LETTER: Resist the moves towards job quotas

SA’s unemployment rate is at 46.6% on the expanded definition, which includes discouraged jobseekers. It is a crisis that threatens the stability of the nation, as the July riots showed. It is also an affront to human dignity, and a betrayal of the hopes and aspirations of millions of poor South Africans.

The government knows this, with Treasury director-general Dondo Mogajane recently saying SA is at risk of becoming a failing state. One would expect the government to strain every sinew to promote job-creating economic growth and avoid that fate.

Yet instead it is resorting to job reservation. Labour minister Thulas Nxesi wants to introduce workplace quotas for foreigners, setting caps on the share of foreign workers companies are permitted to employ in some industries and banning them from others. If the minister has his way there will be different limits set for foreign workers in restaurants, mines, trucking and schools.

Not content with micromanaging companies that employ foreign workers, he also proposes race quotas for South Africans. If the Employment Equity Amendment Bill, which is before the National Council of Provinces becomes law, the labour minister will have the power to set binding race-based “numerical targets” — race quotas in all but name — across the economy. He will be empowered to define economic sectors and set different quotas for different sectors. He will be able to do the same for different regions.

Failing to meet these race reservation targets repeatedly can lead to punitive sanctions of up to 10% of a company’s annual turnover. Companies that fail to comply with the minister’s diktats will also be barred from state contracts and may have existing contracts cancelled. 

It doesn’t take much to imagine the opportunities for kickbacks in state procurement these rule changes will create. Patronage networks will flourish and in 10 years a new state capture commission will be established to figure out what went wrong.

The ideas underpinning these labour policies are a sure-fire way to cause even greater damage to SA’s teetering economy. They will tank growth and destroy jobs, and the victims will be poor and unemployed South Africans. They will accelerate SA’s slide towards failing state status.

The Institute of Race Relations (IRR) is therefore calling on President Cyril Ramaphosa not to sign the bill into law when it reaches his desk. A petition form has been made available on the IRR website for South Africans who wish to join the call.

John Endres, CEO, IRR

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