How Equal Treatment Legislation Impacts Staff Outsourcing
South Africa is one of the most culturally, racially, and economically diverse nations on the planet, with an economic landscape that reflects this diversity in every industry, company and working individual.
In 1998, legislators passed the Employment Equity Act (EEA), No. 55, to guarantee that everyone in South Africa has equal opportunity and fair treatment at work. The act protects employees and their rights from discrimination by the employer and ensures equal pay for equal work regardless of their demographics, such as age, gender, and race.
In 1995 a law was passed that strengthens equal treatment legislation in South Africa. This law is called the Labour Relations (LRA) Act 66, purposed to regulate the temporary employment industry and the relationship between outsourcing agencies like MASA, their employees and the clients outsourcing to meet their needs.
The Basic Conditions of Employment Act (BCEA) 75 of 1997 also applies to temporary employment services, focusing on securing temporary and permanent employees’ accurate documentation and remuneration.
Essentially, if you are looking to outsource your staff to a temporary or permanent employment specialist, it is essential to understand how equal treatment legislation affects your decision to outsource.
Knowing the rights of temporary employees and the roles of your outsourcing partner and your company will ensure that you maximise the potential of your workforce while maintaining fair and equal employment practices.
This article examines the Employment Equity Act alongside the Labour Relations Act and the supporting Basic Conditions of Employment Act, and discusses the impact of equal treatment legislation on your staff outsourcing solution.
If you are seeking more urgent counsel in regards to staff outsourcing, you can contact MASA to speak to South Africa’s leading experts in the employment space.
The Employment Equity Act
Employment Equity Act (EEA), No. 55 is the law that promotes equity in the workplace, ensures that all employees receive equal opportunities and that employees are treated fairly by their employers.
The law also prohibits employers from discriminating against their workers, either directly or indirectly, via employment policy or practice based on race, religion, gender non-conformity, nationality origin or political opinion.
The purpose of the EEA is to achieve equity in the workplace by:
- Developing fair treatment and equal opportunity, as well as combating all forms of unlawful prejudice.
- Enforcing affirmative action policies to compensate for disadvantages in employment that certain categories of people (such as black individuals, women, or persons with disabilities) have suffered so that they are equally represented in all occupational sectors and levels throughout the workforce.
- The law applies to all workers and employers, except for the South African National Defence Force, National Intelligence Agency, and South African Secret Services.
What is your responsibility as the employer to ensure that the EEA is being implemented?
A designated employer must prepare and implement a plan to achieve employment equity, which must:
- have objectives for each year of the plan,
- include affirmative action measures,
- have numerical goals for achieving equitable representation,
- have a timetable for each year,
- have internal monitoring and evaluation procedures, including internal dispute resolution mechanisms, and
- identify persons, including senior managers, to monitor and implement the plan.
Does the EEA apply to you as a staff outsourcing client?
To understand whether the Employment Equity Act applies to you as an outsourcing client, we must first understand what a “designated employer” is. To do this, let’s move on to the Labour Relations Act.
The Labour Relations Act
The Labour Relations Act (LRA) Act 66 of 1995 outlines who exactly is the employer of a temporary employee. To put it simply, the outsourcing agency, or the one providing the temporary employment services, is considered the designated employer as long:
- the work is not longer than three months
- the employee earns under the minimum threshold of R211,596.30 per annum
If the employee earns above this threshold, or the work they are hired for continues after three months or for an indefinite period, the client is deemed the designated employee.
These factors ensure that temporary employees are hired for work that is indeed temporary. It also ensures that if temp hires go beyond the pay grade and duration period of their temporary position, they are adequately compensated and treated equally like permanent employees.
So, back to our initial question:
Does the EEA apply to you as a staff outsourcing client?
Simple answer: Yes, it does.
Where an outsourcing agency commits an act of unfair discrimination on the express or implied instructions of a client, both the agency and the client are jointly and severally liable.
The employee may institute proceedings against the outsourcing agency, the client, or both, where there is joint and several liability or the employee (earning below the threshold) is deemed a designated employee of the client.
Both the outsourcing agency and you as the client must ensure that the fundamental rights of the temporary employee are upheld. Clients are expected to hold outsourcing agencies to a high standard when managing temporary employees, which is why it is essential to partner with a trusted outsourced service provider.
Reasons to partner with a trusted outsourcing agency
Staff outsourcing is an empowering way for your company to gain qualified employees on a temporary or permanent basis according to your needs. When outsourcing temporary employment specifically, you have fewer obligations to uphold as a client, such as equal access to benefits.
However, equal treatment legislation still applies to you as a client through joint and several liabilities, so it is important that you partner with the right agency that knows how best to support your business needs while ensuring equal employment practices across all temporary hires.
There are many vital points to check before you trust a staff outsourcing agency:
- They have extensive experience in staff sourcing and employment
- They have a proven track record of hiring quality temporary staff that meet equal treatment legislation requirements and fit your culture
- They will be accountable to provide you with the best service delivery possible
- They will handle the documentation of the employee, such as written particulars
- They have extensive risk management protocols in place, including liability cover
A leading outsourcing agency like MASA goes beyond the status quo to uphold equal treatment legislation and protect clients from unnecessary legal issues.
As a client, you can rest assured that all employee terms of engagement are aligned with the latest changes in legislation and that you have the expertise of our specialists on your side for any legal concerns that you may have.
We indemnify and hold clients harmless against claims and costs of any nature arising out of a contravention by the Agency of the provisions contained in:
- section 198(4) of the LRA
- section 82 of the BCE
- section 52 of the EEA
At MASA, we are also specialists in human resources and industrial relations administration. We handle everything from candidate vetting, site administration and payslip delivery to payroll and accounts, CCMA attendance, and dismissals.
Are you getting equal outsourcing services to this?
Ultimately, equal treatment legislation is in place to protect both you as the client and your temporary employees. It is up to outsourcing agencies such as MASA to help you understand equal treatment legislation and how it impacts staff outsourcing sourcing clients like yourself.
By partnering with an expert outsourcing agency, you can effectively manage equal treatment practices across your current and future temporary employees and ensure equal treatment compliance in your staff outsourcing journey.
Contact MASA to leverage the highest level of staff outsourcing services and bring the specialised skills, knowledge and expertise that will give your company the competitive advantage.
Knowledge is power, and there is always something new you can learn to stay ahead in your industry. Check out our blog for more value-packed reads, or talk to us directly for consultation with trusted experts in the employment space.