Commission for Employment Equity Annual Report 2016 - 2017
The aim of the Employment Equity Act, No 55, 1998 (as amended) is to facilitate workplace transformation. It incorporates two elements: a) the elimination of unfair discrimination and b) the implementation of affirmative action and measures to enable equitable representation of employees from different race, gender and disability groups in the workplace.
The Commission for Employment Equity (CEE) is a statutory body established in terms of Section 28 of the Employment Equity Act, No 55 of 1998 (EEA). The role of the CEE is to advise the Minister of Labour on any matters concerning the Act, including policy recommendations and matters pertaining to the implementation towards achieving the objectives of the EEA. The CEE is required to submit an annual report to the Minister of Labour in terms of Section 33 of the EEA to monitor and evaluate progress towards achieving the objectives of the EEA. This is the 17th annual report submitted to the Minister by the CEE since its first report in 2000.
This report is an analysis of data and information from EE Reports submitted by employers (both designated and those reporting voluntarily) through their annual employment equity reports as required by Section 21 of the Employment Equity Act. These reports were submitted by employers manually and electronically from 1 September 2016 to 15 January 2017 when the EE system officially closes for reporting for a particular year.
The CEE embarked on a number of key initiatives to understand and enhance the pace of transformation in the country. These initiatives are reflected in this 17th Annual Report. The 2016 initiatives by the CEE includes: engagements with stakeholders both strategic partners and representatives from key sectors of the economy; review of the Code of Good Practice on the Employment of Persons with Disabilities and the review of the Code of Good Practice on the Preparation, Implementation and Monitoring of Employment Equity Plans. Included in this report is the latest Economically Active Population (EAP) as published by Statistics South Africa during the third quarter of 2016. The EAP is provided by population group and gender for the national and provincial populations and is used as a benchmark for the setting of numerical goals and targets.
An analysis of the workforce profile for the reporting organisations is presented for all the occupational levels, viz. Top Management, Senior Management, Professionally Qualified, Skilled Technical, Semi-skilled and Unskilled levels. This is in response to an outcry from users to reflect on all the occupational levels and not only concentrate on the top levels. The analysis is according to race, gender and disability status as well as by province, sectors and business type.
The report also provides a workforce profile trend analysis from 2014 to 2016 by race, gender and disability. Also, included in this edition of the CEE Annual Report is the analysis of workforce profile, movements and skills development at universities and universities of technology. This is in response to a request from the higher education sector during the CEE sectoral engagements and in line with the Government’s plan on transformation in the higher education sector.
The activities of the CEE are guided by the key strategic objectives set out by the fourth CEE at the beginning of its term in December 2015. Key activities highlighted for this reporting period include the following:
2.1 REVIEW OF THE TECHNICAL ASSISTANCE GUIDELINES ON THE EMPLOYMENT OF PERSONS WITH DISABILITIES (DISABILITY TAG)
The Technical Assistance Guidelines on the employment of People with Disabilities, which unpacks the Disability Code, was first published in 2003. Following the adoption of the United Nations Convention on the Rights of Persons with Disabilities and the revision of the Code of Good Practice on the Employment of Persons with Disabilities (Disability Code) in 2015, the Disability TAG was aligned accordingly. The Disability TAG unpacks the Disability Code and serves both as a management and a technical tool to guide employers in dealing with disability in the workplace when commencing employment, during employment and when terminating employment.
2.2. REVIEW OF THE CODE OF GOOD PRACTICE ON THE PREPARATION, IMPLEMENTATION AND MONITORING OF THE EMPLOYMENT EQUITY PLAN
With the commencement of the Employment Equity Amendment Act No. 47 of 2013 in August 2014, it became necessary to review all provisions affected by the amendment. One such instrument is the Code of Good Practice on the Preparation, Implementation and Monitoring of the Employment Equity Plan. The draft amended Code was published in the Government Gazette on 30 September 2016 for public comments. The amended Code will be published in the Government Gazette after incorporating the inputs sourced from public comments.
2.3. CEE STAKEHOLDER ENGAGEMENTS
The fourth CEE had planned among its strategic priorities, to engage with stakeholders in order to promote effective implementation of the objectives of the EEA. In discharging this task, the CEE differentiated between strategic and sectoral stakeholders. The mandate of the strategic partners has a bearing on the work that the CEE does. The sectoral stakeholders are those stakeholders responsible for the implementation of the EEA.
