Employment Equity A/B; COID A/B: response to submissions & clause vote

Meeting report

Chairperson’s opening remarks
The Chairperson said the Committee would take a clause-by-clause vote on the Employment Equity Amendment Bill and Compensation for Occupational Injuries and Diseases Amendment Bill.

He noted the submission by COIDLink from a previous meeting which is more of a complaint about the Compensation Commissioner and the Department. He had committed to make a follow up. The Chairperson held a management meeting where advice was sought from the Parliamentary Legal Advisor and the Procedural Unit and the legal team would respond in this meeting.

Legal advice on COIDA Bill submission
Mr Nathi Mjenxane, Parliamentary Legal Advisor, took the Committee through a memorandum that the Legal Team drafted in response to the COIDLink submission on the Compensation for Occupational Injuries and Diseases (COID) Amendment Bill.

The submission took issue with the regulations published by the Compensation Commissioner in terms of section 6A(b) of the Act and published on 27 September 2021, under General Notices 615 and 616, in the Government Gazette No 45344. The Commissioner states that the regulations are aimed at strengthening systems of internal control to enable the fund to verify bank account details for the payment of benefits to secure claim payment to the correct beneficiary. Further, it is intended to ensure claims are processed and paid within a reasonable period of time.

The Notice provides a list of required documents and the process for people to update their banking details with the Compensation Fund. The COIDLink submission contends that the notices were published to undermine the parliamentary legislative process and go beyond the enabling legislation and therefore was ultra vires. COIDLink has written to the Commissioner to seek clarity and the Commissioner has ignored the matter and failed to respond.

Mr Mjenxane said in terms of the principle of legality, a person can exercise powers that are granted by law. Therefore, any exercise of public power that is not granted would be considered invalid as it cannot withstand legal scrutiny if not conferred by law. Section 6A of COIDA provides that the Commissioner shall – by notice in the Gazette, prescribe the rules referred to in section 56(3)(c ), as well as the forms to be used and particulars to be furnished in connection with the notice of occupational injuries and diseases, claims for compensation or any other form or matter which he or she may deem it necessary for the administration of the Act. In effect, Section 6A(b) of the Act grants the Commissioner the power that he exercised when he published the notices.

The legal team found no justifiable basis in the law for the allegation that exercising a power that is expressly provided for in law, serves to undermine a process that is yet to be concluded. It is the legal team’s view that the Compensation Commissioner exercised a power that is expressly granted to him by law when he published the notices. The legal team could not find any justifiable legal basis to justify the allegation that when publishing the notices, the Commissioner was acting in bad faith and had ulterior motives of undermining the legislative process.

Mr Mjenxane lastly stated that regardless of the advice from the legal team, the Committee has the power to invite the Commissioner to attend a Committee meeting in which he may be required to explain the rationale for publishing the notices and the extent to which such publishing may undermine the work of the Committee of amending the COIDA.

Discussion
Mr M Rayi (ANC, Eastern Cape) asked if the legal team had considered the contents of the email from Ms Boshoff where she raised similar concerns about the Commissioner.

Ms Shamara Ally, Parliamentary Legal Advisor, added that the concern raised by the aggrieved parties were important but were however not pertinent to the process currently underway in the Committee. She suggested the matter be parked and once the Bill becomes an Act, this can be revisited at that time.

Mr M Dangor (ANC, Gauteng) stated that considering the advice given, the Commissioner did not act outside of his powers. He suggested that the Committee dismiss the grievances received as suggested.

He raised concern that when the aggrieved parties were before the Committee, they refused to answer how much they were receiving as debt collectors.

Ms H Boshoff (DA, Mpumalanga) sought clarity if SAICA can appeal the Commissioner actions.

She asked for clarity on why the Bill does not have the cession of invoices by medical service providers to third-party administrators. Her understanding was that the Portfolio Committee on Employment and Labour amended Clause 43 of the Bill and then only did this regulation come out. She asked for clarity on what informs this process.

Mr M Mmoiemang (ANC, Northern Cape) agreed that the legal advisors are clear that the Commissioner acted in good faith and that he accepts the opinion by the legal team.

Ms Boshoff sought the reason for the notice in September being dismissed and then gazetted again in October.

She stated that at the Committee meeting in February with the Portfolio Committee, it was stated that the Commissioner would reply to the 75 submissions in writing. She asked what those submission stated and why the Commissioner had not responded to them yet.

