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Business transfers and employer groups in the Dominican Republic: what a buyer inherits

Last verified: 2026-10-30 · Status: Stable

Selling a business or a branch moves all employment rights to the buyer, even pending lawsuits, and the buyer shares liability for past debts until the claims lapse. The sale must be reported within 72 hours to the union, staff and labor authority. Moving a worker between group companies to defeat rights is presumed fraud in key cases.

Key facts

Deadline to notify a business transfer	72 hoursLey 16-92 art. 65, as of 2026-10-30 · in force
Buyer's liability for pre closing labor debts	Joint until the claim expires textLey 16-92 art. 64, as of 2026-10-30 · in force

The rule

1. Transfer of a company, branch or unit, or of a worker to another company, passes all rights and duties under the contracts to the buyer, including those in pending suits, and never ends acquired rights.Ley 16-92, Código de Trabajo, art. 63, 1992-05-29 official text · verified 2026-10-30

2. The new employer is jointly liable with the former one for duties that arose before the change, until the claim expires.Ley 16-92, Código de Trabajo, art. 64, 1992-05-29 official text · verified 2026-10-30

3. The transfer must be notified to the union, the workers and the labor authority within 72 hours after the date. Missing this makes both jointly liable.Ley 16-92, Código de Trabajo, art. 65, 1992-05-29 official text · verified 2026-10-30

4. Relations between seller and buyer are outside the code, so any price adjustment or indemnity is a private contract matter.Ley 16-92, Código de Trabajo, art. 66, 1992-05-29 official text · verified 2026-10-30

5. A resignation is deemed not to exist when what really happened is a fraudulent transfer of the worker to another entity or employer. The code sets out presumptions of fraud in such cases.Ley 16-92, Código de Trabajo, art. 96, 1992-05-29 official text · verified 2026-10-30

6. Companies under common control or in an economic group are jointly liable for labor duties when fraudulent maneuvers occurred.Ley 16-92, Código de Trabajo, art. 13, 1992-05-29 official text · verified 2026-10-30

7. Claims run from the day after the contract ends, and rights arising more than a year before termination cannot be claimed.Ley 16-92, Código de Trabajo, art. 704, 1992-05-29 official text · verified 2026-10-30

8. TSS debts carry privileges under the law, and the TSS can record judicial mortgages and seizures to secure them.Ley 87-01 as amended, art. 116 and art. 214, 2001-05-09 official text · verified 2026-10-30

Deal type	Employer changes?	Labor effect
Share sale	No	Same employer continues, so the code's transfer rules are not triggered by the text
Asset or branch sale	Yes	Rights pass to the buyer under art. 63
Worker moved to a group company	Yes	Rights continue, and art. 96 presumptions can apply

Effect by deal structure

Worked example

A buyer takes over a restaurant with 40 staff. A worker sues over old overtime. Since art. 64 makes the buyer jointly liable, the purchase agreement needs a specific indemnity and an escrow.

Step by step

Run payroll, TSS, INFOTEP and DGT filing checks in diligence.
List pending suits and suspended or protected staff.
Decide on asset or share structure.
Notify within 72 hours.
Update SIRLA and SUIR records.
Put indemnities and escrow in the contract.

Common traps

The seller paying severance to staff and rehiring through the buyer can look like the fraud art. 96 targets.
The 72 hour clock runs from the transfer date, after closing, so build it into the closing checklist.
A worker's rights to seniority carry over, so cesantía grows with old service.

Sources

← Outsourcing and intermediaries in the Dominican Republic: when the client answers for the contractor's staffRemote work in the Dominican Republic: the 2020 telework resolutions →

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