Employment law issues arise in most corporate transactions, whether it is a share sale or purchase, business transfer or other similar transaction.
In the context of merger and acquisition transactions, the types of difficulties which may arise depends on the nature of the individual transaction. Failure to adequately examine the existing rights and obligations between the target company and its employees can result in expensive employment claims, administrative fines and other liabilities.
It is advisable that a due diligence is carried out to identify and assess all potential employment liabilities. These may include:
- issues with collective bargaining agreements
- misclassification of employees (e.g. as independent contractors – freelance)
- pension schemes
- employee benefits
- accrued and as-yet unpaid time off
- existing legal claims and potential legal claims
The due diligence may also help redundancy and retention strategies, ensure regulatory compliance, harmonise employment practices in the new combined entity and deal with cross-border clashes in employment culture.
The above should be used as a source of general information only. It is not intended to give a definitive statement of the law.
How can we help?
At Theodorou Law we have over 15 years’ experience in advising and representing national and international companies in employment law matters.
We can guide clients through all the various employment law issues which may arise in a a merger and acquisition transaction. Im particular we can provide practical solutions and advice clients with:
- risk analysis on the employment/HR implications of the transaction;
- post completion employment law issues or transitional arrangements, redundancies, restructurings and harmonisation exercises;
- termination and settlement agreements.
We can negotiate contractual provisions and draft necessary documents such as :
- share sale or business transfer agreements to reflect the commercially agreed position and allocation of risk;
- retention payment letters/agreements;
- new service agreements;
- consultancy agreements;
- appointment letters/agreements;
- termination and settlement agreements.
If you have a query or wish to receive further information, please contact us using [email protected]
