Labour Department mulls harsher punishment for non-compliance with employment equity laws

Labour Department mulls harsher punishment for non-compliance with employment equity laws

Labour minister Mildred Oliphant on Tuesday launched the Commission for Employment Equity's annual report‚ which showed that top posts in the country are still held by white men.

“We challenge those who believe that the Employment Equity and affirmative action policies have gone past their sell-by date to read this commission's report carefully and check‚ if in all honesty‚ it is really the time to scrap Employment Equity and affirmative action.

“Do they truly believe that we have achieved what the Employment Equity Act was set out to do?”

“The report once again points to the painfully slow pace of transformation in the South African labour market. It also mirrors the glaring lack of appetite for transformation‚ especially by big corporates.”

To date 21 companies have been fined for non-compliance‚ more than half of which are JSE-listed.

“Commentators ridicule the maximum amount that an offending employer could be fined‚ as too small to be a deterrent‚ as some employers simply budget for this in case they get caught.

Oliphant said employers alone are not responsible for compliance with employment equity laws.

“I strongly believe that there are instances where workers‚ unwittingly add to this problem through complacency.”

She said workers should participate in crafting reports submitted to the department and monitor their employers' compliance.

"Some commentators ridicule the maximum amount that an offending employer could be fined‚ as too small to be a deterrent as some employers simply budget for it just in case they get caught.

"It is this state of affairs that leaves us with no option‚ but to consider‚ drafting-in harsher consequences for non-compliance.

"It’s time to 'up the ante' and this may include promulgating the 'stick' sections of the Employment Equity Act because quite frankly‚ the 'carrot' sections have not delivered the desired results‚" she said.

"We are seriously considering approaching the President to enact the more punitive Sections and Chapters of the EE Act‚ which were‚ initially excluded from the earlier promulgation.

"This will give the Employment Equity Act‚ real teeth and will bite where it hurts the most‚ and that is‚ designated employers’ revenue."

The slow pace of transformation has led to renewed calls for increased punitive action. In 2014, the Employment Equity Act was amended so companies failing to prepare or implement equity plans can be fined up to R2.7-million or 10 percent of turnover for the worst repeat offenders.

During 2016-17, 192 companies were referred for prosecution. Of those:-

• 19 have paid R18.5-million; and
• 79 are not opposing the fines and will have to pay R118.5-million.
• The rest of the transgressors are opposing their cases, involving fines of R135-million.

More punitive action might be needed, said the commission.