The hourly rate has been increased to R11,66, the weekly rate to R525 and the monthly rate to R2274,82. The changes to the sectoral determination for farm workers were announced by Labour Minister Mildred Oliphant during a press conference on Monday. She said that the new sectoral determination would apply for a three year period and that during year two and three, wages would increased by CPI (Quintile 1) plus 1,5%.
“In line with the new minimum wage, the Department of Labour (DoL) will, towards the end of term of the new wage dispensation, undertake a study to assess the impact of the new wage in the sector,” the minister said. Oliphant said that the decision to increase in the minimum wage by 52% was made based on a study done by the Bureau for Food and Agricultural Policy (BFAP) about the impact of farm worker wage increases on the agricultural sector.
The study, which was done under the leadership of Dr Ferdi Meyer of the University of Pretoria, found that if farm worker wages increased to around R104 per day, many of the typical farms would be unable to cover their operating expenses, but at R104 per day farm workers would not be able to afford a daily balanced diet. In response to this finding Oliphant announced that the DoL would forward the BFAP report to NEDLAC for consideration in dealing with the long term issues relating to the transformation of the agricultural sector in South Africa.
Representatives of farmers’ organisations were quick to respond to the announcement of the new minimum wage on social networks, saying that the new minimum wage will be unaffordable for many farmers. According to Agri SA deputy president, Theo de Jager, many farmers will have to restructure their operations and this will undoubtedly lead to job losses.
During the press conference Minister Oliphant said farmers who were unable to afford the new minimum wage could apply to the DoL for exemption if they could submit financial statements supporting their claim that at a daily wage of R105 per worker they would be unable to cover operating costs. She also urged farmers who might consider dismissing workers due to the increase in the minimum wage to make use of government subsidies and training layoff schemes.
