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South Africa: Draft sectoral targets for employment equity published

19 May 2023
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On 12 May 2023, draft regulations (Regulations) were published by the Minister of Employment and Labour setting out the proposed numerical targets for demographic representivity in 18 sectors.

The Regulations are published in terms of section 15A of the Employment Equity Amendment Act (Amendment Act) and propose targets for the top four occupational levels (namely, Top Management, Senior Management, Professionally Qualified, and Skilled) and for employees with disabilities.

The Regulations are still in draft form and interested parties are invited to submit comments to the Department of Employment and Labour by 12 June 2023.

The proposed sectoral targets have come as a surprise as the Amendment Act is not yet in effect. The Regulations are therefore premature and, if challenged, may be considered ultra vires.

Once in effect, the Amendment Act empowers the Minister to:

  • publish a notice containing the proposed national economic sectors for public comment. (Once finalised, the sectors would be published in the Government Gazette);
  • consult with the sectors on the proposed numerical targets; and
  • after consultation, and with the advice of the Commission for Employment Equity, publish a notice proposing numerical targets for the identified national economic sectors for public comment.

There are proposed Regulations from 2018 that contain a list of national economic sectors, but these are not yet in effect. In any event, they were not published in accordance with the enabling legislation, as the amendments are not yet in force.

Since 2019, various sectors have engaged with the Department on the numerical targets. However, any engagements with stakeholders that took place prior to the amendments coming into effect were conducted without the enabling legislation being in place and it remains to be seen how a court would view the status of such engagements. This is particularly in light of the much-changed environment since the Covid-19 pandemic and the current economic downturn.

Apart from the apparent procedural deficiencies, certain of the proposed targets themselves have been widely criticized. The Minister did not publish an accompanying explanatory memorandum as to how the targets were set.

A comparison of the numerical targets proposed with the percentages regarding the economically active population contained in Statistics SA’s latest Quarterly Labour Force Survey (for Quarter 1 of 2023), shows that, on balance, the numerical targets do not prescribe a higher representivity than the national EAP statistics, which is encouraging.

However, it is concerning that in some cases, there is a 0% target for certain demographic groups. If strictly enforced, these 0% targets would amount to an absolute barrier to employment and advancement in employment for people from these groups (who happen to fall within the designated groups), which is not in line with the objectives of the Employment Equity Act. Exclusion of groups from the outset and a rigid application of targets would undermine the underlying purpose of the right to equality. Numerical goals and targets on the other hand serve as a flexible guideline in pursuit of representivity and equality in the workplace.

Furthermore, the targets seem to have some numerical errors, with most of the national and provincial targets not equating to 100%. This raises questions regarding the basis and manner in which they were calculated.

The Department of Employment and Labour released a media statement on 16 May 2023 confirming, among other things, that the sectoral targets are not quotas, as employers still maintain their powers and responsibilities to determine their own annual employment equity targets towards achieving the regulated five-year sector targets.

The Department emphasised that these sectoral targets are ‘milestones’.  This confirms the principle in section 15(3) of the EEA that affirmative action measures include preferential treatment and numerical goals, but exclude quotas. Quotas refer to preferential techniques that have the effect of reserving all or a fixed percentage of job opportunities for people from designated groups. This is not what the EEA is about, and the Department confirmed that the EEA is about ‘equal opportunities in the workplace’.

The Regulations are creating confusion and may be the subject of legal challenge. Employers are encouraged to submit comments on the Regulations to the Department of Employment and Labour by the deadline.