News

IRR’s call for minimum wage reduction is nonsensical: Cosatu

todayJanuary 25, 2025 306

Background
share close

Labour federation, Cosatu, has described the Institute of Race Relations’ call for government to reduce the country’s current minimum wage of R27.58 to save jobs as nonsensical.

The trade union federation says the claims are baseless and disregard the country’s transformative laws.

“The claims have no relation, whatsoever, to any facts. They have provided zero research, zero evidence,” explains says Cosatu’s Parliamentary Coordinator, Matthew Parks.

“The fact is that the minimum wage has not led to any job losses in any significant nature. The minimum wage was agreed to after lengthy discussions and research at NEDLAC over two years by governed businesses and labour, with the support of academic experts from universities. It was carefully chosen to be the right amount, to be meaningful, to uplift poorly paid workers, – who are paid a little more than the slave-wage, some a little as R6 an hour; not enough to buy even half a loaf of bread, but not to be too high to be unaffordable, especially for SME and major sectors and not to cause job losses,” he adds.

Parks says independent research has shown that the current minimum wage has helped alleviate hunger.

“In fact, it has helped to reduce poverty, inequality, and stimulate economic growth.”

Parks says workers who buy goods in local shops, help companies, which sell these good to keep themselves in the market, as well as companies producing the goods. He says the base pay also helps the state with taxes to fund public services, which help grow the country’s economy.

He believes the current base wage is another step closer to contributing to the country’s economic growth, although more still needs to be done.

“It’s not the end of the road. It’s simply one step to try to reduce the legacy of poverty and equality to try to uplift people, to try to stimulate the economy. Other things must be done to grow the economy to make sure that workers are paid a living wage and to invest in workers’ social wage.”

Parks urges government to employ more labour law inspectors who can ensure compliance.

He says there’s also a need for trade unions who won’t shy away from calling out employers who are found wanting. He says they should also ensure that fitting penalties are sanctioned against them and incentivise those who comply. Written by Odirile Rabolao

Written by: Lindiwe Mabena

Rate it

0%