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Labour Relations Act, 1995 (Act No. 66 of 1995)

Notices

Bargaining Council for the Metal and Engineering Industries

Main Collective Agreement

Part 2

5. Annexure A

Security of Employment and Severance Pay

1. Retrenchments and/or Redundancies

2. Procedure A

 

2.1        Notice of proposed retrenchment

 

2.1.1 An employer must notify all relevant consulting parties and the Regional Bargaining Council when that employer contemplates terminating the employment of one or more employees for reasons related to its operational requirements.
2.1.2 Consulting parties include any registered trade union of which any of the employees potentially affected by the proposed retrenchment are members, and the nominated representatives of any potentially affected employees who are not members of a registered trade union.
2.1.3 The notice referred to in 2.1.1 must be given in writing, as soon as possible after retrenchment is contemplated but at least 21 days before the contemplated date of retrenchment.
2.1.4 In the written notice, the employer must invite the consulting parties to commence consultations over the proposed retrenchment. At the same time, the employer must disclose all relevant information to the consulting parties. This information must include, but is not limited to the following:
2.1.4.1 The reasons for the proposed retrenchment;
2.1.4.2 The alternatives that the employer considered before proposing the retrenchment, and the reasons for rejecting these alternatives;
2.1.4.3 The number of employees likely to be affected and the job categories in which they are employed;
2.1.4.4 The proposed selection criteria to be used to determine which employees to retrench;
2.1.4.5 The proposed date of retrenchment;
2.1.4.6 The proposed severance pay;
2.1.4.7 Any assistance which the employer proposes to offer to the employees who are likely to be retrenched;
2.1.4.8 The possibility of the future re-employment of the retrenched employees;
2.1.4.9 The number of employees employed by the employer; and
2.1.4.10 The number of employees that the employer has dismissed for reasons based on its operational requirements in the preceeding twelve-month period.

 

2.2        Consultation Process

 

2.2.1 The employer must engage in a meaningful joint consensus-seeking process with the appropriate consulting party, and attempt to reach consensus on:

2.2.1.1        Appropriate measures to:

▪ Avoid the  retrenchment;
▪ Minimise the number of retrenchments;
▪ Change the  timing of the retrenchment; and
▪ Mitigate  the adverse effects of the retrenchment;
2.2.1.2 The method for selecting the employees to be dismissed; and
2.2.1.3 The severance pay for dismissed employees.
2.2.2 The employer must allow the consulting parties an opportunity to make representations about any of the above matters, and any other issues relevant to the proposed retrenchment.
2.2.3 The employer must consider and respond to any representations made and, if the employer does not agree with them, it must state the reasons for disagreeing. If the consulting party’s representations are made in writing, then the employer must respond in writing.
2.2.4 In any dispute in which an arbitrator is required to decide whether or not any information sought by the consulting parties is relevant, the onus is on the employer to prove that the information which it has refused to disclose is not relevant for the purposes for which it is sought.
2.2.5 The employer must select the employees to be dismissed according to selection criteria:
▪ That have been agreed by the consulting parties; or
▪ If no criteria have been agreed, criteria that are fair and objective.

 

2.3        Severance Pay

 

The formula contained in clause 35 of this Agreement must be used to determine the amount of severance pay to be paid to a retrenched employee.

 

2.4        Notification of termination of employment

 

When the consultation process has been concluded, the employer must give notice of termination to those employees selected for retrenchment on the following basis:

 

▪ One week, if the employee has been employed for six months or less; or
▪ Two weeks, if the employee has been employed for more than six months but less than twelve  months.
▪ Four weeks, if the employee has been employed for twelve months and more.

 

2.5        Notification to the Bargaining Council

 

2.5.1 Once the affected employees have been given notice of the termination of their employment, the employer must inform the bargaining council’s Regional Office, in writing, of the number and occupational categories of the employees that have been retrenched.

 

2.6        Re-employment of retrenched employees

 

2.6.1 If an employer who has previously retrenched employees engages new employees, that employer must, as far as is practicable, give preference to the re-engagement of those persons who were retrenched from the establishment and who are qualified and available to undertake the categories of work required by the employer.

[Substituted by Government Notice R. 268 of 12 April 2013]