Solve all your retrenchment problems now!

Planning a retrenchment? Watch out…

Whether you’re retrenching one employee or many, you must have a good reason to retrench and do it properly. Otherwise you’ll end up defending yourself in court, which'll cost you time and money. You could end up even worse-off than you were before you retrenched!

Which of these questions do you need answered?

  • When can I retrench staff?
  • What must I think about before I start retrenching?
  • What must I include in my Section 189(3) notice?
  • What must I include in my retrenchment letter?
  • How do I calculate severance pay?

You can’t just retrench your staff. You need to consult with the potential retrenches or their representatives. You must issue a written notice inviting then to consult. This notice is called a Section 189(3) notice. We’ve included a sample of this notice in your copy of the Labour Law for Managers Practical Handbook.

Checklist: Include these 11 items in your Section 189(3) notice

  • The reasons for the proposed retrenchments
  • The alternatives you considered before proposing retrenchment, and the reasons for rejecting each alternative.
  • The number of employees likely to be affected and job categories in which they’re employed.
  • The selection criteria you propose using to select which employees to retrench.
  • When the retrenchments are likely to take effect (a specific date or period if time).

There are six additional items to include in your notice. They’re vital to know and you can find them in section R03 of your Labour Law for Managers Practical Handbook.


Severance pay – what are your obligations?

You have to pay at least one week’s remuneration for every completed year of continuous service.

Warning! You must calculate it on remuneration and not basic salary.

In the Labour Law for Managers Practical Handbook, we answer your questions about:

  • If you pay more than the statutory minimum must you calculate the payment on full remuneration, or can you use a different formula?
  • What if the employee worked for you previously – how does this affect length of service and severance pay?
  • And all other aspects of retrenchment

You’ll also find information on:

  • The CCMA has processed over one million disputes and employees have won more than 50%! Are you prepared?
  • Employment Contracts: What the law says you must do
  • Do you know how to legally dismiss your employee?
  • Do your employees abuse their leave?
  • Do you know one day’s absence can cost you 3 days’ salary? Start proactively dealing with absenteeism today!
  • Make sure you resolve employee grievances before they turn into major CCMA or Labour Court disputes!
  • How to make the law work for you when it comes to overtime
  • 10 Essential steps to dismissing for poor performance - have you covered all your bases?
  • Strikes can cripple your business – find out how to prevent them
  • 14 Ways to comply with employment equity