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Employee Rights During Company Mergers and Acquisitions

April 10, 2024 Admin Employment Law

In the dynamic business landscape, mergers and acquisitions (M&A) are commonplace, often heralding significant changes for the entities involved and their employees. During such transitions, employees need to understand their rights and the implications these corporate maneuvers might have on their employment status. At Rager & Yoon – Employment Lawyers, our commitment to safeguarding the rights of employees in Los Angeles and beyond has prompted us to outline key considerations and rights you should be aware of during these periods of change.

Mergers and acquisitions, though frequently mentioned in the same breath, entail different processes and legal considerations. A merger combines two companies into a single entity, while an acquisition involves one company taking over another. Despite these differences, both scenarios can lead to significant organizational changes, affecting everything from company culture to job security.

Your Rights As An Employee

Right to Notice

Employees are often entitled to be notified about significant changes that could affect their employment. For instance, the Worker Adjustment and Retraining Notification (WARN) Act requires most employers with 100 or more employees to provide a minimum of 60 days’ notice before any mass layoff or plant closing.

Protection Against Unfair Dismissal

While employment in many states is “at-will,” meaning you can be dismissed for any reason not prohibited by law, certain protections exist during mergers and acquisitions. For example, if your employment contract includes a clause that protects your position in the event of a merger or acquisition, your employer must honor this agreement.

Severance Pay

In cases where layoffs are inevitable, you might be entitled to severance pay. Your employment contract or the company’s employee handbook often outlines this. Specific agreements made during the M&A process may also stipulate severance conditions.

Benefits and Pensions

Your rights to certain benefits, including pensions, should be carefully considered during M&A activities. The Employee Retirement Income Security Act (ERISA) protects employees’ pension and health benefits rights. Understanding how a merger or acquisition could impact these benefits is crucial.

How To Protect Your Rights

  • Review Your Employment Contract: Understanding the terms of your employment is crucial. Look for any clauses related to mergers and acquisitions, and consider consulting with an employment attorney to understand your rights fully.
  • Stay Informed: Keep abreast of any official announcements from your employer about the merger or acquisition. Being informed will help you anticipate changes and prepare accordingly.
  • Seek Legal Advice: Consulting with a Los Angeles employment attorney, especially one familiar with Los Angeles employment law, can provide you with a clear understanding of your rights and the best course of action during these transitions.

Conclusion

Mergers and acquisitions can be a time of uncertainty for employees. However, armed with the right information and legal support, you can confidently navigate these changes. At Rager & Yoon – Employment Lawyers, we are dedicated to protecting your rights during these complex processes. If you have any concerns about how a merger or acquisition might affect your employment, do not hesitate to contact us for guidance and support.

Remember, as an employment attorney based in Los Angeles, our expertise is your safeguard during these turbulent times. Let us help you secure your rights and future in the evolving business mergers and acquisitions landscape. To get a free consultation, call us at 310-527-6994 now.

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