On the 1st of June 2015. in terms of Section 54(1) of the Employment Equity Act (EEA), 1998 (Act No 55 of 1998 as amended) the Minister of Labour issued the Code of Good Practice (Code) on Equal Pay/Remuneration for Work of Equal Value. The Code promotes the elimination of unfair discrimination in respect of pay/remuneration by applying the principle of equal pay/remuneration for work of equal value.
The objectives of the Code are (1) to provide practical guidance to employers and employees on how to apply the principle of equal pay/remuneration for work of equal value in their workplaces, (2) to promote the implementation of pay/remuneration equity in the workplace by employers, including the State, employees and trade unions through human resources policies, practices and job evaluation processes and (3) to seek putting into practice equal pay through human resources and pay/remuneration policies, practices, and proper consultation procedures as well as the management thereof within a sound governance framework that will drive the principle of equal pay in a fair, consistent and “free from unfair discrimination” manner.
The Code aligns its principles with sound remuneration practice through the following focus areas:
- Alignment of remuneration policy with the principles of equal pay. (Section 3, Page 9)
- Eliminating unfair discrimination by taking steps to eliminate differences in terms and conditions of employment.(Section 4, Page 10)
- The 4 criteria that should form part of the Job Evaluation System used in your organisation. (Sub section 5.4, Page 11)
- The process that should be followed when evaluating jobs for the purposes of equal pay for work of equal value. (Section 8, Page 14)
- Gender discrimination – establishing the value of male- and female -dominated jobs in order to be able to ascertain whether particular jobs have been undervalued in the past. (Section 6, Page 12)
- The factors justifying differentiation in pay/remuneration. (Section 7, Page 13)
The Code provides 3 key issues (Sub section 4.4, page 10) which require scrutiny when examining whether the employer is complying with its obligation to apply equal pay in the workplace, as depicted below –
The schematic below highlights the main areas where the employer will be obligated to ensure compliance by conducting internal reviews, analysis, reporting and corrective action.
Remuneration Consultants South Africa have extensive experience in reviewing Employment Contracts and Remuneration policies, procedures and practices to assess the level of compliance to the principles of equal pay. Our team of reward specialist professionals, including lawyers, will assist your company with the following:
- Design a “Pay Diagnostic and Assessment Tool” to proactively measure and analyse your pay/remuneration internal equity and highlight possible risks of non-compliance.
- Job Evaluation – We have extensive experience in Job Evaluation having used numerous Job Evaluation Systems, provided training on conducting Job Evaluation and attended Job Evaluation Committees as external advisors to companies.
- Review your Remuneration Policy and Employment Contracts to ensure alignment to the principle of equal pay and ensuring good corporate governance thereon.
If you have any questions regarding the Code or require our assistance regarding Equal Pay, please do not hesitate to contact us.