BEE Partner, South Africa Economy Watch

Bonus points

Two bonus points are available in employment equity. The bonus points are based on what the Codes term EAR EAP stands for “economically active population“. The Codes do not provide a clear explanation on how the bonus points are to be calculated. What follows is my interpretation on how to calculate bonus points. The two points are allocated to each indicator based on the indicator’s percentage of total points available. If the management indicator meets its EAP target, the bonus points would be 2s x 2 points. If the employee indicator reaches its EAP target, then the bonus points would be ¹₂-⁽₅². x 2 points.

EAP is a statistic that is available from Statistics SA’s website. The EAP provides a breakdown of the economically active population according to race group. Assume that the breakdown shows 90% of the economically active population is made up of African, Indian and Coloured people, while white people represent 10% of the economically active population. A business with Black employees representing greater than 90% of total employees will have exceeded its EAP target and will receive the commensurate bonus points according to the employee indicator.

Where the business has Black management that exceeds the 90% target, then it could claim the management pro-rata share of the EAP bonus points.

A business that scores full points on the indicators and then scores bonus points may carry an amount greater than 25 points forward to the total QSE scorecard.

The underlying principle of employment equity is to create a workforce profile at all occupational categories and levels that is representative of the country’s demographics. Perhaps more importantly, it ensures that there are equal employment opportunities for everyone in the economy. The inclusion of Black people will bring about diversity in the workplace.

Balancing substance with preference

The economic needs of the business must remain the primary objective. Where the decision is between a white person and a Black person of similar ability and qualification, then preference should be shown to the Black person. In many situations, the white person will have had more experience due to past opportunities. While experience is an important factor it must, within reason, play a secondary role in the BEE scenario. Another issue that should be taken into account is the attitude of the Black person towards learning. Black promotion must not be done at the expense of a business’s operational capacity.

Obviously trade-offs must be made. Black people must be shown preference to white people to achieve the targets. A business aiming to achieve the targets through growth as opposed to replacement _of white with Black is likely to make the strongest contribution to transformation. Practicalities may limit this approach, although the primary objectives must be borne in mind.

The missing element from the scorecard - working environment and culture

The working environment and culture play a big role in increasing or decreasing the fair representation of Black people in enterprises. The working environment is considered an immeasurable soft element by some while for others it is a critical element without which employment equity remains a pipe dream. The working environment and culture must accommodate the many cultures found in South Africa.

People already in the enterprise need to show sensitivity to the different cultural backgrounds of new employees. It is important for Black people to understand the culture of the enterprises they work in, but there is a reciprocal requirement for businesses to acknowledge and understand the different cultures of their employees. A tolerant atmosphere includes new employees and creates a feeling of belonging to an enterprise.

Enterprises must initiate active steps to understand the different cultural backgrounds represented in their workplace. The scorecard does not take the working environment into account, but the success of any transformation initiative depends on a working environment considerate of Black cultures as well as non-Black cultures.

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