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Only consider demotions in these three instances to avoid an unfair labour practice…
INSTANCE#1: Alternative to retrenchment
You would consider a demotion as an alternative to demotion. This is because even though the employee might be earning less money, they'll at least still have a job.
Keep in mind that should the employee refuse the demotion, they'll be entitled to severance pay, as long as his reason for refusing is justified. For example, it could be based on the fact that they're earning less money.
This would involve disciplinary action just short of dismissal. In other words, it's the only viable option, apart from dismissal itself.
The employee will need to agree to the demotion, and if he doesn't you'll have to have sufficient reasons to do so.
In a situation where the employee just isn't cutting it, you may consider demotion. Who knows, he might actually perform better in a lower position as opposed to his current one.
This may also apply to a new employee who you recently hired. For example, you may discover later on that she's not doing so well in the position she was hired for. But you've recognised her as a hard worker, and so you could lower her position, but still keep her as an employee of yours.
Always get an employee's consent to a demotion in writing, as doing such a thing entails the changing of an employee's terms and conditions of employment.
A demotion on arbitrary grounds, such as ones which do not fall under the above-mentioned instances, could very well be seen as an unfair labour practice. So be cautious when considering demotion as an option for employees.
*To learn more on unfair labour practices, page over to Chapter U 01:
in your Labour Law for Managers
handbook, or click here
to order your copy today.