The purpose of the Employment Equity Act, 55 of 1998, is to achieve equity in the workplace by promoting equal opportunity and fair treatment through the elimination of unfair discrimination and implementing affirmative action measures to ensure the equitable representation in all occupational levels of designated groups.
The effective date of the recent amendments to the Employment Equity Act, which was signed by President Ramaphosa on 14 April 2023, is yet to be proclaimed.
Whilst there have been several notable amendments, the most controversial relates to the power given to the Minister of Employment and Labour in section 15A to identify national economic sectors and set numerical targets in each of these sectors.
The draft sectoral numerical targets (draft targets) were published on Friday 12 May 2023. Interested parties have been given 30 days to comment.
The focus of the draft targets is top and senior management and professionally qualified and skilled levels and people with disabilities.
The draft targets indicate that an employer in one of the 18 economic sectors that has been identified, is required to employ a certain percentage of Black, Indian, Coloured and White male and female employees.
The draft provincial targets will apply to those employers that operate in the relevant province while the draft national targets will apply to those employers that operate nationally.
The 18 economic sectors identified include mining, manufacturing, financial and insurance, professional, scientific and technical, education, electricity, gas, steam and air as well as arts, entertainment and recreation.
The effect of this amendment is that a designated employer will be required to set numerical targets that align with the draft targets once these are finalised.
A compliance certificate may only be issued if the employer complies with the sectoral numerical targets or has demonstrated a reasonable ground for non-compliance.
The manner in which compliance certificates are obtained is not clear as the Draft Regulations which were published in 2018 have not been finalised or implemented. However, the Draft Regulations provide an indication of what would constitute reasonable grounds for non-compliance. These include:
- insufficient recruitment opportunities
- insufficient promotion opportunities
- insufficient target individuals with the relevant qualification, skills and experience
- court order
- transfer of business
- merger / acquisition; and
- impact on business economic circumstances.
A numerical target is distinguishable in law from a quota. Our courts have held that quotas are unconstitutional because they constitute an absolute barrier to the future or continued employment or promotion of people who are not from a designated group.
Commentators on the draft targets have expressed concern that they constitute a quota, which is unlawful.
It remains to be seen whether the time period for comments will be extended and when the amendments will be proclaimed and the draft targets finalised.
In the interim, it will be important for employers to carefully consider the draft targets and consider whether, should the draft targets be implemented in their current form, they would comply with the requirements. If not, they would need to consider whether there is a reasonable justification for non-compliance.
Watch this space!
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