The Employment Equity Act and Justified Discrimination
How do you differentiate between justified and unfair discrimination?
Based on fairness and rationality combined with the 7 factors listed in the Codes of Good Practice should be considered justified discrimination with reference to employee remuneration. Recently we discussed employment equity and the prohibition of unfair discrimination. Section 6(2)(b) of the Employment Equity Act, Act No. 55 of 1998, deals with what might be considered as “fair” discrimination.
In order to provide guidance on fair discrimination relating to remuneration, the Minister of Labour issued Codes of Good Practice with regard to equal pay/remuneration for equal work of equal value, the so-called “same work, same pay” principle, on 1 June 2015. The application of the codes is discussed below.
When evaluating an employer’s compliance with the “same work, same pay” principle, the codes refer to three key factors:
- Are the jobs that are being compared substantially the same or of equal value (in terms of an objective assessment)?
- Are there differences in the terms and conditions of employment (including remuneration/pay) of the employees who perform the relevant jobs?
- If the answer to the above question is yes, can these be justified on fair and rational grounds?
To determine the value of a job, an employer will usually look at the following when establishing “fair” grounds for discrimination:
- The responsibilities associated with the job
- The skills and qualifications required to perform a job, whether formal or informal
- Physical, mental and emotional effort needed to do the job
- Working conditions, including the physical environment, psychological conditions, time when work is performed or the geographical location where work is performed.
One of the factors listed as unfair discrimination in the Employment Equity Act is gender. Not surprisingly, the Codes of Good Practice also deal with the comparison and evaluation of male vs female dominated jobs. Any difference in pay based on gender will be considered unfair discrimination. To ascertain whether a particular job had been undervalued and to align female dominated jobs with comparable male dominated jobs, employers should be able to clearly establish the value of certain male and female dominated jobs. The mere fact that a certain industry or business does not have any comparable male vs female dominated jobs does not imply that gender-based discrimination is not present. It might simply indicate that the gender issue had not yet been addressed.
Justified discrimination relating to remuneration
Any differentiation based on fairness and rationality combined with the 7 factors listed in the Codes of Good Practice should be considered justified discrimination with reference to employee remuneration. As in the case of law, the merits of each matter should provide guidance on the process, but the 7 factors are commonly considered when determining an employee’s pay. The factors are:
- An employee’s seniority and years of service
- An employee’s qualifications, ability, competence and potential above the inherent qualifications of a specific job
- An employee’s performance, quality and quantity of work, verified as per a standard evaluation method
- Organisational restructuring and related demotion of employees
- The duration of an appointment. Fixed-term employees may be appointed on different terms of employment than their counterparts who are appointed on a permanent contract.
Employers that adhere to the Codes of Good Practice, with clear job descriptions and work policies, should be able to pass the test. Our legal team at SERR Synergy guide and assist businesses in a practical and supportive way with regard to the required processes and procedures to ensure labour legislation compliance and to minimise the risk to which the business is exposed when employing staff.
About our author: Audrey Cloete obtained her LLB degree from the North-West University Potchefstroom in 2003. She completed her articles with the main focus on Criminal Law and is also an admitted Conveyancer. Audrey joined SERR Synergy in 2015 where she currently works as a Legal Compliance Advisor.