TLU SA comments on suggested national minimum wage – TLU SA believes the government should completely set aside the minimum wage until the economy and employment rates pick up and therefore submitted formal comments against the proposed recommendations of the National Minimum Wage Commission.
The commission must, according to the National Minimum Wage Act review the minimum wage on an annual basis. One of the critical suggestions of the commission is to increase the minimum wage for farmworkers to the suggested national minimum wage of R21.69 per hour.
“The lockdown regulations of 2020 severely damaged the South African economy, and thus a standard approach to adjusting the minimum wage will not be feasible,” says Mr Henry Geldenhuys, the president of TLU SA. “The ability of employers to maintain the expenditure of salary levels before the introduction and implementation of lockdown regulations was severely affected, resulting in the highest levels of unemployment in recent history. Unemployment is the biggest threat to creating stability in the country and a future for South Africans. An increase thereof due to increasing the minimum wage will result in negative consequences.”
The government should realise that a minimum wage stands in the way of the freedom of choice of jobseekers. If someone chooses to work for R100 a day getting experience and an income, rather than receiving a grant of R40 a day, it should be their choice. More than ever before, what the country needs now is increased employment, resulting in counter-poverty outcomes.
“The government should seriously review its approach to labour,” says Mr Geldenhuys. “Each decision should be tested by its effect on economic growth. The government should create initiatives for business to employ more labourers instead of creating unemployment. South Africa’s policy environment is unfavourable to trade and investment.
“The best outcome for the country, business and labour will be when market powers regulate labour.”