Yes. Sometimes it takes a while for the mercenary to activate the aura. Normally I'll have him engage by himself some low level monsters (not bosspack) and by the end of the fight that normally gets his aura going.
If you are going to hire an Act V mercenary then do so in Normal, not NM. The reason for this is that Normal mercs have higher stat points than NM or Hell mercs so your barbarian companion will be stronger with more life and so forth.
Act V mercs in general are more of a novelty than anything. While they do have very nice life regen they are just another tank for your character. Act II mercs outshine them due to the aura they possess.