This morning, it was reported in the media that ProductivitySA has called for Section 189 of the Labour Relations Act (LRA) to be amended. This section – which sets out the guidelines for retrenchment procedures – currently limits the parties who must be consulted to:

  • People who must be consulted with in terms of a collective agreement,
  • A workplace forum and/or trade union,
  • The employee themselves or their representatives.

Productivity SA’s CEO, Mothunye Mothiba, has called for the LRA to be amended to insert a clause requiring all businesses to report their retrenchment plans to the Department of Labour before any action is taken.

What is the current Section 189 procedure?

The current retrenchment procedure, as outlined by the Department of Labour, starts off with a consultation process. The employer must consult with the above-mentioned individuals in writing.

The first thing that must be discussed is how to avoid a retrenchment. The goal here is to let as many employees, as possible, keep their jobs. However, if this is not possible, see how you can minimise retrenchments.

Other items that you need to discuss during the preliminary consultation process are, for example, the possibility of:

  • Changing the timing of retrenchments, and
  • Reducing the effect of retrenchments

It is extremely important that you, as the employer, give your employees written notice about the following if you are intending to carry out retrenchments:

  • Why you are intending to proceed with retrenchments,
  • Why you’ve decided to follow a specific retrenchment method,
  • How many people you employ and how many you are intending to retrench,
  • How many employees you’ve retrenched in the last 12 months,
  • What assistance you intend to give the employees you retrench, as well as
  • Possible re-employment.

If you want to keep up to date with the latest HR, IR and labour law news, be sure to subscribe to the Global Business Newsletter. Follow this link to register.