COMMISSION STRUCTURES IN THE HAIRDRESSING, COSMETOLOGY, BEAUTY & SKINCARE INDUSTRY

The payment of commission remains a cornerstone of the hairdressing, cosmetology, beauty and skincare industry. Commission-based structures not only incentivise employees but also ensure that employers align pay with productivity and service delivery. The Main Collective Agreement provides clear guidelines on how commissions and wages must be structured and paid to employees within the industry.

Basic Salary and Wages

According to Clause 19.1, every employer is required to pay employees a Basic Salary or Wages not less than the applicable prescribed rates set forth in Annexure H, as amended from time to time.

This provision ensures that employees in the industry are guaranteed a foundational level of pay, protecting them from underpayment. However, where employees work on a commission-only basis, additional protections apply through the National Minimum Wage Act (NMWA).

Commission and the National Minimum Wage

Where employees are paid commission without receiving a basic salary or wage, employers are obliged to ensure compliance with the NMWA:

• Clause 31.2.1: Commission must include at least the equivalent of the National Minimum Wage.

• Clause 31.2.2: If commission payable falls below the National Minimum Wage threshold, the employer must top up the employee's pay to meet at least the National Minimum Wage.

• Clause 31.3: Retail commission payable to an employee will also be taken into consideration when calculating compliance with the National Minimum Wage requirement.

This guarantees that employees who earn only on commission are never paid less than the national legal minimum.

Commission Agreements

Employers who pay commission must ensure that clear, written agreements are in place:

• Clause 31.1: A written agreement between employer and employee must set out the terms, conditions, and structure of commission payments.

• Clause 31.2: Employers must provide the Council with a copy of such an agreement within seven (7) days upon request.

This ensures accountability, transparency, and protection for both employer and employee.

Regional Commission Structures

Commission percentages vary depending on the area of employment:

• Clause 31.6.1: 30% commission in respect of North-West, Free State, all Magisterial Districts of the Eastern Cape Province, and Kimberley.

• Clause 31.6.2: 40% commission in respect of the balance of Area A.

• Clause 31.1: Afro Salon Stylists must be paid a commission of not less than 30% of turnover for Area B.

Turnover may not be reduced by more than 5% for stock deductions.

For Area C and Area D, commissions are regulated under a floor agreement. This means that the specific minimum commission structures and conditions are negotiated locally rather than being set uniformly under the collective agreement.

The commission and wage framework in the hairdressing, cosmetology, beauty and skincare industry balances productivity incentives with employee protection. Whether an employee is earning a basic wage, commission, or a combination of both, the law ensures that no one earns less than the prescribed minimum wage or the National Minimum Wage Act threshold.

Regional variations, such as the floor agreements in Area C and D, highlight the importance of understanding localised terms, whilst special rules for Afro salons ensure inclusivity across all sectors of the industry.

Employers and employees alike should familiarise themselves with these provisions to ensure compliance, fairness, and sustainability within the industry.