The National Minimum Wage Act applies to all employers and employees in South Africa. According to this Act, an employee should be paid a minimum amount per hour or per month depending on the number of hours they work. It is illegal to contract a person at a lower rate than the minimum wage, but you can agree to pay a higher rate.
Each year, the Department of Employment and Labour reviews the minimum wage that must be paid to employees. It is officially published in the government gazette to be effective from 1 March.
From 1 March 2025, the minimum wage is R28.79 for every ordinary hour worked. The only exception is employees who work for a public works programmes whose minimum wage is R15.83 per hour.
How to calculate minimum wage.
It depends on the number of hours the employee works.
Let’s work through two examples:
Selinah is employed at your ECD centre. Her working hours are 8:00am to 4:00pm, Monday to Friday with 1 hour off for lunch. Therefore, daily, she works 7 hours a day, (8 hours minus 1 hour off for lunch). She works 35 hours a week.
Pumla is employed at your ECD centre. Her working hours are 8:00am to 5:00pm, Monday to Friday with 1 hour off for lunch. Therefore, daily, she works 8 hours (8 hours minus 1 hour off for lunch). She works 40 hours a week.
To calculate remember there are 4.3 weeks in a month
| 35 hours a week (Selinah’s Example) | 40 hours a week (Pumla’s Example) | |
|---|---|---|
| Hourly Rate | R28.79 | R28.79 |
| Daily Rate: hourly rate x hours worked in a day | R201.53 (R28.79 x 7) | R230.32 (R28.79 x 8) |
| Weekly Rate: daily rate x number of days worked in a week | R1 007.65 (R201.53 x 5) | R1 151.60 (R230.32 x 5) |
| Monthly Rate: weekly rate x 4.3 | R4 332.89 (R1007.65 x 4.3) | R4 951.88 (R1 151.60 x 4.3) |
What are the penalties for not complying to the Minimum Wage Act?
Any employer who breaks the law on the Minimum Wage Act could be fined by a labour inspector an amount equal to 2x or 3x the value of the underpayment or 2x or 3x the monthly wage, whichever is greater. That is a lot of money and could put your centre at risk.
Top Tips:
Think carefully about which staff you need to be at your centre at different times. If you plan your staffing carefully you will be more likely to meet the minimum wage requirements. You might only need a cook in the mornings or some of your teachers could perhaps only work mornings.
When determining salaries the following should be considered:
- Affordability of the centre
- the actual role and its responsibilities
- the minimum qualifications for the role
- the market related salary for that role
- the competency of the individual