A number of different parties and interests are at play in any
merger. Although it may not be at the forefront during merger
negotiations and considerations, the acquiring company should turn
its mind to the possibility of mass terminations, and the
consequences flowing from them. Comparatively speaking, the
Canadian employment framework is quite generous, and there is no
employment at will.
Commonly, an acquiring company will identify and seek to reduce
redundancies and inefficiencies in the post-merger entity. Prior to
instituting mass terminations, companies must consider their legal
obligations to the terminated employees.
If the employees of a target company are unionized, section 69
of Ontario's Labour Relations Act, 1995 deems the
acquiring company to be a successor employer. As such, if all or a
part of a business or undertaking is sold, leased, transferred, or
otherwise disposed of, the purchasing business, as successor,
becomes bound by the collective
