Human Rights Committee
THE EMPLOYMENT EQUITY BILL
Submission to the Portfolio Committee on Labour by the Human Rights Committee
20 July 1998
The Employment Equity Bill is the third in a suite of labour legislation aimed at transforming the South African workplace. It is also aimed at giving effect to the constitutional right to equality by specifically prohibiting unfair discrimination in the workplace. Furthermore, it promotes positive measures aimed at advancing persons or categories of persons disadvantaged by unfair discrimination.
The Human Rights Committee welcomes the introduction of the Employment Equity Bill because we believe it will contribute towards the attainment of substantial equality for all South Africans. However, the success of the Bill is largely dependent on effective monitoring, implementation and enforcement.
In order to contribute towards ensuring that employment equity becomes a reality in South Africa, our submission is focussed on commenting, raising questions and making recommendations on the monitoring, implementation and enforcement provisions of the bill.
Chapter II: Prohibition of unfair discrimination
Section 10 - Disputes concerning chapter II
1. The different procedures prescribed
The Bill provides different dispute resolution procedures for;
• unfair dismissals,
• harassment, and
• "other" unfair discrimination disputes.
Unfair dismissal disputes will be dealt with according to the provisions in the Labour Relations Act (LRA). The LRA provides that unfair dismissal disputes must be referred to the CCMA for conciliation within 30 days. If the dispute is not resolved by conciliation or remains unresolved 30 days after the date of referral, either party to the dispute may take the matter to the Labour Court.
Harassment disputes "must be dealt with in terms of the relevant provisions of the LRA". What provisions the bill is referring to here is not clear. For sexual harassment, one might assume that the bill is referring to the recently drafted Code of Good Practice on the handling of sexual harassment cases and the Code’s reference to section 135 of the LRA. However, for other harassment disputes, for instance harassment based on race, there are no provisions provided in the LRA, save for the general dispute resolution procedures in Chapter VII.
For sexual harassment disputes, the Code provides that an aggrieved party must refer the dispute to the CCMA for conciliation within 30 days of the dispute having arisen. If the dispute remains unresolved, either party may take the matter to the Labour Court. However, the status and enforceability of the Code is unclear given its guideline nature.
"Other" unfair discrimination disputes must be resolved according to the provisions of section 10 (2), (4), (5), (6), (7), and (8) of the Bill. These provisions provide that a dispute must be referred to the CCMA for conciliation within 6 months of the dispute having arisen. If the dispute remains unresolved, either party may take the matter to the Labour Court, or if both parties consent, the matter may be referred to arbitration.
2. Sexual harassment disputes resolution procedure
Given the lack of specific provisions in the LRA and the guideline nature of the Code of Good Practice, the procedures for resolution of sexual harassment disputes are unclear.
In South Africa sexual harassment in the workplace is commonplace, yet is seldom reported. In order to encourage victims to come forward and to begin to create a culture of non-acceptance of sexual harassment in the workplace, it is important that the bill is very clear on how a victim may seek redress.
Furthermore, the procedures prescribed in the Code of Good Practice differ from the procedures for the resolution of other forms of unfair discrimination in regard to the time limit in which the victim must refer the dispute to the CCMA. In cases of sexual harassment the dispute must be referred within 30 days while complainants alleging other forms of unfair discrimination are given 6 months to refer the incident.
It is HRC’s recommendation that the referral of harassment disputes should not be removed from the ambit of the Employment Equity Bill and should not be limited to a 30 day period, but should be treated as any other form of unfair discrimination. We suggest the following:
a) The procedures for the resolution of harassment disputes should be stipulated in the Employment Equity Bill and not the LRA. To achieve this objective, we recommend the deletion of section 10 (3) and the amendment of section 10(2) through the removal of the words "other than an allegation of harassment".
b) The Code of Good Practice on the handling of sexual harassment cases should be appended to the Employment Equity Bill and not the LRA.
c) In the alternative, if the committee decides to leave the bill as is, we would recommend that the Code of Good Practice on Sexual Harassment be amended to give the party a 6 month period in which to refer the incident(s).
3.1 Appropriateness of Conciliation in discrimination cases
There is considerable evidence to show that conciliation may be inappropriate in resolving discrimination disputes unless they have been properly screened. Some of the reasons for this are:
• Where conciliator success is linked to settlement rates, disputants may be vulnerable to manipulation by the conciliator. The drive to settle disputes arising from the Bill may be exacerbated in CCMA proceedings since that agency places considerable emphasis on settlement in conciliation without any or adequate evaluation of the quality of outcomes.
