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OVER 100 COMPANIES TO LAY OFF STAFF

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MBABANE – Over 100 companies across several sectors will lay off employees due to the negative impact of the coronavirus pandemic.


These companies have approached the Ministry of Labour and Social Security seeking advice on how best to go about the process.
Acting Labour Commissioner Mthunzi Shabangu confirmed this and said most companies started liaising with his office after government issued Guidelines on Employment Contingency Measures in Response to the Coronavirus (COVID-19) Pandemic Notice of 2020 last week.


The guidelines provide options that businesses and employers could employ to mitigate against the effects of loss of earnings.


Security


The options that are acceptable during the period of the lockdown, due to the pandemic, include granting employees annual paid leave, applying for a release advance of the bond of security of wages, granting employees advance salaries, shift work and lay-offs.
Shabangu said at the beginning of the lockdown, employers would casually call his office to make enquiries.


However, he said after the guidelines were announced and gazetted, over 100 employers made serious consultations that were more inclined towards the lay-offs option and not the softer options provided in Section 4 of the document.


Section 5 provides that in the event that any of the measures that were meant to mitigate against the effects of loss of earnings were exhausted (a) lay-offs could be considered.


Lay-offs were described as an arrangement where the employer could lay off employees for a period not exceeding two months, provided that such unpaid lay-off was approved by the commissioner of labour.
“The normal timelines for giving notice of lay-offs to employees are suspended in respect of lay-offs that are recurrent to the period of national emergency,” the guidelines state.


When asked if all the companies that had approached the ministry had proved that all the softer measures had failed, hence the lay-off option; the labour commissioner said the softer conditions were not automatically applicable to all companies.


Exhausted


“We do have those companies that have exhausted the softer means but the situation still worsened, while others are just out of the bracket of those options,” he said.
Shabangu listed businesses such as the textile industry, hotels, restaurants, pre-schools, handicraft, forestry, construction, filling stations and transporters of staff, as those that had filed applications to lay off employees during the pandemic period.
He said so far there were no applications from the retail industry.


“We are already working on the applications and they are coming in from almost all sectors.”
When asked about domestic workers, Shabangu said the procedure was still the same even in their case.
“The only challenge is that most domestic-worker practices are informal yet this is a regulated industry which should apply all terms and conditions like all other industries.”


He explained that during the lay-off period both the employer and employee had an obligation to abide by employment rules, such that if an employee decided to find another job he/she was supposed to follow the standard procedure of terminating employment.


When asked if all the requests for lay-offs that his office attended to were valid, Shabangu said most of them were.
“We have very few cases whereby we advise employers to explore the softer options where we feel they had not done enough or they were quick to conclude that they were worse off.”


He made an example that they would not approve a company that employed 14 people to lay-off six employees, because that would be discriminatory as the others would continue working.


Retrenchments


He said the best option in such a scenario would be to apply the shift work or short time option.
The next plan after lay-off, as stated in the guidelines, is retrenchments.


Shabangu said this was out of the way for now because government did not view the current lockdown situation as severe enough to warrant such action.
“The regulations do not offer retrenchments for now, except for those companies whose retrenchment was already underway or in the pipeline before the pandemic.”


He said there were many reasons why they were not approving retrenchments, which included that they were costly by nature as employees have to be paid certain benefits; the process itself was costly as it involved hiring of auditors for presentation of audited statements; and that there was a notice time-frame of not less than 30 days.

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