Hello entrepreneurs and business owners, we have some important news regarding salary relativity adjustments. The long-awaited “Remuneration Regulations” were officially gazetted on Friday, September 13, 2024, as described in the Highlights of Cabinet Meeting on Friday 13 September 2024. Let’s explore what these changes mean for you and your valued employees.

" Cabinet has agreed to 32 Remuneration Regulations being amended, to provide for employers to pay arrears for wage relativity adjustment, for the months of July and August 2024, not later than December 2024."

What’s Changed?

The recent salary relativity adjustment, which came into effect on July 1st, 2024, is set to make a noticeable difference in the salary scales of the public and private sectors. Here’s what you need to know:

1. Implementation Timeline: The new regulations take effect from September 13, 2024, but are retroactive to July 1, 2024.
2. Payment Schedule: Employers must adjust salaries in the September 2024 payroll. Arrears for July and August must be paid by December 31, 2024.
3. Salary Range Affected: Employees earning between Rs 20,000 and Rs 50,000 will receive a salary adjustment of Rs 2,925.

Key Points for Employers

• Immediate Action Required: You need to implement these changes in your September payroll.
• Retroactive Payments: Plan for retroactive payments covering July and August.
• Collective Agreements: If you have existing collective agreements that provide equal or higher increases, you may not need to make additional adjustments.

Sector-Specific Changes

The new salary relativity adjustment regulations cover various sectors. Here are a few examples:

• Transport Sector: Traffic supervisors will now earn between Rs 24,535 and Rs 26,110 monthly, depending on years of service.
• Pre-Primary Education: Grade 1 teachers will earn between Rs 17,671 and Rs 18,744, based on experience.
• Factory Workers: Chief clerks will earn Rs 19,940 after one year of experience

Financial Assistance Schemes for SMEs

The Mauritius Revenue Authority (MRA) has rolled out some support measures to help businesses like yours cope with the wage relativity adjustments. For a more in-depth look at these support measures, be sure to check out our comprehensive article: MRA Financial Support to Employers: Wage Relativity Adjustment in Mauritius.

Here is a quick summary of what you need to know:

Eligibility Criteria

To qualify for this financial assistance, your business must meet the following criteria:

1. Be classified as a Small or Medium Enterprise (SME)
2. Have an annual turnover not exceeding Rs 100 million for the year of assessment 2022-2023

Amount of Financial Assistance

Eligible SMEs can receive financial support ranging from Rs 500 to Rs 2,000 monthly for each full-time employee drawing the national minimum wage. The exact amount depends on your business’s specific situation and financial condition.

Duration of Support

This financial assistance is structured to provide support from January 2024 to December 2024. That’s a full year of help to ease the transition!

Application Process

To benefit from this financial assistance:

1. Submit a one-time application through the MRA website
2. Use your Employer Registration Number (ERN) as the user ID
3. Use the password to log in.

Additional Support Measures

But wait, there’s more! The government has introduced other measures to support businesses:

1. Manufacturing Enterprises: If your annual turnover is between Rs 100 million and Rs 500 million, you might be eligible for additional support.
2. Export-Oriented Enterprises (EOEs): You could qualify for a full 100% refund for full-time employees earning a basic salary below Rs 20,000 as of January 2024.
3. Companies Facing Financial Difficulties: You may be eligible for 100% or 50% reimbursement, depending on your situation.

What This Means for Your Business?

These support measures are designed to help you navigate the challenges posed by the salary relativity adjustment without compromising your business’s financial health. By taking advantage of these schemes, you can:

1. Maintain your workforce without excessive financial strain
2. Invest in other areas of your business
3. Stay competitive in the market

What You Need to Do Now?

1. Review Your Payroll: Adjust salaries according to the new regulations.
2. Plan for Arrears: Set aside funds to cover retroactive payments.
3. Apply for Support: If eligible, submit your application through the MRA portal.
4. Communicate: Inform your employees about these changes and what they can expect.

Looking Ahead

These changes aim to create a fairer work environment and address wage disparities. While they present challenges, especially for SMEs, they also offer an opportunity to boost employee morale and productivity.
Remember, adapting to these changes smoothly can strengthen your relationship with your team and position your business as a fair and compliant employer.

Stay tuned for more updates, and don’t hesitate to seek professional advice for your specific situation.