South Africa has possibly the most liberal labour laws in the World and Employers cannot just retrench staff without due process. There will be times that a company will simply stop operating because it no longer has the funds to operate and staff will find themselves without work with no warning whatsoever. However, it most cases staff will be given adequate advance warning of pending retrenchments.
The South African Labour Department have put out a Guide to Retrenchment that states quite clearly the steps that have to be stake in the event of possible retrenchment.
No matter how much warning you get, no matter how much you are compensated, Retrenchment is stressful and will effect you and your family. No matter how good you are at your job, what position you held in the company – losing your job will cause you untold stress that could lead to health problems. People begin to feel useless, especially when the search for a job drags on.
So what can you do if you find out, you may be retrenched? The most obvious step, is to ask management, if you have a good relationship with management, you should get a straight answer. However, you need to remember that then most important person in this equation is You! Read through your contract, and start looking for alternative employment. Of course, if you have enough money put aside to survive for a while whilst looking for work, you may decide to ride it out. Of course you could also use your savings to survive whilst you start your own business.
As employee you will have received certain deductions from your salary, such as PAYE, UIF, Pension and Medical – if you have been paying Pension, you are entitled to it back (normally you would transfer to your new employers pension scheme or to a private pension scheme). You are also entitled to severance pay;
On retrenchment, an employer must pay the retrenched worker certain benefits. An employer must pay a minimum severance pay of one week’s wages for each completed year of service to all retrenched workers, no matter what other benefits might be due to them. Ensure that you get all the financial benefits, that are due to you. In most cases, in addition to severance pay you should receive your pension money, money for leave you have not taken and part of your bonus. Discuss the financial benefits you will receive, with your worker representative and the Personnel Division of the company you worked for.
The very first thing you do if you get retrenched, is go to to the Department of Labour and register for UIF, at the same time discuss with them the circumstances of your retrenchment. Next start using your contacts to find work and visit several recruitment Agencies. Next go online and register with the online recruitment agencies.
This not a time to procrastinate – get stuck in immediately, other wise some one else will beat you to the job.