2.3.1 CONSULTATION WITH STRATEGIC PARTNERS
The engagement with this category of stakeholders was in order to form strategic partnerships on issues of common interest in realising the aims of the EEA. Among the partners that the CEE met, was the Broad-Based Black Economic (B-BBEE) Commission, the Black Management Forum (BMF), the Commission for Gender Equality (CGE) and the South African Human Rights Commission (SAHRC). The CEE entered into an agreement and signed a memorandum of understanding with the CGE regarding matters of mutual interests.
2.3.2 SECTORAL STAKEHOLDER ENGAGEMENTS
The Commission for Employment Equity embarked on consultative meetings with business leaders from various sectors of the South African economy. The CEE Annual Report constantly pointed to the under-representation of designated groups at the senior and Top Management levels of the workforce, despite them possessing skills to operate in the industry evidenced by the concentration at the Skilled Technical and professionally qualified occupational levels of the workplace.
The aim of the sectoral engagements was to understand and appreciate the issues affecting the implementation of the Employment Equity Act in organisations. The engagements produced vigorous debates from participants and pointed to various factors explaining the continued under-representation of designated groups in decision-making positions in the workplace. Among those mentioned is resistance to change from management in most sectors of the economy, which is characterised by the fixation on the legal compliance on employment equity and a failure to move beyond what is required by law. Businesses were mostly focussed on B-BBEE, which is seen to yield economic benefits, while ignoring the employment equity component of the balanced scorecard. This was because employment equity is not integrated into the overall business strategy, but relegated to human resources, (HR). Sectoral targets were proposed as a solution to this problem.
There were claims of the existence of networks, which dictate who is recruited and promoted in organisations which was also a major challenge. This meant designated groups, especially Black (African) people were not being exposed to such opportunities ensuring their readiness for operating at higher levels despite having the necessary qualifications. Income disparities on employees in the same positions also came up during the engagements despite the promulgation of the Equal Pay for Work of Equal Value provisions in the Employment Equity Amendment Act in 2014, which perpetuate income inequality.
2.4. PROMULGATION OF SECTION 53 OF THE EMPLOYMENT EQUITY ACT (STATE CONTRACTS)
The consolidation of 23 years of democracy and 21 years of the Constitution of the Republic of South Africa entrenched the need to eradicate social and economic inequalities, particularly those that stem from our history of Colonialism, Apartheid and Patriarchy, which brought inequality to the great majority of our people, in particular Black people, Women and Persons with Disabilities.
It is well known that Colonialism, Apartheid and Patriarchy, have left behind a legacy of inequalities in both the labour market and society as a whole. In the labour market, the disparity in the distribution of jobs, occupations and incomes, reveals the effects of discrimination against Black people, Women and Persons with Disabilities.
It is therefore submitted that prohibition of unfair discrimination and the commitment to the implementation of affirmative action measures are mutually reinforcing processes required to achieve “substantive equality” in order to give effect to the right to equality as enshrined in Section 9 of the Constitution of the Republic of South Africa (Constitution).
Section 9(2) of the Constitution, the equality clause reads as follows:
‘Equality includes the full and equal enjoyment of all rights and freedoms. To promote the achievement of equality, legislative and other measures designed to protect or advance persons or categories of persons, disadvantaged by unfair discrimination may be taken.’
It is against this backdrop that the Employment Equity Act (EEA), 1998 was enacted followed by other pieces of transformation legislation such as the Skills Development Act and the Broad Based Black Economic Empowerment Act to give effect to section 9(2) of the Constitution.
However, it is known that despite the comprehensive legal framework in place and the consolidation of 19 years of the EEA, the pace of transformation has been slow. Some key contributors to this slow pace, include implementation challenges such as resistance by a number of employers to embrace employment equity to transform their various workplaces; employment equity not yet being recognised by a number of employers as a business imperative and not yet integrated into business strategies and plans to promote equity; absence of prescribed EE targets/ EE benchmarks to be met by various employers in various sectors to ensure that there is equity in their various workplaces; and inadequate monitoring of compliance by employees and trade unions in relation to the implementation of the agreed EE targets set by employers in the EE plans.
Notably, stakeholders that participated in the Commission for Employment Equity Sectoral Engagements held between June and September 2016, called or requested the setting of Sectoral EE targets as benchmarks and the promulgation of Section 53 of the EEA to trigger financial consequences for non-compliance and as a result, expedite transformation and compliance with the EEA.