Mr T Dodovu (ANC, North West) requested that the Committee ensure that this consultative process is not contaminated seeing as many stakeholders responded to the request for public consultation. He suggested that consultation be made with the Commissioner after the Bill has been adopted by Parliament, so a precedent is not set that the Committee is opening the floodgates for further stakeholder engagement.

Parliamentary Legal Advisor response to Ms Boshoff email
Mr Mjenxane responded that the content of the email from Ms Boshoff was a notice from the South African Institute of Chartered Accountants (SAICA) raising a similar concern that the acts of the Commissioner are ultra vires. The legal team comes to the same conclusion that that the Compensation Commissioner exercised a power that is expressly granted to him by law when he published the regulations.

In terms of the law, the aggrieved party has the right to approach the administrator who made the decision, in this case the Commissioner, or alternatively appeal the decision. If the aggrieved party is unsuccessful in the appeal, it can take it on judicial review where the court can review if the decision-maker acted reasonably and justifiably when making the decision to publish the regulations.

It is not a matter that can be ruled on by Parliament at this stage, because the Committee is currently engaged in amending COIDA and will not be able to pronounce on the invalidity of a power that is expressly given to the Commissioner. SAICA was correct to take the matter up with the Commissioner and should it fail, it may continue to appeal.

He would not be able to advise SAICA on its options. As an officer of the law, he outlined the procedures. The Bill referred to in the SAICA complaint is currently under discussion. The processing of the Amendment Bill is not complete. A Bill can never be used to come to a conclusion under law.

He advised that the Committee invite the Commissioner to appear before it to answer any questions raised.

The Chairperson stated that a suggestion was made to the Committee secretary to invite the Commissioner to a joint meeting with the Portfolio Committee to address the notices the Commissioner published and the opinion of the legal advisors.

In response to the question about the 75 submissions, the Chairperson stated that the Select Committee is not entitled to know the operations of the Portfolio Committee. He suggested that this Select Committee focuses on the mandate of the meeting.

Engagements with the Commissioner and the Department were not meant to dictate changes to this Amendment Bill process but to deliberate and make suggestions where appropriate.

During public engagements, it must be made clear to stakeholders that once they have made a submission to the Committee, they must leave it in the hands of the Committee to take it forward – and not think that there will be back and forth unending dialogue with the stakeholder.

COID Amendment Bill: Department responses to public submissions
The Chairperson took the Committee through the document:

Section 1 – amendment of the definition of “Accident”
Business Unity South Africa (BUSA): The issue raised was to replace “and” with “or” in the following definition: “accident” means and incident or occurrence arising out of and in the course of an employee’s employment. It was agreed by DEL and social partners at NEDLAC which BUSA is a constituency, to keep the word “and.”

Mr Mmoiemang said the DEL response was sufficient.

Ms Boshoff stated that the Democratic Alliance reserved its opinion.

Section 4 – transfer of the Director-General’s administrative powers to the Commissioner
BUSA made a submission that the word Director-General still appeared where it must be replaced by Commissioner. DEL responded that it was agreed upon at NEDLAC and to avoid human error, the Office of the Chief of State Law Advisor advised on the need for the omnibus provisions in clause 62 of the Bill: “Substitution of certain expressions in Act 130 of 1993.”

Ms Boshoff stated that the DA reserved its opinion.

Mr Mmoiemang said the DEL response was clear and he agreed with it.

Section 69 – on the 30 days’ notice period before amending schedule 3 of the Act
BUSA proposed that the notice period for the amendment of Schedule 3 should be 60 days rather than 30 days. DEL responded that Clause 39 amends section 69 and provides for Government Notice to be published at least 60 days before amending Schedule 3. So this is in line with BUSA submission. BUSA also proposed that the penalties should be expressed monetary terms rather than percentages and that the Bill must still provide for offence to be imposed by court.

DEL stated that it was agreed at NEDLAC that DEL must decriminalize non-compliance to COIDA by the substitution of the offences and fines provisions with the administrative penalties. It was also agreed that it is undesirable to put actual amounts of penalties but that percentages must be used.

Mr M Dangor (ANC, Gauteng) agreed with the DEL response, especially on the use of percentages instead of monetary terms as percentages were flexible.

Ms Boshoff stated that the DA reserved its opinion.

