The Essential HR Guide to Your First Merger

Mergers and acquisitions are an excellent way for organizations to achieve rapid growth, open up new markets or expand their product offerings. However, fast-growth strategies come with many human resources challenges that can severely impact the success of the merger if not handled correctly.

Use this merger guide to ensure things go smoothly as your organization goes through a transitional period:

Communication is key. Mergers are complicated even in the best scenarios, but communication is the best tool to pave the way for success. In a post-merger environment, employees are uncertain and rumors will abound. While letting people go or changing their roles may be unavoidable, clear communication will help reduce the rumor churn and prevent a negative environment from developing.

Your communication plan might include:

  • Leveraging multiple forms and frequencies of communication. Include one-on-one meetings, group sessions, newsletters, intranet updates and emails.
  • Providing opportunities for employee involvement and feedback.
  • Ensuring that employees understand there will be changes, but communicate the company’s commitment to articulating those changes as early as possible.

Put employees first whenever possible. Employees at all levels of the organization will experience uncertainty regarding their pay, service time, benefits, location and job title when a merger is taking place. Consider the ramifications on your organization as a whole when you make changes in these areas.

Consider outsourcing when needed. Post-merger organizations have the complex task of combining and/or defining how benefit plans, defined contribution plans, vesting and more will shake out after the merger. Valuation of liabilities and overfunding or underfunding of plans can be too complex for your current staff to handle. In addition, health care, payroll processing and workers’ compensation may need a full assessment. In many cases, the post-merger company will tap an expert like a PEO (professional employer organization) to assist them in these complicated HR matters.

Assess, avoid and reduce liability. From new state boundaries to international offices, mergers can bring in a whole new set of employment laws. If not addressed accurately and in a timely manner, these types of regulations could expose your organization to risks and fines.

Cultural fit needs nurturing. Hopefully you considered the fit of the cultures of the two merging companies pre-merger, but either way, it’s important to nurture it along in these early days.

Focusing on team-building and collaboration will help ensure that cultural synergies develop.

This merger guide serves as an outline to assist you in navigating the complex human resources landscape as you merge two entities into one thriving business. As part of your strategic plan, a professional employer organization can help make the pre- and post-merger process go more smoothly.

Oasis Outsourcing offers deep expertise in developing and supporting benefits and payroll administration, compliance-related requirements and a comprehensive communication plan to keep all employees in-the-know. Partnering with an expert to help with your HR services can help make your merger a success.


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