Employment Equity Amendment Bill: deliberations

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Employment and Labour

17 June 2021
Chairperson: Ms M Dunjwa (ANC)
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Meeting Summary

Video: Portfolio Committee on Employment and Labour, 17 June 2021

The Portfolio Committee on Employment and Labour met on a virtual platform to discuss the Employment Equity Amendment Bill, led by a parliamentary Legal Advisor and assisted by the Department of Employment and Labour. The intention was to create an A-list of amendments that the Committee would like to make to the Bill. The Committee discussed the Bill clause by clause.

The term “designated employer’’ would be deleted from the Act as such a designation would no longer exist in terms of the Amendments. The section on “voluntary compliance” was repealed as that, too, would not be applicable in the new Act. All employers would have to complete the departmental documentation, although there were only two questions for employers who previously had engaged in voluntary compliance, usually to obtain a B-BBEE certificate for tenders. The date on when compliance documentation was to be submitted would no longer be the first working day in October: the Minister would set the date for submission. The definition of ‘‘people with disabilities’’ would be amended to be brought in line with the description adopted by the United Nations Convention on Disabilities.

A new Section 15A was to be inserted in the Act which gave the Minister the power to set national employment equity targets in any sector. Some Members objected to the clause on the grounds that the section gave the Minister untrammelled discretion and the guiding parameters were not sufficiently clear. In addition, many members of the public who had made submissions had said that it undermined the supremacy of the rule of law. The majority of Members approved the inclusion of the new section as they believed that employers should not have the power to monitor themselves; they had failed in doing so for the past couple of decades. Members also pointed to the fact that NEDLAC had approved the insertion of the clause. As Members justified the need for such legislation and the fact that there were criteria determining the Minister’s decision, it was found that two sub-clauses in 15A contradicted each other, one giving completely untrammelled power to the Minister. That sub-clause was deleted.

Questions were raised in regard to specific terminology, such as how one monitored cases where the Minister had to be “satisfied” or where he recognised “reasonable grounds”. An inclusion brought about by the Amendment was that the records of an employer had to be checked to determine whether any cases had been decided against an employer in the past three years. The entire concept was said to be flawed, considering appeals and reviews but ultimately, the period of a clean record was reduced from three years to 12 months.

Meeting report

Opening remarks

The Chairperson greeted everyone. She spoke of how she had received her vaccine against Covid-19 during the week and how everyone should adhere to the non-medical protocols, especially as lockdown level 3 had been introduced to counteract the third wave of the Covid-19 pandemic. She requested the Secretary to take a roll call.

The Secretary noted the attendance of Members. Ms Sueann Issacs and Adv Nathi Mjenxane, Parliamentary Legal Advisor, represented the Office of Constitutional and Legal Services in Parliament (OCLS). Mr Thembinkosi Mkalipi, Chief Director for Labour Relations, stated that he was representing the Department of Employment and Labour (DEL).

The Chairperson requested that all guests introduce themselves so she knew who was on the platform.

The Chairperson recapped the process that the Bill had followed. Once the Bill had been accepted by Cabinet, it had been sent to the Speaker and had been ‘ATC’d’ (referred) to the Committee. The Department had presented the Amendments to the Committee. The Committee had advertised for public comment in writing. Thereafter, the Committee held oral hearings for the public. The Committee had listened to everyone, after which the Department had clarified the input. She reminded Members that she had requested Members to ask questions of clarity throughout the process.

She explained that the Committee would now be deliberating on the Bill and would go through clause by clause and not jump all over the show. Members had to present their reasons for any proposal made. The Legal Advisors were there to guide Members; they would not interfere with political decisions.  The parliamentary Legal Advisor would take the Committee through the Bill, clause by clause. The Chairperson also asked Ms Isaacs to explain to Members what was meant by an A-list and a B-list. She requested that Ms Isaacs take the Committee through the Bill and advise and caution Members, especially if they seemed to be going overboard. Members did not have to agree with the Legal Advisor’s advice but she would be able to say that she had given the relevant advice.

The Chairperson stated that she had expected the Legal Advisors of DEL would also be in attendance, precisely for that reason.

The Chairperson was distracted by a member of the public who did not introduce himself but who finally introduced himself as a member of the labour forum from Malmesbury.

