Employment Equity is often questioned as an “is it really necessary” factor in businesses, and the short and simple answer is yes, it’s law…

The Employment Equity Act aims to remove unfair discrimination, ensure fair treatment of all employees, encourage equal and unbiased opportunities, promote development, and allow for just representation of all occupational levels within the workplace.

The Employment Equity Act of 1998 was very clear that designated employers’ failure to comply may result in hefty fines for companies. In alignment with compliance, the deadline for annual EE report submissions for 2022, stated by The Department of Employment and Labour, was set for 15 January 2023, no later than midnight. Although, submissions for 2023 are expected to look a lot different.

Amendment Bill

On 17 May 2022, The Employment Equity Amendment Bill 2020 was passed by Parliament, awaiting assent and signing by President Ramaphosa and the new laws are set to come into operation effective 01 September 2023.

The amendments look into empowering the Minister of Employment and Labour to regulate sector-specific EE targets and compliance criteria to issue Compliance Certificates as per Section 53 of the Employment Equity Act.

Designated Employers

Other changes to be expected will be concerning employers that are defined as “designated employers”. Currently, designated employers are defined as those that employ 50 or more employees or less than 50 employees but have an annual turnover equal to or above the relevant sector threshold.

This definition is set to change, and the new definition of a “designated employer” will be defined only as employers that employ 50 or more employees. Those companies that do not, irrespective of their annual turnover, will no longer be required to comply with the EE requirements. This goes hand in hand with the changes in regulating sectoral targets and compliance criteria.

We do not know yet what to expect in the targets that will be set out for the different sectors for 2023, but labour practitioners and designated employers that fall into the new scope are advised to be on the lookout for these changes and implement them in a manner that flows hand in hand with compliance.

These can be monitored at https://www.globalbusiness.co.za/ee-sectoral-targets/

New tools

To aid in the successful implementation of these amendments, acting deputy director-general of Labour Policy and Industrial Relations, Mr Thembinkosi Mkalipi, has advised that there would be a new online assessment system that is likely to be created for employers to monitor the sectoral targets and to report their planned targets, the said assessments would be revised on an annual basis.

 “The system will accept, in good faith, all the information supplied, and the Department, through the inspectorate, visit workplaces to verify if the information submitted is genuine”. 

Should employers’ information and/or be found falsified, they will have their Compliance Certificate withdrawn and face severe penalties.

With all these changes to be implemented, we wait in anticipation of 2024 to see if the system will allow for accurate feedback on whether employers met their target plans.

For any assistance relating to Employment Equity, please do not hesitate to contact Invictus Group