COVID-19 Pushes Pennsylvania ESOPs to Protect Jobs and Increase Business

Employees at NewAge Industries, Urban Engineers, Andesa Services, and Avail Technologies are leaning on their culture as owners to accomplish their jobs during the pandemic

Employee-owned companies in Pennsylvania are finding their corporate culture is helping them thrive during the COVID-19 pandemic.

“The employee-ownership model strengthens in times of crisis. We are seeing employee-owned companies across the state stepping up and leading us through this period,” Kevin McPhillips, executive director of The Pennsylvania Center for Employee Ownership said.

There are currently more than 300 companies in Pennsylvania that are either partially or fully employee-owned. They include Dansko Shoes, Bradford White Water Heaters, and Sheetz. Nationally, 5,000 other companies have Employee Stock Ownership Programs (ESOPs).

Southampton-based NewAge Industries is classified as a life sustaining business as it produces tubing and hose for COVID-19 vaccine development, ventilators and testing equipment. Still, they quickly transitioned from having four or five employees working remotely to 57 in the last few weeks.

“I get that funny feeling that there’s a deeper commitment. They’re all owners so they want to help out, but it’s also truly a life sustaining business,” NewAge CEO Kenneth Baker, said.

During the last economic downturn, no employees were laid off, as they have a no layoff policy. As an ESOP, the business already has a strong base of communication and trust, which is very helpful during these times, Baker said.

“I feel employee ownership in this time can help an organization stay together and keep the culture from declining, which is so important,” he said.

At Urban Engineers, an employee-owned civil engineering firm in Philadelphia, CEO Ken Fulmer said that making tough decisions at this time is humbling but it’s somewhat comforting to know that success is ultimately distributed in shares to its employees, not to an unknown group of outside investors or shareholders.

“As employee-owners, our staff is invested in Urban and motivated to foster the company’s growth while making necessary sacrifices for us all to remain solvent,” he said.

Andesa Services, an Allentown employee-owned company selling cloud-based life insurance solutions, created a Pandemic Response Team to address issues and questions from its owners. While it’s taking time to adjust, the message from CEO Ron Scheese has been a constant since 2015 when Andesa began its ESOP journey.

“Take care of yourself, take care of each other, take care of our clients and take care of the company. An ESOP is done for the legacy of a company, not purely financial value, and our employees remain dedicated to our culture, our succession plan—our ESOP—and our mission of Andesa Forever,” Marketing Coordinator Tammy M Staudt said.

State-College-based-ESOP Avail Technologies, is also considered an essential business as it provides services to the transit industry. According to Transit Support Specialist Mike Shuey, Avail focused efforts on assisting customers and have adapted well, giving credit to the company’s employee-owned culture.

“Many of our employees have pitched in with sanitizing the entire building on a daily basis to assist our house keeping staff. Through these tough times this ownership mentality has kicked into high gear and it’s truly remarkable what we can accomplish as a company of owners.” He said.

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