Is employment equity doing more harm than good?

Submitted by Paul Deppe

Discrimination in the workplace in some or other form has plagued South Africa since the early settlers inhabited the Cape in the 1600s. Colonialism ensured that the white population enriched themselves while depriving the indigenous population of social, political and economic power. At the turn of the 20th century the English enforced the ideology of territorial, political, educational and work-place segregation. Work-place segregation entailed both labour repression and discrimination. Practices such as the compound system, job reservation and wage discrimination where all designed to protect the white working class. During this period black people and the Afrikaner experienced domination by the English, as a result the English community prospered at the expense of others. In the late 1940s Afrikaner dissatisfaction about job and wage security led to National Party victory in 1948 and the beginning of apartheid. This event signalled the end of segregation and the start of apartheid. The National Party restructured the economy to free the Afrikaner from foreign, predominantly English capitalism. During this period not only did the social, political and economic exclusion of blacks worsen, but so did that of English-speaking South Africans. And so began the period of Afrikaner domination. The National Party ensured that government was made up mostly of Afrikaners, it created large parastatal organisations such as Iscor, Sasol and Eskom to provide employment for poor Afrikaners. When the ANC came to power in 1994 South Africans experienced another shift in domination, that by black people. The ANC has implemented a number of policies to advance the cause of black people. Policies of affirmative action, employment equity (EE) and broad-based black economic empowerment (BBBEE) all sought to achieve the advancement of black people. This has created insecurity among white people and resulted in a large exodus of whites to other countries creating a huge skills shortage.

The purpose of BBBEE is to create a broad base, encompassing large numbers of previously disadvantaged individuals, actively functioning in the mainstream economy in South Africa. Through this process the lives of the vast majority of black people who have been disenfranchised would improve. Wealth would be created and the vast majority of black people would formally enter the economy. The concept is noble except that over the last 14 years this is not what has happened. The fruits of this process have landed in the palms of a lucky few black people who have been able to create enormous wealth for themselves. A process that should have been in place for 10 years has yielded little wealth for the masses after 14. A process that should have been inclusive of all previously disadvantaged South Africans has become a black elitist wealth creator.

The demand for EE candidates has far outstripped supply. The education system is just not able to deliver enough quality candidates to feed industry. As a result and out of desperation many organisations have employed black professionals that are either not suitably qualified or lack the work experience to make a meaningful contribution toward the success of the company. Young people require both time and work experience to develop emotional intelligence and emotional maturity. The gathering of information at a learning institution is called knowledge. Young people leave their institution of learning with knowledge. Wisdom is the power of being able to use the knowledge gained in a practical work environment. One requires work experience to convert knowledge into wisdom and without wisdom one has the potential to fail. Given an environment where an individual is placed in a situation where the wisdom required is at a level higher than that of the individual, the individual will experience negative feelings of inadequacy, anxiety and often depression. This negativity makes people want to protect themselves, which results in not telling the truth, cover up and withdrawal from the situation and environment. The seeds of failure have been sown.

All too soon a young black manager or black professional is caught up in the heady spiral of BBBEE. The individual is placed in a position not for their knowledge and wisdom but rather because of the colour of their skin. Black individuals are often placed in positions where they find themselves out of their depth. The result is an individual who eventually fails with disastrous consequences. The amount of psychological trauma and damage creates scars for life. The confidence of a once confident individual is shattered. Often as a token appointment an individual is ridiculed and humiliated again causing emotional trauma. Tokenism helps nobody.