Briefing by the Legal Advisor

Ms Isaacs informed Members that NA parliamentary rule 286 had been followed to that point and the Committee was currently at the stage of rule 286(6)(d): deliberation by members, taking into consideration proposed amendments and comments and proposals received and evidence presented.

The Committee would be considering the public submissions, the Department’s responses and its own views of the Amendments. The Members could indicate if they wanted to change any of the Amendments and the Committee could come to an informal agreement regarding changes.

Once the Committee had decided on amendments, the process would advance to rule 286(6)(e): formal consideration of the Bill, clause by clause, including amendments as formally proposed. Legal Services would draft an A-List based on all Amendments proposed by the Committee. Once that was done, the Committee would consider adopting the B-Bill; the B-Bill was the Bill that the Committee would consider as it would contain the proposed Amendments.  The process was: deliberations, approval of amendments in the A-List, consideration of the B-Bill and, if approved, B-Bill put forward to the National Assembly.

The Bill before the Committee was the Employment Equity Amendment Bill [B 14—2020] which sought to amend the Employment Equity Act. She suggested that the Members have a copy of both the Bill and the Act before them so that they could see the changes and exactly where those changes fitted into the Act.

Regarding technicalities included, Ms Isaacs explained, as stated on the second page of the Bill: [ ] Words in bold type in square brackets indicate omissions from existing enactments.

 ____________   Words underlined with a solid line indicate insertions in existing enactments.”

The Chairperson asked if all Members had understood everything that the Legal Advisor had explained. It was important that everyone had copies of the Bill.

Presentation of Employment Equity Amendment Bill [B 14—2020]

The Chairperson said that she would read through the Bill,” section by section”. She read out what was being amended:

Amendment of section 1 of Act 55 of 1998, as amended by section 40 of Act 65 of 2002, section 26 of Act 68 of 2002, sections 23 and 25 of Act 52 of 2003, section 51

of Act 11 of 2013 and sections 1 and 2 of Act 47 of 2013.

The Chairperson asked if there were any questions in Section (Clause) 1:

Dr M Cardo (DA) requested that the Bill be flighted on the screen.

The Chairperson asked the Legal Advisor whether she should call for proposers and seconders for changes. She encouraged Members to ask questions of the Legal Advisor and ask for guidance as it was difficult to deal with legal matters and she did not want to leave anyone behind or for anyone to feel excluded.

Ms Isaacs indicated that the Committee should first discuss the clauses. She suggested that the Secretary show both documents.

[It proved technically difficult to show both documents].

Ms C Mkhonto (EFF) suggested that Members focus only on the Amended Bill.

Dr Cardo suggested that Members go through the Bill clause-by-clause as it was the first time that the Committee had gone through it.

Ms H Denner (FF+) stated that it would appropriate to view both Bills as Members deliberated.

The Chairperson said that technology did not allow the Committee to show both Bills and she requested Ms Isaacs to point out what the Members should be looking at.

Clause-by-clause Reading and Discussion

Ms Isaacs stated that she would read each clause and point out what was being deleted and what was being added.

Clause 1

Section 1 of the principal Act was amended by clause 1.

1(a)      by the deletion of paragraph (b) of the definition of ‘‘designated employer’’.

Ms Isaacs read the clause that was to be deleted from the Employment Equity Act: "designated employer" means- (a) an employer who employs 50 or more employees; ( b) an employer who employs fewer that 50 employees, but has a total annual turnover that is equal to or above the applicable annual turnover of a small business in terms of Schedule 4 to this Act.”

1(b) Ms Isaacs explained that 1(b) brought the Act in line with the National Minimum Wage Act; It was self-explanatory:

(b) by the insertion, after the definition of ‘‘Minister’’, of the following definition:

‘‘ ‘National Minimum Wage Commission’ means the Commission established in terms of section 8 of the National Minimum Wage Act, 2018 (Act No. 9 of 2018);’’

In 1(c ), the revised definition of disabilities brought the description in line with the description adopted by the United Nations Convention on Disabilities:

(c) by the substitution for the definition of ‘‘people with disabilities’’ for the   following definition:

‘‘ ‘people with disabilities’  [means] includes people who have a long-term or recurring physical [or], mental, intellectual or sensory impairment which, in interaction with various barriers, may substantially [limits] limit their prospects of entry into, or advancement in, employment, and ‘persons with disabilities’ has a corresponding meaning;’’;

1(d) was self-explanatory:

(d) by the insertion, after the definition of ‘‘Republic’’, of the following definition:

‘‘ sector’ means an industry or service or part of any industry or  service;’’

1(e) deleted the definition of serve or prescribe:

(e)  by the deletion of the definition of ‘‘serve’’ or ‘‘submit’’.

