Employment Equity
Employment Equity (EE) Reporting 2022
This is a reminder that it is time for the annual Employment Equity Reporting for the 2022 period.
All designated employers must submit their annual Employment Equity (EE) reports to the Department of Employment and Labour between the 1st of September 2022 and the 15th of January 2023.
A Designated Employer is an employer who employs 50 or more employees, or an employer who employs fewer than 50 employees, but has a total annual turnover that is equal to or above the annual turnover threshold specified for the relevant sector as follow:
| Subsector | Total annual turnover threshold |
| Agriculture | R6 million |
| Mining and quarrying | R22,5 million |
| Manufacturing | R30 million |
| Electricity, gas and water | R30 million |
| Construction | R15 million |
| Retail and motor trade and repair services | R45 million |
| Wholesale trade, commercial agents and allied services | R75 million |
| Catering, accommodation and other trade | R15 million |
| Transport, storage and communications | R30 million |
| Finance and business services | R30 million |
| Community, social and personal services | R15 million |
The Department of Employment and Labour is responsible for monitoring and evaluating the implementation of affirmative action. To do this, it needs to receive regular reports from companies on their progress toward achieving such affirmative action targets. Reporting to the department is a legal requirement. Failure to comply with the EE Act may result in fines ranging from 2% to 10% of a company’s turnover.
We urge clients to finalise their company’s reporting as soon as possible as the Department of Employment and Labour’s EE portal becomes rather congested nearing the deadline of 15 January 2023. Our recommendation is to have reporting finalised before the 15th of December 2022.
The Department of Employment and Labour seriously stepping up Director-General (DG) Reviews and Prosecutions
According to ZA News, a total of 860 Director-General (DG) reviews were conducted nationally during the period of 01 April 2021 to 31 March 2022. Of these, 94% were found to be non-compliant with the EE Act, and 60% were referred to prosecution for failure to comply with Employment Equity (EE) legislation, including failure to achieve annual EE targets set by designated employers.
A Director-General may conduct a review to determine whether an employer is complying with the EE Act of 1998. The review involves requesting:
- the employer to submit a current analysis of their workforce or Employment Equity Plan;
- the employer to submit to the DG any book, record, correspondence, document or information that could reasonably be relevant to the review of the employer’s compliance with the EE Act;
- a meeting with an employer to discuss its Employment Equity Plan, the implementation of its plan and any matters related to its compliance with this Act; and
- a meeting with any employee or the respective trade union that was consulted in terms of section 16 of the EEA, work forum or another person who may have information relevant to the review.
The Employment Equity Amendment Bill will come into force on the 1st of September 2023
The amended Employment Equity (EE) Act of 1998, will come into force on the 1st of September 2023.
The Department of Employment and Labour’s Acting Deputy Director-General (DDG) of Labour Policy and Industrial Relations (LP&IR), Thembinkosi Mkalipi, said the signing of the Bill by President Cyril Ramaphosa was imminent. He expressed that this was expected to happen between now and the beginning of the 2023 year (as stipulated by the Government’s website on the 31st of August 2022).
The Employment Equity Amendment Bill of 2020 was passed by Parliament (National Assembly and National Council of Provinces) on 17 May 2022 and is waiting for the assenting and signing into law by the President.
The main objectives of the Amendments are to empower the Minister to regulate sector specific EE Targets and to regulate compliance criteria to issue EE Compliance Certificates in terms of Section 53 of the EEA. This means that organisations that do business with the State will have to be in good standing regarding their compliance with EE. The DDG cautioned that even those businesses that do not necessarily do business directly with the State will have to comply with the law.
Mkalipi said the Department will, in due course, publish the list of sector targets for public comment.
“The implication for employers is that if you have an EE plan in place it will be affected by the setting of targets and you will have to revisit your targets,” said Mkalipi.
Mkalipi stated that a new EE online assessment system will be created to monitor the implementation of sector targets and that the assessment will be done annually. He explained that the system will allow employers to report on their planned targets and how they intend to achieve those.
According to Mkalipi, in the financial year of 2024, the first year which is post the sector target setting period, the system will be able to tell whether employers had achieved their targeted plans. He said in cases where employers were not meeting their target, they would need to have justifiable reasons for not achieving their set targets.
“The system will accept in good faith all the information supplied. The Department will, through the inspectorate, visit workplaces to verify if information submitted is genuine,” he warned. In cases where the information submitted was not genuine, a Certificate of Compliance will be withdrawn and penalties will be enforced.
Conclusion
Our team is ready to assist you in ensuring that you fully comply with the Employment Equity Act. Our relevant services include:
- Training the Employment Equity Forum / Committee members on the requirements of the Employment Equity Act and their role as committee members;
- Coordination of the process necessary to establish an Employment Equity Forum / Committee and an Employment Equity Manager;
- Consultations / meetings with the Employment Equity Forum / Committee;
- Development of a comprehensive Employment Equity Policy;
- Conducting a workplace analysis (EEA12);
- Development of the Employment Equity Plan (EEA13) as required by the Act;
- Coordination of the process to complete EEA1 forms by all employees;
- Successful reporting of the Employment Equity documents (EEA 2 & EEA4) to the Department of Employment and Labour;
- Presenting a workshop / awareness training regarding “Embracing diversity in the workplace” to all employees; and
- Presenting a workshop / awareness training regarding the “Prevention and elimination of harassment in the workplace”.
If you wish to make use of Joubert & Associates for your EE compliance / reporting process, kindly let us know as soon as possible:
info@hrsa.co.za / 021 863 0966
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