If myemployer was bought and is moving to another state, do I still have to pay back relocation expensesif I leave the company?

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If myemployer was bought and is moving to another state, do I still have to pay back relocation expensesif I leave the company?

I signed a relocation agreement with a company to pay back all relocation expenses if I left within first 2 years of employment. The company was sold in first month I started and is moving their location to another state. Can I voluntarily leave the company now without having to pay back any relocation? Do I need to wait until they give me an end date? Is contract I signed void?

Asked on July 13, 2011 under Employment Labor Law, Illinois

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

1) The contract is probably not void--generally, when a company buys another, it buys that company subject to existing contracts and obligations. That's not to say that it *can't* be void--it's possible, for example, to buy a company's assets without taking over contracts or buying the company (i.e. the corporation or LLC) itself--but it's more likely that the contract is still in force.

2) For a definitive answer, you need to carefully read the terms of the contract/agreement itself--those terms will control. If you're in doubt, have a lawyer help you. Usually in agreements like this, if you leave voluntarily--even if you know that the business will be closing, moving, etc. in the near future--you have violated the agreement and repay the relocation expenses. You may need to wait until the company officially moves and discontinues your employment at this location, which would be termination or, even if they offered to relocate you again, constructive termination. If/when the company ends the relationship, then the employee usually does not need to repay; but again, you should review the contract and ideally consult with an attorney to be sure.


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