The definition in the current Act was limiting. It stated: (a) to send it in writing delivered by hand or registered post; or (h) to transmit it using any electronic mechanism as a result of which the recipient is capable of printing the communication.

There were no comments by Members.

Clause 2:

Clause 2 amended section 8 of the Act which dealt with psychological testing and other similar assessments. It deleted paragraph (d) relating to “The Health Professions Council of South Africa” which had been added in a recent Amendment. In addition, there were technical amendments.

  1. Section 8 of the principal Act is hereby amended by the insertion of the word ‘‘and’’ at the end of paragraph (b), the substitution for the expression ‘‘; and’’ at the end of paragraph (c) of a full stop and the deletion of paragraph (d).

Clause 3:

This clause repealed section 14:

“3. Section 14 of the principal Act is hereby repealed”.

This related to Voluntary Compliance with the Chapter on Affirmative Action in the Act.

Section 14 dealt with voluntary compliance with the chapter on Affirmative Action in the Act:

“Voluntary compliance with Chapter III of the Act: 14. An employer that is not a designated employer may notify the Director-General that it intends to comply with this Chapter as if it were a designated employer.”

Dr Cardo asked why the voluntary provision was being withdrawn. He would have thought that Parliament should be encouraging the voluntary nature of such matters rather than making them compulsory.

Ms Denner also enquired why the provision was being changed.

Mr Mkalipi explained that the provision had been based on the assumption that companies that wanted to do B-BBEE deals would comply with the Equity Act. Those companies with less than 50 employees had been excluded.

He stated that, with the changes being made in the system, employers that did not report on their B-BBEE status and yet wanted a certificate of compliance, could get a certificate by answering two questions: 1) Did the company pay minimum wages? 2) Did the company have a case of unfair discrimination decided against it in the CCMA? That meant that every company had to report – either via a long report or by answering the two questions. There could not be any voluntary reporting as both designated and those not designated had to report. Instead of voluntary reporting, the company answered two simple questions.

He added that, in time, the inspectors would check on the accuracy of the answers given.

Members were satisfied with the response.

Clause 4

Proposed the Insertion of a new section 15(A) to be inserted after section 15 in the Act:

Determination of sectoral numerical targets

15A. (1) The Minister may, by notice in the Gazette, identify national economic sectors for the purposes of this Act, having regard to any relevant code contained in the Standard Industrial Classification of all Economic Activities published by Statistics South Africa.

(2)        The Minister may prescribe criteria that must be taken into account in identifying sectors and sub-sectors for the purposes of this section.          

(3)        The Minister may, after consulting the National Minimum Wage Commission, for the purpose of ensuring the equitable representation of suitably qualified people from designated groups at all occupational levels in the workforce, by notice in the Gazette set numerical targets for any national economic sector identified in terms of subsection (1).   

(4)        A notice issued in terms of subsection (3) may set different numerical targets for different occupational levels, sub-sectors or regions within a sector or on the basis of any other relevant factor.

(5)        A draft of any notice that the Minister proposes to issue in terms of subsection (1) or subsection (3) must be published in the Gazette, allowing interested parties at least 30 days to comment thereon.’’

The Chairperson requested that Members indicate whether they were in favour or opposed to the new section to be added to the Act. Members who opposed the new section should indicate that. She requested Members listen to the deliberations which could be in favour or against. She asked Members who wished to speak to reflect their views clearly and specifically so the other Members could respond to their arguments. She asked Members to loosen up as she could feel that Members were not relaxed about discussing the Bill.

Dr Cardo proposed that the entire section 15A be scrapped as the Minister did not have any business in setting national targets in any sector. The section gave him untrammelled discretion and the guiding parameters were not sufficiently clear and, as many submitters had said, it undermined the supremacy of the rule of law. It was fatally flawed and should be scrapped in its entirety.

