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Past research provides evidence that organizational identification is a key factor predicting employees’ behaviours during mergers and acquisitions. In particular, recent studies demonstrate that members of the subordinate merger partner, in contrast to the dominant group, often find it difficult to transfer their identification to the post-merger organization. To understand this difference between dominant and subordinate groups, we examined employees’ sense of projected continuity in the future. We argue that projected continuity mediates the differential relationships between pre-merger and post-merger identification and propose that pre-merger identification relates positively to projected continuity in the dominant group but negatively in the subordinate group. As a result, the overall relationship between pre- and post-merger identification should be reduced or eliminated in the subordinate compared with the dominant group. We tested our hypotheses in a survey (N = 492) distributed in a merger of two international pharmaceutical companies at the beginning of the post-merger integration and 15 months later. Results were consistent with our assumptions of a moderated mediation effect. We conclude that a key challenge in merger integration is to support high identifiers in the subordinate group in developing a projected continuity or a focus on ‘the bright tomorrow'.

Research shows that after layoffs, employees often report decreased commitment and performance which has been coined the survivor syndrome. However, the mechanisms underlying this effect remain underexplored. The purpose of the paper is to show that reduced organizational identification can serve as an explanation for the survivor syndrome. We conducted a laboratory experiment, in which participants work as a group of employees for another participant who acts as employer. In the course of the experiment, the employer decides whether one of his or her employees should be laid off or not. Mediation analysis supports a social identity-based explanation for the emergence of the survivor syndrome: downsizing causes lower identification with the employer which in turn relates to lower performance of employees.

We analyse whether a principal's decision to lay off an agent affects the performance of the surviving agents in a laboratory experiment. We find that agents reduce their performance by 43% as a response to the lay-off decision. Heterogeneity in principals' decisions can largely be explained by different beliefs about how agents react to lay-offs.

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