The Short Answer: Your Rights During a Business Sale
In Alberta, if your employer sells the business, you are either transferred to the new owner with your years of service intact, or you are terminated and owed full severance pay.
The law generally prevents “resetting” your seniority. If a new owner asks you to sign a contract that ignores your past years of work, you may be facing a constructive dismissal.
Is the new owner asking you to sign a new contract?
Do not sign any new agreement that removes your “recognition of service.” Contact our Alberta team to verify if your severance rights are being protected.
On This Page:
Share Sale vs. Asset Sale
Notice to Employees
Do I have to accept the new job?
Severance Eligibility
Talk to an Alberta Lawyer
Share Sale vs. Asset Sale: Why It Matters
In Alberta, the way a business is sold determines what happens to the employees when a company is sold. There are two primary types of transactions:
- Share Sale: The buyer purchases the actual corporation. Legally, the employer does not change — only the owner of the company changes. Your employment continues exactly as it was, and your years of service are automatically protected.
- Asset Sale: The buyer only purchases the “assets” (equipment, clients, brand). Technically, your old employer no longer needs you, and the new owner is under no obligation to hire you. If they do hire you, it is considered a transfer of employees from one company to another.
Notice to Employees When Selling a Business
Employers in Alberta are required to provide notice to employees when selling a business if that sale will result in terminations. If you are not being kept on by the new owner, your current employer must provide you with legal notice or pay in lieu of notice (Alberta severance pay).
Do I Have to Accept a Job If My Company is Sold to New Owners?
Technically, no — you can’t be forced to work for a new employer. However, your right to severance pay depends on whether the new offer is considered “comparable employment.”
- If the offer is comparable: (similar pay, role, and location) and you refuse it, you may be seen as having “mitigated” your losses, which could disqualify you from a severance claim.
- If the offer is NOT comparable: (lower pay, different title, or much longer commute), you may be able to refuse the job and still claim a termination without cause due to sale of business against your original employer.
Company Sold: Severance Pay and EI
If your employment ends because of a sale, you are entitled to full severance pay under common law. This can be as much as 24 months’ pay. Additionally, if the business is sold, can you collect unemployment? Yes — as long as you haven’t turned down a comparable job offer, you are typically eligible for EI benefits.
Contact an Alberta Business Sale Lawyer
If your company is changing hands, don’t leave your future to chance. The Alberta employment law team at Samfiru Tumarkin LLP can review your new employment contract and ensure your years of service are protected.