Insertion of Section 70(A)(1)(c) and s(b)
COSATU proposed that the insertion of Section 70. If enacted into law it will restrict the injured employees to their previous employment and will not empower them to perform work either as independent contractors or to be self-employed. It further submitted that section 70A(1) must provide for mandatory provision of rehabilitation facilities, service, and benefits.

DEL believes the ambit of the proposed section 70A is wide enough to assist the injured employee to perform not only the work he/she was doing at the time of the accident or contraction of disease, but also to be rehabilitated to engage in other economic activities such and independent contractor or self-employment. The regulations and policies on rehabilitation will provide for the implementation of section 70A. The discretionary use of “may” is linked to the incentive to employers who participate in rehabilitation programmes on the reduction of premiums / assessments that employers must pay annually. This is likely to get buy-in from employers rather than the mandatory provision.

Ms Boshoff stated that the DA reserved its opinion.

Mr M Dangor (ANC, Gauteng) accepted the DEL response.

Section 30 – the issuing of licenses
COSATU raised concern that the issuing of licenses to the licensees might fall in the hands of insurance companies who may deprive the employees of benefits on the basis if technicalities. They raised further concern on how the operation of licenses will be supervised to ensure that workers’ claims are not inappropriately rejected. COSATU proposed that licenses should be issued to organisations subject to control of Boards consisting of an equal number of representatives of employers and registered union; and that the awarding of licenses is done through transparent and fair procedures.

DEL responded that the license in their current form already contains built-in mechanism for monitoring of the licensees in that in addition to the conditions prescribed by the Minister, the Director-General is empowered to determine the conditions for provisional settlement of claims. Section 30 already provides that the Minister may determine the conditions for the license and the financial securities thereof. Board representation can form part of those conditions along with many other governance conditions. DEL agreed that licences must be awarded through a tender.

Mr Mmoiemang agreed with the DEL response.

Ms Boshoff stated that the DA reserved its opinion.

The Chairperson stated that in the interest of time, he would read out the clause only and allow members to state if they agreed with the public submission or DEL response.

Section 18, Section 73, Section 73, Clause 43 Amendments
Mr Mmoiemang agreed with the DEL response.

Ms Boshoff stated that the DA reserved its opinion.

COID Amendment Bill: voting
The Chairperson then led the Committee to vote on each section of the Bill.

Long title
The Chairperson said no amendments were made to the Long Title which was the Bill's purpose.

Mr Mmoiemang, Ms M Moshodi (ANC, Free State), Mr Dangor , Mr Dodovu and Mr M Rayi voted in favour.

Ms Boshoff and Mr T Brauteseth (DA, KZN) voted against the clause.

Clause 1
The five ANC Members voted in favour of the clauses.

The two DA Members voted against the clauses.

Mr Brauteseth asked for clarity if voting was by province or by political party.

The Chairperson replied that voting was on an individual basis as it was a Section 75 bill.

Ms Boshoff asked for the difference between abstaining from a vote and reserving a position.

Ms Ally replied that when a party abstains, they neither agree nor reject a point put forward. This is similar to reserving their position because they are not taking a decision.

Clauses 2 to 38
The five ANC Members voted in favour of the clauses.

The two DA Members voted against the clauses.

Clause 39
Ms Suraya Williams, State Law Advisor, noted one of the public submissions was that the 30 in brackets should be omitted and the 60 should not be underlined.

The five ANC Members voted in favour of Clause 39.

The two DA Members voted against the clause.

Clauses 40 to 42
The five ANC Members voted in favour of the clauses.

The two DA Members voted against the clauses.

Clause 43
Ms Williams stated that 2021 should be substituted with 2022.

The five ANC Members voted in favour of the clause.

The two DA Members voted against the clause.

Clauses 44 to 62
The five ANC Members voted in favour of the clauses.

The two DA Members voted against the clauses.

Clause 63 and Clause 64
Ms Williams stated that in 2021 in these clauses should be substituted with 2022.

The five ANC Members voted in favour of the clauses.

The two DA Members voted against the clauses.

[Clause 63 was later voted on again in this meeting]

The Committee adopted the Bill with the one consequential amendment on the year change.

Way forward
Mr Mjenxane, Parliamentary Legal Advisor, stated that if the Select Committee had proposed amendments, then the Bill would go back to the National Assembly. However, the Committee will submit a report on the Bill indicating all the processes that took place and submit it to the National Council of Provinces House for debate.