The zebra effect is common in South African organisations. This is where the very senior management, typically the board, and the shop floor workers are black. Sandwiched in between these two layers is white middle management. This is where the real intellectual capability of the organisation lies. This level is the engine room of the organisation. It is here where work is done and intellectual capacity becomes so critical. It is at middle management where knowledge and wisdom become critical. Failure through fast tracking black people or making token appointments creates far greater impact than doing the same at board level. The age-old adage, “you are only as strong as your weakest link” becomes so relevant. If fast tracking and tokenism is applied to the middle management level, this is where the greatest harm can be done placing the organisation at huge risk. It is at this level in the organisation where morale is impacted most. A black person fast tracked or sitting at this level as a result of tokenism will experience all the negative emotions and feelings of inadequacy and anxiety leading to the failure contemplated earlier. White managers on the other hand also transform into a negative state of mind with the very same feelings. The solution for a white professional or white manager is, however, very different. They will look at exiting the organisation leaving huge gaps of knowledge and wisdom. They will begin to develop negative feelings towards the country with the ultimate outcome being emigration to a country where their knowledge and wisdom will be valued for what they can contribute towards an organisation rather then on the colour of their skin.

What about coloured and Indian people? These people experienced some economic participation during the apartheid years and who, by law are now fully enfranchised. They are often discriminated against by both black and white managers. I have heard coloureds and Indians say that they are not black enough to be black or white enough to be white. These feelings once again manifest in negative emotions, which only serve to harden their points of view. Our society is creating a boiling pot that is destined to explode. A society is being created where racism is becoming the focal point and centre stage. Exactly the opposite of what the ANC fought for during the apartheid years.

The classification of BBBEE is also contentious. The Broad-Based Black Economic Empowerment Act defines broad-based black economic empowerment to mean the economic empowerment of all black people including women, workers, youth, people with disabilities and people living in rural areas through diverse but integrated socio-economic strategies. The word, black people, is a generic term which means Africans, coloureds and Indians. The intention of the act is to provide economic wealth to people who have been historically disadvantaged, this implies “black people”.

Today not all black people are disadvantaged. Consider the example of a young black boy who is educated at St John’s College, one of the top and most expensive private schools in Johannesburg. This child can hardly be considered to be disadvantaged. He has had all the benefits if not more than most other South African children, black or white. It would be inappropriate for this child to benefit from BBBEE sometime in the future, just as it is inappropriate for a wealthy black business man to benefit from BBBEE now. There are many white South Africans who today are disadvantaged. Fourteen years after South Africa’s first democratic election, just like many black people, these white people, for varying reasons, have not had the opportunity to participate in the formal economy. It would therefore be racist to exclude these poor white people based only on the colour of their skin. The definition of broad-based black economic empowerment must be reconsidered to include all disadvantaged citizens.

The level of skills in South Africa is probably the most important stumbling block for the successful implementation of BBBEE. If the skills do not exist it is simply not possible to place wise black people in beneficial positions because they are not available. A comprehensive strategy is required from government to address the skills gap in South Africa. This would need to consist of two thrusts, the first, to provide a sound education to every single South African regardless of the colour of their skin or their demographic distribution. The second thrust would be to provide scholarships for educational advancement of the poor. Education will increase the skills of existing employees. Education will create a workforce that is already empowered when they enter the economy. Education will allow individuals a greater amount of choice when making a career decision. Education will allow an individual to climb the corporate ladder quicker or become a successful entrepreneur quicker. A sound education will enable a greater degree of BBBEE at a quicker rate. Without the necessary skills base, empowerment will progress at a much slower pace than desired.

Thus, I contend that the current structure of broad-based black economic empowerment is ineffective and will not create the desired effect of providing empowerment for disadvantaged citizens. BBBEE is chasing away scarce resources from the country, which we can ill-afford. It is creating a small group of immensely wealthy black elitists.

What South Africa needs is to provide a sound education for every single citizen. This will empower people to make choices. We need to educate all our citizens to accept diversity, different values and different cultures. We need to preach tolerance in every form of the word. We need to create an environment where each and every citizen is embraced and feels wanted. Then and only then will we have created a rainbow nation where all South Africans will prosper regardless of their race, colour or creed.

I look forward to that day!

Deppe is the managing director of Concor Technicrete, a subsidiary of Murray & Roberts