President Cyril Ramaphosa has signed the Employment Equity Bill into law, aiming to promote diversity and equality in the workplace and empower the government to set specific equity targets by sector and region. The bill was passed by Parliament on 17 May 2022 and was officially signed into law on 12 April 2023, as confirmed by Presidential spokesperson Vincent Magwenya during a recent briefing.
The Employment Equity Amendment Bill, 2020 introduces several key changes to the existing legislation in order to promote greater compliance and accountability in the pursuit of workplace transformation in South Africa. The main objectives of the amendments are to empower the Employment and Labour Minister to regulate sector-specific Employment Equity (EE) targets and to regulate compliance criteria to issue EE Compliance Certificates in terms of Section 53 of the EE Act.
One of the significant changes brought about by the new law is the revision of the definition of a “designated employer.” Previously, a designated employer was defined as an employer with 50 or more employees or an employer with a turnover above a certain threshold determined by the EE Act, depending on the relevant sector.
However, the definition has now changed so that employers with fewer than 50 employees, regardless of their annual turnover, will no longer be considered designated employers and will be exempt from compliance. This change has a practical impact on smaller businesses, as they will no longer be required to implement measures to ensure suitably qualified people from designated groups have equal employment opportunities and representation at all occupational levels in the workplace.
Another important aspect of the law is the empowerment of the employment and labour minister to regulate sector-specific equity targets and compliance criteria. This means that the minister will have the discretion to set equity targets for different sectors, which may vary depending on the unique characteristics and needs of each sector. Designated employers will need to closely monitor the regulations put in place by the minister and ensure compliance with the sector-specific equity targets.
In addition, the law requires companies with more than 50 employees to submit employment equity plans outlining how they will meet the equity targets set by the government. These plans need to be submitted annually to the Department of Employment and Labour, and companies seeking to do business with the state will be required to submit a certificate confirming their compliance with the Employment Equity Act and its objectives, as well as confirmation that they do not pay their employees less than the national minimum wage.
To monitor the implementation of sector targets, a new EE online assessment system will be created, and assessments will be done annually. This means that designated employers will need to regularly assess and report on their progress towards meeting the equity targets set by the government.
The law also strengthens enforcement measures, as labour inspectors are now compelled to inspect workplaces and issue compliance orders to employers. The Department of Employment and Labour has committed to increasing the number of labour inspectors and health and safety inspectors to enforce compliance, indicating a heightened focus on ensuring that workplace transformation objectives become a reality.
The enactment of the Employment Equity Bill underscores South Africa’s commitment to promoting workplace diversity and equality. Businesses, especially designated employers, will need to ensure compliance with the law by submitting employment equity plans, monitoring sector-specific targets, and being prepared for increased enforcement by labour inspectors. These amendments aim to drive greater transformation in the workplace and promote inclusivity and equality in the South African labor market.
