This article was written by Mlungisi Khambule, an Associate Designate at Norton Rose Fulbright South Africa

The duty to consult appears throughout labour law.  It is also an important pillar to achieving employment equity in South Africa.  With the wave of department of labour inspections for employment equity compliance persisting, it is important to understand how a designated employer* can satisfy the consultation requirement and to understand exactly where it fits in as far as employment equity is concerned.

Section 16 of the Employment Equity Act, 1998 stipulates that a designated employer “must take reasonable steps to consult and attempt to reach such agreement on the matters referred to in section 17 of the Act”.  Section 17 refers to consultation with employees conducting work profile analysis discussed below, and the preparation and implementation of the employment equity plan and the annual reports referred to in section 21.  Designated employers cannot attend to these requirements without having taken “reasonable steps” to consult and to “attempt to reach agreement” with their employees.

Who must be consulted?

A designated employer must consult with trade union representatives. If there is no trade union in the workforce, they must consult with their employees or their elected representatives.  An employment equity committee must be formed.  This committee must be representative of all members from the workforce, across all occupational levels and must include members from the designated groups.  Designated groups are citizens who are black people, women and people with disabilities.  Employees who are not from the designated groups must also be part of the committee.  Therefore it is imperative that this consultative body remains diverse and inclusive.  Ensure that all employment equity meetings proceed with a clear agenda and that signed minutes are taken for every meeting held.

Consultation on conducting an analysis

The analysis consists of the employer’s workforce profile and depicts the level of underrepresentation of members from designated groups within the workforce. A designated employer must also collect data, scrutinise their policies, practices, procedures, and their work environment to identify employment barriers which adversely affect people from designated groups.  The analysis must be conducted jointly and designated employers must be willing to disclose relevant information and give reasons and explanations to any questions that their employees may have.  The parties consulting must ensure that they understand what their desired outcomes are and must attend to each issue in question collaboratively including the setting of goals.

Consultation on preparation and implementation of the employment equity plan

The employment equity plan is the document which holds a designated employer’s employment equity strategy. It is a crucial document. Failing to have one can result in a minimum fine of R1.5 million or 2% of a designated employer’s annual turnover. This document contains objectives, goals, targets, timeframes, affirmative action measures, procedures and identified barriers to employment equity, within the workplace. When consulting on this document, a designated employer could prepare a skeletal document which could be augmented and amended as the employment equity committee sees fit, or to collaboratively provide input and ideas on each required section of the plan.  It is important that the parties must attempt to reach agreement on all the relevant aspects contained in the plan.  Consultation should also not end at the preparation of the plan, but must continue to meet with the employment equity committee to examine its progress and how it is implemented.

Consultation on Reports

Every year, a designated employer must submit a report to the Director-General. This reporting is done through the completion of the EEA2 and EEA4 documents.  These documents contain information on income and income disparities across all designated groups, numerical figures on the representation of designated groups, data on the recruitment, promotion, termination and as well as goals and targets on increasing the representation of designated groups.

The Act requires “reasonable steps” be taken to consult and an “attempt to reach agreement”.  The reasonable steps taken by the designated employer to consult and their attempt to reach agreement, becomes the area of scrutiny during Director-General reviews and inspections.  The best practice in ensuring proper consultation is to hold frequent employment equity meetings, ensure that that detailed minutes are kept and to approach the process in a collaborative fashion, considering every view and noting every concern so as to take proper action in ensuring that employment equity is achieved in the workplace.

*A designated employer is a person who employs 50 or more employees, alternatively employs fewer than 50 employees but has a total annual turnover that is equal to or above the applicable annual turnover of a small business in terms of the Schedule 4 of the Act”. A designated employer is also a municipality, an organ of state, or an employer bound by a collective agreement which appoints the respective employer as a designated employer, in terms of the Act.  Should your business satisfy any of the aforementioned descriptions, you must ensure compliance with the Act and must come to grips with the requirement for consultation with the respective statutory duties.

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