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Speeding up Employment Equity in the workplace by Gideon Gerber

The Employment Equity Act is applicable to all designated employers (employers who employ more than 50 people or have an annual turnover equal to or in excess of a specific industry or sector threshold).

The aim of the Employment Equity Act is to facilitate workplace transformation by incorporating two fundamental elements: a) the elimination of unfair discrimination and b) the implementation of affirmative action and measures to enable equitable representation of employees from diverse racial, disability and gender groups in the workplace.

The Employment Equity Act has been in effect since 1998 and is applicable to all designated employers (employers who employ more than 50 people or have an annual turnover equal to or in excess of a specific industry or sector threshold). These designated employers must develop and implement an employment equity plan effective for one to five years to address inequalities in employment, eliminate unfair discrimination and uphold the right to equality.

What is the Commission for Employment Equity?

The Commission for Employment Equity (CEE) is a statutory body established to advise the Minister of Labour on specific matters concerning the Employment Equity Act (EEA), including policy recommendations and matters relating to the implementation thereof to achieve the objectives of the EEA.

What is the Commission for Employment Equity Annual Report?

The CEE is required to submit an annual report to the Minister of Labour to evaluate and monitor progress towards achieving the objectives of the EEA and the targets set in the employer’s own Employment Equity Plan.

Highlights of the 18th Annual CEE Report

Last month the CEE released its 18th Annual Report and the so-called Public Register to the Minister of Labour, Mildred Oliphant. Indications are that some progress has been made with transformation in the workplace:

  • The annual CEE Report revealed that white men still dominate senior management levels, with their representation being far above their share of the economically active population (EAP). Black representation at these levels has increased by 1% year on year since 2001.
  • Although moderate, there have been pockets of improvement in representivity in both the public and private sectors. There is a more balanced representation in terms of demographic representivity in the public sector and progress is being made towards accomplishing equitable levels for women. Disability representation in both the private and private sectors remains a matter of concern.
  • Since introducing the principle of equal pay for work of equal value, it has become much easier for vulnerable groups to report instances of unfair discrimination and pay disparities in the workplace. It is also very encouraging to see that the Labour Court and CCMA have played their part in ensuring that these cases receive the attention they deserve.

Proposed amendments to the Employment Equity Act

The proposed amendments to the Employment Equity Act are envisaged to accelerate transformation in the workplace through enhanced inspection and enforcement. Below is a brief synopsis of the proposed amendments:

  • One of the proposed amendments is in the form of incentives to businesses that meet their employment equity obligations by supporting those companies to do business with the government. The Department of Labour is strengthening its efforts to root out those JSE-listed companies that disregard the EEA. More than 50% of the 192 companies are listed on the JSE and have been referred for prosecution for failing to comply with the act. These businesses might be facing even more severe consequences for non-compliance in future. Labour Minister Mildred Oliphant also warned that the department would use section 53 of the EEA to prevent non-compliant companies from doing business with the state. Section 53 requires entities to submit a certificate issued by the Department of Labour when applying or bidding for government tenders.
  • Another proposed amendment relates to the definition of designated employers. It is proposed that the turnover threshold be scrapped but not the number of employees.
  • Another amendment will see different industries setting transformation targets to replace the system of self-determined targets. In the past there was an expectation that companies would set themselves higher targets to improve their employment equity, but in many cases there were no progress.

Of significance is whether these envisaged amendments to the EEA meet the requirements set in the Constitution of South Africa. The Constitutional Court has already ruled that the use of quotas is prohibited by the EEA.

It is important to note that the proposed amendments to the EEA have already been approved by the National Economic Development and Labour Council (NEDLAC) and will soon be released for public comment. All indications are that the submission of Certificates of Employment Equity compliance will become compulsory and peremptory for all government tenders by October 2018.

SERR Synergy assists businesses with the development and implementation of Employment Equity Plans and submission of the required reports. We guide businesses through the process to ensure that equity in your organisation meets the requirements of the Employment Equity Act and supports the growth and success of your business. 

About the author: Gideon Gerber is one of the founding directors of SERR Synergy and an admitted High Court attorney with more than 30 years’ experience in Business Structuring & Compliance, Training, Skills Development and Business Compliance in South Africa, the UK and Namibia. He obtained his Master’s Degree in Law from the University of Pretoria with a research dissertation on B-BBEE Fronting. Gideon is a regular speaker at various B-BBEE seminars and writes articles for the Business Day and Landbouweekblad that concerns B-BBEE Matters.