Ms Denner agreed wholeheartedly and stated that she would not repeat the arguments of Dr Cardo.

Ms Mkhonto thought there were important monitoring and accountability points in the section. She did not think that the Committee should give employers the power to monitor themselves. Government should give employers rules to adhere to, specifically in the employment and labour sector. She supported the clause but especially 15A(3) “The Minister may, after consulting the National Minimum Wage Commission, for the purpose of ensuring the equitable representation of suitably qualified people from designated groups at all occupational levels in the workforce…” That showed that the Minister would consult.

Mr S Mdabe (ANC) stated that the economic sector had been given an opportunity to comply with the Employment Equity Act since 1998 but had not met the targets. The clause had been decided upon at NEDLAC as the targets were necessary to ensure diversity. The sectoral targets were important for regional and sub-regional diversification. It was important that the section gave powers to the Minister to enforce rules where employers did not want to comply. The ANC supported the insertion of Section 15A.

Mr M Nontsele (ANC) spoke but he was too faint for participants on the platform to hear what he was saying.

The Chairperson requested the Secretary to contact Mr Nontsele to inform him that he was inaudible and that he could possibly put his comment in the online chat.

Mr M Bagraim (DA) noted the comment that all parties at NEDLAC had agreed to the section but he knew that there had not been consensus on that point at the meeting at which that was discussed. He wanted to consult the NEDLAC minutes of that meeting. He suggested that it was NEDLAC that should set targets as they were already set up to consult and make such decisions. It would be a disaster if the Minister set targets.

Dr Cardo said that he remained opposed to clause 4 in its entirety, but if one spoke about who should play a role in deciding the criteria, he asked why Parliament should not be the one to make the determination. It was not an administrative or operational issue.

Mr Mdabe said that the principle of the Minister’s involvement was in line with consultation with all the relevant stakeholders and had been decided at NEDLAC. The decision taken there was that there would be a process in which the Minister would make the decision following qualitative engagement with the sector. It would encourage market stability. It was important that the Minister listened, particularly if the employer was not complying with what had been determined.

Ms Denner said that she heard the point about consultation, but it would be irresponsible for the Committee to allow the Minister to have sole power and undefined discretion with no framework to determine his decisions. There had to be a framework that determined how the Minister would make such decisions. She still stood with Dr Cardo in scrapping the entire section.

The Chairperson was still concerned about Mr Nontsele whose hand was up but she could not hear him.

Mr Nontsele asked that technical staff assist him to connect.

Mr Nontsele re-joined the virtual platform. He agreed with the points submitted by Mr Mdabe. In his view, the area of consultation should be the Employment Equity Commission which consisted of social partners, labour and government. He proposed that be added to the clause. The submission that said the points were far-fetched was wrong because all parties had agreed, including the DA, because the principle was founded in the Constitution and if they disagreed, the first thing for them to do was to change the Constitution which required that the country address all the historical challenges that were associated with the imbalances at the workplace and the inequality that continued to characterise the private sector.

The Chairperson called for a seconder for Mr Nontsele’s proposal to include the Employment Equity Commission.

Mr Mdabe said that he seconded the proposal. Considering the input by the public, he suggested that 15A(3) which dealt with consulting relevant stakeholders should be amended and the Employment Equity Commission should replace the National Minimum Wage Commission. If Mr Nontsele was referring to that change, he supported him.

Ms Mkhonto said that she was not against the proposal but it made more sense to her that the Employment Equity Commission was one to be consulted because it was the custodian of Employment Equity.

The Chairperson asked for Mr Mkalipi’s response on the three points raised about consultation: the Employment Equity Commission, NEDLAC and Parliament.

Mr Mkalipi agreed with the substitution of Employment Equity Commission for National Minimum Wage Commission as it had been an error in the Bill in the first place. Regarding the setting of targets, he agreed that members of the sector had to be consulted. NEDLAC could not deal with employment targets as NEDLAC dealt with policy. However, NEDAC had given full support for the Bill and the inclusion of section 15A, although it had insisted that the Minister should consult with members of the relevant sector. The Amendment to 15A(3) would solve the problem regarding adequate consultation.

The Chairperson attempted to clarify what Mr Bagraim had said.

