Home Affairs to prioritize employment of local workers

IMPACT – MEDIUM

What is the change? In a recent speech, Home Affairs Minister Malusi Gigaba addressed the issue of a potential overreliance on foreign workers in certain industry sectors and stated that the government will prioritize the management of international migration to better benefit local workers.

What does the change mean? Although the speech specifically referred to a meeting with the hospitality industry last month, Gigaba said that the South African government “has a duty to ensure proper monitoring mechanisms are in place for South Africans to benefit the most from economic and employment growth, across all sectors,” and emphasized rules requiring certain companies to maintain a 60-percent ratio of local-to-foreign workforce. He also used the opportunity of the speech to announce the Department of Home Affairs’ intention to increase compliance activity to ensure that South African citizens and permanent residents are prioritized in local recruitment processes.

• Implementation time frame: Ongoing.
• Visas/permits affected: Work permits.
• Who is affected: South African employers.
• Business impact: Businesses that rely heavily on foreign workers may see tighter restrictions and greater government compliance activity to ensure increased hiring of South African workers.

Background: In his speech Jan. 31, Gigaba said that a “burning issue” and “grave concern” is that many businesses, particularly in the construction and hospitality sectors, do not hire South African citizens and prefer to hire foreign workers.

“It is a matter we cannot put aside, thus its prioritization going forward. And so we have resolved this year to pay serious attention to this matter…,” Gigaba said.

Although the Minister cited the 60-percent rule, it is limited to certain immigration circumstances, i.e., to companies that have been issued a corporate visa or companies established by a foreign national who has been issued a business visa on the basis of starting or investing in a South African company. Furthermore, the requirement is that the workforce of such companies must be at least 60 percent South African citizens or permanent residents, and not South African citizens alone.

BAL Analysis: The speech signals that the Department of Home Affairs is seeking greater localization efforts by companies and is prioritizing policies to favor employment of South African citizens.

This alert has been provided by the BAL Global Practice group. For additional information, please contact your BAL attorney.

Copyright © 2017 Berry Appleman & Leiden LLP. All rights reserved. Reprinting or digital redistribution to the public is permitted only with the express written permission of Berry Appleman & Leiden LLP. For inquiries please contact copyright@bal.com.