The main member of the cc decided to close down the cc and the business was not profitable and could no longer sustain this method of operation. The main member would therefore start operating as a sole proprietor.

It was decided to shut down the cc with immediate effect. 2 of the employees accepted an offer to continue working for the sole proprietor but as contract workers and receive a higher hourly wage than when they were employed full time. Before the 3rd employee could be made the same offer, he took the cc to the ccma. After the hearing – which was unresolved, he was given the same opportunity to work for the sole proprietor on contract basis at a higher hourly rate. He said he would consider it but came back 4 days later saying that he will not be able to accept the contract work as he had found alternative employment. He indicated that initially the employment was on an ad hoc basis until he could no longer claim UIF but he was unable to do any work for the sole proprietor.

The questions
He now wants severance pay ie 1 week per year’s service. If the business is closed do they have to pay this?
Another question, the company was closed with immediate effect. The same employee wants his 1 month’s notice pay. If we agree to pay this, can we insist that he does work for the company in this time?

(Our standard employment contract says : Pro-rata leave and severance pay might be payable.)