Our people are the reason we can do work and we have to offer and provide for them as best we can while recognizing that we are still a business.” – Steve Hoech, Zachry Holdings.

In recent years, the job market provided an environment in which employers had to fight to keep talented, happy employees. However, the current economic climate has changed this. With more and more cuts to employee benefits and workers being asked to do more with less, employees may begin to feel the company cares less about them and more about profit. An unappreciated employee will be more likely to go in search of something better once the economy rebounds.  

Companies have started to realize how important work/life balance is in terms of productivity and creativity of their employees. Most work/life balance programs represent a small cost to the company, but can provide a huge benefit to the employee and ultimately to the organization. Small cost items can range from things as simple as business casual dress codes to flexible schedules to telecommuting opportunities. Because the full effects of a healthy work/life balance are hard to quantify, many contractors hesitate to implement these programs. However, there is a definite positive correlation between an employee’s healthy work/life balance, job satisfaction and productivity. Happy employees are usually sick less, tend to show up to work on time, have fewer errors and try to achieve more than those who are unhappy with their work/life balance. 

One company that emphasizes work/life balance to its employees is Zachry Holdings Inc. Headquartered in San Antonio, Texas, Zachry is a family-owned company with more than 20,000 employees that specializes in industrial engineering, construction and maintenance services. “We want to be people’s choice for construction, maintenance and engineering jobs whether out in the field or in the office. To do this, Zachry offers a holistic approach that makes our employees want to stay with us,” notes Steve Hoech, senior vice president of Employee Relations.¹ FMI recently spoke with Steve about work/life balance at Zachry. 

FMI Quarterly: What is Zachry’s view of work/life balance and the effects on the employee/employer relationship? 

Hoech: Zachry wholeheartedly believes in work-life balance and knows that employees who are able to care for themselves and their family’s needs, beyond just financial, are more engaged, enthusiastic and effective individuals. Over the past several years, we have continued to emphasize the benefits of work/life balance to our employees. 

FMI Quarterly: Do you have any specific examples?  

Hoech: We have seen in years past during a robust economy that fast tracking jobs have put undue pressure on both our craft workers and our managers. If employees are working six or seven days a week, we have found that productivity is negatively affected. We see absentee rates much higher on fast track and long duration fast track jobs than what we see on a more conservative workweek. Productivity, safety and other things improve when we have a manageable number of hours that we expect our employees to work. This affects managers and supervisors as well as hourly craft workers. 

FMI Quarterly: Has the current economic climate affected the benefits that Zachry offers to its employees?  

Hoech: The current economic climate has affected our benefits in a positive manner. We had intended to raise our medical premiums and increase employee deductibles and coinsurance. Instead, we chose not to increase the costs because people were already being saddled with minimal to no pay increases and we did not want to exacerbate the problem. We are proud to say that our employee premiums for medical insurance are the same or lower than they were in 2004.  

FMI Quarterly: Does Zachry communicate those costs to its employees? 

Hoech: We communicate the cost concept and the employee premium cost, but we do not specify dollar for dollar what our portion of the payments is. On average, the company pays about 75% of the cost. 

FMI Quarterly: Zachry boasts of an employee assistance program that helps employees and their families during and after work hours. What kind of assistance does this program provide?  

Hoech: Zachry staffs its internal employee assistance program (EAP) with one full-time licensed professional counselor and two certified chaplains. We provide a confidential listening ear, appropriate referral and follow-up/check-in to our employees and their immediate family members in their personal times of need. Our approach to employee assistance includes typical EAP issues such as emotional concerns, marriage and family counseling, substance abuse, work-life issues including legal and financial counsel, and child/elderly care referral. Our chaplain approach also offers care in times of need, such as spiritual direction, serious illness, injury and when someone passes away. This feature of the program differentiates Zachry from other employee assistance programs as well as other chaplain programs offered by companies.   

FMI Quarterly: What was the driver behind the chaplain approach? 

