“People are our greatest asset.”
“Our people make the difference.”
“The foundation of our success and the key to our future are our people.”Not just clichés, these statements sum up the sentiments of most successful construction companies. To put it simply, people run the show—negotiating contracts, operating equipment, scheduling deliveries, laying bricks, inputting data and everything else in between.
There’s no question dedicated employees who perform well on the jobsite and in the office are the reason contractors thrive. But, how can contractors show that same level of commitment to their employees?
The Answer: Benefits
CSM Group, a 25-year-old construction management firm in Kalamazoo, Mich., believes wholeheartedly in putting people first. This philosophy is manifested foremost in a comprehensive insurance program covered entirely by the company. From medical and dental to short- and long-term disability and life insurance, employees (and their dependents) do not pay any premiums and have no waiting period to take advantage of these benefits.
Underground Construction Company, Inc., a 73-year-old heavy/civil, utility and industrial contractor based in Benicia, Calif., takes a similar full-coverage approach to benefits for its approximately 350 employees.
"The most positive feedback we get from employees is that we pay for benefits. People realize other companies don’t offer that or do not cover dependents," says Muzette Perry, Underground Construction’s human resources manager.
Employees’ appreciation really resonates in the current economy.
"You hear people say it’s an extra cost, so you might want to cut an employee benefit, but in our opinion, that’s one of the worst mistakes you can make," says Chris Ronco, president of Underground Construction. "It’s essential to take care of our employees because when the economy turns around, they’ll sustain the company."
Beyond insurance, one of the most attractive pieces of a company’s benefits package is a retirement savings plan—with the most common being a 401(k) plan with an employer matching or profit-sharing component.
Providing vacation, holiday, illness and bereavement time also is important to employees. Some companies are becoming more liberal with the number of days offered and more flexible about when employees can use time off, or if time off can be carried over to the next year. For instance, CSM offers new employees 25 days of paid time off (PTO) a year, and with seniority it goes up to 30 days a year.
"There’s no waiting time," explains CSM Group Chief Financial Officer Dave Copeland. "We distribute PTO hours regardless of how long someone has worked here."
Adds CSM Group Vice President Curt Petersen: "I think that’s a trend going forward. The younger generation ranks having time off as more important than having higher pay. It’s an extremely valuable benefit to them."
Outside the Benefits Box
In a time of skilled workforce shortages, contractors are seeking ways to bolster their programs with benefits outside the usual insurance, PTO and retirement offerings to attract and retain the best employees. Dallas-based TDIndustries, which has been named to Fortune’s list of "100 Best Companies to Work For" for 11 consecutive years, offers flexible workweeks to some of its 1,600-member staff. And Notch Mechanical Constructors, Chicopee, Mass., offers each of its 65 employees one paid day of leave per year to volunteer in the community. CSM also rewards and encourages employee volunteerism by tracking the amount of hours employees give back to the community, with a goal of 50 hours per employee each year.
On the wellness front, TDIndustries subsidizes employee gym memberships, and Underground Construction has a gym onsite. CSM pays an annual fee to HelpNet.com, which employees can utilize for personal problems such as substance abuse, divorce or financial difficulties.
Recognition—beyond compensation and bonuses—is another benefit for employees. This can take the form of naming an employee of the month/year, highlighting employees in a company newsletter, giving out service awards, advertising safe driving records and encouraging on-the-spot acknowledgement of quality work.
And, of course, nothing benefits employees more than providing a safe working environment in which they can create a successful career path. Like many contractors, TDIndustries reimburses employees for tuition, books and materials for continuing education classes, as well as pays wages for time spent in training and covers the fees associated with professional and trade licensing.
For Roger Schultz, president of Schultz Brothers Electric Co., Inc., Kansas City, Kan., "safety is supreme." The 20-year-old firm, which provides electrical services in the health care, telecommunications and light industrial sectors, absorbs the cost of safety and first-aid training, as well as apprenticeship and continuing education programs.
"We also offer cross-training in skill sets. As the economy changes, we want to provide uninterrupted employment. We want employees to learn other skill sets so if there’s a slowdown, they can continue employment in a different discipline," Schultz says. "People come for the career opportunity and as a part of that potential and culture, they get the benefits package."
