Confessions of a benefits manager: Candid grapples with a potential acquisition


We’re buying a company. I can’t imagine why; it is not even in the same industry group and we couldn’t share any clients, so what is the sense in that? The Higher Beings move in mysterious ways sometimes. I bet I’ll be working on providing data for selling it again within a year, but meanwhile I’ve been asked to sign a confidentiality agreement so I can be part of the due-diligence team. Lovely.

The new company has offices in Belgium and Zurich, but we are being sent to a data room set up in Milton Keynes. I wouldn’t mind if I got asked to review policies in Barbados or Cancun, but Milton Keynes? Honestly.

The data room is in one of those small industrial units where all the offices look the same. In fact, everything in Milton Keynes looks the same. Roundabout after roundabout, office park after office park, it is like some sort of physical groundhog day. Worse, because the data room has been set up in a disused office building, there are no facilities. None. No coffee, no water machine, and absolutely no food. I even have to go to the company reception next door to use a toilet. I should be getting hardship pay for this assignment; it is practically a third-world country.

The team includes people from all departments, but is headed up by Gary, the acquisition guru. He has a giant spreadsheet with all the things we are supposed to be checking. You would think all the data to review would be provided digitally, but no, the company for sale has provided a veritable mountain of paper in the form of hanging files. They are all beautifully sorted and labelled alphabetically, but they are still paper. Boxes and boxes of paper.

Missing employment contracts

Over 20 boxes of hanging files cover the HR documents alone. Along with a John, a helper from Smarmy Consulting, I get started. I am soon quite depressed. Of the first 20 things on Gary’s list, I have found only two: employee contracts and a list of employees.

Checking the contracts against the list, there are 20 missing. I run my eye over the contracts we do have. Each one is unique. Some people have a termination clause; others do not even seem to have a notice period. I am supposed to complete an estimate of termination costs, but that is going to be rather tricky without any actual data. I start making a list of what I need on a giant spreadsheet of my own.

Pension scheme documents

Next, John and I take a look at the pension plan documents. Thankfully, it is a defined contribution (DC) plan, but nevertheless it is a frighteningly complicated one, with multiple sections, differing contribution rates, and a variety of additional voluntary contribution (AVC) providers. All that for 50 employees? I focus on ticking off the deliverables on Gary’s list and leave it to John to analyse the pension implications for the acquisition.

I look up and realise that only John and I are left in the building. John has taken out a packed lunch. I guess he’s been to Milton Keynes before. I have to drive around 100 identical roundabouts before finding a petrol station to buy a stale-looking egg sandwich. The rest of the team comes back later in smelling faintly of beer and onions. Thanks for inviting us along, guys.

John and I dig into the insurance policies. Again, it is hardly one size fits all, but rather one policy per individual. I’ve had to create a new spreadsheet showing the benefit entitlement by individual, because there doesn’t seem to be any noticeable consistency. I am intrigued by a Miss D on the list, although she has a fairly lowly job title, she seems to have the best of all benefit plans as well as a special bonus. Who is this mystery Miss D, and why is she so well rewarded?  I take a look back at her employment agreement. She even has a new agreement with a special termination clause giving a year’s notice. Curious.

Uncovering pay and grading scales

I’ve been asked to comment on the grading structure and pay scales. As far as I can see, it does not have any. That will make it easy to integrate with our own structure, but it will add a whole communication exercise. In my experience, people who have grown up using grades are perfectly comfortable with them. Others who have pay scales thrust upon them can get strangely emotional about it.

I give Gary a list of the missing data, and he makes an appointment with someone from the company to come and go through it. I don’t want to meet them, I just want to fill in my spreadsheet and go home, but that doesn’t seem to be an option.

The woman teeters in on high heels and causes all the men on the team to look up from their files. Guess who. Miss D. We go into a room in the back where we won’t be disturbed. Where the guys won’t be disturbed either. Miss D, it emerges, is the company administrator, and she does everything from facilities management to payroll. She is also the MD’s girlfriend. Aha. We go through the list and she offers to deliver another set of files by the end of the week. Is there any chance of getting any of it digitally, I ask? I so want to leave this place.

At the end of the week there is a feedback meeting with all the due diligence teams. Nobody has anything good to say about the potential new company and there seem to be many insurmountable legal issues. I am cheered because my overwhelming wish is that we don’t buy it. To harmonise all those plans is going to create a miserable workload for me.

A month later, I hear we have bought it. Sigh.

Next time…Candid sorts out the department budget.