Employment Equity (EE) is about fairness in the workplace. It exists to make sure everyone, regardless of race, gender and background, has opportunities to be trained and promoted. The Employment Equity Act (EEA) was introduced to correct past discrimination, and the Employment Equity Amendment Act, 2022 came into effect on 1 January 2025, bringing a new five-year EE Plan cycle that runs from 1 September 2025 to 31 August 2030.
One of the biggest questions we get is: Does this apply to my business at all?
The 50-Employee Threshold
From 2025, an employer is only classified as “Designated” if it has 50 or more employees. Annual turnover no longer plays a role in this classification, which is a significant shift from the old regulations. If your headcount is below 50, you fall into the Non-Designated category, regardless of how much revenue your business generates.
What Non-Designated Employers Still Need to Do
Having fewer than 50 employees means you are not required to submit annual EE reports. But if you undergo the B-BBEE verification process, you still need an Employment Equity Certificate of Compliance stating that you are Non-Designated.
What Designated Employers Need to Do
If your business has 50 or more employees, the obligations are far more complicated. Designated employers need to:
- Submit annual EEA2 and EEA4 reports
- Maintain a five-year EE Plan aligned to sector-specific numerical targets
- Consult an EE Committee
- Apply for a Certificate of Compliance
Grew Past 50 Employees? You Do Not Need to Panic
If your headcount has crossed the 50-employee mark, or dropped below it after you previously reported, there is no need to deregister from the EE database. The Department of Employment and Labour sent an activation link to all registered employers from September 2025, allowing each business to self-declare its Designated or Non-Designated status under the new criteria. If you have not completed this self-declaration yet, it is worth doing without delay, since it affects your ability to access an EE Compliance Certificate.
Not Sure Which Category You Fall Into?
Getting this classification wrong can cost you. Elevate Advisory can confirm your status and get your EE Online profile in order. Email us at info@elevateadvisory.co.za.
Frequently Asked Questions
Does my annual turnover affect whether I am a designated employer?
No. Since 2025, designation is based purely on employee headcount. An employer with 50 or more employees is Designated regardless of turnover.
What if my employee count changes during the year?
Keep your EE Online profile up to date and review your Designated or Non-Designated status whenever your headcount changes materially, since it affects your reporting obligations and your ability to obtain a Compliance Certificate.
Do I need to deregister if I no longer qualify as a Designated Employer?
No. Rather use the self-declaration facility on the EE Online portal to update your status. Deregistering can create unnecessary complications when you later need a Compliance Certificate.
Need Clarity?
Download our free Employment Equity Simplified Guide for South African Employers here: Download eBook.
Or contact us at info@elevateadvisory.co.za for assistance.