Determining Successor Liability After An Asset Acquisition

Squire Patton Boggs attorneys consider the question of how a company that takes on employees after an acquisition determines if there could be successor liability for conduct that occurred before the closing. Successor liability may come into play with regard to numerous statutes, including the Employee Retirement Income Security Act (ERISA), COBRA, OSHA, various wage and discrimination statutes, and other employment statutes, including WARN, the FMLA and the Immigration Reform and Control Act, as well as various successor-in-interest  rules that apply under state workers’ compensation and unemployment compensation statutes. It happens, however, that a small number of criteria are a good starting point for determining successor liability for all of these. One must look, for example, at whether or not there is substantial continuity of business operations, including the facilities and the workforce itself.