National Minimum Wage Bill
1. Can you please explain exactly what the implementation of the Minimum Wage Bill would look like?
The implementation of the minimum wage bill has still some way to go. The National Assembly of our parliament has passed this bill, but it still has to go to the National Council of Provinces. There still needs to be some public input into this, and only after the public input has been taken and the National Council of Provinces approve it, will it be sent to the President. I believe that this will take another 3-4 months.
2. What impact do you believe this will have on people who currently earn less than what it stipulates?
I strongly believe that implementation of the national minimum wage will create all sorts of problems in the work force. The National Treasury tell us that it will lead to about 750,000 jobs being lost, and I believe it will be a lot more.
3. How do you think companies, who will have to adjust their payroll, will respond to this bill?
Many of the companies have already stopped recruiting, and many will undergo an exercise of retrenchment if they can’t afford. The government has said that the businesses will be able to apply for exemption, however, notoriously exemptions are difficult to obtain and are also very difficult to apply for. The exemption process is normally extremely onerous and it is believed that small businesses won’t apply for the exemptions but will merely retrench their staff.