2020 – Designated employers & the Employment Equity Act

The Employment Equity Act (“EEA”) applies to all employers, but a “designated employer” (who meets the minimum requirements) has additional responsibilities. Make sure you know what is expected of YOU and that you comply! The EEA aims to eliminate unfair discrimination in the workplace by promoting equal opportunities and fair treatment.

Are you a “designated employer”?

A “designated employer” is any employer with 50 or more employees OR an annual turnover of:

  • R6 million – Agriculture
  • R22.5 million – Mining and Quarrying
  • R30 million – Manufacturing
  • R30 million – Electricity, Gas and Water
  • R15 million – Construction
  • R45 million – Retail, Motor trade and Repair services
  • R75 million – Wholesale trade, Commercial agents and Allied trades
  • R15 million – Catering, Accommodation and other Trade
  • R30 million – Transport, Storage and Communications
  • R30 million – Finance and Business services
  • R15 million – Community, Special and Personal services
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What happens if I don’t comply?

Should a “designated employer” fail to comply with these obligations, the fine for the first offence is:

  • R1.5 million or 10% of the employer’s annual turnover (whichever is the greatest); and/or
  • 10 years imprisonment

What is expected of a “designated employer”?

A “designated employer” has additional obligations and must take care to ensure the following is in place:
  1. Appoint a Senior Employment Equity Manager to develop, monitor and implement the Employment Equity Plan (see step 7 below). This appointment must be a permanent employee and report directly to the CEO of the business.

  2. Collect information – each employee must complete the EEA1 form confirming the employee’s race, gender, nationality and any disabilities where applicable.

  3. Create employment equity awareness with regards to all employees – all employees should be made aware of and informed with regards to the objectives, content and application of the EEA, its regulations and Code of good practice.

  4. Establish an Employment Equity Committee to hold regular consultations with regards to compliance with the EEA. This committee must be representative of both designated and non-designated employees and all occupational levels. Trade unions in the workplace must also be involved and form part of consultation.

  5. Hold regular (at least quarterly) consultations to discuss the conducting of an analysis, development of a plan and submitting of the reports to the Department of Labour. These consultations must be structured and recorded via agendas, attendance registers and minutes of meetings held.

  6. Draft an analysis (EEA12) which must include the following:
    • Policies and procedures to address the under-representation of designated groups and a lack of diversity in the workplace
    • Practices and factors to promote employment equity
    • Under-representation of designated groups and occupational levels

  7. Draft an Employment Equity Plan (EEA13) which must state the following:
    • Objectives for each year (the plan is valid between one to five years)
    • Affirmative action measures
    • Numerical goals for achieving equitable representation
    • A timetable for each year
    • Internal monitoring and evaluation procedures, including internal dispute resolution mechanisms
    • Identified persons to monitor and implement the plan

  8. Submit Employment Equity reports (EEA2 and EEA4) on progress made with regards to the implementation of the plan. The reporting period is a twelve month period (we recommend using the employer’s financial period). Reports can be submitted electronically on the Department of Labour‘s website before 15 January 2021.

The LWO has collaboration agreements in place with a panel of service providers that specialise in the Employment equity Act and offer LWO members preferential rates. We encourage members to contact them at an early date for specialist assistance.

Take special notice of the COVID-19 pandemic’s impact on state departments, which puts pressure on time lines. Please contact the service providers directly – herewith the contact details:

  • MOULDER SKILLS DEVELOPMENT CC – James Moulder: 073 096 0078 | jamesm@msdev.co.za (read more about the collaboration agreement between the LWO and Moulder Skills Development here)
  • EUNIMA SOLUTIONS (PTY) LTD – Adv. Ernst Richter: 082 336 6074 | labourlawsa@gmail.com



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