There are a number of reasons why an employer might find a mutually agreed termination more time effective or efficient than other disciplinary procedures. However, the employer should be very careful not to confuse a retrenchment situation - with very specific procedural requirements - and a genuine mutually agreed termination of the employment relationship. Importantly, such an end of the contract is not legally classed as a dismissal. Ivan Israelstam explains.
This week Ivan Israelstam explains the differences between a retrenchment (an operational requirements dismissal) and a mutually agreed termination of an employment contract. The procedures to be followed are different and the nature of the document that concludes the ending of the employment contract are significantly different. Mixing up these two types of agreement can be expensive.