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Does my employee have a legal right to an annual salary increase?

by , 03 November 2014
Around this time of the year, our labour experts get a lot of questions about bonuses and salary increases.

One question they got recently comes from an employer from Joburg. She wants to know whether or not her employee has a legal right to an annual salary increase.

Read on to find out the answer...


No, your employee doesn't have a legal right to an annual increase

 
That's right.
 
In this article, experts behind the Labour Law for Managers Loose Leaf Service explain that you don't even have to negotiate salary increases, unless:
 
  • Your employment contracts say you will;
 
  • You have a collective agreement with a trade union; or
 
  • There's a bargaining council agreement or sectoral determination that applies to your sector that says you have to.
 
Keep these two points in mind when it comes to annual salary increases…

 
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And that's why most employers think the obvious thing to do is just deduct the amount your employee owes you from his salary.

But it's not that easy! You will land up at the CCMA if you don't deduct money legally.

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When it comes to annual salary increases, always remember these two points

 
1. Put everything in writing
 
If you don't have a contractual or collective agreement that says you'll give an increase, include a clause in your employment contracts.
 
The clause must state that your employees have no automatic right to an increase and you'll give them at your discretion.
 
2. Consistency is key when it comes to annual salary increases
 
When you do give salary increases, be clear about your criteria for doing so.
 
You must tell your employees about the criteria and enforce it consistently. If you aren't consistent, your employees could take you to task for unfair labour practices.
 
The bottom line: Your employee doesn't have a legal right to an annual increase.
 
PS: For more information on salary increases, check out the Labour Law for Managers Loose Leaf Service. The Loose Leaf Service also gives you all the details you need for maximum protection in labour-related problems.
 

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