If you’re running a business with more than 50 employees or hit certain industry turnover thresholds, congratulations – you’re now a “designated employer” under the Employment Equity Act. And that means you need to get serious about compliance, starting with appointing the right people to manage your Employment Equity (EE) requirements.
What Makes You a Designated Employer?
The Employment Equity Act has been around since 1998, and it’s pretty straightforward about who needs to comply. If you employ more than 50 people or your annual turnover meets specific industry thresholds, you’re in. No exceptions, no excuses.
This designation comes with real responsibilities – and real consequences if you don’t get it right. We’re talking potential fines of up to R2.7 million or 10% of your annual turnover. Plus, non-compliance kills your B-BBEE Management and Control points entirely.
The Key Players You Need to Appoint
Here’s where many businesses trip up: you can’t just wing Employment Equity compliance. You need dedicated people in specific roles, and it all needs to be properly documented.
The EE Manager is your point person for all Employment Equity activities. This isn’t a side-job or something you can dump on HR as an afterthought. This person needs a formal appointment letter signed by both the CEO and the EE Manager themselves. No shortcuts here.
EE Committee Members also need formal appointments with signed letters from both the CEO and each committee member. The committee isn’t optional – it’s a legal requirement, and they need to meet regularly and keep proper minutes.
What These Roles Actually Do
Your designated employees aren’t just there to tick boxes. They have real work to do:
Communication and Awareness is a big part of the job. They need to create EE awareness materials, provide internal training, and make sure those required Employment Equity and Basic Conditions of Employment posters are displayed where employees can see them.
Committee Management means establishing the EE Committee, scheduling regular meetings, and keeping detailed minutes. The Department of Labour wants to see evidence that you’re actively working on employment equity, not just going through the motions.
Analysis and Planning involves the heavy lifting of compliance. Your EE Manager needs to complete the EEA12 analysis, develop comprehensive EE Plans using the EEA13 forms, and submit the required EEA2 and EEA4 reports annually.
Why This Matters for Your Business
Beyond avoiding hefty fines, proper Employment Equity compliance directly impacts your B-BBEE scorecard. The Management and Control element can make or break your B-BBEE level, and you can’t earn any points here without proper EE compliance.
But there’s more coming. President Ramaphosa has signed the Employment Equity Amendment Act into law (though the commencement date isn’t set yet), and the new requirements go way beyond just plans and reports. You’ll need comprehensive policies covering recruitment, retirement, training, and employment equity, plus properly functioning EE and Training Committees that sync with your Workplace Skills Plans.
Getting Your Appointments Right
The devil is in the details when it comes to appointing your EE Manager and committee members. Both the CEO and each appointee must sign the appointment letters – this isn’t negotiable. The Department of Labour specifically looks for these documents during inspections.
Your EE Manager should ideally understand both the legal requirements and your business operations. This person will be your primary interface with the Department of Labour and needs to coordinate with various departments to ensure compliance across your organization.
The Bottom Line
Designated employer status isn’t something you can ignore or handle casually. The Employment Equity Act has teeth, and non-compliance hits you in the wallet and on your B-BBEE scorecard.
The key is treating these appointments seriously from the start. Get the right people in place, give them proper authority and resources, and make sure all the paperwork is correct. Your EE Manager and committee members aren’t just compliance officers – they’re essential parts of your transformation strategy.
With the amended Employment Equity Act on the horizon, businesses that get their designated employee structure right now will be much better positioned for the additional requirements coming down the line. Start planning now, because when those new regulations kick in, you’ll want your team already up and running smoothly.
