Heads up, South African employers! The Employment Equity Amendment Act No. 4 of 2022 (EEAA) officially comes into play on 1 January 2025, following a recent announcement by the President. If your company employs more than 50 people you will need to comply.
Let’s break it down.
What’s the EEAA All About?
Signed into law back in April 2023, the EEAA introduced some significant updates to the original Employment Equity Act No. 55 of 1998 (EEA). While some changes apply broadly, most of the updates are aimed at designated employers—those with over 50 employees.
Here’s the big one: the Minister of Employment and Labour now has the authority to set sector-specific numerical targets. These targets will apply across 18 different sectors, and if you’re a designated employer, you’ll need to align with these.
So far, there have been two drafts of these sectoral targets, but nothing final yet. This uncertainty has left many industries wondering what lies ahead.
What Else is Changing on 1 January 2025?
Let’s get into the specifics of what’s new:
- Who fits the definition of a “Designated Employer?”
Employers with fewer than 50 employees will no longer qualify as designated employers, regardless of their annual turnover. This means Schedule 4 of the EEA—which previously allowed some small businesses with high turnover to be designated—is now repealed. - Inclusive Definition of Disabilities
The term people with disabilities has been expanded to include individuals with intellectual or sensory impairments that may limit their access to or advancement in employment. - Simplified Psychometric Testing Rules
Psychometric tests used in hiring or employment decisions no longer need certification by the Health Professionals Council of South Africa (HPCSA) or a similar body. - Streamlined Reporting Requirements
Designated employers filing EEA2 reports no longer need their Chief Executive Officer’s signature. - Sectoral Targets and Compliance
Compliance with the Minister’s sectoral targets will now play a role in assessing whether a designated employer is meeting their obligations under the EEA. - Government Contracts Require Compliance Certificates
Section 53 of the EEA (still awaiting full effect) adds another layer: designated employers must prove compliance with sectoral targets to secure contracts with government entities. No certificate, no deal—unless there’s a reasonable excuse for falling short.
Why This Matters Now
With the EEAA coming into effect in just a few weeks, it’s crunch time to ensure you’re compliant.
For designated employers, this means taking a close look at your current processes, from equity plans to reporting practices and making sure you’re ready to meet the sectoral targets when they’re finalized.