments as they will help ensure that future increases are above the inflation and make a difference to workers and protect the value of the NMW or its ratio to the median wage from being eroded. COSATU will continue to monitor the impact of the NMW and its annual adjustments and when it becomes necessary to consider additional interventions, will do so.

The Commission’s progressive commitments to further enhance the value of the NMW follow the healthy above-inflation increases to the NMW that we have been able to win since it came into effect in 2019, namely:

Domestic workers from R15 to R25.42 (a 69% increase)

Farm workers from R18 to R25.42 (a 41% increase)

All other workers from R20 to R25.42 (a 27% increase)

Whilst COSATU is pleased by the NMW Commission’s commitments and the healthy above-inflation increases in the NMW, we are deeply concerned about research showing that 45% of employers affected have been ignoring the NMW. This is a criminal offence and needs to be treated as such.

The Department of Employment and Labour needs to aggressively deploy its inspectors to high-risk sectors to ensure compliance and where necessary to issue penalties. Treasury and all government institutions need to ensure that any company seeking to do business with the state is in compliance with the NMW Act. BUSA and other business associations need to do their bit and engage their members on the need to abide by the NMW Act and not just the laws that suit their profits. COSATU will be ramping up its campaigns on the ground with its Affiliates to ensure all workers are aware of their rights and to audit and deal with employers who continue to undermine the NMW Act and other labour laws.

Issued by Matthew Parks, Parliamentary Coordinator, COSATU, 11 May 2023