This is the point mentioned in my agreement regarding acquisitions, but I cannot understand this clearly. Does this mean I'll be forced to continue my agreement with acquired company, or can I relieve from this agreement and leave my job? I have 1 year of agreement remaining.

In the event that my employment is transferred by X, to a subsidiary or affiliated company,My employment with such company will, for the purpose of this agreement, be considered as continued employment by X, unless and until I execute an agreement, substantially similar in substance to this agreement, then in force in any such company for which I become employed.

X is my company name.


The mere fact that X has been bought by another company doesn't have any effect on your employment agreement; the contract is with X, not with 'whoever the current owners of X may be'.

However, usually if Y company buys X it is for the purpose of integrating X into Y, so that, say, the manufacturing section becomes 'XY (a division of Y)', the marketing department becomes a local office of Y marketing, and the personnel department are quietly dismissed. The assumption for this clause (either earlier in the agreement or automatically under the relevant code) is that your employment agreement can be transferred by the new owners; if you are in manufacturing you will continue to do the same job for XY as you did for X, and if in marketing you are now a marketing creative for Y. This clause merely formalises the transfer; your job with XY will be the same as it was with X, and this will last until you sign a new agreement or this agreement expires. If you are in marketing presumably the job you do will have to change, but the terms of employment (pay and conditions, for example) remain the same; again, until either you agree to a contract with Y or the expiry of this agreement.

It is not clear what happens if you are in personnel and the new owners of X do not wish to transfer your employment; presumably that is dealt with elsewhere (though from your question I infer that you would be happy to go your own way).

  • Thanks for the clarification. My company is asking me to sign in a new agreement with the new company,Is it mandatory for me to sign? They want me to resign from X company and join Y. Do i have to? – Vegeta Feb 27 '17 at 12:47
  • That is completely off-topic, since you are asking for specific legal advice. You are bound by the agreement you have already signed; ask a lawyer what that entails if you want to quit your job. – Tim Lymington Feb 27 '17 at 12:56

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