On July 1 2013 the minister of labour announced that, with immediate effect, the earnings threshold in the Basic Conditions of Employment Act, which excludes employees earning above the threshold from certain entitlements and protections, will increase from R183,008 a year to R193,805 a year – an increase of approximately 5.9%.

Employees earning above this threshold are excluded from working time protection, such as:

  • maximum ordinary working hours;
  • meal intervals;
  • limits on how much overtime they are permitted to work;
  • enhanced rates of pay for overtime and Sunday work;
  • minimum rest intervals; and
  • access to transport for night work.

The increase in the threshold therefore extends working time protection to employees who are currently earning between R183,008 and R193,805. Employers employing workers who earn in this range may therefore need to review their working time arrangements with such employees and payroll to ensure that they are compliant.

The definition of 'earnings' for the purpose of the threshold remains unchanged:

"The regular annual remuneration before deductions, i.e. income tax, pension, medical and similar payments but excluding similar payments (contributions) made by the employer in respect of the employee: Provided that subsistence and transport allowances received, achievement awards and payments for overtime worked shall not be regarded as remuneration."

Employers should take care to avoid unintentionally granting their employees contractual rights (over and above the statutory rights) to working time protection – otherwise, employees whose earnings increase beyond the threshold, which would ordinarily result in them no longer being entitled to the statutory working time protection, may end up still being entitled to the protections because their contracts (entered into at a time when they earned less than the threshold) inadvertently give them contractual rights thereto.

For further information on this topic please contact Stuart Harrison at Edward Nathan Sonnenbergs by telephone (+27 21 410 2500) or by fax (+27 21 410 2555) or by email (sharrison@ens.co.za).

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