Carbon Engineering acquired by Occidental Petroleum: Employee rights

Houston-based Occidental Petroleum is buying Canadian startup Carbon Engineering for US$1.1 billion. The acquisition by the Warren Buffett-backed oil producer comes as the company continues to expand its focus on pulling carbon from the planet’s atmosphere.

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More details: Occidental will pay the $1.1 billion in cash through three equal, annual payments, with the first to be made when the deal is closed.

• The transaction is expected to close before the end of 2023, and is still subject to Canadian and U.S. regulatory approval.
• Occidental has worked with Carbon Engineering the past four years, using its technology at Stratos, the company’s direct air capture (DAC) plant in Texas which is set to become the world’s largest by 2025.
• Carbon Engineering’s tech will also be used for Occidental’s planned King Ranch DAC hub in south Texas.
• Harvard University professor David Keith founded Carbon Engineering in Calgary in 2009. The company has developed methods to remove large amounts of carbon dioxide from the air so that it can be either buried or used in other ways.

What they’re saying: In a press release, Occidental President and CEO Vicki Hollub said that the two companies can “accelerate plans to globally deploy DAC technology at a climate-relevant scale and make DAC the preferred solution for businesses seeking to remove their hard-to-abate emissions.”

• “We expect the acquisition of Carbon Engineering to deliver our shareholders value through an improved drive for technology innovation and accelerated DAC cost reductions.”
• “We have always believed that global partnerships and cross-industry collaboration would be required to deploy DAC infrastructure at the scale required to make a climate-relevant impact,” said Carbon Engineering CEO Daniel Friedmann.

Who pays severance if Occidental doesn’t want to keep certain Carbon Engineering employees?

If the sale of Carbon Engineering to Occidental results in you losing your job, then Carbon Engineering must provide you with full severance pay.

In Canada, the seller of the business is responsible for providing proper compensation to staff who lose their job.

WATCH: Employment lawyer Lior Samfiru explains the rights workers have when their employer sells the business on an episode of the Employment Law Show.

If Occidental provides you with an employment offer, and you have a good reason for why you don’t want to accept it (i.e. different hours or pay), you might be able to get full severance pay from Carbon Engineering.

Even without a good reason you can still get severance, but it’s very likely that you will only receive your minimum entitlements.

LEARN MORE
• Rights to severance in Alberta when your employer sells the business
• Employer sold the business in B.C.? Know your rights to severance
• Sale of business in Ontario: Rights to severance

How is severance pay calculated?

Severance for non-unionized employees in Canada can be as much as 24 months’ pay.

This includes individuals working full-time, part-time, or hourly in Alberta, B.C., and Ontario.

The amount of compensation you are entitled to is calculated using several factors, including:

• Age
• Position at the company
• Length of service
• Ability to find new work

To figure out how much you could be owed, use our firm’s free Severance Pay Calculator. It has helped millions of Canadians determine their severance entitlements.

If your company doesn’t provide you with the correct amount, you have been wrongfully dismissed and should contact an experienced employment lawyer at Samfiru Tumarkin LLP immediately.

We regularly resolve wrongful dismissal claims and can help you secure proper severance.

LEARN MORE
• Rights to severance for provincially regulated employees
• Severance packages in mass layoffs
• Severance pay in a recession

Can Occidental make major changes to the jobs of Carbon Engineering employees?

Non-unionized employees at Carbon Engineering don’t have to accept substantial changes to their job that Occidental might try to enforce.

Major modifications, such as a demotion, longer shifts, or reduced pay, are illegal in Canada.

When significant adjustments are made to the terms of your employment without your consent, there is a very good chance that you can treat it as a constructive dismissal.

In this situation, the law allows you to quit your job and pursue full severance pay.

If you believe that you have been constructively dismissed, don’t resign before contacting our firm.

ADDITIONAL RESOURCES
• Job changes in Alberta: What employees need to know
• Changes to your employment in B.C.: Your rights
• Can my employer make changes to my job in Ontario?

New employment contracts for Carbon Engineering employees

If you are a non-unionized employee at Carbon Engineering, and you receive a new employment contract from Occidental, take the time to carefully review it before signing it.

In many cases, these agreements take away key protections that would otherwise be available to you, including:

• Eliminating past service: The new owner might attempt to reduce or eliminate your years of service with your previous employer. Don’t sacrifice your seniority. Length of service is a key factor when determining how much severance pay you are entitled to.
• Reducing severance pay: Some employers try to use a termination clause to reduce your severance entitlements to the bare minimum. Instead of months of pay, you might only receive a few weeks’ pay if you are fired without cause or let go.
• Ability to make changes: The new owner might attempt to add a clause that gives them the right to change aspects of your job (i.e. hours or pay) without your permission or lay you off without penalty.

Employers in Canada can’t legally force non-unionized workers to sign a new employment contract immediately or a few days after receiving it.

SEE ALSO
• Starting a new job? Here’s how an employment contract could limit your rights
• Employment Law Show: 5 things to know about employment contracts
• Employment Law Show: Things to never do before seeking legal counsel

Received a job offer? Speak with an employment lawyer

Before accepting a new employment contract, have the experienced employment law team at Samfiru Tumarkin LLP review the agreement to make sure your workplace rights are protected.

Our lawyers in Alberta, B.C., and Ontario have successfully represented tens of thousands of non-unionized individuals.

We can help you better understand the terms of the contract and advise you on how best to navigate the situation.