On December 3rd, 2021, Essential Recruitment became 100% Employee Owned – it’s been a very exciting journey for all of us!
Since then, quite a few local companies have been in touch with us to find out more about transferring to Employee Ownership, so we decided to discuss our own experiences here.
Why make the transition?
Our current Directors bought into the business in 2016, but they won’t be around forever. As they are always thinking ahead, they debated their future options; They would either have to sell the company to a competitor or investor, facilitate another MBO or retire and remain shareholders… however none of these felt right. They just didn’t tick all the boxes.
It needed to be right for the business, the team and the individuals.
The Employee Ownership model proved to be just that; It protects the team, provides opportunities, helps with succession planning, and offers financial rewards.
How did you announce it to the staff?
We drip fed the announcement over a few weeks, explaining that big changes were coming and that all would be revealed soon – we invited the whole branch network to join us at the Casa Hotel in Chesterfield where we would break the news!
At the hotel we delivered a presentation we’d be working on for weeks – ensuring that it delivered the message with the right tone and with adequate information. It can be pretty hard to get your head around everything at first, so we made sure we spoke in a way our staff could make sense of.
Later in the week our Directors and newly formed board of Trustees had conversations with each branch to discuss the changes with staff after they had time to reflect on what they’d learned.
We distributed booklets with lots of information about the Employee Ownership model, and have these prepared for any new staff that join us.
How did the staff react?
We were told to expect a mixed reaction – some would be very supportive, some would be against it, and some would be indifferent. We found that to be fairly accurate!
We had lots of opportunities to speak to those who weren’t interested at first, and managed to turn those opinions around. We’re very lucky to have a culture where employees feel safe enough to express their true opinions, but we’re also lucky enough to have staff who will listen to our reasoning and understand why decisions have been made – resulting in them ultimately doing a 180 and agreeing it’s a great thing.
How have things changed?
Day to day there aren’t many changes – it’s our structure that has changed the most.
Board meetings now include our 6 Trustees, a group who act in the interest of all Employee Owners (EO’s) bringing their voices to the table. We’ve implemented a suggestion box for all staff to submit their ideas / thoughts in time for discussion at these meetings.
When the time is right, we will be paying a profit share to all EO’s – this would have previously been paid as dividends, so this is a huge change for the Employees.
Our future is being built collaboratively, and we’re stronger for it.
What happens after the announcement?
Life goes back to normal, but culture must change for the EO model to work effectively.
We found a few ways to keep staff engaged:
- Regular communication about the ways that EO’s are contributing to the growth of their company
- Releasing financial information to allow EO’s to assess the current state of their business
- Inviting ideas and suggestions for discussion at each board meeting
- Encouraging EO’s to include “Employee Owner” in their email signature and LinkedIn profile.
- Distributing framed and signed photographs of the team as of 3rd December, plus enamel pins to those with over 12 months service
- Creating a social committee to organise future social events, and embracing suggestions from EO’s on what the events should be / when they should be. ( it’s their money we’re spending!)
- Involving all EO’s in a video project to celebrate the change
and we are always looking and more ways to keep the benefits in mind for all staff.
That’s our journey so far, but we’re a work in progress! We aim to keep improving and growing over the coming years, so watch this space!
If you’d like know more about our journey into Employee Ownership, contact us on firstname.lastname@example.org and we’ll do our best to answer any questions you may have.
Read more about Employee Ownership on our blog: