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The variable does not get merged.  

Based on the following:
https://docs.skuid.com/latest/en/skuid/merge-syntax/global-merge-variables.html

Global Functions

  • urlEncode / encodeUrl: for URL-encoding merge data so that it can be safely added to a URL. Equivalent of JavaScript’s encodeURIComponent function. Example: /apex/skuid__UI?page=LeadsWithCompanyName&companyname={{#urlEncode}}{{companyName}}{{/urlEncode}}
  • urlDecode / decodeUrl: for decoding URL-encoded merge data. Equivalent of JavaScript’s decodeURIComponent function. Example: {{#urlDecode}}{{$Param.companyname}}{{/urlDecode}}
I thought in a URL merge i needed to urldecode?

In any case your recommendation resolves like this: