M.Comm. (Economics) / Gender wage inequality in South Africa from 2001 to 2010 is investigated in this dissertation. This is done through the decomposition of the gender wage gap and quantile regression. It is shown that the gender wage gap in South Africa is highest both at lower and higher parts of the wage distribution. Moreover, the gender wage gaps at the 50th and 75th quantiles are either not statistically significant or they are in favour of women. It is shown that the gender wage gap is largely driven by the size of the coefficients component, even in the face of a positive characteristics component indicating that there is a level of discrimination along the wage distribution. In the assessment of the gender wage gap between black females and white males, it is shown that the gender wage gap is always in favour of white males. However, since it is lowest at higher points of the wage distribution, the conclusion is that black women at lower points of the wage distribution face the most adverse effects of the intersection of race and gender in terms of the gender wage gap. Moreover, black women at higher points of the wage distribution have been the most likely beneficiaries of the employment equity policies.

The notion of Decent Work has been broadly advocated since 1999 by means of various International Labour Organisation (ILO) Conventions. Through these Conventions and as part of its Decent Work Agenda, the ILO strives to foster the creation of social and economic systems, capable of ensuring basic security and employment and adaptable to rapidly changing local and global economic circumstances. The Decent Work Agenda has been widely accepted as an important strategy to eradicate poverty and enable socio-economic development. It is submitted that the concept of Decent Work as contemplated by the ILO, firstly focuses on the payment of an income, which allows the working individual a good life. It secondly strives to ensure that everybody has an equal chance to develop themselves; that working conditions are safe; that there is no instance of child and forced labour; and that discrimination does not occur. The elimination of discrimination in the workplace is not only an ever-evolving pursuit, given that it continues to manifest in innumerable forms, but it has also proven to be an extremely pervasive pursuit as evidenced by the jurisdiction-specific literature review in this study. The jurisdictions focused on in this study are the United States of America, the United Kingdom and Australia. This study concerns itself with pay-related discrimination which strains ILO Conventions No 100 and 111. Convention 100 focuses on equal pay for equal work and Convention No 111 focuses on the elimination of all forms of discrimination in the workplace. In spite of extensive legislative developments in the various jurisdictions which form part of this study, enhanced by the creation of various practical mechanisms to enable the elimination of pay-related discrimination, the stubborn problem of discriminatory pay practices has survived structured and deliberate attempts to get rid of it. In South Africa, the amendment to section 6(4) of the Employment Equity Act, assented on 1 August 2014, specifically describes a difference in conditions of employment between employees of the same employer performing the same or substantially the same work or work of equal value based on any one or more of the grounds listed in section 6(1), as unfair discrimination. This amendment therefore seeks to prohibit such unfair discriminatory practices. Based on the newness of this amendment and the fact that courts have not yet delivered judgments arising from litigation related to this particular amendment, a sense of uncertainty exists with respect to the adequacy of the amended section 6 in the Employment Equity Amendment Act. If progress in the other jurisdictions in this regard is anything to go by, there is no reason to believe that the amendment to section 6 will be a panacea capable of addressing all alleged discriminatory pay practices.

This paper compared the South African concepts of pay equity and equal pay for work of equal value with those of industrialised countries, including the United States, the United Kingdom, Australia and Canada. The study considered how South Africa recognized the right to promote equal pay, in the absence of a proper legal framework which expressly includes such a right. The paper also focused on the impact of statutes and case law on the developments of equal pay in the aforementioned industrialized countries. It also considered the impact of the decisions of the European Court of Justice on such developments as well as it impact on the interpretation of equal pay in these industrialised countries. The purpose of such comparison was not to transplant the legal system of these industrialised countries but to assist South Africa in remedying its weaknesses by creating legal rules for the promotion of equal pay for work of equal value.

