If there is a change of employer, European Union (EU) legislation states that employees' contracts of employment must transfer to the new employer unchanged.
A change of employer might occur when:
- an undertaking - part of an undertaking - is sold
- there is a service provision change, ie a contract to provide a service is moved from one service provider to another
Both the old employer ('transferor') and new employer ('transferee') have certain rights and obligations under the legislation.
- the transferor must pass on to the transferee certain information about the staff to be transferred
- both the transferor and transferee must inform and consult employee representatives from each businesses about the transfer
This area of the law can be complex. In addition, each member state has implemented the EU law into its own legislation, so there may be local variations.
Therefore, if you are thinking of buying all or part of a business in another EU member state, you should always get advice in that member state.
You can get advice on the specific laws in any EU country using the Enterprise Europe Network (EEN). This is a network of business advice partner organisations across the EU. Find your nearest partner organisation.
Important: This information is still current but could change as a result of the withdrawal of the UK from the European Union. Any changes will be documented here. For more information, see Brexit support for employers.