South Africa’s Top Labor Federation Agrees to Minimum Wage
(Bloomberg) -- South Africa's main labor union federation accepted a government-proposed minimum wage of about 3,500 rand ($268) a month, calling it a “step forward for the country.”
While Cosatu favored a minimum monthly salary of 4,500 rand a month, the government's proposal “is still a significant starting base towards a living wage,” Congress of South African Trade Unions Secretary-General Bheki Ntshalintshali told reporters Thursday in Johannesburg. President Jacob Zuma's administration wants it to start on May 1 next year.
The government has said businesses that aren't able to afford the minimum wage for a 40-hour week will be able to apply for an exemption. Africa's most-industrialized economy, which has an unemployment rate of almost 27 percent, has 6.6 million people earning less than 3,500 rand monthly, Deputy President Cyril Ramaphosa said last month.
S&P Global Ratings, which has had a negative outlook on South Africa's BBB- assessment for more than a year, has said the country needs to reform labor laws to reduce protracted strikes and create certainty about black empowerment laws in mining to avoid a cut to junk. Fitch Ratings Ltd. also has South Africa at the lowest investment grade, while Moody's Investors Service rates the nation's debt one level higher.
To contact Bloomberg News staff for this story: Sam Mkokeli in Johannesburg at mmkokeli@bloomberg.net.
To contact the editors responsible for this story: Karl Maier at kmaier2@bloomberg.net, Gordon Bell
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