MAJOR SALARY CHANGES PROPOSED FOR SOUTH AFRICA
- BEE NEWS
- Jul 25
- 4 min read
Malcolm Libera | 24 July 2025
The newly proposed Fair Pay Bill could change recruitment practices and salary transparency across the country, with significant implications for employers and employees.
This is according to legal experts at Cliffe Dekker Hofmeyr (CDH), Yvonne Mkefa, Director of Employment Law, and associates Sashin Naidoo and Thato Makoaba.
The Fair Pay Bill was tabled before the National Assembly in June 2025. It aims to amend the Employment Equity Act of 1998 by prohibiting employers from using a candidate’s past salary history during recruitment processes.
It would also make it mandatory for employers to disclose either a fixed salary or a salary range when advertising a job, classifying or grading positions, or appointing or transferring staff.
According to the legal experts, the legislation is designed to foster fairness, reduce inequality, and promote transparency in the South African labour market.
“The aim of the bill is to promote remuneration transparency to help address the pay gap, gender pay disparities, and the issues linked to South Africa’s Gini coefficient status,” said CDH.
“It aligns with global trends in pay transparency and encourages responsible business practices.”
One of the Bill’s main provisions is the prohibition against asking for an applicant’s previous salary during recruitment, unless two conditions are met.
These conditions are that the employer has already made a job offer, and the candidate voluntarily requests in writing that their previous remuneration be considered.
Additionally, employers will be expected to establish and share the salary or salary range for each role up front. Candidates can only discuss pay within the stated range.
Another major shift proposed by the bill is the removal of confidentiality clauses that prevent employees from discussing their pay with others.
While the right to do so already exists under the Basic Conditions of Employment Act, the bill goes a step further by explicitly outlawing such confidentiality clauses.
This ensures employees can freely share their current and past remuneration with colleagues. CDH also said these changes could deliver a host of benefits.
“Transparent compensation and upfront remuneration information can attract genuinely interested and qualified candidates, reducing wasted resources on mismatched applications,” the experts said.
“It may also help employers mitigate their exposure to claims of unfair labour practices and discrimination, which can be costly and damaging to their reputation.”
“Transparent pay practices can enhance employee engagement and retention by fostering trust in management decisions,” they added.
The bill’s challenges and next steps
The law firm acknowledged that the bill is not without challenges. CDH cautioned that assessing and determining value for jobs where there are no historical remuneration benchmarks available may be difficult.
This is especially relevant in industries with informal or evolving pay structures, such as freelance-heavy sectors or jobs in emerging specialisations.
Small, medium, and micro enterprises (SMMEs) could also struggle with compliance due to limited financial and administrative resources.
“To address these challenges, the bill must make provision to cushion or protect small employers and industries with atypical workforces,” CDH advised.
Another possible side effect is that competitors will be able to see each other’s salary ranges, potentially impacting market competition.
However, CDH pointed out that the bill allows employers to advertise broad salary bands, and does not set strict calculation guidelines, offering some flexibility.
For employees, the bill would represent a substantial gain in bargaining power. Job seekers would no longer be held to their previous earnings unless they choose to disclose them.
Additionally, they would have clearer insight into the pay on offer before applying for a role. “Employees gain the explicit right to discuss remuneration openly with others,” CDH noted.
With the bill now tabled in the National Assembly, it will undergo several steps before it can be passed into law.
First, Parliament’s legal advisors will review the bill to ensure it complies with legislative standards and is properly categorised. It will then be published in the Government Gazette for public comment.
The Portfolio Committee on Employment and Labour will conduct in-depth scrutiny and debate, after which it will be formally introduced in the National Assembly for further deliberation, potential amendment, and voting.
Should it be enacted, employers will face a range of compliance responsibilities. “Employers will need to update their recruitment and pay practices, revise application forms and interview protocols, and adapt internal policies around salary setting,” CDH warned.
Training for HR teams and management will also be needed to ensure organisations understand and comply with the new rules.
CDH recommended that businesses make use of compensation planning tools and benchmarking software to access accurate, up-to-date market salary data.
This will help employers move away from reliance on salary histories and make informed, equitable pay decisions.
“Employers should conduct audits to assess remuneration structures and identify any unjustifiable pay gaps—comparing pay across roles, races, genders, backgrounds, and addressing unconscious biases,” the CDH experts said.
“They should also keep records of valid reasons for differences in pay, such as a person’s skills, tenure, qualifications, experience, or performance.”
‘Disclaimer - The views and opinions expressed in this article are those of the author(s) and not necessarily those of the BEE CHAMBER’.