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Should you add a transport allowance when fuel prices rise?

Reviewed July 2026 · Pay & wages

Yes, in most cases you should. Split what you pay into two parts: a basic wage that on its own meets the National Minimum Wage of R30.23 per ordinary hour, and a separate transport allowance on top of that. This matters because the law says you cannot count transport money when working out whether you meet the minimum wage. When fuel prices jump and taxi fares follow, a clear transport allowance keeps your worker whole and keeps you compliant.

Why fuel prices hit your worker's pay

Fuel prices move sharply. On 1 April 2026, petrol went up by about R3 per litre and diesel by more than R7 per litre. Most minibus taxis run on diesel, so the National Taxi Alliance warned that commuter fares would rise across South Africa.

This lands hard on domestic workers. The National Minimum Wage rose to R30.23 per ordinary hour on 1 March 2026, but a higher taxi fare can wipe out that increase before the worker gets home. Many domestic workers spend up to 40% of their monthly income just on getting to and from work.

Here is what that looks like in practice. A worker earning R30.23 per hour for an eight-hour day earns R241.84 for the day before anything is taken out. If their daily taxi fare is around R80 (for example, travelling from Orange Farm to Sandton), and that R80 is really coming out of the same money, their effective pay drops to roughly R20 per hour. That is below the legal minimum once transport is taken into account.

The rule: transport does not count towards the minimum wage

The basic cash wage has to stand on its own at or above R30.23 per hour. You cannot include transport payments when working out whether you meet the National Minimum Wage.

So if you pay one lump sum that is meant to cover both work and travel, and travel eats into it, your real wage can fall below the legal floor without you realising it. Keeping the transport allowance separate, and on top of the basic wage, is what keeps you on the right side of the law.

How much should a transport allowance be?

Base it on your worker's actual daily commute, not a guess. In the major metros, a daily transport allowance usually falls in the range of R20 to R50 per day, depending on distance and the local taxi routes they use.

The right number is the one that reflects what the trip actually costs. Ask, then set the allowance to match.

Three steps to get it right

1. Talk about the real cost. Ask your worker what their taxi route actually costs each day. Understand where they travel from and which routes they take, so the allowance reflects reality.

2. Make it clear on the payslip. Split the payslip into two lines: the basic wage (which must meet the R30.23 per hour minimum on its own) and a separate transport allowance. Benchmark the allowance against the R20 to R50 per day range for your area.

3. Plan for the next increase. A temporary fuel levy reduction runs from 1 April to 5 May 2026, and a further price spike is likely in June. Agreeing a transport allowance now means you are not scrambling to renegotiate every time the pumps move.

Why a separate allowance protects you both

Setting out a separate transport allowance protects both of you. Your worker keeps their full wage, your minimum-wage obligation stays clear and predictable, and you have a buffer ready for the next fuel price shock.

AskMandla can split each payslip into a basic wage and a separate transport allowance for you over WhatsApp, and keep the record clear for both sides, so there is never any doubt about what covers work and what covers travel.