The Department of Employment and Labour (DEL) says that it is giving businesses in South Africa a “weapon” to defend themselves against new employment equity laws which aim to speed up transformation in every major sector in the country.
Speaking at the latest national workshop on the new laws, the department conceded that it was putting pressure on businesses with the new laws but at the same time, was giving them an ‘out’.
“The proposed amendments to the employment equity (EE) laws will provide double-pronged flexibility in that they will allow employers to consult and self-regulate their equity targets while also allowing employers to raise justifiable reasons for non-compliance with the law,” the department said.
Putting it more plainly, DEL Deputy Director of Employment Equity, Masilo Lefika said: “We are giving you the law and, at the same time, giving you a weapon to defend yourselves.”
According to the amended EE legislation and Regulations, while businesses are expected to develop five-year plans to meet the EE targets as determined by the minister, they are also allowed to flout these targets on “justifiable reasons or grounds”.
Some of the justifiable grounds listed to be considered for failure to comply with the annual EE targets include:
- Insufficient promotion opportunities;
- Insufficient recruitment opportunities;
- Insufficient target individuals from the designated groups with the relevant qualifications, skills and experience;
- CCMA/Court Order;
- Transfer of business;
- Merger/ acquisitions; and
- Impact on business economic circumstances such as the impact of the Covid pandemic on business, load-shedding, etc.
Lefika said the justifiable reason for non-compliance were not “thumb-sucked” and came as a result of engagement with Nedlac and social partners. The list also got the nod from one of the biggest critics of the new laws, trade union Solidarity.
However, while these grounds should equip businesses with sufficient “flexibility” around the controversial targets, the onus is still on the businesses to prove their case to the department, adding further administrative and legislative burdens on operations.
The department reiterated that the objective of the amendments is to effectively reduce the regulatory burden for small employers while also empowering the minister to regulate sector-specific numerical EE targets.
It will also look to strengthen compliance through the issuing of EE compliance certificates.
Under the regulations, all businesses in South Africa that employ more than 50 people will have to comply with the targets and EE requirements set out by the department – regardless of whether they do business with the state or note.
Failure to comply could result in steep fines and penalties.
The department said that the state has been forced to get tougher on transformation in the country due to the slow pace of progress in uplifting previously disadvantaged workers and reshaping companies – particularly at the senior and top management level – to reflect the demographics of the country.