Mr Mkalipi said that there had been an agreement at NEDLAC by all parties. None of the parties had disagreed, but NEDLAC had said that the Minister had to consult the relevant sectors and the Employment Equity Commission. NEDLAC did not have the power to set up structures and to go out and monitor companies. That was what the Department did. There was no reason why the Minister should not be involved and there was no reason why NEDLAC should be involved. Parliament dealt with laws, not administration, but nothing prevented Parliament from calling the Minister to explain his targets and he could advise if Members considered a target too high or too low. That was the role of Parliament. Parliament could not set targets because it could not consult all sectors.

The Chairperson asked that the scribes make full notes on the important issues that had been raised, the proposals and the responses from the Department.

Ms Isaacs raised a technical/legal point in the proposed 15A(1): The Minister may, by notice in the Gazette, identify national economic sectors for the purposes of this Act, having regard to any relevant code contained in the Standard Industrial Classification of all Economic Activities published by Statistics South Africa.

Parliament was defining the limits of the Minister by saying that he should look at the codes which were published by Statistics SA. Her concern was that the15A(1) was contradicted by 15A(2):

The Minister may prescribe criteria that must be taken into account in identifying sectors and sub-sectors for the purposes of this section.

Unlike section 15A(1), 15A(2) did not give any guidance and gave the Minister complete discretion to develop criteria. There was no limit to his powers. The two sub-clauses were contradictory.

Mr Mkalipi stated that he was speaking on behalf of the Legal Unit at DEL and that deleting subsection (2) would not make a significant difference and agreed with Ms Isaacs that it could be deleted. 15A(1) was clearer in limiting the Minister’s power.

The Chairperson asked for a mover to delete 15A(2).

Mr Mdabe stated that, considering the points made by the Legal Advisor, he formally proposed that 15A(2) be deleted.

Ms Mkhonto stated that she had re-read section and agreed that 15A(2) could be deleted. She seconded the proposal.

The Chairperson noted that there were no objections but that it would mean that numbering would change in clause 4.

Clause 5

Ms Isaacs noted that clause 5 sought to amend section 16 of the Act. Section 16 dealt with consultation with employees. The Amendment cleaned up the wording in the Act.

5. Section 16 of the principal Act is hereby amended by the substitution in subsection (1) for paragraph (a) of the following paragraph ‘‘(a) with a representative trade union representing members at the workplace

[and its employees or representatives nominated by them];’’

Clause 6

The clause sought to amend section 20 of the Act with an insertion after subsection 2:

‘‘(2A) The numerical goals set by an employer in terms of subsection (2) must comply with any sectoral target in terms of section 15A that applies to that employer.’’

The targets set by the company had to comply with the targets set by the Minister.

There were no comments from Members.

1:31 Clause 7

The clause amended section 21 of the principal Act that dealt with reports to be submitted by employers. Ms Isaacs explained that the exact date on which the report was required, i.e. the first working day of October, would be removed and the Minister would prescribe when the report should be submitted, subsections (3) and (4) of the Act:

7.         Section 21 of the principal Act is hereby amended—

(a)        by the substitution for subsection (1) of the following subsection:

‘‘(1) A designated employer must submit a report to the Director- General once every year [on the first working day of October or] on such [other] date and in such manner as may be prescribed.’’;

(b)        by the deletion of subsections (3) and (4); and

(c)        by the substitution for subsection (4A) of the following subsection:

‘‘(4A) An employer that is not able to submit a report to the Director-General [by the first working day of October] within the period prescribed in terms of subsection (1) must notify the Director- General [in writing before the last working day of August in the same year] in the prescribed manner and period giving reasons for its inability to do so.’’

The Committee had no comments on the clause, despite encouragement by the Chairperson.

Clause 8

Section 27 of the principal Act dealt with minimum wages. The Amendment was intended to align the Employment Equity Act with the National Minimum Wage Act. The words [Employment Conditions] were deleted and the words “National Minimum Wage” were inserted before “Commission” in section 27. The following phrase was also omitted: [established by section 59 of the Basic Conditions of Employment Act,]

‘‘(1) Every designated employer, when reporting in terms of section 21(1), must submit a statement, as prescribed, to the [Employment  Conditions] National Minimum Wage Commission [established by section 59 of the Basic Conditions of Employment Act,] on the remuneration and benefits received in each occupational level of that employer’s workforce.’’

