South Africa's DA party challenges new racial equity law in court

South Africa's Democratic Alliance party went to court on Tuesday to challenge new employment equity legislation which sets out numerical targets for the number of non-white people that companies should employ.

The pro-business DA, the second-biggest party in government, says the new law violates anti-discrimination clauses in the constitution and gives the state too much regulatory power.

Its larger coalition partner, the African National Congress, says the DA is trying to "preserve the apartheid-era economic status quo" and thwart its efforts to correct racial imbalances in the workplace that are apartheid's legacy.

Statistics show that South Africa's companies are still dominated by white people at the top, with Black employees mainly occupying lower-level roles. Unemployment is much higher among Black citizens.

'About flexibility'

Lawyers for the two sides made their opening arguments on Tuesday at the North Gauteng High Court in Pretoria.

"This case is about flexibility," said DA lawyer Ismail Jamie in court, adding that it is fine to set aspirational targets but not ones "so rigid that they constitute a quota", which he claimed the new ones do.

Race remains a highly charged topic in South Africa three decades after the end of white minority rule. The DA's national leader is white and the party has a reputation for defending the interests of the white minority, which it denies.

The Employment Equity Amendment Act, which took effect this year, updates a 1998 act that required employers to set diversity targets and report on their progress in meeting them.

Risk of fine for non-compliance

It is separate from an existing Black economic empowerment law which many critics say hasn't worked.

That policy also sets targets for the number of Black people at management level, but firms can avoid it by earning points in other categories such as ownership or skills development. There is no penalty for non-compliance.

Under the new law, companies with more than 50 employees must meet sectoral targets for the number of non-white people, women and disabled people in skilled and senior roles, or justify their failure to do so.

Firms that do not comply could lose government contracts and be fined.

'Never going to see required transformation'

"If we continue the way that we are, we're never going to see the transformation that is required because people... will never get to top management," said Muriel Mushariwa, a law lecturer at the University of the Witwatersrand and an employment equity consultant.

She added, however, that it could be difficult for companies to comply with the new equity law and the Black empowerment programme, whose targets are broken down into different categories and not aligned.

The DA says it supports redress but sees job creation as the primary solution.