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What happens to vacation time on the books during an acquisition?

HR727HR727 1 Post
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Anyone out there with experience going through an acquisiton? I am specifically interested in what happens to the ee's vacation time that is on the books...does the seller pay it out, does the buyer carry it on to their books, or is it all contigent on the sales agreement?
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  • GenoGeno 184 Posts
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    HR727,

    Yes.



    Geno, SPHR
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  • KathyHRKathyHR 97 Posts
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    When I was in banking & went through an acquisition we paid out anything above what our vacation allowed, put their remaining vacation on the books and then everyone was within the vacation policy. Seniority was based on the starting date of whichever company they were at, they didn't have to start over with us.
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  • marcmarc 3,126 Posts
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    All of the things you listed are possible, but, in my opinion, it boils down to the way the company is being acquired. If the buyer is only buying assets, then all liabilities - including payroll related liabilities - are only assumed if the buyer agrees to do so.

    If the stock is being purchased, then the whole company goes, assets and liabilities, including the payroll related ones, are part of the package.

    There are some successor in interest factors that can come into play, the lawyers should help you with respect to determining when those factors apply.
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