• Where a complainant in a dispute arising from alleged discrimination is not adequately represented, the impetus to settle is not always appropriate1. Complainants may be nudged into settling too early due to power imbalances which are inherent in discrimination cases.
• The privacy of conciliation may mask recidivism and systemic discrimination especially in cases of harassment. The conciliation process is a private one and the proceedings without prejudice to either party, therefore a Commissioner conciliating a dispute under the Bill will have no power to report cases of repeat offences to the Commission on Employment Equity, Director General or a Labour Inspector.
3.2 Proposed safeguards in the conciliation process
We recommend, for the reasons set out above, that advocacy groups, specialist non-governmental organisations and agencies such as the South African Human Rights Commission and the Commission for Gender Equality be allowed to represent or arrange representation for complainants at conciliation. We would further suggest that the Commission on Employment Equity be given the authority and resources to undertake such an advocacy function (on a limited scale).
We suggest the following wording for a clause on "representation at conciliation":
" In conciliation proceedings a party to the dispute may appear in person or be represented by a co-employee or by a member, an office bearer or official of that party’s trade union or employer’s organisation or by a representative of the SAHRC, CGE, or other human rights organisation registered with the CCMA and, if the party is a juristic person, by a director or an employee."
We recommend that a specialist division within the CCMA, (or other agency accredited by the CCMA), should be authorised to screen all disputes of alleged discrimination lodged under Chapter II to assess whether they are appropriate for conciliation or formal hearing - whether by arbitration or litigation.
3.2.3 Fact-finding in conciliation
Evidence in a number of jurisdictions (UK, Australia, Canada and N Ireland)2 suggest that complainants in discrimination cases often find it extremely difficult to put together coherent evidence in discrimination disputes, especially where the allegation arises from alleged indirect or unintended discrimination. The reason for this is not simply that the evidence is difficult to come by but that the victims of such discrimination are lay persons who are not trained in this difficult and unexplored area of law.
In terms of the definition of conciliation in the LRA, which needs to be read into the Bill, conciliation may include "conducting a fact-finding exercise"3. This would typically be dedicated to finding settlement of the dispute rather than as part of advocacy or trial preparation.
Fact-finding will be particularly necessary in unfair discrimination disputes and it is important that complainants be assisted in building their cases. We submit that the CCMA is not the appropriate body to conduct this work because its credibility as a neutral disengaged dispute resolution agency would be jeopardised by identification with the cause of the complainants.
We recommend that this kind of fact-finding which would be to help a complainant prepare his or her case should be done by an agency dedicated to promotional/advocacy work, whether an NGO or agency such as the CEE, SAHRC or CGE.
3.2.4 Approval of settlements
In the absence of adequate representation in conciliation hearings, there is a likelihood that an individual complaint will be resolved yet the environment, which generated the complaint, remains unaffected. Already experience at the CCMA in dealing with the few discrimination cases that have been referred to it has shown that repeat offenders often pay their way out of many individual disputes. Systemic discrimination is then left unaddressed.
One way to get around this problem, would be to confer on a CCMA commissioner some authority to approve settlements (as in Canada4). This would act as a barrier to an employer strategy to ‘pay off’ a complainant and to thereby sustain the systemic discrimination. In order to circumscribe this power of approval, the bill could prescribe the circumstances where commissioners may consider withholding approval.
Section 10(7) provides:
"If the dispute remains unresolved after conciliation -
(a) any party to the dispute may refer it to the Labour Court for adjudication; or
(b) all parties to the dispute may consent to arbitration of the dispute."
4.1 Access to the legal system
Experience in the current labour relations environment has shown that individual employees are hard pressed to pursue their cases in the Labour Court. The major consideration is the prohibitive cost of bringing a Labour Court application. Delays in having the matter heard, exacerbated by the fact that the employment relationship continues while the case is pending, are further considerations which often force indigent complainants to settle too low or not to pursue their case where conciliation fails.
It is essential to develop unfair discrimination jurisprudence in South Africa as soon as possible and therefore barriers to good cases reaching the courts should be recognised and adequately addressed. HRC recommends that a fund should be set up to cover the litigation costs of indigent complainants who have good cases. The fines collected for non-compliance with provisions of the Act could be kept in a separate fund and used for such purposes.
4.2 Need for advocacy agency with locus standi authority to litigate
Some agency ought to have authority to litigate on behalf of individuals or groups.
