HEAD FOR SUCCESS Business Studies Grade 12. TERM 1 Topic 1: Impact of recent legislation on business – response to demands for redress and equity.

HEAD FOR SUCCESSBusiness Studies Grade 12

TERM 1Topic 1: Impact of recent legislation on business – response to demands for

redress and equity.

EMPLOYMENT EQUITY ACT (Nr. 55 of 1998)


(no unfair discrimination against an employee)

NATURE of the EEA:

This Act was introduced to rectify the inequalities before 1994.

The law promotes equality in employment and provide for affirmative action to reflect the demographics of the community in the workplace.

Provision for equal opportunities for all job seekers and fair treatment in the workplace.

Preventing discrimination applicable to all employers. No job seeker / employee shall be discriminated against in respect of race, pregnancy, sex, marital status, ethnic or social origin, colour, language, sexual orientation, disability, HIV status, culture, etc.


NATURE of the EEA:

No unfair discrimination may be allowed e.g. sexual-harassment, compulsory medical tests, etc.

Measures for affirmative action by designated employers. (This is employers who have 50 or more workers employed).

Measures for affirmative action to designated groups that includes blacks, Coloureds, Indians, women of all races and disabled persons.


NATURE of the EEA:

Companies should have an equality employment plan that forms part of the code of good business practice. This plan shall contain the following:

Reasonable progress with employment equity of the firm’s workforce.

The goals / targets to be achieved for each year of the plan.

Affirmative action measures that must be implemented.

If the current representation of designated groups is lower than it should be, the number and the time frame in which the correction will be made, must be indicated.

The time frame for each year of the plan must be indicated.

The duration of the plan with a minimum of one year to a maximum of five years.

Procedures to monitor and evaluate the implementation of the plan, etc.


PURPOSE of the EEA:

The purpose of this Act is to achieve equity in the workplace by:

Promoting equal opportunities and fair treatment of all employees, e.g. by inviting all employees to apply for a managerial position.

Eliminating unfair discrimination e.g. by giving preference to disabled persons.

Ensuring equal representation of all population groups in all occupational categories and levels in the workforce e.g. by appointing candidates of all races.

Redressing disadvantages in employment experienced by designated groups, e.g. by implementing Affirmative Action measures.

Implementing Affirmative Action (AA) measures to redress the disadvantages in employment experienced by designated groups, e.g. by giving preference to previously disadvantaged individuals when appointing new candidates.


PURPOSE of the EEA:

Employers are encouraged to formulate plans to promote employment equity. These plans must be submitted to the Department of Labour for approval.

Affirmative Action measures for designated groups of employees are specified in this Act as well as the application of affirmative action to ensure equal representation in the workplace.

Employees are protected against victimisation in the workplace.

Inspectors from the Department of Labour may visit businesses to check if their employment equity plan is implemented and non-compliance can be ended in Labour Court.

To prevent unfair employment because of past discrimination in terms of race, gender and disablility.


PURPOSE of the EEA:

To promote equal opportunities for all employees and to regulate affirmative action.

Implementation of the Government’s transformation program.

Strive for diversity / equal representation in the workplace.


ADVANTAGES DISADVANTAGES

Brings redress to people who have experienced suffering and inequality in the past.

The Act remedies one form of discrimination with another form of discrimination.

Promotes equal opportunities for all people in the workplace.

The purpose of the Employment Equity Act may clash with the purpose of the Skills Development Act.

Provides all candidates with an equal opportunity to be selected.

The Act often benefits people who have not personally experienced the discrimination of the past.

Provides all candidates with an equal opportunity to be considered for promotion .

Job seekers are employed in positions for which they lack the necessary qualifications or experience, just to meet the requirements for equity.



Promote equal opportunities and fair treatment in employment.

Workers being retrenched because of affirmative action must receive a financial compensation package which increase expenses.

Promote the implementation of affirmative action measures to rectify the imbalances in employment of the past.

Untrained employees appointed to meet the requirements of equality, should be trained which also has additional financial implications.

Prevent unfair discrimination against employees on the basis of race religion, etc.

Businesses are forced to employ someone which in the first place would not have been appointed.

Provide a framework for acceptable employment practices.

Unfair promotion f employees to meet the demands of equity at management level.



Promote diversity in the workplace. It takes time to introduce and implement an employment equity plan.

Promote consultation between employers and employees.

The law is seen by some businesses as a liability in relation to productivity that can hamper economic growth.

Certain groups of people are excluded when appointments are considered, as a result of affirmative action.

Affirmative action should be prioritised, so that disadvantaged people are given opportunities, especially to fill management positions, which can lead to the loss of qualified employees.



Can lead to conflict in the workplace.

Staff turnover can be high, which means that new employees are to be trained which has cost implications.

Trained, experienced and skilled workers are retrenched through affirmative action.

People who are qualified to do the job, are excluded, to make place for non-skilled people of the appropriate gender, race, etc.



Experienced workers leave the country because they have better work opportunities abroad.

