From 1 March 2023 until 31 March 2024, the earnings threshold was R241 110.59 per annum and R20 092.54 per month (Government Notice No. 3067, published on 20 February 2023).
Section 6 of the Basic Conditions of Employment Act (BCEA) makes provision for the Minister of Employment and Labour to determine an earnings threshold.
The effect of such a threshold is that it excludes employees earning above the determined amount from the protection offered to employees under certain sections of chapter 2 of the Basic Conditions of Employment Act, that primarily deals with the regulation of working hours of employees. The sections from which such employees are excluded are:
9. Ordinary hours of work
10. Overtime
11. Compressed working week
12. Averaging of hours of work
14. Meal intervals
15. Daily and weekly rest period
16. Pay for work on Sundays
17. Night work -17(2) that deals with transport and night shift allowances
18. Public holidays – 18(3) that deals with payment for work on a public holiday that falls on a day on which the employee would ordinarily not have worked.
Additionally, as per sections 198, 198 A, B, C and D of the Labour Relations Act, employees earning below the earnings threshold are considered to be vulnerable and are entitled to additional protection pertaining to non-standard employment arrangements such as fixed term contracts, labour broker and part-time employees.
From 1 April 2024, the earnings threshold increased to R254 371.67 per annum and R21 197.63 per month (Government Notice No. 50254, published on 5 March 2024).
“Earnings” means gross pay before deductions, such as income tax, pension, medical insurance, and similar payments, but excludes similar payments (contributions) made by the employer in respect of the employee.
Employees earning below the threshold amount:
- These employees are entitled to the full protection of every section of the Basic Conditions of Employment Act (BCEA).
- Additionally, such employees are also considered to be vulnerable for the purposes of non-standard employment arrangements as per the Labour Relations Act.
Employees earning above the threshold amount:
- These employees do not have a statutory right to demand minimum employment conditions insofar as it relates to the provisions of sections 9, 10, 11, 12, 14, 15, 16, 17(2), and 18(3) of the BCEA.
- Employment conditions dealt with under the aforementioned sections may be negotiated between employer and employee.
- The agreed employment conditions may well be less favourable than those applicable to employees earning below the threshold.
As Employer, it is important to understand and comply with the Basic Conditions of Employment Act and to ensure that all employees are treated fairly within a safe and equitable working environment.
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