You have to select a mercenary before a battle. During in combat, tap the Mercenary icon to the left of the selected character's portrait to swap to that mercenary. Swapping at the correct moment can be very useful, regardless of how powerful your companion mercenary might be. You are effectively swapping the selected character for someone entirely different. For example, when a soldier is about to die or is suffering from a status effect, you can swap to a healthy character and keep the original character safe. You can then switch back to the original character when safe.