In light of the slow pace of transformation; implementation challenges of the EEA and absence of financial consequences for non-compliance, the Commission for Employment Equity deemed it urgent to promulgate Section 53 dealing with State Contracts to expedite transformation, increase compliance levels and at the same time trigger financial consequences for non-compliance with the EEA.
Section 53 of the EEA states that:
53. (1) Every employer that makes an offer to conclude an agreement with any organ of state for the furnishing of supplies or services to that organ of state or for the hiring or letting of anything.
(i) If it is a designated employer, comply with Chapter II and III of this Act, or
(ii) If it is not a designated employer, comply with Chapter II of this Act; and
(b) attach to that offer either-
(i) a certificate in terms of subsection (2) which is conclusive evidence that the employer complies with the relevant Chapters of this Act; or
(ii) a declaration by the employer that it complies with the relevant Chapters of this Act, which when verified by the Director-General, is conclusive evidence of compliance.
(2) An employer referred to in subsection (1) may request a certificate from the Minister confirming it compliance with Chapter II, or Chapters II and III, as the case may be.
(3) A certificate issued in terms of subsection (2) is valid for 12 months from the date of issue or until the next date on which the employer is obliged to submit a report in terms of section 21, whichever period is longer.
(4) A failure to comply with the relevant provisions of this Act is sufficient ground for rejection of any offer to conclude an agreement referred to in subsection (1) or for cancellation of the agreement.
(5) The Minister may in the code of good practice set out factors that must be taken into account by any person assessing whether an employer complies with Chapter II or Chapters II and III.
It is noteworthy to highlight that the linking of EE compliance certificates with access to procurement opportunities available within the State is in-line with the international trends that are currently emerging and shared by a number of countries at the United Nations Commission on Status of Women (CSW61) held in March 2017. The linking of Certificates of Compliance for access to State Contracts is seen as a key Government policy intervention to accelerate gender equality and economic empowerment for women to achieve the Sustainable Development Goals, which are central to the United Nations 2030 Agenda.
Section 53 of the EEA deals with issuing of compliance certificates to employers who intend or do business with government. This section has never been promulgated since the inception of the Act. In line with the request made at the sectoral engagements conducted by the CEE, the Commission is looking at setting sectoral targets for the various sectors. These will assist in determining compliance, which will then be used as a basis for the issuing of compliance certificates for those employers who want to do business with Government.
6. CONCLUDING REMARKS
PROFILE AT TOP MANAGEMENT LEVEL IN TERMS OF RACE, GENDER AND DISABILITY BY PROVINCE, SECTOR AND BUSINESS TYPE
At Top Management Level, White group representation (68.5%) continues to dominate, followed by the Indian group (8.9%) compared to their EAP distribution. An emerging trend in the increase in employment of Foreign Nationals (3.5%) at this level, is noted, particularly in the Private Sector. This trend analysis has to be interpreted and compared to the increase in multinational operations in the country. Female representation at Top Management level has remained largely unchanged at just over 20% for the last three reporting periods. This remains a concern for the CEE because an equitable representation of women at this strategic decision making level at this rate is likely to have an adverse effect on the equitable representation of women at every other occupational level.
Comparing the representation of all population groups at this level, it is apparent that representation of the White group dominates representation at this level in all provinces. The highest representation of this group is noted in the Western Cape (76.6%) and in the Free State (72,1%). The CEE notes that the White Female group represent more than the combined number of other designated Female groups at this level across all Provinces. This trend is indicated in all Sectors of the economy as well.
Further analysis into the level in terms of various business types, indicates that the representation of the White population group has remained largely dominant at this level for the Private Sector as well as for the Educational Institutions. The continued high rate at which the White group appears to be afforded preferential treatment for recruitment, promotion and training opportunities at this level is of concern. This trend renders it highly unlikely to achieve equitable representation at this level in the near future.
PROFILE AT SENIOR MANAGEMENT LEVEL IN TERMS OF RACE, GENDER AND DISABILITY BY PROVINCE, SECTOR AND BUSINESS TYPE
At Senior Management Level, the White group (58.1%) remains the majority representation at this level, followed by the Indian group (10.6%) when compared to the EAP distribution. The trend in the increasing levels of representation of Foreign Nationals (3.1%) at this level remains the same as at all other levels and it is particularly noticeable in the Private Sector. Female representation at this level remained largely unchanged at just above 30% for the past three reporting periods. Equitable representation of women at this strategic decision making level is highly unlikely given this trend.