Clause 9

Clause 9 amended section 36 of the Act. It dealt with the requirements of an employer.

9.  Section 36 of the principal Act is hereby amended—

  1. by the substitution in subsection (1) for the words preceding paragraph (a) of the following words:

‘‘A labour inspector may request and obtain a written undertaking from

a designated employer to comply with paragraph (a), (b), (c), (f), (h), (i)

or (j) within a specified period, if the inspector has reasonable grounds to believe that the employer has failed to—’’; and

  1. by the insertion in subsection (1) after paragraph (b) of the following paragraph:

‘‘(c) prepare an employment equity plan as required by section 20;’’.  

Clause 10

Ms Isaacs said that the draft dealt with compliance orders and “issue” was replaced with “serve”. The clause also included, “or any person acting on behalf of a labour inspector,” and “in the prescribed manner”.

  1. Section 37 of the principal Act is hereby amended—
    1. by the substitution for subsection 1 of the following subsection:

‘‘(1) A labour inspector, or any person acting on behalf of a labour

inspector, may [issue] serve a compliance order [to] on a designated employer in the prescribed manner if that employer has failed to comply with section 16, 17, 19, 22, 24, 25 or 26 of this Act.’’; and

  1. by the substitution in subsection (2) for the words preceding paragraph (a) of

the following words:                                                                                    

‘‘A compliance order [issued] contemplated in [terms of] subsection (1) must be issued by a labour inspector and must set out—’’.

Ms Isaacs read the clause as it stood but reminded the Chairperson that the Department had a proposal regarding a change to clause 10.

The Chairperson asked the Department to read out the proposal.

Mr Mkalipi said that the Department was responding to public comment requested that the proposed insertion of the words “or any person acting on behalf of a labour inspector,” be removed.

Ms Mkhonto proposed the removal of the amendment.

Mr Mdabe seconded the proposal to amend.

Clause 11

This clause amended section 42 of the principal Act. Ms Isaacs made a proposal to insert ‘‘whether or not the employer has complied with any sectoral target set in terms of section 15A applicable to that employer;’’.

That was to align the section with what was proposed in the remainder of the Bill.

Dr Cardo stated that given his objections to section 15A, he also objected to clause 11 and wished it to be taken out of the Bill.

Ms Denner seconded Dr Cardo’s proposal.

The Chairperson asked for the reasons for his objections.

Dr Cardo stated that the clause gave the Minister far too much untrammelled power: it was linked to the proposed section 15A. The clause said that in addition to being measured against the national or regional economically active population, an employer was now also to be measured against ‘‘(aA) whether or not the employer has complied with any sectoral target set in terms of section 15A applicable to that employer;’’. That was not reasonable. There was a direct link between clause 11 and section 15A.

The Chairperson confirmed that Ms Denner seconded in that context and asked for a different view.

Mr Mdabe said that, as the Bill stood, it would address the legacies of discrimination. Secondly, he thought that it was fair, rational and empowered the state to deal with obstinate employers and, equally, allowed for regional diversity which was a measure requiring sensitivity and linked with good labour practice. He moved that the clause, with the amendments and the deletions, as presented to the Committee, be approved.

Ms Mkhonto noted that many objectors to section 11 had referred to the Constitution, but no one could explain to the Committee why it was unconstitutional, so she supported that the clause be retained as it abided by the Constitution of the country.

Mr Nontsele seconded the motion by Mr Mdabe.                                                              ,                                  

Ms Isaacs suggested that the wording be cleaned up without changing the meaning by simply removing “or not”:

“whether [or not] the employer had complied with the sectoral target set in terms of section 15A applicable to that employer;’’.

Mr Mkalipi agreed with the amendment proposed by Ms Isaacs.

The Chairperson asked if those Members who supported the clause agreed with the proposed amendment.

Members in favour supported the amendment.

Clause 12

Ms Isaacs explained that clause 12 proposed an amendment of section 53 of the Act regarding the awarding of state contracts. She read the proposed amendment:

Section 53 of the principal Act is hereby amended by the addition of the following subsection:

‘‘(6) The Minister may only issue a certificate in terms of subsection (2) if the Minister is satisfied that—

the employer has complied with a numerical target set in terms of section 15A that applies to that employer;

in respect of any target with which the employer has not complied, the employer has raised a reasonable ground to justify its failure to comply, as contemplated by section 42(4); the employer has submitted a report in terms of section 21; there has been no finding by the CCMA or a court within the previous three years that the employer breached the prohibition on unfair discrimination in   Chapter 2; and the CCMA has not issued an award against the employer in the previous three years for failing to pay the minimum wage in terms of the National Minimum Wage Act, 2018 (Act No. 9 of 2018).’’

