Question: Does an employee have a right to an annual wage increase?
Answer: There is no general duty on an employer to give an annual increase.
Brief explanation: The Basic Conditions of Employment Act of 1997 does not make provision for minimum wages or wage increases. However, if the employer’s business falls in an industry or geographic area where a Bargaining Council Agreement or Sectoral Determination applies, the employer has to comply with minimum wage stipulations contained in such Agreement or Determination. If the employee is already earning the same or more than the applicable minimum wage, the is no obligation to increase the employee’s wages.
If you are unsure whether such an agreement applies to your business, please contact our offices.
5 Comments
Your statement that if an employee is equal to or above the minimum wage that is prescribed by the bargaining council there is no obligation to award a further increase.
What if the bargaining council says regardless of the current wage all employees will receive a 5 % increase?
Then presumably you will ahve to award the increase.
Dear Labourwise Team, we have an empoloyer in our service for more than 10 Years. he received a yearly increace of 7-10% yearly. He has now reached a salary income way above the normala domestic worker . He got upset this year when we did not grant him his yearly bonus, which was always substancial.
( received yearly bonus throughout his employment. ) Kindly advise. Trudi
Sometimes the main agreement stipulates that salaries of employees earning more than the minimum wage must also increase by a certain percentage!
I suspect that you are confusing the bargaining council with the union. They are two different entities. A union cannot prescibe any increase that is more than the minimum increase that the sectoral determination or bargaining council agreement stipulates unless there was a prior agreement with the employer.
Assuming that the understanding was that the bonus was variable and discretionary, he would not have a right to a bonus. Presumably you had reason for not paying the bonus, in which case we suggest that you make an effort to explain to him the basis on which you normally make your decision to pay a bonus and why he did not receive one this time.