Transfer of the company
The transfer of a company or part of it often involves reorganization, changes in employment contracts, and even layoffs. A formal procedure must be followed before the transfer can become effective. In terms of labor law, the employer must respect a certain number of obligations towards his or her employees before transferring his or her business.
Effects of the transfer
When an employer announces the transfer of the company, employees have many fears. They are sometimes afraid of being fired or of losing their rights related to their seniority in the company. What is the reality?
The transfer of the company implies important costs for the acquiring employer. Employees often wonder whether they will be paid back wages, whether they will be paid overtime and whether the new company will meet all its obligations.
When an employer transfers his or her business, it does not mean that he or she is relieved of all his/her obligations to his/her former employees. The new employer also has a certain responsibility for the employees' claims that arose before the transfer.
Termination of employment
The acquiring company does not necessarily need all the employees of the transferred company. The employer is therefore tempted to dismiss some of his or her employees in order to facilitate the transfer of the business. Is this allowed?
Sometimes the employee does not want to be part of the new company. How can he/she object to the transfer? What are the consequences of an objection?
Information and consultation
The transfer of a company is often fraught with consequences for the employees of the transferred company. The employer is obliged to give a good amount of information to his or her employees. Moreover, he or she will have to give them a period of time to formulate proposals to mitigate the negative consequences of the transfer of undertaking, in certain situations.