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I received an acquisition proposal. Your employer wants to pay you a severance package. That’s a big change.
But quitting your job now means looking for a new job in a weakening job market.
Should I accept the offer?
Companies spend money in the short term to save money in the long term, and propose acquisitions to thin the company’s ranks.
Employers often use buyouts to avoid layoffs in uncertain economies. And that thought alone should give you pause.
This year, the Trump administration proposed a buyout of the entire federal workforce, aiming to cut jobs by up to 10%. It accepted approximately 75,000 workers. Recently, Amazon, UPS, and Target announced cuts to their private sector jobs.
Acquisitions may sound appealing. A five-figure severance package may be the most a worker has ever seen in a single paycheck. But it’s also the last paycheck your employer will give you.
“It’s like winning the lottery. Some people think their money will last longer than it actually does,” said Donna Walton, wealth strategist at TD Wealth.
When considering an acquisition, some considerations are universal. How much is my retirement allowance? Am I close to retirement? Did you want to quit the job anyway?
However, the current economic climate presents its own challenges.
Employers added just 22,000 jobs in August, according to the latest federal report. The unemployment rate rose to 4.3%, the highest level since October 2021.
Roughly 2 million Americans have been unemployed for more than six months, the highest number in more than two years, the Labor Department said in May. Companies are hiring less due to uncertainty over President Trump’s tariffs. Artificial intelligence is taking jobs away from new graduates. Recession fears are looming.
“The job market is very soft,” Michelle Evermore, a senior fellow at the National Academy of Social Insurance and a former Labor Department official in the Biden administration, told USA TODAY earlier this year. “I think people are holding on to their jobs because it’s a time of great economic uncertainty.”
Here are five tips for employees considering an acquisition in 2025.
Request a purchase
Let’s start by taking a positive step. Maybe your employer hasn’t offered to buy you out. But you’re restless about making changes and hear that the company wants to cut costs.
Consider contacting your manager and requesting an acquisition. In most cases, there is nothing to prevent your employer from creating a voluntary severance package just for you.
“You’re going to see this happen, especially when news breaks that companies are planning to downsize,” said Michael Scarpati, CEO of financial wellness platform RetireUS. “It’s kind of a win-win for both parties.”
If you request a buyout first, you may be able to receive a better severance package than what your employer ultimately offers everyone else.
But don’t ask for an acquisition if you’re not ready to do so.
“If they make you an offer, you have to be willing to leave,” Walton said. “That’s not a bluff.”
negotiate acquisition terms
A typical buyout might offer you four weeks’ pay, plus an additional week’s pay for each year you worked for the company. You may receive additional health insurance and may even be able to help you find a new job.
According to a report from AARP, about half of employees accept takeover offers without negotiating. However, there is nothing wrong with asking for better conditions.
“Think of it like going to a job interview,” Scarpati says.
You can also request a full year of severance pay instead of a few months. Perhaps your employer will cover the cost of your health insurance while you look for a new job.
Some workers are hiring lawyers to negotiate buyouts, said David John, senior strategic policy adviser at AARP’s Public Policy Institute.
While it may sound extreme, remember that acquisitions are business propositions. Contracts can be complex and may include non-disclosure agreements and non-compete clauses.
Even if you don’t bring a lawyer to the deal, Walton said, “you should at least meet with one.”
test the job market
Experts say that unless you plan to retire, you should assess your chances of finding another job before leaving your current one.
If you work in a field that is shrinking or in an area that has been hit economically, you may already know this.
“It’s one thing for someone who works at a think tank to get bought out in Washington, D.C., and a very different thing to get bought out if you work on an oil rig in South Dakota,” Evermore said.
Evermore said look at the Department of Labor’s employment report to find out how many people in your area have applied for unemployment insurance and how many remain on the benefits rolls.
Even better, apply for a few jobs. Check to see if you are bitten. If not, that might be a good sign that acquisitions aren’t for you.
In the best case scenario, you can arrange a new job before you get acquired.
Measuring the risk of dismissal
Many employers offer buyouts to avoid layoffs, or at least delay layoffs.
If there is an acquisition offer, consider the possibility that the company may resort to downsizing after the acquisition closes.
“Responsible companies will address these concerns immediately and give a yes or no answer,” AARP’s John said.
If you are likely to be fired, consider whether you might be placed on a redundancy list. Ask your manager if you are vulnerable.
If your company has experienced layoffs in the past, check to see what severance benefits those employees received.
In some cases, Walton said, the buyout package could be “the same thing the company would offer if they fired you in six months.”
please take it easy
Many federal employees who were bribed by the Trump administration had just weeks to make decisions.
Experts say that’s not long enough.
“If you’re asking someone to make a major life decision that might involve moving your entire family, it’s going to take at least a few months,” Evermore says.
Mr Scarpati said that ideally six weeks would be the “minimum” period for a takeover offer. 90 days is more reasonable.
Use that time to “think about where you are in your career,” Evermore says. Discuss your options with friends, colleagues, and loved ones. Test the job market. Ask yourself if you are ready to uproot your family and move across the country.
and run the numbers. If you’re mid-career, do you have enough emergency savings to get you through a period of unemployment? How will your health insurance cover you? How generous are unemployment benefits in your state?
If you’re nearing retirement: When did you expect to receive Social Security? How will you cover your health insurance until Medicare kicks in? Are you saving enough for retirement?
Consider consulting a financial planner.
“Ideally, you would have this financial plan in place before something like this happens,” Walton said.
