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Need Help With Employment Equity Reporting?
The Employment Equity (“EE”) Reporting period has started. The annual reporting period begins on 1 September and closes on 15 January each year. In terms of the Employment Equity Act, each employer employing 50 or more employees, or who has an annual turnover above the turnover threshold as per Schedule 4 is deemed to be a Designated Employer. A Designated Employer needs to have an Employment Equity Plan in place and needs to comply with the provisions set out in the Act. Failure to comply may lead to harsh penalties as per Schedule 1 of the EE Act.
SCHEDULE 1: MAXIMUM PERMISSIBLE FINES THAT MAY BE IMPOSED FOR CONTRAVENING THIS ACT
| Previous contravention | Violation of any provision of sections 16 (read with 17), 19, 22, 24, 25, 26 and 43(2) | Violation of any provision of sections 20, 21, 23 and 44(b) |
| No previous contravention | R1,500,000 | The greater of R1,500,000 or 2% of the employer’s turnover |
| A previous contravention in respect of the same provision | R1,800,000 | The greater of R1,800,000 or 4% of the employer’s turnover |
| A previous contravention within the last 12 months or two (2) previous contraventions in respect of the same provision within three (3) years | R2,100,000 | The greater of R2,100,000 or 6% of the employer’s turnover |
| Three (3) previous contraventions in respect of the same provision within three (3) years | R2,400,000 | The greater of R2,400,000 or 8% of the employer’s turnover |
| Four (4) previous contraventions in respect of the same provision within three (3) years | R2,700,000 | The greater of R2,700,000 or 10% of the employer’s turnover |
SCHEDULE 4: TURNOVER THRESHOLDS APPLICABLE TO DESIGNATED EMPLOYERS
| Sector/sub-sectors per the Standard Industrial Classification | Total annual turnover |
| Agriculture | R6 million |
| Mining and quarrying | R22.5 million |
| Manufacturing | R30 million |
| Electricity, gas and water | R30 million |
| Construction | R15 million |
| Retail and motor trade and repair services | R45 million |
| Wholesale trade, commercial agents and allied services | R75 million |
| Catering, accommodation and other trades | R15 million |
| Transport, storage and communications | R30 million |
| Finance and business services | R30 million |
| Community, special and personal services | R15 million |
The benefits of complying with the Employment Equity Act:
- Create a more transparent and inclusive workforce;
- Eliminate discrimination in the workplace;
- Create a platform for employees to talk about unfair practices and discrimination;
- Designated Employers who report annually, is placed on a public register at the Department of Labour and will be able to tender for government contracts;
- Compliance with the EE Act eliminates the fear of penalties imposed by the Department of Labour.
Please note that annual reporting to the Department of Labour without having a proper Employment Equity Plan and Policies in place may also lead to penalties.
