In South Africa, the retrenchment process is governed by the Labour Relations Act, ensuring that dismissals due to operational requirements are fair. Determining who is retrenched first involves a consultative process where employers must engage with trade unions, workplace forums, or the employees directly.
During these consultations, efforts are made to reach consensus on various topics such as avoiding dismissals, minimising the number of affected employees, the timing, and methods for mitigating the effects of retrenchment. Employers must provide comprehensive information including the reasons for retrenchment, selection methods, and severance pay details.
When it comes to selecting employees for retrenchment, criteria should be fair and objective. Commonly, the ‘Last in, First out’ (LIFO) principle is applied, but considerations may include the employee’s skills and performance.
Retrenched employees are entitled to a severance package based on completed years of service, outstanding leave, notice pay, and other contractual benefits. If the retrenchment process is disputed, employees have the right to refer the matter to the CCMA under specified conditions.
For expert legal advice on navigating the complexities of retrenchment, contact Burger Huyser Attorneys. Our specialised labour attorneys are here to support and guide both employers and employees through this difficult process.
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