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Eskom is offering their staff voluntary retrenchment. Here's how you can do it legally if you're in the same boat

by , 02 December 2014
Eskom's in BIG trouble.

Not only is it battling to keep the lights on, but its last weeks' interim results show profits are down as well.

According to Reuters, Eskom's net profit fell by 24% to R9.3 billion in the six months to end-September. And it forecast a 93% decline in full-year net profit to R500 million.

To deal with its financial problems, Eskom is now offering its staff voluntary retrenchment.
Their employees can apply by February 2015.

But offering voluntary retrenchment isn't only for companies like Eskom, you can do it too if you need to cut costs in your company.

Here's how...

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Here's how to offer voluntary retrenchment to your employees

According to bowman.co.za, voluntary retrenchment is an alternative to forced or compulsory retrenchment. You must introduce it as part of your retrenchment consultation process on potential retrenchment.
With voluntary retrenchment, your employee volunteers to stop working for you. You don't force him.
To offer voluntary retrenchment, you have to ask employees to apply for it. You must set out the terms and conditions of the offer, says the Labour Law for Managers Loose Leaf Service.
For example, if you decide to offer something extra on top of the legal severance pay package, you must give details about this. And you must explain the criteria you'll use when looking at applications for voluntary retrenchment.
When you get applications, look at each case thoroughly and decide whether to accept or reject each application.
According to bowman.co.za, you don't have to accept all the applications you get.
You can reject an application for voluntary retrenchment if, for example, you don't want to lose employees with certain skills.
As with any labour issue, fairness is key.
You must use fair criteria and assess each application objectively. Otherwise, you may land up at the Labour Court.
In addition, you mustn't force your employee to accept voluntary retrenchment. Or give him incorrect information about the exercise.
So what happens when you reach an agreement on voluntary retrenchment?
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Here's what happens when you reach an agreement on voluntary retrenchment

Once you've looked at each case, consulted and agreed on everything, make it official by getting your employee to sign a voluntary retrenchment agreement.
The agreement, according to bowman.co.za, must state the terms. It must say your employee's employment will end due to operational requirements.

So what's the benefit to voluntary retrenchment?

According to the site, a voluntary retrenchment exercise could help you avoid forced retrenchment. These are often long, messy and tend to result in court cases.
But a voluntary retrenchment exercise can help you avoid all this.
They will also help you reach an agreement sooner and avoid long legal disputes and the costs that come with them. Plus, you'll end things on a good note.
Now that you know about voluntary retrenchments, use it if you need to cut costs in your company. Just make sure you do it legally.
PS: For more information on retrenchment, check out Retrenchments: How to make sure your retrenchment process is 100% correct.

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