Equity Bill bulldozed through committee

….article dated 4 July 2021…….

Minister intent on setting BEE targets…

The unusually large number of objections from business to the “cavalier approach” by Minister Thulas Nxesi on the fixing of BEE targets for various sectors in terms of the newly proposed Employment Equity Amendment Bill have clearly not been listened to by Department of Employment and Labour (DEL) or the Cabinet.

MPs have now met to hear the response of the department in the form of an ‘A’ list, which is made up of the originally proposed EE Bill re-printed with any subsequent changes made as a result by the Minister as a result of three days of parliamentary hearings and two committee debates.

Clearly the Minister has become totally intransigent on the idea of any watering down on his basic proposals focusing on his drive to bring about further black empowerment by law. The move cancels out the “voluntary” aspect of BEE promised when the process was agreed at NEDLAC.

Little change

It was also self-evident from the meeting that the Minister had moved very little on the major issue of his requirement for thirty days’ notice given to a business for  information required by DEL to set sector-specific targets for industry and businesses.

It had been put to him that the manner of application being proposed to bring about target achievement for black empowerment was too broad for any serious or practical application at workshop or floor level. Most submissions from business and industry in hearings, and in earlier submissions, were in total disagreement with the process by which the Minister would select targets and with the absence of any agreed process in the setting of same.

Carte Blanche

This now means, say critics of the Bill, that DEL can make any regulations they wish without guidelines, parameters or even discussion without reference to any anchor Act  and with the force of law behind them. Opposition parties say they will abstain from voting on the legislation as it offends the Bill of Rights and is both objectionable and racist.

The meeting was called so that DEL could respond to all submissions in the knowledge that debate would follow later.

Stepping on the gas

The Employment Equity Amendment Bill was first introduced by Minister Nxesi in July 2019. proposing a number of radical changes to equity law, seen at the time as essentially taking back what was a “voluntary” system of equity target setting by business and industry and substituting this with a system whereby the Minister rather dictates the process, sets the targets and disciplines defaulters.

The Bill’s progress in drafting was considerably delayed by the spread of the Covid 19 pandemic, it was claimed by DEL some months earlier thus contributing little to the Minister’s black empowerment plan to speed up the execution of transformation, expressed as urgent by President Ramaphosa.

As a result, the “EE Bill” has therefore taken a forward motion of its own and has become the major focus of DEL’s policy execution since Minister Nxesi cracked the whip.

On the cards

A number of clauses appear to have been amended slightly but on the major issues the  following chsnges were made for the National Assembly vote to be presented by the Minister are:

  • On the issue of consultation with business and industry to enable the setting of sector specific targets, the Bill now reads, “The Minister may, after consulting the relevant sectors and with the advice of the Commission, for the purpose of ensuring the equitable representation of suitably qualified people from designated groups at all occupational levels in the workforce, by notice in the Gazette set numerical targets for any national economic  sector identified etc”.
  • On the issue of labour inspectors, the Bill now reads, “A labour inspector, may serve a compliance order on a designated employer in the prescribed manner if that employer has failed to comply with sections 16 etc”. On reading this it can be seen that “or any person acting on behalf of a labour inspector” has been removed.
  • Subsection 4(3) has been altered to read:- “The Minister may, after consulting the relevant sectors and with the advice of the Commission, for the purpose of ensuring the equitable representation of suitably qualified people from designated groups at all occupational levels in the workforce, by notice in the Gazette set numerical targets for any national economic sector identified ….”
  • The sentence, page 5 line 5, that appeared dictatorial, has been corrected to:- whether the employer has complied with a sectoral target set in terms of section 15A applicable to that employer…  This previously read….. whether or not the employer…..
  • The long title of the Bill has been altered, as per italics, to read : To amend the Employment Equity Act, 1998, so as to amend a definition; to insert certain definitions, to substitute a definition and to delete a definition; to provide for the Minister to identify sectoral numerical targets in order to ensure the equitable representation of suitably qualified people from designated groups, to provide criteria for the Minister to issue certificates; and to provide for matters connected therewith.

Against

The Democratic Alliance was represented by Michael Bagraim who said that the whole Bill was objected to since his the party did not agree at all with the manner in whichthe Bill was being dealt with in the first place.  This was plainly another piece of social engineering, Bagraim said.   “This idea has never worked and never could work, as was seen with apartheid”, he said.

Bagraim added, “Such practices as are espoused in these proposals are dangerous manipulation, as was seen with the Nazis and the holocaust”.  He objected to the amendments, in principle he said, simply because he objected to any BEE legislation of the sort and of any kind social manipulation with such laws”.

The FF+ also said they would vote against the amendments as a whole.  The ANC said they agreed with the amendments and consequently the ‘A’ list goes forward for full debate.

Shut down

However, at the particular meeting, heated debate started with opposition members complaining about the use of such expressions in the Bill as “When the Minister is satisfied”, “Suitably qualified” and the use of the word  “Prescribed”.

Words like ‘dictatorial” and ‘arrogance’ were flung about by MPs with buttons being pressed everywhere but eventually the Chair interceded to point out that the virtual meeting should be confined, in terms of parliamentary rules, to MPs acceptance and the briefing by DEL, the ANC having used their majority to accept the proposals.

Any further debate, Lindelwa Dunjwa said, could be held when the Bill goes forward to the National Assembly for adoption.

Recent comment

Earlier in hearings, the SA Institution of Civil Engineers (Saice) said in the parliamentary hearings to weeks before, “Forcing companies to adhere to targets in the manner proposed is not only unconstitutional but is in total conflict with what has been drafted so far with a Public Procurement Bill which is aimed at eliminating fragmented targeting by the state on a “here and there” basis. Now the EE Bill will do this because there is no basic plan of action and the targets set will be totally ‘ad-hoc’, set after dozens of different meetings, different circumstances, different conditions, different markets.”

BUSA disliked the Bill intensely also, their Tom Moyane telling MPs, “The EE Bill contravenes the constitutional procurement principle that when a state organ contracts for goods or services it must do so in accordance with principles of fairness, equitability, transparency, competitiveness and cost-effectiveness.”  This Bill does none of these things”.

Whistle stop

With the pressure now on Minister Nxesi to perform, and DEL Chief Director Thembisile Mokoena so determined at the meeting in question, expect to see speedy approval of the plan in the National Assembly, but not without an outcry. The President’s signature will undoubtedly added shortly afterwards.

Clearly the Cabinet means business with this Bill.

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