More than a hundred employers facing litigation at the Labour Court for not complying with transformation legislation could walk away with a slap on the wrist.
In addition to these 105 companies, the labour department took 72 JSE-listed companies on review in 2017/18, for failing to adhere to their own employment equity plans, according to sources in the department.
The department issued 60-day notices to them to comply. Most responded positively, including the JSE itself.
Of the 72 firms, nine were about to be served with summons. Five of them settled out of court and each paid a fine of nearly R1.5m. The department is preparing court cases against the remaining four companies which either didn’t have equity plans, or lied about reaching their targets.
Employers continued to ignore the 20-year-old Employment Equity Act. Department sources said this was because companies they’d taken to court, including local and international ones listed on the JSE, had in the past received minimal fines – ranging from R20 000 to R500 000. The act allows for a maximum penalty of R1.5m.
The sources blamed Labour Court judges for not imposing the maximum, saying this allowed a vicious cycle of non-compliance to continue.
“Some employers even pay these minimal fines from their own pockets. They’ve got nothing to lose. They would argue that by paying the maximum fine, jobs would be lost, but that’s not the issue,” said one.
“They ignore transformation, knowing that they will get away with paying small fines. Courts are not serious about transformation. They are failing us.”
Since the maximum fine permissible was increased from R500 000 to R1.5m in 2014, the courts had not imposed it, the source said.
Another source said employers were lying in their paperwork.
“Those that submit reports saying they are complying, get exposed during inspections because that’s when it is found out that they just ticked the boxes, but there are no actual changes on the ground.
“They submit reports that are misrepresenting what is happening at the workplace. When it is requested that they provide details of the people they claim to have employed, that information is not forthcoming.”
The department was taking action against both private companies and public sector institutions for suspected non-compliance.
One of the organisations being taken to court for allegedly not having an employment equity plan is the Tshwane University of Technology (TUT).
TUT spokesperson Willa de Ruyter said this was untrue. She said council – the university’s highest governing body – approved the 2018-2022 equity plan in November last year. It was submitted to the labour department in January this year. She offered to send City Press a copy.
However, the labour department source said inspectors found in October last year that TUT did not have a plan in place at that time, despite a report the university submitted in 2016, in which it stated that it had one. Employment equity plans, the source said, were valid for a year, or not more than five years.
De Ruyter said TUT had been complying all these years. TUT’s plan expired in 2015. Due to the #FeesMustFall protests at institutions countrywide that year, TUT delayed consultation with institutional stakeholders on its new plan.
She said drafting the plan started in 2014 already, knowing it would expire in 2015. This earlier initiation of the process would allow the institution to submit its subsequent 2016/17 plan on time. Last year, TUT submitted its draft 2018 plan to the department. TUT’s council approved it on November 24 last year.
The 12-month lapse between submitting the draft and the final plan was a concern for the department.
“However, the institution had a meeting with the department to address this matter. We believe that the concern was resolved, hence the council-approved plan was subsequently submitted,” De Ruyter said.
Another source said the JSE cooperated and was willing to comply. JSE spokesperson Pheliswa Mayekiso did not respond to questions sent on Friday.
Commission for Employment Equity (CEE) chairperson Tabea Kabinde was exasperated on Thursday, because of the lack of compliance, as she handed over the 18th annual report on transformation to Labour Minister Mildred Oliphant at the Saint George Hotel in Irene, Pretoria.
Kabinde said that after two decades, there was little to celebrate. She said racism, sexism and discrimination against people with disabilities had been holding back the country’s transformation agenda for the past two decades. These barriers existed in both public and private sector workplaces.
They were evident when employers dealt with recruitment procedures, selection criteria, appointments, remuneration and benefits and the terms and conditions of employment.
“We cannot continue like this. We need ethical leadership if we want to achieve compliance with the act. What we see in the workplace is the reflection of our society: racism, sexism and discrimination against people with disabilities. We need an honest and dignified discussion. We need to come to the table as citizens. We cannot afford to have antagonism every time we are discussing these things.”
Kabinde said there had been significant preference for employing foreign nationals over locals in some sectors, which could be a result of the availability of cheap foreign labour.
Harsher penalties and banning non-compliant employers from doing business with the state were some of the suggestions made at a CEE indaba on Thursday.
The CEE proposed an amendment of the act to state that compliant businesses be issued a certificate, to allow them to do work for the government.
Nathi Mncube, spokesperson for the office of the chief justice, said judges took legal disputes brought before them seriously. They took an oath to perform their duties independently, without fear or prejudice.
He said judges, when considering a fine in terms of the act, could exercise their discretion.
“There is no provision that suggests the judges shall impose a maximum fine of R1.5m.”
He said if the individuals in the labour department felt that judges were not doing their jobs properly, they should lodge complaints with the Judicial Service Commission. Alternatively, they could appeal against their rulings.
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