Holt of California

Holt of California is a construction equipment dealer formed from a merger of two California Caterpillar dealers: TENCO Tractor, begun in Marysville, in 1931, and Holt Bros., begun in in Santa Maria, in 1939. The two combined in 1998, and now the resulting exclusive provider of Caterpillar equipment operates in multiple locations in the state’s Central Valley.

Approximately 38% of the company’s employees are represented by a union; of those employees, 25% to 33% participated in a 401(k) plan from about 1995 through 2005, says Marlene Lawler, Holt’s employee benefits manager, at the in Pleasant Grove headquarters.

By 2020, that rate had increased to 60%, which Todd Thompson, Holt’s vice president and chief financial officer attributes to a “strong education program” that targets union members. Holt has also worked to increase plan participation and savings rates among its nonunion employees.

“We set our employees up for success with automatic enrollment at a 4% contribution rate and an automatic increase of 2% annually for all who defer less than 12%,” Lawler says. “For nonunion employees who drop out of the plan [during] the year, we sweep them back into it annually.” The auto-enrollment does not apply to union employees due to their union contract. Plan participants may choose from pre-tax, Roth and catch-up contributions, where applicable.

As measured by pre-retirement income replacement, the plan design is indeed benefiting participants, Lawler maintains. Nonunion employees comprise about 62% of the workforce, and, she says, 80% of that group is projected to replace at least 50% of pre-retirement income; 44% are projected to achieve 70% replacement. Union employees will have additional retirement income from their union pension; Holt cannot make similar projections for that group.

Ongoing educational efforts have been an important factor in the plan’s acceptance among both groups of workers, Thompson says. Holt offers an annual employee education and advice program each year. Through SageView Advisory Group LLC and Principal Financial Group, participants are invited to financial wellness webinars, ongoing education online, and one-on-one meetings at least annually, he says. During the one-on-one meetings, participants sit down with the Principal education specialist, who helps them create a plan to reach their retirement goals. 

Holt also takes plan education sessions to its employees at their business locations, says Lawler. “We also hold annual retirement plan meetings we call ‘The Roadshow,’” she says. “During these meetings, Todd and I visit our locations, along with the Principal education specialists. We take this time to provide our employees with education regarding various retirement and financial wellness topics. We also remind them of the features of our plan and the importance of saving for retirement.”

The pandemic sidelined the on-site roadshows, but those are restarting in this year’s second quarter, says Lawler. Holt provides two sessions at each location on subsequent dates. The first meeting is for union employees to explain the importance of the 401(k) plan and how to participate in it, plus to give an update on the union pension plan’s status. The follow-up presentation is open to all employees; it’s essentially a “401(k)/retirement education [presentation],” she says.

Participants appreciate the on-site presentations, says Lawler. Initial sessions for union employees draw about 70% to 75% of eligible participants. The more general meetings for all employees pull in between 40% and 50% of participants, but that’s largely because most union employees have already attended the first session and don’t turn out at the same level for the open program.

The company’s retirement plan committee also works to address the diversity of the company’s workforce. It is composed of Holt’s CEO, chief financial officer, benefits manager, assistant human resources manager and employee representatives. Holt’s efforts are paying off with both employee groups, says Thompson. He notes that the company had increased participation among nonunion employees to 99% by year-end 2021, and the participation rate for both groups in total is 83% with a combined average deferral rate of 9%. “We truly care about the safety, health and well-being of our employees, and certainly retirement readiness is part of that as well,” he says.

—Ed McCarthy