Business Unity South Africa (Busa) on Friday welcomed the endorsement of the national minimum wage by the Congress of South African Trade Unions (Cosatu), saying that this marked the final endorsement of a labour relations stability.

“We are pleased with Cosatu’s endorsement of the agreement. The agreement heralds a new era for labour relations in South Africa. With the backing of all social partners in NEDLAC, this agreement moves our labour market in the right direction,” Busa chief executive, Tanya Cohen, said.

“Cosatu’s announcement has reaffirmed the commitment by social partners to fair labour practices and the important role of the private sector, as well as that of the State in creating the necessary conditions to drive productivity led, inclusive growth and employment.”

This comes after Cosatu’s Central Executive Committee announced on Thursday that affiliated unions have accepted the proposed National Minimun Wage of 20 per hour, or R3 500 per month, and that the federation was ready to sign on the dotted line.

But Cosatu said it would initiate a campaign for its own minimum wage of R4 500 per month.

The proposed national minimum wage is expected to come into effect on 1 May 2018.

The national minimum wage would be introduced with the option of exemptions based on affordability and would be phased in for the first year, with domestic workers at 75 percent and agricultural workers at 90 percent.

Busa chief executive Cohen said the national minimum wage is an important step in the right direction towards a living wage, and sends a message that all the social partners, including business, are committed to creating a fair, inclusive and progressive economy.

“The agreement has been welcomed by the market and ratings agencies, as it addresses one of their key concerns, being labour market stability,” Cohen said.

The Busa chief executive said the agreement on national minimum wage recognised that employees should be paid a fair minimum wage for productive work; that strikes should be peaceful and functional; that all stakeholders have a leadership role to play in bringing stability to the labour market and that productive employment is essential for inclusive growth.

Jabu Mabuza, the Busa president, also welcomed the agreement, saying: “The agreement demonstrates commitment by all the social partners in NEDLAC to transform the South African economy in a meaningful way that contributes to inclusive growth in the country.

“We congratulate Team SA on a job well done – as business we are committed to supporting and implementing the agreement.”