Employment Equity Reporting 2026/27: What Designated Employers Need to Know

The Employment Equity reporting window for the 2026/27 cycle opened on 1 September 2026 and runs until 15 January 2027. For designated employers, this window carries more weight than last year’s submission did. The 2025/26 cycle was a baseline exercise, employers filed their workforce profiles and Employment Equity Plans without being measured against a target. This cycle is different. It is the first year the Department of Employment and Labour will assess designated employers against the sector-specific numerical targets introduced under the Employment Equity Amendment Act.

What Changed Under the Employment Equity Amendment Act

The Employment Equity Amendment Act 4 of 2022 came into effect on 1 January 2025, and it reshaped two things that matter to almost every mid-sized employer: who counts as a designated employer, and what designated employers are required to achieve. Designated employer status is now determined by headcount alone. An employer with 50 or more employees is a designated employer, regardless of annual turnover. The previous turnover threshold, which allowed some smaller, high-revenue businesses to remain outside the Employment Equity framework, no longer applies. Organs of state remain designated regardless of employee numbers, and smaller employers can still apply voluntarily for a compliance certificate if they want to tender for state work.

In April 2025, the Department published sector-specific numerical targets covering 18 national economic sectors. These targets apply to four upper occupational levels and form part of a five-year Employment Equity Plan running from 1 September 2025 to 31 August 2030. The target for employment of persons with disabilities also increased, from 2% to 3%, across all sectors. These are not internal guidelines that employers can adapt to their own circumstances. They are regulatory targets, published in terms of the Act, that the Department will use to measure compliance.

Why This Reporting Cycle Is Different From Last Year’s

Employers who went through the 2025/26 reporting cycle may reasonably assume this year’s process looks the same. It doesn’t. The reporting window that closed on 15 January 2026 was explicitly treated as a baseline submission. Employers filed their workforce profile (EEA2) and their Employment Equity Plan progress report (EEA4), but the Department did not yet compare those figures against the sector-specific targets. The window that opened on 1 September 2026 is different. This is the first cycle in which the Department will assess designated employers’ actual progress against the first-year targets set out in their five-year Employment Equity Plans. Where a workforce profile falls short of its target, the Department expects a defensible, documented explanation, not a general statement of intent. For businesses that treated last year’s submission as a formality, this cycle calls for a different level of preparation.

Legal Certainty, and the Cost of Non-Compliance

Several stakeholders challenged the constitutionality of the sector-specific targets and the process used to publish them. Those challenges have not succeeded. The Gauteng High Court dismissed an urgent challenge in August 2025, and further attempts to have the regulations set aside failed at both the Supreme Court of Appeal and the Constitutional Court in March 2026. For planning purposes, the targets are settled law.

The practical consequences of non-compliance are also more concrete than in previous years. An Employment Equity Compliance Certificate, valid for 12 months, is now a requirement for any business seeking to do work with the state. Under Schedule 1 of the Act, a first contravention relating to sectoral targets can attract a fine of the greater of R1.5 million or 2% of annual turnover, escalating for repeat contraventions to the greater of R2.7 million or 10% of annual turnover.

What an Audit-Ready Employment Equity File Actually Contains

An Employment Equity submission is more than a form filed on the Department’s online portal. If a business is selected for review, its file needs to stand up to scrutiny. In practice, an audit-ready Employment Equity file includes:

• An accurate, current workforce profile (EEA2) that reconciles with payroll records, job titles, occupational levels and demographic information as they actually appear in the business, not as they appeared when the plan was first drafted.
• An Employment Equity Plan progress report (EEA4) that reflects genuine, documented progress against the applicable sector target, with a clear and defensible explanation for any shortfall.
• Supporting documentation, recruitment records, promotion criteria, training records and remuneration data, that backs up the figures in the workforce profile rather than contradicting them.
• Evidence of consultation with a duly constituted Employment Equity Committee, where applicable.

Gaps between these documents are exactly what draws attention during a Department review, and they’re avoidable with the right preparation.

Where IT, Engineering, Skills Development and Training Employers Get Caught Out

Employers in fast-moving, skills-scarce sectors tend to run into the same few issues. IT and engineering employers often bring on senior, scarce-skills specialists quickly, and job titles or occupational levels in the HR system don’t always keep pace with actual roles and responsibilities, which distorts the workforce profile that feeds into the Employment Equity report. Skills Development Providers and training companies, who already manage significant SETA and WSP/ATR reporting obligations, sometimes treat Employment Equity as a separate, lower-priority exercise, even though the same underlying workforce data drives both processes. In both cases, the underlying issue is the same: the data behind the Employment Equity Plan hasn’t kept pace with the business.

How LBD Consultants Can Help

LBD Consultants’ Employment Equity Division supports designated employers through the full reporting process, confirming designated employer status, reviewing workforce data against sector-specific targets, preparing EEA2 and EEA4 submissions, and building an Employment Equity file that can withstand a Department review, not just meet a submission deadline. Where a business’s underlying payroll or HR data needs attention first, our Employment Equity, Payroll and HR Divisions work from the same client information, so the figures in your Employment Equity Plan are consistent with what’s actually happening in the business.

With the 2026/27 reporting window open and the first substantive assessment against sector targets now underway, the time to confirm your designated employer status and get your Employment Equity file in order is now, not in January.