By Kyla Alterman
“We have an incredibly talented and intelligent group of people and we wanted to make sure they feel informed, part of the ESOP, and rewarded,” explained John Zarsky, Regional VP at Pennoni who also serves as one of the internal trustees at this 100% ESOP firm. Implementing a custom version of Workplace Development’s Certified Employee Owner (CEO) program helped Pennoni achieve this important objective.
Keeping a workforce informed about your ESOP can be a challenge, especially when your company has over 30 locations with 1,200 employees and counting. Pennoni, an engineering firm based in Pennsylvania, has experienced continued growth and a steady addition of new employees. They needed a system to communicate their ESOP and employee-owned culture effectively and consistently to everyone. The answer was working with Workplace Development to create the “Pennoni Employee Ownership Certification” program.
Pennoni’s ESOP education program takes employees through four short video modules. Employees are invited to watch the modules at their own pace. After each module, employees take a simple quiz on the information. When an employee passes all four quizzes, they become a certified employee owner and receive an opportunity to receive special Pennoni merchandise.
Pennoni has had an ESOP since 1994. The percentage the ESOP owned grew over time until the company became 100% employee-owned in 2019. “We felt it was time to take a fresh look at how we inform employee owners on why our ESOP is important and make sure we are hitting all the key points. We wanted to celebrate the folks who took the time to go through the certification process and really understand the advantages of being employee-owned,” explained Zarsky. “There are still some misunderstandings about what it means to be an ESOP firm.”
The series of educational segments were customized to Pennoni’s goals for employee training. “We hoped employees would understand the fundamentals of what it means to be an ESOP-owned firm, functionally, but more importantly they would understand our ownership culture,” said Pennoni Regional VP Mark Celoni. “If you are here, you are an owner of the company, and we want to instill not only how your day-to-day work contributes to the company overall but also how you benefit on the backend.” Celoni, who also serves as a trustee for the plan, noted that company leaders want employees to be able to say, “I am an owner of this company.”
While building a shared understanding of ownership was one goal of the training program, it was also aimed at helping employees see their affect on value. “We were interested in addressing performance improvements, so everyone recognizes their role in the company. When the company does well, the ESOP does well, and all the participants do well. That was part of the education; you can really affect the company no matter your role, entry level or senior management,” said Celoni. One of the modules was a recorded interactive activity showing how job-level actions influence value. “There were some great examples of employee-owner impact,” added Zarsky. “And the double whammy is if the company does well, not only is there more money for the company to put in the ESOP, but our stock value goes up, too. All those profits stay within the company for the employees.”
While there are varying degrees of understanding about the ESOP, the modules were made to teach everyone something and start a conversation. “I am happy with the quality and the way the material was presented,” said Zarsky. “It was very digestible. It felt like in the end we came up with a good program that hit the high points that we wanted.”
The feedback on the videos has been very positive and led some employees to request additional information about the ESOP. “We are an engineering firm, so people want numbers, and we were able to cover additional questions in follow-up meetings, like our quarterly town halls. If we get very specific questions from individuals, we address them individually. Part of the idea is to create a knowledge base in the firm so not only new people have it, but older people in the firm have it, too. We want our existing staff proselytizing new staff. It’s a great recruitment tool that will differentiate Pennoni from a lot of our competitors.”
The Pennoni Employee Ownership Certification has been optional for employees. “I was pleased with the participation levels both with watching the videos and completing the quizzes,” expressed Celoni. “We’ve had more than half the company complete the quizzes, and more than a third pass all four parts. That was significant because we had some doubters.” Quiz results continue to roll in every month.
Pennoni is in the process of incorporating the modules into the new employee onboarding process within their first few months or year with the company. “We have new folks starting every week, as well as acquisitions, so we wanted to make sure we had a tool in place for the people coming in, so they had the same appreciation as the older folks,” said Zarsky.
“Overall, we were really happy with the results. The program has given us something to build on,” added Zarsky. “Now that we are 100%, we think 100% of our employees need to understand the value of working for an ESOP firm.”
To bring a custom Certified Employee Owner (CEO) program to your company, contact Kyla Alterman at firstname.lastname@example.org.