Employment Equity Hearings: consideration

Meeting report

LABOUR PORTFOLIO COMMITTEE
5 August 2003
EMPLOYMENT EQUITY HEARINGS: CONSIDERATION

Chairperson (acting): MR D Olifant (ANC)

RELEVANT DOCUMENTS:
Amended Employment Equity Report (Appendix)
Solidarity Union submission

SUMMARY
The Committee discussed the report on the public hearings on Employment Equity held on 13 and 14 May 2003. Concern was raised regarding the presentation by the Solidarity Union and the Committee was particularly vocal in its disagreement. Members felt that the Solidarity Union proposal should be rejected as it defeated the purpose of the Labour Relations Act, the Employment Equity Act, Skills Development Act and the Constitution.

MINUTES
Mr Olifant (ANC) acting Chair, referred to the report on the public hearings on Employment Equity held on 13 and 14 May 2003, saying that the document needed to be deliberated on.

Mr Mshudulu (ANC) raised a concern regarding the presentation by the Solidarity Union (SU) and said that the Committee was particularly vocal in its disagreement with the address. He said that the intention of Employment Equity was to address the imbalances of the past and thereby not exclude any group. He said that the Committee could not understand who the SU was representing as EE did not implement racial divisions.

The Chair commented that the proposition almost implied that the status quo should remain. The attempt to discriminate was unacceptable because it prevented that imbalances be corrected. He said that if the proposition was allowed, it would undermine the South African government.

Mr Radcliffe (DA) pointed out that the proposition merely dealt with findings and recommendations, and that the debate should be for all parties to express their views on the presentations. The propositions were that of organisations and not the Committee.

The Chair said that the Committee dealt with the report and set recommendations, as only these were taken into account for adoption by Parliament. The Committee reserved the right to accept or reject certain things.

Mr Pillay (DA) expressed concern about the SU’s implication that the damage caused by inequality in the workplace could be resolved in ten years. Attempts at implementing affirmative action were sabotaged and that the imbalances still existed. He said that the proposal should be rejected.

Mr Moropa ((ANC) said that purpose was not to formulate policy. He agreed with sentiments expressed by Members and said that the SU had misunderstood what was meant by progress on employment equity and affirmative action. White males in top positions were responsible for the implementation of EE and that it was difficult to formulate policy that would disadvantage them.

Mr Radcliffe said that the issue was the definition of affirmative action. He referred to a statement made by Mr James January, who said that, as a coloured person, the generic term "black" did not apply to him.

The Chair said that it remained a criminal offence and an abuse of human rights to say that an individual was not "black" enough to apply for any particular job.

Mr Radcliffe referred to paragraph 2 and suggested that it should read "ways to implement" and not "ways to accelerate".

The Chair argued that the provisions of the Act were being implemented and it was merely required that the implementation be accelerated. The current set-up saw the deliberate retardation of the process.

Mr Radcliffe wanted clarity on whether the legislation was to be amended. The Chair replied that problems within the legislation were being addressed and that legislation would categorically not be amended.

Mr Lebuthanu (Department) pointed out that in terms of the Act, only reports and not plans were required from employers. Issues pertaining to employers with less than 50 employees were dealt with in Chapter 4.

The Chair mentioned that the strategies devised were based on the limit of internal resources to deal with those employers with less than 50 employees. Discrimination resulted in a transgression of the law.

Mr Mzondeki (ANC) said that the above-mentioned employers would raise certain issues regarding resources for which the Department should address, engage and formulate strategies.

Mr Lebuthanu said that inspectors would demand plans from employers to determine future direction regarding their business concerns.

Mr Mshudulu commented that training in the workplace should include employment equity issues to increase awareness.

Mr Mzondeki said that stake-holders must assist in the Department in promoting awareness campaigns already in place.

Mr Moropa said that the unions did not play a role in this area and this was a problem for the Committee as awareness campaigns did not make a significant impact.

The Chairperson then suggested that recommendations 5, 6 and 7 be combined as they were essentially advocating the same thing. He expressed concern about the Department doing the bulk of the work and said that assistance should also come from within the confines of the workplace.

Mr Mshudulu agreed that the institutional capacity allowed this and pointed out that the Committee should also monitor the process.

Mr Moropa said that the Committee might not be able to adopt Employment Equity as yet. Big employers were not moving in this direction. He proposed that each finding be coupled with a recommendation.

The Chairperson pointed out that they were under pressure to submit the report.

Mr Lebuthanu said that a campaign involving business and labour was planned for the month of August, but that business was stalling and failed to take the effort seriously.

Mr Mzondeki said that which involved technical assistance guidelines (TAG) be expedited by the Department and another tool was necessary for a better understanding as well and promulgation of this code.

Mr Lebuthanu informed the Committee of meetings with the OSDP and DPSA and involving these organisations in marketing TAG. He mentioned a national launch to be followed by provincial launches to ensure that all stake-holders participate.

Mr Pillay (NNP) reiterated that the SU proposal be rejected as it defeated the purpose of the Labour Relations Act, the Employment Equity Act, Skills Development Act and the Constitution.

The Chairperson suggested that the report be adopted on the basis of its recommendations. He reviewed all recommendations made and said that the Committee would meet the following week to further discuss the report.

The meeting was adjourned.

Appendix
Report of the Portfolio Committee on Labour on public hearings on employment equity held on 13 and 14 May 2003

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

A.      Terms of reference

The Committee resolved to conduct the hearings on 13 and 14 May 2003. The objectives of the hearings were to:

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.

The Committee agreed that a report would be compiled and tabled in Parliament after all the information had been collated and analysed.

