Anyone following the financial news over the last number of years has no doubt noticed the increasing frequency with which corporations are merging, or being bought out by other corporations. This often results in efficiencies for the corporations, hopefully leading to greater profit. However, the impact on the employees is often overlooked. Whether the transaction is a share purchase, asset purchase, or other type of structure, the impact on the buyers and sellers is clear. However, the impact on the employees is often less certain.
When one corporation “buys out” another (by asset purchase, share purchase, or other transaction), the impact on the buyers and sellers is clear. There are clearly winners and losers which is what presumably drove the transaction to begin with. While the employers of the purchasing and selling companies. The structure of the transaction can have a significant impact on their futures. Fortunately, the Ontario Employment Standard Act does provide certain safeguards for employees in the circumstances. For example the Employment Standard Act imposes a requirement for payment of up to one week per year of service.