Retrenchment board divided over layoffs

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SHARP differences have emerged within the Retrenchment Board as to how to proceed with retrenchment applications given the current deadlock over the issue at the Tripartite Negotiating Forum, businessdigest has learnt.

Staff Writer

Negotiations over the amendment of the entire Labour Act broke down at a Labour Law Advisory Council meeting chaired by director of labour in the Ministry of Labour, Clemence Vusani on July 7. Business and labour are deadlocked over the retrenchment process as well as the dispute resolution mechanism in the event that there is no agreement between the employer and workers.

“There are some of us in the board who feel that processing retrenchment applications while the issue is yet to be finalised at TNF will prejudice the constituency we represent,” one insider said. “However there are others who feel that we should go ahead and continue processing retrenchment applications.”

The disagreements could have an effect on the speed at which the board will process applications for retrenchments.

The board has been besieged with applications by companies to be exempted from paying the stipulated packages of two weeks’ pay for every year served as most of them cite viability constraints
Business and labour are not agreed on the proposal, which stipulates that if an employer applies to the Retrenchment Board for exemption from paying a severance package and does not get a response from the board in 14 days, then that application will be deemed accepted.

The other issue where the parties differ is the appeal process to the Retrenchment Board in the event of disagreements on severance package between employers and employees. Employers are in favour of making the decision reached by the board to be final. Labour, however, insists that workers should have the right to appeal if they are not happy with the decision of the Retrenchment Board.

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