B.      Background

The process began by placing an advertisement about the hearings in the media and by sending invitations to various organisations. A time frame was set within which all interested parties had to submit requests to appear before the Committee and or send written submissions to it.

Written submissions were received from the following interested individual stakeholders and organisations:

·     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.

The following organisations appeared before the Committee:

·     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.

Stakeholders from Nedlac included the Community Constituency and Business South Africa (BSA), who represented organised business.

    Introduction

The Committee received a briefing from the CEE on its key achievements and its analysis of employment equity in both the public and the private sector. The presentation was based on the findings of its 2001/2002 annual report.

Representations by the BMF, BSA and FABCOS gave an indication of employment equity in the private sector organisations. 

The CCMA’s presentation focussed on its perspective on the implications of the Employment Equity Act. The CGE based its presentation on research it conducted in 1999, which targeted the private sector. The CGE highlighted a need to develop guidelines based on the Convention on the Elimination of all forms of Discrimination Against Women (CEDAW).

The presentations by the DPSA and the Community Constituency highlighted the involvement of the DPSA in the development of a code of good practice and technical assistance guidelines on the employment of people with disabilities, and the relation between skills development and employment equity.  

A concern was raised about the absence of a presentation or a written submission from the major labour federations; only the SU was present.

The issues raised during the hearings were around the following:

·           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

(a)   Labour inspectors are not sufficiently visible.

(b)  The verification of claims made in EE reports was inadequate.

(c)   There was an unwillingness to build capacity in the DOL for monitoring EE processes.

(d)  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.

(e)   The focus of monitoring is on numbers and not on individuals.

(f)    There is lack of compliance by the private sector.

(g)   The status of EE managers is ignored.

(h)   Consultative committees do not exist or are not effective in their role.

Proposals

(a)   The DOL should establish an action plan to assess employer progress in EE.

(b)  Punitive measures must be instituted against an employer who violates the Act.

(c)   Fines should be indexed to inflation and imposed upon employers not complying with the Act.

(d)  The BEE Advisory Board should serve as the watchdog over BEE and EE.

(e)   The current CEE should be dissolved as it failed to deliver on its mandate.

(f)    Employers should measure performance in EE matters.

(g)   The DOL should develop good practice guidelines on human resources policies and practices and introduce EE awards.

(h)   The DOL should consider improving the visibility of enforcement efforts and extend its capacity in order to link with state procurement.

(2)  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.

(3)  Chinese Association of South Africa

(a)   The Chinese are not included in the definition of designated groups, and are excluded from affirmative action measures.

(b)  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.

(4)  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.

(5)  Gender Equity Unit (UWC)

(a)        There is slow response in the higher education sector to improve the position of women in the workplace.

(b)       Women are not represented in senior decision-making positions of the institutions.

(c)        Labour laws and education laws have different approaches, which make it difficult to align and implement EE successfully.

(d)       Access to education is still a critical problem, especially for Black women.

            Proposal

(a)   The introduction of Women and Gender Studies by various universities should be expanded in an attempt to help promote mainstream gender issues.   

(b)  The higher education sector should be targeted for inspection.

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

(6)  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.

(7)  Community Constituency

(a)   Community groups are not represented in provincial skills forums and Setas.

(b)  Government, the DOL and business need to develop a clear protocol that would ensure participation of designated groups in strategic projects.

(c)   Training projects for employees and employers should be implemented by trade unions.

(d)  An advocacy programme for the Code of Good Practice on the Employment of People with Disabilities is needed. 

(e)   The DOL should engage in an advocacy to encourage employers to recruit people with disabilities.

(f)    A wage subsidy scheme needs revision to support programmes for reasonable accommodation.

(g)   Technical Assistance Guidelines for the Disabled should be finalised and publicised.

(h)   Setas should review EE policies and programmes, and evaluate the representation of designated groups.

(i)    The capacity of staff in the Directorate: Employment Services within the DOL needs to be reviewed.

(j)    An audit on the impact of public works programmes on beneficiaries, especially people with disabilities, should be conducted.

(8)  Disabled People of South Africa

(a)   Disability issues are not receiving the priority they deserve.

(b)  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.

(9)  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.

(a)   There is a barrier to the recruitment and promotion of non-designated groups by employers.

(b)  There are deliberate attempts to create an unfriendly work climate for non-designated groups, which encourage them to resign.

(c)   The appointment of non-South Africans who are considered as belonging to the designated groups.

(d)  There is a reduction in productivity and an unwillingness to train others by the non-designated groups due to job uncertainty and insecurity.

Proposals

(a)   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.

(b)  There needs to be a balance between legitimate rights of the designated groups and that of the non-designated groups.

(c)   Targets should be set for Whites at lower occupational levels, including entry levels and first time employees.

C.          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.

            (3) The DOL has to examine a strategy of addressing employers with less than 50  employees.

(4) Reports were submitted without being informed by policies and budgets to   ensure the implementation of the plan. In future there is a need to look at the system of reviewing employer plans.

(5) In order to assist workers to understand their rights in terms of the EEA, SDA, and LRA.  Stakeholders such as labour and business need to play a role in strengthening the awareness programme that is already in place.

(6) The role of Setas and skills development in the implementation of employment equity needed to be emphasised.

(7) The capacity of the inspectorate is insufficient to meet the demands of the legislation concerned. The matter requires an urgent attention from the DOL.

(8) The DOL should popularize the code of good practise on disability, and the finalisation of technical assistance guidelines be speeded up.

(9) The proposals by the SU be rejected as they are intended to defeat the purpose of the EEA, SDA, LRA and the Constitution.