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Personality and Social Psychology Bulletin, Vol. 27, No. 3, 267-280 (2001)
DOI: 10.1177/0146167201273001
© 2001 Society for Personality and Social Psychology, Inc.

Employee Adjustment to an Organizational Merger: An Intergroup Perspective

Deborah J. Terry

The University of Queensland, deborah{at}psy.uq.edu.au

Craig J. Carey

The University of Queensland

Victor J. Callan

The University of Queensland

Adopting an intergroup perspective, the research was designed to examine predictors of employee responses to an organizational merger. Data were collected from 465 fleet staff employed in a newly merged airline company. As predicted from social identity theory, the negative effects of the merger were most marked for employees of the low-status premerger organization. Also, as predicted, the perception of permeable intergroup boundaries in the new organization was associated positively with identification with the new organization and both job-related and person-related outcomes among employees of the low-status premerger organization but negatively with person-related outcomes among employees of the high-status premerger organization. As predicted, there was some evidence that the main and interactive effects involving status, perceived permeability, and intergroup contact on employee adjustment were mediated through strength of identification with the new organization.


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