New inspectors appointed to enforce Employment Equity Amendment Act

IOL News

26-04-2025

The Department of Employment and Labour has this week announced its new strategy to enforce Employment Equity Amendment Act in private companies
Image: Leon Lestrade/ Independent Newspapers
THE Department of Employment and Labour has brought in 50 inspectors to force private companies to implement the Employment Equity Amendment Act (EEAA), which came into effect early this year despite the opposition from the Institute for Race Relations (IRR).
The IRR, which was still preparing legal papers intending to approach the court to nullify the act, which it called 'the most counterproductive racial labour law.'
In a statement released on Friday, the department said the 50 inspectors were briefed on Thursday in a workshop held in Pretoria on how to go about enforcing the Act.
The Act, which promotes affirmative action in businesses that have 50 and above employees, would ensure that all racial groups and people with disabilities were represented according to their demographic population in all management positions.
Department's Employment Equity Directorate deputy director, Masilo Lefika, said in a statement released on Friday that the targeted employers must 'prepare and implement an Employment Equity (EE) Plan for the period from 1 September 2025 until 31 August 2030.'
'The designated employer must comply with the numerical targets set in terms of section 15A (3) for the economic sector in which they operate.
'If the employer operates in more than one sector, it must apply the numerical targets for the sector in which the majority of their employees are engaged,' said Lefika.
The companies that would be found in breach of the law, including not having an approved Employment Equity Plan or failing to submit annual reports, by 2030 would receive hefty fines of up to R1.5 million or 2% of annual turnover.
However, some targeted companies might escape penalties only if they could justify their non-compliance.
'The justifiable reasons/grounds to be considered for failure to comply are insufficient recruitment opportunities, insufficient promotion opportunities, insufficient target individuals from the designated groups with the relevant qualifications, skills and experience, CCMA/ Court Order, transfer of business, merger/acquisitions, and the impact of economic circumstances on the business,' said Lefika.
However, the IRR described the EEAA as racially discriminatory.
'IRR Legal will challenge the EEAA in court to block its harmful impact on already scarce jobs, and vindicate the Bill of Rights,' read the IRR statement.
IRR believed that the EEAA was not just discriminating against whites, but was cutting across racial and gender lines as it was preventing racial groups from being overrepresented in companies and management positions.
IRR Legal Executive Director Gabriel Crouse said the institute was against the EEAA because it was violating 'the rainbow republic's Constitution'.
'There are two sets of regulations that exhibit the unconstitutionality of the Act, both published on April 15 2025.
'Our estimate is that 85% of the formally employed workforce is employed in companies with over 50 people, a fact which should always be noted when the exemption is mentioned, but seldom is,' said Crouse.
He said the Act was placing a racial moratorium on white men, but it was opening people of all races and genders to the vulnerability of being sidelined from being promoted to senior positions.
'The regulations state that employers 'must avoid perpetuating the over-representation of any group if their representation exceeds the applicable [Economically Active Population] in a particular occupational level'.
'That means if a designated company has 60 black women at senior management, then the company must avoid perpetuating the over-representation of that group as it exceeds the applicable EAP (Economically Active Population),' said Crouse.
The IRR was concerned that the Act could bankrupt businesses through fines for failing to comply.
'The new EEAA is doomed to backfire in the private sector as it has already backfired in the public sector, where it was used explicitly to stop black and Indian women from being able to get jobs, as well as blocking every other existing race-gender pair in various instances,' read the statement.
IRR said polls were indicating that EEAA, like all forms of BEE, was unpopular among South Africans, including blacks who preferred 'a meritocratic alternative to BEE to be implemented.'
Crouse said the IRR was still busy with the process of drafting court papers against the EEAA.
Cosatu's parliament spokesperson, Matthew Parks, said the federation was fully behind the Act, which he said complied with the constitution.
'The Employment Equity Act is nearly as old as our hard-won democracy and has stood the test of time, including previous court reviews.
'If the IRR had retained its once respected research capacity, it would be familiar with the 2023 amendments to the Employment Equity Act,' said Parks.
He said the amendment to the Act was a result of extensive engagements between labour and business at the National Economic Development and Labour Council (Nedlac) and parliament's public hearings.
'If the SAIRR was genuine in its desire to influence legislation, it would have exercised its constitutional rights to make representations to Parliament over the past thirty years.
'It may be that the IRR whose board and staff complement are over 75% white, feels uncomfortable with any requirement to embrace the non-racial ethos of the democratic South Africa,' said Parks.
Labour expert Michael Bagraim said while the EEA had been in existence for almost 30 years, it has been a complete failure as the regulations will worsen unemployment.
'The new regulations will not result in better demographics for the workforce, [as] the regulations in the past have benefited the very few who have become very rich.
'We need to go back to the drawing board to try and bring in a different type of dispensation to ensure that the workforce is reflective of the demographics,' said Bagraim.
[e-mail]