Quotas vs targets – what South Africa’s planned ‘transformation’ laws will change

The Deployment of Employment and Labour says that the planned Employment Equity Amendment Bill will focus on targets rather than quotas.

The proposed bill will enable the labour minister, in consultation with the stakeholders of a particular sector, to set numerical sector-specific employment equity targets. These targets may differ across occupational levels, sub-sectors, regions or based on other relevant factors.

The amendment, if effected, will require that an employer, in setting its numerical goals, comply with any sector target. Employers’ employment equity plans must also address these numerical targets.

Companies that fail to comply with the targets can be fined between 1% and 10% of turnover and will be disqualified from doing business with the government.

Presenting on the bill to parliament this week, the department’s Thembinkosi Mkalipi said that there was a key difference in the bill’s proposed introduction of sectoral targets and a ‘quota system’.

He said that quotas are mandatory outcomes that are rigid and must be achieved at all costs.

By comparison, he said that the bill’s sector-specific employment equity targets are closer to ‘aspirational goals’ and allow for flexibility to achieve these goals where practicable.

“Employers have powers to set their own annual employment equity targets in their own employment equity plan, through consultation with employees and trade unions,” he said.

He added that there are a number of justifiable reasonable grounds for not complying with the targets, including:

  • Insufficient recruitment opportunities;
  • Insufficient promotion opportunities;
  • Insufficient target individuals from the designated groups with the relevant qualification, skill and experience;
  • Court Order;
  • Transfer of business;
  • Mergers/Acquisitions; and
  • Impact on business economic circumstances.

“In light of the above discussion on flexibility, it is clear that sectoral employment equity targets are not quotas,” he said.

Mkalipi said that in June 2019, the department of labour and the commission for employment equity started a consultation process with each economic sector separately with the purpose of reaching consensus on the setting of employment equity sector-specific targets for the designated groups, particularly at the top four occupational levels:

  • Top management;
  • Senior management;
  • Professionally qualified;
  • Skilled technical level.

“Notwithstanding that the promulgation of the Employment Equity Amendment Bill is still underway in Parliamentary processes, the Department and commission have made significant strides in relation to the consultation process through sector stakeholder engagements,” he said.

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Quotas vs targets – what South Africa’s planned ‘transformation’ laws will change