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Nine things you MUST include in your notice of retrenchment letter

by , 13 August 2014
Retrenchments aren't easy for anyone.

Not only do you need to be sensitive, but, you need to implement them properly for them to be legal. This includes issuing a notice of retrenchment letter to your employees.

If you fail to do this, you could find yourself at the Labour Court. And this doesn't come cheap - defending a retrenchment case costs a lot of money. You may even end up in a worse position financially despite the savings you achieved by reducing staff!

Don't take that risk. Read on to discover the nine things you MUST include in your employee's notice of retrenchment letter so you'll retrench properly and avoid landing at the Labour Court.

When it comes to retrenchments, you must consult with the employees you plan to retrench or their representatives

If you reach an agreement on all issues, you should set out all the details in a written agreement and all of you must sign it.

If, however, you fail to reach an agreement, you must implement the retrenchments by giving notice to all the employees you want to retrench.

The notice letter must be in writing and should contain the following…

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Here are the nine things you must include in your employee's notice of retrenchment letter

#1: The name and designation of the employee you're retrenching.

#2: Confirmation that you're giving this notice after the process of consultation. You must specify the people who were part of the consultation.

#3: The date on which retrenchment takes effect.

#4: Whether or not you require your employee to work out his notice period.

#5: The package that the employee will receive on retrenchment (such as notice pay, leave pay, severance pay, pro rata bonus, any other applicable payment).

#6: What will happen with benefits such as pension/provident fund and medical aid (if applicable)?

#7: The details of any assistance that you've agreed on for retrenched employees.

#8: Whether or not you plan to hire the employee in future. If that's the case, you must set out how your employee must stay in touch with you so that you can let him know if a position becomes available.

#9: An appropriately worded parting message.

There you have it. Never take retrenchments lightly. Something as simple as a notice of retrenchment letter could land you at the CCMA if you don't include the right information.

So make sure you implement them properly, especially now that you know what to include in this notice.

PS: If you need more information on retrenchments, be sure to check out the Labour Law for Managers Loose Leaf Service.

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