Making a commitment to their workers

Sometimes, to save jobs, executives and firm owners gave up bonuses and salary increases.

Claire Halton, of ACTS Retirement-Life Communities Inc., one of the managers who gave up a wage increase to save jobs, with resident Daniel A. Rothman.

In the darkest days of the recession, top managers who collected bonuses and pay raises while laying off their employees made headlines and raised the ire of politicians and policymakers, including President Obama.

But outside of the spotlight, to save jobs, some executives and business owners gave up bonuses and salary increases or agreed to take pay cuts. Some even provided increases for their employees at the same time.

No wonder some of those companies earned a place in the Top Workplaces 2010 survey.

The lesson of the recession from these leaders? Communication and commitment count, especially during times of trouble.

In 2009, the top brass at ACTS Retirement-Life Communities Inc. showed their commitment to their employees by giving up their pay raises. Normally, top brass could count on a 3 percent raise, plus 7 percent to 20 percent more in performance bonuses.

"We recognized that we have a lot of frontline staff at lower-income levels, and they lead very challenging lives," said Claire Halton, corporate director of employee relations for the company, which runs retirement communities and employs 5,200 people nationally, 2,500 in the region.

"We thought we should forgo our raises as a gesture to help," she said.

Halton said managers realized that even if their employees could count on job security and a pay increase, those same employees might be severely affected by the recession if a spouse lost a job.

"We certainly did not want to impact our frontline staff," she said. Raises for middle managers on the departmental level were delayed.

Communication is key, the executives said.

"In times of turbulence, they want to know if their jobs are safe," said Michael Smith, spokesman for the West Point, Montgomery County, company. Platitudes are not enough, he said.

Chief executive officer Marvin Mashner wrote letters that explained the relationship between the real estate market, which has been down, and sales at ACTS, also down, and the company's efforts to cope.

"If you leave questions and concerns unaddressed, that's when speculations and rumors can occur," Smith said.

James Meehan, chief executive at Creative Financial Group Ltd., of Newtown Square, agreed. "When there is anxiety in the marketplace, there is anxiety everywhere," he said. "I think you have to communicate even more than necessary. This is not the time to run and hide."

Until 2009, in the history of the company, Creative had never had layoffs, but last year about five had to go.

There would have been more at the 115-employee company, but "we asked people to restructure their workweek," Meehan said. Some people reduced their hours and their pay to save others' jobs.

If communication counts, so does commitment.

For example, the ACTS group runs a discount shuttle service to pick up employees from the city and take them to retirement communities in the suburbs. It also provides a shoe allowance - important in a retirement community where workers spend all day on their feet.

At Voice Systems Engineering Inc., of Langhorne, chief executive Gary Baron rewards employees by allowing them to step off the treadmill. Every month or so, the company has Innovation Day.

"We sugar and caffeine them up," he said, laughing about the doughnuts, followed by lunch.

Meanwhile, they can use the time to think about something the company should do to grow. Sometimes there is a query - how can the company amaze its customers or what can it learn from competitors. Sometimes it is more free-flowing.

"It is not just the ideas that come out of it," Baron said. "It's also the process of telling people to step out of what they do."

At the Philadelphia Convention and Visitors Bureau, the inspiration for commitment came from The Dream Manager, by Matthew Kelly, a book that urges employers to build engagement by helping their employees achieve their dreams.

Senior vice president Wanda Paul read the book, bought copies for the bureau's top management, and put it into practice with her direct reports.

"What inspired me was how making the dreams of others come true is really life-changing," Paul wrote in an e-mail. At first, she thought it would be the employee's life that would change, in turn creating "a happier workforce and an environment where the employees really care."

But, there was an unexpected consequence.

"Really, the ultimate benefit is for the people who work hard to make the dreams of others come true," she said. "It is a rewarding experience that makes your heart smile."

These days, receptionist Yvette Rainey is learning Spanish - a dream of hers. The bureau paid for the Spanish program, but Paul dangled an extra carrot. Paul promised Rainey a week of her vacation time-share in the Spanish-speaking culture of her choice when Rainey became proficient.

"Think she likes where she works? Think she enjoys coming to work?" Paul wrote. "I think so."

Rainey agrees.

"I've worked in places where the senior staff didn't know my name, even though I answered the phone," she said.

Rainey said that being bilingual would help her and the bureau. Having her dream met at work "just confirmed why I'm here. I'm much more than a receptionist to this organization. I have a lot to do, and I'm happy to take on more."

For at least two companies, the challenge is how to cope with expansion. "We're just booming," said Audrey Burke, human resources manager at NewAge Industries Inc., an 84-employee plastic-tubing manufacturer in Southampton that recently added an extra shift and is still hiring. An interesting perk? Employees receive gift cards to the William Penn Inn.

In Marlton, many of the employees of the Michaels Group are personally committed to the owner, Michael Levitt, said spokeswoman Laura Zaner, a relatively new hire.

Levitt and his wife cement the commitment by personally underwriting tuition grants for the children of company employees.

In the down time, the company's conservative management gave it the ability to acquire distressed businesses in its field of residential building management, from low-income housing to university apartments.

Michaels employs 160 at its headquarters and 1,400 around the nation. Now it's trying to hire 100 more to manage buildings in California.

"We are the opposite of bureaucratic," Zaner said. "As we grow, we are very concerned that we remain young at heart and don't lose our entrepreneurial spirit."


Contact staff writer Jane M. Von Bergen at 215-854-2769 or