“Don’t make the mistake of loving your company.
It will never love you back.”
– CEO of Reinsurance Firm
(recently laid off following merger)
ACTUAL CASE HISTORY*: I left my last law firm employment about 25 years ago. I left because I just didn’t see the law firm having much of a future. The reason was that younger partners were not permitted to bring in their own clients. Instead, they were assured that they would “inherit” the significant clients of the law firm when they became senior partners, just as the then-senior partners had done. It didn’t make sense to me, and I didn’t trust it. That was one of the major reasons I left to form my own firm.
At that time, many New York law firms were merging with one another, and consolidating with other law firms in other cities and countries, to form “mega-law firms” with offices in all major cities around the world. At the time I left it, my law firm was engaged in exploratory discussions with several other law firms, in what was then a literal wave of law firm consolidations. This is precisely what has happened – and is happening now – in many industries, from banking, to real estate, to media, to healthcare. Time after time, there have been waves of mergers and sales, each forming larger and larger institutional employers.
About a year after I left my old law firm, the partners had a large meeting. The “Merger Negotiating Committee,” as they were called, had an important announcement to make. From what I was told by three people who attended that meeting, this was the gist of the announcement made by the Merger Negotiating Committee:
“Ladies and gentlemen, we have great news: In thirty days, our law firm will be merging with one of the most prestigious law firms in the world. We will have offices in nineteen cities. The major clients of our firm have been consulted, and they are all in agreement with our decision to merge. In fact, all of our major clients have encouraged us to make this move. Perhaps most importantly, each of our firm’s 25 largest clients has agreed to become a client of the new merged firm.”
“Also, all of the necessary arrangements have been made, financial, legal and even with our present landlord. All of the agreements have been negotiated and signed. Everything has been attended to, and has been finalized.”
“As to specifics, of the 84 partners of our firm, only the six members of the Merger Negotiating Committee will become partners of the merged firm. Of the 214 associate attorneys of our firm, 26 have been selected to become associate attorneys with the merged firm. Those partners who are not becoming partners of the merged firm, and those associate attorneys who were not selected to become associate attorneys of the merged firm, will need to remove their belongings from our offices within ten days.”
“We thank all of you for your years of dedication, effort and loyalty.”
78 of the partners out of 84 were effectively terminated. 188 of the 214 associate attorneys also were effectively terminated. Worse still, they were all left without clients, without offices, and without warning. All were left asking themselves, “Where is the great news?”
I am reluctant to say it, but I couldn’t understand why they all didn’t see it coming. Even way back then, I’d never seen a law firm that needed two “heads” of litigation, two “Senior Partners of labor law,” or two heads of Human Resources. Have you?
LESSON TO LEARN: If you have any reason to expect that your employer may be seeking to merge or be sold to a competitor, you have reason for concern. And, too, you have reason to start taking steps to protect yourself.
On a sinking ship, do you wait until you feel the water at your ankles before you put on your life preserver jacket? In a burning building, do you wait until you feel the heat of the fire on your fingers before you seek a safe exit? So, why would you wait to take precautions if you had reason to believe a merger or sale of your employer was underway? Only two possible reasons, neither of them smart: fear and denial.
That’s not good enough. If you want to “survive” the layoffs and “restructurings” that inevitably follow mergers and sales of companies, you need to take action. Below are the fifteen steps we counsel our clients to take – and the ones they have taken to their best advantage.
WHAT YOU CAN DO:
A. Personal Matters / Planning
1. Make a Plan of Action: Though you may not have begun to assemble necessary information, the earlier you begin to prepare some sort of plan to get yourself through a possible merger or sale of your employer, the better. Start with three categories of things to consider, and then start assembling sub-categories, and then specific data. We suggest you start off with three overall categories of matters you’ll need to address: (a) Financial; (b) Career; and (c) Health. Planning helps focus your thoughts, direct your actions, and control your emotions. Sure, you can always redraft or adapt your original plan of action, but without a plan of some sort, you’ll have nothing to adapt when you start to make progress.
