Employees at Marquette Electronics Inc. aren't the gold diggers that they might appear to be. It's not that they don't enjoy the cushy atmosphere in which they work. But it wasn't their idea to build a weight room, a restaurant selling beer and wine, or a company theater.
In fact, Marquette's employees take a pretty flinty-eyed view of it when president Mike Cudahy indulges his sugardaddy tendencies. That's because it's not just his money he's spending. Some of it -- in the form of company contributions to an employee stock ownership trust (ESOT) -- is theirs. Since the plan was begun about 12 years ago, contributions to the ESOT have ranged from 5% of pretax profits in the early years of the plan (the minimum allowed under the ESOT plan) to about 20% (or $2.1 million) in 1985. Individual contributions to the ESOT vary widely, according to salary. The money is paid out as cash each quarter or invested in mutual funds for the future.
It is no surprise, then, that the employees ask questions -- lots of questions -- every time the quarterly numbers come out. Nor are they shy about challenging expenditures.When they noticed that Cudahy had ordered the pouring of sidewalks and a patio outside the manufacturing facility, there were plenty of skeptical employees complaining about the high cost of concrete. Not everyone is thrilled with a day-care center that is subsidized by the company but benefits only a fraction of the work force. Cracks about the company's idyllic research center have a jagged edge to them. And last spring, when Cudahy was considering building a million-dollar health center -- with gym, swimming pool, racquetball and tennis courts, an exercise room, and domed courtyard -- there was so much advance grumbling that Cudahy felt obligated to hand out ballots with the blueprints. Did his employees want to see 10% to 15% of the company's annual ESOT contribution for the foreseeable future go toward such a "magnificient facility?" By a vote of three-to-one, they did not.
Corey Rosen, executive director of the National Center for Employee Ownership, in Arlington, Va., says that kind of penny pinching is not unusual. In fact, in a four-your study recently completed by the organization, 84% of the employee-owners queried said that owning stock had made them "more interested in [their] company's success." Rosen says employee-owners are "like any other investor, concerned about how their investment is doing. They pay at least as much attention as the founders do."