Arbitration hearing without Employer being present

[Laura7]

Today I was at the bargaining council for my arbitration hearing and the employer did not send a representative. The commissioner decided to proceed with the hearing and my attorney presented the evidence that I was unfairly dismissed and that the disciplinary hearing was unfair. The commissioner appears to have accepted all our evidence and said that he will issue me with a certificate outlining my award. So it seems that I have won this case. My question is what will the employer do once he is notified of the outcome, will he apply for a rescission and delay the process. I suspect the company will use whatever means they have to to avoid paying out an award.

[Dave A]

Did you not ask for reinstatement?

[Laura7]

Hi there,

No I could not, the company has new owners and since my dismissal he has dismissed a few more for stupid reasons. It was said that he does not want the old staff near his building.

[Dave A]

Not much more you can do than take it step by step.
Good to hear you've got legal counsel to help you through.

[Justloadit]

Not sure what situation arose with the new owners. Generally, if the business is sold as an ongoing concern, then the new owner must take over the staff, and the employment continues as if there there has been no break in the employees status.

What I have done in the past, is that I get the old owner to retrench the staff as part of the sale, and they get paid according to the number of years of service. I then interview and employ the staff as new staff, and they start a new employment from that day forward.

If the new owner has dismissed a number of employees, then it may mean that the new owner purchased the business as an ongoing concern. The new owner dismissing staff on a whim falls under an unfair dismissal, and will then fall under the LRA and as such falls under the CCMA for mediation and arbitration. The fact that the new owner did not attend the arbitration meeting, places the new owner in a bad situation, and he may ignore the recommendation of the CCMA commissioner.

This will require you you take the case further, and to the labour court. If the new owner does not attend, then the a number of issues arise.
One of them being contempt of court, and the second, usually the judge, immediately issues an order for the owner to immediately pay what s due to you. In the case the new owner ignores this order, then a command is sent to the sheriff of the court to attach assets to the value of the payment, and if the owner still does not pay, then the attached assets are sold to raise the capital.

The problem is that this action can take up to a year or more.

So find a new job, but continue with the proceedings.

[Greig Whitton]

What I have done in the past, is that I get the old owner to retrench the staff as part of the sale, and they get paid according to the number of years of service. I then interview and employ the staff as new staff, and they start a new employment from that day forward.

Out of curiosity, how would you justify the retrenchments in this scenario? Presumably this is a non-issue if all of the employees are on board with the plan. But what if some are resistant? (e.g. if they are concerned that they may not be re-employed as promised)

[Justloadit]

Out of curiosity, how would you justify the retrenchments in this scenario? Presumably this is a non-issue if all of the employees are on board with the plan. But what if some are resistant? (e.g. if they are concerned that they may not be re-employed as promised)

What does a company owner do if he closes the company?
I also make no promises, as I have found from experience, that there is a lot dead wood, and undesirable employees who influence the rest.

[Greig Whitton]

What does a company owner do if he closes the company?

Except the owner isn't actually closing the business; he's selling it. So how does this actually work? Would the owner claim that he is closing the business (as a way of justifying the retrenchments) while actually proceeding with a sale? If so, wouldn't this incur the risk of retrenched employees who aren't re-employed hearing about the sale and claiming unfair dismissal?

[Justloadit]

There is a difference in buying a business or buying the books.

When you buy a business you buy the liabilities, even if you are not aware of them.
If it is not a public company, you do not have to buy the company, as there is only a business owner, which is the majority of the cases.
So the only safe way to get involved is that you buy the books, and effectively the business is closed.
The current owner is liable for all claims against the company, and one of them is staff.
The company is closing, so retrenchment is the only option to address any staff claims.

The fact that the purchaser continues in the same space, does not mean that the new owner must employ the retrenched staff.
In these situations, there is dead wood staff, and other staff which influences production and through put.

[Greig Whitton]

There is a difference in buying a business or buying the books.

Makes perfect sense - thanks for clarifying! Definitely something I will bear in mind for some of my clients who are planning to exit in the future.

(I misunderstood your original post - I thought you were referencing a business sale as a going concern; not a sale of the assets and subsequent closure)

[Justloadit]

There have been some posts about the danger of buying a business as an ongoing concern, and continuing trading as before, as there may be skeletons in the closest, which makes you the new owner now the responsible person.
There is also a danger for the seller, as there may be sureties in place, which suppliers do not wish to annul. The new owner can then trade recklessly, and you as the seller become responsible for the bills, as you are still standing as the original surety holder.

There is discussions and agreements between suppliers and customers when doing this, but I have found that in the majority of cases, none actually mind, provided that the business continues buying/supplying as before.

There are ways of maintaining the same/similar name but a new entity, but this is for another day.