has either received or is waiving their right to obtain independent
legal advice.
Finally, if there are any terms from a previous contract that the
employer wishes to import into this agreement, then the agreement
should be clear to indicate which clauses are new and which clauses
from the previous agreement continue to remain in force. Furthermore,
if an employer is introducing a termination clause for the first time, the
employer should be reasonable and not expect that an existing employ-ee
with no prior termination clause limiting their entitlements would
agree to and now be bound by a termination clause that limits their en-titlements
to statutory minimums.
KEY TERMS IN A SALE OF BUSINESS SCENARIO
First and foremost, any employment contract being provided to an em-ployee
in the context of the sale of business must stipulate that the offer
of employment is conditional upon completion of the sale. If the con-tract
does not contain such a term and the sale does not go through,
can you imagine the messy situation the prospective purchaser would
find itself in? The prospective buyer could be saddled with many new
employees and no work for them to do since the acquisition did not ac-tually
take place.
employment contracts
Also, employers making offers of employment in this context should
be explicit about any new terms and conditions of employment so that
employees can understand the difference between the job and the
terms and conditions they had with the vendor versus the job and the
terms and conditions that are being offered to them by the purchaser.
Lastly, unless certain statutory exemptions apply, the purchaser of a
company will be required to recognize the employee’s original start date
– that is, inherit their seniority – for certain purposes. An employer is
not permitted to contract out of the provisions of the legislation, which
mandate the continuity of employment and therefore the assumption
of years of service for statutory purposes. Therefore, the employment
contract should not treat the first day of employment with the pur-chaser
as the first day of employment for all purposes.
No matter what the context, employment contracts are documents
necessary to record the terms and conditions agreed upon between an
employer and an employee. However, employment agreements need
not be long and cumbersome, but they do need to be appropriate to the
circumstance and carefully and clearly written. n
Patrizia Piccolo is a partner and the employment law group head at
Rubin Thomlinson, LLP.
THE TERMINATION
CLAUSE HAS THE
POTENTIAL TO BE
HOTLY LITIGATED IF
IT HAS NOT BEEN
PROPERLY DRAFTED.
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