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Takeover troubles

Q. We are buying another firm, which has an employment tribunal pending. We wish to change staff hours and contract terms. Do we inherit the tribunal, and can we alter the terms?

If your purchase involves buying shares, and thereby control of the company, the transfer of undertaking regulations does not apply. However, because the firm continues to exist, the tribunal will still go ahead, even under your new ownership.

As for changing hours and terms, you can do so, even against the staff's wishes, if you have a good commercial reason. However, you must act reasonably, which means consultation and, as far as possible, taking on board problems. For example, if the hours change and some staff cannot get to work at the new time because of lack of public transport, you would have to make some allowance for that.

If you are buying the assets of the company rather than the shares, then almost certainly a transfer of undertakings will occur, making life somewhat difficult. The tribunal will still transfer to you, and you cannot change terms and conditions for a reason connected to the transfer. (Changing terms to bring them into line with your other companies is likely to be deemed such a reason.)

You are entitled to dismiss some staff if you have too many doing a particular task, but you have to be very careful, and it would be prudent to take professional advice.

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