Retrenchment

The Labour Relations Act (LRA) makes it obligatory for employers that are contemplating retrenchments to first consult about this prospect before making any decision to retrench. Where the relevant employees belong to a trade union the employer is required to consult with that union on a number of issues, the most important of which is any means of avoiding job losses.

Following the global recession, another local recession may be headed our way. It could not come at the worst time for South Africa’s economic recovery after Covid and as we struggle with political uncertainty and a failed electrical grid.

In this era of downsizing and mergers, job loss is something we all fear. If you find yourself waiting for news regarding your employment status, try to avoid conjecture.

Retrenchment consultations are potentially emotional and difficult discussions. This week Ivan Israelstam explains whether employees involved in a retrenchment consultation have a right to bring in a lawyer or other external labour law representative. 

Updated legislation makes it harder for employers to retrench employees. Employees now have the choice of going to court or of going on strike in order to challenge retrenchments, but the effect of a strike could further weaken the employer?s finances and necessitate further retrenchments. Ivan Israelstam explains the factors to consider.

Are you doing enough to avoid retrenchments in your company? Or do you still see retrenchments as the only way to reduce costs? Some thoughts on alternative routes to cost reduction and achieving a more efficient organisation.