The Committee does not need to deal with the Memorandum of the Objects as the legal team would make any changes to the Memorandum if this was needed.

The Chairperson asked for clarity if the year changes from 2021 to 2022 in the Bill were regarded as amendments that needed to be taken back to the National Assembly.

Mr Mjenxane replied that year changes were cosmetic changes that were consequential. Such changes do not need to be taken to the National Assembly.

The Chairperson indicated that the Committee is done with the COID Amendment Bill. They will consider the Committee Report on the COID Amendment Bill at the meeting of 22 March 2022.

Mr Mmoiemang asked if there is a better way of processing the next Bill rather than clause-by-clause in the interest of time.

The Chairperson responded that the Committee Procedures, Practice and Systems Handbook produced by the SA Legislative Sector (SALS) states the processes that should be followed when reviewing a Bill and that includes reviewing the Bill clause-by-clause.

Mr Thembinkosi Mkalipi, DEL Chief Director: Labour Relations, took the Committee back to Clause 63, stating that the clause mentions “workers” when the whole Bill refers to “employees.” This should be changed to read “employees.” He said there is a big difference between the definition of employees and workers.

Mr Mjenxane stated that this would lead to a Committee amendment being submitted to the National Assembly.

Mr Harry Maphologela, DEL Legal Advisor, explained that the word “workers” is not in the principal Act. The word “worker" was inherited from the High Court and Constitutional Court decision where domestic workers were being deliberated. It was inadvertent on the part of DEL to use the work “worker” instead of “employee.” The principal Act refers to domestic employee and not a domestic worker.

Ms Ally said her concern was the difference in the definition of “worker” and “employee". Any proposed amendments by the Select Committee would have to go back to the National Assembly. If this clause was in the original Bill before the Committee, then there is no problem. However if this clause was in the Act but not the original Bill, there is a problem and the Committee will not be able to agree to that amendment even if it is a consequential amendment because procedurally it would be incorrect.

Ms Boshoff agreed with Ms Ally that the Committee does not have the power to make amendments to a Section 75 Bill. Changing "workers" to "employees" should be taken back to the National Assembly.

Mr Brauteseth agreed that it would be improper and irregular not to refer it back to the NA.

Mr Rayi stated that the Committee either needs to amend it or leave it as it is, because it came from the Portfolio Committee as “workers.” This Select Committee will not be able to change it because when it was advertised for public comment it had the wording domestic “workers.” This should have been picked up before it came to the Select Committee.

Ms Suraya Williams, State Law Advisor, referred the Committee to Section 75 of the Constitution which states that the National Council of Provinces (NCOP) may pass the Bill as is or pass the Bill with a proposed amendment or it can reject the Bill. The Committee can propose an amendment and the Bill will go back to the National Assembly.

Mr Mjenxane agreed with his colleague. The Select Committee is amending this legislation now and it is not bound by what happened in the Portfolio Committee. The terminology is not in sync with the Act. The word "workers" is an oversight and it is a technical amendment to change it to "employees" to make it consistent with the Act; it does not change the meaning of the clause. Leaving it as "workers" might lead to confusion as it is not in sync with Act.

Mr Mmoiemang supported the comment by Mr Mjenxane that the amendment is cosmetic; it does not change the meaning. This cosmetic change does not affect the letter and spirit of the Bill.

Ms Boshoff requested an interpretation of Section 75(1)(c): the National Assembly must consider the proposed amendment.

Ms Williams clarified that the Committee can propose amendments, but it cannot make amendments itself.

The Chairperson asked if the amendment should be proposed in the Committee report or should it be made in this meeting.

The Committee Secretary suggested that the Committee take another vote on clause 63 as the minutes need to reflect that clause 63 was not amended.

The Chairperson sought clarity if the Committee was permitted to review its previous decision on clause 63.

Ms Ally replied that the Committee was permitted to review the decision.

Clause 63 re-vote
The five ANC Members voted in favour of the amended clause with the word "employers".

The two DA Members voted against the amended clause.

Employment Equity Amendment Bill: Department response to submissions
The Chairperson and Mr Mkalipi took the Committee through the DEL responses to the submissions (see document):

Section 15A, Section 16, Section 20(2A),
Mr Mmoiemang stated that the ANC agreed with the DEL responses.

