MAY AN EMPLOYER RETRENCH A POOR PERFORMER?

[Ivan Israelstam]

An employee’s sales performance is far below standard. The employer has therefore recently commenced a performance improvement process with him. He is aware that his sales are so poor that the company’s revenue is suffering significantly. The low revenue has resulted in the employer being unable to meet its financial obligations and has therefore decided to implement a section 189 retrenchment process to potentially retrench 3 employees.
The poor performer is the newest of all the company’s employees and the employer proposes to use LIFO as its criterion for selecting potential retrenchees. Is the employer legally entitled to include the poor performer amongst the 3 employees subjected to the 189 process and retrench him if no viable alternatives are found?

[Herman Breedt]

Yes, they may, if it is about operational requirements and not performance AND if they apply the selection criteria objectively

[Patrick Deale]

Yes – in addition to the LIFO criterion, the employer can select the poor performer amongst the three for retrenchment based on the criterion of skills and performance requirements. It would be safer if the employer had previously counselled the employee about his or her poor performance and could show some evidence to show the performance was sub-standard. This would help to dispel the perception that the selection was based on an arbitrary and or subjective opinion.

[Michael Bagraim]

I have read Patrick Deale opinion and I’m very much in line with it, however if there is a trade union involved it would have to have their consent.

[Author]

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