MAIN IMAGE: Jan le Roux – CE of Rebosa
Editor
Last year, the real estate industry faced a protracted and costly struggle regarding BEE certificates. This year, bigger agencies will have to comply with the new employment regulations.
What happened?
In April, the Minister of Employment and Labour repealed the Employment Equity Regulations of 2014 and, under Section 55(1) of the Employment Equity Act, 1998, promulgated the Employment Equity Regulations, 2025.
The goal with the 2025 Regulations is to introduce stricter compliance obligations and enforcement mechanisms. The fox in the hen house is the new five-year numerical targets by sector.
Section 15A specifically empowers Minister of Employment and Labour, Nomakhosazana Meth, to set binding targets for designated employers and mandates the “equitable representation of suitably qualified individuals from designated groups across all occupational levels”.
The government maintains that the new targets aim to ensure transformation across all sectors, but many (like the Democratic Alliance) argue that they are ‘unconstitutional and violate the principle of equality before the law’.
Representing the DA, advocate Ismail Jamie SC argued that the previous version of the Act achieved a balance in terms of fairness and transformation, whereas the introduction of demographic targets amounts to “unfair discrimination, particularly against coloured and Indian communities in provinces such as the Western Cape and KwaZulu-Natal, where these groups comprise a significant share of the population”.
Only agencies with 50 or more employees are affected
Previously, companies were allowed to set their own equity targets within the framework of the EE Act. However, with the latest amendments, the Department of Employment and Labour has introduced official, sector-specific targets that now apply to designated employers (those with 50+ employees – not just agents, all staff).
For the real estate sector, this means transitioning from self-defined plans to aligning with government-set targets aimed at ensuring more equitable representation of South Africa’s demographics, particularly in management and senior positions. This shift is intended to accelerate transformation and promote diversity in the workplace.
“This is problematic for the real estate industry as the industry is commission-based as far as the estate agents are concerned, and most of the employees in any estate agency are estate agents. Management levels hardly exist – most agencies have very flat structures. Because there are no fixed salaries, it’s not a career suitable for most, and one could almost argue that successful estate agents select the agencies they want to work for. More than 60% of the industry is constituted by small companies employing very few,” says Jan le Roux, CE of Rebosa.
How can affected agencies comply?
The 2025 Regulations and the sectoral targets significantly change the Employment Equity landscape with immediate effect. All designated employers and entities seeking to conduct business with any organ of state should pay particular attention to these new developments.
Rebosa explains that qualifying agencies (those with 50 or more employees) now need to do the following:
1. Designated employers must take account of their current workforce profile and compare that to the relevant sector numerical target as well as the applicable Economically Active Population (“EAP”) data for each occupational level.
2. This should then be used to set annual numerical targets by the employer for their workforce for each year of their 5-year plan.
3. Designated employers should first strive to meet the sector numerical targets applicable to them, or where these have already been achieved, then aim to achieve the applicable EAP.
4. Designated employers are warned not to set targets for groups whose representation already meets or exceeds the applicable EAP in a particular occupational level. However, employers may also not regress if they have met the set numerical target of a particular group at an occupational level.
5. Designated employers are required to set annual numerical targets for the upper occupational levels for which sector numerical targets have been provided. These levels include Top Management, Senior Management, Professionally Qualified & Middle Management, and Skilled Technical.
6. Designated employers are cautioned to continue to also set annual numerical goals for the lower occupational levels of Semi-Skilled and Unskilled employees, despite no sector numerical targets having been set for these levels.
What are the risks of non-compliance?
According to SERR Synergy, the Act acknowledges that there may be reasonable grounds for employers failing to achieve the EEA targets, depending on the circumstances of each employer. The Act requires employers to comply with the processes prescribed by the Act as peremptory provisions. The Act assumes that if these processes are duly followed, employers should reasonably be able to progress towards achieving targets. However, the Act does not per se propose sanctions for failure as it is possible to miss targets even if the prescribed processes are fully implemented”.
“Rebosa supports transformation and continues to encourage its members to adhere to the ideal. All reasonable steps should be taken to promote transformation; agents are advised to adhere to the requirements now published and to achieve whatever is possible so as to avoid penalties. Principals are advised to consult the Rebosa portal for guidance on this”, says le Roux.
What now?
The DA went to the Pretoria High Court last week to challenge the Act, and a judgment will be delivered at a later date.
