The government will penalise JSE-listed companies not complying with employment equity targets with a minimum fine of R1.5m, the department of employment and labour has said.
On Friday, the department said it has started inspections of JSE-listed companies.
The department’s chief director for statutory and advocacy services Fikiswa Mncanca-Bede said the government will inspect these companies in the first quarter of the year to monitor compliance with the Employment Equity Act (EEA).
In 2018 the department gave local, publicly traded businesses an opportunity to rectify their employment equity plans. This followed a review by the director-general to test compliance with the EEA.
After the review, an agreement was reached with organisations for the department to come back and assess and review compliance at a later stage.
Law firm Cliffe Dekker Hofmeyr (CDH) says the primary purpose of the EEA is to promote the right to equality, to ensure that all employees receive equal opportunities and that employees are treated well by their employers.
“A core focus of the EEA is the implementation of employment equity and affirmative action to redress the effects of historical discrimination,” says the firm which specialises in employment law.
Government has its focus on larger companies after an amendment to the act in 2022, which now excludes employers who employ fewer than 50 employees, regardless of their annual turnover.
Dis-Chem was criticised recently for placing a moratorium on the appointment of white staff to beef up its employment equity profile.
Deputy director-general for the labour department’s inspection and enforcement service, Aggy Moiloa, says there is little to show in terms of transformation in the workplace.
“Unfortunately, 24 years later, when it comes to the area of employment equity, we have got very little to show in terms of transformation. All of us by choice or by default can be an activist for transformation.”
She said that in the 2021/2022 financial year the level of noncompliance in terms of the Employment Equity Act is at 6% of compliance and 96% for noncompliance.
According to the Commission for Employment Equity (CEE) annual report, the department conducted 860 employment equity inspections nationally for the 2021/22 financial year and 48 companies had complied in the past financial year.
A finding of the report is that in many companies there was no person tasked with implementing, monitoring or evaluation progress in implementing equity targets.
But even as implementation lags where the state would like it to be, the commission did report signs of progress. For example, the CEE report shows a slight increase in female representation at the top management level, resulting in a 1.4% increase from 2019 to 2021.
“Though statistically insignificant, the CEE is encouraged by the increase in the female group representation at the top management level. The gain for the female group has been primarily in the public service over the years while the private sector is rather sluggish.”
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