Suran Moodley, Group Managing Executive at Ariston Global
The subject of executive remuneration remains both contentious and emotive, but a newly proposed bill may have unintended consequences that business owners should be considering.
In June 2025, the South African Parliament was presented with the proposed Fair Pay Bill by the Build One South Africa (BOSA) party, proposing a major change in how remuneration is governed and communicated across the economy.
The Bill is designed to create greater pay transparency by requiring employers to disclose salary bands in job adverts, prohibiting salary history questions during recruitment, and making it easier for employees to compare pay across roles. It represents a shift towards accountability and equity in the workplace, but one that demands careful implementation if it is to achieve its purpose without causing unintended harm.
The intention of the Fair Pay Bill is commendable. It aims to address South Africa’s persistent wage inequality, where the gap between the highest and lowest earners remains among the widest globally. By encouraging open discussion about pay, the Bill seeks to ensure that people are rewarded based on their role, skills and experience rather than on historic bias or negotiation power. In principle, transparency fosters trust and equality. Yet, in a country grappling with deep inequality, high unemployment and elevated security risks, transparency could also create new complexities for both employers and employees.
The Bill sets out several key reforms. Employers will no longer be permitted to ask candidates about their previous salaries, a practice that has been shown to perpetuate pay disparities between men and women, and between historically advantaged and disadvantaged groups. All job advertisements, including those for internal transfers or promotions, will need to specify a salary range rather than using vague descriptions such as “market related”. Employees will be granted the right to discuss their pay openly, and confidentiality clauses preventing such discussions will be prohibited. Employers must also keep written records explaining their pay frameworks, job grading and rationale for remuneration decisions. These provisions will make it easier for workers, unions and regulators to identify unjustifiable gaps within organisations.
The proposed Bill follows broader reforms already introduced under the Companies Amendment Act 16 of 2024, which compels listed and state-owned companies to disclose executive pay ratios, remuneration policies and pay-gap data in their annual reports. What is different now is that the Fair Pay Bill extends the principle of transparency beyond large corporations to include private companies and smaller enterprises. This means that pay visibility will no longer be confined to the boardroom but will reach into the operational layers of every business. In practice, this will require new systems, processes and communication strategies across organisations of all sizes.
One of the important proposed changes is that data sent to CIPC will no longer be anonymised by the Director or Executive, but will include names and associated remuneration.
This also has broader societal and security considerations. In a country where violent and economic crimes are prevalent, publishing detailed remuneration data could expose executives to additional risk. Between April 2023 and March 2024, the South African Police Service recorded 17 061 kidnappings, underscoring how visibility of wealth can create tangible personal-security risk in South Africa. Making executive and director pay easily accessible through company registers, while well-intentioned, may require new safeguards to protect individuals. Another challenge is the potential for internal tension. When employees can easily see what others earn, especially across wide pay gaps, transparency without context can breed resentment. A junior bookkeeper earning R15,000 a month may struggle to understand why a financial manager earns R45,000 unless pay frameworks are clearly communicated and justified. Fairness is not just about disclosure; it is about explanation. Employers will need to invest in education, dialogue and trust-building to ensure that transparency leads to understanding rather than division.
The business community is also concerned about flexibility. Publishing salary bands could limit the ability to tailor offers based on experience or performance, particularly in industries where skills shortages require competitive bidding for talent. For smaller businesses that rely on flexible arrangements, fixed pay bands could make hiring more rigid. These are not reasons to oppose transparency, but they highlight the need for proportional implementation and guidance for businesses at different stages of maturity.
For progressive companies, the Fair Pay Bill represents an opportunity to take the lead on equitable pay practices before the law compels them to. Conducting pay audits, benchmarking salaries, defining clear job-grading systems and communicating pay philosophy internally can all help to build credibility and resilience. Reviewing recruitment practices, removing salary-history questions and aligning job adverts with defined pay ranges will position companies ahead of the regulatory curve. Updating reward structures to balance salary, performance bonuses, equity participation, and dividends will also become increasingly important as businesses adapt to changing expectations around fairness.
While the Fair Pay Bill has its merits, it is important that we don’t discourage entrepreneurs from investing their risk capital and enjoying the fruits of their labour when they succeed.
ENDS
