Over the past four years, the legal landscape—particularly regarding employment matters—has shifted dramatically. From ever-changing standards for employment/contractor classification to the #MeToo movement, buyers and sellers have faced numerous and evolving challenges in structuring their M&A deals. The COVID-19 pandemic has also introduced additional unforeseen employment issues. Because these issues are also tied to the economic impact of the pandemic, we may see the claims continue until the economy rebounds.
Shareholder Rep Insights
As shareholder rep on more than 4,650 deals, the team at SRS Acquiom has had a unique opportunity to observe the impact of these changes on post-closing claims activity and deal terms. We’ve also formed perspectives on how buyers and sellers might adapt their deals going forward to better protect and advance the interest of all deal parties.
M&A Employment Challenges
In this article, we provide an overview of the legal and social changes that have impacted M&A employment challenges matters the most, specifically with regard to employee classification (both in and out of the “gig-economy” sector) and sexual harassment, and explore how both buyers and sellers have attempted to account for these new risks in their M&A deal terms. We also examine how COVID-19 has created yet another host of employment issues and highlight the claim trends we are seeing as a result. Finally, we offer experience-based insight into how both buyers and sellers might respond proactively to minimize risk and maximize outcomes on future deals.
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