COVID-19 and the impact on Employment Equity compliance

COVID-19 and the impact on Employment Equity compliance

COVID-19 and the impact on Employment Equity compliance

Amongst the many unfortunate negative impacts that the Covid-19 pandemic has had on the life-styles, well-being and health of people all over the world, the harsh reality is that in our country, where the economy was already volatile and plagued by unemployment, it was inevitable that the business sector would also suffer a dramatic loss.

This loss as a result of the imposed lockdown, which prevented income generation and placed businesses under severe financial strain , also had a cascading effect on other businesses.

Some of the unfortunate companies that found themselves in dire financial straits resorted to pay-cuts and even retrenchments.  

With the implementation of stricter safety measures to curb the spread of the virus, companies were forced to alter their approach to client services and to possibly amend their policies and procedures.

This poses a few Employment Equity questions such as: what criteria would be used to select employees for retrenchment without violating any Affirmative Action measures in your company’s EE plan? What impact would the company’s new overall demographic representation have on the Goals and Targets as per the EE plan? Would amending policies and procedures create new barriers?

The purpose of this article is to clarify some of these burning Employment Equity compliance questions.

Employment Equity and retrenchments

In a letter sent to all Designated Employers, the Commission for Employment Equity (CEE) recognises that ‘organisations will be exploring various Covid-19 Response and Recovery Plans with regard to Business Continuity.'

In the unfortunate instance where retrenchment is the only viable option in order to avoid closure, many companies might assume that the code of good practice recognises the LIFO (last in, first out) principle as being the fairest, but what if the company’s most recent appointments were made for the purpose of achieving EE goals and where these positions are more beneficial to the continued functioning of the business than other positions?

By considering how Covid-19 has affected the industry within which the company falls, this could assist in identifying certain services or operations provided by the company as having become obsolete, resulting in some positions being redundant. In the case of retrenchments, it will be difficult to find a balance between the need to preserve transformation gains and an attempt to keep the company operating effectively with essential employees, but provided your company’s retrenchment process can be justified and remains free from discrimination based on race, gender, age, etc. there shouldn’t be any cause for concern regarding compliance with EE legislation.

Employment Equity and designated employers

The aforementioned letter also states that ‘designated employers are requested to strive not to reverse the previously attained transformation gains, including to where reasonably practical, achieve their initially planned annual EE targets for 2020. In instances that it is practically not possible to maintain and achieve the initially planned EE targets, the employers may consider reviewing and amending their EE Plans in consultation with the EE Consultative Forums (Sections 16 read with 17 of the EEA), but must document all the reasons for the changes as prescribed in the Employment Equity Regulations, 2014’.

Therefore, by allowing the company’s Employment Equity Committee (EE consultative forum) to redo the analysis (EEA12) that had been performed prior to compiling the current Employment Equity Plan (EEA13), the the new workforce representation after the process of retrenchments can again be compared to the relevant Economically Active Population (EAP) percentages. The EAP is the basis for the EE Goals and Targets. The under-representation of the Designated Group throughout the occupational levels can then be determined, after which the company’s Employment Equity Plan can be amended accordingly.

In conclusion

Overcoming Employment Equity barriers is regarded as the main purpose of the EE Act. Barriers exist in the organisation’s policies, procedures, practices and working environments if they adversely affect persons from the Designated Group when it comes to advancement, development and retention.

Should a company amend any of its policies, procedures or practices, and in some cases if Covid-19 has had an effect on the working environments of employees, this too should be discussed within the EE consultative forum to ensure that Affirmative Action measures are put in place to overcome any identified barriers. Examples of areas where barriers could exist include ‘recruitment and selection policies’, ‘performance and evaluation systems’ and ‘training and development’, etc.

SERR Synergy assists businesses with Employment Equity compliance by providing professional advice and the highest standard of service delivery. Our team ensures that your company’s Employment Equity plan and reports are compiled and submitted accurately to the Department of Labour.

About the Author: Gareth Ras started his career in employee development and training in 2006 and qualified as a Skills Development Facilitator in 2009, thereafter acquiring over 11 years of experience as a Skills Development and Employment Equity consultant having worked with well over 250 companies in different industries.

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