The Company I Work for Is Being Taken over. What Are My Rights?

• 

  scrimshaw on 27/11/2017 - 15:55

  +1

  I've never been in your situation, but I can offer you my Google-fu:

  Employee entitlements on a transfer of business

  When there is a transfer of business a new employer has to recognise an employee's service with the old employer when working out most of their entitlements, including:

  1. sick and carer's leave
  2. requests for flexible working arrangements
  3. parental leave.

  However, there are some entitlements that the new employer doesn't have to recognise. These include:

  • redundancy
  • annual leave
  • long service leave
  • unfair dismissal
  • notice of termination

  Source: Fairwork Gov Website

  • 

    dcep on 27/11/2017 - 16:04

    -1

    wow so they can just wipe the accrued annual leave ?

    Or referring to future entitlements ?

    • 

      HighAndDry on 27/11/2017 - 16:07

      +4

      No - it either gets carried forward or it's paid out by the old employee at time of transfer. No one loses it. Above commenter's summary ('Google-fu') is misleading and a tad dramatic.

    • 

      scrimshaw on 27/11/2017 - 16:17

      It's just a direct copy and paste, but further reading recommend as 0blivion suggests

  • 

    HighAndDry on 27/11/2017 - 16:06

    +4

    Just to not scare OP too much:

    redundancy(fairwork.gov.au)

    "A new employer that isn't an associated entity of the old employer can choose to not recognise an employee's service with the old employer for redundancy entitlements. The old employer will then need to pay redundancy to the employee upon termination."

    annual leave(fairwork.gov.au)

    "where the employers are not associated entities, the new employer can decide not to recognise an employee's service with the old employer. In this case, the old employer has to pay out the employee's untaken accumulated annual leave."

    long service leave(fairwork.gov.au)

    "This can happen when:

    an employee was not entitled to long service leave under a registered agreement at 31 December 2009
    an agreement was made on or after 1 January 2010 that replaces it
    the new agreement says that service under an older agreement does not count towards long service leave."

    unfair dismissal(fairwork.gov.au)

    "This can happen when the:

    employee is a transferring employee
    businesses are not associated entities, and
    the new employer lets the employee know in writing before the new employment starts that service with the old employer would not be recognised."

    notice of termination(fairwork.gov.au)

    "A transfer of business ends an employee's position with the old employer. Therefore, the old employer has to:

    give notice of termination, or
    provide payment instead of notice.
    If a transfer of business happens before the notice period ends, then the old employer must still pay the rest of the notice period.

    If a transferring employee, who was given notice by the old employer at the time of sale, is later terminated by the new employer, then the new employer must give notice of termination."

    TL;DR: OP KEEPS ALL OF THEIR ENTITLEMENTS OTHER THAN POSSIBLY LONG-SERVICE LEAVE ENTITLEMENTS WHICH ARE DISCRETIONARY TO BEGIN WITH.

    So let's not scare OP unnecessarily.

    • 

      Zinger on 27/11/2017 - 16:28

      thanks 0blivion. My understanding was that LSL is a legal obligation as it is regulated under different laws for each state but i am obviously wrong. I have accumulated 2 months of LSL and it would be a shame to lose it.

      • 

        HighAndDry on 27/11/2017 - 16:29

        Note there are only a few situations under which you can lose LSL:

        an employee was not entitled to long service leave under a registered agreement at 31 December 2009
        an agreement was made on or after 1 January 2010 that replaces it
        the new agreement says that service under an older agreement does not count towards long service leave.

        So it's far from given that you'd lose it, it's just also not certain that you'd keep it and I still try to err on the side of caution, even if I say not to scare people.

      • 

        Zinger on 27/11/2017 - 16:33

        @0blivion:

        yep exactly how I see it too. It is all in the hands of the new employers.

      • 

        HighAndDry on 27/11/2017 - 16:34

        @Zinger: Sorry no no, that's not it. It's not certain in that under some situations you might not keep it, under others you might, but it's also NOT up to the new employer's discretion.

      • 

        Zinger on 27/11/2017 - 16:54

        @0blivion:

        I just saw this on the Victorian business website

        http://www.business.vic.gov.au/hiring-and-managing-staff/lon…

        Where a business is sold, transferred or assigned, and an employee remains with the business, the new employer becomes responsible for the employee's long service leave entitlement. The period of employment with the old employer transfers to the new employer, who becomes liable for the long service leave accrued across the entire period of employment

        It might be different for every state but it seems that in Victoria, employees are entitled to keep their LSL unless under the situations you listed above (that does not apply for me).

      • 

        HighAndDry on 27/11/2017 - 16:57

        +1

        @Zinger: Sounds like you're covered. Just make sure the new company sticks to their legal responsibilities.

• 

  HighAndDry on 27/11/2017 - 16:02

  +1

  Your rights are generally not affected - you keep your accrued annual leave, sick leave, and long-service leave entitlements unless your original company is bankrupt and only having its assets purchased, or you're all being made redundant and then re-hired by the new company (in which case your entitlements should be paid out as part of the redundancy process), etc.

  Has anyone been forced to sign a new contract with the new employer, hence renouncing their right for a redundancy down the track?

  They can't "force" you to sign anything. What they can do is: You either sign the new contract, or you are let go (but you're still entitled to all your notice requirements and get your entitlements paid out now). Generally that's not to screw over existing employees so much as it is to bring everyone's employment entitlements/structure into line with the other company's.

