Employment and Labour Minister Thulas Nxesi. File picture: GCIS
The new Employment Equity Amendment Bill, which President Cyril Ramaphosa signed into law last month, is meant to promote diversity and equality in the workplace.
Instead, it is only stirring up political tensions and economic anxiety, and is set to lead to a legal battle over its constitutionality.
The amendment bill seeks to transform South Africa’s workforce by setting equity targets for 18 economic sectors and in the nine provinces.
The bill only applies to employers with more than 50 employees, who have to submit employment equity plans with provision for race, gender and disability, among others.
Meet the “targets” and the companies qualify for certificates of compliance to do business with the government. Fail to make the numbers and bosses face a penalty of up to 10% of annual turnover.
On May 12, Minister of Employment and Labour Thulas Nxesi published a gazette calling for comments on the sectoral targets. Firms have been given 30 days to offer their input.
Already, opposition parties are calling the bill nothing but a more stringent and draconian quota system. A “pencil test” that favours black South Africans over whites, coloureds and Indians – who stand to be completely shut out from certain sectors and regions in the economy.
Other critics warn of the impact on an economy already battered by load shedding and inflation, productivity, efficiency and an exodus of skills from the South African job market.
The Department of Labour however insists there is nothing substantially new about the act, which has been around for over 24 years.
The major change is that the bill empowers the Employment and Labour Minister to “set employment equity targets for economic sectors, as well as regions where transformation is lagging. The bill also empowers the minister to regulate compliance criteria to issue compliance certificates”.
Employers still maintain powers to determine their own annual employment equity targets towards achieving the regulated five-year sector targets, the department said.
What is clear from the concerns raised is that the Department of Labour needs to engage properly with each sector to establish realistic targets for the next five years. Different sectors possess unique skill sets, and thorough consultation is necessary to understand why there is an inadequate representation in the labour market.
Inefficiencies in education and training also need to be addressed in the debate.
* Taariq Halim, Editor of the Cape Argus newspaper.
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