The past week saw the country erupt to an unexpected turn of events. Where most employers had to deal with the destruction of property, loss of income which then ultimately affects the profitability and operation of the business as usual. This loss from the unrest resulted in lack of ability to meet set targets by directly and indirectly affected employers.

The unfortunate and sad part of all this is that the aftermath of those events could lead to companies closing down, retrenchment and the further rise of unemployment in the country as a whole.

Occupational Health and Safety Act 85 of 1993 requires employers to provide employees with a safe working environment. During the unrest many people were afraid to even walk in the streets because of violent actions. This resulted in employees being afraid to go to work.  To comply with the Occupational Health and Safety Act 85 of 1993 which narrates the responsibility of the employer to provide for the health and safety of persons at work, some employers had to close down operation to preserve their employees from possible harm as a result of the unrest.

Post-closing down due to the unrest, employers may feel the need to revert to the no work no pay rule for the days the employees missed work, it is however, important to note that the events that occurred that affected workplaces are beyond the control of the employees as much as they were for the employers. All decisions regarding the remuneration of employees must be based on the company’s policies regarding remuneration and leave administration including employees’ employment contracts. To avoid further financial losses and/or damages, employers should avoid taking action that are one-sided and far from the workplace regulations.

Due to financial reasons some employer might fail to pay salaries. This has to come with openness, consideration and complete compliance with all the regulations that govern issues that affect the workplace.

Relevant protocols have to be followed, all decisions to be taken must be legally correct decisions that are guided by the Basic Conditions of Employment Act, no. 75 of 1997 and other relevant workplace laws.  Decisions like retrenchments and salary cuts are almost inevitable for most companies at times like these, and they may be the only way to keep operating for certain employers and to also preserve jobs. During salary cuts, it is advisable for employers to look for the most suitable option from the following available options:

  • Benefits
  • Bonuses and Raises
  • Reduced Hours

There is also an of option of Short-time working– which refers to a specific temporary situation where either:

The weekly pay is less than half a normal weekly pay or the hours worked are reduced to less than half of a normal weekly working hours. This one of the strategies employers can use to recover from the losses and keep employees employed in the company. One need to be extremely careful with whatever the decision taken. Sometimes retrenchment is not the best option for the business because one stand a good chance of losing hardworking and dedicated employees to competitors. In most if not all organizations, employees are a vital part of companies’ ability to navigate the industry and successfully compete with other players.  

Employer must notify employees of the reduction in hours or pay (or both) before short-time working starts. South African Labour Laws requires parties to consult before changing the terms and conditions of employment as regulated in the employment contract.  

If retrenchment is the last and final option left it is advisable to use the LIFO (Last in First Out) principle which is a mostly acceptable selection criteria used by many organisations and trade unions, unless if parties can agree on a special selection criteria that works for both the business and employees.

Although the unrest has obviously caused confusion and uncertainty in the workplace and the county at large, it is always important to follow set procedures and regulations. Should you need assistance with correctly applying the relevant Human Resources processes, protocols and procedures, to avoid legal actions, SISOL Labour Projects can assist. Because WE CARE.

Please note that this is not a legal advise. Please contact us or your attorney for legal advise.

Contact Us: 012 225 2001


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