Question 1

What is Employment Equity (EE) and who is a designated employer?

Accepted Answer

Employment Equity is a South African legislative framework aimed at achieving workplace diversity and eliminating unfair discrimination. A designated employer is any business that employs 50 or more employees, regardless of annual turnover.

Question 2

What are the new EE sector targets and how do they affect my business?

Accepted Answer

The Minister of Employment and Labour has introduced five-year numerical goals for 18 economic sectors. Businesses must align their internal EE plans with these sector-specific targets for racial and gender representation.

Question 3

What is an EEA2 and EEA4 report?

Accepted Answer

The EEA2 is the annual report that profiles your workforce demographics and progress against your EE plan. The EEA4 is the income differential statement that tracks remuneration gaps across race and gender. Both must be submitted to the Department of Labour annually.

Question 4

What happens if we fail a Department of Labour (DoL) audit?

Accepted Answer

Non-compliance can lead to DG Reviews, compliance orders, and significant fines — up to R2.7 million or 10% of annual turnover for repeat offenders. It also results in the withholding of an EE Compliance Certificate (Section 54), mandatory for doing business with the State.

Question 5

How does EE compliance impact our B-BBEE scorecard?

Accepted Answer

EE data is the direct source for the Management Control element of your B-BBEE scorecard. Inaccurate EE data or failing to submit your DoL reports can lead to the loss of all Management Control points.

Employment Equity Advisory South Africa