The Chairperson was reminded that the Department had proposed a change.

Dr Cardo had a number of problems with the Amendment. Firstly, the clause stated if the Minister “is satisfied” which seemed an extremely vague and subjective word. What constituted “satisfaction”? What were the constraints? One submission had suggested the clause would introduce additional costs for state procurement. Did the Chief Director have a comment on that?

Dr Cardo recalled that another submission had said it was a very bad idea to link certificates to CCMA outcomes for a number of reasons: CCMA cases could drag for a very long time and they might be disputed. Did the Department have a comment?

Ms Mkhonto said she supported the section itself but she also queried the word “satisfied”. Could the Department explain? The term “reasonable ground” also was vague and it would be difficult to monitor and evaluate such a situation. She requested that the Department clarify or provide more appropriate words.

Mr Nontsele moved for acceptance of the clause but requested an amendment in (d) and (e ) from ”three years” to “12 months”:

“(d) there has been no finding by the CCMA or a court within the previous 12 months that the employer breached the prohibition on unfair discrimination”.

The provision was not new; it was just an amendment, so the points raised by other Members were not appropriate because they proposed amendments on points that had not been changed from the principal Act.

The Chairperson requested a response from the Department.

Mr Bagraim had problems with the clause. “(b) reasonable grounds “to justify failure would lead to an arbitrary decision by the Minister. If he were having a miserable day, he could simply decide that he was not accepting the “reasonable grounds”.

As regards (d) and (e), Mr Bagraim pointed out that the CCMA often made decisions or awards that were overturned by the Labour Court when a company or a person went on review, although that process could take up to three years. Many incorrect decisions were made by the CCMA because many of the people working there were not lawyers. It would mean that people could not do business during the period that they did not have a certificate and that would destroy businesses, which would destroy jobs, which was the golden thread running through the piece of legislation. He did not know why Parliament wanted to destroy jobs.

Dr B Nkabane (ANC) said she supported Mr Nontsele. She told Dr Cardo that the term “satisfied” was used in the principal Act. The term meant in SA English: “when the Minister was satisfied that conditions had been met.”  She proposed the word “satisfy” remain.

Mr Mkalipi said the word” satisfied” did not stand on its own in the clause. The Minister had to be satisfied with what was stipulated in the Act. He could not be “satisfied” with just anything. If the employer had to comply with a target and the target was “A”, the Minister had to be satisfied that “A” had been attained. The regulations compiled and gazetted in terms of the Employment Equity Act had been accepted by NEDLAC and included a number of reasons why the employer could not comply with the law. E.g. if there had been a lack of compliance because of Covid-19, the Minister could be satisfied with that explanation.

He agreed with a time period of 12 months as the Department assessed employers on an annual basis and “there was no point in receiving an application and then having to wait three years for a Commission for Conciliation, Mediation and Arbitration (CCMA) clearance”.

He added that there was space for the Minister to approve any “justifiable reason”. NEDLAC had agreed to justifiable reasons that could be offered by the employer for not meeting the target. For example, under certain conditions, the pandemic could be a reason for not meeting targets. When an employer gave a justifiable reason, that employer received a certificate immediately. However, if the inspectors found that the employer had lied, then action would be taken. The Minister had a defined list of reasons for rejecting an employer’s grounds for not meeting targets. He did not make random decisions based on feelings. If there was no finding by the CCMA, nothing could be done during the CCMA process, no matter how long it took. Mr Bagraim should know that if a court case or review was in progress, the status quo remained.

Mr Mkalipi pointed out that inspectors reported on an annual basis. Therefore, the Department had reduced the proposed timeframe from three years to align with the twelve-month reporting period. It defeated the purpose if one received the report but “could only assess the company in three years’ time when the Department knew that the company did not have a decision against it by the CCMA.”

He added that NEDLAC had agreed with the reasons which could lead to the Minister being “satisfied”.

