New Employment Equity Rules Take Effect: What South African Employers Must Know (Part One)

South African employment law has taken a significant step with the introduction of the updated Employment Equity Regulations, which came into effect on 15 April 2025. These new regulations replace the 2014 version and form part of the Government’s stronger push for workplace transformation. They introduce stricter compliance rules, sector-specific targets, and more stringent enforcement measures for employers. 

Whether you’re an HR professional, business owner, or compliance officer, staying informed about these changes is crucial to ensuring your organisation remains compliant and avoids potential penalties. 

Key areas covered in the new regulations are equal pay for work of equal value and pay disparities. All employers must ensure equal remuneration for work of equal value, free of unfair discrimination based on race, gender, or disability. Factors to assess “work of equal value” include responsibility, skills, effort and working conditions. An employer may only justify pay disparities on grounds such as performance, seniority, scarcity of skills and market value of the role. 

A designated employer is one which employs 50 or more workers, regardless of turnover. Designated employers must collect workforce data using the updated EEA1 form; identify barriers to equity and record this via EEA12; develop a five-year Employment Equity Plan (EEA13), applicable from 1 September 2025 to 31 August 2030, including annual targets aligned to sectoral benchmarks and EAP (Economically Active Population) statistics; and submit annual reports (EEA2 and EEA4), between 1 September and the first working day of October (manual) or 1 September and 15 January (online). 

Sector-specific numerical targets, outlined in EEA17 forms, apply to the top four occupational levels, being top management, senior management, professionally qualified/middle management and skilled technical staff. Employers must set self-determined targets for lower-level positions (semi-skilled and unskilled), guided by national or regional EAP statistics. 

The Department of Employment and Labour has significantly bolstered its enforcement capabilities. Labour inspectors are authorised to issue compliance orders (EEA6) where breaches are detected. The Director-General may administer formal reviews (EEA7) of employer practices. Administrative fines can be imposed, up to R1.5 million or 2% of annual turnover, depending on the nature and frequency of non-compliance. Employment Equity Compliance Certificates may be revoked where ongoing breaches are found. 

Further, the Department of Employment and Labour has deployed 50 newly appointed inspectors to monitor and enforce compliance with the Employment Equity Amendment Act (EEAA), which came into effect earlier this year. The inspectors will focus on private companies employing 50 or more people, ensuring that Employment Equity Plans are developed and implemented in line with the new requirements. These plans must reflect the demographic composition of the economically active population, with particular emphasis on fair representation in management roles. 

Next month, we will discuss the importance of compliance certificates, public reporting obligations, justifiable grounds for non-compliance, and implementation timelines and penalties. 

Ensure your business meets Employment Equity compliance with expert guidance from McCarthy Attorneys Inc. Contact us today to schedule a consultation and alleviate the stress of compliance.