New minimum wage to boost worker income: what employers need to know

17 February 2025 | Economic factors

By: Staff Reporter - IOL

IN a significant move aimed at improving workers' livelihoods across South Africa, the government announced that a new minimum wage will come into effect on March 1. This change is expected to impact a wide range of industries, and employers are urged to familiarise themselves with the new regulations to ensure compliance, explains Managing Director at Strata-g Labour Solutions, Advocate Tertius Wessels.

The new minimum wage has been set at R28.79 per hour, an increase from the previous rate of R27.58. This adjustment is part of the government’s ongoing efforts to address income inequality and ensure that all workers receive a fair wage. Employers must update their payroll systems and ensure that all employees are paid at least the new minimum wage from the implementation date.

The new minimum wage will affect all employees currently earning below R28.79 per hour. This includes part-time workers, temporary staff, and those on casual contracts. Employers in sectors such as retail, hospitality, and domestic work, where lower wages are more common, will need to pay particular attention to these changes.

Wessels emphasises the importance of compliance: “Employers must ensure they are fully compliant with the new minimum wage laws. Failure to do so can result in significant penalties, including fines and potential legal action. Employers must review their current pay structures and make the necessary adjustments before the 1 March deadline.”

In addition to the new minimum wage, employers should also be aware of other relevant labour laws. These include regulations on working hours, overtime pay, and employee benefits. Ensuring compliance with all labour laws not only protects employers from legal repercussions but also promotes a fair and productive workplace.

Steps for Employers

1. Review Current Wages: Assess the current wages of all employees to identify those who will be affected by the new minimum wage.

2. Update Payroll Systems: Ensure that payroll systems are updated to reflect the new minimum wage from 1 March 2025.

3. Communicate with Employees: Inform employees about the upcoming changes and how it will affect their pay.

4. Seek Legal Advice: Consult with legal experts, such as those at Strata-g Labour Solutions, to ensure full compliance with all labour laws.

“The implementation of the new minimum wage is a positive step towards ensuring fair compensation for all workers. Employers must take proactive steps to comply with the new regulations and uphold their legal and ethical responsibilities. By doing so, they contribute to a more equitable and just society,” Wessels concluded.