Dis-Chem controversy: IRR renews call on Ramaphosa to veto race law

21 October 2022

In light of the revelation of Dis-Chem’s “moratorium” on hiring “white individuals”, the IRR has written to the Presidency renewing its call on Cyril Ramaphosa to stop the Employment Equity Amendment Bill (EEB) from becoming law.

According to Section 79 of the Constitution, Ramaphosa has the power to block proposed legislation that is unconstitutional. The IRR has submitted to Parliament and the Presidency at least six grounds of unconstitutionality in the case of the EEB. These submissions have been endorsed by more than 23 000 South Africans who support the campaign to block the EEB.

The Dis-Chem controversy brings the EEB back into focus. When Minister of Employment and Labour Thulas Nxesi introduced the EEB in Parliament, he called for “a more aggressive strategy” on race-law implementation, directly before mentioning the EEB. Minister Nxesi’s department subsequently promised that President Ramaphosa would sign the EEB into law by the end of 2022 and that it would be enforced by September 2023. The maximum fine for a re-offence under the EEB is set at 10% of turnover.

When Dis-Chem CEO Ivan Saltzman issued an internal letter placing a “moratorium” on hiring “white individuals”, he said “these harsh measures” are “necessary…to avoid a potential fine of 10% of turnover which could cripple the business. This is a real threat at this stage.”

The IRR’s letter to the Presidency notes that Dis-Chem’s “moratorium” on hiring white individuals “is a specific and concrete manifestation of the inhuman, chilling effect that Minister Nxesi and his department’s actions have had on a particular business. The IRR has reason to believe that this effect is more widespread and underreported than a single case. Gross Fixed Capital Formation is depressed, employment figures are disappointing, as is per capita productivity. ‘More aggressive’ race-law equals more pain for the poor.”

The letter goes on: “However, the President is obliged to revert the Bill to Parliament for amendment not simply because this is popular or good for the economy. The President is obliged to do so because the Bill is unconstitutional. The reasons for this have already been provided in [the IRR’s] previous correspondence as well as submissions to both Parliament and your office.”

In view of this, the IRR “calls upon the President to revert the Bill back to Parliament”.

In a nationwide, demographically representative survey commissioned by the IRR in 2020, Dis-Chem-style anti-white race quotas were supported by roughly 15% of white respondents and opposed by 80% of black respondents. 80% of all respondents of all races preferred job appointments being made on merit.

The EEB that is behind the Dis-Chem-style anti-white race quotas is unconstitutional because it violates the Constitution’s Chapter 1 commitment to non-racialism and, in requiring that Dis-Chem and other companies apply an undefined neo-pencil test, also undermines the Rule of Law. It also violates the Equality Clause of the Bill of Rights. South Africa’s race law is currently under review at the International Labour Organisation.

Issued by Gabriel Crouse, IRR Head of Campaigns, 21 October 2022