From 1 April 2025, the earnings threshold under the Basic Conditions of Employment Act (BCEA) will increase, impacting not only the BCEA but also employee protections under the Labour Relations Act (LRA) and Employment Equity Act (EEA).
Broadly speaking, employees earning less than the threshold amount are entitled to stronger labour protections.
The new threshold
The threshold rises by only 2.9% this year, increasing from R254,371.67 per year (R21,197.64 per month) to R261,748.45 per year (R21,812.37 per month).
What counts as “Earnings”?
“Earnings” (for this purpose only) means “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”.
The impact on employee protections
- BCEA: Employees earning above the new threshold aren’t entitled to statutory protections for working hours, overtime pay, Sunday, public holiday and night work, daily and weekly rest periods and meal intervals.
- LRA: Those earning below the threshold gain stronger protections:
- If working for a client via a labour broker for more than three months, they are deemed employees of the client – unless they really are performing a temporary service.
- Fixed-term contracts exceeding three months are presumed indefinite unless the employer has a justifiable reason for fixing the term of the contract.
- EEA: Employees earning above the threshold can only take unfair discrimination disputes (except sexual harassment cases) to the Commission for Conciliation, Mediation and Arbitration (CCMA) if both parties agree. Otherwise, they must approach the Labour Court.
Exceptions to the BCEA protections
Some employees have limited BCEA protection regardless of their earnings, including:
- Senior managerial employees – defined as “an employee who has the authority to hire, discipline and dismiss employees and to represent the employer internally and externally”.
- Sales staff who travel to customers and set their own work hours.
- Employees working less than 24 hours a month.
Please ask us for specific advice if you need it. This article is merely an overview of a complex topic with many pitfalls for the unwary.
For more information, contact our Employment Law department.
Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice.
© LawDotNews