On 15 April 2025, the Minister of Employment and Labour (Minister) published the final sector numerical targets that reflect the five-year targets for each economic sector. The focus of the sector numerical targets continues to be top and senior management, as well as professionally qualified and skilled levels, and people with disabilities.

Sections 12 to 27 of the EEA only apply to “designated employers” and the amendments to the EEA have changed this definition to exclude employers that employ fewer than 50 employees, irrespective of their annual turnover. However, employers that still fall within the definition of “designated employer” are required to comply with various obligations in terms of the EEA, including the development of employment equity (EE) plans and submission of EE reports to the Department of Employment and Labour (DEL). The EE plan must align with sectoral numerical targets effective 15 April 2025. The process involves conducting a comprehensive workplace analysis and either formulating new plans or amending existing ones by 31 August 2025.

In turning to compliance and enforcement, a designated employer will not face penalties if they can demonstrate reasonable grounds to justify their failure to comply with any sectoral target. The 2025 Regulations to the EEA provide a list of justifiable reasons or grounds, which include insufficient recruitment or promotion opportunities, a lack of suitably qualified individuals from designated groups, the impact of a Commission for Conciliation, Mediation and Arbitration award or court order, a transfer of business, mergers or acquisitions, and the impact of economic conditions on the business.

The status of a designated employer may change post a merger, acquisition or amalgamation,  which would trigger some of the following scenarios:

• If the entity ceases to be a designated employer, the Director-General of the DEL must be informed.
• If the entity falls within the definition of a designated employer, a new EE plan must be prepared and implemented.
• If the majority of the workforce shifts, the EE plan must be amended accordingly, and the Director-General of the DEL must be notified.

A designated employer that seeks to rely on a merger and acquisition and/or any of the other listed grounds will be required to submit supporting documentation which shows that the entity’s non-compliance with a specific target is as a result of the listed ground envisaged in the Regulations. These grounds should be clearly set out in the EEA15 application form after submitting the EE report in terms of section 21 of the EEA. The entity will not incur any penalty or disadvantage if there are reasonable grounds to justify its failure to comply with a specific target.

The DEL may issue a compliance certificate in terms of section 53 of the EEA if it is satisfied that the employer has either met the sectoral targets or has demonstrated a reasonable ground for non-compliance with sectoral targets.