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Global restructuring is subject to local operational requirements: CCMA confirms that the tail does not wag the dog

Can a South African subsidiary fairly retrench employees simply because a foreign parent company has decided to reduce global headcount due to global constraints, not local operational needs? A recent Commission for Conciliation, Mediation and Arbitration (CCMA) arbitration award provides a clear answer, namely: The decision of a foreign holding company to reduce its global headcount does not, without more, qualify as operational requirements of the South African subsidiary’s (employer’s) business.