Ondernemingsredding en werknemers in die Suid- Afrikaanse reg: “verlore siele” of nie?
Jacobs, L. M.
Smit, D. M.
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In South Africa, business rescue is a procedure created by the Companies Act 71 of 2008, which aims to facilitate the rehabilitation of companies in financial distress. Not all companies in financial distress will fail; some only need care and guidance to keep the wolf from the door. The business rescue procedure grants a financially distressed company the opportunity to re-organize its affairs by allowing for a moratorium on legal proceedings and the implementation of a structured payment scheme with creditors or, alternatively, to provide the creditors and shareholders with a better return than in liquidation. In addition, it could also be argued that a further objective of the business rescue procedure is the retention of the company’s workforce, entirely or to some extent, at least. Despite their improved position in rescue proceedings, employees remain vulnerable and have subsequently been regarded as “lost souls” in corporate insolvency procedures. It is widely acknowledged that employees are now in a better position when it comes to protecting their rights during employment. In business rescue proceedings, the primary view held by many is that employees are in a much better position than they were during rescue proceedings in the past. The Companies Act makes extensive provision for the involvement of employees who are affected by the business rescue process, in its undertaking or implementation, and creates a platform for them to contribute to an outcome that affects them. This article investigates the outcome of business rescue proceedings on employee rights during the phases of business rescue, both in their capacities as employees and creditors of the company, and over the course of various employment relationships. It will be concluded that employees are not as protected during business rescue proceedings as is generally believed.