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The Nuts and Bolts of the Employment Equity Amendment Bill

By • Johnny Goldberg | CEO | Global Business Solutions

At the time of writing, the Employment Equity Amendment (EEA) Bill had just been referred to the National Assembly and it will change the transformation landscape in a number of ways, which we will discuss in this article. What is almost certain, however, is that organisations, which have been dragging their feet regarding achieving equitable representation at all occupational levels, will now have to analyse the sectoral targets very carefully.

The big-ticket item contained in the amendments is section 15A. In terms of this, the Minister of Employment and Labour will set numerical targets for the representation of black individuals, women and persons with disabilities for employers in defined sectors. In other words, the discretion that employers and their Employment Equity committees had in setting goals and targets is essentially overshadowed by said sectoral targets. The teeth of this amendment are in the reality that if designated employers do not achieve these targets, the first consequence is that they will not pass a compliance audit under section 42, nor will they receive a certificate of compliance which will disqualify them from tendering for State contracts under section 53. Provision has been made for a designated employer to raise a reasonable ground for not achieving these targets, which may include mergers, acquisitions, operational restructuring and the like. However, the starting point is non-compliance.

There is a concern that although the amendments require the Minister of Employment and Labour to engage with the National Minimum Wage Commission, and then to publish the targets for 30 days to receive commentary from interested parties, the engagements with Department of Employment and Labour will have to be all-inclusive as this requirement could possibly be challenged. A non-inclusive, consultative approach benchmark will have to be achieved. In addition to employers not achieving the sectoral targets, they will also not receive a compliance certificate if the employer has been on the receiving end of an award, in the prior three years, from the CCMA or Labour Court regarding unfair discrimination under Chapter 2. Similarly, the failure to pay the National Minimum Wage will also result in the same sanction.

Another significant change is that at workplaces where there is a representative trade union, the said union – along with the employer – will comprise the entire committee. This means that the previous provision, which blended non-unionised representatives with unionised representatives, will be no more.
In terms of the amendments, all employers employing more than 50 employees must comply with Chapter 3 (affirmative action) of the Employment Equity Act. Previously, the provision was that even if employers employ less than 50 employees, if their annual turnover exceeded a stipulated threshold they would have to comply.

The definition people with disabilities had been broadened to include specifically intellectual or sensory impairment which, in interaction with various barriers, may limit their prospects of entry into – and advancement within – employment. This will allow employers to refresh their calls for confidential self-disclosure by employees in terms of this important matter.
The provision that the Health Professions Council, or similar bodies, may be authorised to certify tests and assessments has been repealed. The Labour Court will rule as to the validity of tests and assessments.

Employers urgently need to consider what the ramifications of these amendments are at the workplace. Firstly, there will probably be a need to reconstitute and re-train committees. Secondly, the Employment Equity targets that currently have been consulted on will have to be reviewed in line with the pending sectoral targets.

As a consequence of this, organisations will have to review their recruitment, selection, promotion, training, retention and related policies and practices to ensure that they enable the achievement of sectoral targets. Finally, governance in respect of transformation will have to be taken up a few notches as the ramifications of not complying are significant from an economic and social viewpoint.