Hoech: We had an individual working for us who was an ordained minister and we chose to allow him to use his ministry in helping people within our organization. We were careful to ensure that we did not violate anybody’s particular religious beliefs. We were comfortable with him administering employee assistance to those who were seeking his help and needed a faith-based approach. He was an ordained minister for four years before we actually designated him as a chaplain.  

FMI Quarterly: According to the Zachry website, health and wellbeing are a shared responsibility between employees and Zachry. How does Zachry help share this responsibility? 

Hoech: Zachry offers competitive benefits that include services that promote wellness and disease identification and prevention, state of the art fitness facilities in the home office, healthy choices in the cafeteria, biggest loser competitions in the home and engineering offices and participating jobsite locations that promote and reward weight loss, etcetera. Medical insurance offers a co-insurance versus a co-pay, which drives the employee to search for the best overall deal on his/her healthcare. This lowers costs for the company as well. Health is an employee’s responsibility. Zachry pays the largest portion of employee medical costs (75%), and 100% of the first $500 per year for wellness benefits for each individual enrolled in our major medical plans. We contribute $600 to $1200 per year toward HSA accounts for employees who participate in our qualified health savings plan. Zachry invests in employee education regarding benefits. 

FMI Quarterly:  What prompted Zachry to have its biggest loser competition? 

Hoech: The television show, The Biggest Loser, prompted the terminology, and so we have built off that. It is another way to initiate people’s New Year’s resolutions to lose weight and to get healthy. We make it a competition because the success rate of people keeping New Year’s resolutions is pretty darn low nationally. It is another activity to keep people’s mindset towards living a healthier lifestyle.  

FMI Quarterly: Are many employees competing? 

Hoech: Yes, a lot of people do participate. Even at our job sites where we don’t have fitness centers, people join together to play sports, do outside extra-curricular activities, be engaged and have friends at work. They will enter these spot programs, like the weight loss program and weight loss competitions, to help spur each other along. The idea that we hope we are generating is that your health is your responsibility and that we share in that responsibility by helping you gain a mindset that it is one of the most valuable resources that you have. It is better than a job, because without health you are not going to have a job anyway.  

FMI Quarterly:  Does Zachry still provide “sick calls,” with a nurse on premises and video conferencing with doctors in Houston? 

Hoech: We have increased our coverage at our onsite clinic. We now have a full time physician assistant on site Monday through Friday, who is able to get to know our employees and can deal with those minor medical issues. It is a service offering that we have for those who want to use it. Many people take advantage of it, including myself and it is very effective. I do not feel any pressure to use this benefit to avoid having my own relationship with my doctor. It is a convenience factor, and is at no cost to the employees. 

FMI Quarterly: Does Zachry provide any type of on-site daycare or assistance with dependant care? 

Hoech: We have evaluated the cost/benefit of on-site day care in the past and have chosen not to provide such at this time. What we do offer is the dependant care accounts. 

FMI Quarterly: You offer fitness facilities at the home office. For those employees who do not go to the home office, does Zachry offer a gym discount? 

Hoech: We have had discounts at a variety of locations. We have worked with local gymnasiums and fitness centers to offer discount arrangements to our employees. Those are on a case-by-case and location-by-location basis. Where we can get a group of employees together to get a discount, we will do that, but it is not 100% of our locations. 

FMI Quarterly: What if your field employees simply are not interested in these discounts? 

Hoech: That’s a great question, and I’m going to answer it and then give you an overview of how we look at things. One, it’s pretty difficult to work in construction for 10-hour work days and then to find your way to go take advantage of either outside training, fitness centers, etc., because if you have to drive any distance to get home, in many cases you’re gone for 12 hours a day. People want to be home, so the percentage of them wanting to take advantage of those is pretty low.  We try to offer a menu of benefits that fit the cross section of employees that we represent. Not everyone takes advantage of all of the benefits, but we offer a menu of benefits to allow people to choose what they might need. Take dependant care as an example. Percentage wise the number of people who have dependant care accounts is small, but they are saving money and see that as a great benefit. We do not develop the benefits on a recommendation of what employees should take, we try to provide benefits that would meet their individual needs, and allow them to choose. We try to offer those things that might be needed and valued by our employees.  

