Peters Tours Cambron Engineering to Highlight Legislation Promoting Awareness of Employee Stock Ownership Plans
BAY CITY, MI – U.S. Senator Gary Peters (MI) today toured the Cambron Engineering facility in Bay City to highlight his legislation to boost awareness of Employee Stock Ownership Plans (ESOPs). ESOPs are workplace benefit plans that allow employees to save for retirement while sharing in a business’ profits by ensuring a majority of a business’ holdings are owned by employees. Cambron Engineering, a tool and die manufacturer, transitioned to an ESOP model that has greatly reduced employee turnover and has given employees a share in the company’s success.
“Employee Stock Ownership Plans have been a proven success for businesses of all types, and I saw that firsthand during my visit to Cambron Engineering,” said Senator Peters. “Businesses with an employee stock ownership model are often more productive, grow faster and have less employee turnover, but unfortunately many small business owners simply don’t have enough information or lack the resources to transition into these plans. I introduced bipartisan legislation to help small businesses transition to an employee stock ownership structure and ensure they have the support they need to secure their legacies and provide for their loyal, hard-working employees.”
“Cambron Engineering transitioned into an ESOP program by 2005, and we are proud to be completely employee owned. Our ESOP program has greatly reduced employee turnover and allows our employees to have a direct stake in our company’s success,” said Steve Sheppard, President of Cambron Engineering. “It was great to show Senator Peters around and we thank him for promoting more awareness of ESOPs as an employee ownership model for business.”
Employee Stock Ownership plans give employees the opportunity to take advantage of a business’ profits by offering individual shares in the company. ESOPs allow an entire company—from top-level leadership to entry-level employees—to share in the financial gains when a business is profitable. ESOPs are especially common among small privately-owned businesses whose owners are retiring and want to keep a company’s continued success in the hands of loyal employees.
Nationwide, 7,000 ESOPs benefit more than 13.5 million employees who commonly earn 5-12% more in wages and see retirement accounts that are more than double those of non-ESOP employees. In Michigan, 215 ESOP businesses support over 276,000 workers.
Despite the success of the ESOP model, the National Center for Employee Ownership found that many business owners are not familiar with ESOPs and lack the resources to transition into an ESOP model. Peters’ Small Business Employee Ownership Promotion Enhancement Act will task the SCORE Association - a nonprofit outreach organization supported by the U.S. Small Business Administration (SBA) and comprised of volunteer business owners to deliver free small business services - with a new role in administering informational resources regarding ESOPs. It additionally establishes a position within SCORE to lead efforts to distribute information and general technical assistance that promotes or facilitates employee ownership transitions. Senator Peters introduced the legislation with Senator Jim Risch (R-ID), the Chair of the Senate Committee on Small Business and Entrepreneurship.
Cambron Engineering was first established in 1972, having grown from a small pole building to a manufacturing facility that employs over 40 employees today. When its co-founders contemplated retirement in 1994, they decided to transition their company into an ESOP so that its devoted employees could have a direct share in the company’s profits. By 2005, Cambron Engineering was 100% employee-owned.
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