Many estate agents will be left unemployed and irreplaceable experience and knowledge will be lost because of black empowerment rules being imposed on estate agents, Johan Roos, organiser of the Solidarity Communication and Marketing Network, said on Tuesday.
The Property Practitioners Regulatory Authority (PPRA) has suddenly announced the requirement of level 8 black economic empowerment (BEE) scores for businesses in the real estate sector in order to obtain or renew fidelity fund certificates. This will require black ownership of more than 50% of most property businesses.
Without these certificates, real estate agents cannot legally do business. Solidarity has warned there will be large-scale job losses in the real estate sector if the implementation of strict racial rules as a condition for issuing fidelity fund certificates, is not prevented.
“We are utterly concerned about these new regulations and the threat they will pose to existing jobs,” he said, adding that the regulations would be opposed by the trade union to protect the work of Solidarity members.
“These targets are contrary to the agreement that Solidarity and the South African government signed in 2023 and which was later also made an order of court. According to the court order, no person may be dismissed based on race or as a result of race plans,” Roos said.
“Businesses will be hesitant to hire white staff as they will not be able to receive the necessary BEE points. Other businesses will have to resort to layoffs to meet these numbers.”
Approximately 30 000 of real estate agents are believed to be white and although it has been argued that sole proprietorships are not not being targeted, “this is not at all reassuring”, said Renate Pieterse, network co-ordinator of the public sector at Solidarity.
She said these small businesses represented a large number of the approximate 40 000 real estate and leasing agents in South Africa.
Several members of Solidarity had expressed their concerns about the new BEE rules – especially those who manage small businesses or sole proprietorships.
PPRA CEO Thato Ramaili said in a notice on the PPRA website last month that “we urge all property practitioners to take immediate action to ensure compliance with BEE regulations and to meet the skills development deadline (April 30, 2024). Failure to do so may result in regulatory consequences.”
The PPRA also began the manual registration of all currently registered or existing property practitioners, as from February 23, 2024.
“We would like to remind all principal property practitioners of the importance of Black Economic Empowerment (BEE) compliance…
“As outlined in section 50(a)(x) of the Property Practitioners Act, it is mandatory for all principal property practitioners to possess a valid BEE certificate.
“Failure to comply with this requirement may result in the inability to obtain or renew a fidelity fund certificate,” said Ramaili.
She said the April 30 deadline had marked the cut-off date for the submission of Workplace Skills Plans (WSP) and Annual Training Reports (ATR).
“It is imperative that all principal property practitioners whose salary bill is greater than R500k ensure they have met this requirement by the specified deadline in order to ensure that points from the skills element can be verified,” she said.
Entities with annual turnover of under R2.5 million qualify as exempt micro enterprises and aren’t subject to this regulation. The PPRA could not be reached for further comment on Tuesday.
BUSINESS REPORT