South African businesses now face a crucial compliance challenge after the Department of Employment and Labour on Tuesday gazetted two sets of Employment Equity (EE) Regulations effective January 1, 2025.
The Department of Employment and Labour said in a statement, “The publication of these EE Regulations represents a pivotal step toward advancing transformation and inclusivity in the South African labour market. Employers are encouraged to familiarise themselves with the new regulatory framework to ensure compliance and alignment with employment equity objectives.”
The regulations mandate designated employers to meet sector-specific equity targets by 2030, with hefty fines for non-compliance. Non-compliance carries penalties of up to R1.5 million or 2% of annual turnover. Over 200 employers have already faced Labour Court for prior violations.
The published regulations include:
- General Administrative Regulations: These regulations provide standardised reporting forms (EEA2 and EEA4 forms); templates for EE Analysis (EEA12) and EE Plans (EEA13); enforcement tools; and templates for the EE Certificate of Compliance, including the intention to withdraw the EE Certificate of Compliance.These regulations offer implementation guidelines to assist employers and employees in interpreting and applying the provisions of the EE Amendment Act, of 2022, including streamlining compliance processes for designated and non-designated employers.
- Regulations on Sector Numerical EE Targets: These Regulations establish the actual five-year sector numerical EE targets for designated groups across 18 economic sectors for the four upper occupational levels (such as top management,senior management, professionally qualified/middle management, and skilled technical/junior management), including for persons with disabilities.
The regulations are expected to have a significant impact on South African businesses. However, many industry stakeholders have raised concerns that the targets are unattainable, citing the current economic climate and South Africa’s low-growth economy as barriers to their achievement.
Jonathan Goldberg, the chairman of Global Business Solutions, said, “The new regulations create both significant challenges and opportunities for South African businesses. While many will find these targets difficult to achieve, those who strategically align their practiceswith these requirements can emerge as leaders in transformation.”
The regulations, following the Employment Equity Amendment Act, No. 4 of 2022, include General Administrative Regulations, providing standardised reporting tools and compliance templates, and Regulations on Sector Numerical EE Targets, setting five-year goals for designated groups across 18 economic sectors at top occupational levels.
Designated employers with 50 or more employees must align their EE plans with these targets to ensure equitable representation.
“The regulations present a complex challenge for many sectors, especially those that arealready facing economic headwinds,” said Thembi Chagonda, Joint-CEO of Global Business Solutions and an Employment Equity Commissioner. “However, those businesses that embrace these changes head-on and innovate their approach to compliance will find themselves better positioned for the future.”
Small employers with fewer than 50 employees are exempt from preparing EE plans and annual reports but are encouraged to remain in the Department’s database for compliance certification.
Labour union Cosatu has prevously said the reforms will help address South Africa’s persistent inequalities and improve compliance with labour laws.
Meanwhile, the Department of Employment and Labour, the Commission for Employment Equity and the Commission for Conciliation Mediation and Arbitration (CCMA) – as part of advocacy initiatives, intend to conduct national workshops/roadshows to engage with various stakeholders in the labour market about the implication(s) of the new legislation.
The 2025 EE workshops will be held under the theme: “Bridging the Equity Gap Through Diversity & Inclusion” . These will be held during May and June 2025 across all nine provinces.
More information on the EE workshops, including updates on the venues to be used, will be available on department’s and the CCMA’s social media platform as well as the Department’s website: www.labour.gov.za
The workshops will focus on:
- How to implement the EE Amendments contained in the EE Amendment Act, 2022 and its EE Regulations?
- Five-year Sector EE targets for 18 economic sectors;
- Practical demonstration of how to utilise the EE system online facilities to capture EE reports and request EE Certificate of Compliance; and
- Presentation on discrimination disputes referred to the CCMA and the various Courts, in particular, harassment cases, including dispute resolution mechanisms in terms of the EEA.
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