In the last 2 years we have seen a significant increase in the Department of Labour’s Employment Equity compliance audits taking place. We have been in a fortunate position to assist a number of clients in navigating through this process, which clearly anyone would view as stressful.
In some of the recent audits, it was once again emphasised that there are a number of more important aspects to focus on and get in place to avoid any penalties. We only want to highlight 7 of them.
A (1) current (2) Employment Equity Plan
In two recent audits, the inspectors shared with us that failure to have a current Employment Equity Plan (EE Plan) in place, will result in immediate referral to the Labour Court for enforcement due to non-compliance with the Employment Equity Act (EEA) section(s) 20 and23 respectively.
What is vital to highlight is that your EE Plan must indicate the strategies the organisation will adopt in aiming to achieve a more equitably represented workforce in terms of the Economically Active Population’ statistics. Applying the SMART principle in setting your numerical goals and targets, as well as in terms of identifying and eliminating barriers are a must! This can only be done by doing a (3) section 19 Analysis to identify the current status of the company and what we should project for and aim to achieve.
(4) Annual Reporting
Equally so, failure to submit an Annual Employment Equity Report (EE Report), will have the same dire consequences, being non-compliant with section 21 of the EEA. Every year a designated employer must (based on meaningful consultation and implementation of the EE Plan), report on their progress made in terms of the objectives set. During a DoL audit, your organisation’s “performance” will be scrutinised over the past 3 years. In other words, what progress have you made year on year?
Non-compliance in terms of section 20, 21 or 23 (with no previous contraventions); could result in a fine of the greater of R1 500 000 or 2% of the employer’s turnover.
(5) Meaningful Consultation
Consider the fact, that even though you might have an EE Plan in place and even though you might be submitting an Annual EE Report; has there been meaningful consultation regarding the plan, it’s implementation and monitoring of progress made? The dire consequences of not engaging your committee in meaningful consultation regarding your plan is obvious. Failure/refusal to comply with section 17 could result in a fine of R1 500 000 (with no previous contraventions).
Meaningful consultation with an (6) equitably represented forum (compliance with section 16), regarding the company’s EE Plan (including strategic objectives in order to achieve numerical goals and targets, etc.) is NON-NEGIOTIABLE.
After all how valid is an Employment Equity Plan, if there was no consultation? A designated employer must be able to prove that it has engaged in meaningful consultation. Equally of importance, a designated employer must be able to provide proof of regular consultative meetings, as well as proof of the measures taken to identify and eliminate any possible barriers for advancement of designated groups.
(7) Appointing a senior responsible manager
As a designated employer, it is critical to take Employment Equity serious. Not just because of the risk of being fined, but also more importantly to be able to show progress in creating change and advancing previously disadvantaged groups. It is therefore another compliance requirement (section 24) that the company must appoint one or more senior managers to take responsibility for monitoring and implementing the EE Plan.
The above cannot be achieved without investing in training your EE/Training Committee. Your committee must be informed and have the necessary understanding in order to engage in meaningful consultation. They must understand their role and responsibilities.
Another aspect to consider is that failing to take Employment Equity seriously, will have a direct impact on your company’s B-BBEE score, as Employment Equity and Skills Development work hand-in-hand. B-BBEE is of course a topic for another day.
We invite you to engage with us to assist you in terms of the requirements of the EE Act and Skills Development.
Remember your Employment Equity Report must be submitted by midnight on the 15th of January 2019.
Hannetjie Hock – EE/SD Consultant
Bruniquel & Associates (Pty) Ltd.
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