Disability and BBBEE

With new amendments to the Broad-based Black Economic Empowerment (BBBEE) Act introduced in December, now is the perfect time to revisit its implications for disability. Rustim Ariefdien provides an overview

The BBBEE Act essentially works on the understanding that years of systemic racism contribute to contemporary economic woes and that government intervention can stem the results of past racist regimes.

Companies determine their BBBEE scorecard points through their BBBEE level. There are eight levels, with the desired range covering Level 1 to Level 4. Government procurement is targeted at Level 4 and above. Points are attributed within five sectors, namely ownership, management, skills development, enterprise and supplier development, and socio-economic development.

The BBBEE process is onerous for a company because it is required to provide the appropriate evidence when the BBBEE status is verified by an accredited verification agency. Points are mainly earned through expenditures, although some categories are based on numbers, such as how many black individuals with a disability are employed.

Disability and BBBEE

Disability has been misunderstood at times. The BBBEE scorecard specifically mentions disability in the management element with two points available if at least two percent of a company’s workforce is black individuals with a disability. If an organisation spends at least 0,3 percent of its payroll on skills development for black individuals with disabilities – whether or not they are employed by the organisation – it is awarded four points.

However, these are not the only instance in which people with disabilities can benefit. In the ownership category, the Act mentions black designated groups, which includes disability. Thus a company can earn three points if two percent of the company is owned by a black individual with a disability.

Under the enterprise and supplier development element, companies can score two points for procuring from black designated groups, including people with disabilities. The socio-economic development factor allows companies to score up to five points when they provide funding to non-profit organisations that service people with disabilities.

Big payoffs from including disability

In summary, within the areas of the BBBEE Act that specifically mention disability, there are six points available, with another additional 10 points available in areas where disability is inferred.

These add up to a total of 16 BBBEE scorecard points – a significant amount. Furthermore, in many instances the value of disability intervention would earn additional points and qualify for tax benefits.

Throughout the year, in a series of articles on BBBEE and disability, I will look at each of the elements and demonstrate how people with disabilities may benefit from BBBEE as employees or entrepreneurs, and how disability organisations could benefit through engagement with companies.

It is imperative that people with disabilities understand the criteria from companies, whereas disability organisations need to understand how BBBEE can be a valuable income stream that contributes to their sustainability. This Act is a great enabler that needs to be studied and understood by the entire disability community so that people with disabilities can be better integrated within South Africa.