The Employment Equity Amendment Act of 2013, which came into effect on 1 August 2014 introduces a new clause requiring that employees who do the same/similar work, or work of equal value should not receive any difference in terms and conditions of employment based on unfair discrimination. In this blog, and in blogs to come, I will be discussing the concept of equal treatment for work of equal value from the perspective of a potential compliance risk, but also as a business opportunity.
Equal treatment for work of equal value, a key amendment to the Employment Equity Act
As before, the Act has 2 primary parts:
- Prohibition of Unfair Discrimination, which applies to all employers
- Affirmative Action, which applies to Designated Employers (≥50 employees, or turnover exceeds threshold set for their industry)
I’ll focus on the impact of a new clause related to work of equal value introduced under the 1st part: Prohibition of Unfair Discrimination. I’ll briefly set the scene, then look at the practical implications for employers, and end up with a thought on rewarding performance.
Setting the Scene
1. The general prohibition against unfair discrimination remains unchanged. No employer may discriminate against anyone in any employment policy or practice:
- Based on any of the 19 grounds listed (race, gender, HIV status etc.) “or any other arbitrary ground” (new amendment);
- Except to implement Affirmative Action or based on the inherent requirements of the job.
2. The Amendment then adds the new clause we’re considering:
- “A difference in terms and conditions of employment between employees of the same employer performing the same or substantially the same work or work of equal value that is directly or indirectly based on any … of the grounds listed in subsection (1), is unfair discrimination.”
3. Jurisdiction of the CCMA: Such disputes used to be adjudicated by the Labour Court (unless all parties agreed to arbitration at CCMA). The Amendment now allows an employee to refer it to CCMA for arbitration (a cheaper, more informal and accessible option) without agreement from the employer if:
- it relates to sexual harassment; or
- the employee earns less than the earnings threshold prescribed under section 6(3) of the BCEA, which is currently at R205433 per year; or
- all parties agree.
(There is a right to appeal to the Labour Court against an award of the CCMA).
4. Burden of Proof: The amendments place the onus more fully on the employer’s shoulders: if there is an allegation of unfair discrimination on any of the 19 grounds listed, the employer must now prove:
- That such discrimination didn’t actually take place as alleged; or
- Is rational, not unfair or justifiable.
(If it is an allegation related to “any other arbitrary ground”, then the onus is on the employee to prove it).
Practical Implications for Employers
The amendments are intended to work together to strengthen the hand of employees (especially lower earning employees) to protect themselves against unfair discrimination:
- Telling them clearly that they’re not supposed to be earning less than colleagues who do the same/similar work or work of equal value based on any form of unfair discrimination.
- making allegations easier to pursue by giving access to the CCMA, shifting the onus to the employer to refute the allegation.
Thus, if an employee alleges that he does substantially the same work or work of equal value as a colleague, but receives worse terms and conditions of employment, he can refer it to CCMA for conciliation, failing which arbitration. The Employer would then have to prove on a balance of probabilities that:
- such discrimination didn’t actually take place as alleged; or
- Is rational, not unfair or justifiable.
It is unlikely that an argument related to performance would hold any weight unless the employer could prove this objectively (through past performance appraisals, clear work records etc.).
A Thought on Rewarding Performance
So, should we aim to equalise pay and other terms and conditions of employment?
Goodness no! Differences in terms and conditions of employment are not only inevitable, but essential in an age where there is a war on for key talent. Failure to recognise and reward for performance will cause talent retention problems (the good guys will leave to receive the rewards they deserve, the poor performers will stick around with a sense of entitlement).
Although we could complain that this new clause may open the gates for frivolous and unfounded claims and undermine our efforts at rewarding performance, our energies are better spent ensuring that we are actually rewarding for objectively provable superior performance. In other words, we’re being forced to be more scientific in our approach to performance management. A worthy investment, particularly when research shows that performance management is the highest ROI human resource initiative we could undertake.
In future blogs I will build on the above and further examine the concept of the test for unfair discrimination in relation to work of equal value (the compliance side of things) as well as performance management (the business case for work of equal value).
By Shaun Cox (Key link) is a Strategic Human Resources Consultant who specialises in strategic solutions for SMEs.
Photo Credit: Actu Worksite