Report of Commission for Employment Equity again fixates on top management

27 July 2015

Trade union Solidarity today criticised the Commission for Employment Equity’s latest report, saying that like in previous years, it fixates on a tiny part of the South African labour force, namely top management. In addition, the Commission’s analysis of the labour market is again seriously flawed, which shows either an inability or an unwillingness to do a proper analysis.

Paul Joubert, senior economic researcher at Solidarity, said that according to the Commission’s own figures, top managers constitute less than 1% of the workforce included in the report. From a total of more than 7 million employees employed by 24 291 employers covered by the report, only 57 901 people are at top management level. This means that on average there are only 2,4 top managers per company.

“The Commission does not at all take into account the fact that the majority of businesses only has one or a handful of top managers. It is unusual for a smallish company with little more than 50 employees to have more than one top manager,” Joubert said.

“Many businesses are run as family businesses, or have been established by a specific entrepreneur who is also the only top manager. Apparently, the Commission expects that such an entrepreneur, if he is white, should replace himself with a black person to “correct” the “representation” of this one person at top management level. The alternative would be that nine additional top managers must be appointed, all of them black. For an Indian entrepreneur the situation is even more absurd, as to reach Indian “representivity” of only 2,8% at top management level in his firm, he would have to appoint 35 additional employees at this level,” Joubert said.

Joubert added that although the Commission has a host of data available to do a comprehensive analysis of the labour market, including all relevant factors, the Commission’s analyses remain flawed and one-sided year after year.

In view of the fact that there are 8,7 million unemployed people in South Africa at the moment, the Commission’s focus on the 57 901 top managers is totally misplaced,” Joubert added.

Dirk Groenewald, Head of Solidarity’s Centre for Fair Labour Practices, Solidarity has repeatedly pointed out that the racial composition of the economically active population is not an appropriate yardstick to measure “representation”. “The statistics on the economically active population do not take the distribution of skills and qualifications into account. In this year’s report, the Commission acknowledges this fact, but nonetheless continues to prescribe the economically active population as the only measure,” Groenewald said.

Solidarity will study the report released on Thursday by the Department of Labour in more detail and will comment further at a later stage.

Statement issued by Paul Joubert, Senior economic researcher: Solidarity Research Institute, July 27 2015