15th of January 2020 is the deadline for the submission of your Employment Equity report. If you are a designated employer, with 50 or more employees, or if you are working on maintaining your BBBEE scorecard, then this is something that needs to be taken care of. With year-end around the corner and many businesses shutting down and staff going off on leave there are very few actual working days left to get your report submitted.
With all of the changes to the Income Differential (EEA4) regulated by the Department of Employment and Labour, you may need to factor in a little extra time than usual. Whether you are manually calculating your figures or sourcing your reports off your payroll software, there is a lot of checking to be done to ensure that the figures are correct. EEA4 requires designated employers to report in more depth about income differentials and is drilling down in not only the remuneration that employees of different occupational levels, race, and gender are receiving but also why types of financial difference there are in the remuneration packages. With employers having to declare both fixed and variable incomes in order to highlight the difference in the types of benefits that employees are receiving.
If your company has not yet designed or implemented a remuneration policy with affirmative action measures to identify how to reduce the income differentials, its time to do so now. Another new aspect of the report is that employers are required to calculate what the difference is between the lowest-paid employees and the highest-paid employees within the company with the view that that difference should not exceed an amount of RX x 11. In other words, when taking the remuneration of the lowest-paid employee within the company, multiply that by eleven and this is where you should be able to see the salaries of the highest paid employees within the company. If your figures exceed x 11 a remuneration policy needs to be drafted which will identify ways in which this difference will be reduced. Consider this as part of your next Employment Equity Plan and include this when next performing your barrier analysis of the policies, procedures and practices within your company.
Going forward, companies can expect the Department of Employment and Labour to be more involved in the meeting of goals and targets and when targets which are not met, this may result in Director-General reviews where you will be held accountable for attaining compliance. Failure to do so may result in the prescribed timeframe will result in your organisation being referred to labour Court in terms of Section 45 of the Employment Equity Act. If an employer fails to comply with the request made by the Director General in terms of Section 44(b), the Director General may refer any non-compliance by the employer to the Labour Court.
Employment Equity Report is a moving landscape to which the employer must rapidly adjust as and when required. Failure to do so may cause your organisation to face catastrophic consequences.
