MEIBC: Seifsa's contextualisation: Out of context.

MEIBC
Seifsa’s contextualisation
OUT OF CONTEXT

by Jaco Swart

Dear Steel Industry employer

The Steel Engineering Industries Association of South Africa (Seifsa) recently published a press release to place the minimum entry-level wage rate of R78 per hour (cost to company), currently applicable in the Steel Sector, in context.
 
Apart from the fact that Seifsa admits that these wage rates are too high, a couple of comments made in the press release bear some scrutiny.
 
The press release contains the following statements:
 
“It’s interesting to note that even if one had the freedom to pay National Minimum Wage or any other affordable rate, various cost to employment conditions contained in the BCEA, together with statutory levies and contributions, would still apply.”

“However, keep in mind that if one were not covered by the Main Agreement all the above items denoted by an asterix would still apply, approx. 30%”
 
There is agreement that a lot of the cost to company items are statutory requirements or requirements in terms of other agreements and that the cost to company should be viewed in context.
 
However, the context that has conveniently been omitted is that the approximately 30% that would in any event be payable, would be calculated on a much lower base rate, were it not for the Main Agreement.

Per illustration: 

• The National Minimum Wage is currently R23,19 per hour, plus 30% = R30,14.
• Main Agreement minimum wage is R55,67 per hour, plus 30% = R72,37.