Section 189 of the South African Labour Relations Act is the legal cornerstone that defines the process of retrenchment for operational needs. It ensures that the retrenchment is fair, both procedurally and substantially, without fault attributed to the employee.
The act requires employers to engage in a meaningful consultative process with appropriate representatives, which may include trade unions or the employees themselves, to seek consensus on avoiding dismissals and mitigating their effects.
Essential to this process is the disclosure of all relevant information by the employer, including the reasons for retrenchment, alternatives considered, the method for selecting employees for dismissal, severance pay, and any assistance provided to the affected employees.
Employers are obliged to consider any feedback or representations from the consulting parties and to respond with reasons if there is a disagreement. The selection of employees for retrenchment must be based on fair and objective criteria, often following the ‘Last in, First out’ principle.
The minimum severance package should equate to one week’s remuneration per completed year of service, along with accrued leave payout and notice pay. Additional benefits may be due based on the terms of the employment contract.
For personalised legal support in navigating a Section 189 retrenchment, contact Burger Huyser Attorneys
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