The Employment Equity Act

12 September 2017

Dear Client


The purpose of this letter is to provide you with information to determine whether you might also be at risk.

The Department of Labour has recently started prosecuting companies for failure to prepare employment equity plans as required by the Employment Equity Act.  These companies could face a fine at up to R15 million rand.

The Employment Equity Act 55 of 1998 aims to promote and achieve equity in the workplace, by encouraging equal opportunity amongst all workers, and applies to all employers, workers and job applicants.  Employment equity is about having a mix of all races and genders at every level of the organization from the lowest to the highest.

In terms of the Act, all qualifying organizations need to have all the requirements in place in order to comply.

Failure to comply may lead to prosecution and fines.


One of the important requirements is that employers must submit an annual employment equity plan report.

When should designated employers report?

Designated employers are required to report by 2 October 2017.

Who are designated employers?

Designated employers include the following:

  • Employers who employ 50 or more workers;
  • Employers who employ less than 50 workers, but has a total annual turnover that is equal to or above the applicable annual turnover of a small business in terms of Schedule 4 of the Employment Equity Act, as indicated in the table below;
  • An employer bound by a collective agreement, appointed as a designated employer in terms of the Employment Equity Act;
  • Municipalities; and
  • Organs of State.

What if workers’ numbers vary from time to time and only occasionally reach the 50 mark?

Employers who are designated and have been reporting, or should report, must continue to submit their reports until advised otherwise by the Department.

What about workers from temporary employment services?

Temporary workers who have worked for three consecutive months or more must be included in all reports to the Department of Labour even where they have been procured through an employment agency.

Labour consultants who employ 50 or more workers or whose turnover exceeds the threshold in Schedule 4 of the Act, as indicated in the table below, are required to report to the Department of Labour, and must therefore submit a report.


In terms of section 19 of the Employment Equity Act, all organizations with more than 49 employees or with a turnover in excess of the turnover threshold in Schedule 4 of the Act must comply. 

Sector Threshold – Total annual turnover
Agriculture R6 million
Mining and Quarrying R22.5 million
Manufacturing R30 million
Electricity, Gas and Water R30 million
Retail and Motor Trade and Repair Services R45 million
Wholesale Trade, Commercial Agents and Allied Services R75 million
Catering, Accommodation and other Trade R15 million
Transport, Storage and Communications R30 million
Finance and Business Services/td> R30 million
Community, Special and Personal Services R15 million

How we can help?

Veritas has significant experience in assisting clients with the changing terrain of regulatory and legislative compliance. We take a structured approach to enable clients to achieve and sustain compliance in an efficient and cost effective manner.

Our solutions help businesses to assess the impact of the Act and other legislation on their businesses as well as designing and implementing the changes required to ensure ongoing compliance.

This should be dealt with promptly to minimize the risk of potential non-compliance with this Act. 

For assistance in this regard please contact Helga Moreira, Tel:  015 590 1000, email:

For further information please visit our website:

We will gladly submit any additional information you may require.

This Alert is provided by Veritas Inc for information only, and does not constitute the provision of professional advice of any kind. The information provided herein should not be used as a substitute for consultation with professional advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all the pertinent facts relevant to your particular situation. No responsibility for loss occasioned to any person acting or refraining from acting as a result of using the information in the Alert can be accepted by Veritas Inc or any of the directors, partners, employees, sub-contractors or agents of Veritas Inc.

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