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Thread: Obligation towards employees

  1. #1
    Gold Member Martinco's Avatar
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    Obligation towards employees

    The following scenario:

    I have a factory producing metal product i.e. fall under SA Iron and Steel.
    Should I sell the business to someone and this person buys the business with the option of giving the staff the option of relocating to say Gauteng and some or all of them choose not to take up the offer.
    As the outgoing owner.........what would be my obligation towards the people that choose not to go with the factory ?
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    Site Caretaker Dave A's Avatar
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    You (or the buyer, depending on the terms) would probably have to go through a retrenchment process.
    The trouble with opportunity is it normally comes dressed up as work.

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    Diamond Member Justloadit's Avatar
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    Dave you are correct.

    My past experience when I bought an ongoing concern, was to ensure the seller retrenched everyone with his own money. I then re-employed everyone, starting from a new day with a new employment contract. 2 years later due to economic pressure, I closed the company down, and fortunately having done this, only paid 2 weeks of retrenchment.

    There can be staff working for many years, and if you do not do this, you can be in for a fat bill when you close or down size.
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    Dave A (16-Feb-11)

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