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How can businesses protect staff in a merger?

On Behalf of | Jan 23, 2025 | Business Law

The prospect of a merger can be exciting, as you stand on the cusp of a potentially great leap forward. You’ll have so much to think about at this time, with checking figures and drawing up legal documents,  that it is easy to forget about your staff. Yet they are likely one of the keys to your current and future success.

Mergers often necessitate job losses, even though they are taken to create positive growth. This is because you have two sets of staff and likely do not need to double up on every position. Your staff will be only too aware of this, so if you want to keep people, you’ll need to be proactive. Otherwise, you could find the proactive ones among them have already made other plans.

Note that it can be challenging to keep the news of a merger quiet, so gossip can quickly spread through the workplace even before you have confirmed the merger will go ahead. Headhunting agencies may come knocking on the door of your best staff, and other businesses who get wind of the merger on the grapevine might also approach them..

Stop the doubt

If you want to ensure that someone is still with you after the merger, you need to let them know early on that they are part of your plans. The more information you can give them about how they will fit into the new scheme, how their salary and responsibilities will be affected and other such issues, the better. However loyal to you they are, they have themselves and their families to think about, so cannot afford to be uncertain about their futures for long.

There are legal issues to be aware of when ending, altering or renewing contracts, so appropriate guidance may be wise.