Employees’ Rights in Case of a Transfer of Undertaking
When proceeding to the business transfer that involves the transfer of undertaking (one or more business units or parts of business units, i.e., organised means pursuing an economic activity) transferor and transferee must consult with employee representatives and provide relevant information on the planned transfer. The employee is entitled to maintain his job position previously held with the predecessor, with all existing terms and conditions, with the successor, once the transfer of the undertaking occurs.
Requirements for Predecessor and Successor Parties
Prior to transfer, employee representatives (Works Council and trade union representatives) or, in their absence, employees directly have to be informed in writing prior to the transfer about the transfer’s date, motives and legal, economic and social consequences, as well as measures envisaged in relation to the employees. Where there are employee representatives and special measures are put in place as result of the transfer, employee representatives have to be consulted prior to the transfer. These obligations encumber both the transferor and the transferee, in relation to their respective employees or their representatives.