Employment Equity Amendment Act

It is important for South African employers to be prepared to implement the new measures which aim to improve diversity and equality in the workplace. 

Some key changes that employer’s need to take note of are:

“Designated Employers”

The definition of “designated employer” has been amended to “an employer who employs 50 or more employees”.  

Each sector in which a designated employer operated was previously subject to a prescribed annual turnover. Following the removal of this condition, more employers are now subject to the affirmative action provisions of the Employment Equity Act, No. 55 1998 (“EEA”). 

“People with disabilities”

According to Stats SA [link], in 2022 around 3.3 million South Africans were identified as living with disabilities. The definition of “people with disabilities” has been amended in line with the United Nations Convention on the Rights of Persons with Disabilities, 2007 to include “people who have a long-term or recurring physical, mental, intellectual or sensory impairment which, in interaction with various barriers, may substantially limit their prospects of entry into, or advancement in, employment”

Employers must acknowledge the updated definition of a disabled person and take proactive steps to accommodate disabled employees’ needs and ensure that they are afforded equal opportunities to succeed in the workplace. 

“Sectoral Numerical Targets”

Section 15A of the Act introduces sectoral numerical targets, which are specific quotas established by the Minister of Employment and Labour for economic sectors. The draft regulations, which are still in draft form, list the economic sectors as: 

1. Agriculture, forestry and fishing;
2. Mining and quarrying;
3. Manufacturing;
4. Construction;
5. Financial and insurance activities;
6. Transport and storage;
7. Information and communication;
8. Water supply, sewerage, waste management and remediation activities;
9. Electricity, gas stream and air conditioning supply;
10. Human health and social work activities;
11. Arts, entertainment and recreation;
12. Real estate activities;
13. Professional, scientific and technical activities;
14. Wholesale and retail trade; repair of motor vehicles and motorcycles;
15. Accommodation and food service activities;
16. Public administration, defence and compulsory social security;
17. Education; and
18. Administrative and support activities. 

These quotas aim to enhance the representation of designated groups, including black people (as defined in the EEA, which include Black, Indian and Coloured people), women, and individuals with disabilities, within these sectors. Designated employers operating within these sectors are obligated to meet these quotas to ensure equitable employment practices. 

There is an obligation on employers to reflect the implementation of the sectoral numerical quotas and set clear goals for the employers’ employment equity plans, as well as yearly targets. Further, the employment equity plans should also outline specific actions, strategies for monitoring and evaluation, and timelines for affirmative action and the hiring of designated groups. 

Failure to comply with the quotas without a reasonable excuse might result in employers being ineligible to perform government contracts and risk being fined between 2% and 10% of their yearly income.

However, it is important to note that two separate and very different draft regulations detailing the sectoral targets have been published in May 2023 and February 2024 and a definitive consensus has not yet been reached. Once the Minister of Employment and Labour has published final regulations in relation to the sectoral targets and they come into force, designated employers will have to re-evaluate their employment equity plans to ensure they are brought in line with the sector-specific targets. 

“Authority of Labour Inspectors”

Labour inspectors have the authority to obtain written undertakings from designated employers to comply with specific obligations, such as preparing and implementing employment equity plans as well as the authority to secure ‘an undertaking to comply’ from a designated employer. Labour inspectors may also issue and serve compliance orders on a designated employer who has failed to comply with sections 16,17,19,22,24,25 or 26 of the EEA.

Overall, the amendments seek to further the realisation of the purpose of the EEA, ensuring that there is fair representation of historically disadvantaged groups within the workforce in an equitable manner. 

Should you have questions or queries on the Employment Equity Amendment Act or require assistance with implementing the changes, please contact our offices.