What if an employee refuses to work for me after I buy the business?

Some employees will decline to move across when a business changes hands, and a buyer should expect it. The legal result depends on the province, on how your offer compares with the job they have now, and on whether you ever became their employer. Official guidance on refusals is thin outside British Columbia.

British Columbia: declining unchanged terms counts as quitting

The Employment Standards Branch says that when employees choose not to go to work for the purchaser and their conditions of employment have not been substantially changed by the sale, they are deemed to have quit, and neither seller nor purchaser must give notice or pay compensation. If the sale does make substantial, adverse changes, the director may treat that as a termination, and the purchaser would be responsible for the compensation.

Ontario: the rule starts when you hire the person

Ontario’s Employment Standards Act deems employment continuous if the purchaser employs an employee of the seller, and the ministry’s guide shows an employee who accepts the buyer’s offer keeping credit for past service. The statute does not say what a refusal means for the buyer. An employee hired only after a long enough gap loses that credit, a limit the statute sets in weeks.

Quebec: the relationship is maintained

The CNESST says that when a company changes owner the staff’s employment relationship is maintained as if no change had occurred. Its page does not address an employee who refuses, so a Quebec buyer should not assume the British Columbia rule applies.

Planning for the gap

• Make written offers on terms as close to the current ones as you can, since British Columbia ties the result to unchanged conditions.
• Ask the seller which employees have said they will not move, before closing rather than after.
• Say in the agreement who bears any termination cost if a refusal is later treated as a dismissal.