Frequently Asked ESOP Questions
What is an ESOP?
An ESOP is an Employee Stock Ownership Plan which is an employee-owner program providing qualifying Ameri-Force employees with an ownership interest in the company.
Are ESOPs common?
Yes, in fact they are quite common. There are close to 7,000 companies in the United States which have an ESOP. These companies employee roughly 11 million people, or about 9% of the private-sector work force.
How do ESOPs benefit employees?
Studies performed by the National Center for Employee Ownership have found that compared to traditional 401K retirement plans, employees of ESOPs generally have more secure investments and larger retirement accounts. ESOP companies often have lower rates of lay off, grow faster, and hire more often.
When do I begin receiving shares of Ameri-Force?
The “plan year” begins January 1 and ends December 31 annually. After their first year of employment, and 1,000 hours, team members become eligible to participant in the plan, during the following year the employee must work 1,000 hours and be employed at December 31st to enter into the plan and began receiving allocations and vesting. Plan entry is either January 1st or July 1st, whichever comes first. Example, if your employment anniversary is October 30th, then on January 1st you will begin participating in the plan. If your employment anniversary is January 2nd you will begin participating in the plan July 1st. Once an employee enters the plan an account is established in which their company stock is held. Allocations of stock are distributed annually to employee accounts. For full details, legal, and tax questions, please speak with the Human Resources department.
Do I need to make contributions to the plan or can I add funds to my account?
No, you are not required nor permitted to make personal contributions to the plan. All contributions are made by the company.
What are my shares worth?
An independent third party provides a valuation of the company annually. This valuation determines, in part, the value of each share of stock. Stock certificates and detailed account information are mailed to participating employees once per year.
How do I stay informed about my eligibility and stock share performance?
By keeping your current mailing address on file with the corporate office you will receive important communication regularly by mail.
How do I access funds in my account?
As a general rule, the payout of the individuals account balance will begin by the end of the 6th year of termination with employer, and are paid out over the following 5 years. Some exception to this could be death, disability or reaching retirement age while still working for employer or for those that have small balance accounts.
Am I allowed to borrow against my account?
Unfortunately this type of retirement account is ineligible for loans or borrowing.
NOTE: This Q&A does not constitute a legal document and should not be considered as such. For the official Plan Description please contact the Human Resources department.