Again at this level, it is apparent that the majority representation of the White group is prevalent in all provinces. The CEE notes that at this level too, White Females representation is more than the total level of representation of other designated Female groups in almost all provinces.
A similar scenario is detected when viewing the representation at Senior Management Level in relation to the White groups in all sectors of the economy and business types, in particular, the Private Sector and Educational Institutions. This trend of clear preference manifests in the recruitment and promotion patterns adopted, especially by the Private Sector.
PROFILE AT PROFESSIONALLY QUALIFIED/MIDDLE MANAGEMENT LEVEL IN TERMS OF RACE, GENDER AND DISABILITY BY PROVINCE, SECTOR AND BUSINESS TYPE
A positive trend towards equitable representation is noted for the first time at Professionally Qualified/ Middle Management Level. The CEE interprets this trend as positive towards reaching an equitable representation at Senior Management Level as this level serves as a feeder to Senior Management level.
Gender representation between male and female groups appear to be somewhat more closely aligned to the EAP distribution and this trend is likely to be maintained. The trend is also evident in provinces and across all economic sectors.
PROFILE AT SKILLED TECHNICAL/JUNIOR MANAGEMENT LEVEL IN TERMS OF RACE, GENDER AND DISABILITY BY PROVINCE, SECTOR AND BUSINESS TYPE
At Skilled Technical/Junior Management Level, a positive move towards equitable representation across all population groups in relation to the EAP distribution is noted.
The drastic increase in the representation of Foreign Nationals representation 2014 to 2016 at this level needs further analysis. The CEE is concerned that this trend is contrary to employment legislation seeking to govern migrant labour and employment regulations, such as skills transfer programmes.
PROFILE AT SEMI-SKILLED AND UNSKILLED LEVELS IN TERMS OF RACE, GENDER AND DISABILITY BY PROVINCE, SECTOR AND BUSINESS TYPE
At Semi-Skilled Level, the Black group, in particular Africans and Coloureds, accounts for the highest representation. This is interpreted with full cognisance of the history of South Africa and the objectives of Equity legislation. The representation of women at this level still needs improvement towards equal access to employment opportunities and representation in the workplace.
PROFILE AT UNSKILLED LEVEL IN TERMS OF RACE, GENDER, DISABILITY AND BY PROVINCE, SECTOR AND BUSINESS TYPE
The observations made in relation to Race and Gender at the Semi-Skilled Level applies at Unskilled Level. The CEE is concerned that the White representation is approximately one-third of their EAP distribution at this level and whether this would impact on this population group accessing entry-level jobs.
The CEE has noted that not only for this reporting period, disability representation across all Occupational Levels remained very low and whether other interventions in terms of the multi-disciplinary approach should be adopted to accelerate the representation of this group in the workforce.
In conclusion, the Employment Equity Reports received from employers for the 2014, 2015 and 2016 reporting periods reflected that Africans continue to occupy the largest portion of the workforce with their representation mainly concentrated at the bottom occupational levels. Whites and Indians accounted for a rather small portion of the workforce over the same period, but their representation continue to dominate at the middle-to-upper occupational levels in terms of their EAP distribution. Foreign Nationals occupy a large part of the workforce, even at the unskilled occupational level and proportionally, the representation of Coloureds at the various occupational levels is not reflective of their EAP distribution.
Males make up majority of the workforce and continue to dominate participation at every occupational level and women continue to encounter the glass-ceiling effect in the workforce. Persons with disabilities over the period showed the need to not only increase their representation at the various occupational levels, but to prioritise participation in the workforce as well.
The workforce profile at the upper echelons in organisations is mainly white and male. This suggests that South African workplaces remain racialized and gendered. The ILO has indicated that, “inequality between women and men persists across a wide spectrum of the global Labour market and that despite their educational attainment; this has not necessarily translated into improvements in their positions at work”. The shift towards equality in this regard continues to grind at a slow pace, which suggests that this will not be reached anytime soon.
The report further cited unequal treatment at work as the biggest problem facing women in paid working developing economies such as South Africa. Equal pay for work of equal value is a case in point. Women are still paid less than men doing the same work. This becomes an impediment to economic empowerment of women.