The South African Minister of Employment and Labour has announced an increase in the annual earnings threshold, effective 1 May 2026.
The new threshold is set at R269 600.90 per year (R22 466.74 per month), representing an increase of R7 852.45 – or 3% – from the previous threshold of R261 748.45 that has been in place since 1 April 2025.
At Welman Attorneys Inc, our specialist labour law team advises employers and employees across South Africa on how legislative changes such as this one affect their rights and obligations. Here is what you need to know.
What Is the Earnings Threshold?
The earnings threshold is a monetary benchmark, determined periodically by the Minister of Employment and Labour under the Basic Conditions of Employment Act 75 of 1997 (“BCEA”).
Employees who earn above this threshold are excluded from the protection of certain key provisions of the BCEA, the Labour Relations Act 66 of 1995 (“LRA”) and the Employment Equity Act 55 of 1998 (“EEA”).
For purposes of the threshold, “earnings” means an employee’s regular annual remuneration before the deduction of income tax, pension fund contributions, medical aid contributions and similar payments. Importantly, subsistence and transport allowances, achievement awards and overtime payments are excluded from the calculation.
Which Employees Are Newly Protected?
Employees who currently earn between R261 748.45 and R269 600.90 per year will, from 1 May 2026, be entitled to the full suite of protections previously unavailable to them.
This includes the right to overtime pay, double pay for work on Sundays and public holidays, regulated meal intervals and rest periods, notwithstanding what their employment contracts may state.
Key Protections Under the BCEA
Employees who earn at or below the threshold are entitled to the protection of the following BCEA provisions:
- Regulation of ordinary hours of work (section 9)
- Overtime pay (section 10)
- Compressed working week arrangements (section 11)
- Averaging of hours of work (section 12)
- Meal intervals (section 14)
- Daily and weekly rest periods (section 15)
- Additional pay for Sunday work (section 16)
- Pay for night work (section 17(2))
- Pay for public holidays on which the employee would not ordinarily work (section 18(3))
Implications Under the LRA and EEA
The threshold also has important implications beyond the BCEA. Under the LRA, employees earning below the threshold who are placed by a temporary employment service (“TES”) for more than three months may be deemed permanent employees of the client.
Similarly, fixed-term employees earning below the threshold may be deemed indefinitely employed after three months if there is no justifiable reason for the fixed term. These protections do not extend to those earning above the threshold.
Under the EEA, an employee earning above the threshold who has an unfair discrimination dispute (other than one involving sexual harassment) must refer that dispute to the Labour Court for adjudication, rather than to the CCMA for arbitration.
Can Existing Contracts Be Changed?
An important practical point: where an employee earns above the threshold but their employment contract already provides for overtime pay, Sunday pay or other benefits regulated by the BCEA, those contractual provisions remain valid and enforceable.
An employer cannot unilaterally remove them. Any change to existing terms and conditions of employment must be negotiated with the affected employees.
How Welman Attorneys Inc Can Help
At Welman Attorneys Inc, we understand that changes to the earnings threshold can have significant practical consequences for your business or your employment. Our labour law team assists clients with:
- Reviewing and updating employment contracts to ensure compliance with the new threshold
- Advising employers on their payroll obligations and exposure to claims
- Representing employees who are now newly entitled to BCEA protections
- Navigating CCMA proceedings or Labour Court referrals arising from disputes
- Advising on the correct classification of TES workers and fixed-term employees
Whether you are an employer seeking to ensure compliance or an employee whose rights have changed, contact Welman Attorneys Inc for expert, practical advice tailored to your circumstances.