Takeda staffers accuse drugmaker of favoring Shire employees during merger

During a merger, one might suspect a buyer could favor its old employees over the newcomers. But that’s not what's happened at Takeda Korea as it folds in Shire, according to a labor union.

Since former Shire Korea CEO Moon Hee-seok took on the Takeda Korea CEO role, the reorganization process "has been in favor of Shire employees only," Takeda Korea’s labor union said, according to Korea Biomedical Review.

Original Takeda employees allegedly faced unfair changes in their roles and got different incentive plans during the integration, the union said.

For example, within the gastroenterology sales team, Takeda sales reps’ incentives are tied to sales performance, while the Shire members got their awards proportional to salary, according to a labor union member cited by the Korean newspaper. "Even if the two sides yield the same sales performance, Shire workers get higher incentives," the person said.

Meanwhile, "scores of" Takeda employees left the company, while no Shire workers exited, he reportedly said. In one case, an employee with Takeda couldn’t move to a position at another division even after receiving approval from human resources.

In its response to the newspaper, Takeda Korea denied the allegation. The "scores of" departures were all for personal reasons, Takeda said, adding that "there is no retiree caused by the merger and acquisition."

It also argued the approval from HR didn’t mean the application process was complete. "During the application process, we can consider many variants depending on business needs and the circumstances of the organization and individuals," the Korean operation said, as quoted by Korea Biomedical Review.

As for the different incentive systems, the union member said Takeda plans to keep them in place until the merger process is complete. Takeda, in its statement, said it expects to wrap up next year, and that it will review aligning the two companies’ systems later.

The brawl came just days after CFO Costa Saroukos told investors that there have been "minimal" changes to the 79% or so of positions Takeda has decided on. "We have also been listening closely to our employees throughout the integration," he said.

After its first employee survey since the deal close showed that "78% of employees believed that the combined company will better serve patients’ needs," the company started a follow-up survey in July, the CFO said on a conference call Wednesday.

Takeda is looking to cut 6% to 7% of the combined Takeda-Shire workforce, or about 3,600 employees, as it aims to save about $2 billion in costs by the end of 2021. In the quarter that ended in June, the Japanese pharma booked 36.7 billion yen ($344 million) of Shire integration costs, adding on top of the 59.6 billion yen it registered for the fiscal year ended March 31, 2019.