The Constitutional Court dismisses the urgent application against South Africa's new employment equity quotas, but Sakeliga said it will take the fight under review.
Image: Leon Lestrade/ Independent Newspapers
South Africa’s National Employers’ Association of South Africa (Neasa) and business group Sakeliga lost their Constitutional Court fight to halt the government’s new employment equity (EE) quotas, but they vowed to continue the fight.
The Constitutional Court declined Sakeliga and Neasa's application for leave to appeal in their urgent application for an interdict against the Employment Equity quotas enacted in 2025. But they will now pursue the matter through a review on a non-urgent basis to have several sections of the Employment Equity Act declared unconstitutional and set aside.
Minister of Employment and Labour, Nomakhosazana Meth, meanwhile, welcomed the Constitutional Court dismissal of the urgent application and said that, absent an interdict, the department is forging ahead with the implementation of the EE Regulations and the 5-year sector numerical EE targets.
The Employment Equity Amendment Act and its accompanying two sets of Employment Equity Regulations, including the 5-year sector numerical EE targets for the 18 economic sectors, came into effect last year for designated employers, such as those that employ 50 or more employees.
Meth said it is important to note that the numerical goals are set by the designated employers, and companies must therefore submit their annual EE reports against their own set annual EE targets in their EE plans.
After the commencement of the EE Amendment Act and its EE Regulations, several legal challenges were instituted against the department and the Commission for Employment Equity (CEE). These cases primarily challenged the constitutional validity, lawfulness, consultation process, and the implementation of the amended EE legislative framework and the 5-year sectoral numerical EE targets.
Neasa and Sakeliga were amongst the first to file an urgent application with the Gauteng High Court, where they tried to suspend the implementation of the EE targets. The High Court dismissed Part A of the application and held that an interdict was not appropriate where the minister had already exercised statutory powers.
The court declined to suspend what it regarded as a lawful exercise of statutory authority, emphasising the separation of powers. The court further held that the consultation process preceding the publication of the sectoral numerical EE targets was lawful and that employers retain flexibility to justify deviations for non-compliance in terms of the Employment Equity Act.
The applicants then approached the Supreme Court of Appeal, which also turned down leave to appeal. They subsequently approached the Constitutional Court on an urgent basis for leave to appeal, to be followed by a review application.
The minister said her department will also oppose the pending review application. The department explained that the key objectives and implications of the EE Amendment Act include empowering the minister to regulate sector-specific EE numerical targets. This is to ensure the equitable representation of suitably qualified people from the designated groups (Africans, Coloureds, and Indians, women of all race groups, as well as people with disabilities irrespective of their race and gender).
It also calls for an EE Compliance Certificate as a prerequisite for access to state contracts and doing business with any organ of state. All the designated employers are legally obligated to fully comply with the Employment Equity amendments by aligning their annual EE targets in the EE Plans with the 5-year sector numerical EE targets, the minister said.
In response to the Constitutional Court ruling against them, Sakeliga said that the Constitutional Court has failed to acknowledge the tremendous compliance costs, business planning risks, and investment deterrence caused by the quotas.
While the quotas prescribe strict limitations on employment by race and sex for organisations with 50 or more employees, it also limits white male employment to as little as 4% in many cases and dictates absurd and unrealistic gender hiring prescriptions in many industries, Sakeliga said.
zelda.venter@inl.co.za