Businesses are known for restructuring which may be due to various factors such as the economic climate, advancements in technology, etc. Section 189 of the Labour Relations Act 66 of 1995 allows employers to dismiss employees based on operational requirements. These operational requirements may be for economic, technological, structural, or similar needs. This process may not be used as a workaround where employers are attempting to dismiss employees due to poor work performance or for various other reasons. Before proceeding with retrenchments, employers are required to discuss the potential retrenchments with the employees to brainstorm and determine if there is a possible alternative to such retrenchment. This article shall set out the process known as joint consensus-seeking consultation and what is required for it to be deemed fair and lawful.
The Labour Relations Act has set out specific requirements which must be adhered to for retrenchments as a result of operational requirements to be deemed lawful. The first of such requirements is that employers and employees must enter into a consultation process in which the possible retrenchment is discussed, and alternatives thereto are proposed by both parties. This process is known as a meaningful joint consensus-seeking process. This is where retrenchment may only be contemplated, and it is not a definite outcome. If the employer goes into this process in the mindset where retrenchment is already the only outcome such consultation would not achieve any productive outcome. Nor would this process be deemed by the law to be successfully complied with.
The joint consensus-seeking process does not require consensus to be reached, it only requires both parties to put in their best effort to find the middle ground to avoid retrenchments. Various topics must be discussed during this consultation. The first of which is that the employer must set out a detailed explanation to employees on the reasons for the proposed retrenchments. Once the employees understand the circumstances in which the employer is required to contemplate the retrenchments, the process shall commence whereby the employees may make suggestions to the employer on how to mitigate such retrenchments. These mitigating factors may deal with manners in which dismissals may be avoided or ideas in which the number of dismissals may be mitigated. Discussions regarding the timing of dismissals may occur as well as other mechanisms which may be introduced to mitigate the adverse effects of retrenchments. Here it is quite common for employees to suggest that they no longer work overtime or that they be given a few extra months in which to find alternative employment. In certain circumstances, this process may be successful, but it is entirely possible it is not and the employer proceeds with retrenchment.
Should you require any assistance in ensuring your compliance with Section 189 requirements or have any labour-related queries, contact us and we shall gladly assist.