South Africa  is suffering from a chronic illness. Why is she so sick and what are the root causes of her ailments? The government-appointed National Planning Commission (NPC) seeks to provide some answers in its recently released Diagnostic Overview report by taking "a broad, cross-cutting, independent and critical view of South Africa ."

Cyril Ramaphosa, NPC Deputy Chairperson

Deputy Chairperson of the Commission, Cyril Ramaphosa, and head of the NPC Secretariat, Kuben Naidoo, presented their findings at a forum  held at the Gordon Institute of Business Science last week. The discussion provided a sobering examination of some of the country's structural defects, but was also defined by a spirit of optimism and frankness.

As stated in the NPC report (available online), the mandate of the Commission is "to help define the South Africa  we seek to achieve in 20 years time and to map out a path to achieve those objectives. The commission is expected to put forward solid research , sound evidence and clear recommendations for government." [p.1]

Ramaphosa reiterated these objectives by highlighting the NPC's broad consultative nature and its attempt to achieve consensus on where the country is going. "We are consulting at a fairly deep level," he said, "through various forms and structures of society, from business, to NGOs, trade unions, religious organisations, you name them."

Ramaphosa spoke of the need for a guiding vision similar to the one that propelled the constitutional negotiations in the early 1990s, of which he was a principal player. "We need a vision statement for SA  that when you read it, you can't help getting goosebumps," he said.

Roelf Meyer conducted the debate

According to the report, South Africa faces an overwhelming array of problems. These include low employment, poor education and a health care system struggling to cope with "a massive disease burden." The difficulties experienced today are the result of an enduring apartheid legacy coupled with poor policy planning and shoddy implementation post-1994.

The SA  economy is also too resource-intensive claims the NPC, making it susceptible to capricious global commodity cycles [p.17]. "South Africa is a typical colonial economy," said Ramaphosa, "It is far too extractive in nature." Diversification is sorely needed to make the SA  economy more agile, he argued.

Another focus of the report was on urban geography where there are "spatial challenges that continue to marginalise the poor" and infrastructure that is inadequate [p.19]. For example, poor South Africans are typically located on the margins of country's major cities and are forced to rely on expensive, unsafe and unreliable forms of transport in order to make a living.

These and other factors entrench the existing status quo of low growth and an unequal distribution of resources and wealth. In fact, reducing inequality is one of the core objectives of the National Planning Commission [see p.26].

Kuben Naidoo, head of the NPC Secretariat

Kuben Naidoo noted that one of the principal challenges facing SA was policy instability in the public sector [p.22]. With every new new minister comes changes in policy, he said, making it difficult to sustain long-term public policy programmes. Naidoo cited the Eastern Cape as an example, where in the 17 years since 1994 there have been a total of 14 MECs for Education. This turnover is far too high, he said.

Add to this the widespread presence of corruption and you have what amounts to a cumulative assault on the legitimacy of the state and its capacity to deliver services. Corruption, explains the NPC, "is particularly damaging to good relations between citizens and the state. It undermines confidence in the democratic system by enabling the better off to exert undue influence over the policy process or obtain preferential access to services." [p.25].

Responding to criticism that the NPC would ultimately be hampered by political constraints, Ramaphosa, who is also a member of the ANC National Executive, was as unequivocal as he could be. "We [in the NPC] will deal more with policy than with politics." he said. "We have to go beyond party interests. We are behoven to SA Inc, and not the interests of the ANC."

Another critical view expressed on the night was that the public consultative process had not gone far or wide enough. One audience member pointed out that the survey  had only been conducted online, and in English, vastly narrowing the number of citizens who could participate. Ramaphosa's response was to commit to extending this process further - and in multiple tongues.

Returning to the medical metaphor, Ramaphosa took a cautiously optimistic view: "This patient walks, it is still alive," he said, "This patient is not terminally ill - it can be cured - we just need to find the right remedies."

The patient will find out what those remedies will be when the NPC presents its final plan to cabinet in November 2011. Whether the executive will be either willing or able to implement this plan remains to be seen - and therein lies the Commission's greatest challenge.

Photos: David Ansara

The recently proposed amendments to the Employment Equity Act (‘EEA’) created much discussion and concern. The concern arose from both the substance of some of the proposals and the poor manner in which they were drafted. For now it would appear that the proposed changes (as well as proposed changes to the LRA and the BCEA) will not be promulgated in their current form. We are likely to see, at some point in the not too distant future, better considered and drafted proposals for change. One can expect that greater emphasis would be placed on employers’ obligations regarding affirmative action in terms of Chapter 3 of the EEA. The main focus of this article is to give a brief overview of what the courts have said to date about affirmative action, its limits and its implementation. But first, it might be useful to provide some context.

