Employment Equity Sectoral Targets and the Employment Equity Regulations, 2025 are here: what every employer needs to know

On 15 April 2025, the Minister of Employment and Labour, Nomakhosazana Meth, (“Minister”) published in the Government Gazette two critical employment equity legislative developments, effective immediately:

1. the Employment Equity Regulations, 2025, repealing the 2014 Regulations (“2025 Regulations”); and
2. the long-awaited sectoral numerical targets, published in terms of section 15A of the Employment Equity Act 1998 as amended (“EEA”), (“Sectoral Targets”).

These developments have implications for designated and non-designated employers across South Africa and represents a move towards targeted transformation.

Employment Equity Regulations, 2025

The 2025 Regulations replace the Employment Equity Regulations, 2014 and go further in aspects which we have detailed below:

1. Regulation 9: Duty to prepare and implement an Employment Equity Plan (“EE Plan”)

• All designated employers must implement a five-year EE Plan for the period 1 September 2025 to 31 August 2030.  This timeline is synchronised with the five-year sectoral numerical targets (detailed below).
• The EE Plan must incorporate the sectoral numerical targets and newly designated employers, those designated after 1 April 2025 (“Newly Designated Employers”), must prepare EE Plans for the remainder of the period, until 31 August 2030. 
• When drafting the EE Plan and setting numerical targets, the following three mandatory factors which must be accounted for are: the current workforce profile, the relevant five-year sectoral targets under section 15A of the EEA and the applicable Economically Active Population (“EAP”).  In other words, these numerical targets must be ‘benchmarked’ against the sectoral targets, failing which the employer will be non-compliant.
• Designated employers must apply the targets associated with their economic sector, in which the majority of their employees are engaged.
• Employers must set annual numerical targets for all designated groups across the four upper occupational levels, considering sector targets, the EAP, and persons with disabilities. Where a designated employer is over-represented at a particular level, employers must maintain that group’s representation in line with the EAP.

2. Regulation 10: Duty to report

Newly Designated Employers are not assessed for compliance with its Sectoral Targets in their first report after becoming a designated employer.

3. Regulation 16: EE Compliance Certificate in terms of section 53

The EE Compliance Certificate in terms of section 53 of the EEA is required for any employer who wants to conduct business with the State.  An employer must request the certificate online after submitting its annual report in terms of section 21 of the EEA.  If sectoral targets have not been achieved by a designated employer, the employer must specify which of the new seven grounds it seeks to rely upon to justify its non-compliance.  For the first time, employment equity compliance is directly tied to public procurement eligibility.

4. Withdrawal of EE Compliance Certificate

An EE Compliance Certificate is valid for. 12 months, however, it may be withdrawn at any time if it was issued based on a misrepresentation or any condition for issuing the certificate no longer exists.  A withdrawn certificate disqualifies an employer from entering into business with the State.

Sectoral Numerical Targets

The Sectoral Targets impose transformational benchmarks across 18 national economic sectors. All designated employers are required to align their EE Plans with the Sectoral Targets and demonstrate progress towards achieving them over five-years, ending 31 August 2030.

These targets apply across four occupational levels namely Top Management, Senior Management, Professionally Qualified and Middle Management, Skilled Technical and introduces a target for employees with disabilities of 3% for the entire workforce.

The numerical targets are tailored to reflect national economic sector-specific workforce demographics and transformation. These sectors include: Accommodation and Food Service Activities, Administrative and Support Activities, Agriculture, Forestry & Fishing, Arts, Entertainment and Recreation, Construction, Education, Electricity, Gas, Steam and Air Conditioning Supply, Financial and Insurance Activities, Human Health and Social Work Activities, Information and Communication, Manufacturing, Mining and Quarrying, Professional, Scientific and Technical Activities, Public Administration and Defence; Compulsory Social Security, Real Estate Activities, Transportation and Storage, Water Supply, Sewage, Waste Management and Remediation Activities and Wholesale and Retail Trade; Repair of Motor Vehicles and Motorcycles. 

Conclusion

The sectoral targets are central to compliance with the EEA. They form the benchmark against which compliance is measured, EE Plans are evaluated, and on which EE Compliance Certificates are issued.  Employers are encouraged to evaluate their workforce against the new 2025 Regulations and Sectoral Targets and to begin taking steps towards compliance with the EEA ahead of the 1 September 2025 deadline, for new EE Plans to be put in place.

*In terms of the EEA, a designated employer is defined as any person who employs 50 or more employees, a municipality (as per Chapter 7 of the Constitution), an organ of state (as per section 239 of the Constitution, except for the National Defence Force, the National Intelligence Agency and the South African Secret Service) and an employer who is bound by a collective agreement as per section 23 or 31 of the Labour Relations Act 66 of 1995 – which appoints such an employer as a designated employer, as provided for in the collective agreement.