Category lra forms sub category ccma document type forms filename retrenchment ccma. Effects of retrenchment on organizational performance at. Introduction retrenchment is the process by which staff is reduced to cull redundant employees and reduce the wage bill. The reason retrenchment cover is not widely offered can be summed up in a word insurers dread. Retrenchment and transfer of businesses description a publication detailing the aspects of retrenchment and the transfer of business and the requirements of the lra in terms of section 189 and 197. If you are leaving the company, you may wish to preserve your fund benefit. On to the issue of retrenchment, the federal court confirmed the industrial courts decision in holding that the closure of business was perfectly legal and proper. However, for commercial reasons or as a result of poor economic conditions andor financial performance, downsizing numbers is sometimes the only recourse. Modimolle recognizes the need to provide all employees with security of employment as far as possible. Procedure of retrenchment section 25g lays down the procedure of retrenchment. Your guide to labour law in south africa labour guide. An analysis with special reference to india by kaushik basu, gary s. A retrenchment procedure is carried out when the company has squandered a vast amount of money into something irretrievable. Sample format 8 retrenchment letter template south africa excel word pdf doc xls blank tips.
Employee can initiate request for voluntary retrenchment or early retirement but it is the municipal managers prerogative whether or not to approve the. Growth or retrenchment strategy choices for declining entrepreneurial firms. The 60 day period in any large scale retrenchment commences once a notice in terms of s1893 has been issued. This article, therefore, spells out what employers may do and must do when they contemplate retrenchments.
These include giving you at least 2 weeks notice and paying your redundancy payment on the date of dismissal. Retrenchment strategy advantages and disadvantages wisestep. However, the key to a good outcome lies in developing and implementing a retrenchment procedure that achieves the commercial gains of the process while minimizing the impact of job losses on workers and communities. Aug 29, 2011 conditions precedent to retrenchment of workmen pdf download. Retrenchment under industrial dispute act, 1947 this article tells about the legal aspect related to retrenchment and deals with the procedure for calculation of retrenchment compensation. Retrenchment and transfer of businesses pdf labour smart. Retrenchment ccma, document, labour law, south africa, pdf. Government retrenchment and citizen participation in. After having an income protection policy in place for six months, you qualify for the retrenchment benefit, and you wont be covered for any retrenchment process that begins within these six months. Dec 20, 2007 dear all, kindly help or send me the format of retrenchment letter. Telkom kenya tkl started retrenching in may 2006 in preparation for privatization.
If a collegewide problem exists, the department or major administrative division will be the retrenchment unit. Where any workman in an industrial establishment, who is a citizen of india, is to be retrenched and he belongs to a particular category of workmen in that establishment, in the absence of any agreement between the employer and the workman in this behalf, the. Maggie gunning was a major contributor in the development of intelligent spas spa operations manuals, providing valuable practical insight into the many procedures and work flows to achieve high quality, international standard resources, designed to enable spas to effectively implement the knowledge. Employees who are obligatory retrenchment shall not be liable to repay the relocation and education loans. Wherethe workman was engaged on casual basis without a written service contract or letter of appointmentfor doing a particular urgent workhis service, automatically came to an end when the work was over and there was no retrenchment. Thank u and look forward for your valuable guidance. Use the retrenchment policy and documents should you need to institute retrenchment procedures. Such pressure has compelled governments to conduct substantial cuts in government spending and services. Conditions precedent to retrenchment of workmen pdf download. Retrenchment may sometimes be a necessary part of securing future employment for large sections of the workforce. This is the tendency for people to take out insurance only when the probability of. Free employment documentation for namibia hr documents. The greatest number of cases that employers lose at the ccma in south africa arise because the employer failed to follow the legislated retrenchment procedure.
Rights and retrenchment is a scholarly lightning bolt, mixing rigorous empiricism and close, institutionlevel analysis of civil rulemaking in a field that has too often lacked either. Anybody can help me to provide retrenchment policy and retrenchment calculation model for both workmen and executives thro my email id. Despite the fact that the retrenchment procedure is clearly spelt out, employers are still being caught out at the ccma and in the labour court for failing to follow procedure. Retrenchment process and procedure quicklaw guide legalwise. There are also various procedures when selecting people for redundancy, alternative work and time off. In other words it lays down what actions should be performed. For example, in the case of numsa and others v dorbyl ltd and another 2004, 9 bllr 914 176 employees embarked on a protected strike. Retrenchment business essays essay sauce free student. Retrenchment ccma description information sheet by the ccma on retrenchment consultation must take place as soon as the employer contemplates retrenchment. Occupational health and safety act 85 of 1993 as amended ohsa basic conditions of employment amendment act 7 of 2018.
Retrenchment, as commonly understood is termination of an employee on the grounds of surplus labour or incapacity of employees due to some economic grounds. While policy makers have attempted to build a strong civil society to compensate for the declining government role, previous studies have not examined the link between government retrenchment and citizen involvement in volunteering. Resignation, retrenchment, dismissal preserving your fund benefit when you leave the company not only provides a huge tax benefit, but is also essential to ensure sufficient provision for your retirement. Retrenchment and restructuring labour and community. Retrenchment shall not be used for the purposes of victimization of any employee. In a nutshell, the retrenchment process to follow is to. Ensure the retrenchment policy is available to all staff. In addition to the provisions in the legislation as regards collective redundancies your employer must follow certain fair procedures. The methodology used in this research is a pure legal. Proper retrenchment procedure is essential formfactory. For the staff member who complete his probation period, but management does not want to continue his service. Application the labour relations act applies to all employers, workers, trade unions and employers organisations, but does not apply to o members of the. The employer must also prove that heshe has shared with the targeted employees or their representatives all documentary and other information pertinent to the retrenchment.
