Retrenchment

retrenchment
retrenchment

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. 

You may be familiar with terms such as mass redundancies or job loss but until it happens to you, there is no way of truly understanding the difficult challenge facing many South Africans today. Here are some tips for getting back on your feet when unemployment knocks you down.

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.


The rate of retrenchments in the South African economy has more than doubled over the last year. This is according to Professor Haroon Bhorat from the School of Economics and Development Policy Research Unit at the University of Cape Town who highlighted the consequences of the global economic recession.

50 million people globally will lose jobs this year - 200 000 could be retrenched in SA - but job cuts could impede economic recovery. The biggest reason is, according to a University of Washington Professor, "intellectual capital is the only source of competitive advantage within a growing number of industries.' And retrenching that capital should not be a decision made lightly.

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.

Is your company contemplating reduction of staff to reduce overhead costs? If so, this is something that you probably haven?t handled for many years. Have you updated yourself on the changes to the Labour Relations Act which came into effect in 2002? We highlight some of the main points. Two cases illustrate the points and we contrast these with a well known older case.

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