The Portfolio Committee on Labour, having conducted the hearings and having noted the presentations and submissions made to it, reports as follows:

1. Monitor progress and establish problems in the implementation of the Employment Equity Act (Act No 55 of 1998).
2. Assist in formulating proposals which may assist in developing a way forward.
3. Determine the level of compliance and non-compliance by the designated employers.
4. Fulfil its mandate of overseeing the Department of Labour (DOL) and statutory bodies that fall within its portfolio.
5. Determine whether policy developments take place in accordance with the key objectives and aims as stated in the 15-point plan of the DOL.

• Mr James January
• Black Management Forum
• Centre for International and Comparative Labour and Social Security Studies (University of Stellenbosch)

• Commission on Employment Equity (2001/2002 annual report)
• Commission on Gender Equality (report)
• Community Constituency (Nedlac)
• Chinese Association of South Africa
• Chung Wah Youth Association
• Disabled People of South Africa (DPSA)
• Foundation for African Business and Consumer Services (Fabcos)
• Gender Equity Unit (University of the Western Cape)
• Solidarity Union
• Mr Issac Swafo
• Tigers Sports Association
• Ukukhanya Organisation for the Unemployed.

• Commission on Employment Equity (CEE)
• Commission on Gender Equality (CGE)
• Black Management Forum (BMF)
• Commission for Conciliation, Mediation and Arbitration (CCMA)
• Chinese Association of South Africa (CASA)
• Gender Equity Unit (UWC)
• Fabcos (Western Cape)
• Solidarity Union (SU)
• DPSA.

• implementation matters
• awareness, advocacy and training
• enforcement matters
• capacity, technology application and legislative links
• social partners, community partnership and dialogue
• CEE matters.

(1) Implementation matters

The Committee sought clarity on whether employment equity plans were supported by company policies, and whether the information on employment equity, which were collected through organisational audits, were used by the Setas. Some employers used the inadequate levels of skills or management capacity as a reason for failing to comply with the Act. Such employees should be capacitated. Employers should engage consultants and other stakeholders to train them on the reporting requirements of the Act.

Clarity was also sought on the verification procedure used by the DOL to ensure that employment equity committees are in place. External participants should be engaged to facilitate workplace employment equity forums.

The Committee noted the considerable progress made by the public sector employers in implementing the Employment Equity Act as an instrument of social transformation. An appeal was made for urgent action in response to low levels of compliance in the private sector, particularly at top and senior management level.

The Committee enquired whether there was any appreciable improvement in respect of the income differential between the designated and non-designated groups. It was noted that the latter was not covered by the report of the CEE. A proposal was made that the CEE approach the ECC to consider releasing information on income differentials to coincide with the CEE report.

The Committee questioned the rationale behind the inclusion of White females in the definition of designated groups on the basis that they could not be equated with women from other populations. The reason was that they had benefited from access to education and training in the previous dispensation.

The Committee expressed the view that there was a need to implement employment equity in the Seta learnerships. It was also felt that the DOL, being the major partner in the implementation of this legislation, should be engaged in this regard.

More clarity was sought on the reasons for termination of employment. The Committee was of the view that this area had not been covered comprehensively in the CEE's report. It was suggested that this matter be reflected in the next report of the CEE. The CEE agreed that further investigations would be launched to establish whether there were additional reasons for the termination of employment.

(2) Awareness, advocacy and training

The Committee was concerned that information on employment equity was not reaching the smaller and non-designated employers, and the unemployed. It was suggested that greater public awareness should be achieved on codes of good practice and technical assistance guidelines, especially those in the employment of people with disabilities and on sexual harassment.

Clarity was sought on measures used to empower the unemployed and designated groups in respect of the implications of the Act for the recruitment new employees. The Committee also noted that the slow progress in respect of employment equity was resulting on resignations. The DOL advised that an aggressive campaign to familiarise all parties concerned with the requirements of the Act would be embarked upon..

It was suggested that the DOL conduct talks on the codes of practice as part of an advocacy campaign.

(3) Enforcement

A concern was expressed at the non-availability of enforcement measures taken by the DOL. There was a need to improve enforcement processes and procedures, and cases brought to the Labour Court had to make enforcement visible. It was also suggested that the schedule of fines be revised and be linked to inflation. The databases of the DOL, the CCMA, the Labour Court and the CGE should be linked in order to improve the monitoring efforts. A suggestion was also made to link employment equity with state procurement as a way of increasing the enforcement capacity. The higher education sector could be targeted for enforcement, with particular attention to the lack of gender representation at higher levels.

