New Employment Equity Bill would require large-scale relocations across SA

13 April 2021

On Tuesday, 13 April 2021, Sakeliga made verbal submissions to the Portfolio Committee on Employment and Labour on the proposed Employment Equity Amendment Bill. The bill empowers the Minister of Labour to prescribe racial demographic employment targets for individual companies to implement at every workplace and at every occupational level, under threat of fines and denial of compliance certificates.

Sakeliga Chief Executive, Piet le Roux, presented three underlying problems with the bill, namely the timing of its introduction; the implications of its vision; and that racial classification is something South Africa ought to be moving away from, not doubling down on.

Fundamentally, Le Roux argued, success for the bill would mean failure for society as a place of human flourishing. “The bill envisions a future where every organisation, at each of its workplaces, at every occupation level, and in all its teams, reflect the racial demographics of the country, the province or the sector, whichever the Minister picks. Any deviation from this standard is considered by the bill to be an affront and subject to remedy by the state, under penalty of fines or worse.”

“The problem with this vision is that it can only be achieved by limiting employment opportunities for some people in those areas where they are ‘over-represented’ and requiring them by whatever direct or indirect means to seek employment in other parts of the country where that racial category is ‘under-represented’. This would constitute a new kind of migrant labour system, with detrimental effect on the stability and vitality of concrete communities in all racial groups from which its members would have to emigrate to suit the bill’s vision. We are speaking about millions of people from all race groups having to relocate if ever the bill is to achieve what it seeks. Fortunately, such sweeping visions are not easily realised, but this does not detract from the underlying harm of the bill in so far as it implemented.”

Le Roux added that the bill also does not deal with the reality that the pool of skills from which employers may wish to draw does not reflect the racial demographics of the country. “The way to remedy this is not to ignore the variance, but to commit to the sustained educational and training efforts by which all such variance over time incrementally can change and does change and has changed.”

As a matter of timing, Le Roux noted that with South Africa’s poor economic growth in the context of the COVID-19 lockdown, now is the worst time to introduce more red tape into the economy.

Concluding his remarks, Le Roux argued that racial quotas are unconstitutional and incompatible with the founding value of non-racialism in the Constitution, and also incompatible with constitutional intention. “The Constitution only refers to broad demographic representation (which is not the same as narrow racial representation) as regards the public sector,” noted Le Roux, “but makes no reference to the private sector.”

Martin van Staden, Legal Fellow at Sakeliga, presented three technical problems with the bill, namely that it allows the Minister of Labour to make rules for himself; that an unacceptably wide ministerial discretion is being granted; and that either there was no impact assessment conducted on the bill or one was conducted and not published.

The bill empowers the Minister to prescribe the criteria that the Minister must comply with when he identifies economic sectors to set racial-representative targets for. “We cannot have people making the rules they themselves must comply with”, noted Van Staden. “Parliament must set the criteria in the legislation.”

On a related issue, the bill bestows wide discretion on the Minister to decide whether to grant a certificate of compliance with these targets to a business. Van Staden argued that “the Minister’s ‘satisfaction’ is an insufficient legal control on a discretionary power”, and that this “unqualified discretion” would be incompatible with the Rule of Law, which requires Parliament to make the law with which South Africans comply, not ministers.

Van Staden concluded by pointing out the concerning absence of a socio-economic impact assessment on the bill. This contravenes a 2015 government policy that all new policies, regulations, and legislation proposed by government departments would be accompanied by such an assessment.

Van Staden said: “Without an impact assessment having been published, the legislative process is incomplete and out of order. An impact assessment should be conducted and published, and public participation should restart anew.”

Without Parliament having familiarised itself with the likely consequences of that bill, it risks undermining the growth and employment prospects of South Africa.

Both Le Roux and Van Staden’s remarks were based on and added to Sakeliga’s written submission on the bill, which may be obtained here.

Issued by Piet le Roux, CEO, Sakeliga, 13 April 2021