Program Assessment
If everything is running smoothly in a company’s human resources department, it can be tempting to just maintain the status quo. However, successful contractors warn against ignoring benefits program assessments.
"For years we’ve always done accounting audits, but we needed to look at our other departments," Petersen says. So, CSM hired an independent firm to conduct a human resources audit, which determined the company’s flexible benefits offerings greatly exceeded market expectations.
Internal assessments (i.e., employee feedback) also are very effective. About three years ago, CSM started a focus group geared toward benefits, perks and efficiencies. Comprised of employees from both the office and the field, the group spurred the company to add the PTO program and award more employee recognitions. And, per the group’s recommendation, CSM put toolkits in employees’ trucks and trained onsite workers to use an automated external defibrillator.
Underground Construction is preparing to survey staff members about its benefits program this year.
"We’re asking how they feel about the benefits program so we can gauge what they value most," Perry says. "Or maybe we’ll find out about a benefit many of them may not use so we can focus our attention elsewhere."
Workforce demographics certainly affect employees’ values, making it even more important for managers in charge of recruitment and retention to regularly evaluate the benefits of most use to staff members.
"What’s important in their 20s may change in their 40s, so we pay attention and listen to what’s important and find the best ways to incorporate that into our business model," Schultz says.
Return on Investment
No doubt, considerable time and money is invested in assembling a comprehensive benefits package that meets the needs of an increasingly demanding construction workforce. But just like the expense needed to support successful safety training and continuing education programs, the return makes the investment worthwhile.
Combined with its culture of hiring talented employees with drive, honesty and integrity, CSM’s above-average benefits program has helped the company grow from 34 to 86 employees and more than triple its volume of work in the last four years.
"One of the most interesting things is the referrals we get from people who say 'you really want to work at CSM because there’s such a strong culture,'" Petersen says. "We’ve had people who worked for more money elsewhere come back to work here for less money in their paycheck, but with the benefits program and culture, they want to be here."
Adds Ronco: "We want to attract and retain long-term employees. We feel that by offering these benefits, we get employees who want to stay with the company, which helps us provide better services to our customers."
Providing quality benefits not only keeps employees happy, but it also contributes to a firm’s reputation in the industry. This dedication to corporate responsibility can be recognized through Associated Builders and Contractors’ (ABC) Accredited Quality Contractor (AQC) program.
In addition to employee benefits, the AQC program honors construction firms that document their commitment to training, community relations and safety.
These four standards fall in line with the values of Hamer Electric, Longview, Wash., which seeks to “be a leader rather than a follower” and provide quality services through trained personnel, low turnover and community involvement. The 37-year-old company performs automation control, systems integration, industrial, commercial and residential electrical work throughout Southwest Washington and Northwest Oregon, and has been a member of ABC since 1998.
"We’ve always stressed—and it’s true today more than ever—that longevity is based on quality, not price," says Terry Cole, president of Hamer Electric. "Anyone can be an electrician; it takes a craftsman to do it well."
As an AQC contractor, Hamer can use AQC language in bid documents, utilize the AQC logo, access discounts on other business development opportunities offered by ABC and gain points on ABC’s National Excellence in Construction Awards submissions. Additional benefits include recognition from the industry, business community and public, as well as acknowledgement in ABC’s national membership directory, www.findcontractors.com.
"AQC allows us to stress our quality in our advertising. If we can put it in our ads, it’s a good connection to our customers. It helps screen the type of customers we’re after—not those just looking for the lowest bid,” Hamer says. “We also use the AQC logo on vehicles and on our website."
ABC member companies that seek to qualify for AQC certification must achieve gold or platinum status in the association’s Safety Training and Evaluation Process program. Application questions cover management education curriculum, skilled worker training, types of benefits offered to both salaried and hourly employees, support for charitable organizations and more. It also requests materials such as a safety handbook, a letter certifying participation in an ongoing craft training program, a diversity statement, community service promotions, and press clippings or photographs that support the company’s industry image. Annual renewal is required.
For more information, call (703) 812-2061, email aqc@abc.org or visit
www.abc.org/aqc.