This is part 2 in a series of blogs on equal pay for work of equal value as provided for in the Employment Equity Amendment Act of 2013. The introduction to this topic can be found here. In this blog I will discuss the new Regulations prescribing the criteria and methodology for assessing work of equal value (effective 1 August 2014) .
As mentioned previously, where an employee alleges that he/she:
- has different terms and conditions of employment
- from a colleague who does work of equal value to him/her and
- such different terms and conditions of employment are due to unfair discrimination,
the employer would have to prove that:
- no discrimination took place (i.e. there is no difference in terms and conditions of employment, or the jobs are not “work of equal value”)
- the differences are rational and not unfair
- the differences are otherwise justifiable.
Regulations prescribing the criteria and methodology for assessing work of equal value
The Minister of Labour has published Regulations prescribing the criteria and methodology for assessing work of equal value. What follows is a summary of the tests the CCMA (or Labour Court) will apply in adjudicating cases based on these Regulations:
1. It must first be established:
- whether the work is actually work of equal value, and
- whether there is actually a difference in terms and conditions.
2. Then, it must be established that such difference constitutes unfair discrimination.
Assessing whether the work is work of equal value
According to the Regulations prescribing the criteria and methodology for assessing work of equal value, the relevant jobs must be objectively assessed taking into account:
- the level of responsibility demanded (for people, finances and material)
- the skills, qualifications (incl. prior learning and experience) required
- the physical, mental and emotional effort required
- the conditions under which the work is performed, (incl. physical environment, psychological conditions, times and geographic location of work)
- any other factor the employer can prove is relevant to assessing the value of the work.
Factors justifying differentiation in terms and conditions of employment
The Regulations prescribing the criteria and methodology for assessing work of equal value point out that it is not unfair discrimination if the difference is fair and rational and is based on any one or a combination of the following grounds:
- seniority or length of service
- qualifications, ability, competence or potential
- performance, quantity or quality of work, provided that employees are equally subject to the employer’s performance evaluation system, and that the performance evaluation system is consistently applied.
Also acceptable are differences due to:
- past demotion without salary reduction
- temporary appointments for gaining experience or training
- a shortage of relevant skill, or the market value in a particular job classification
- any other relevant factor that is not unfairly discriminatory.
So, if you end up in the CCMA needing to defend yourself against such an allegation, you have a few opportunities to win your case:
- prove there is no difference in terms and conditions
- prove that the work is not actually work of equal value
- prove that the differentials in terms and conditions are fair and rational, and that their wider application is not unfairly biased against anyone or any specific group.
Return on Investment
Differences in terms and conditions are key to good talent management: you should reward the right people for the right things. The Regulations prescribing the criteria and methodology for assessing work of equal value actually serve the best interests of the enlightened organisation that seeks to align its reward system with its business goals, as they provide added motivation to base such decisions on objective value-adding factors. In future blogs I will explore and discuss the grounds for structuring reward systems. The Regulations mention a number of legally acceptable grounds:
- Seniority or length of service.
- Qualifications, ability, competence or potential.
- Performance, quantity or quality of work.
In future posts I will look at each of these from a return on investment point of view. Just because it’s legal, doesn’t mean it’s a good idea!