Roark Capital to buy Subway for $9.6B: Employee rights

After announcing in February that it was exploring a potential sale, Subway could soon come under new management.

According to news outlets, including the Wall Street Journal, private equity firm Roark Capital, which owns Arby’s and Buffalo Wild Wings, is nearing a deal to buy the sandwich chain for approximately US$9.6 billion.

People familiar with the matter claim that a deal could be finalized this week.

“Subway does not intend to make any further public comment regarding the process until the transaction has been completed,” the company told Reuters in an emailed statement.

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Subway has approximately 37,000 restaurants in more than 100 countries, including Canada.

If Roark Capital’s acquisition of the sandwich chain gets the thumbs up, here are a few things that non-unionized employees in the country need to be aware of.

Who pays severance if Roark Capital doesn’t want to keep certain Subway employees?

If the sale of Subway to Roark Capital results in you losing your job, then Subway 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 Roark Capital 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 Subway.

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

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

• Age
• Length of service
• Position at the company
• 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 Roark Capital make major changes to the jobs of Subway employees?

Non-unionized employees at Subway don’t have to accept substantial changes to their job that Roark Capital 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
• Can my employer make changes to my job in Ontario?
• Job changes in Alberta: What employees need to know
• Changes to your employment in B.C.: Your rights

New employment contracts for Subway employees

If you are a non-unionized employee at Subway, and you receive a new employment contract from Roark Capital, 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 Ontario, Alberta, and B.C. 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.