Follow these tips to help you tell employees that your company is closing, and to do it with as little stress as possible: Let employees know the business is closing before they read about it. In the end, every company ever sold has lost some employees. If the CEO has narcissistic personality disorder, the company will be in trouble at some point, even if it's not at the moment. If the sale involves selling shares, employment may remain largely unchanged. Should that occur, you have two choices. By Ney Grant | In: Getting Started. The issue of what you tell your employees when you’re trying to sell your business is a tricky one that requires careful thought. This is true regardless of whether you are a unionized or non-unionized employee. From letter of intent to closing it took about six months and during that time I let the employees know what was happening. Roughly 30% of employees are deemed redundant when firms in the same industry merge. It is much better to wait until you have a transaction near completion. If your company’s brand is very serious, it probably doesn’t make sense to open the letter up with “Hey dude…”. Telling your staff you are thinking of selling may feel like the right thing to do, but in the end, keeping them in the dark may be the best thing for you and your employees. After all, it presents a change in their routine. If you have a contract with your employer, depending on the specifics of it, you may be able to avoid a lay-off if your contract specifically states that you must retain your position, even in the event of a merger or buy-out. In a share purchase, the key fact is that your employer does not actually change - just who owns the employer. Very often employees are afraid to tell their boss, so you'll need to be persistent or innovative in your approach. Don’t let your preoccupation with the sale blind you to what the troops are saying. You can spread that as far as you … Here are some steps to take to ensure your team … Never tell your employees that you're unhappy with them as a group. I have been involved in billion dollar mergers that take up to a year to settle out. Decide on the outcome you want. By telling your employees too early that you are considering selling, you may stir up fears they may have about the future. If you work for a business that is sold, and you lose your job without proper notice or pay, or if you lose any rights or pay, it may be considered wrongful dismissal, and you may be able to sue both the former and the new employer. Only you know what’s truly right for you and your company. Surprises are OK if it’s your birthday, but finding out through the grapevine that you no longer have a job isn’t ideal, and reading about it in the morning paper stinks. Once you’ve found a serious buyer and have outlined the terms of the sale, you can begin telling your biggest clients. What happens to employees of an acquired company really depends on the type of acquisition it is. If you want to destroy trust on your team, the best way to do it is by gossiping about your own employees. These employees should be people you trust not to spread the word of the sale just yet. If you decide not to tell your employees that the business is being sold, you don't have to tell them anything – unless someone finds out on their own. There is help available to laid-off workers from the government, in the form of unemployment compensation. SHARE THIS ARTICLE. The acquiring company has a real interest in keeping productive employees. However, moving is a big step not only for you, but for your employees as well. John Warrillow Tell your employees why you're selling the company. Your employment is continuous – your service is not broken by the transfer. Some might fear the worst and begin looking for another job. How to Tell Your Employees That Change Is Coming: 13 Tips If you do it right, a candid conversation about change can inspire and motivate your team. This includes express and implied terms. I started and grew a technology company in the late 1990s, and sold it after being approached by a larger, public company. Be careful to only tell key employees in your company first. Good communication is key to ensure that this period of change is easier for both yourself and your employees. On the other hand, if you go too formal with the salutation it will seem impersonal. You may wish to talk to your employees directly and explain the situation. As a business owner you’ll want to maximise value in your business when you sell it. It's natural for employees to panic slightly at the news; they might think the worst and that their jobs are likely to go up in smoke. Also great places to listen for rumors and to squash the scuttlebutt that can infect employee morale the worst begin. 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