Retrenchment During Covid-19 Upheld In Labour Court Ruling

In the matter of De Weijer v Babcock Africa Services (Pty) Ltd (JS195/21) [2025] ZALCJHB 193 (19 May 2025) Labour Court considered the matter in which the employee was retrenched during the COVID-19 crisis.

The employee joined the company in 2007 on a fixed-term contract which later became permanent. After the company’s Central Flying Academy closed in 2013, it created a property manager role for him, largely to retain his employment. He remained in that position until October 2020, when the employer initiated retrenchments under section 189 of the Labour Relations Act.

The company argued that the COVID-19 pandemic had devastated its sales and servicing of Volvo earthmoving equipment across Southern Africa, with lockdowns halting operations. Consultation meetings were held between July and October 2020, and the employee was eventually retrenched with notice and severance pay.

The employee challenged the dismissal, alleging both substantive and procedural unfairness. He argued that his position was not genuinely redundant, that he should have been considered for alternative posts or “bumped” into other employees’ positions, and that the employer failed to provide adequate financial information during consultations. He also contended that the retrenchment was presented to him as a fait accompli.

The employer countered that the property manager role existed solely to accommodate him after the flying academy’s closure, and by 2020 its functions had dwindled to the point where they could be absorbed by other managers. The company also insisted there were no vacancies at the time and that bumping was impractical, given the specialised skills required in other roles.

On substantive fairness, the Court accepted that the COVID-19 pandemic caused a severe downturn in the employer’s mining-related sales and services. At one point, only a single machine was sold in an entire month. Given the prevailing economic conditions, the Court found there was a genuine operational need to cut costs. It further held that the employee’s position was redundant and had since been removed from the company’s structure, even though some of his functions were redistributed.

The Court rejected his argument on alternative positions, noting that vacancies were frozen and that he lacked the technical skills for posts such as national technical manager or regional export manager. The attempt to claim bumping rights over less experienced colleagues also failed, as he could not demonstrate the ability to perform their roles.

On procedural fairness, the Court found that the employer did provide financial information sufficient for consultation purposes. While the employee wanted more detailed accounts, this was viewed as unnecessary for meaningful engagement under section 189. Four consultation meetings were held, and his proposals were considered, even if not accepted.

The Court ruled that the employee’s dismissal was substantively and procedurally fair. His claim for compensation and additional severance was dismissed, confirming that the employer’s retrenchment process complied with the Labour Relations Act.

The Annual Employment Conference #AEC2026 brings together South Africa’s leading labour, HR, and employment-relations experts for a deep dive into the most urgent challenges facing employers in a changing world of work.

2026's conference promises to unpack the economic, technological, and legislative forces reshaping the workplace, offering practical insights on navigating organisational change, managing workforce risks, strengthening compliance, and preparing for the next wave of policy reform. Delegates will gain forward-looking guidance from top practitioners, case-based analysis of emerging employment trends, and strategic tools to build resilient, future-ready workplaces. Register now: https://www.globalbusiness.co.za/gbs-event-details/annual-employment-conference-2026

View our upcoming events: Upcoming Events and Qualifications, like AI Compass Capacitation Programme 2026, From Parental Leave to AI: Your 2026 HR Playbook, Annual Employment Conference 2026 (#AEC2026), Higher Occupational Certificate: HRM Administrator NQF5, Advanced Occupational Certificate: HRM Officer (NQF 6), and Advanced Occupational Certificate: HRM Officer (NQF 6).

*All workshops are offered as customised in-house training that can be presented virtually or on-site.

"Global Business Solutions (GBS)—Your Partner in Strategic HR Compliance"