Cover:Corporate Plan Sponsor of the Year: M.A. Mortenson Co.: Building a Better Future

When was the last time you saw a mariachi band at an employee education meeting?

If you had attended builder M.A. Mortenson Co.'s Fiesta Luncheon for its primarily Hispanic building trades employees in December, you could have checked out the band, munched on chicken and spicy ribs, and seen a raffle drawing that gave the employees prizes such as fishing gear, Home Depot gift certificates, and gas cards.

Photo by Raul Benavides

From left: Tom Gunkel, Annete Grabow, and

Don Mengel

You also could have listened to talks about financial readiness and asset allocation given to the workers, whose construction sites had been shut down so they could attend. You also would have observed company officials signing up employees on the spot in their retirement plan, and collecting a lot of enrollment forms.

Participation for this highly transient group of workers had fallen from 76% at the beginning of 2007 to 56% before the luncheon. After the fiesta, participation jumped to 91%, and assets in that plan total $3.5 million.

Enrollment always spikes after get-togethers like that, says Annette Grabow, Manager of Retirement Benefits at the construction company.

"If we can get in front of them, we can get them to sign up," she says. "I know them, they know me. They get to ask questions, and we can get advocates [both foremen and co-workers] who are happy with the plan to work the room."

So, it surprised Grabow to hear a speaker at a recent conference, clearly an automated-features enthusiast, assert the death of education. "I was just flabbergasted. We hear that sometimes, and it infuriates me," she says. "We do not think education is dead. Some education does not work, and it is a waste of time, but I know education does work. I have seen it."

While Grabow thinks automated features have their place, Mortenson currently has none, other than an optional deferral increase that goes up 1% annually. "I do not want our team members to do something because it is the least-painful thing to do," she says. "I want them to understand what they are doing, and do it because it is the best thing for them."

Mortenson Projects

Employees of the builder work on projects that have spanned 47 states as well as international locations. The company's projects include the likes of the Colorado Rockies' Coors Field, the Walt Disney Concert Hall in Los Angeles, and the expansion of the main terminal at Washington Dulles International Airport.

Mortenson has about 160 job sites currently active, as well as six permanent offices: the headquarters in Minneapolis and locations in Seattle, Denver, Phoenix, Milwaukee, and Chicago.

The workforce totals more than 3,100 currently, and that includes 1,331 unionized craft workers, 1,333 eligible office workers as well as 27 ineligible workers, and 452 non-unionized craft workers. Numbers for both the non-union and union craft workforce can surge up or down dramatically at times, Grabow says.

Average tenure among the non-union craft employees totals 3.3 years, she says, while the average tenure among salaried workers dropped this past year to 5.41 years because the company hired 500 new ­salaried employees last year. Previously, tenure for salaried employees ­averaged about 10 years.

In addition to the plan for non-union craft employees, Mortenson has a plan for salaried employees that currently has an 84% participation rate and $104.1 million in assets. Education has paid off there, too; 82% of team members attended voluntary workshops in fall 2007 and, during that education campaign, 38% of nonparticipating team members enrolled in the plan.

(The company's unionized workers have separate, union-coordinated benefits.) The company does not offer defined benefit plans, and did not previously.

Both the salaried and trade plans have a dollar-for-dollar match up to 4% of pay, a goal that the company achieved in 2005 after increasing its match about 20% per year for a few years. "Right now, we are running in the 8% to 9% range on deferrals in both plans," Grabow says. Her explanation: "We educate the heck out of them."

As the numbers confirm, that philosophy pays off for Mortenson. "They have excellent participation, and their plans work extremely well," says David Wray, President of the Chicago-based Profit Sharing/401(k) Council of America, citing its average deferral versus the typical 5.4% that PSCA's research has found. "There is no question that this program is integral to the success of the company."

In October, his organization announced that Mortenson was one of the winners of its 2007 PSCA Signature Awards for excellence in communication and education.