Employers association and Sakeliga promise an immediate challenge to targets based on race, gender and disability under the new Employment Equity Amendment Act. From Moneyweb.
The National Employers Association of SA (Neasa) and Afrikaans business organisation Sakeliga say they will combine forces to oppose new racial hiring policies in terms of the Employment Equity Amendment Act (EEAA) as unconstitutional, unlawful, and harmful.
The act, which became law in January 2025, sets hiring quotas for 18 economic sectors, from agriculture and mining to transport and construction.
The aim is to increase employment for “designated groups” such as blacks, women and those with disabilities.
It requires employers with 50 or more employees to ensure their employment equity plans conform with the new sector-specific targets. These plans must be prepared and implemented from 1 September 2025 to 31 August 2030.
“We believe that what the EEAA and regulations demand is unconstitutional, impossible, and harmful,” say Neasa and Sakeliga in a statement.
“The sectoral targets constitute strict hiring quotas, based on race and other demographic ratios, which the state seeks to enforce under penalty of 10% of turnover.”
The two organisations will launch an immediate joint legal challenge seeking an interdict against the operation of the regulations and targets introduced in terms of the act – and the act itself.
‘Totalitarian infringements’
“The state is acting unconstitutionally, because it makes totalitarian infringements on the freedom of businesses, owners, and employees to freely associate and trade,” they say.
“Under the guise of ‘transformation’, the EEAA insists on a stifling stagnation – that first all commercial activity and later, by implication, social activity should be conducted strictly in specified racial and other demographic ratios.
“The state is also doing great harm, because it destroys the productive capabilities of the economy and pits sections of society against each other, while empowering the state beyond its proper confines.”
Regulations under the act gazetted on Friday provide certain justifiable grounds for non-compliance with the new quotas, such as insufficient skills within designated groups, or the impact created by mergers or business transfers.
Employers with fewer than 50 employees are no longer required to prepare employment equity targets.
The act has been criticised by the Democratic Alliance (DA) and trade union Solidarity as unconstitutional, reviving apartheid-era limits on job opportunities based on race. The DA estimates this could result in around 600 000 job losses.
“Employment equity is costing SA billions of rand every year, over and above employers’ desperate efforts to find ways to not create more jobs,” says DA employment and labour spokesperson Michael Bagraim in Business Day.
“It is a disgrace that we still, in 2025, have so many race-based laws on our statute book. While most agree that we do need to rectify the wrongdoing of the past, the employment equity legislation has been shown to have failed.”
The policing of the act and its associated regulations will require 10 000 labour inspectors by the Department of Employment and Labour.
Minister of Employment and Labour Nomakhosazana Meth has praised the EEAA for reducing the regulatory burden on small businesses, allowing them to focus on growth rather than compliance.
Businesses with more than 50 employees will need to obtain compliance certificates to show their progress in meeting numerical targets – the aim being to address persistent inequalities in a labour market where roughly 17% of top management positions are held by blacks despite their 80% population share.
Employers advised to seek advice
Sakeliga and Neasa urge businesses to obtain proper legal advice on the act based on their individual circumstances.
“Employers should seek to minimise their legal risks while protecting their businesses, employees, and clients as much as possible in the face of such unconstitutional, unimplementable, and harmful legislation. This requires careful and personalised advice.”
Government’s attempts at racial transformation of the workplace are starting to face opposition after decades of acquiescence and fears of being labelled anti-transformation. That slur no longer has the same bite.
In December 2024, law firm Norton Rose Fulbright (NRF) filed papers in court challenging the Legal Sector Code – which sets firm-level targets of 50% black ownership, voting rights and executive management positions within five years.
NRF says these targets are unrealistic as blacks made up just 38% of the profession in 2023, and the introduction of the code was arbitrary, unlawful and procedurally flawed.
