It's important that you retrench employees in a legal manner. If you get this wrong, your employee's union can take action against you in terms of the Labour Relations Act (LRA).
Here's what a union can do if it's unhappy with your retrenchment procedure
If your employee's union is unhappy with the procedure you've followed, they have the right to approach the Labour Court on application (i.e. with the case being set out in affidavits) to force you to comply with a fair procedure and to stop you from dismissing in the meantime. This is allowed in terms of Section 189A (13) of the LRA.
According to the Labour Law for Managers Loose Leaf Service, in a case NUMSA v SA Five Engineering & others (2004), the Court held that Section 189A (13) (d) allows employees to seek compensation for procedural irregularities where interdictory relief or specific performance isn't appropriate.
An order of specific performance involves the court telling a party it must do something (as opposed to an interdict where the court is telling a party not to do something).
For example, the court may order you to go back to consultation and talk to the union about alternative jobs or the selection criteria, if it felt you didn't do this properly.
If the court felt there would be no point in ordering you to do something, it can also order compensation.
But, given the purpose of Section 189A (13), the court would usually first look to make an order designed to fix the unfairness that has resulted from your procedural failures. This would usually be an interdict or an order of specific performance.
What can you learn from this case?
The bottom line: It's crucial you follow a fair procedure when you retrench employees. This'll help ensure unions don't drag you to the labour court for not following a fair procedure.