President Cyril Ramaphosa has signed the Employment Equity Amendment Bill of 2020 into law. The Bill amends the Employment Equity Act of 1998 with new measures that aim to promote diversity and equality in the workplace.
One of the key provisions in the bill empowers the Minister of Employment and Labour Thulas Nxesi to set employment-equity targets for different economic sectors. These targets may be differentiated regionally and where the minister deems first.
The amended Act allows the Minister of Employment and Labour to set regional targets given that racial diversity in South Africa often has regional differences.
The minister is also able to regulate the compliance criteria to issue Compliance Certificates. Compliance certificates serve as a prerequisite for businesses and companies to do business with the government.
Employers with more than 50 employees will be required to submit employment equity plans which indicate how they will achieve these targets. Employers will be required to submit annual reports to the Employment and Labour Department.
The law further requires employers to pay workers equal pay for equal work. Workers will also be able to find a clear definition of discrimination in the bill and guidance on what they may do should they face discrimination.
The Presidency explained that companies who wish to do business with the government will be required to submit a certificate from the Department confirming that they comply with the Employment Equity Act and its objectives. They also may not pay their employees less than the national minimum wage.
Business Unity South Africa (BUSA) CEO Cas Coovadia says the signing into law of the amendment bill ends a long period of uncertainty on the proposed changes to South Africa’s transformation laws.
They explained that they are pleased that employment equity targets for sectors will be set by the Employment minister only once consultation with the relevant business and employer bodies in the affected sectors has taken place.
However, they cautioned that some aspects of the law remain problematic. BUSA raised these concerns during the public hearings process in parliament.
This includes measuring compliance and issuing compliance certificates as a licence to do business with the state will depend on whether a company has met its targets and does not have a case of unfair discrimination raised against it at the CCMA or Labour Court in the previous 12 months.
They are also concerned that the employment equity targets are being treated as quotas. They cautioned that complex arrangements increase the compliance burden, which could derail transformation.
Coovadia said, “Companies should not be subjected to double punishment by the CCMA or Labour Court and the Department of Employment and Labour for the same issue, which could lead to unnecessary litigation and derail our objective of transformed workplaces.”
The Employment Equity Amendment Bill of 2020 also compels labour inspectors to inspect workplaces and issue employers with compliance orders. The presidency said the labour department has committed to increasing its number of inspectors to enforce compliance.
