Ask HR: What Options Do Employees Have During a Merger?

By Johnny C. Taylor, Jr., SHRM-SCP September 1, 2023

SHRM President and Chief Executive Officer Johnny C. Taylor, Jr., SHRM-SCP, is answering HR questions as part of a series for USA Today. 

Do you have an HR or work-related question you'd like him to answer? Submit it here.


After struggling financially for two years, my company recently announced a merger. There are duplicate operations between the two companies, and they told us this may mean staffing cuts at some point. They offered buyouts to employees in certain departments. Does this signal that our department is targeted for layoffs? What should I consider in taking a cash buyout? —Sasha 

Johnny C. Taylor, Jr.: It's hard to say whether your department would be affected without knowing the specifics of your company's merger. However, if it is, there are several things to consider before you take a cash buyout, often referred to as severance pay. Your employer appears to be at the initial stages of this merger, and a lot of work goes on behind the scenes to ensure the impact on the workforce and operations is as insignificant as possible.

However, sometimes overlapping staff members do need to be let go. Severance pay is a benefit many employers offer when involuntarily terminating an employee to assist with their transition out of the organization. Pay amounts can vary, with most employers having a severance plan that pays a fixed benefit amount.

An example may be one or two weeks of pay based on each year of an employee's service. Information on this pay would be included in a severance agreement and release of claims. This agreement and release outline the terms and conditions associated with this payment. You will have time to review and consider this information before signing the agreement. 

Before signing, there are some specific things to consider: 

  • Review the agreement with an attorney to ensure all your rights are protected. 
  • Determine what is happening to your benefits. Some employers may offer to pay for all or a portion of your benefits after employment ends.
  • Check for noncompete and nonsolicitation clauses, which may limit future job opportunities. 
  • Find out if you will be eligible for unemployment benefits. Depending on the state you work in, payment through a severance agreement may impact your unemployment eligibility or reduce the amount you receive. 

In addition, discuss the possibility of company-provided outplacement assistance (including assistance with resume preparation, interviewing skills coaching, etc.). This is a huge benefit that a departing employee should request to help with their transition.

Communication during this time of change is especially critical. Don't hesitate to bring any questions to your supervisor or your human resources representative. Amass as much information and perspective as possible so you can make the best decision for your career in the short and long term.

If an owner of a company is going on vacation and closing the office, can he force employees to use their own PTO time? Jess 

Johnny C. Taylor, Jr.: While it may not be a popular decision, in most cases, your employer can force you to use your paid-time-off (PTO) time if the office is closed, even if it's because the owner is going on vacation.

Currently, federal and state governments do not directly regulate PTO policy or require employers to provide PTO to employees. It is primarily up to employers to determine how and when employees use PTO unless it overlaps with other agreements or regulations.

For instance, an employer may have a policy or collective bargaining agreement (for unionized employees) to address PTO.

Another exception may come into play when employers tie sick leave and PTO together. Some states mandate paid sick leave. Most state sick-leave laws allow employees to use sick leave at their discretion, rather than forcing them to use it. Some sick-leave regulations allow employers to use their existing PTO policy to satisfy the sick-leave requirements. If your employer has used its PTO policy to fulfill state-mandated sick-leave requirements, they may be unable to force you to take PTO. These stipulations are essentially designed to protect workers' sick leave. There are mandatory paid-sick-leave laws for workers in Arizona, California, Colorado, Connecticut, Maryland, Massachusetts, Michigan, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont and Washington state, as well as Washington, D.C.

If you don't have a separate sick-leave policy and you work in one of the states mentioned (or in Washington, D.C.), it may be worth reaching out to your HR department if you are concerned about being forced to use PTO and if doing so might impact your ability to use PTO for sick leave in the future.



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