During 2023, there were 39,603 mergers or acquisitions around the world. It wasn’t as high as in 2021 when there were 58,308 and almost 1,000 megadeals in the U.S. Each time there is a merger or acquisition, the rights of employees need to be closely examined. Companies don’t always make it clear, which leads employees to believe they’re unprotected. That’s not always the case.

Harvard Business Review found that about 3 out of 10 employees are deemed redundant and laid off during a merger or acquisition. Employees often feel there’s nothing they can do. It is what it is. Knowing your rights and setting your signs on growth rather than doom and gloom makes a difference.

Potential Changes and Implications

As stated, there are almost always layoffs during a merger or acquisition. One company purchases another struggling business, and cost-saving measures become part of the new owner’s strategy to thrive. Saving money often relies on trimming staff to the bare minimum.

A layoff doesn’t necessarily mean you’re out of a job. You might be able to transfer to a new role where your skills are useful. For example, if you’ve been operating a machine in a factory for 30 years, your knowledge and personal experience in that role could make you an excellent floor supervisor.

Your rights don’t get ignored. Typically, an assessment team comes in to assess each worker’s role within a company. As there’s a chance that you will make the cut, buckle down and do your job as well as you can. It’s stressful being closely monitored, but they need to determine what skill sets and work ethics you have that others don’t.

Understand At-Will Employment

Only one state in the U.S. doesn’t follow at-will employment rules. While Montana follows “good cause” rules, meaning employers must have a good reason for terminating employees, California and all other states use at-will rules. That means employers can terminate employees at any time for almost any reason.

We say “almost” because employers are still bound by federal and state employment laws. At will also doesn’t apply to jobs in the public sector. They must follow any collective bargaining agreement or employment contract. For example, a company couldn’t say that after the merger only employees younger than 40 will remain. That’s age discrimination.

Reading Your Employment Contract or Collective Bargaining Agreement

If you have an employment contract, make sure you carefully read the terms regarding layoffs or terminations. If you are released, make sure you’re aware of promises made covering things like severance pay and insurance coverage. A transfer to another department may be listed as the priority over layoffs, ask if you’re not offered that option.

Union workers have a collective bargaining agreement in place. Often, longevity is going to protect your role. The longer you’ve worked there, the higher your seniority, and most senior workers are the last to get laid off in that case. It’s not always the case though. Read up on what happens and how terminations proceed. You also want to know what pay is awarded if you are laid off in a merger or acquisition. Sometimes, a company offers additional pay if you agree to stay on for a certain number of months to train merging staff.

Know You Have Rights

States have laws regarding mass layoffs, and you should be aware of them. The California WARN Act requires companies with 75 or more employees to provide 60-day advance notice of a plant closure, layoff, or relocation that affects 50 or more employees in 30 days. You have two months of pay to prevent hardship while you look for a new job, if necessary.

If a company has 75 or more employees after the merger and fails to provide proper notice when laying off employees, there are penalties of up to $500 for each day the company violates the WARN Act.

WARN Act rules do not apply if the company’s workers do not work more than 20 hours per week or haven’t been employed for at least 6 of the past 12 months. If the company offers relocation to a site within reasonable commuting distance, the WARN Act is also no longer applicable.

One of the benefits of WARN notices is that it gives you time to find suitable employment if your role with the company is terminated. Many HR departments provide services to help you find another job or assist in finding and applying for training programs to advance into a new role.

A company cannot violate employment laws when deciding who goes and stays in a merger or acquisition. You’re protected against the following types of discrimination.

Age (40+)
Disability/Medical Condition
Gender
Genetic Information
Race, Color, National Origin
Religion
Sex (Includes Pregnancy and Childbirth)
Sexual Orientation
Status as a Protected Veteran

Suppose you notice that all of the terminated employees in a merger or acquisition were almost tenured. If there’s a clear pattern of everyone 50 or older being the only ones to lose their jobs, it suggests age discrimination. It’s worth getting together and seeking legal advice.

Another area where you’re protected is if you are a whistleblower. Retaliation isn’t allowed. Suppose you tell the assessment team about all of the unethical or illegal things you’ve seen your management team do. You learn you’re on the chopping block while someone with less experience and poor performance records stays on with the company.

You have to wonder why a less experienced, poor performer would keep his or her job. While it’s not the easiest situation to prove, there’s a chance your management team retaliated and had you cut from the employees who survived the cut. It’s time for a free consultation with an expert in California employment laws.

Consult With an Employment Attorney

A job termination during a merger or acquisition can be beneficial when it’s done legally and fairly. You could end up in a position that better uses your talents with better pay and more room for growth. Don’t take a layoff personally unless you believe there was wrong-doing in the decision process. At which point, gather as much evidence as you can and contact an attorney specializing in California WARN Act laws and job terminations.

At which point, reach out to Shegerian Conniff with your concerns. We’ll look over your layoff and determine if the job termination was handled legally. If not, our team offers advice to ensure you get treated fairly and legally as your job comes to an end.