2. Begin with the Goal in Mind: As Yogi Berra said, “If you don’t know where you want to go, you might not know if you get there,” or words to that effect. Where might you want to be in five or 10 years: same job? retired? new career? different locale, or even a different country? It sure helps you plan your future steps if you keep in mind where you would like to go. Remember that Michael Bloomberg, NYC’s Mayor, took best advantage of his layoff and used his severance package to start his own company.
3. Get a Grip on Income and Outflow: There are two important aspects to this: (a) knowing your income and outflow, and (b) being more careful about them, for now. How much do you need to pay bills and take care of necessities? How long would your available liquid resources last without your salary? Do you have parents or in-laws who can help out in a jam, or are these same people dependent on you? This would be a good time to reconsider unnecessary purchases, such as a vacation home. This might even be a great time to refinance your mortgage, as you would not be able to do that if you lost your job.
B. Legal and Benefit Matters
4. Assemble and Review Your Documents: Now would be a very good time to review those important documents that simply bore you. Do you have an employment contract? What does your stock option plan say about layoffs? Can you continue your disability insurance if you lose your job? How about commissions from recent large sales; do you get them if you are laid off? The answers to these and other questions can be found in your job-related documents. Assemble them, ask HR for any you don’t have, and read them over carefully.
5. Do you have any “Legal Claims” against your Employer?: Have you been passed over for promotion six times, and younger people given the opportunities? Did you fail to get a bonus the year you gave birth? Was your career hurt because you reported wrongdoing? If you have any of these concerns, you should consider (a) gathering emails and any other evidence that you might want to have an attorney review, and (b) if appropriate, filing a claim at this time. Though many different factors go into a decision regarding whether to file a claim of discrimination, harassment or retaliation, each of which must be carefully weighed, this might be a good time to do so, or at the least, gathering information or documentation so that you can do so later, if you decide to.
6. Now is a good time for a thorough Employment Law “Check Up”: As the two preceding sections indicate, this may be a wise time to invest the time and money into a thorough “legal checkup” by an experienced employment attorney. Just make sure he or she is not an attorney whose first inclination is to “sue.” Rather, you would be best served by an employment attorney who is not interested in taking you into court, but to guide you in “navigation and negotiation.” An attorney experienced in assisting employees in transitions may be able to spot problems or opportunities that you were not aware of.
C. Relations / Networking
7. Identify, Enhance and Promote your Unique Human Capital (“U.H.C.”): Each of us offers something special to our employers, partners, clients and customers – it’s what we are paid for. Special skills, insights, relations, even dependability, that makes others want to associate with us, affiliate with us, even pay us money. What’s your “U.H.C.?” It may not be the same U.H.C. that you were hired for, because people’s needs change over time. It’s always important to consider what makes you considered valuable to others. At times like this, it’s especially important to focus on that, enhance that, and make sure others are aware of it.
8. Rekindle Valuable Relations/Networks: You’ve no doubt heard the old saying “Make new friends, but keep the old. One is silver and the other is gold.” The same thing goes for workplace and business relations. Now is an especially opportune time to renew potentially valuable relations, rekindle friendships both internal and external to your job, maybe even rejoin professional or trade associations.
9. Fold Your Parachute – Resume and Recruiters: Though it may not be time to seek employment elsewhere, it’s surely time to prepare yourself to do so, just in case it becomes necessary. Update your resume, spend time learning about the “connected” recruiters in your field, and assemble samples of your work, what some people call “portfolio material.”
D. Leverage / Taking Action
10. Take Stock of your “Positional Leverage”: Sometimes, you’re just in the right place at the wrong time. Sometimes it’s just the opposite. That’s what we call “positional leverage.” In most companies, some people’s daily function is at the heart of the company’s business, often called “mission critical”; this makes people more likely to survive a merger or sale of their employer. On the other hand, those whose functions are more of a support function are more likely to be job insecure in such events. And there are gradations of “positional leverage”: a person who supports a mission-critical person may, himself or herself, be deemed “mission critical,” as well. Your degree of “positional leverage” may determine your chances of keeping your job, and may help you decide what to do if the merger or sale does take place.
