Employment Equity: the first year you report against your targets

The amended Employment Equity Act came into force on 1 January 2025. It changed who has to comply and what they have to show. The reporting window that opened on 1 September 2026 is widely described as the first in which designated employers are assessed against the annual targets in their 2025 to 2030 plans. If you are a designated employer, your EEA2 this cycle carries more weight than last year's.

Who is a designated employer now

An employer with 50 or more employees, or one designated in another way under the Act, such as a municipality or an organ of state. The old turnover test is gone. A business with 48 employees and a large turnover is no longer designated; a business with 52 employees and a small turnover now is.

What the sector targets are

On 15 April 2025 the Minister gazetted five-year numerical targets for 18 economic sectors (GN 6124). They cover the four upper occupational levels: top management, senior management, professionally qualified, and skilled technical. They are split by population group and gender, with a separate disability target. Your annual targets in the EE plan must take account of your workforce profile, your sector's five-year targets and the economically active population you elected.

Reasonable grounds

Missing a target is not in itself an offence. The regulations list reasonable grounds an employer may rely on: too few recruitment or promotion opportunities, too few suitably qualified people from designated groups, a CCMA award or court order, a transfer of business, a merger or acquisition, and economic conditions. With reasonable grounds, the notice says, there are no penalties or any form of disadvantage. The practical lesson is that reasonable grounds have to be shown, which means records: vacancies advertised, shortlists, appointments, the reasons a role was not filled.

The section 53 certificate

If you contract with the state, you need a section 53 Employment Equity compliance certificate, requested on EE Online with the EEA15 form. A designated employer must have met its targets or shown reasonable grounds, and must have no unfair discrimination finding or minimum wage award against it in the past 12 months. Employers with fewer than 50 employees use the declaration route. The certificate is valid for 12 months.

The court challenges

Several challenges to the sector targets are still before the courts. The urgent application by NEASA and Sakeliga to suspend them failed in the High Court, the Supreme Court of Appeal and, on 22 May 2026, the Constitutional Court. Reviews by NEASA and Sakeliga, Solidarity and BUSA are pending. As at November 2026 the targets are in force and must be applied, while those reviews continue.

Penalties

The maximum fine for a first contravention is the greater of R1.5 million or 2% of turnover, rising for repeat contraventions. Fines are not automatic: an inspector's undertaking, a compliance order and a Director-General review come first.

Sources

• GN 6124, sectoral numerical targets, 15 April 2025.
• GN 6125, Employment Equity Regulations 2025.
• Minister of Employment and Labour, statement of 28 May 2026.
• EE Online, Department of Employment and Labour.

General guidance, not legal advice.