Its an instant classic in explaining how we got to the present while also charting a new path forward for procedure scholars. An employer must consult not only on the consequences of the proposed retrenchment but in respect of the business needs and to be able to show that all reasonable alternatives have been considered prior to contemplating the need for retrenchment. The retrenchment unit will vary according to the nature of the financial problem or reduced need. A strategy used by corporations to reduce the diversity or the overall size of the operations of the company. This strategy is often used in order to cut expenses with. Category employment conditions sub category transfer of business document type publication filename retrenchment and transfer of businesses pub. Introduction changes in the scope of the company activities resulting from technological changes, economic factors, restructuring reorganisation and operational rationalisation are often accompanied by changing staffing requirements. By end of 2010, a total of 501 employees had been retrenched at eldoret telkom. May 24, 2017 the section 189 retrenchment process in terms of the labour relations act section 189 of the labour relations act lra permits employers to dismiss employees for operational requirements. Organizational ecologists theorize an inevitable progression from growth through maturity, revival, and eventually decline. Members have the option to convert or continue their death cover.
These templates can be used to assist with the practical management of creating new documents. Templates are provided to assist the hr professional, managers and unions with documents on various labour and employment law topics, such as disciplinary hearings, arbitrations in the ccma, retrenchments, employment equity and other topics. If an employer gives notice of retrenchment before the above periods have elapsed, workers may give notice to strike. Having termination policies and procedures can help the management and the human resource department assess situations where termination is considered as the best option to execute. Compensation for injury and occupational diseases act of 1993 coida constitution of the republic of south africa 1996. In the event an employer decides to retrench an employee, employees and or a group of employees, the employer is required to do the following. If your business employs staff, this retrenchment policy can be used to address the risk of retrenchments in the organisation. Despite many things that can be said against retrenchment, it does handle the immediate problems very effectively. If facilitation fails the employer may not give a notice of dismissal for minimum of.
Why create an online policies and procedures system. The client will implement a procedure which provides individuals with the right to challenge their selection. Advantages and disadvantages of retrenchment strategy. The retrenchment procedure as laid down in the labour relations act lra must be followed properly and in good faith by the employer.
However, the industrial dispute act, 1947 the id act is the governing legislation for retrenchment, which takes the wider view of termination of employee as against the. Retrenchment page 3 retrenchment is an unfortunate but necessary process to increase profits or limit losses, which leads to reducing its employees, but there are alternatives and the labour relations act requires the organisation to consider suitable measures to avoid retrenchment and minimise the number of dismissals. Consultation must take place with a workplace forum. This paper examines the effect of retrenchment on organizational performance based on a study conducted at the telkom kenya, eldoret branch over a 5 year period. When do we start calculating the 60 day consultation period. Retrenchment in india, industrial dispute act, 1947. However, if the problem occurs within a department, then the discipline may become the retrenchment unit. Give notice of any intention to retrench as soon as it is contemplated. These are defined as requirements based on economic, technological, structural or similar needs of the employer. A quick guide to retrenchment tanzania introduction. Ebrd retrenchment guidance april 2010 retrenchment and restructuring labour and community issues, a brief guide ebrd requirements on redundancy. In early 2014, the employer, respondent underwent a restructuring exercise and the applicant.
Disclose all relevant information on the intended retrenchment for the purpose of proper consultation. Effects of retrenchment on organizational performance at the. Jul 05, 2019 however, the designing and implementation of its retrenchment policy has been strongly criticized by public issue of debate in the parliament and protested by employees agitation by employees. The retrenchment policy helps to set out details such as the retrenchment procedure and the consultation process. If your business employs staff it is recommended that the company implement procedures and forms to. Spa operating procedures and policies manual intelligent. Referral to labour court if an employers retrenchment procedure is unfair, a consulting party may apply to the labour court, within 30 days after the employers notice, to order the employer to o comply with a fair procedure. Impact of the retrenchment on the company there are some negative results of retrenchment in company and also on the employee relationship.
Retrenchment and restructuring labour and community issues. We have listed several termination policies and procedure examples so you can identify the details that you can also incorporate in your own business policy and procedures for termination. Where a position is identified as surplus to requirements, the municipality shall make every effort to provide alternative employment opportunities at a similar classification level and salary, having regard to qualifications and experience. This paper will present an analysis of largescale retrenchment facilitation arguing that the codified facilitation procedures will give true meaning to the constructive engagement implicit in the retrenchment process i. This policy aims to minimize retrenchment by ensuring a fair redundancy process. Employment contracts, employee forms, benefit forms, labour act. These are defined as requirements based on economic. Consultation must take place as soon as the employer contemplates retrenchment. The employer must give fair reasons for making the decision to retrench and follow a fair procedure when making such a decision. Where retrenchment plans are required by law clients should ensure that the retrenchment plan is in line with regulatory requirements. Procedure for calculation of retrenchment compensation while effecting retrenchment of the workmen, it is obligatory on the part of the employer to pay retrenchment compensation at the rate of 15 days wages for every completed yaer to be calculated at the last drawn salary of an employee. The industrial disputes id act, 1947, which was the first legislation on exit.