This paper compared the South African concepts of pay equity and equal pay for work of equal value with those of industrialised countries, including the United States, the United Kingdom, Australia and Canada. The study considered how South Africa recognized the right to promote equal pay, in the absence of a proper legal framework which expressly includes such a right. The paper also focused on the impact of statutes and case law on the developments of equal pay in the aforementioned industrialized countries. It also considered the impact of the decisions of the European Court of Justice on such developments as well as it impact on the interpretation of equal pay in these industrialised countries. The purpose of such comparison was not to transplant the legal system of these industrialised countries but to assist South Africa in remedying its weaknesses by creating legal rules for the promotion of equal pay for work of equal value.

The consolidation of 22 years of democracy and 20 years of the Constitution of the Republic of South Africa entrenched the need to eradicate social and economic inequalities, particularly those that stem from our history of colonialism, apartheid and patriarchy, which brought pain and suffering to the great majority of our people, in particular Black people. Therefore, the passing of the Constitution of the Republic of South Africa (Constitution)1 20 years ago, marked a turning point in our history by giving expression firstly, to the Freedom Charter and secondly, by upholding the values of human dignity, equality, freedom and social justice in a united, non-racial and nonsexist society where every South African may flourish. However, despite the fact that the Bill of Rights in the Constitution provides that everyone is equal before the law and that equality includes the full and equal enjoyment of all rights and freedom, discriminatory practices, in particular, pay inequalities, are still rife in our country. It is against this backdrop that the historical background of the employment discrimination law in South Africa, which over a period of time, contributed significantly to the high levels of inequalities in pay experienced by the previously disadvantaged groups, such as Black people, women and people with disabilities becomes critical. This aspect points to the importance of understanding the context within which the principle of “Equal Pay for Work of Equal Value” has been and should be implemented in South Africa compared to Canada. Therefore, drawing from the review of the legislation and the implementation processes of the principle of equal pay for work of equal value, the following best practices/ lessons learned were identified: 108 of 1996. The Canadian Ontario Pay Equity Act states that the value of job classes be based on factors such as skill, effort, responsibility and working conditions. This Act also requires the employer to take proactive steps to institute a jobevaluation scheme, and the participation of the social partners and the affected workers is crucial. It is submitted that there are similarities in these requirements with those contained in the Employment Equity Regulations, 2014, which implies that the South African legislative framework draws on this best practice. The Ontario Employment Standards Act allows the comparison to be drawn with the establishment of the same employer in the same municipality, as well as with establishments to which a worker can be transferred. In this regard, it is observed that the new provisions on equal pay in section 6(4) of the Employment Equity Amendment Act, 2013, limits only the comparison with the employees of the “same employer” without elaborating further into the same municipality or with establishments to which a worker can be transferred. Under Ontario Pay Equity Act, even if there is no precise comparator in the establishment doing work of equal value, the employer must ensure that the worker’s pay is proportionate to others doing work of proportionate value. In the context of South African legislation, a comparison on the basis of proportionate value is not catered for. The meaning of “work of equal value” refers to the work that is the same (identical or interchangeable), substantially the same (sufficiently similar), or of equal value (accorded the same value) when compared to an appropriate comparator. In justifying equal pay, the Ontario statute provides that formal seniority systems and performance-related pay can justify unequal pay only if they do not discriminate on the grounds of gender. This is similar to the South African statute, in particular, regulation 7 of the Employment Equity Regulations, 2014, which include seniority and performance as some of the factors that may justify unequal pay only if they do not unfairly discriminate on one or combination of the listed grounds, and on any other arbitrary ground as prescribed by section 6(1) of the EEA as amended. As per the Ontario legislation, the employer cannot reduce the rate of remuneration in order to comply with the principle of equal pay for work of equal value. Similarly, in the South African legislation, in particular, regulation 7 of the Employment Equity Regulations, 2014, it prevents levelling down of pay in instances of demotions and in transfer of contracts (section 197 of the LRA). There is a requirement in terms of the Ontario Pay Equity Act, that