The Employment Equity Amendment Act comes into operation on 1 August 2014 and has significant implications for employers.

Talita Laubscher, Director at pan-African corporate law firm, Bowman Gilfillan commented, “Amongst others, the Act further regulates the prohibition of unfair discrimination against employees, and the certification of psychometric testing used to assess employees. It also provides for the referral of certain disputes for arbitration to the Commission for Conciliation, Mediation and Arbitration (CCMA) as opposed to the Labour Court for adjudication.

“Also affected are the preparation and implementation of employment equity plans and the submission of reports by employers to the Director-General.” Ms Laubscher cautioned that the failure by a designated employer to have an employment equity plan in place or to implement its employment equity plan, may give rise to Labour Court proceedings and the Labour Court might impose a fine linked to the employer’s turnover for its failure to have plan in place.

Also included is section 6(4) which expressly accommodates claims of equal pay for work of equal value in the general prohibition against unfair employment discrimination.

As a result, Ms Laubscher advised that employers should scrutinise their pay practices to ensure that disparities in remuneration are objectively justifiable and are not grounds for claims of unfair discrimination.

Section 6(4) provides that a difference in the terms of employment between employees of the same employer performing substantially the same work or work of equal value that is based on any of the grounds listed in section 6 (1) of the Act (for example, race, gender, age, language and sexual orientation) or any other impermissible arbitrary ground is unfair discrimination.

To assess whether an employer has contravened the legislation it must be established that the work is the same or similar, or of equal value. Factors to be considered include the responsibility demanded of the work, the skills and qualifications required, and the physical, mental and emotional effort required to perform the work. The conditions under which work is performed may also be relevant.

“If a disparity in remuneration is based on a ground listed in section 6(1) or any impermissible arbitrary ground and there is no justification for such disparity, the employer will be at risk of a finding of unfair discrimination. In these circumstances, the Labour Court has wide ranging powers as regards the relief it might order,” said Ms Laubscher.

These include that the employer eliminates unfair discrimination and pays damages and compensation to the employee.

However, she added that there are various factors that could justify differentiation in pay, including the individuals’ respective seniority or length of service, and their qualifications, ability, competence or potential above the minimum acceptable levels required for the performance of the job. The individuals’ respective performance, quantity or quality of work can also be taken into account, provided they are subject to the same evaluation system.