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Employment Equity Explained

The purpose of this article is to provide Employment Equity information in an easy-to-read format so that every business owner can understand it. Wherever ‘Employer’ is used below this means a Designated Employer.

Part 1- EE Definitions and general terms

• Who is a Designated Employer?
This is an employer with more than 50 employees.
• What are the top 4 Occupational Levels?
1. Top Management
2. Senior Management
3. Mid management/ Professionally Qualified/ Experienced specialists
4. Skilled Workers/ Supervisors / Foreman and Junior Management

• Who are the Designated Groups?
Black people (African, Coloured and Indian), Women and people with disabilities.
• What is the EAP?
This is a document that details the Economically Active Population between the ages of 15 and 64 years old, by race, gender, nationally and provincially.
• Temporary Employees
People employed for less than 3 months.
• What are Numeric Goals?
The entire workforce profile in terms of race, gender and disability, the employer seeks to achieve by the end of the EE plan period. (5 years)
• What are Numeric Targets?
The entire workplace profile in terms of race, gender and disability, the employer seeks to achieve by the next reporting period. (1 year)
• What 12-month period should be included in the reporting cycle?
1st October to 30 September.
• What period should the Employment Equity Plan cover from 1st April 2025?
5 years from 1 September 2025 to 31 August 2030.
• What is the deadline for submitting EE reports by hand, to the Department of Labour?
Annually, from 1st September until the first working day of October.
• What is the deadline for submitting EE reports electronically to the Department of Labour using the online EE reporting system?
1st September until 15th January the following year.

• First reporting period for employers that become a designated employer on or after the first working day of April 2025.
The first EE report is to be submitted in the following reporting cycle.
• A designated employer that is a holding company controlling more than one registered entity may choose to submit a consolidated report. Where this is the case, the consolidated report must be supported by individual EE Plans for each of the registered entities included in the consolidated report and adopt a method of reporting that remains consistent for the duration of the plan.

• Public companies that are designated employers must publish a summary of their EE Report in their annual financial report including the information specified in the EEA10 template.

• Who may verify and authorise the information contained in the EE report?

  1. CEO – Private sector
    Accounting
  2. Officer – Organ of State

Part 2 – Duties of a Designated Employer

Step 1 – Collect information and conduct an analysis

 

• The Employer must request each employee in the workforce to complete a declaration using the EEA1 template.

• Where an employee refuses to complete the form or provides inaccurate information, the employer may establish the relevant details by using reliable historical and existing data and persons with disabilities have the right not to declare their disability.

• Conduct a review the employment policies, practices and procedures as well as of the working environment in order to identify employment barriers which adversely affect people from designated groups from being equitably represented across all occupational levels. The outcome of the analysis must be documented using the EEA12 template. The completed document remains an internal record.

  • When conducting this analysis, the employer may take the following processes into account –
    a) Recruitment, selection, pre-employment testing, induction, promotion and retention.
    b) Succession and experience planning, promotions and transfers.
    c) Job assignments and training opportunities.
    d) Performance and remuneration including equal pay for work of equal value.
    e) Discipline and dispute resolution.
    f) Working conditions, including the accommodation of cultural, religious and other diversity differences.
    g) Reasonable accommodation including persons with disabilities.
    h) Corporate culture.
    i) Any other policy, procedure or practice that may arise from the consultation process.

Step 2 – Duty to prepare and implement an EE Plan

 

• Conduct an analysis of the workforce profile. This is a snapshot of each occupational level on a particular date in terms of race, gender and disability.

• The workforce profile is compared to the occupational levels and designated groups using the latest EAP record. (Refer definitions)

• The employer must record on the EEA12 template whether they are using the National or Regional EAP for their analysis.

• Further to the requirements of the EAP, employers must comply with the relevant sectoral numerical targets for the sector which they operate in. These sector targets came into effect on 1st April 2025. (Refer Govt. Gazette 52514 dated 15/4/2025)

• The 5-year sectoral numerical targets are not intended to add up to 100% as these targets exclude white males with no disabilities and foreign nationals.

• If the employer operates in more than one sector, then the numerical targets for the sector in which the majority of the employees are engaged in, will apply.

• The 5-year sectoral numerical targets are key milestones towards achieving equitable representation of the designated groups within the upper four occupational levels of an employer’s workforce in relation to the demographics of the applicable EAP and for person’s with disabilities. The 5-year target for people with disabilities is 3% across all 18 sectors.