In the United Kingdom both the Commission on Racial Equality and the Equal Opportunities Commission (EOC) have advisory, research and promotional jurisdiction. Research into the efficacy of these commissions suggests that their success depends on an integration of their promotional functions and their litigation work. Alice Leonard legal advisor to the British Equal Opportunities Commission in ‘The role of the British Equal Opportunities Commission in combating sex discrimination’5 shows that although the EOC has a very small budget, its capacity to integrate research to underpin its policy and legal work are critical to its success6.
Given the fact that the CEE has no power under the Bill to litigate on behalf of complainants, we recommend that the policy formation and promotional work of the CEE be integrated into strategic litigation by agencies or individuals such as the SAHRC and CGE.
It is clear that in the absence of adequate budgets, the SAHRC and CGE will not be able to take on test cases. We would suggest increasing the litigation budgets of these bodies through specific allocations from the Labour department for Employment Equity Bill cases.
Chapter III: Affirmative Action
Section 19 – Analysis
Section 19 requires a designated employer to conduct an analysis in order to identify employment barriers, which adversely effect people from designated groups. The bill prescribes that the employment equity plan must be made available to employees for copying but there is no similar provision regarding the findings of the analysis. In order to ensure real consultation regarding the preparation of an employment equity plan, the employees will need to have access to the findings of the analysis.
HRC recommends that once the employer has consulted with the employees and conducted the analysis, the findings should be made available to the employees for copying and consultation. This amendment could be made in section 19 or section 25, the section which deals with the employer’s duty to inform the employee.
Section 20 – Employment equity plan
Contrary to popular opinion, there is no provision in the bill which requires designated employers to submit their employment equity plan to the Labour Department. In fact the provisions in section 42 indicate that the Director General will not have access to employment equity plans, but may request an employer to submit a copy of its employment equity plan in order to assess whether the employer is complying with the bill’s provisions.
HRC recommends that the employer should be obliged to submit its plan as part of its annual report on progress made towards the achievement of employment equity.
Section 21 – Report
The bill provides in section 21(4) that the report must contain the "prescribed information".
As said above, the bill does not require an employer to submit their employment equity plan to the DG, yet it seems to be implicit that the DG will need to see the plan to assess whether the employer has made reasonable progress. Similarly, the DG will need to see the findings of the analysis conducted by the employer.
In the light of the above, HRC suggests that section 21(4) read as follows.
"The reports referred to in subsections (1) and (2) must contain a copy of the analysis conducted in terms of section 19, the employment equity plan
prepared in terms of section 20 and other prescribed information".
Disputes about the interpretation and application of chapter III and failure to agree on an employment equity plan
A previous draft of the Bill contained a provision7 that disputes about the interpretation and application of chapter III had to be referred to the CCMA for conciliation and in some cases arbitration. It read:-
(1) Any party to a dispute about the interpretation or application of any provision of this Chapter may refer the dispute in writing to the CCMA.
(2) A dispute in terms of subsection (1) may be referred only within six months after the act or omission that forms the subject of the dispute.
(3) At any time, the CCMA may permit a party who shows good cause to refer the dispute after the relevant time limit set out in subsection (2).
(4) The party who refers a dispute must satisfy the CCMA that -
(a) a copy of the referral has been served on every other party to the dispute; and
(b) the referring party has made a reasonable attempt to resolve the dispute.
(5) The CCMA must attempt to resolve the dispute through conciliation.
(6) If the dispute remains unresolved after conciliation, any party to the dispute may request the CCMA to resolve the dispute by arbitration.
(7) The relevant provisions of Part C of Chapter VII of the Labour Relations Act, with the changes required by context, apply in respect of a dispute in terms of this Chapter.
The current Bill has no such dispute resolution mechanism. This has the problem that there is ostensibly no clear statutory way of resolving disputes which arise out of the interpretation and application of the Chapter.
The following issues remain unclear:
1. Designated employers
Chapter III in section 12 expressly states that "except where otherwise provided, this Chapter applies only to designated employers".
The Bill is silent on how a dispute over whether an employer is a designated employer should be handled. Under a previous draft of the Bill, the CCMA would have had the powers to conciliate and if necessary arbitrate such a dispute. This is an important point since the labour inspectorate and the Director-General can only require compliance of a designated employer. Any dispute over whether an employer constituted a designated employer would have to be settled first.
2. Failure to agree on an employment equity plan
2.1 Dispute of mutual interest?
It is unclear what happens in the case of a failure to agree on an employment equity plan. It is possible that this might be considered a dispute of mutual interest under the LRA. If so, the Department of Labour would have no jurisdiction and the scope of the CCMA’s jurisdiction to arbitrate would be limited to giving directions on process (analogous to the jurisdiction of the CCMA in terms of section 21 of the LRA in respect of organisational rights). The CCMA would have no jurisdiction to determine the plan itself.
