Archive for October, 2009
Your rights if you’re fired or made redundant
It happens. You wake up one morning to find out your company’s being acquired. Your first thought: will I be able to keep my job.
You do have some legal rights. There’s differences between being fired (also called ‘dismissal’) and your position being made redundant. In most mergers or acquisitions, what’s happening is that many (sometimes up to one-third of all) jobs will disappear when the two companies combine. The company no longer needs everyone. Two payroll departments become one, two salesforces become one … and the same throughout the organisation where there is any overlap between the two formerly-separate companies.
The book Surviving M&A contains an entire chapter on this topic, covering issues such as your rights to protection against unfair selection, the requirement to consult with you (or your representatives, if you are a member of a union) and to provide you with some sort of redundancy pay, which is often specified at a minimum level in law. The book also covers the role of the Human Resources department in this process and how managers usually determine who to keep and who to fire.
There’s also a nice on-line article that has appeared on-line recently with some of the telephone numbers to call and some of the legal jargon explained: ‘Redundancy Rights: Your rights when being made redundant‘. This is a UK-specific site, so may be of limited use to those outside the United Kingdom. There’s another one on UK redundancy rules at PrudentMinds. For those in the US, Fortune and CNN Money have covered this well in ‘Life after Redundancy‘.
Read Full Post | Make a Comment ( None so far )Hostile Deals: Caveat Emptor
In a related blog, I’ve commented on hostile deals. Why? There’s been a lot of press on this topic because of last month’s $19 billion unsolicited (hostile) offer for Cadbury by Kraft. Certainly, as I note in that blog, the deal has had so much attention not just because it’s hostile, but it’s also all about chocolate!
The facts about hostile and unsolicited deal: first, there aren’t many of them (in fact, only about 1% of all announced deals are either hostile or unsolicited). Secondly, only 40% of those ever do get completed. As there’s fewer than 100 hostile or unsolicited bids in an average year recently, that means only 40 complete (although admittedly a very small number of those targets that do escape nevertheless end up being purchased by somoene else eventually). Not huge numbers. But you certainly don’t want to be in one of those companies if the deal does complete, or even in one of the 100 that receives a bid.
When a hostile deal is successful, it’s bad news for the employees and management of the company that’s been taken over. A greater percentage of employees in a hostile target are made redundant than when a deal is friendly. There’s less chance to negotiate before the deal completes to maintain your position in the company — or even to negotiate ANY position. And very often the hostile bidder wants the company only for its assets, which is why they were willing to initiate a hostile deal in the first place because they didn’t care whether they antagonised the employees or not.
Another reason to focus immediately on your survival when you hear that your company may be the target of a hostile bidder!
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Surviving M&A 