The Notice of Retrenchment Letter is a crucial document in South African employment law, used when an employer needs to terminate employment relationships for operational requirements such as economic, technological, structural, or similar needs. This document must comply with Section 189 of the Labour Relations Act and reflects the outcome of a mandatory consultation process. It should be issued only after proper consultation with affected employees and/or their representatives, and must contain specific information including the reasons for retrenchment, severance pay calculations, and notice period details. The letter serves as both a legal record and a formal communication tool, protecting both employer and employee interests during the retrenchment process.
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1. Company Letterhead and Date: Official company letterhead with full contact details and date of notice
2. Employee Details: Full name, employee number, position, and department of the affected employee
3. Subject Line: Clear indication that this is a Notice of Retrenchment
4. Confirmation of Consultation: Summary of the consultation process that has taken place under Section 189
5. Reasons for Retrenchment: Clear explanation of the operational requirements leading to retrenchment
6. Selection Criteria: Explanation of how the selection criteria were applied
7. Notice Period: Specification of the notice period and last working day
8. Severance Package: Details of statutory severance pay and other entitlements
9. Final Payment Details: Breakdown of final payment including leave pay, pro-rata bonuses, etc.
10. Certificate of Service: Confirmation that a certificate of service will be provided
11. Signature Block: Space for employer representative signature and designation
1. Alternative Position Offers: Include when alternative positions within the company are available
2. Skills Development Opportunities: When the company is providing training or upskilling opportunities
3. Counselling Services: When the company offers psychological support or career counselling
4. Reference Letter Offer: When the company is willing to provide detailed reference letters
5. Re-employment Clause: When the company wishes to specify conditions for possible future re-employment
6. External Support Services: When providing information about government support or unemployment benefits
1. Appendix A - Severance Calculation: Detailed calculation of severance pay and other benefits
2. Appendix B - Leave Pay Calculation: Breakdown of accumulated leave pay calculation
3. Appendix C - Support Services: List of available support services and contact information
4. Appendix D - Handover Requirements: Checklist of handover tasks and company property to be returned
5. Appendix E - Consultation Process Record: Summary of dates and outcomes of consultation meetings
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