A debate on the national minimum wage was hosted by the Gauteng chapter of the South African Society for Labour Law (SASLAW) and the Department of Mercantile Law on the Hatfield Campus of the University of Pretoria (UP) on Tuesday, 10 May 2016. 

The debaters were Mr Leon Louw, Executive Director of the Free Market Foundation (FMF), and Mr Gilaad Isaacs, coordinator of the National Minimum Wage Research Initiative at the Corporate Strategy and Industrial Development (CSID) organisation in the School of Economic and Business Sciences at the University of the Witwatersrand. Mr Shawn Christiansen, Senior Commissioner from the Commission for Conciliation Mediation and Arbitration (CCMA), chaired the proceedings and Prof Monray Botha, from the Department of Mercantile Law at UP, gave the opening address.

Mr Christiansen opened the debate by posing the question under review: Can South Africa in its current situation survive a national minimum wage (NMW)?

Mr Louw, was the first debater, on the podium and stated categorically that South Africa already had a national minimum wage, which was zero, as around eight to nine million people in the country are unemployed. He based his presentation on what he calls a '3H' model: heart, head, and hard data. He explained this as follows: The nine million unemployed South Africans are not just a number, each one is a human being. Persons with disabilities and many of the youth struggle to find work, and imposing a national minimum wage would make it even more difficult for them. The logical deduction is that a national minimum wage would raise salaries and wages, resulting in turn in an increase in the price of goods and services, which would not encourage consumers to buy. The result will be a downturn in our economy and employers hiring fewer people owing to the higher cost of labour. Thus, unemployment would rise as a result of a national minimum wage.

Mr Isaacs countered that, if the increase were moderate, the national minimum wage would improve rather than harm the economy as it would give workers necessary social protection and reduce inequality. He presented economic statistics that showed that a national minimum wage could spur economic growth, and could do so with little or no negative impact on employment. He pointed out that South Africa has one of the largest gaps between its highest and lowest earners.

Professor Stefan van Eck, from the Department of Mercantile Law, says the debate was a great success. Attorneys and commissioners from the CCMA engaged in the discussion. Prof Van Eck says that it is imperative that stakeholders get involved in the national discourse about this very important social issue and that, in his view, the answer does not lie in either of the main speakers' point of view. As important as it is to foster entrepreneurship and the establishment of start-up businesses, it is just as important that the gap between the rich and the poor should not widen to unacceptable proportions. The responsibility for advancing this two-pronged approach does not lie solely with the state, but also with organised business and labour.