Equal Pay for Work of Equal Value

The principle of equal pay for work of equal value is geared towards eliminating a particular form of workplace discrimination: differentiation in pay on the basis of a ground listed in section 6(1) of the Employment Equity Act, 1998 (the Act) or any other impermissible arbitrary ground. Section 6(1) of the Act prohibits unfair discrimination in any employment policy or practice, on one or more of the grounds listed in the section, or on any arbitrary ground. These grounds include, for example, race, gender, age, language and sexual orientation.

The inclusion of section 6(4) in the new Employment Equity Amendment Act, 2013 (the amended Act) does not change the law in substance but now expressly accommodates claims of equal pay for work of equal value in the general prohibition against unfair employment discrimination. The DEA embraces this legislation and is committed to maintaining a remuneration practice and policy that is compliant with the legislation.

Section 6(4) provides that a difference in terms and conditions of employment between employees of the same employer performing the same or substantially the same work or work of equal value that is directly or indirectly based on any one or more of the grounds listed in subsection (1) or any other impermissible or arbitrary ground is unfair discrimination.

In terms of the draft Employment Equity Regulations, 2014 (the Regulations), the work performed by an employee:

• Is the same as the work of another employee of the same employer, if their work is identical or interchangeable
• Is substantially the same as the work of another employee, if the work performed by the employees is sufficiently similar that they can reasonably be considered to be performing the same job, even if their work is not identical or interchangeable;
• Is of the same value as the work of another employee in a different job, if their respective occupations are accorded the same value to the DEA or its entities in accordance with regulations 3 to 5.

In order to assess whether an employer contravenes section 6(4) it must first be established that the work is the same or similar or of equal value.

In making this assessment, the following factors must be considered:

• the responsibility demanded of the work, including responsibility for people, finances and material;
• the skills and qualifications, including prior learning and experience required to perform the work, whether formal or informal;
• physical, mental and emotional effort required to perform the work;
• to the extent that they are relevant, the conditions under which work is performed, including physical environment, psychological conditions, time when and geographical location where the work is performed.

The factors listed above will not necessarily be relevant to every job in the Department or in the entities. Thus in addition to the factors discussed above, any other factor indicating the value of the work to the employer may be taken into account in evaluating the work, but the DEA or its entities will have to show that the factor is relevant to assessing the value of the work.

If it is established that the work concerned is the same, similar or of equal value and that there is in fact a disparity in remuneration, it must be proven that the disparity constitutes unfair discrimination. If the disparity is alleged on one of the listed grounds, the employer will bear the onus to prove that the disparity does not amount to unfair discrimination. If the disparity is alleged on an arbitrary ground, the employee will have to prove that it does amount to unfair discrimination.

There are various factors that could justify differentiation in pay, and these include:

• the individuals’ respective seniority or length of service
• the individuals’ respective qualifications, ability, competence or potential above the minimum acceptable levels required for the performance of the job
• the individuals’ respective performance, quantity or quality of work, provided that the employees are equally subject to the DEA or its entities evaluation system and that the performance evaluation system is consistently applied
• where an employee is demoted as a result of organisational restructuring or as a result of any other legitimate reason without a reduction in pay and fixing the employee’s salary at this level until the remuneration of employees in the same job category reaches this level
• where an individual is employed temporarily in a position for purposes of gaining experience or training and as a result receives different remuneration or enjoys different terms and conditions of employment
• the existence of a shortage of relevant skill, or the market value in a particular job classification
• any other factor that is not unfairly discriminatory in terms of section 6(1).

If a disparity in remuneration is based on a ground listed in section 6(1) or any impermissible arbitrary ground and there is no justification for such disparity, the DEA or its entities could be at risk of a finding of unfair discrimination.

In such circumstances, the Labour Court has wide ranging powers as regards the relief it might order, including that the employer must:

• eliminate the unfair discrimination;
• pay damages and/or compensation to the employee;
• pay the relevant employees at the same level;
• take steps to prevent the same unfair discrimination or a similar practice occurring in the future in respect of other employees.

Written by:

Bryden Morton
Data Manager
B.Com (Hons) Economics
[email protected]

Chris Blair
CEO
B.Sc Chem. Eng., MBA – Leadership & Sustainability
[email protected]