In The News

Preparing for the Impact of Acquisition

HR Magazine

10 Dec 2021

Oliver Spratt authored an article for HR Magazine discussing the impact an acquisition or merger will have on the company’s employees and founders, and what founders can to do minimize the disruption for everyone involved.

“The immediate impact of an acquisition on a company’s employees will largely depend on the structure of the acquisition itself,” Oliver wrote. “In a share sale, for example, whilst the employing company will now be in the hands of the acquiring entity, there will not normally be any change of employer and (at least in the short-term) the company’s daily operations and working structure will typically remain the same.”

He added: “In a business or asset sale, on the other hand, the seller’s employees generally transfer to the buyer under the 2006 Transfer of Undertakings (Protection of Employment) Regulations (TUPE).”

“TUPE requires that affected employees (or their representatives) are informed about the transfer and, in some cases, consulted about its impact on the employees,” Oliver explained. “This process can be quite involved and time-consuming and employers can face substantial penalties if they fail to follow the correct process, so founders and senior employees should factor this into the timeline for the deal.”

Read the full article.



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