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The annual earnings threshold has increased! Here's what this means for your business

by , 03 July 2013
In breaking news, the Department of Labour has increased the annual earnings threshold. And according to the Government Gazette, the new earnings threshold officially came into effect from the 1st of July. Here's what you need to know about the change...

The Department of Labour has increased the annual earnings threshold from R183 008 per annum to R193 805 per annum. That's according to notice 456 in Government Gazette 36620 of 1 July 2013 published yesterday.

And it's crucial your company is in line with the new earnings threshold….

After all, warns the revised earnings threshold means employees who earn in excess of the annual threshold are excluded from certain sections of the Basic Conditions of the Employment Act (BCEA).

This has the following implications for you, cautions the experts at FSP Business.



Four implications of the earnings threshold

#1: Ordinary hours of work: In terms of the BCEA, you can ask employees who earn above the earnings threshold to work longer than the standard working hours without remuneration. Keep in mind that the maximum normal working time allowed is 45 hours a week. This means nine hours per day (excluding lunch break) if your employee works a five-day week, and eight hours per day (excluding lunch break) if your employee works more than five days per week.

#2: Meal intervals: An employee who earns above the threshold isn't entitled to a fixed lunch hour or tea time and may be required to work during those periods or take a meal interval at a time which is suitable later in the day.

#3: Daily and weekly rest period: According to the BCEA, you must allow your employee a daily rest period of at least 12 consecutive hours between ending and recommencing work. In addition, you must also grant your employee a weekly rest period of at least 36 consecutive hours, which should include a Sunday. For employees earning above the threshold, this ruling doesn't apply.

#4: Night work: The earnings threshold excludes employees who earn above the threshold from being compensated by a night shift allowance or being provided with transport home after their shift. On the other hand, employees who earn below the threshold must be compensated extra for work done after 18:00 at night.

If you're not sure how this applies to your company note this:
In terms of notice 456 in Government Gazette 36620 of 1 July 2013, employees earning in excess of the annual threshold are excluded from sections 9, 10, 11, 12, 14, 15, 16, 17(2) and 18(3) of the BCEA. These sections refer to:

  • Ordinary hours of work
  • Overtime
  • Compressed working week
  • Averaging of hours at work
  • Meal intervals
  • Daily and weekly rest periods
  • Compensation for work on Sundays, at night or on public holidays
     


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