Presumably also, an employer would be entitled to make an employment equity plan over the objection of employees, whether unionised or not, so long as it has complied with the process requirements of consultation8. The extent of the employer’s obligations are to attempt to reach consensus, but where no consensus is reached the employer can go ahead and implement its plan.
2.1 Right to strike?
Since no dispute resolution mechanism, other than an a compliance order, is provided for in the bill to deal with a failure to agree on an employment equity plan, it would appear that employees would be entitled to initiate protected strike action and employers to lock-out (also protected). This appears to be countenanced by the LRA in section 64 and section 65(1)(c). Section 65(1)(c) states that "no person may take part in a strike or lock-out or in any conduct in contemplation or furtherance of a strike or a lock-out if - …the issue in dispute is one that a party has the right to refer to arbitration or to the Labour Court in terms of this Act".
The thrust of the new labour dispensation is to promote employee participation in decision-making in the workplace and to promote industrial peace and the effective resolution of disputes. In view of this we recommend that the Bill be consistent in allowing for CCMA conciliation and arbitration in respect of the failure to reach agreement on a plan since this is already allowed for in the case where a workplace forum has been established.
Section 16(3) states that "This section does not affect the obligation of any designated employer in terms of section 86 of the Labour Relations Act to consult and reach consensus with a workplace forum on any of the matters referred to in section 17 of this Act".
Under section 86 of the LRA an affirmative action plan is a matter for joint determination and failure to agree does not give rise to a right to embark on a protected strike or lock-out. In any dispute which arises from the failure of parties in a workplace forum to agree; the CCMA would have jurisdiction to make a plan by arbitration but this would be in terms of the LRA rather than the Bill.
We would argue that this approach should be extended to cover all circumstances where the dispute involves a failure to agree on an employment equity plan.
3. Primacy of Collective Agreements
The LRA underlines the principle of respect for the primacy of collective agreements9. Thus where consensus has been reached in terms of a collective agreement - also in the case of an employment equity plan - an arbitrating or adjudicating party would be mindful of the agreement reached inter partes and not easily overturn or set it aside. It is unclear from the Bill to what extent the Department of Labour or the Director-General will be mindful of this principle. In the interests of consistency, we recommend that this principle also be enshrined in the Bill.
4. We suggest the following wording for a new section 27:
(1) Any party to a dispute about the interpretation or application of sections 12, 16, 17 and 18 of this Chapter may refer the dispute in writing to the CCMA.
(2) All disputes regarding the interpretation or application of sections 13, 14, 15, 19, 20, 21,22, 23, 24, 25 and 26 must be referred to the Department of Labour.
(3) A dispute in terms of subsection (1) may be referred only within six months after the act or omission that forms the subject of the dispute.
(4) At any time, the CCMA may permit a party who shows good cause to refer the dispute after the relevant time limit set out in subsection (2).
(5) The party who refers a dispute must satisfy the CCMA that -
(a) a copy of the referral has been served on every other party to the dispute; and
(b) the referring party has made a reasonable attempt to resolve the dispute.
(6) The CCMA must attempt to resolve the dispute through conciliation.
(7) If the dispute remains unresolved after conciliation, any party to the dispute may request the CCMA to resolve the dispute by arbitration.
(8) The relevant provisions of Part C of Chapter VII of the Labour Relations Act, with the changes required by context, apply in respect of a dispute in terms of this Chapter."
(The disputes which would fall to the CCMA all have to do with process, while those which fall to the Department have to do with the substance of employment equity.)
Chapter IV: Commission for Employment Equity
Section 27 - Establishment of Commission for Employment Equity
It is noted that the proposed commission is essentially promotional and advisory in nature. Furthermore, confusion may exist between the CCMA and the CEE. In light of the above, HRC suggests that the name be changed to the Employment Equity Advisory Committee (EEAC).
Section 28 – Composition of Commission for Employment Equity
It is vital that the people who are appointed to serve on the Commission represent the interests of all the designated groups.
Section 28(3) requires Nedlac to have due regard to promoting the representivity of people from designated groups when nominating candidates. If the Minister is of the opinion that Nedlac did not have due regard, s/he may ask Nedlac to reconsider and make new nominations. The wording used however does not place an obligation on the Minister to have due regard to promoting representivity of persons from designated groups when making the appointments.
