Considering that the previous increase came into effect on 1 March 2016, one may be forgiven for assuming that the implementation date of the new minimum wage rates in the Wholesale and Retail Sector would be 1 March 2017. But the effective date of the increase this year is 1 February 2017.
Reason for confusion
When the minimum wages in the Wholesale and Retail Sector were first published in December 2002, they came into effect on 1 February and were increased annually on the same date. According to the Department of Labour the 2016 wage tables were published late and could only be enforced from 1 March 2016 (instead of 1 February 2016). The indication on the wage tables that they would remain valid until “31 February 2017” was a mistake. The effective date of the latest increase is in fact 1 February 2017.
Narrowing of wage gap
The increases vary according to job category, but there is also a difference depending on the area where the employer is situated. Since the inception of the Sectoral Determination, employees in urban areas have been entitled to a higher minimum wage than those in rural areas. This year there is a difference in the percentage increase between employees in urban areas (who get a 7,3% increase) and employees in the rural areas (who get a 8,8% increase). As a consequence there is a slight narrowing of the wage gap.
Effect of National Minimum Wage
In some categories still earn less than the R20 per hour minimum envisaged for a new ‘National Minimum Wage’ that is likely to be implemented from May 2018. Some details still need to be fleshed out and it is too early predict how it will affect increases in the Wholesale and Retail sector next year. One would expect the lowest wages to be brought in line with the National Minimum Wage, though.
For the new wage tables in our members section, CLICK HERE.