employers must establish and maintain pay equity in their establishment in consultation with the bargaining agent (trade unions); and after the agreement, post a Pay Equity Plan in its workplace. In terms of South African legislation, the EEA does not have a requirement for a Pay Equity Plan, however, designated employers (those required to comply with Chapter III of the EEA) are required in terms of sections 19(1) and 20 of the EEA to conduct a review of their workplace policies, practices and procedures, inclusive of remuneration and benefits; and develop and implement affirmative-action measures to address any unfair discrimination practices by including these measures in their Employment Equity Plans. Furthermore, in terms of section 27 of the EEA, designated employers are then required to submit their annual Income Differential Statements to the Employment Conditions Commission (ECC) on the remuneration and benefits received in each occupational level of that employer’s workforce. In relation to dealing with pay-equity disputes, the Ontario Pay Equity Act, establishes a Pay Equity Commission, which consists of a Pay Equity Office, inclusive of Review Officers and the Hearings Tribunal that are mandated to specifically enforce the equal-pay-for-work-of-equal-value principle. Contrary, in South Africa, the legislation does not cater for the establishment of a Pay Equity Commission with exclusive mandate to deal with pay-equity cases. In this regard, the various courts and the CCMA which are mandated to deal with equal-pay disputes are also mandated to deal with other labour disputes emanating from other labour legislation, e.g. the LRA, BCEA, EEA, UIA, OHSA, COIDA, etc. The Review Officers in the Pay Equity Office in Ontario are mandated to monitor the implementation and maintenance of the Pay Equity Plans as per section 34 of the Pay Equity Act in Ontario. In South Africa, the EEA makes provision for DG Review process in terms of section 43, where the DG of Labour can subject any organization for a review to assess its compliance with the requirements of the EEA as whole, and not specifically to assess the implementation of the principle of equal pay for work of equal value. Notably, assessment of income differentials to promote equal pay may form part of the DG review process. In light of the above best practices / lessons learned, the following recommendations are made to inform the improvement plans of the implementation of the principle of equal pay for work of equal value in the South African labour market: Conducting of continuous advocacy campaigns to raise awareness and educate all stakeholders, i.e. employers, employees and trade unions on the principle of equal pay for work of equal value. Development of further policy guidelines in relation to equal pay consultations within the workplace between the employer and the employees, including where applicable registered trade unions. A policy directive on the “equal-pay consultation” will promote not only transparency around pay and benefit structures, but will encourage proactive measures from employers to develop pay/remuneration policies, including establishing remuneration committees; conducting job evaluations; implementing job-grading systems and performance-evaluation systems to promote the implementation of the principle of equal pay for work of equal value. 2 SS 115(4) and 158(1)(j) of 66 of 1995. Minimum wage-setting bodies should have the duty to apply the principle of equal pay for work of equal value in the setting of minimum wages. Collective bargaining structures such as bargaining councils should have a duty to apply and enforce the principle of equal pay for work of equal value in the wage-negotiation process and conclusion of collective agreements. Given the importance of collective bargaining in wage-setting in South Africa, there should be a duty on the social partners to include the principle of equal pay for work of equal value in all collective agreements. Industry-wide comparisons should be utilized, particularly in sectors in which collective bargaining operates at a sectoral level. Alternatively, the “Proxy” method as developed in Ontario, should be considered. Proportionate pay, as developed in Ontario, should be considered in cases where there is no comparator doing work of equal value, employed by the same employer. Possible legislative amendments to section 27 of the EEA to include a new provision, requiring employers to develop and implement a Pay Equity Plan outlining how they intend complying with the principle of equal pay for work of equal value. Then an annual progress report must be submitted to the Director General of Labour on how the Pay Equity Plan has been implemented instead of the current submission of an Income Differential Statement to the ECC. Finally, compliance with the principle of equal pay for work of equal value is required as a condition for accessing State Contracts under section 53 of the EEA when this section is promulgated in the near future. It can be deduced from the review process that the principle of equal pay for work of equal is a complex and specialized area. However, it was also clear that in both South Africa and Canada, the issue of equal pay is seen, not only as a workplace issue, but as an important Constitutional fundamental human-right imperative to the achievement of equality in a society as a whole.