11. Get Close to your “P.P.O.P.P.’s”: No, it’s not Father’s Day. “P.P.O.P.P.’s” are “People or Pockets of Profit or Power.” They are the people in your organization who make the decisions about what bonus you get, whether you are promoted, if you will keep your job, and, if not, how much notice or severance you will be offered. She may be the Divisional President. He may be the Managing Director of Asset Management. She may be the Creative Director. You may have two, three or four “P.P.O.P.P.’s.” You need to think about who your P.P.O.P.P.’s are, and take steps and measures to have positive contact with them. Let your P.P.O.P.P.’s know of your Unique Human Capital, and how it is valuable to them.
12. You might consider requesting Retention Assurances and/or Commitments: Depending on many different factors, including your positional leverage and your relation(s) with significant “P.P.O.P.P.’s,” you might request – in respectful fashion – assurances or even commitments of job retention. In perhaps a majority of company mergers and sales, top people are offered retention agreements and retention bonuses to ensure they stay put. That’s to discourage their “folding their parachutes” and seeking appointments with recruiters. You might qualify for such an assurance and/or commitment.
13. Research the likely Merger Partner(s) or Acquirer(s): Don’t forget to spend time finding out all you can about your possible future employer. Are you a likely piece of their “puzzle?” Or are you an obvious “square peg” for their “round hole”? Most importantly, might you be able to “rebrand” yourself to be their ideal “cup of tea?” (Please excuse the analogies.) You may get a chance to explain “Why I would be a perfect person to keep.” Just in case, be 1,000% prepared.
E. Now Get Going
14. Purchase our Checklist, or Prepare Your Own: “Yard by yard, it’s very hard. But inch by inch, it’s a cinch.” It’s now time to “get going” on your plan of action, and to convert it into practical, concrete steps.
For your convenience, we have prepared our “88-Point Checklist for Facing Merger or Sale of Your Employer.” It can be purchased for a modest sum by simply [clicking here].
Of course, you are free to prepare your own. Either way, if you have reason to believe you are facing a potential merger or sale of your employer, it’s time to get going.
15. Take Steps to Reduce Stress: Facing uncertainty is always stressful. Uncertainty at work and especially regarding events outside of your control – is extremely stressful. Now is not the time to get sick, or to get into unnecessary spats, or even lash out at loved ones. It’s most important to find and follow steps that help you reduce your stress, whether it is prayer, meditation, yoga or just taking walks. So long as they are not destructive steps, such as alcohol or other intoxicants, make them a part of your daily routine. Truth be told, taking the first fourteen steps listed above will, in themselves, begin to reduce the stress of your heightened job insecurity.
When faced with a potential merger or sale of your employer, there are both perils and opportunities ahead of you. It’s not easy to tell the difference. Bear in mind that they may not be different; rather, it is you that may be most able to make them different, and to move toward opportunity. By not taking steps to avoid perils, you are effectively moving yourself in that direction.
Fortunately, there are many things you can do to help yourself. Here’s how.
SkloverWorkingWisdom™ emphasizes smart negotiating – and navigating – for yourself at work. Negotiation and navigation of work and career issues requires that you think “outside the box,” and avoid risks at every point in your career. Knowing ways to resolve disputes when they arise is a distinct advantage in navigating workplace life. Knowing ways to avoid disputes is even more advantageous. Learning the “in’s and out’s” of doing so is what we are here for. Now it’s up to you. Welcome to “SkloverWorkingWisdom.™”
Always be proactive. Always be creative. Always be persistent. Always be vigilant. And always do what you can to achieve for yourself, your family, and your career. Take all available steps to increase and secure employment “rewards” and eliminate or reduce employment “risks.” That’s what SkloverWorkingWisdom™ is all about.
*A note about our Actual Case Histories: In order to preserve client confidences, and protect client identities, we alter certain facts, including the name, age, gender, position, date, geographical location, and industry of our clients. The essential facts, the point illustrated and the lesson to be learned, remain actual.
Please Note: This Newsletter is not legal advice, but only an effort to provide generalized information about important topics related to employment and the law. Legal advice can only be rendered after formal retention of counsel, and must take into account the facts and circumstances of a particular case. Those in need of legal advice, counsel or representation should retain competent legal counsel licensed to practice law in their locale.
© 2010 Alan L. Sklover All Rights Reserved. Commercial Use Prohibited