NONHLANHLA MTSHALI: Discrimination and legal developments in SA labour and employment law

This year has once again placed xenophobia under the spotlight. Xenophobic attacks across SA have cost many lives, displaced scores of people who now live in fear, and left businesses reeling. While the focus has been on business infrastructure that has been damaged, insufficient attention has been paid to how businesses conduct their affairs.

In a recent judgment the high court in Cape Town addressed the issue of discriminatory preferences by business, arising from a legal battle between international money transfer servicer Mukuru and the department of employment & labour.

Mukuru had a number of positions it wanted to fill, and advertised saying it preferred to hire employees who were fluent in the indigenous languages of Zimbabwe and Malawi, among others. The company’s argument in court was that this was necessary because the business is focused on the needs of foreigners from elsewhere on the continent who are living in SA, and it was imperative that Mukuru be in a position to service its clients in their native languages.

Mukuru maintained that South African employees would not be able to either communicate efficiently or relate to its customers on a cultural or ethnic basis. It advised the court that despite a diligent search, it had been unable to find suitably qualified SA citizens or permanent residents who could fill the various vacancies.

The pertinent question the court was required to answer was whether the lack of proficiency in the languages referred to made SA citizens or permanent residents unsuitable to occupy the positions available at Mukuru.

SA law permits fair discrimination but prohibits unfair discrimination. Section 6 of the Employment Equity Act specifically prohibits unfair discrimination directly or indirectly on grounds including race, ethnic or social origin, culture and language.

In addition, section 9(4) of the constitution provides that “no person may unfairly discriminate directly or indirectly against anyone on one or more grounds, including race, gender, sex, pregnancy, marital status, ethnic or social origin, colour, sexual orientation, age, disability, religion, conscience, belief, culture, language and birth.”

In coming to its judgment the Cape high court determined that the employees Mukuru sought to hire largely performed the function of receiving money from remitters for purposes of sending it to people they nominated in the designated country, on a form issued by Mukuru. Mukuru maintained that it needed to appoint foreign nationals from Zimbabwe and Malawi in particular because they spoke the languages used in those countries.

However, the court ruled that this requirement amounted to unfair discrimination, as there was insufficient operational justification furnished by Mukuru showing that this was an essential component of the services it provided.

Where the department alleged unfair discrimination the onus was on Mukuru to prove that the discrimination was in fact fair (as provided for in section 11 of the Employment Equity Act). It was unable to do so, and the exclusion of SA citizens therefore constituted unfair discrimination on grounds which included race, ethnic or social origin, culture, language and birth.

Where to from here? Companies need to be heedful of business preferences that unfairly discriminate. Consulting a legal expert may be of assistance in understanding what is or may be a business preference that unfairly discriminates, especially since SA’s employment and labour law is complex and dynamic.

For example, although the period for public comment on the draft National Labour Migration Policy & Employment Services Amendment Bill has closed, it proposes some important changes to the law. These include:

• Better regulation of the employment of foreign nationals in SA, in a manner consistent with the objects of the Employment Services Act, the Immigration Act and the Refugees Act. On the subject of foreign nationals the bill also grants the employment & labour minister the authority to specify a maximum quota for the employment of foreign nationals by employers in any sector.
• The bill introduces the notion Supported Employment Enterprises, a national government component contemplated in section 7A of the Public Service Act as an entity within the department to promote work and employment opportunities for persons with disabilities.
• It also recognises digital labour platforms. For purposes of the bill, a digital labour platform is said to be any person who provides work or services in the republic online.
• Finally, the bill grants the labour court the authority to impose a fine not exceeding R100,000 when there is a contravention.

The proposed bill could play a crucial role in better regulating SA’s employment and labour laws and helping avoid incidents of xenophobia. It is a clear indication of the direction SA employment and labour law is moving in.  Going forward, compliance with the law will be essential, since those businesses that choose not to comply are likely to face stiff fines.

• Mtshali, an attorney, is founder of The Legal Affair.