Labour Minister welcomes signing into law of Companies Amendment Act

Employment and Labour Minister Nomakhosazana Meth has commended the signing into law of the Companies Amendment Act by President Cyril Ramaphosa. President Ramaphosa signed into law amendments to the Companies Act of 2008 on Friday, which promote the ease of doing business and impose greater corporate transparency on the earnings gap between the highest and lowest paid persons in a company. The Companies Amendment Bill and Companies Second Amendment Bill, which were referred to the President for assent, jointly constitute initiatives by government to make the conduct of business less burdensome. They also tighten the pursuit of delinquent directors or prescribed officers for wrongdoing, including State capture, and addresses disparities in earnings. The Companies Amendment Act, as signed by the President, streamlines company law to be clear, user-friendly and less burdensome on the conduct of business. This reform is important for the efficient and effective conduct of the domestic economy, as well as the attraction of foreign investment. The Act is also aimed at achieving equity between directors and senior management on the one hand, and shareholders and workers on the other hand. According to Meth, this law has a direct linkage to the Employment Equity Amendment Act, 2022, particularly section 27, which refers to the statement of income differentials required from designated employers. Meth said the requirement of disclosure by companies of the average and median total remuneration of all employees, the remuneration gap between the total remuneration of the top 5% highest paid employees, and the total remuneration of the bottom 5% lowest paid employees of the company, will go a long way in exposing existing inequalities in employment. 'As a result, the work done by the Department of Employment and Labour to transform the labour market will be strengthened, as the two pieces of law are complementing each other and will ensure more transparency from the employers. 'Through our departmental inspectorate, we will promote, strengthen and enforce compliance of our labour laws, as we strive for a labour market that is conducive to economic growth,' Meth said. Source: South African Government News Agency