Major BEE changes for businesses in South Africa waiting on Ramaphosa

Businesses in South Africa are waiting with bated breath for the promulgation of the government’s significant amendments to the Employment Equity Act (EEA), which were expected to go live on 1 September 2023.

According to law firm Bowmans, previous communications from the Department of Employment and Labour (DEL) had indicated that the changes would kick in from the start of the month – however, more recent communications alluded to the start date being pushed back.

“The DEL recently issued a notice to all employers concerning the 2023 employment equity reporting period in which it confirms that the reporting period will open (from) 1 September 2023 and that all designated employers are to submit their annual employment equity reports in terms of the current provisions of the EEA, as the Employment Equity Amendment Act (EEAA) is not yet in effect,” Bowmans said.

The EEAA was signed into law by President Ramaphosa on 6 April 2023. However, the provisions of the EEAA did not immediately come into force and are to take effect on a date fixed by the President by proclamation in the Government Gazette.

The weekly National Government Gazette had not yet been published at the time of reporting.

The news laws will, among other things, set particular demographic compositions that designated employers must achieve, or face severe penalties – including the inability to do business with the state, the cancellation of existing state contracts, compelling orders, and fines.

Designated employers include every private-sector employer employing 50 or more people, every municipality, and almost every organ of state.

Businesses will also be required to alter their reporting based on the new laws.

Based on previous media statements by the DEL, it was anticipated that the amendments would come into force with effect from 1 September 2023.

As recently as this week, the Director of Employment Equity has been quoted as saying that it was the DEL’s intention for the amendments to come into effect from the start of the month.

This would be to allow employers to report on the new updated reporting system. The DEL said it is ready to implement the amendments.

However, the President must proclaim the effective date, and this proclamation notice is still pending.

“It is anticipated that, upon proclamation of the effective date, the employment equity regulations and final sector targets will be published for implementation,” Bowmans said.

“Accordingly, as things currently stand, the amendments are not yet in effect. We have no indication as to when the proclamation notice will be published.”

In the circumstances, designated employers, including employers who employ fewer than 50 employees and meet the (current) applicable turnover thresholds, are required to submit their annual reports for the 2023 reporting period as usual.

The closing date for manual submissions is 2 October 2023, and online submissions is midnight on 15 January 2024.

Read: Government giving businesses a ‘weapon’ to defend against new BEE laws