From 1 May 2026, the earnings threshold under the Basic Conditions of Employment Act (BCEA) increases to R269,600.90 per year (or R22,466.74 per month).
For employers, this is more than just an updated figure — it directly determines which employees automatically qualify for certain key protections in terms of the BCEA.
To view the determination in the Gazette, click here.
Why this matters
Employees earning below the threshold are entitled to specific statutory protections. Those earning above it are generally excluded from these provisions, unless their employment contracts or collective agreements say otherwise.
In other words, this threshold plays a critical role in shaping employees’ working conditions and your compliance obligations.
What is meant by “earnings”?
When determining whether an employee falls above or below the threshold, “earnings” refers to their regular annual remuneration before deductions (such as PAYE, pension, and medical aid).
However, it’s important to note what is excluded:
- Employer contributions (e.g. pension or medical aid)
- Subsistence and travel allowances
- Performance or achievement bonuses
- Overtime payments
This is where employers often get it wrong — simply looking at gross salary is not enough. You need to assess what is included and excluded to make an accurate determination.
BCEA provisions affected
The threshold impacts whether the following sections apply to an employee:
- Ordinary working hours
- Overtime
- Compressed work weeks
- Averaging of working hours
- Meal intervals
- Daily and weekly rest periods
- Sunday work pay
- Night work
- Public holiday pay
- Certain provisions relating to fixed-term and part-time employees
Employees above the threshold are not automatically covered by these, unless contractually agreed.
What this means for employers
This increase may result in higher labour costs, particularly where more employees now fall below the threshold and become entitled to additional statutory benefits.
It also creates a good opportunity to:
- Revisit salary structures
- Review employment contracts
- Reassess working hours and overtime arrangements
Important pitfalls to avoid
- Employees who move above the threshold do not lose all protections — only specific BCEA provisions no longer apply automatically.
- You cannot change employment terms unilaterally. Any amendments to benefits like overtime or working hours must be done through proper consultation and agreement.
Practical next steps
To stay compliant, employers should:
- Identify which employees now fall above or below the new threshold
- Review and update employment contracts where necessary
- Re-evaluate remuneration and working arrangements
Final thought
The 2026 threshold increase is not just about overtime — it affects multiple aspects of employment, including working hours, pay structures, and compliance risk.
Taking a proactive approach now can help you avoid disputes, ensure compliance, and manage costs effectively.
For questions or advise, please contact the Cofesa national helpline:
(t): 011 679 4373
(c): 082 888 9516
(e): helpline@cofesa.co.za
Disclaimer: The information and material published on this website is provided for general purposes only and does not constitute legal advice. We make every effort to ensure that the content is updated regularly and to offer the most current and accurate information. Readers are advised to always consult with a Labour Law Practitioner before acting on the information. We accept no responsibility for any loss or damage, whether direct or consequential, which may arise from reliance on the information contained in these pages.