South Africa has asked the court to fine Huawei Technologies’ domestic unit for violating its employment laws and for ordering the company to amend its operations, the Department of Labor said on Friday. About 90 percent of the company’s employees were outsiders, violating “employment equity” laws that set a 40 percent limit, the department said, citing a 2020 survey.
The department said it had filed court papers seeking a fine of ZAR 1.5 million (approximately Rs. 75,00,100) or 2 percent of the company’s 2020 annual profits for alleged violations.
“We are asking the esteemed court to issue an order for them to apply the employment equity plan which will address the situation,” Labor spokesman Fikiswa Mncanca-Bede told Reuters by telephone.
In a statement, Huawei South Africa said it was “committed to continuing to negotiate with the Department about our equity plan. Huawei is committed to complying with local laws and regulations. ”
The department said Huawei had been granted compliance with the provisions of the Immigration Act which required it to employ 60% of South Africans and 40 percent of foreign nationals.
It said Huawei had instead hired more than that of foreign workers and had plans to hire more.
“The department has decided that the cause is clear and that all charges have been filed,” he said.
The move is the first time the South African government has filed a lawsuit against China’s largest technology company, facing US sanctions for allegedly using corporate tools to be used by the Chinese government to spy on them.
Huawei and Beijing have repeatedly denied the allegations.
However, the Department of Labor has filed a lawsuit against a small Chinese company over allegations of maladministration and human trafficking in its Johannesburg factory. The case is still in court.
Huawei is one of the largest players in information and communication technology in South Africa, selling a wide range of products from mobile phones, smart devices, televisions and telecommunications solutions to cloud computing and data storage.
It has not yet been made public about the number of people it employs in South Africa.
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