Key Points

• Supporters of South Africa’s leading opposition party rallied round to protest the country’s new employment law
• The law aims to improve racial equality in the workforce by empowering Black workers
• Its opponents believe the law will worsen employment opportunities for other racial groups while its proponents believe the law is long overdue
• South Africa and a few other Southern African countries form the most unequal region in the world

Wednesday saw over 1,000 supporters of South Africa’s leading opposition party take to the streets of Cape Town to protest a new law mandating a race quota for increasing the employment of Black people in the workforce.

The protesters claimed this new law, which is backed by ruling party African National Congress (ANC), would discriminate against White, Indian and mixed-race (Coloured) people, thereby nullifying the purpose of the law in the first place, racial equity.

The protesters marched towards the national parliament holding South African flags and placards reading “Stop ANC race quotas”, “Jobs for all” and “ANC wants your job”

“We already have so little jobs. There are a lot of people … not working, and now they still want to marginalize us — coloured and whites and Indians,” said Astrid-Anna Abrahams, a Coloured woman who joined the protest.

Democratic Alliance (DA) Party leader John Steenhuisen added that the law would cause “incredible harm to the economy” as organisations would be forced to narrow their workforce just to keep in line with the quota.

On the contrary, the SA government insists that the new legislation, which is an amendment of the Employment Equity Act of 1998, will not lead to job losses.

Instead, it is intended to stir South Africa away from its negative reputation as the world’s most unequal country, as dubbed by the World Bank.

“There is no empirical evidence to indicate that the employment equity amendments in relation to regulation of sector EE targets might have unintended consequences on employment”, asserted Minister of Employment and Labour Thulas Nxesi in April.

Still, the DA party vehemently disagrees and projects that at least 220,000 White people, 85,000 Coloured people and 50,000 Indians will lose their jobs within the next five years in Gauteng province, the country’s industrial centre.

“No one is denying we have imbalances, but you don’t fix the evils of race-based policies by layering over more race-based policies,” stated Steenhuisen.

At the protest, Steenhuisen seized the opportunity to campaign, urging fellow protesters to vote for the DA party in the national elections come 2024.

Polls intimate that the ruling ANC, which has been in power since the end of apartheid in 1994, might see its share of votes drop below 50%.

The DA, which is widely considered a White-majority party, is the dominant party in the Western Cape province of Cape Town, SA’s legislative capital.

The Law in Detail and Why it Might Be Necessary

The Employment Equity Act (2020) bill was signed into law by President Cyril Ramaphosa on 12th April and is set to take effect on 1st September this year.

The new law mandates companies with more than 50 employees to submit equity plans reflecting the demography of their region of operation, and devise a strategy for executing those plans.

Additionally, the law enables the labour minister to set numerical targets for certain economic sectors with glaring racial inequality.

These targets will, however, not be set in an autocratic manner. Instead, the minister is required to determine them after consultation with relevant stakeholders and the Employment Equity Commission, and publish proposals for public comment thereafter.

According to Ntsoaki Mamashela, the director of employment equity in the Department of Labour, companies which fail to comply with the set targets will be taken to labour court and fined up to 2% of their annual revenue.

Mamashela says a nationwide campaign to explain the amendments to employers and their workers is in the works.

Aside from the targets and submission of equity reports, the law also requires employers to adhere to minimum wage restrictions.

Companies which follow the law will be awarded certificates of compliance. These certificates are especially important for companies with state contracts as a failure to comply is enough ground for the cancellation of such contracts.

SA’s government believes the law is crucial to achieving racial equity in the economic sector, as most companies have failed to follow through on pledges to transform the workforce by employing more qualified Black South Africans.

Black people make up about 80% of South Africa’s population, yet the government’s 2022-2023 employment equity report reveals that they only hold 16.9% of top management positions.

In contrast, White people make up less than 10% of SA’s population, but account for more than 60% of top management roles.

Additionally, nearly 50% of Black South Africans were unemployed in the first quarter of 2023, while the unemployment rate among white people was only 7.5%, according to official figures.

Proponents of the law believe the controversy surrounding the bill is largely unfounded.

“It is a rational bill and not this big monster the DA is making it to be,” said Matthew Parks, the parliamentary coordinator of Congress of South African Trade Unions (COSATU), the largest group of trade unions in Africa’s most industrialised country.

Parks encouraged the Department of Employment and Labour to “move with speed to ensure the promulgation and implementation of these long overdue provisions”.

Many, like Parks, believe policies are truly the way to go to empower SA’s most impoverished demographic, Black people.

However, the Institute of Race Relations, an SA-based research and policy think tank, opines that race-based policies have not been successful in lifting millions out of poverty. Instead, it proposes a skills-based approach to inclusive employment.

To this, one must question whether a lack of skills is the problem.

While skills acquisition programmes are welcome for those who need them, the government is trying to boost gainful employment of already skilled Black South Africans, and if the root cause of racial dynamics is not tackled, it will remain difficult for the aforementioned group to be empowered.

Southern Africa Is the World’s Most Unequal Region

A 2022 World Bank Report revealed that the Southern African Customs Union (SACU) member states of Botswana, Eswatini, Lesotho, Namibia, and South Africa, are collectively the world’s most unequal region. SA and Namibia are chief amongst them while Lesotho is the least unequal.

The World Bank found that Consumption inequality across the SACU region was more than 40% higher than the averages for both Sub-Saharan Africa and upper-middle-income countries.

Marie Francoise Marie-Nelly, the World Bank Country Director for the aforementioned countries, proposed that the playing field should be levelled from birth, by ensuring equal access to quality education, health and basic services.

At least 20% of the inequality in this region is attributed to inherited circumstances such as location, gender, age and parental background, while more than 40% can be attributed to race alone.

The latter factor follows since the SACU region has some of the most racially diverse populations in Africa. In fact, South Africa has the 5th most racially diverse population in the world, according to the Historical Index of Ethnic Fractionalisation Dataset.

In SA and Namibia, the effect of apartheid and racial discrimination means that land ownership is rare for the Black demographic and this further contributes to perpetuating high levels of income inequality.

Moreso, poor access to education precludes marginalised groups from acquiring jobs with better wages and thus, the vicious cycle continues.

The World Bank report suggested a combination of skills-based approaches, policy-based approaches and effective fiscal redistribution is the key to reducing inequality in the SACU region.

Sources: Barrons, VOA, The Africa Report, Al Jazeera, World Bank.