  I am concerned that they might refuse to give me a redundancy and instead force me to leave/resign

  That's one possibility - that they might try to manage you out: giving you hard to reach KPI targets, not providing you enough in-house support, etc. If you suspect this is happening, diarise every incident, bring it to the attention of HR (and diarise that too), so that if/when they ultimately try to let you go for "performance issues", you have a shot of arguing constructive dismissal, and then if relevant, unfair dismissal/etc.

  • 

    Zinger on 27/11/2017 - 16:32

    +1

    thanks for the advice mate. Exactly what I'll do. A mate of mine used to work for them and they sacked her under the pretence that she was not meeting her KPIs. Her lawyers argued that she was paid a bonus the previous month and the allegations were obviously fake. it will be hard to move from a company that treats you like family to another one where they don't care about you/ your rights.

    • 

      HighAndDry on 27/11/2017 - 16:37

      Yeah - don't worry too much but do have your own arse covered just in case. If it happened to your mate, well that's not a great sign. Maybe they learnt from the drubbing they (presumably? hopefully?) got in that case and won't try to pull the same stuff again.

      And - sticking with the "don't panic but be prepared" line of thinking, might want to polish up your resume and put out feelers for openings in other firms (discreetly), again just in case. While what happened to your mate was obvious, there are ways to 'performance manage' someone out in a way that's hard to legally argue against.

      Best of luck!

      • 

        Zinger on 27/11/2017 - 16:59

        No, it was all done under the radar. My mate was paid out eventually as word never came out of their dodgy practices. But as you said, they might have learnt from their mistake OR got a bit more clever in pushing people out.

        Good advice there.. I might give the good old resume a bit of a polish (has not been used in the last 10 years!)

        Thanks!

• 

  chumlee on 27/11/2017 - 16:26

  +2

  You will be fine.

  The new company can either let your entitlements keep accruing or decide to pay you out and have it reset.

  If you are made redundant they owe you what's in your current contract. They cannot make up stuff and refuse to pay you out

  • 

    HighAndDry on 27/11/2017 - 16:30

    That's a far better, and more succinct, summary than my comments haha.

  • 

    Zinger on 27/11/2017 - 16:40

    I hope so chumlee. I would not mind being made redundant to be honest if I get paid all my entitlements+redundancy.

    Based on a conversation with fairwork this morning, it all depends on how morally ethical the new company is and also, it depends on the contract of sale. I just hope that they do the right thing by us.

• 

  reno on 27/11/2017 - 16:38

  +1

  It's all dependent on what the "take over" means. From our view we don't know the details on the transaction (it could just be that the company is "closing down" and the new company is taking the existing base of customers etc… and offering the existing employees a new place of work).

  There's many different ways as to how to structure the "take over"… and the worst case for you would be that you're just hired as a new employee (technically speaking the worst case is they don't take any of the existing employees…). If this does happen, then long service, sick leave etc… you're starting from scratch. You'd only get paid out your annual leave (unless you do have your long service ready to be taken).

  • 

    Zinger on 27/11/2017 - 16:52

    The new company is buying us to take over and run our business. They are taking on board all our employees but I think they will be spitting out people in management roles as they could use their existing manpower to manage the existing staff.
    i just found this on business.vic.gov.au which is quite re-assuring

    http://www.business.vic.gov.au/hiring-and-managing-staff/lon…

    Where a business is sold, transferred or assigned, and an employee remains with the business, the new employer becomes responsible for the employee's long service leave entitlement. The period of employment with the old employer transfers to the new employer, who becomes liable for the long service leave accrued across the entire period of employment

    Also of interest to me:
    If an employee is dismissed by the old or new business owner but is re-hired by the new business owner within 3 months, employment is not broken for purposes of the LSL Act.

    • 

      reno on 27/11/2017 - 17:54

      As mentioned the buying out could be structured such that old company ceases trading on day X. Everything then switches over to be under new company from next day

      Board and management won't matter as new employees since their remuneration plans and incentives are very different to us plebs unfortunately

      Unless it's a great deal, new company wouldn't want to pay extra for all the leave as liabilities on their books

• 

  chriskq on 27/11/2017 - 20:07

  Similar thing happened to the previous company i worked for.

  The company i worked for was sold to /acquired by a new company. We were initially told no changes to current business/processes would occur, and the new company did let us do our own BAU thing for about 10 months. Then almost half of the staff were made redundant under a re-structure and then the remaining half left over the next few months with so much change. Billable targets increased by 33% too which made it a pretty stressful environment to work in plus we came from a more agency style of company and warehouse office and had to then fit into a more corporate grey/vanilla company.

  You've been given good advice above about keeping notes of everything and no harm in toughing it out while you put the feelers out. Be sure not to use company email or Laptop/PC for any non company tasks like new applications, resume, social media etc.

  Surely it would be a pretty crumby thing for the new company to action redundancies so close to xmas and holidays but you never know

  • 

    SPCTRE on 28/11/2017 - 01:56

    Can confirm this is the usual practice of takeovers.
    They usually let things run for a year before doing a re-structure.
    Re-structure could mean anything so like others have said, best to keep on your toes. Good luck

    • 

      Zinger on 29/11/2017 - 10:01

      thanks guys. We will wait and see. Hopefully they do the right thing by us.
      Thanks for all the advice and words of encouragement.