SIOUX CITY — CW Suter Services, one of the largest HVAC and commercial plumbing contractors in the Sioux City metro, is now 100 percent employee-owned.
The employee-ownership arrangement -- known sometimes by the acronym ESOP, or employee stock ownership plan -- went into effect Aug. 1, said Suter President and CEO John Baker.
The decision to cede ownership of the company to employees was a matter of continuity for Suter, formerly owned by John Baker's father, Elbert "E.B." Baker.
"The company will continue to operate, be locally owned -- that was very important to us, to keep it locally owned, and to keep the continuity of the business moving forward, under local control," John Baker said.
"We get calls all the time from equity firms, trying to call and buy us, and different, larger companies from out of town try to buy us, and that just didn't -- I dunno, we really wanted to keep the local flair to Suter," Baker added. "Most of the time, when you sell out to an equity firm, the first thing they do is start getting rid of employees, and we just didn't want that."
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The program functions in part as a sort of retirement benefit for employees; when employees retire, Suter buys out the shares they have accrued.
"Day one, for a new employee, they become eligible to become an owner," Baker said. "It's based on percentage of their W2 earnings as a percentage to the entire company's payroll, is how it works." (Employees have to be "vested" to actually reap the financial rewards; it takes six years to become vested.)
The company's day-to-day operations will remain largely as they were before the ESOP went into effect. The only change is the ownership.
"My dad and I, and a couple other small minority owners, we don't own anything anymore," he added.
CW Suter Services employee Matt Anderson crimps sheet metal Aug. 1 in the HVAC and commercial plumbing shop in Sioux City. Suter, founded in 1…
C.W. Suter Services employee Chris Williams pulls sheet metal from a laser cutter prior to running it through a beading machine Aug. 1 in the …
Suter has almost 195 employees, Baker said.
Suter was founded in South Sioux City in 1926 by Charles W. Suter as a plumbing contractor. Suter's son, Jim, remained involved in the business until 1978.
In 1976, Suter was acquired by Climate Control Corporation in Sioux City, which kept the Suter name. Sheet metal shop manager E.B. Baker was offered a partnership in the company in 1978; he took full ownership of the company in 1981. The company operated out of three locations prior to 1994, when they merged their operations into one location at 1800 11th St., where they remain today.