When selling a business with employees there are some rights and obligations to employees that must be followed in order to ensure a smooth closing. It will also help to avoid potential litigation after the sale of the business. Sometimes when a business is sold the employees become part of the sale of that business in the transfer of ownership.
When employees are terminated because of the sale of a business, it can potentially become very expensive and therein lies the potential for litigation.
Other Issues When Selling A Business With Employees
Another issue when selling a business with employees is whether or not the workforce is unionized before the sale of the business. This can also make the sale a little more tricky and requires complete understanding. There are different rights and obligations associated with each scenario, and each one requires different clauses and representations in the agreement of purchase and sale.
Both the seller and buyer of the business need to make sure that any representations or warranties inserted into the agreement do not put either party in a situation where those representations or warranties can be found to be invalid.
A good employment lawyer can help when selling a business with employees and also make sure that all rights and obligations on all sides are followed to avoid any litigation and delays in closing.
Watch this episode with employment lawyer Meghan Ferguson of Devry Smith Frank LLP where she will discuss selling a business with employees and the rights and obligations associated with it.
For more information on employment law or if you’re looking for an employment lawyer contact:
Meghan Ferguson, B.A., LL.B.
Devry Smith Frank LLP
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