📘 TITLE:
Fair Pay Across Job Levels

A Summary of Willem Albertus Liebenberg’s Master’s Thesis (2023)

📍 UNIVERSITY:
Stellenbosch University – Faculty of Economic and Management Sciences
🎓 Degree: Master of Commerce

📅 Date: June 2023
________________________________________
⚖️ What’s the Problem?

South Africa’s Employment Equity Act (EEA) of 1998 requires employers to:

1. Ensure equal pay for work of equal value.
2. Eliminate unfair income gaps between job levels.
But the law and reporting forms don’t clearly explain what counts as “unfair” or “disproportional” pay/income differences. This makes it hard to track or fix.
________________________________________
🛠️ What Did the Study Do?

This thesis:
• Clarifies what counts as income (e.g., salary, benefits, bonuses).
• Suggests improving the current job level system (moving from 6 to 7 levels).
• Proposes a new statistical method—exponential regression—to check whether pay is fairly distributed across job levels.
• Offers tools to spot unfair outliers, i.e., employees paid unusually more or less than others at the same level.
________________________________________
💡 What’s the Big Idea?

Liebenberg proposes a full framework for:
• Measuring whether pay differences are proportional and fair.
• Giving the Employment Conditions Commission (ECC) clear tools to assess companies.
• Helping employers take proactive steps to stay compliant with the law.
• Improving HR practices like salary planning, recruitment, performance rewards, and union talks.
________________________________________
🚀 Why Does It Matter?

This research:
• Makes the EEA’s pay rules easier to apply.
• Encourages fairer workplaces and stronger labour rights.
• Equips employers with strategic HR tools that go beyond legal compliance.
• Helps turn remuneration data into meaningful decisions.
________________________________________
🔍 What’s Next?

• The method was tested on simulated data—real-world testing is needed.
• Liebenberg recommends developing norms and standards so companies know when their pay structures are “off balance”.

A Simpler Story of the Thesis: Fair Pay and Job Levels in South Africa

Willem Liebenberg’s thesis looks into a complicated but important question in South Africa’s labour world: How do we make sure people are paid fairly, especially when they’re doing very different types of work at different job levels?

The law—specifically the Employment Equity Act (EEA) of 1998—says that employers must do more than just pay people the same if they do the same job. They must also avoid big, unfair gaps in pay between different job levels.

But there’s a problem: the law doesn’t explain very clearly what those fair differences in pay should look like, or how to tell when the differences are unfair. Employers have to fill in a form (called EEA4) to show their pay structures, but this form mixes things up—

    • it confuses unfair group-based pay discrimination (like race or gender bias)
    • with general unfair differences between job levels.

So, Liebenberg set out to fix this by offering a clearer picture of what

  • “proportional pay differences” mean and
  • how we can measure them.

What the Study Did

1. Defined Key Concepts:

First, Liebenberg dug into what we mean by “pay,” “income,” and “remuneration.” He proposed criteria for deciding what counts as part of a person’s pay—like salary, bonuses, and other benefits—so that companies can’t hide unfairness by playing with definitions.

2. Reviewed Job Level Systems:

He looked at how companies categorize different jobs and suggested improvements to the six-level system currently used in South Africa. He supports an idea from another researcher (Giles) to move to a seven-level system to better reflect the true value of work people do.

3. Used Statistics to Measure Fairness:

The heart of the study lies in using a mathematical method called exponential regression analysis. This lets employers (and the government) look at actual pay data and see:

o Whether their pay differences between job levels are reasonable.
o Which individual employees are paid far more or less than expected, possibly showing signs of unfair discrimination.

4. Built a Framework:

All of this was put into a practical framework the Employment Conditions Commission (ECC) can use. This tool helps them judge whether companies are sticking to the rules, and it helps employers spot problems early and fix them.
________________________________________

Why This Matters

Liebenberg doesn’t just want to help the government catch problems. He also wants to help businesses take the lead in making pay fairer—not just because they have to, but because it’s smart and ethical.

