Sun Life to buy Dialogue Health Technologies for $277M: Employee rights

Sun Life is acquiring Dialogue Health Technologies for $277 million. The insurance company’s acquisition of the Montreal-based virtual care provider occurs as many Canadians struggle to schedule same-day or next-day appointments with a doctor.

The details: Sun Life’s purchase of Dialogue Health is expected to close in the fourth quarter of 2023, following shareholder and regulatory approvals.

• Dialogue Health’s executive management team will keep a minority interest in the company.
• Dialogue Health will exist as a standalone entity owned by Sun Life Canada, and will continue to maintain its head office in Montreal
• Sun Life will pay Dialogue Health shareholders $5.15 in cash per common share as part of the deal.
• The total equity value of Dialogue Health is $365 million.

More information: Dialogue Health was founded in 2016 as an app that books video appointments between health professionals and Canadian patients. The concept became more popular during the COVID-19 pandemic.

• Dialogue Health claims that it services approximately 2.8 million members through 50,000 organizations.
• Sun Life became a minority owner of Dialogue in 2020 through a $32.7-million equity investment, with rights to acquire additional equity in the future.
• Sun Life began offering Dialogue Health’s services to its Group Benefits clients through Lumino Health Virtual Care.
• Dialogue’s services are available to clients in the United States.
• National Bank Financial acted as financial advisor to Sun Life during negotiations, while RBC Capital Markets advised Sun Life.

What they’re saying: Jacques Goulet, president of Sun Life, said that Dialogue Health’s platform can be used to “reduce the strain on our healthcare system.”

• “The need for digital health services has never been greater. Nearly 50 percent of Canadians are saying they can’t schedule [timely appointments], and the acquisition of Dialogue by Sunlife means the opportunity to participate, to help fill that gap to give Canadians the solution they need to live their healthiest life,” said Dave Jones, president of Sun Life Health.
• Jean-Nicolas Guillemette, COO of Dialogue, said that the company is seeing the rising challenges of the health-care system, and that employers understand the importance of investing in the well-being of their employees.

Who pays severance if Sun Life doesn’t want to keep some Dialogue Health employees?

If the sale of Dialogue Health to Sun Life results in you losing your job, then Dialogue Health 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.

If you do receive an employment offer from Sun Life, and have a good reason for why you don’t want to accept it (i.e. different hours or pay), you may still get full severance pay from Dialogue Health.

Even without a good reason you can still get severance, but you would likely 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

Can Sun Life make changes to Dialogue Health employees’ jobs?

Non-unionized employees at Dialogue Health don’t have to accept major changes to their job that Sun Life might try to enforce.

Large modifications such as a demotion, cut in pay, reduction in hours, or negative change to commission are illegal.

When the terms of your employment are significantly changed, the law allows you to resign from your job and seek full severance pay through a constructive dismissal claim.

READ MORE
• Do I get severance if I quit?
• RBC long-term disability claim denials in Ontario
• Sun Life reinstates LTD coverage after legal action

New employment contracts for Dialogue Health employees

If you are a Dialogue Health employee, don’t accept a new employment contract from Sun Life before having it reviewed by an employment lawyer at Samfiru Tumarkin LLP.

Employment contracts often take away protections that would otherwise be available to you, including:

• Eliminating past service: A 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.
• Termination clause: A new owner could use this 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 or let go.
• Ability to make changes: A new employer might try to work in an agreement that allows them to change aspects of your job (i.e. duties and pay) without your permission or lay you off without any penalty.

Your employer can’t force you to sign a new employment agreement, especially one that diminishes your rights.

SEE ALSO
• Telus buys LifeWorks for $2.9B: Employee rights
• RBC to buy HSBC Canada for $13.5B
• Apotex sold to SK Capital: Employee rights

Termination agreements for Dialogue Health employees

Non-unionized employees and senior executives at Dialogue Health are owed full severance pay when they lose their jobs due to downsizing or corporate restructuring.

Severance can be as much as 24 months’ pay, depending on a number of factors.

LEARN MORE
• Severance for provincially regulated employees
• Severance packages in mass layoffs

WATCH: Employment lawyer Lior Samfiru explains why you are still owed severance if you have been downsized on an episode of the Employment Law Show.

Before you accept any severance offer, have an experienced employment lawyer at Samfiru Tumarkin LLP review it and your employment contract.

We can tell you if what you have been provided is fair and how to get proper severance if it falls short of what you are actually owed.

If you don’t receive the full amount, which happens often, you have been wrongfully dismissed and are entitled to compensation.