Our Employee Stock Ownership Plan
At Jaynes, Ownership Mentality Extends to Our Compensation and Benefits
In 1956, the founders of Peninsula Newspapers, Inc. faced a succession crisis. Both were in their 80s and needed to retire, but they worried about what would happen to their company’s culture after they were gone.
They didn’t want their newspaper to fall to the same fate as many of their competitors, who were absorbed into big-name corporations. They wanted their employees, who already knew and embodied their vision, to assume ownership. But purchasing the company outright was too pricey for the employees to manage on their own without a significant financial hardship.
An attorney and economist named Louis O. Kelso came up with a solution: an employee stock ownership plan that utilized the existing profit-sharing and retirement program to fund itself. The ESOP was born.[1]
How Our ESOP Works at Jaynes
Jaynes adopted the ESOP model in 1976 as part of our employee benefit plan. As of 2019, we are 100% employee-owned. The stock plan works hand-in-hand with our 401(k) to provide retirement benefits for vested employees. Essentially, every employee receives a contribution into the plan each year, based on salary. Upon retirement or leaving the company, that investment can be rolled into another investment account or cashed out.
The employee stock purchase plan is available to all non-union employees who have been with the company for at least one year. The stock is held in a trust with a board of elected trustees who represent a mix of Jaynes leadership and rank-and-file employees who ensure every voice is heard and every worker shares a stake in the company’s performance.
Stock prices are valued annually in compliance with IRS rules, so our share prices are affected by the market even though we’re not publicly traded. This means the investment value of Jaynes stock can vary depending on interest rates, inflation, political events, and other factors. But the biggest driving factor of our value is our company’s performance. ESOP participants benefit directly from the hard work they put into maintaining Jaynes excellence.
Investing In Our People
We never met those Peninsula Newspaper owners, but we at Jaynes have a lot in common with them. We are all part of a legacy more than 75 years in the making, one that will hopefully continue to grow and expand for decades to come. But each of us also embodies the values Jaynes Corporation was founded with: work ethic, authenticity, humility, and a deep desire to raise the standard of construction and living in the communities we call home.
Our ESOP allows us to invest our profits back into our employees in a way that supports their growth and protects our culture long-term.
Stock ownership gives every employee a reason to see the company excel. It also gives team members skin in the game. We don’t answer to outside stockholders with their own agendas. We’re accountable only to ourselves, to each other—and to our greater purpose.
SOURCES:
[1] The origin and history of the ESOP and its future role as a business succession tool. The Menke Group. (n.d.). https://www.menke.com/esop-archives/the-origin-and-history-of-the-esop-and-its-future-role-as-a-business-succession-tool
