How to Deal with Employment Termination due to this
"Indirect" Acquisition?
It commonly happens that a change of control, or more commonly
called an 'acquisition', of a company is followed by
employment terminations. This situation raises 2 (two) practical
issues: (1) who is entitled to ask for a
termination: the company as the employer or the employees?
(2) what about if the acquisition takes
place at the level of the shareholders of the company; is the
termination of the company's employees still allowed?
The basic provision regarding terminations of employment is set
out in Article 163 of Law No. 13 of 2003 concerning Manpower
("Manpower Law"), which states as
follow:
- The employer may terminate the
employment of an employee in the event of a change of status of the
company, merger, consolidation, or change in the
ownership of the company if the employee is not
willing to continue with the employment, and the employee
will be entitled to severance pay 1
