Mell What do you mean by retrenchment?
Retrenchment is a form of dismissal due to no fault of the employee, it is a process whereby the employer reviews its business needs in order to increase profits or limit losses, which leads to reducing its employees.
What does retrenchment mean in law?
the termination of employment
Retrenchment means the termination of employment of an employee whose position has been declared to be redundant and who is unable to be redeployed into an appropriate position. Sample 1.
What are the types of retrenchment?
There are three types of Retrenchment Strategies:
- Turnaround.
- Divestment.
- Liquidation.
What is a retrenchment strategy?
What do you understand by retrenchment strategies? A strategy used by corporations to reduce the diversity or the overall size of the operations of the company. This strategy is often used in order to cut expenses with the goal of becoming a more financial stable business.
What is retrenchment explain with example?
Retrenchment is defined as cutting back or a reduction. An example of retrenchment is a company laying off employees to get back within budget.
What are the rules for retrenchment?
The retrenchment procedure as laid down in the Labour Relations Act (LRA) must be followed properly and in good faith by the employer. The employer must also prove that he/she has shared with the targeted employees (or their representatives) all documentary and other information pertinent to the retrenchment.
What is the notice period for retrenchment?
If employed for less than six months – one week’s notice; if employed for more than six months but not more than one year – two weeks’ notice and if employed for more than a year – four weeks’ notice. Domestic and farm workers, who have been employed for more than six months, must receive four weeks’ notice.
What are the signs of external retrenchment?
19 Early Retrenchment Signs You Need To Know
- Your boss is communicating less frequently with you.
- HR Meetings become long and frequent.
- Outsiders are talking about retrenchment.
- You don’t get invited to regular meetings.
- You are getting bypassed.
- You receive a new understudy.
- Your training applications routinely get rejected.
What are the examples of retrenchment strategy?
7 Examples of a Retrenchment Strategy
- Selling Assets. Selling assets such as investments, facilities, machines or entire divisions of your organization.
- Abandoning Markets.
- Abandoning a Line of Business.
- Decreasing Production.
- Eliminating Redundancies.
- Downsizing.
- Outsourcing.
What is retrenchment What are its causes?
Retrenchment normally arises from decisions to change strategic direction, which in turn usually happens because of one or more of the following: New leadership (usually a new CEO) Excessively-high costs and low profitability (or unsustainable losses) Low ROCE. Excessively high gearing (leading to cash flow problems)
Can you refuse retrenchment?
What is clear from the judgment is that an employer, in the context of a retrenchment exercise at least, may dismiss employees for refusing to accept a change to terms and conditions of employment, provided of course that the employer can demonstrate that there is a genuine operational need to change terms and …
How does retrenchment work during lockdown?
During the national lockdown, section 189 of the Labour Relations Act 66 of 1995 will continue to govern the procedures that must be followed for a fair and lawful retrenchment. Retrenchment is a form of dismissal due to no fault of the employee.
What are the advantages and disadvantages of retrenchment?
Retrenchment increases profits for shareholders and creates a strategy to survive economic downturn. The disadvantages of retrenchment include growth decline, reduced profits, smaller workforce, reduced productivity and inability to meet consumer demand.
When to use the term’retrenchment’in business?
Retrenchment is a term used to describe when a business decides to significantly cut or scale-back its activities. Retrenchment might occur when one or more of the following happen to a business: What Are the Causes of Retrenchment?
Is the Retrenchment strategy a cost effective strategy?
Nevertheless, retrenchment is the first aid to the damages sustained before thinking of better ways to recover from the trauma. This is why the retrenchment strategy in business is so positively cost-effective without taking a larger toll on the organization or the company. The is one of the best retrenchment benefits.
What is the purpose of retrenchment in the military?
Retrenchment is a strategy designed to reduce a country’s international and military costs and commitments. [1] This can be done by cutting defense spending, withdrawing from certain alliance obligations, scaling back on deployments abroad, or reducing international expenditures.
What is the definition of a Retrenchment strategy?
So now let us start with the retrenchment strategy definition. What is Retrenchment Strategy? Retrenchment strategy is a practice done by organizations to gain a better financial position by lowering or reducing the costs of any of its business operation. 1. General strategy:
When does a business decide to retrench?
Retrenchment is a term used to describe when a business decides to significantly cut or scale-back its activities. Retrenchment might occur when one or more of the following happen to a business:
What are the advantages of retrenchment, divesture, and liquidation?
The principal advantages of retrenchment, divesture, and liquidation strategies that enable the company to •Phase out product in the decline stage of the product life cycle. •Eliminate mismatches with the firm’s main strategy or sub strategies or mismatches or organizations fit.
How is retrenchment used in US foreign policy?
This can be done by cutting defense spending, withdrawing from certain alliance obligations, scaling back on deployments abroad, or reducing international expenditures. Retrenchment does not necessarily involve the avoidance of all strategic commitments. But the desired direction with retrenchment is one of lowered cost and reduced commitment.