Compliance requirements for Employment Equity (EE)


Employment Equity Act

Introduction

The Employment Equity Act requires every designated employer to develop and execute an Employment Equity plan with the aim of achieving reasonable progress towards Employment Equity, eliminating unfair discrimination, and promoting equitable representation of employees from designated groups through affirmative action measures. The plan must outline the steps the employer will undertake to achieve these objectives, and the Department of Labour has provided guidance through the Code of Good Practice on the Preparation, Implementation and Monitoring of Employment Equity Plans and the User Guide to the Employment Equity Act.

Employers can customize their plans, and the Act applies to all designated employers and their employees, particularly those from designated groups. Designated employers are those who employ 50 or more employees, employers with less than 50 employees but whose annual turnover equals or exceeds the amounts in Schedule 4 of the EEA, or an employer who has been declared a designated employer in a collective agreement. The National Defence Force, National Intelligence Agency, and South African Secret Service are excluded, while designated groups are Africans, Coloureds, Indians, women of all races, and people with disabilities.

All employers with 50 or more employees must report, while those with 150 or more employees must comply with reporting requirements for larger employers. Chapter 3 of the Employment Equity Act mandates affirmative action measures, such as consulting with unions and employees, analysing employment policies and practices, and preparing and implementing an Employment Equity plan. Employers must also report to the Department of Labour on plan implementation, display summaries of the Act’s provisions, and take into account the Code of Good Practice on the Implementation of Employment Equity Plans.

In implementing EE, employers should refer to the Code of Good Practice on the Implementation of Employment Equity Plans, the Employment Equity Act, Regulations under the Employment Equity Act, and the user guide published by the Department of Labour. While the Code of Good Practice is not law, it provides valuable information and guidance for employers and should be considered.

Compliance Requirements

In order to be in compliance with the Employment Equity Act, a Designated Employer Entity must commit to adhering to all the provisions outlined in the Act, with specific attention paid to Sections 13, 15, 16, 17, 18, 19, 20, 21, 24, and 27.

Section 13

According to Section 13 of the Employment Equity Act No. 55 of 1998, a Designated Employer is required to take affirmative action measures for Designated Groups to achieve employment equity. This includes consulting with employees, conducting an Economically Active Population (EAP) analysis, and preparing an Employment Equity Succession Plan.

Section 15

Section 15 of the Employment Equity Act No. 55 of 1998 requires a Designated Employer to implement affirmative action measures aimed at providing equal opportunities and equitable representation for suitably qualified employees from Designated Groups across all occupational categories and levels of the workforce.

Section 16 & 17

Sections 16 and 17 of the Employment Equity Act No. 55 of 1998 require a Designated Employer to take reasonable steps to consult with representatives of employees who represent the diverse interests of the workforce. This consultation should be conducted when analyzing the workforce and preparing the Employment Equity Succession Plan.

Section 18

Section 18 of the Employment Equity Act No. 55 of 1998 requires a Designated Employer to disclose relevant information to the consulting parties, which include the CEO, Employment Equity Manager, Employment Equity Forum, and employees.

Section 19

Section 19 of the Employment Equity Act nr 55 of 1998 requires Designated Employers to carry out an examination of their employment policies, practices, procedures, and work environment to identify any obstacles that may negatively impact members of Designated Groups. This analysis should also involve creating a profile of the workforce to ascertain the extent to which Designated Groups are not proportionately represented in the workplace.

Section 20

Section 20 of the Employment Equity Act nr 55 of 1998 requires that a Designated Employer develop and execute an Employment Equity Plan aimed at achieving reasonable advancement towards employment equity within the Employer’s workforce.

Section 21

Section 21 of the Employment Equity Act nr 55 of 1998 mandates that a Designated Employer must provide its initial report to the Director General (Department of Labour) within 12 months of the Act’s commencement in 1999, and subsequently on an annual basis.

Section 22 (Listed Entities Only)

Section 22 of the Employment Equity Act nr 55 of 1998 requires that any Designated Employer that is a Public Company must include a summary of the report required by Section 21 in that Employer’s annual financial report.

Section 23

Section 23 of the Employment Equity Act nr 55 of 1998 mandates that a Designated Employer must prepare a subsequent Employment Equity Plan before the expiry of its current plan term.

Section 24

Section 24 of the Employment Equity Act nr 55 of 1998 requires a Designated Employer to appoint one or more Senior Manager(s) to oversee the implementation and monitoring of the Employment Equity Plan. The Employer is also obligated to provide the necessary resources for the Senior Manager(s) to fulfil their duties.

Section 25

Section 25 of the Employment Equity Act nr 55 of 1998 requires that an Employer must exhibit, at its workplace in a place where it is easily visible and accessible to employees, a notice in the prescribed form, providing information about the provisions of the Act.

Section 26

A Designated Employer is required to create and maintain records related to its workforce, Employment Equity Plan, and any other records that pertain to compliance with the Employment Equity Act nr 55 of 1998 for a specified period.

Section 27

Section 27 of the Employment Equity Act nr 55 of 1998 requires that each Designated Employer, in their report, must provide a statement to the Employment Conditions of Commission established by Section 59 of the Basic Conditions of Employment Act. This statement should detail the remuneration and benefits received by employees in each occupational level of the Employer’s workforce.

Section 43 and 44

The review and outcome of the Director General’s review refers to the process by which the Director General of the Department of Labour evaluates and assesses a Designated Employer’s compliance with the Employment Equity Act nr 55 of 1998. This review may include an assessment of the employer’s Employment Equity Plan, workforce profile, and other relevant records, as well as interviews with management and employees. Based on this review, the Director General may provide feedback and recommendations to the employer on how to improve their compliance with the Act.

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