Update on the Employment Equity Act Amendments

On 28 November 2024, the President of South Africa issued the long-anticipated Proclamation Notice to confirm that the Employment Equity Amendment Act No. 4 of 2022 (EEA Act) will come into effect on 1 January 2025.

Here’s a breakdown of the most notable amendments to the EEA Act:

Key Changes to the Definition of a Designated Employer

Employers with fewer than 50 employees, regardless of their turnover, will no longer fall under the definition of a designated employer. These employers will be exempt from submitting Employment Equity reports to the Department of Labour once the amendments are effective. A Designated Employer will now refer exclusively to businesses employing more than 50 employees.

Updated Definition of Disabilities

The definition of "disabilities" has been expanded to include individuals with intellectual or sensory impairments that substantially limit their ability to enter or advance in employment.

Sector-Specific Employment Equity Targets

The Minister of Labour now has the discretion to regulate sector-specific Employment Equity targets. Once finalized, these sectoral targets will require designated employers to review their employment equity plans to align with the published targets and provide reasonable justification if their numerical targets and goals differ from sectoral targets.

Employment Equity Compliance Certificates

Compliance Certificates will now be issued annually, and compliance will be measured against the Sector-Specific Targets. These certificates are mandatory for businesses wanting to conduct transactions with the State. While it’s not yet confirmed, there is a strong possibility that these certificates will also become a requirement to obtain Employment Equity points on a B-BBEE Scorecard.

Criteria for Receiving a Compliance Certificate

The Minister may not issue a certificate if the employer has not complied with applicable numerical targets, fails to provide reasonable grounds for not meeting targets, has not submitted a report as required under Section 21, has been found guilty by the CCMA or a court of unfair discrimination in the last 12 months, or has been issued a CCMA award for failing to pay the minimum wage in the previous 12 months.

Annual Workplace Inspections

Department of Labour inspectors will conduct yearly workplace inspections to assess compliance and issue Certificates to Employers.

Income Differentials Statement Requirement

Every designated employer must submit an income differentials statement to the National Minimum Wage Commission.

Reporting Changes for Employment Equity Submissions

Employment Equity submissions must be reported annually to the Director-General in the prescribed manner. The previous reference to 1 October for submission deadlines has been removed.

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