SA’s economic turbulence has resulted in retrenchments becoming a common practice. Of late, Telkom retrenched over 1000 employees as part of its restructuring exercise.
The onus is on the Employer to ensure that it follows the operational requirements for a fair dismissal in terms of a retrenchment. The Employer must provide a legitimate and lawful reason for the retrenchment. In addition, the process of choosing which employees will be retrenched, must be fair. The correct retrenchment procedure is in terms of the Labour Relations Act and it involves amongst other things, consultations with the affected employees.
In the case of Enterprise Foods (Pty) Ltd v Allen & Others, the Court found that the 733 employees had not been properly consulted and the decision to close the plant was taken prior to the retrenchment process. The retrenchments were therefore procedurally unfair and each of the affected employees were awarded 12 months’ remuneration!
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