(4) Capacity, technological application and legislative links

The Committee expressed the view that the universe of designated employers had not yet been established for employment equity. It was proposed that the DOL address the latter. Clarity was sought on the strategy used to promote employment equity imperatives in the employer category of 50 or less. In order to qualify for the public sector procurement tenders, many employers in that category had chosen to participate in the employment equity process out of expediency. In addition, since the inspectorate collects information on employer practices across the spectrum, regardless of the size of each organisation concerned, many employers in the category required by law to comply with the Act were already being monitored.

Clarity was sought on the link between employment equity and skills development. The Committee was advised that the DOL is required to facilitate the employment equity and skills development programmes in such way that opportunities for linkages are optimised. The Commission was currently working on the skills development code of practice.

The Committee suggested that the linkage between the Skills Development Act and the Employment Equity Acts needed to be enhanced.

(5) Matters pertaining to the CEE

Role of the CEE

The Committee noted a concern raised by one of the participants on the role of the CEE. A need was therefore identified to profile the CEE and its work in order to rectify misconceptions in respect of its mandate, which is primarily to advise the Minister of Labour. Consultation between the CEE, BMF, CGE and DOL was proposed.

(6) Employment Equity Awards

The Committee was informed about the proposed award system. The DOL was cautioned that although such a system could serve as an incentive for compliance, it might be interpreted by some as an acknowledgement of failure to enforce compliance and an attempt at appeasement. The Committee was advised that provisions for an award system had been included in the Act, and formed part of the programme of work of the CEE. The existing business excellence awards tended not include compliance with the Act as a qualifying criterion. However, the envisaged award system would be different in this regard. The DOL further noted that in future, the annual reports on employment equity would provide employers with an opportunity to articulate their concerns about the constraints faced by business in complying with the Act. These would be used in developing an appropriate award system.

A proposal was made that norms and benchmarks are required to give employers more concrete direction. It was suggested therefore that the CEE should develop those norms and benchmarks.

(7) Amendments to the Employment Equity Act

Issues to be covered by amendments to the Act were as follows:

• Definition of the designated groups
• Unintended consequences on non-designated groups
• Adequacy of provisions in achieving the purpose of the Act.

(8) Amendments to the Regulations

Issues to be covered by amendments to the Regulations were as follows:

• Review of EEA2 forms to provide a classification for Chinese or other groups not listed.
• Review of EEA2 forms to include reasons for terminations.
• Review of EEA2 forms to link with production levels in order to measure impact of employment equity on production.
• Develop an instrument for employer self-evaluation and monitoring.

This was mentioned as part of identifying problems experienced by the employers in the implementation of the legislation. The CEE initiated site visits to selected employers. These visits will also inform the process of reviewing the Act and administrative regulations.

(9) CEE annual report

A request was made for information on the income differential to be made available at the same time when the annual report of the CEE became available. The CEE should consider devoting a section of the annual report to issues surrounding gender mainstreaming. It was also suggested that the CEE's report should not only provide statistical data, but also report on problems encountered with the implementation of the relevant legislation.

(10) Wider social developments

Part of the deliberations during the hearings brought to light certain developments in wider society that impinge on the implementation of the Employment Equity Act. These included state procurement processes, Black economic empowerment initiatives and, in particular, the proposed Broad-Based Black Empowerment Bill.

Submissions received:

1. BMF
1. Labour inspectors are not sufficiently visible.
2. The verification of claims made in EE reports was inadequate.
3. There was an unwillingness to build capacity in the DOL for monitoring EE processes.
4. There has been no significant change in the profile of employment by race, gender and persons with disabilities due to the lack of proper monitoring mechanisms.
5. The focus of monitoring is on numbers and not on individuals.
6. There is lack of compliance by the private sector.
7. The status of EE managers is ignored.
8. Consultative committees do not exist or are not effective in their role.

1. The DOL should establish an action plan to assess employer progress in EE.
2. Punitive measures must be instituted against an employer who violates the Act.
3. Fines should be indexed to inflation and imposed upon employers not complying with the Act.
4. The BEE Advisory Board should serve as the watchdog over BEE and EE.
5. The current CEE should be dissolved as it failed to deliver on its mandate.
6. Employers should measure performance in EE matters.
7. The DOL should develop good practice guidelines on human resources policies and practices and introduce EE awards.
8. The DOL should consider improving the visibility of enforcement efforts and extend its capacity in order to link with state procurement.

