South Africa is now entering a ‘retrenchment season’ as it grapples with the impact of the coronavirus lockdown, says law firm Cliffe Dekker Hofmeyr.<\/p>\n
Speaking in a virtual seminar on Wednesday (8 July), Thabang Rapuleng, a director at Cliffe Dekker Hofmeyr said that large-scale retrenchments have become the ‘order of the day’\u00a0 for many of the country’s businesses.<\/p>\n
He noted that these retrenchments are regulated by S189 of the Labour Relations Act (LRA) and\u00a0envisage a consultation period of 60 days.<\/p>\n
However, he noted that the timing of the retrenchment differs on whether a facilitator is appointed and that an employer may retrench after only 30 days where a facilitator has not been appointed.<\/p>\n
Rapuleng said that some of the key issues that arise around these retrenchments, especially during the Covid-19 pandemic, are the following:<\/p>\n
When is an employer allowed to introduce voluntary severance packages?\u00a0<\/strong><\/p>\n Rapuleng cited the recent case of SACU vs Telkom<\/a> <\/strong>which dealt with an employer who introduced a voluntary severance package before a S189 (3) consultation process.<\/p>\n The issue was referred to the Labour Court which held that:<\/p>\n “Even if a party has reservations about whether there is a need for retrenchment, it must be prepared to engage in consultations on alternatives.<\/p>\n “Nothing prevents a party from engaging on a provisional basis, by making it clear upfront that its consent to the adoption of certain alternative measures is subject to it being persuaded that retrenchment would otherwise be required.”<\/p><\/blockquote>\n “Essentially the court held that there was nothing untoward with the employers conduct and this case now means that the employer may offer voluntary severance packages even before initiating a S189 (3) process<\/strong>,” explained Rapuleng.<\/p>\n What if an employer has fallen on hard times?<\/strong><\/p>\n The second case deals with an employer who has already fallen on hard times and cannot pay salaries either before or while the facilitation process is pending.<\/p>\n
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