Labour Relations Act, 1995 (Act No. 66 of 1995)NoticesNational Bargaining Council of SA Leather IndustryGeneral Goods and Handbag SectionCollective Agreement21. Retrenchment Procedure |
| (1) | Notification to union(s) |
An employer who intends to reduce his employee requirements due to operational requirements must notify the union(s) concerned of the number of employees and reasons therefor at least 4 weeks prior to implementation.
| (2) | Consultation with Unions |
The company and union must meet within 5 working days of the union’s receipt of notification to explore alternatives to retrenchments, such as working short-time, limiting overtime, transfer of individual employees to other operations, voluntary early retirement and/or other practical alternatives the parties may agree upon.
| (3) | Selection Criteria |
Should the parties be unable to reach an agreeable alternative to retrenchment, the company must supply the union(s) with the following information:
| (a) | names, and length of employment with the company and occupation of the employees; |
| (b) | the method implemented for selecting employees for retrenchment (LIFO principle or any alternative agreed principle). |
| (4) | Notification to employees affected |
Employees affected by retrenchment must be given one week=s notice of retrenchment or alternatively, one week=s pay in lieu of notice.
| (5) | Severance Pay |
The union(s) may negotiate severance pay with the employer.
| (6) | Re-engagement of retrenched employees |
In the event of the employer requiring increasing his labour compliment, retrenched employees must be given first option for the vacancies which are required to be filled.