Unfair Retrenchment
Retrenchment is regulated in terms of section 189 of the Labour Relations Act 66 of 1995 (“LRA“). This section sets out procedural guidelines on how employers should go about conducting the retrenchment consultation exercise before making any final decisions about retrenchments. It is a process wherein the employer reviews the business needs, profitability and other operational factors in order to increase profits or limit losses. As a result, in most cases, this means that the business has to reduce employees.
This process is quite complex and requires “exhaustive” consultation with the affected employees or their representatives. The employer must give fair reasons for retrenching employees and follow a fair procedure when making such a decision. Thus, ensuring that they comply with the Labour Relations Act and the rights of their employees. However, if an employer doesn’t provide the proper reasons and doesn’t follow the proper procedures, the CCMA or Labour Court can consider the retrenchment unfair. Employees that have been unfairly retrenched can refer a dispute to the Commission for Conciliation, Mediation and Arbitration (“CCMA”) or a bargaining council. However, the employee must refer the dispute within 30 days from date of retrenchment. PLEASE CONTACT US FOR A FREE ASSESSMENT OF YOUR CASE,CCMA REFERRAL OF YOUR CASE AND CCMA LEGAL REPRESENTATION ON A NO WIN NO FEE BASIS.PAY US ONLY WHEN WE WIN YOUR CASE
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