Davies Ndumiso Sibanda
MANY workers are being retrenched in terms of the amended labour legislation and end up losing the little offered by employers due to ignorance of the law.
The starting point is to appreciate that our retrenchment legislation favours employers and workers have very little room to manoeuvre in cases where employers are retrenching due to financial challenges.
The law provides for the employer to give written notice of intention to retrench to the Works Council and where there is no Works Council to the NEC and where the majority of the workers prefer NEC then the matter will be referred to it (NEC). Where there is no NEC parties refer to the Retrenchment Board.
While there are many technical issues related to retrenchment, workers have to appreciate that the window for negotiating a retrenchment package and retrenchment package mix is much smaller than before, in fact in most cases it is not even there.
The law now prescribes a minimum retrenchment package which is one months’ salary for every two years worked, which translates to half a month’s salary for every year worked. The challenge for workers is that they can only negotiate for the improvement of the package.
However, where the employer sticks to the minimum package, there is nothing workers can do as even the Retrenchment Board in my reading of the law cannot compel the employer to pay more than the minimum.
Provisions such as severance pay, relocation allowance and others are now a thing of the past and can only be paid if parties negotiate and agree but they are not a statutory requirement. All this leaves the employee at the mercy of the employer for any retrenchment package above the minimum.
Further, the law provides for paying nothing at all if the employer proves that he cannot afford anything at all. In such cases, my reading of the law is that even the Retrenchment Board cannot compel such an employer to pay once it makes a finding of fact that the employer is financially unsound. This makes it very important for workers to be smart when negotiating retrenchment package as a militant approach can easily harden the employer who could have given something to the workers resulting in workers walking home with nothing.
Unfortunately, retrenchment is also being used as a cheap dismissal method to get rid of “problem” employees with a short service, thus making such employees live in perpetual fear of dismissal which is an unfortunate, unintended consequence of the legislation.
In conclusion, workers need to seek expert advice so as to avoid making mistakes that are costly.
Davies Ndumiso Sibanda can be contacted on: email: [email protected] or cell No: 0772 375 235