The uncertainty of people that had to start their careers in different professions, reduce the targeted economic growth, because foreign opportunities and salaries are more attractive.

Experienced and knowledgeable workers had to make way for unskilled workers when new appointments were made as a result of the provisions of the Act.


RIGHTS / IMPLICATIONS FOR THE BUSINESS:

All employers must take the necessary action with regard to employment.

Take affirmative action to ensure that suitably qualified people from designated groups have equal employment opportunities.

Ensure that designated groups have equal representation at all levels in the business.

Provision of relevant information pertaining equality to representative parties.

No unacceptable practices may be applied e.g. reverse discrimination may not be used by appointing people from previously disadvantaged groups, without investigating the merit of all applicants.


RIGHTS / IMPLICATIONS FOR THE BUSINESS:

Applicants from designated groups should be considered when appointments for vacant posts are made.

Businesses with over 50 employees and small businesses with an annual turnover equal to or higher than the prescribed annual amount must compile an equity plan. This plan should be submitted to the Department of Labour, along with an annual report on the progress of implementing the plan.

Businesses that do not meet the above requirements, do not need to meet the affirmative action requirements set in the EEA. They may voluntarily agree to apply it.


RIGHTS FOR EMPLOYEES:

Equal opportunities in the workplace.

Elimination of unfair discrimination when applying for vacancies.

Equal representation in the workplace, according to the demographics of the country.

Provide input into the company’s employment equity plan.


IMPLICATIONS FOR SMALL AND LARGE BUSINESSES:

Implications for small businesses:

Implications for large businesses:

Business enterprises with more than 50 employees are obliged to comply with the principles of Affirmative Action.

Businesses’ employment policies must prohibit unfair discrimination. Businesses have a smaller pool of candidates to choose employees from.

Only businesses that comply wit EE requirements are allowed to do business with the government – this serves as motivation for small businesses to be EE compliant (EE compliance is not enforceable b law for small business enterprises).

Skilled and experienced employees are sometimes denied promotions in order for a business to become EE compliant.



:Implications for small businesses:


Business enterprises with less than 50 employees are not obliged to have an Employment Equity Plan.

Businesses must give preference to people who were previously disadvantaged.

Employers with less than 150 employees must submit EE reports to the Director-General every two years.

Businesses have a duty to inform employees about the provisions of the EE Act by displaying the Act at the workplace.

Businesses have a duty to inform employees about the provisions of the EE Act by displaying the Act at the worlplace.

Businesses have a duty to keep record of its workforce and Employment Equity Plan.



:Implications for small businesses:


Designated employers (businesses with 50 or more employees) are required to have an Employment Equity Plan.

Employers who employ more than 150 employees must submit an annual EE report to the Director-General.

Designated employers must assign a senior manager to be responsible for the business’ EE Plan.


COMPLIANCE WITH THE PROVISIONS IN THE ACT AND PENALTIES IF THE BUSINESS FAILS TO COMPLY:

Labour inspectors have the power to issue compliance orders.

If a compliance order is not followed, the Labour Court may be requested to make the compliance order an order of the Labour Court.

This means that the business that the business will be forced to comply.

The Labour Court can impose fines on employers.

The Labour Court can impose a minimum fine of R500 000 for first violators of the law’s provisions, up to an amount of R900 000 after four offenses.



The employer cannot be penalised if the objectives set out in the employment equity plan is not achieved, but the Labour Court can act against the employer if no real attempt to reach the goals is made.

The Employment Equity Commission may help to enforce the EEA.

The provisions of Affirmative Action apply to:

Employers with 50 or more employees and an annual income that exceeds the amounts as prescribed by the EEA.

Municipalities

Organs of state

Employers ordered to comply by a bargaining council agreement.

Employers who choose to comply (voluntarily).



The EEA does not apply to:

The National Defence Force

The National Intelligence Agency

The South African Secret Services


ACTIONS IN THE EEA SEEN AS DISCRIMINATORY:

Discrimination on one or more grounds, including:

Race, gender, beliefs, pregnancy, marital status, family responsibility, ethnic or

social origin,

colour, age, disability, religion, HIV-status, political opinion, culture

Medical testing:

Prohibited, unless:

Legislation permits or requires the testing

It is justifiable in the light of medical facts, employment conditions, social policy or the inherent requirements of the job.

Testing to determine an employee’s HIV-status is prohibited


ACTIONS IN THE EEA SEEN AS DISCRIMINATORY:

Psychometric testing:

Prohibited, unless:

The test being used has scientifically shown to be valid and reliable.

The test being used can be applied fairly to all employees.

The test being used is not biased towards any employee or any group of employees.


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HEAD FOR SUCCESS Business Studies Grade 12. TERM 1 Topic 1: Impact of recent legislation on business – response to demands for redress and equity.

Documents

employment equity act

affirmative action measures

equality employment

affirmative action aa

designated groups of

designated employers

population groups

unfair discrimination