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Johannesburg - Improper labour practices hindered attempts by state-owned enterprises to implement retrenchments as cost-cutting measures, leaving them with huge legal bills instead.

Labour lawyer Bradley Conradie said the cash-strapped companies didn’t follow the correct procedures when dealing with retrenchments and were also crippled by managers who lacked the expertise to deal with retrenchments.

He believes that the companies failed to formally and procedurally inform unions of their intention to retrench workers, resulting in several legal showdowns which usually ended in the favour of organised labour. The state would have to foot the legal costs of unions in most cases.

Just this year, planned retrenchments were halted at the South African Post Office, SAA and Telkom, where management had resolved that the only way to save money for critical operations would be to deal with overstaffing.

Unions rushed to the Labour Court, halting planned retrenchments, and negotiated comfortable deals for their members. While it was the prerogative of unions to resort to any measure to help its members, the enterprises were also failing to implement their own researched remedies to crisis.

“In the end, the announcements of retrenchments are replaced by announcements that the parties are engaging each other in ongoing discussions, which inevitably means that the proposed retrenchments will quietly disappear over time or are replaced by generous severance packages,” Conradie said.