EE Compliance Certificate: Department of Labour

EE Compliance Certificate: Department of Labour

• 03 August 2023
• Accounting
• South African Accounting Academy

Designated employers will have to meet a number of criteria to be issued with an annual employment equity (EE) Compliance Certificate to enable them to do business with the State.

According to Department of Employment and Labour Deputy Director of EE, the requirement to do business with any organ of state was not new.

In terms of the amendments to EE Act that were signed into law in April by the President, the criteria for designated employers (those that employ 50 or more employees) will need to:

• Submit Annual EE Report

• Comply with own Annual EE Targets towards the 5-year Sector EE Target;

• Comply with the National Minimum Wage (NMW)/ exemption granted not to pay NMW (previous 12 months);

• No CCMA Unfair Discrimination Award against employers (previous 12 months).

Click here to access the Media Statement:

https://www.labour.gov.za/ee-compliance-certificate-to-be-a-prerequisite-for-access-to-state-contracts-%E2%80%93-department-of-employment-and-labour

Relevance to Auditors, Independent Reviewers & Accountants:

• The Employment Equity Act is yet another piece of legislation that your clients must comply with, and which you must assess compliance with.  If they don’t comply with the relevant laws and regulations, you have certain reporting obligations in terms of NOCLAR (NOn-Compliance with Laws And Regulations) – this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.

• As an auditor, independent reviewer and accountant, you should be aware of amendments to Employment Equity Act, so that you can assess the impact thereof on your clients and when the changes will take effect.

• If you meet the definition as a “designated employer”, you also need to comply with the Employment Equity Act in your workplace, and especially when submitting state contracts.

Relevance to Your Clients:

• A designated employer (whether a company or close corporation) has a duty to comply with the Employment Equity Act, otherwise they could be held liable.

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