Retrenchment in a time of crisis: It’s all about relationships
My business is struggling. Can I retrench staff?
But isn’t it a complicated, time-consuming process?
It does take time, but it’s not complicated
Part of the process will depend on the size of the organisation and the number of affected employees, but it is not in itself complicated. It’s all about fair and open consultation.
During a recent Cliffe Dekker Hofmeyr presentation, Fiona Leppan explained that, if the Labour Court finds that the employer has failed to follow procedures and consult fairly, there are four remedies (s. 189A (13) of the Labour Relations Act)
The first three require the court to send the employer back to consultation and the required procedures. This delays the process, and employees will have to be paid for longer than planned.
If, however, the relationship between the parties is so flawed that further consultation is unlikely to succeed, the fourth option is to award compensation. That may be up to 12 month’s pay per employee — more expense.
Follow the procedures. Consult openly and honestly.
But, more important, make open, honest and regular communication, part of your organisation’s DNA. Then, even retrenchment may be negotiated relatively calmly and cleanly.
- Listen to the challenges
If employees know you will listen to them, they are more likely to hear you out when times are tough.
- Talk about issues
Don’t wait for the wheels to fall off before you take staff into your confidence.
- Ask for suggestions
Why work with only one brain when you have a team that will have a different perspective.
How have you kept communication channels open?
I would love to hear from you