Maintenance of subjective health during a merger: the role of experienced change and pre-merger social support at work in white- and blue-collar workers

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Abstract

Prospective research on psychosocial effects on employees’ health associated with organizational mergers has been scarce. The first aim of this study was to explore the subjective health effects (exhaustion and functional incapacity) of an organizational merger among employees who had experienced a change in their own job position differently (improved, unaltered, and declined). Secondly, the effects of pre-merger social support (organizational, supervisor, and coworkers) at work on the experienced change in job position and on subjective health were examined. The merger took place in 1999 between two multinational firms of equal size. The study is based on two surveys (n=2,225) carried out in 1996 and in 2000 in the Finnish part of the company. The data on age, sex, pre-merger sickness absence (1996–98) and subjective health status (1996) were used as covariates. The results indicate that all sources of social support had a significant effect on the experience of change in one's job position. A decline in job position strongly increased the risk of poor subjective health after the merger. Weak organizational support was associated with impaired subjective health, especially in blue-collar workers, while weak supervisor support impaired functional capacity in white-collar workers. In turn, strong co-workers’ support increased the risk of poor subjective health among blue-collar workers when their job position declined. We conclude that negative changes experienced in one's job position and lack of upper-level social support at work create a potential risk for health impairment in different employee groups in merging enterprises.

Introduction

In order to survive and succeed in modern business life, companies have to cope with technological changes, international competition, the opening up of new markets, and cuts in expenses. In the face of these challenges, companies often have to grow in size via mergers and acquisitions. In an acquisition, a large company obtains the ownership of a smaller firm and gains clear control over the other (Lohrum, 1996). A ‘merger’, on the other hand, refers to an amalgamation of two companies (Hogan & Overmyer-Day, 1994). Amalgamations are globally increasingly common in the private sector.

While the primary goals in mergers are economic, they may have a considerable impact on employees’ psychosocial working conditions. However, the bulk of the literature on mergers has focused on the financial and strategic aspects (Datta, 1991), whereas psychosocial studies on mergers and their health-related consequences are lacking (Begley, 1998; Hogan & Overmyer-Day, 1994). In the present study, mergers are viewed from the employees’ perspective as an organizational change process, which influences the tasks and positions of the employees and requires psychosocial capacities, as do other important organizational changes.

A merger can change work in many ways: the nature of the job itself can change, as can the person's role in the organization, the human relations at work, and the career advancement of those involved (Cartwright & Cooper, 1997). A negatively experienced change can be defined as a potential stressor that threatens to exceed the adaptive resources of the individual (Monat & Lazarus, 1985). Therefore, these kinds of changes may have negative effects on the well-being and health of the employees (Brockner, Grover, Reed, & DeWitt, 1992; Terry, Callan, & Sartori, 1996), for example, through job loss, reduced status, threats to self-esteem, and interpersonal conflicts at home and at work (Schweiger & Ivancevich, 1985), and feelings of uncertainty and anxiety (Buono & Bowditch, 1989). The changes during a merger can nevertheless be positive for the employees, for instance, by improving the quality of work (Felderman & Emmerling, 1997), and by offering opportunities for increased decision latitude (see Jackson, 1992). These work-related resources have been found to be potential protectors against health risks (e.g. Vahtera, Kivimäki, Pentti, & Theorell, 2000). Thus, mergers may have a double-edged role from the employees’ perspective, because the merger-related experiences may threaten the health of some workers by causing stressors, but they may also enhance the health of those who experience improvement in their work-related resources. However, past research does not indicate whether there is an association between improved or declined job position and subsequent health in the context of the merger or not.

Numerous studies suggest that employees at different levels of the organizational structure may experience the changes differently. This may associate with their health impairment during organizational upheavals. For example, Hunsaker and Coombs (1988) reported that, during a merger, white-collar workers at higher levels in the organization experienced less distress than employees at the lower levels (see also Hardey, 1998). By contrast, various studies have also indicated that white-collar workers who are usually responsible for carrying out the changes during an organizational transformation are especially at risk of experiencing an increased level of stress at work (Hogan & Overmyer-Day, 1994; Srivastava, Hagtvet, & Sen, 1994). It can be also argued that the symbolic value of the job itself often differs between white- and blue-collar workers. Compared to blue-collar occupations, the work in white-collar occupations is often viewed as part of self-realization in life (e.g. Shapira & Griffith, 1990). In line with this, changes in one's job position may particularly affect the subsequent health of white-collar workers.

In the present investigation, we explored the impact of differently experienced changes in job position during a merger, i.e. a potentially stressful period of changes on the health of white- and blue-collar workers. We used the terms ‘declined position’, ‘unaltered position’, and ‘improved position’ to refer to the overall experience and evaluation of an employee regarding promotion or demotion of his/her job position during the period of the merger. Our first hypothesis was that declined job position increases the risk for poor post-merger subjective health.

Various sources of social support have been regarded as critical resources of successful coping by the workers (e.g. Hobfoll, Lilly, & Jackson, 1992). It is plausible that, during the merger, employees higher in the organizational hierarchy have better opportunities to obtain information about the change process and to receive important support, and to use this information and support to protect or even improve their own position during an organizational change. Social network research suggests that network support promotes career optimism at upper levels of the organizational hierarchy (Friedman, Kane, & Cornfield, 1998) and that individuals with high social status jobs benefit from their social contacts in finding better jobs (Wegener, 1991). Studies on career development have generally shown the beneficial role of strong social relations in career progress (e.g. Flum, 2001). Prior research, however, has not explored whether workers differ from each other in their capacity to cope with the change and improve their job position due to their pre-merger resources of social support, and whether this effect differs between white- and blue-collar workers. The second hypothesis was that, during a merger, social support is positively associated with the experience of an improved job position.

