MRL3702
ASSIGNMENT 2 SEMESTER 1 2025
UNIQUE NO.
DUE DATE: APRIL 2025
, Legal Opinion on Quantum Foods (Pty) Ltd v Commissioner H Jacobs N.O. and
Others (JA85/2022) [2023] ZALAC 27; [2024] 1 BLLR 32 (LAC); (2024) 45 ILJ 71
(LAC) (18 October 2023)
Summary of the Facts
Quantum Foods (Pty) Ltd ("Quantum Foods") sought to comply with the National
Minimum Wage Act 9 of 2018 ("the Act") by restructuring its employees' remuneration.
This restructuring involved including a contractual bonus and the employer's
contributions to a provident fund in the calculation of employees' wages. The contractual
bonus was guaranteed and could be received either annually or in monthly installments,
at the employee's election. The General Workers Union of South Africa, representing
the employees, contested this approach, arguing that such payments should be
excluded from minimum wage calculations under Section 5 of the Act.
Issues in Dispute
The primary issues before the court were:
1. Whether the contractual bonus paid by Quantum Foods could be included in the
calculation of the national minimum wage under the Act.
2. Whether the employer's contributions to the provident fund should be factored
into the employees' wages for the purposes of meeting the minimum wage
requirements.
The Court’s Decision
The Labour Appeal Court (LAC) held that:
1. Contractual Bonuses: The court distinguished between gratuitous bonuses,
which are discretionary and not enforceable, and contractual bonuses, which are
obligatory and form part of the agreed remuneration package. The LAC
ASSIGNMENT 2 SEMESTER 1 2025
UNIQUE NO.
DUE DATE: APRIL 2025
, Legal Opinion on Quantum Foods (Pty) Ltd v Commissioner H Jacobs N.O. and
Others (JA85/2022) [2023] ZALAC 27; [2024] 1 BLLR 32 (LAC); (2024) 45 ILJ 71
(LAC) (18 October 2023)
Summary of the Facts
Quantum Foods (Pty) Ltd ("Quantum Foods") sought to comply with the National
Minimum Wage Act 9 of 2018 ("the Act") by restructuring its employees' remuneration.
This restructuring involved including a contractual bonus and the employer's
contributions to a provident fund in the calculation of employees' wages. The contractual
bonus was guaranteed and could be received either annually or in monthly installments,
at the employee's election. The General Workers Union of South Africa, representing
the employees, contested this approach, arguing that such payments should be
excluded from minimum wage calculations under Section 5 of the Act.
Issues in Dispute
The primary issues before the court were:
1. Whether the contractual bonus paid by Quantum Foods could be included in the
calculation of the national minimum wage under the Act.
2. Whether the employer's contributions to the provident fund should be factored
into the employees' wages for the purposes of meeting the minimum wage
requirements.
The Court’s Decision
The Labour Appeal Court (LAC) held that:
1. Contractual Bonuses: The court distinguished between gratuitous bonuses,
which are discretionary and not enforceable, and contractual bonuses, which are
obligatory and form part of the agreed remuneration package. The LAC