• When determining their annual EE targets towards achieving the 5-year sectoral numerical targets, a designated employer must set numerical targets for all designated groups in each of the upper four occupational levels in relation to the applicable sectoral targets and EAP and for person’s with disabilities.

• The EE Plan is drafted by using the EEA13 template and the EE plan must contain all the elements contained in the EEA13 template that is included in the 2025 EE regulations. The completed document remains an internal record.

• A designated employer must avoid perpetuating the over-representation of any group of their representation if this exceeds the applicable EAP in a particular occupational level.

• Where the numerical target has been exceeded for a particular designated group at an occupational level, they should continue to set targets that maintain compliance with the EAP.

• Numeric goals and annual EE targets at the semi-skilled and unskilled occupational levels must be set in the EE plan taking into account the applicable EAP.

• Compliance will be assessed against annual targets towards meeting a relevant 5-year sectoral numeric target.

• There will be no penalty or any form of disadvantage if there are reasonable grounds to justify failure to comply with any target.

Step 3 – Duty to Report

 

• EEA2 & EEA4 reports can be delivered to the Department of Labour between 1st September and the first working day of October each year.

• **The completed EEA12 and EEA13 forms are used to complete the EEA2 report.

• Electronic submissions of the EEA2 and EEA4 reports by using the online reporting system via www.labour.gov.za and must be successfully submitted by 15th January each year. It is advisable to submit the reports as early as possible online to prevent technical problems or overloading the system at the last minute. The EEA 4 report is made up of Income Differentials across the Occupational Levels. There is no preparatory document for these details. Most payroll systems have these details within the system in the relevant format required by the Department of Labour. If you don’t use a payroll system, the details will need to be extracted manually from your payroll records.

• If a designated employer is unable to report in any year the Director-General must be notified in writing using the EEA14 form, by the last working day of August of that year.

• After submission of the reports, the Department must provide an employer with one of the following –
a) A letter rejecting the report because it does not comply with the requirements of the Act.
b) A letter informing the employer of errors in the report and requesting the employer to rectify the errors within a specified period.
c) An electronic acknowledgement letter stating that the report is complete and has been successfully submitted into the Department’s EE system.

Summary of the documentation required for Analysis, Preparation and Implementation of Employment Equity

 

1. Download the latest National & Regional EAP records. These can be downloaded from the latest Employment Equity Commission Report published. Or you can download this record from Stats SA.
2. Download a copy of the Government Gazette 52514 dated 15/4/2025 for the latest Sectoral Numerical Targets.
3. Download a copy of Government Gazette 52515 dated 15/4/2025 for the 2025 EE regulations.
4. Download a copy of the Code of Good Practice on the Preparation, Implementation and the Monitoring of the EE Plan – Government Gazette 40840 dated 12 May 2017. This document is used as a cross reference with the 2025 EE Regulations and provides guidelines of how the Designated employer should prepare to report to the Department of labour.
5. Download a copy of the Code of Good Practice: Integration of Employment Equity into HR Policies and Practices Amendment dated 15 February 2022. This document provides guidelines on how to integrate EE into HR policies and practices.
6. Download a copy of the EEA1 document for staff to complete and return to HR at the beginning of the EE process.
7. Download copies of the EEA12 and EEA13 templates to be used to conduct the analysis and draft the EE plan once the analysis process is complete. **Then the details from these templates are used to complete the EEA2 report.
8. If you will be submitting the EE reports by hand to the Department, then you should download copies of the EEA2 and EEA4 templates for completion once the analysis process is complete. The EEA2 template details the analysis process, the workforce profile and other information required. The EEA4 document reflects the earnings differentials across all the Occupational Levels of the organisation.
9. If you are using the online EE system to submit your reports, then you don’t need to download the EEA2 and EEA4 templates for completion. You will complete the EEA2 and EEA4 template online. You can download copies of the completed reports once you have successfully submitted these reports online. The electronic letter confirming successful submission, will be emailed to you usually the same day that you have successfully submitted the reports online.

If you remain confused by all these details, please reach out to me for assistance with all your EE processes – helen@pplsolutions.co.za or helen@synergyhr.co.za or 082 716 7597.


Yours in HR,

Helen

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