Statistics from last year’s Employment Equity report by the Employment Equity Commission, established under the EEA, suggest that while good progress has been made in terms of representation of designated groups at most levels in the private sector, there has been slow progress at the more senior levels. While some (including people in the Department of Labour) have blamed business for being ‘anti-transformation’ or at least tardy in their commitment to affirmative action, there is reason to believe that our skills shortage at those senior levels is real and could provide at least part of the answer to the lack of transformation at the top of the organisational pyramid. A report in Sake24 dated 11 May 2011, quoting statistics from Adcorp’s Recruitment Index, states that roughly 829 800 vacancies existed in SA  for ‘highly skilled’ employees. This includes positions in management , accounting, medicine, engineering, law, specialised technicians and artisans. This contrasts with unemployment figures of roughly 967 000 and 247 400 among entry level job  seekers and domestic workers, respectively.

Since 2000, the shortage of highly skilled employees has resulted in an inflation adjusted increase of 286.4% in the salaries of people in that category – scarce skills simply became more expensive. Meanwhile, the National Skills Fund is reportedly sitting on roughly R3.5 billion for skills development which it has yet to distribute.

What all of this means is that employers in the private sector will have to contend with two opposing pressures, one coming from organised labour and government for quicker transformation and the other from the labour market. This is likely to result not only in greater and more frequent demands from trade unions in particular, but probably also an increase in the Department of Labour’s vigilance and in litigation around affirmative action issues.

So what have the courts said so far about affirmative action? The following is a summary of the principles the courts have developed in the numerous cases over the years dealing with affirmative action:

• Those acting in a higher position do not have a right to be promoted to that position, but must be treated fairly;
• Where internal applicants are involved, the decision not to appoint them must comply with internal procedures and be based on rational grounds, e.g. suitability, skills or promotion of representivity;
• Internal applicants should be able to challenge their non-appointment to a higher position on the basis of unfair discrimination and unfair labour practice;
• The absence of a plan is not fatal to an employer’s reliance on affirmative action in justifying appointment or promotion to a position, but may create evidentiary problems;
• When applying affirmative action, employers should not only focus on past disadvantage, but also on the retention of skill and the efficient operation of the organisation or, in the public sector, service delivery and good administration;
• The mere fact that a white person is appointed to a position and that the unsuccessful candidate happens to belong to a different race does not necessarily constitute race discrimination under the EEA;
• There is no right to affirmative action in our law;
• Because there is no right to affirmative action, a designated person cannot demand, as a right, to be retained in a retrenchment exercise in favour of persons from non-designated groups who have skills better suited to available positions;
• Mechanical compliance with the prescribed processes of the EEA is not genuine compliance with the letter and spirit of the EEA;
• Compliance is not an end in itself – employers must systematically develop the workforce out of a life of disadvantage;
• There are special requirements to be met before one can succeed in a claim for discrimination based on a ground not listed in the EEA;
• Provided the requirement is genuine, there is nothing wrong with an employer requiring proven managerial experience to fill senior posts, even if that excludes members of the designated groups;
• Where an affirmative action plan contains a ‘sunset clause’, the exclusion of non-designated candidates in favour of less qualified persons from the designated groups may constitute unfair discrimination if equity targets have been achieved in a particular job  category;

· The extent to which the implementation of an employment equity plan could discriminate or adversely affect individuals is limited by law;

· In implementing employment equity, the affected employee’s right to equal treatment before the law and to dignity must be recognised;

· Where a suitable person from an under-represented group cannot be found, the promotion of someone from a different group should not be denied without a clear and satisfactory explanation;

· There has to be a rational connection between the provisions of the employment equity plan and the measures adopted to implement its provisions. In the case of the State, due regard must be given to the efficient operation of the public service;

• It has not yet been decided whether an employer is entitled, rather than obliged, to take race or gender into account when selecting the employees to be dismissed in a retrenchment exercise.

In summary, the courts have been trying to find a balance between the competing needs for greater representivity of designated groups at all levels in the workplace on the one hand, and the right to equality of individuals from the excluded groups (minorities among the designated categories or non-designated people, i.e. able-bodied white males).

This article is by Prof. Barney Jordaan of Maserumule Employment Consultancy for www.labourwise.co.za

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