What Are an Employee's Rights in a Company Buy-out?

When a company buy-out occurs, it can be a confusing time for all involved. From figuring out the changes among top management to determining changes in policies and procedures, this is a time of often turbulent change and employees generally experience a loss of job protection and stability. However, employees caught up a company buy-out have certain rights of which they should be aware.

Contract Fulfillment

You have the right to review your employment contract to try to save your job. If you have a contract with your employer, depending on the specifics of it, you may be able to avoid a lay-off if your contract specifically states that you must retain your position, even in the event of a merger or buy-out. However, this language must be pretty specific in your employment contract because if it's not, then the new incoming company may say that your employment contract is null and void because it said nothing to address the circumstances of a buy-out.

Severance Package

You may also have the right to a severance package, depending on the policies of your employer. If the policy of the employer is to provide a severance package to laid-off employees that were let go due to circumstances not in their control, then a buy-out may give you the right to access this same lay-off benefit. Follow up with your human resources representative to determine what, if any, rights you have to a severance.


If your rights as an employee are violated during a company buy-out, you might first try to talk to management at the new company. They may not have been aware of your employment contract or were unaware of your company's policies regarding lay-offs. Consult also with a labor attorney to determine what your rights are and how to ensure they are being respected during the buy-out.


If your company is undergoing a buy-out, then you can take a few steps to ensure that you don't have to exercise your rights regarding your contract or severance pay. For example, seek out opportunities to stand out from the rest of the group in your job responsibilities and be extra helpful to incoming management staff. Be as straightforward and welcoming as possible to make yourself attractive to the new company.

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