BCS: Helping business clients with opportunities and through crises since 1995

Avoiding employment lawsuits in mergers and acquisitions

Mergers and acquisitions are an essential opportunity for many business owners. They can be great for employees but can also be devastating for some.

Most employees know that talk of a takeover or merger could affect their job security. So, as soon as you start considering one of these options, you need to consider the effect on your staff. It is hard to keep secrets in the business world, and people may figure out there is change afoot long before you formally announce it.

If you need to cut staff, consider how to do so fairly and lawfully

You must stay within the law if reducing or reshuffling your workforce. You should also be seen to be operating within the law. There is a subtle difference. For example, if you feel a certain person is the weaker of two people in a similar position, you may consider them the obvious choice to let go when you no longer need both. Yet, if they think there is something personal in your decision, they may take you to court over it.

For example, you are merging with another company and feel the HR manager from the other company is stronger than your current one. Your current employee may feel your decision is less about their ability and more about recent arguments you have had about the situation in the Middle East, where differences in your religions or roots have led you to take opposing sides.

If you are unsure how to handle staffing issues in a merger or acquisition, taking legal help to ensure you do not infringe any equal employment policies can reduce the chance you need it to defend yourself against accusations you breached those laws.