This article describes how to use headers and footers when merging to letters from Google Docs.
You can insert text and images in the header and footer sections when merging to letters. However, the following features are not supported:
*|Merge Fields|* do not work within the header and footer sections. Move your content to the body section.
Make sure that the Different first page check box is unchecked.
As a workaround, reduce the top margin to 0". This will make room for the 'header' content within the body.