National Minimum Wage to Increase from 1 March 2025

Accountants should take note of the upcoming changes to the National Minimum Wage (NMW), which will increase from ZAR 27.58 to ZAR 28.79 per hour starting 1 March 2025. This 4.38% increase is slightly lower than the National Minimum Wage Commission’s recommendation.

Sector-Specific Adjustments:

• Farmworkers and Domestic Workers are now entitled to the full NMW of ZAR 28.79 per hour (previously, farmworkers and domestic workers were paid at lower rates).

• Expanded Public Works Programme minimum hourly wages increase from ZAR 15.16 to ZAR 15.83.

• Learnership Agreements allowances (under the Skills Development Act) remain as per Schedule 2.

• Contract Cleaning Sector:

  • Major metros (e.g., Cape Town, Johannesburg, Tshwane) – minimum hourly wage set at ZAR 31.69.

  • KwaZulu-Natal – wages must follow the Bargaining Council’s collective agreement.

  • Other areas – minimum hourly wage of ZAR 28.89.Additional increases were announced for these sectors. Employers in these industries should ensure compliance with the newly prescribed wage rates.

Compliance and Enforcement

The Department of Employment and Labour warned the employers cannot change working conditions or reduce working hours to offset the NMW increase as this is illegal and constitutes unfair labour practice. The minimum wage excludes payments such as:

• Allowances (e.g., transport, food, lodging)

• Payments in kind (e.g., board or lodging)

• Tips, bonuses, or gifts.

This increase aims to support living wages for workers while balancing economic conditions. Employers must ensure compliance to avoid penalties.To strengthen enforcement, the Department has announced a major expansion of its inspectorate from 2,000 to 20,000 officers, which will significantly increase labour inspections and compliance audits.

The Next Steps for Employers and Accountants

• Review payroll structures to align with new wage rates.

• Ensure compliance with sector-specific minimum wages.

• Advise clients on collective bargaining agreements, if applicable.

• Prepare for increased inspections and enforcement action.

Non-compliance can result in penalties, reputational risks, and legal consequences. Accountants should proactively guide businesses on these regulatory changes to mitigate risks.

Download the Government Notice for more detail.

Source: Article in Webber Wentzel