Here is the new ‘earnings threshold’ for South Africa

 ·9 Feb 2022

Labour and employment minister Thulas Nxesi has announced a new annual earnings threshold under the Basic Conditions of Employment Act (BCEA), which will have implications for South African employees.

In a gazette published on Tuesday (8 February), Nxesi announced that the new earnings threshold will be R224,080.48 per year (approximately R18,673 per month) from 1 March 2022. Previously, the earnings threshold was R211,596.30 per year (approximately R17,633 per month).

The earnings threshold is the ‘dividing line’ where certain provisions of the Labour Relations Act (LRA) and the Employment Equity Act (EEA) apply.

The sections covered in these acts are intended to protect vulnerable employees and regulate, amongst other things, hours of work, overtime, work over weekends, lunch breaks and even where labour disputes need to be handled.

Employees earning under this threshold enjoy the full protection of the BCEA, and can, for example, demand overtime pay at a rate of 1.5 times, or legally refuse to do more than the 45 hours of work a week.

However, any employees earning above the threshold are precluded from these automatic protections – meaning they are not automatically entitled to overtime or weekends off, for example. These issues are still relevant to higher earners, but are typically handled in contract negotiations with respective employers at the time of employment.

“Earnings includes the employee’s regular annual remuneration before deductions, but excludes benefits such as subsistence and transport allowances, achievement awards and payments for overtime worked,” said legal experts at ENSAfrica.

“The increase in the threshold will mean that from 1 March 2022, some employees who earn more than R211,596.30 but less than R224,080.48 per year may be entitled to additional protections, such as overtime payment when working more than 45 hours per week, compulsory breaks and rest periods, night work allowances and the like.”

Additional comment by Lauren Salt (executive) and Jessie Gertzen (candidate legal practitioner) at ENSAfrica. 

Read: New ‘living wage’ for South Africa

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