Redundancy and Retrenchment

Redundancy and retrenchment

Redundancy usually occurs when, through no fault of your own, the job you have been doing is no longer required to be done by anyone. Effectively, to be a genuine redundancy, your job must cease to exist.

Your job is made up of many things including, for example, your job title, your pay, your hours, where your job is located and your duties. Consider all of these factors together when you ask yourself whether your job has truly ceased to exist.

Redundancy may occur for a number of reasons, for example:

  • a downturn in production, sales, or the economy generally;
  • the introduction of new technology;
  • business relocation;
  • the duties of your position are reallocated to other employees;
  • the business merges with another business or is sold;
  • an internal company restructure occurs; or
  • your employer becomes insolvent or bankrupt.

Remember, it is the job that becomes redundant, not you.

If you lose your job as a result of a redundancy, this is called a “retrenchment”. An alternative to retrenchment might involve, for example, you moving to a different position with the same employer. This is called “redeployment”.

If your job is made redundant and you are retrenched, you may be entitled to notice of termination or pay instead of notice, redundancy pay and other entitlements. Even if you get paid your entitlements, you may still be able to challenge your dismissal if your redundancy is not genuine or if you were selected for redundancy due to an unlawful reason such as discrimination. You only have 21 days from the date your dismissal took effect to file an unfair dismissal or General Protections Dispute termination claim.

For more information on Redundancy, Unfair Dismissal and General Protections see the below infosheets.

Redundancy - download

Unfair Dismissal - download

General Protections Dispute (Termination) Claim - download

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