Employee Rights and Protections during Corporate Restructuring

Abstract

The corporate reconstruction is a complete financial aspect involving transfer of assets, liabilities, obligations, capital, share-holding, management and workforce too. A question arises as to the transfer of workforce, they being a part of the company and the company as a separate entity are co-dependent. The transfer of an employee is treated just like the transfer of assets, them being individuals they aren’t given much importance and a provided with minimal rights such as compensation and notice of transfer. Are such limited rights valid as India is a valid state, or it should try and protect the employees in a more comprehensive way? The U. K. and the U. S. A., relevantly provide certain set of rights, but Canada just like India have very limited rights to protect the interests of employees during the reconstruction of a company. Legislatively, India lack a comprehensive protection of employees but the discretion is with the judiciary to decide on the fairness of a scheme of reconstruction. The judiciary has to be pro-active enough to protect the interests of the working class of a company if the scheme of arrangement is taking away the rights of the workmen. The workmen appear before the court if they consider that the scheme is violating their rights.