Ms Boshoff stated the DA reserves its opinion on the matter.

Section 42(1)(aA);
Mr Mmoiemang stated that the ANC agreed with the DEL responses.

Ms Boshoff stated that the DA reserves its opinion on the matter.

Section 42(a)
Ms Sueanne Isaac, Parliamentary Legal Advisor, noted the Cosatu submission to change "and" to "or" in Section 42(a) which DEL had agreed to. This clause was not in the Amendment Bill so this proposal is an amendment to the Principal Act. Since this clause was not part of the public participation process then this raises a challenge. Although it seems like a technical amendment from "and" to "or", the Committee would need to reopen the public participation stage on this single submission which has been made late in the process to amend the original Act. Ms Isaac referred to the South African Veterinary Association Constitutional Court decision which declared a bill unconstitutional under similar circumstances so she advised caution.

The Chairperson said the Committee had already taken a position on this that it would not open up consideration of clauses outside the Amendment Bill. It was agreed that it would be easier for the Department to bring a new Amendment Bill because this clause was not part of the advertised Bill for public comments.

Mr Dodovu raised concern that DEL said this amendment was mistakenly omitted despite having been raised at NEDLAC. How many important items had been mistakenly omitted by DEL?

Mr Dangor stated that this issue was raised in the Western Cape some years ago and it had some very detrimental consequences. The Committee should proceed with caution if it takes up the matter as there could be consequences.

The Chairperson asked if everyone agreed to this decision to consider only the Amendment Bill. He highlighted that should the Committee decide to take this action of public comment, the process underway at the meeting must be paused as the Committee would need to readvertise Section 42(a) and engage in public hearings again. The processing of this Bill has been a very long process and that action would suspend this process.

Mr Mmoiemang agreed that the new clause could not be entertained.

Ms Boshoff agreed that this should not be included as it was brought before the Committee like this after the National Assembly engagement on the Bill.

The Chairperson pointed out that it was not even considered by the Portfolio Committee as this was only picked up afterwards.

Section 53
Ms Boshoff stated the DA reserves their opinion on the clause.

Mr Dangor stated that he agreed with the DEL response.

Clause-by-clause vote on the Employment Equity Amendment Bill
The Chairperson then led the Committee to vote on each section of the Bill.

Long title
No amendments were made

The five ANC Members voted in favour of the Long title.

The two DA Members voted against the Long title.

Clause 1
The five ANC Members voted in favour of the clause.

The two DA Members voted against the clause.

Clauses 2 to 5
The five ANC Members voted in favour of the clauses.

The two DA Members voted against the clauses.

Clause 6
Ms Isaacs noted that the word should be “numerical” targets and not "sectoral" targets so it is consistent.

Mr Mkalipi was of the opinion that it is the Minister who sets numerical targets for sectors, but employers set goals. It is clear and there is no confusion about the interpretation. It does not need the addition of "numerical". He disagreed that there was inconsistency as one would need to refer to Section 15A on "Determination of numerical sectoral targets".

Mr Brauteseth stated this was unacceptable. He asked why DEL did not pick this up at the department level. It is unacceptable for the Committee to sit in meetings cleaning up the mistakes of the Department.

The Chairperson corrected the Member that this was not a DEL mistake but a concern about consistency raised by a Legal Advisor.

Mr Dangor asked if changing the word from "targets" to "quotas" changed the meaning of the clause.

Ms Boshoff commented that there is a big difference between numerical targets and sectoral targets. If it is changed, it must be referred back to the NA as a proposed amendment.

Mr Mmoiemang asked if it would solve the problem to state “numerical sectoral targets.”

Mr Mkalipi advised that the clause should go with the Section 15A heading which says "Determination of numerical sectoral targets".

Ms Isaacs agreed to continue with the heading if the Committee is happy with the wording and it says it is consistent.

Mr Dangor expressed concern that if the legal team was confused then he was afraid of a myriad of court cases that will follow the Bill.

The Chairperson requested that the Committee rely on the heading of Section 15A.

The five ANC Members voted in favour of the clause.

The two DA Members voted against the clause.

Clauses 7 to 16
The five ANC Members voted in favour of the clauses.

The two DA Members voted against the clauses.

The Chairperson thanked all who were present. The Committee would draft and consider the Committee Report on the Employment Equity Amendment Bill on 22 March 2022.

The meeting was adjourned.