Morals and ethics aside - It is unlikely the employees would pursue the issue. Particulalry as there is more than 1 employee, unfair retrenchments become Labour Court issues and not CCMA. Thus it is more expensive and is at least a year before it gets there. Take these problems and the cost and factor in against whom they will claim, and the risk is too high.

Of course, the issue of a sale will bring other implications, such as the staff cannot just be removed, and the buyer and purchaser remain liable for retrenchment and claims, depending on the wording of the sales contract - BE CAREFUL.

As Dave points out in a liquidation the order of preference is Employees, SARS, Accountants and Lawyers(no one said life is fair) - I raise this issue in that you can make settlement agreements with the creditors, which does not ahve any judgement implications. From your statement that you can trade out of it, I presume the creditors are not owed much. If a creditor is owed R40 000 and you offer R30 000 to settle, they will in all likely hood take the deal. This depends on the cash available from a sale.

I suppose some other strategy could be a management buy out?
Is retrenchments in some form not an option? This will reduce your running costs for now(helping reduce debt quicker) and at teh same time reducing the running costs thus making it more attractive to a perspective buyer. Short time can ease cash flow, running costs and often employees tehn get other work, removing the retrenchment package cost.

Quite a few options, each with their own complications.
Are you in the motor industry by any chance?