One of the biggest benefits of working at an ESOP company is that it can provide an employee with significant retirement assets, in addition to a 401(k). Since stock is allocated to each employee’s account based on a contribution by the company, the employee bears no cost for this benefit. ESOP enables employees to accumulate shares in the business without contributing any of their own money. Instead, the company makes contributions every year that are used to buy shares. Upon retirement or separation from the company, disbursements are made to the employee-owner to be used in retirement over and above their 401(k) assets.
Also, according to a recent Rutgers study, employee-owned companies tend to provide a more generous benefit packages to their employees such as health benefits, flex time, parental leave, tuition reimbursement and more that help with employee’s financial lives. In addition, the report stated that employee-owned companies provide more transparency to employees to help with their understanding of their company’s financial situation. NTH follows this trend as, in addition to our retirement plans, we offer a very generous benefit package, a Wellness program and a Volunteer Time Off program.
Another unique ESOP benefit for employee-owners is that it gives each employee-owner a stake in the success of our company. Everyone is working to build his or her, and everyone else’s, successful future. When the company succeeds, we all succeed! This helps to improve morale and lends itself to a more engaged team with supportive co-workers.
Shared ownership makes people part of something bigger than themselves. Being able to benefit directly from the overall success and profitability of the company adds significant motivation to work harder, think creatively, and work efficiently as a team.