Job losses: CCMA records more than 22 000 retrenchments in one year

Recent economic challenges have led to significant job losses across various sectors in South Africa.

During the 2023/2024 financial year, the Commission for Conciliation, Mediation and Arbitration (CCMA) reported 22 554 retrenchments.

According to the Department of Employment and Labour, “out of 38,428 employees who were likely to be retrenched, 14,887 jobs (39%) were saved through various interventions”.

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Employment and Labour Minister Nomakhosazana Meth revealed an increase in the budget for the department’s Temporary Employer-Employee Relief Scheme (TERS) from R400 million to R2.4 billion for the current financial year.

This is aimed at assisting companies in distress and preventing employee layoffs amid unstable economic conditions.

“The increase in the TERS budget is a proactive response to volatile economic trends that threaten the livelihoods of impoverished workers and the sustainability of businesses. Our goal is to preserve jobs and support companies facing financial difficulties.

“Furthermore, the increase in the scheme’s capacity aims to reduce the risk of further retrenchments and support economic stability,” she said.

Sectors with the highest job losses

According to the department, the following sectors recorded the highest number of job losses:

• Mining: 5153 job losses
• Manufacturing: 2125 job losses
• Telecommunications: 1680 job losses

TERS has been instrumental in supporting various industries severely impacted by economic challenges. The following sectors have notably benefited from the scheme:

• Hospitality and tourism: Hotels, restaurants, and travel agencies are affected by decreased tourism.
• Manufacturing: Factories experiencing reduced demand and supply chain disruptions.
• Retail: Non-essential retail businesses facing reduced consumer spending.
• Transportation: Bus services, and logistics companies dealing with decreased operations.

TERS applications

The department said the single adjudication committee administered by the CCMA evaluates all TERS applications for eligibility using a combination of indicators.

Employers seeking to participate in the TERS scheme will be required to provide documentary evidence for evaluation:

• “Audited Annual Financial Statements for the past two financial years.
• Independently Reviewed Annual Financial Statements for companies not legally required to be audited, covering the past two financial years.
• Independently Reviewed Management Accounts with comparative figures if the latest financial statements are older than three months.
• Termination of Contract and Bank Statement for individual applicants.
• Business Case outlining the triggers for distress and proposed remedial actions.”

The minister urges companies experiencing financial challenges to participate in the scheme as soon as they notice signs of distress.

“The nature and degree of distress will be objectively measured through indicators, including but not limited to a decline in revenue. The application process for TERS begins at the CCMA and is free of charge. There are no application, initiation, or administration fees required,” Meth concluded.

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