EEA Roadshow Sheds Some Light on the Controversial Amendments

The controversial amendments to the Employment Equity Act (“EEA”) have, to say the least, caused confusion and panic amongst employers, particularly in relation to the new sectoral numerical targets.

Written By of Cowan-Harper-Madikizela Attorneys

The recent EEA Roadshow, presented by the Department of Employment and Labour (“DoEL”), provided some clarity on how the changes would be implemented by DoEL. A summary of our understanding is briefly set out below.

  • During the 2022/2023 financial year approximately 1063 inspections were conducted by the DoEL and only some 42% of employers were found to be compliant with the provisions of the EEA. To that end some 68% of the inspected employers were issued with contravention notices. Similarly, during the current financial year, some 160 inspections have been conducted and only some 21 employers were found to be compliant with the provisions of the EEA.
  • Although the EEA was introduced some 25 years ago, both transformation and compliance with the provisions of the EEA have been incredibly slow and for this reason the current amendments have been introduced.
  • Although a certificate of compliance, a prerequisite for access to State contracts, requires that no adverse unfair discrimination award has been made against a designated employer prior to a compliance certificate being issued, matters which have not been finalized will not be considered by the DoEL for this purpose. Accordingly in circumstances where a designated employer, who has been found guilty of unfair discrimination, appeals that decision, no disclosure will have to be made until the matter has been finalized by the Courts.
  • The issuing of compliance certificates will furthermore be automatic where employers are compliant, although inspectors will be able to revoke certificates in circumstances where it is found that an employer has indeed failed to comply with the provisions of the EEA. The DoEL has previously indicated that more inspectors would be appointed in order to enforce compliance with the EEA.
  • Employers, when registering on the DoEL’s online portal, will have the discretion to elect its core sector and whether either national or provincial targets will be applicable. This election may however only be made once during each five-year plan.
  • Employers will similarly be able to set their own annual numerical targets against which they will be measured each year. Critically, employers will only be required to reach the sectoral targets at the end of the 5-year period.
  • In circumstances where an employer fails to meet their own annual numerical targets the employer will be able to select a justifiable reason from various options on the DoEL’s website. These justifiable reasons include insufficient recruitment opportunities, insufficient promotion opportunities, insufficient target individuals from designated groups, CCMA/ Court orders, transfer of business, merger/acquisition and impact on a business’ economic circumstances.

Although the DoEL’s Roadshow has shed some light on critical and deeply concerning issues to many employers, it is regrettable that these issues have not been dealt with in the amendments or draft regulations to clarify the situation. The confusion already surrounding these issues will undoubtedly lead to litigation.

It is also critical to note that although the amendments have been signed into law by the President, the commencement date is yet to be announced. SMMEs and other employers (who have recently been excluded from the definition of a ‘designated employer by the amendments) are thus still required to comply with the burdensome provisions of the EEA.

The commencement of the amendments, for better or worse, do not appear to be imminent.

Tanya Mulligan

Tanya Mulligan
Executive in Employment

Neil Coetzer

Neil Coetzer
Head of Employment

Share This Article

© 2021 - 2024. Cowan-Harper-Madikizela Attorneys
All Rights Reserved.