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Labour Relations Act, 1995 (Act No. 66 of 1995)

Labour Market and Human Resource Development for Job Creation Social Plan

9. Regenerating Local Economics



1) General Approach


2) Once a large scale retrenchment which impacts on a region or local area becomes unavoidable, the process of social planning needs to start to look outside the enterprise to developments and opportunities in the local or provincial economy.


3) The parties support the call for the formulation and implementation of plans for the rehabilitation of areas that are being negatively affected by large scale retrenchments.


4) Government is committed to providing support to communities that take the initiative to drive economic development in their areas. Government support for such initiatives will need to be co-ordinated and be consistent with other economic and employment strategies in the area.


5) The Department of Provincial Affairs and Constitutional Development will provide a co-ordinating mechanism for communities seeking assistance in the context of large scale retrenchments.


6) Developing employment alternatives (stage one)


7) As soon as a company or sector realises that there will be large scale retrenchments which will negatively affect a local economy the following process should be followed:
a) The affected parties, employers and/or workers, should inform the local or provincial government about forthcoming retrenchments.
b) The relevant local or provincial authority may initiate a process that begins with a study to identify alternative opportunities in the area. The study should inform the development of a plan to ameliorate the impact of the retrenchment. The plan should build on existing information and strategies for local economic development.
8) Government is committed to providing support to this planning process by means of a centrally co-ordinated fund.


9) Implementing plans for alternative employment (stage two)


10) Once a local or provincial government has developed a plan, it will be advised by the co-ordinating government department, as to possible sources of assistance for the implementation of this plan. The sources will include existing and new support measures available from various government departments.


11) Such measures will include the following:
a) The supply-side measures of the DTI and activities of the Industrial Development Corporation, Khula and the Small Businesses Development Corporation (SBDC).
b) The Department of Constitutional Development's measures to support local government in local economic development.
c) Project support measures from the Department of Public Works.
d) Project support measures from the Department of Water Affairs.