Mergers and Acquisitions

Ogletree Deakins helps clients navigate the labor, employment, employee benefits, and executive compensation dimensions of acquisitions, divestitures, mergers, restructurings, and other strategic transactions. Clients need a deal partner that can tailor diligence to the transaction structure, workforce profile, jurisdictions, and materiality thresholds; identify and quantify employment-related liabilities; and translate findings into practical deal terms, closing actions, and post-closing integration plans. Our attorneys have assisted clients of all sizes across a wide range of industries, including private equity, technology, manufacturing, retail, hospitality, financial services, and more.

Our capabilities extend beyond U.S. borders. In today’s global economy, many corporate transactions involve employees in more than one jurisdiction. Members of our Cross-Borders Practice Group have years of experience helping companies in all aspects of their global transactions. Our attorneys provide a unique integrated service, in coordination with a network of select foreign jurisdiction local counsel as appropriate, that recognizes the material issues and business drivers of a transaction, as well as the practical considerations in getting a deal done while complying with the nuances of local laws. Our team is led by former in-house lawyers with extensive experience in corporate development who not only understand the employment law issues in divestitures, asset purchases, stock transactions, and mergers but who also have multidisciplinary experience that adds strategic value to the entire transaction.

Because our approach is integrated and practical, we often handle the employment law aspects of transactions in partnership with corporate counsel, deal teams, investment bankers, consultants, and other advisors. We help clients gather the right information, assess compliance and liability issues, identify impediments to closing or integration, and communicate findings in the format that best supports the transaction. Our advice is tailored to each client’s situation, providing a strategic approach to accomplishing the client’s business objectives while also aiming to avoid potential business disruptions and promote a smooth transition.

Our Services

Our multidisciplinary teams and U.S. and international offices regularly counsel businesses around the world with respect to:

Typical labor, employment, employee benefits, and executive compensation issues arising during mergers and acquisitions, including:

• Identifying the actual costs of successor employment relationships arising from contracts, collective bargaining agreements, and local laws, as well as advising on a strategic approach to new employment terms for onboarding employees

• Assessing and reviewing multi-employer pension plans for unfunded liability exposure and strategies for avoiding withdrawal liability and analyzing multi-employer health and retirement plan contribution history to ensure compliance.

• Reviewing employee benefit and compensation arrangements, including qualified and nonqualified retirement plans, health and welfare plans, fringe benefits, severance, change-in-control, equity, incentive, and bonus arrangements
• Integrating existing employee benefits plans, analyzing the impact of benefits continuation issues if plans are extinguished, and advising on how to avoid triggering unplanned obligations
• Reviewing individual employment, offer, retention, consulting, special compensation, restrictive covenant, arbitration, indemnification, and change-in-control agreements, including the potential acceleration of equity or profit interests
• Evaluating bankruptcy issues and their impact on the rights and liabilities of employees, the target company, and the purchaser
• Assessing WARN Act and state or local plant-closing, mass-layoff, or severance notice obligations
• Assessing reduction-in-force planning, disparate impact, discrimination, harassment, retaliation, accommodation, protected leave, pay equity, pay transparency, and wage disclosure issues
• Analyzing confidentiality, non-solicitation, non-compete, invention assignment, and other restrictive covenant issues, including enforceability and transaction-related continuity
• Assessing pending, threatened, or historical employment litigation, administrative proceedings, government audits, grievances, arbitrations, internal complaints, workplace culture concerns, and other claims or investigations discovered during due diligence
• Reviewing HR policies and practices, compensation and payroll/timekeeping systems, wage and hour compliance, workplace safety, privacy, monitoring, biometrics, automated decision tools, and HR data security to assess actual and potential liabilities
• Evaluating pay practices and payroll tax issues, including exempt/non-exempt classification, overtime, meal and rest periods, wage statements, pay timing, expense reimbursement, fringe benefits, Forms W-2/1099, and payroll reporting
• Assessing immigration and employment eligibility issues, including I-9 compliance, E-Verify participation, work authorization, visa sponsorship, and agency audits involving employees affected by an acquisition or merger
• Evaluating worker classification and contingent workforce issues, including independent contractors, temporary workers, staffing agency relationships, PEO/EOR arrangements, interns, volunteers, gig workers, joint employment, and co-employment risk
• Determining employee rights under laws relating to the transfers of businesses and practical solutions to addressing conflicting business interests, including analyzing Transfer of Undertakings (Protection of Employment) Regulations (TUPE) obligations and other aspects of employment rights under local country laws
• Reviewing the seller entity’s compliance with global labor and employment laws applicable to the purchaser, including Foreign Corrupt Practices Act diligence, global wage and hour and workplace safety laws, privacy obligations, and discrimination and harassment laws
• Analyzing employee rights under existing global employment contracts and policies to determine whether, and to what degree, a transaction will trigger potential undisclosed costs
• Correcting global misclassified agency and contingent worker relationships for workers affected by the transaction
• Addressing the impact of a transaction on corporate officers and similar positions at a parent and any subsidiary companies throughout the group organization
• Assessing the impact of the parties’ failure to comply with global labor and employment obligations on the overall transaction price, as well as providing strategic solutions to resolve these issues

Transaction document and deal term support, including:

• Employment-related representations and warranties, covenants, conditions, disclosure schedules, closing deliverables, and onboarding/key employee obligations
• Indemnities, escrows, holdbacks, purchase price adjustments, and other mechanisms for allocating employment-related liabilities
• Disclosure schedule support tied to identified employment, benefits, immigration, privacy, and labor issues
• Representation and warranty insurance protection

Post-close integration and remediation support, including:

• Developing pre-closing remediation, closing action, and post-closing integration workstreams that address identified diligence findings and promote transparency, trust, and productivity with the acquired workforce
• Creating or updating employment, retention, consulting, restrictive covenant, equity incentive, bonus, commission, severance, and other compensation arrangements
• Analyzing termination practices, reduction-in-force plans, accrued leave payouts, severance obligations, and WARN or similar notice requirements
• Harmonizing benefits, compensation, pay equity, HR policies, workplace culture, immigration, communications, and change-management strategies
• Implementing or updating policies and procedures covering wage and hour, leave and accommodations, privacy and data security, AI and automated decision tools, employee monitoring, biometrics, workplace safety, and complaint reporting
• Supporting workforce integration across legal entities, jurisdictions, employee populations, and work arrangements to promote a smooth transition

Mergers and Acquisitions Practice Group Leaders

Todd C. Duffield

Kevin J. Kinney