Mr Bagraim understood what Mr Mkalipi had been trying to say but that was not the way the clause read. It said that a certificate would not be awarded if there was an award against the company; it did not consider cases under review or in court. The wording was wrong. It should include “unless there was an appeal or the case had gone on review”. What Mr Mkalipi was saying would be acceptable but the Bill was wrong. He stated that the law did not put a decision on-hold during an appeal. The Sherriff attached goods on a daily basis, even if a decision was being appealed or under review.  If the Department did not want a certificate suspended when a matter was under appeal, that should be included in the clause, or it could say in the legislation that the award had to stand aside, but that was not how the law worked at present.

The Chairperson asked if Mr Bagraim was proposing a re-wording. If so, he should do so and not give long-winded stories that confused people. He should go straight to the point.

Ms Mkhonto said that, knowing the status quo in the country, only a few employees could subject employers to CCMA and the courts, so could the law encourage employers to comply with labour laws? That covered even employees who did not have the capacity to report employers to the CCMA. There were many cases of employees being mistreated. She did not know how to put it in the legislation.

Mr Bagraim stated that he proposed the words “unless subject to an appeal or review” be inserted at the end of sub-clauses (d) and (e).

(d)“there has been no finding by the CCMA or a court within the previous three years that the employer breached the prohibition on unfair discrimination in Chapter 2, unless subject to an appeal or review;”

(e) the CCMA has not issued an award against the employer in the previous three years for failing to pay the minimum wage in terms of the National Minimum Wage Act, 2018 (Act No. 9 of 2018) , unless subject to an appeal or review;”

Dr Cardo seconded the proposal, notwithstanding his objection to clause 12.

Mr Nontsele stated that the proposed amendment just complicated both sections by causing uncertainty because it would depend whether the employer took a decision on review. The right to review an award was already an entrenched right, so writing it into the legislation would create a doubt as to the intentions of the legislation. He had already proposed a change to the clause and it had been seconded. Mr Bagraim was just complicating the clause.


The Chairperson said that a person had made a proposal, another party could also make a proposal. Members had to follow procedure and be tolerant of one another.

Ms Mkhonto said that Mr Bagraim’s proposal would complicate matters even more if more possibilities were given to employers. That phrase made it worse for those employees who could not take their employers to the CCMA.

Ms Isaacs asked if Members were comfortable with “satisfied” because she could remove the word.

The Chairperson said that the Department had explained that the term was in common use in legislation and it was comfortable with that. There was the change in timeline and Mr Bagraim’s proposal was not accepted by some Members, so there was nothing further to do in respect of that clause.

Clause 13

Clause 13 repealed section 64A of the principal Act and related to the term “designated employer”.

Ms Isaacs noted that it was a consequential amendment relating to the repeal of term ‘designated employer”.

Clause 14

Schedule 4 was repealed.

Clause 15

The clause deleted footnotes 4 and 7 that were no longer applicable.

Clause 16

The short title and commencement date:

  1. “This Act is called the Employment Equity Amendment Act, 2020, and takes effect on a date fixed by the President by proclamation in the Gazette.”

Ms Isaacs informed the Chairperson that that was the end of the Bill.

There being no comments, the Chairperson stated that, the following day, the Committee would table the A-list which would include all changes agreed upon during the meeting. She added that a Committee Report had to be formulated and adopted by the Committee because the Bill would still have to be debated in the National Assembly before adoption by the House.

Ms Mkhonto asked the Chairperson what was expected of Members at the meeting the following day.

The Chairperson requested Ms Isaacs to respond.

Ms Isaacs had noted the wording of the proposed amendments and the Committee would be considering the proposed amendments as per the A-List so that the B-Bill could be drafted. The B-Bill would be adopted at a following meeting at which the Committee Report would also be considered.

Closing remarks

The Chairperson was happy, especially with Members who were in their first term. She had been panicky because the process was very complicated. She explained that guests were not permitted to participate: their time had come and gone. She requested that the A-list be distributed by the end of the day.

She suggested that the meeting on 18 June 2021 start at 10:00.

The Secretary agreed to arrange that.

The Chairperson appreciated the work by Members. They had done extremely well. The day had required political maturity and the Members had shown it. There was nothing wrong in disagreeing in the Committee.

The meeting was adjourned.


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