So What Is Employee Ownership, Anyway?

An Employee Stock Ownership Plan (ESOP) is a tax-qualified employee benefit plan establishing the employees of a company as the beneficial owners of stock in that company.

Through the Burns & McDonnell ESOP, employees automatically become stockholders at no cost to the individual. At each year-end, the company makes a cash contribution to the ESOP. This contribution is then distributed to all eligible employee accounts as a proportion of compensation.

The cash in each employee's account is used to purchase shares at the current fair market value. As a privately owned company, our stock is not publicly traded and therefore the stock price is determined each year by an independent valuation consultant.

Throughout employment with the company, an employee's account grows with annual contributions, stock appreciation and dividend payments. Employee-owners vest in ESOP assets over a period of six years. After two years of service, a participant is 20 percent vested, increasing 20 percent each year until they are fully vested. When an employee-owner retires or leaves the company, their stock is repurchased and they receive the proceeds from the sale of stock.

Retirement may seem distant, but the Burns & McDonnell ESOP is a high-impact program that can secure your future.