With his system, companies can:

• Check if they’re following the law before they get into trouble.
• Use the data in union talks or salary planning.
• Plan better salaries to attract and keep good staff.
• Reward top performers fairly and transparently.
________________________________________
What’s Next

The thesis ends by urging more research. The method works on a simulated dataset, but now it needs to be tested with real company data. He also suggests building a set of norms and benchmarks, so there’s a clear standard to follow for what “fair” actually looks like.

In the long run, he hopes this work will lead to:

• Stronger laws with clearer guidelines.
• More fairness in workplaces across the country.
• Better tools for both government and companies to make sure no one gets unfairly underpaid.
________________________________________

Summary of Willem Albertus Liebenberg’s thesis in simple terms:

________________________________________
Fair Pay Across Job Levels: A One-Page Summary of Liebenberg’s Thesis (2023)

What’s the Problem?
South Africa’s Employment Equity Act (EEA) of 1998 tells companies to:

1. Pay people fairly for doing the same or similar work.
2. Make sure there aren’t unfair pay gaps between different job levels.
But the law doesn’t clearly explain what “unfair gaps” (called disproportional pay differentials) actually look like—or how to measure them. The reporting system (EEA4 form) is also unclear and mixes up different types of pay discrimination.
________________________________________
What Did the Study Do?

Willem Liebenberg set out to make sense of the confusion by:

• Defining what should be counted as “pay” (e.g. salary, benefits, bonuses).
• Suggesting improvements to how job levels are classified (moving from 6 to 7 levels).
• Proposing a statistical method—exponential regression analysis—to help companies and regulators measure whether pay gaps are fair.
• Identifying “outlier” employees whose pay is unusually high or low, which may point to discrimination.
________________________________________
What’s the Big Idea?

The study creates a practical framework for companies and the ECC (Employment Conditions Commission) to:
• Assess pay fairness across job levels.
• Spot and fix problems before they become legal issues.
• Ensure compliance with the law (sections 6, 21, and 27 of the EEA).
• Use pay data to make better HR decisions (hiring, promotions, salary benchmarking, union negotiations).
________________________________________
Why Does It Matter?

• Helps make labour laws clearer and more useful.
• Gives companies a tool to manage pay more fairly and strategically.
• Encourages a culture of proactive fairness, not just legal compliance.
• Opens the door for better data-driven decisions in HR.
________________________________________
Next Steps?

The model works on simulated data, but Liebenberg calls for:
• Real-world testing in actual organisations.
• Development of benchmarks and standards so everyone knows what “fair” looks like.

Simplified summary, designed for clarity and clean presentation:

📘 TITLE:
Fair Pay Across Job Levels
A Summary of Willem Albertus Liebenberg’s Master’s Thesis (2023)
📍 UNIVERSITY:
Stellenbosch University – Faculty of Economic and Management Sciences
🎓 Degree: Master of Commerce
📅 Date: June 2023

⚖️ What’s the Problem?

South Africa’s Employment Equity Act (EEA) of 1998 requires employers to:

1. Ensure equal pay for work of equal value.
2. Eliminate unfair income gaps between job levels.
But the law and reporting forms don’t clearly explain what counts as “unfair” or “disproportional” pay differences. This makes it hard to track or fix.

🛠️ What Did the Study Do?

This thesis:

• Clarifies what counts as income (e.g., salary, benefits, bonuses).
• Suggests improving the current job level system (moving from 6 to 7 levels).
• Proposes a new statistical method—exponential regression—to check whether pay is fairly distributed across job levels.
• Offers tools to spot unfair outliers, i.e., employees paid unusually more or less than others at the same level.

💡 What’s the Big Idea?

Liebenberg proposes a full framework for:

• Measuring whether pay differences are proportional and fair.
• Giving the Employment Conditions Commission (ECC) clear tools to assess companies.
• Helping employers take proactive steps to stay compliant with the law.
• Improving HR practices like salary planning, recruitment, performance rewards, and union talks.

🚀 Why Does It Matter?

This research:

• Makes the EEA’s pay rules easier to apply.
• Encourages fairer workplaces and stronger labour rights.
• Equips employers with strategic HR tools that go beyond legal compliance.
• Helps turn remuneration data into meaningful decisions.

🔍 What’s Next?

• The method was tested on simulated data—real-world testing is needed.
• Liebenberg recommends developing norms and standards so companies know when their pay structures are “off balance”.