Oliphant: JSE firms culprits in stalling transformation

Pretoria- A total of 192 designated employers have been referred for prosecution over their failure to comply with the Employment Equity Act requirements.

This is according to Inspector General at the Department of Labour, Aggy Moiloa, who was speaking at a briefing on the Commission for Employment Equity (CEE) report launch on Tuesday.

Moiloa explained that these companies failed to submit required reports and were referred for prosecution. Of these, 19 had paid fines worth R18.5m, 79 employers acknowledged their guilt and have not opposed the fines of R118.5m. A total of 90 employers have decided to oppose, these fines are to the value of R195m.

Labour Minister Mildred Oliphant who delivered an address said that the report reflected a “painfully slow pace of transformation” in the South African labour market. “Black people, women and persons with disabilities remain severely under-represented in all aspects of Employment Equity.”

Oliphant said this shows the lacking appetite among corporates for transformation.

“It is very concerning that there are just too many JSE listed companies that are completely ignoring the law.” So far, 21 JSE companies have been fined for non-compliance, several others are yet to be fined.

“JSE listed companies alone, account for more than 50% of the companies that have been issued fines for non-compliance,” she explained.

READ: Premature and absurd to scrap affirmative action, says Oliphant

Current fines are being criticised for being too small, suggesting an option to introduce harsher consequences for non-compliance. “We are seriously considering approaching the President to enact more punitive sections and chapters of the Employment Equity Act, which were initially excluded,” the minister said.

“This will give the Employment Equity Act, real teeth and will bite where it hurts the most.” This being the employer’s revenue, she explained.

Tabea Kabinde, chairperson of the CEE weighed in on the reasons for a lack of shift in transformation. She explained that the CEE had arranged engagements throughout the year, where CEOs and other key role players were invited. Only three CEOs had attended some of these meetings.

“This tells the extent to which top management looks or deals with transformation with seriousness, this shows no seriousness. There is no engagement, no need or desire to drive transformation in the workplace,” said Kabinde.

She added that human resources staff that took part in the engagements rarely shared on programmes for transformation but rather the observations on the attitudes towards transformation. “Participants indicated a lack of commitment to transformation because boards and executive leadership of organisations did not see it as importance. Employment equity is not part of business strategy.”

Among the issues was the lack of skilling of staff to move up in businesses, and a preference for foreign nationals at lower levels, which are much easier to exploit, explained Kabinde. There is also an issue of equal pay for equal work, she added.

“Self-regulation is not working,” said Kabinde. A proposal has been made to the minister to have companies comply with Section 53 of the Employment Equity Act. If these companies fail to comply then they cannot be issued a certificate of compliance. Not having this certificate should then exclude these companies from being able to tender or do business with the State, explained Kabinde.

The minister explained that the regulations and code of good practice is still being developed before this can be enforced. The draft bill will be discussed at a meeting with the CEE on May 17. Before finalisation, it will be presented to the public for comment.

It is projected that the bill should be ready to be tabled in Parliament by August 2017.