South Africa’s earnings threshold will increase from 1 May 2026, affecting how key labour protections apply to employees across the country.
The Minister of Employment and Labour has set the earnings threshold under the Basic Conditions of Employment Act (BCEA) at R269 600.90 a year, up from R261 748.45 – an increase of R7 852.45.
The adjustment continues the upward trend seen in recent years. The 2026 increase is slightly higher than the previous year’s adjustment, which was about R7 376.78.
The earnings threshold remains an important dividing line in South African labour law. Even small adjustments can shift employees into or out of the scope of key protections, making it essential for employers to stay up to date and ensure their practices remain compliant.
Why the earnings threshold matters
The earnings threshold plays a central role in determining which employees qualify for certain protections under South Africa’s labour laws.
As both CDH and Bowmans explain, employees earning below the threshold benefit from a range of additional protections, while those earning above it are excluded from some of these provisions.
Under the BCEA, employees below the threshold are entitled to protections relating to:
- working hours and overtime;
- meal intervals and rest periods; and
- pay for Sundays, public holidays, and night work.
Employees earning above the threshold are excluded from these provisions.
The threshold also affects the application of the Labour Relations Act (LRA). As CDH notes, employees earning above the threshold are not covered by certain deeming provisions, including those that may treat workers placed by labour brokers as employees of the client.
Similarly, protections for fixed-term employees may not apply to higher earners, meaning they are less likely to be deemed permanent after three months without justification.
Under the Employment Equity Act (EEA), the threshold determines how disputes are handled. Bowmans explains that employees earning at or below the threshold may refer unfair discrimination disputes to the CCMA for arbitration, while those earning above it generally need to approach the Labour Court.
How earnings are calculated
For purposes of the threshold, “earnings” refers to an employee’s regular annual remuneration before deductions such as tax or benefit contributions.
However, certain payments are excluded. As CDH explains, subsistence and transport allowances, overtime payments, and achievement awards are not counted when determining whether an employee falls above or below the threshold.
What employers should do
Bowmans advises that employers should take practical steps ahead of the 1 May implementation date. These include reviewing employee earnings across the workforce, reassessing fixed-term contracts, and revisiting labour broking arrangements to ensure compliance with the law.
A proactive review, the firm notes, will help employers to avoid unintended consequences and reduce compliance risks.
