Various business and labour organisations have voiced their opinions concerning the signing into law of the Employment Equity Amendment Act, urging caution and in some cases alarm about its impact on businesses and the cost of doing business. This is part one of a two-part article.
Business Unity South Africa (BUSA) welcomed the signing into law of the Bill by President Cyril Ramaphosa, saying this ended a long period of uncertainty on the proposed changes and impact of transformation laws.
The step was in line with the position the organisation adopted throughout the Bill process from the National Economic Development and Labour Council to Parliament, it noted.
BUSA is further pleased that employment equity targets for sectors will be set by the Minister of Employment and Labour only after consultation with the relevant business and employer bodies in the affected sectors.
“In our view, meaningful consultation on sector targets affirms social dialogue and will ensure the relevance of the set targets,” said BUSA CEO Cas Coovadia.
However, BUSA is aware that some aspects of the law remain problematic, which the organisation had raised in Parliament during the public hearings process in 2021 and 2022.
For example, it said, measuring compliance and issuing compliance certificates as a licence to do business with the State would depend on whether a company had met its targets and did not have a case of unfair discrimination raised against it at the Commission for Conciliation, Mediation and Arbitration (CCMA) or Labour Court in the previous 12 months.
“What concerns us is treating targets as quotas, which would be against the spirit and letter of the law anyway. Companies should not be subjected to double punishment by the CCMA or Labour Court and the Department of Employment and Labour (DEL) for the same issue, which could lead to unnecessary litigation and derail our objective of transformed workplaces,” he said.
Further, BUSA also expressed concerns around the fragmentation of policy objectives and enforcement mechanisms within government, with some companies, because of their sectors, expected to comply with different transformation targets administered by different government departments or entities.
“These complex arrangements increase the compliance burden, which, in turn, may derail transformation, especially at a time when South Africa desperately needs economic growth to generate much-needed employment,” Coovadia cautioned.
BUSA would continue constructive engagements with the DEL on the implementation arrangements, which would hopefully resolve some of the concerns it raised, he said.
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