1. CCMA

The number of discrimination cases brought to the CCMA in terms of the Act had increased.

Proposal

The CCMA case system could be linked to the Labour Court system.

2. Chinese Association of South Africa
1. The Chinese are not included in the definition of designated groups, and are excluded from affirmative action measures.
2. The Chinese tend to be overlooked by employers complying with the Act not only as work-seekers but also as candidates for staff development and promotion.

Proposal

An amendment should be drafted into the Act that would ensure the recognition of the Chinese of South Africa as being historically disadvantaged.

3. Fabcos

The submission by Fabcos referred to statistical evidence and showed the need to implement the provisions of the Act more aggressively in order to address historical imbalances in the workplace.

4. Gender Equity Unit (UWC)
1. There is slow response in the higher education sector to improve the position of women in the workplace.
2. Women are not represented in senior decision-making positions of the institutions.
3. Labour laws and education laws have different approaches, which make it difficult to align and implement EE successfully.
4. Access to education is still a critical problem, especially for Black women.

 

Proposal

1. The introduction of Women and Gender Studies by various universities should be expanded in an attempt to help promote mainstream gender issues.
2. The higher education sector should be targeted for inspection.

(c) The CEE should consider devoting a section of its annual report to this sector.

5. Commission on Gender Equity

Employers do not always monitor and evaluate whether targets and policies have been implemented.

Proposals

(a) Companies need to develop gender policies.

(b) The roles of the chief executive officer, the DOL and management need to be clarified, and key performance areas need to be introduced for each role. The CEE should introduce an annual report card as a public sector monitoring instrument.

(c) The link between cases brought to the CGE and to the CCMA needs to be formalised.

(d) Human resource planning should include promotions.

(e) Jobs should be created in terms of its context and value. Skills needed to be assessed in an objective manner.

(f) There is a need to develop sexual harassment policies in the workplace.

(g) Companies should report to the CEE on how they have implemented the Act in order to allow for proper monitoring.

6. Community Constituency
1. Community groups are not represented in provincial skills forums and Setas.
2. Government, the DOL and business need to develop a clear protocol that would ensure participation of designated groups in strategic projects.
3. Training projects for employees and employers should be implemented by trade unions.
4. An advocacy programme for the Code of Good Practice on the Employment of People with Disabilities is needed.
5. The DOL should engage in an advocacy to encourage employers to recruit people with disabilities.
6. A wage subsidy scheme needs revision to support programmes for reasonable accommodation.
7. Technical Assistance Guidelines for the Disabled should be finalised and publicised.
8. Setas should review EE policies and programmes, and evaluate the representation of designated groups.
9. The capacity of staff in the Directorate: Employment Services within the DOL needs to be reviewed.
10. An audit on the impact of public works programmes on beneficiaries, especially people with disabilities, should be conducted.
7. Disabled People of South Africa
1. Disability issues are not receiving the priority they deserve.
2. Research indicates a drop in the employment of people with disabilities.

Proposals

(a) Trade unions should raise issues of disability and accommodation at collective bargaining.

(b) A campaign needs to be embarked upon to change mindsets on and traditional stereotyping of disability.

(c) There is a need to develop a database of service providers for equipment and tools of trade for people with disabilities.

(d) Employers should use international standards to guide them on disability issues.

(e) Skills training should be made accessible to people with disabilities.

(f) Learnership programmes should provide employment opportunities for people with disabilities.

8. Solidarity Union

(a) The people responsible for the implementation of EE are top white male managers. It therefore becomes difficult for the to implement a policy that is going to affect them negatively.

1. There is a barrier to the recruitment and promotion of non-designated groups by employers.
2. There are deliberate attempts to create an unfriendly work climate for non-designated groups, which encourage them to resign.
3. The appointment of non-South Africans who are considered as belonging to the designated groups.
4. There is a reduction in productivity and an unwillingness to train others by the non-designated groups due to job uncertainty and insecurity.

1. An equality accord or social contract between the non-designated groups is crucial for South Africa. The Malaysian model can be used in this regard.
2. There needs to be a balance between legitimate rights of the designated groups and that of the non-designated groups.
3. Targets should be set for Whites at lower occupational levels, including entry levels and first time employees.

3. Findings and Recommendations of the Committee
1. The hearings on EE have dispelled false impressions that people lose their jobs as a result of skin colour.
2. The Committee need to develop a strategy to improve the implementation of affirmative action within the context of Employment Equity Act (EEA) Skills Development Act (SDA), Labour Relations Act (LRA) and the Constitution.