Privacy and M&A: should you be disclosing employee records in the data room?

Can I name my employees in the data room?

Employee due diligence is often a critical component of any M&A process. Such due diligence can be invaluable for several reasons:

• it helps a buyer in assessing the current employee entitlements and terms and how to address these in the deal mechanics;
• it provides insight into the management structure, helping to identify key players; and
• it contributes to the ongoing planning and strategy for the business.

As discussed in our article last week there are certain exemptions under the Privacy Act 1988 (Cth) for employers when they are handling employee data. So the question is, can employers make use of this exemption when disclosing information about employees to a potential buyer during due diligence?