What employers should know about the new employment equity laws

21 September 2022
South African Accounting Academy

In a media release on 31 August 2022, the Department of Employment and Labour (Department) confirmed that the signing into law of the Employment Equity Amendment Bill, 2020 (the Bill) is imminent. The President is expected to assent to the Bill between now and the end of the year. The amendments are due to come into effect on 1 September 2023.

The following topics are discussed in the article:

Setting of sectoral targets by the minister
Issuance of compliance certificates
Definition of designated employer

The Bill seeks to amend the definition of a “designated employer” by deleting the paragraph which classifies employers with fewer than 50 employees, and who meet the required turnover threshold, as “designated employers.” Consequently, employers who employ fewer than 50 employees, regardless of their turnover, will no longer fall within the definition of a “designated employer” and will therefore not be required to comply with Chapter III of the Act (which deals with affirmative action).
These employers will no longer be required to take certain measures, such as preparing and implementing an employment equity plan, consulting with employees and/or representative trade unions on matters and submitting an employment equity report on an annual basis. According to the memorandum on the objects of the Bill, this is intended to reduce the regulatory burden on small employers.

With the possibility that the President could assent to this Bill as early as September 2022, employers should analyse their existing transformation measures and implement the necessary preparations. Compliance with the amendments, as soon as they are enforced, will be vital for businesses, since fines of between R1.5-million and R2.7-million may be imposed for a contravention of the Act.

Click here to access the Article for more detail:

https://www.bizcommunity.com/Article/196/820/231229.html

Relevance to Auditors, Independent Reviewers & Accountants:

The Employment Equity Act is yet another piece of legislation that your clients must comply with, and which you must assess compliance with. If they don’t comply with the relevant laws and regulations, you have certain reporting obligations in terms of NOCLAR (NOn-Compliance with Laws And Regulations) – this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.
As a designated employer, you also need to comply with the Employment Equity Act in your workplace.
It is therefore vital that you stay up-to-date with the latest developments as set out in the Employment Equity Amendment Bill – especially where important aspects like definitions undergo major changes.

Relevance to Your clients:

A designated employer (individual, company or close corporation) has a duty to comply with the Employment Equity Act, otherwise they could be held liable.
It is therefore vital that your clients stay up-to-date with the latest developments as set out in the Employment Equity Amendment Bill – especially where important aspects like definitions undergo major changes.

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