N.D.-based engineering firm adopts employee stock ownership plan
FARGO—Qigang Chang and Jacob Strombeck say they've always loved working at Advanced Engineering and Environmental Services.
It's just that now they love it even more after the company decided to adopt an Employee Stock Option Plan, or ESOP, which holds the potential for a bright financial future when it comes time to retire.
"I know it's a very positive thing for everyone at the company," said Chang, a project engineer at Advanced Engineering, which also goes by AE2S.
Strombeck, a project manager at AE2S, agreed.
"We've always had a strong work ethic at AE2S and I think it (the ESOP) will be a continuation of really good things. I think it's a great way to continue to be motivated in the firm," Strombeck said.
Motivation was one of the things the company had in mind when it moved to set up the ESOP, said Steve Burian, AE2S's CEO and a co-founder of the company that started in 1991 and has headquarters in Grand Forks.
The ESOP, Burian said, "changes the way they (employees) wake up in the morning, in terms of approaching the company and what we do for our clients.
"Now," Burian added, "when they wake up they can actually help affect their financial success over time."
When the new ESOP took effect Jan. 1, it transferred ownership of the company to more than 280 employees across six states. The company has 18 offices, including large footprints in Bismarck, Fargo, Grand Forks and Maple Grove, Minn.
Burian said while from a technical standpoint ESOPs can be complicated to explain, he summarized the AE2S plan this way:
The company was sold to a trust for the benefit of the employees, and over the span of years financial benefits will be granted to employees based on their pay.
Similar to a 401(k), those benefits come to fruition when employees retire and if the worker has many years in with the company, those fruits can be substantial, according to Burian, who said he knows of a worker who was part of a similar ESOP who recently retired after working decades for an electronic equipment company in the area.
That worker's ESOP payout was "north of a million dollars," Burian said.