All farmers must pay the minimum wage

April 2025

DIRK COETZEE, LABOUR RELATIONS SPECIALIST

THE NATIONAL MINIMUM WAGE WAS IMPLEMENTED FOR THE FIRST TIME IN 2019. DURING THIS PERIOD, A MASSIVE INCREASE WAS IMPLEMENTED ON TOP OF THE SECTORAL DETERMINATION FOR THE AGRICULTURAL SECTOR.

The question is often raised whether South African farms can effectively accommodate a minimum wage within the current production and economic climate. The answer to this question is always that the minimum wage is a way to manage a complex employee/employer relationship in such a way that it benefits both parties. It is up to the employer to ensure that the performance received in exchange for the salary imposed is up to the standards of efficiency that he requires.

ANNUAL INCREASE
When the first sectoral determination was implemented in 2012, an hourly salary of R7,71 was promulgated. Since then, there has been a significant increase every year.

This year is no different, and from 1 March 2025, all employers in South Africa (including agricultural business units) had to increase their salaries to at least R28,79 per hour worked. Even though the 2025 increase is a modest 4,38% on the previous wage of R27,58, labour specialists are already receiving questions on how to keep agricultural businesses sustainable within the sphere of rising staff costs.

It is very important to note that the National Minimum Wage Act applies to all employees in all sectors, with no distinction between small, medium and/or large enterprises.

• Therefore the practical application of this clause means that, irrespective of whether you have one or 50 staff members, you must comply with the minimum requirements stipulated.
• This National Minimum Wage Act covers all employees on your farm – farm workers and domestic workers.

TAKE NOTE
The purpose of this article is to communicate the change to the wage, but it would be irresponsible not to focus on the numerous other acts that are influenced by the National Minimum Wage Act.

In terms of enforcing non-compliance with the Act, the CCMA is now empowered to hear cases and make determinations on the underpayment and/or any non-compliance to any section of the Act. The CCMA can order payment and impose fines.

• The new Employment Equity Regulations also state that in order to receive a compliance certificate, employers must comply with the National Minimum Wage Act. Therefore it is clear that employers must ensure that they are in compliance with the hourly wage set by the Act.

Please remember that a national minimum wage assists in addressing numerous socio-economic pressures that workers face. However, it should be part of a system that is specifically developed for a farm to ensure that all workers are effective contributors to a sustainable business.

CONTACT US
The Excelsis Group, who are labour specialists, recognises the importance of sustainability and the role that farmers and their workers play in ensuring food security. They are therefore willing to assist anyone with questions on the above-mentioned systems of efficiency. Contact the author on 082 443 0296 or send an e-mail to dirk@nvbd.co.za.

Publication: April 2025

Section: Pula/Imvula