HRC suggests that the bill should place an express duty on the Minister to have due regard to promoting the representivity of people from designated groups when appointing Commissioners. This could be achieved by inserting a sub-clause worded as follows:
"When appointing the commissioners in terms of subsection (1), the Minister must have due regard to promoting the representivity of people from designated groups."
Section 32 – Report by Commission for Employment Equity
The bill provides that the Commission must submit an annual report to the Minister.
HRC recommends that the bill should prescribe what the report should contain. We would suggest the following:
• the Commission’s work plan for the year being reported on
• policies adopted
• public hearings held and reports on the findings of the hearings
• litigation undertaken or supported
• Codes of Good Practice drafted or advised upon
• complaints of alleged contraventions of the Act received and how these allegations were attended to or who they were referred to
• research undertaken
• other information prescribed by the Minister in regulations
We further recommend the bill provide that the Minister must table the report in Parliament within 14 days of receipt (Although the Constitution requires a Minister to table reports concerning matters under his/her control, the Minister is not obliged to table the Commission’s report but may table his/her own diluted report). Such an amendment was recently effected to the tabled version of the National Prosecuting Authority Bill.
Chapter V: Monitoring, Enforcement and Legal Proceedings
Section 33 – Monitoring by employees and trade union representatives
Who may report alleged contraventions
Section 33 provides:
Any employee or trade union representative may bring an alleged contravention of this Act to the attention of:-
(a) another employee;
(b) an employer;
(c) a trade union;
(d) a workplace forum;
(e) a labour inspector;
(f) the Director-General;
(g) the Commission.
HRC suggests that it is too limiting to allow only employees or trade union representatives the right to report cases of alleged unfair discrimination or non-compliance with the bill’s employment equity provisions.
The section should be redrafted to give any person the right to bring an alleged contravention of the Act to the attention of different agencies. We would therefore suggest that "any person" replace the words "Any employee or trade union representative".
It is also unclear what these various people or bodies will do with the information reported to them. We recommend that the bill should specify what each agency is required to do with complaints received and should also oblige the agencies to report on the referrals received and their actions taken.
Section 35 – Undertaking to comply and
Section 36 - Compliance order
Initiating the compliance procedure
The Bill is silent on how the compliance procedure can be initiated. Presumably there are a variety of ways, the most obvious one being the reporting of an alleged contravention of the Act to a labour inspector.
What is unclear is whether the labour inspectorate is obliged to intervene on request in the same way that the CCMA is obliged to conciliate and arbitrate on referral of an alleged dispute or whether the inspectorate is entitled to investigate an allegation of contravention.
Section 45 – Conflict of proceedings
We are concerned by the negative effect on individual complainants and employers due to potentially lengthy delays inherent in the bill’s provisions regarding review by the DG and referral to the Labour court. We recommend that individual cases alleging unfair discrimination should be proceeded with irrespective of the stage of completeness of the DG or Labour Court’s investigations into systemic discrimination and non-compliance at the workplace.
Section 49 – Powers of Labour Court
Remedies for unfair discrimination cases
Section 49(2) provides:
"If the Labour Court decides that an employer has unfairly discriminated against any employee, the Court may make any appropriate order that is just and equitable in the circumstances, including -
(a) payment of compensation by the employer to that employee;
(b) payment of punitive damages by the employer to that employee;
(c) an order directing the employer to take steps to prevent the same unfair discrimination or a similar practice occurring in the future in respect of other employees;
(d) an order directing an employer, other than a designated employer, to comply with Chapter III as if it were a designated employer;
(e) an order directing the removal of the employer’s name from the register referred to in section 40; or
(f) the publication of the Court’s award.
On a restrictive reading, the bill provides for re-instatement, compensation or punitive damages but not a combination of all three (note the use of the word "or" instead of "and"). We would suggest the use of the word "and" to ensure an interpretation which allows for a combination of all three.
There is a question whether the Labour Court has a discretion to impose punitive damages if these have not been pleaded.
Evaluation and assessment
There is no provision in the bill for any thorough assessment of the efficacy of the bill. It is suggested that the bill should make clear provision for a review of the employment equity programme within a specific or determinable period.
As a last comment we would like to suggest that the flow diagrams, which were attached to a previous draft of the bill, depicting the various dispute resolution mechanisms and compliance order procedures, should be appended to the bill.
The dispute resolution and enforcement procedures need to be clear and easy to access in order for employment equity to become a reality in South Africa. It is in this context that we ask the Labour Portfolio Committee to consider our comments and questions and to thoroughly investigate the dispute resolution, implementation and enforcement provisions provided in the bill.