Psychosocial theories on stressors and ill health (e.g. Karasek & Theorell, 1990) have suggested that social support also provides a major resource for health by reducing the feeling of threat and thus increasing the manageability and the controllability of the situation (Terry et al., 1996). Basically, two types of relations between social support and workplace health have been proposed. Most studies have shown that work-related social support has a direct effect on stress reactions and on health (e.g. Moyle, 1998; Niedhammer, Goldberg, Leclerc, Bugel, & David, 1998), but buffering effects have also been noted (e.g. Buunk, 1990; Cohen & Wills, 1985; Vahtera, Pentti, & Uutela, 1996). In the context of a merger, the ‘stress-buffering hypothesis’ means that support may lessen the negative impact of declined job position or other stressors upon health (Shaw, Fields, Thacker, & Fisher, 1993). However, results on the health-buffering effects of social support have been mixed and not very promising from the perspective of a merger. For example, in a longitudinal study by Dekker and Schaufeli (1995) support from colleagues, the management and trade unions did not have any buffering effects against negative organizational changes.

The impact of social support on health among people facing changes at work may depend on the source of support. Cross-sectional studies have indicated that in organizational changes supervisors’ support has more impact than coworkers’ support, because it potentially provides more resources to deal with situational demands such as changes in one's tasks (Terry et al., 1996). Coworkers’ support may have a limited impact in a merger process, because colleagues may feel emotionally upset for the same reason (Begley, 1998) or such support may increase negative emotions via rumors and misinformation (Buunk, 1990; Terry et al., 1996). Support from the organization, such as giving direct and honest information and opportunities for participation, may be an essential source of social coping when a person is experiencing a merger (Schweiger, Ivancevich, & Power, 1987). Lack of organizational support may increase uncertainty (Bastien, 1987), which, in turn, may contribute to the development of psychological distress and other undesired health effects (Dekker & Schaufeli, 1995).

In this study, our operationalization of coworkers’ and supervisor's support assessed mainly belonging, appraisal, and instrumental support, whereas organizational support assessed the level of communication, honesty, and information flow from the upper levels of the organization to the employees. We assumed, in line with some previous studies, that these particular types of support may have a positive effect on employee health (Hogan & Overmyer-Day, 1994; House, 1981; Unden, 1996). The third hypothesis was that pre-merger supervisor and organizational support would have a direct positive impact on post-merger subjective health. Finally, we explored whether support from the three sources decreased the effects of declined position on subjective health. No stress-buffering hypothesis was formulated because of mixed findings in the past.

We examined two aspects of subjective health: exhaustion and functional incapacity. Exhaustion has become a widely employed indicator of prolonged mental strain at work in occupational health psychology (e.g., Geurts, Rutte, & Peeters, 1999). It has been recently shown to be associated with increasingly stressful working conditions in a ‘normal’ organizational context (Demerouti, Bakker, Nachreiner, & Schaufeli, 2001). Functional incapacity was used as an indicator of self-rated ‘fitness for one's job’. This type of functional capacity has been proven to be a good predictor of subsequent work ability in prospective research (Tuomi, Huuhtanen, Nykyri, & Ilmarinen, 2001). Its decline may even lead to decisions concerning work ability, if the impairment impedes one's essential job functions (Colledge, Johns, & Thomas, 1999). Using these subjective indicators of health, the study investigated white- and blue-collar workers who had experienced differently changes in their own job position during the merger, and who had received different levels of social support at work prior to the merger. Here it should be borne in mind that most of the earlier findings on the impact of mergers on health have been obtained using cross-sectional study designs, small homogenous samples, and without proper baseline health controls. Therefore, it has not been possible to draw any conclusions on the prospective relations between pre-merger social support and post-merger health among employees representing different socioeconomic statuses.

Section snippets

Participants and procedure

We collected the data in three phases, twice before a merger and once after. In 1996 (T1), we conducted a company-wide survey on work and well-being in a Finnish industrial company operating in several countries. Altogether, 9705 Finnish employees participated in this phase (response rate 63%). These data provided the information on pre-merger social support and pre-merger subjective health status for the present study.

In the second phase (1996–98, T2), preceding the merger announcement, data

Descriptive results

Blue- and white-collar workers differed significantly from each other in terms of subjective health (both exhaustion and functional incapacity) before and after the merger (t-test result). White-collar workers experienced more exhaustion, whereas blue-collar workers experienced more functional incapacity. Blue-collar workers had nearly twice as many sick leaves as white-collar workers prior to the merger. The sources of social support prior to the merger varied between the groups. White-collar

Discussion

Our study focused on organizational merger from the employees’ perspective. We found that experienced change in job position and the level of social support from different sources varied somewhat according to employee status. Generally, white-collar workers experienced more negative changes in their job position during the 2-year period after the merger announcement. However, they were also likely to benefit more from the merger in terms of improved position at work, and to have more

Acknowledgements

The study was supported by the University of Tampere, the Academy of Finland (projects #36281, #54585, and #77560), the Finnish Work Environment Fund (project #100014), the Finnish Work Health Development Foundation, the Finnish Institute of Occupational Health, and Stora Enso Oyj.

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