FMI Quarterly:  What happens if you have a benefit that is under-utilized or not utilized at all?  

Hoech: That depends on what the benefit is. We contribute to the cost of some benefits and not to others. Because of the economies of scale, employees are being able to buy a group product that they could not afford on their own. We do have some benefits that are used in low numbers, but what we have found is that as long as the cost of administration and/or the cost to our employees is not exorbitant and not causing problems, but is still viewed as a benefit, we then continue those benefits. We have had some benefits in the past, which the price has gotten sufficiently high that it is almost viewed as a negative offering and we pull those out. As long as it is being viewed as a positive offering by some, and keeps the viability of it being an insured product, we leave it in. 

FMI Quarterly: Please explain in a little more detail Zachry’s “foundation to well being?”

Hoech:  It is a tag line that we have developed to communicate the holistic approach to family or personal foundation of health, both financial and physical. You can save for retirement, but if you are unhealthy in it, you’ll spend more money to do that, and therefore retirement might not even come because you might not live long enough. The epitome of work/life balance in our opinion is that you have to do everything in moderation. We pay money and benefits in conjunction with a positive culture to enable our employees to develop and to grow, both professionally and personally, We believe that the holistic approach produces the type of employee that we want. We have evidence, some of which is anecdotal, that people, who like where they work, see the benefit of the employer providing for them. They feel that they are contributing to a successful organization, and in fact work harder, longer and better for the employer because they see the benefits played out and paid out to them. Remember, culture + future + compensation and benefits is the value proposition that helps us achieve our goal of enthusiastic, highly effective employees.  

FMI Quarterly: What are the biggest indicators that your approaches to work/life are working? 

Hoech: I think the biggest is the comments that we hear from employees and customers as to how progressive we are in taking care of our people. They talk about the good things, we hear people come into the office and say, “This is nice, this is the kind of place where you would like to work.” Some companies are on best places to work lists. We do those same things as those companies do, but in a direct way without patting ourselves on the back too much.  

FMI Quarterly: Contractors have a difficult time offering flextime benefits, especially for the field folks. Does Zachry offer anything like telecommuting for the office folks? 

Hoech: We do not have a general policy for flextime. We do, however, allow managers to manage their own departments, and in many cases, we have developed alternative working arrangements to fit the specific needs of an employee. For instance, some people work from home, and telecommuting is not a problem. However, those cases are limited and not encouraged; they are routinely in response to an employee’s need or desire. We have some people whose particular jobs allow them to work four days a week. But our normal hours are set, 8:00-5:00, Monday-Friday, to support our field operations. We allow flextime on a department-by-department basis, as opposed to having a policy that no one can have anything different, and just let it happen as it does. But typically most people work 8:00-5:00, except in unusual situations.  

FMI Quarterly:  We talked earlier about the onsite physician assistant, which almost seems to be a concierge service. Do you offer any other concierge services on site? 

Hoech: We have an employee services department where we have arranged with a local vendor and a local automotive store to provide oil changes, battery changes and inspection stickers. We have a gifts and sundries shop, similar to what you might find in a hotel, for people who might need toothpaste or birthday cards or other items. We have an ATM machine, and laundry service pickup is available here as well. Do we offer the same thing every place? Absolutely not, but we don’t offer jobs every place that somebody lives, we offer jobs where we have them and we do as many of those things that are reasonably possible at those jobs. The basic components of our goal of enthusiastic, highly effective employees, apply everywhere, but each location has its own iteration of service offerings.  

FMI Quarterly: Is there anything you would like to add? 

Hoech: We have given considerable thought to our employees and have four goals within our company:

• Enthusiastic, highly effective employees
• Operational excellence
• Loyal customers
• Consistent profitability

We feel if we can take care of our people and take care of the work, then loyal customers and consistent profitability will follow. Our people are the reason we can do work and we have to offer and provide for them as best we can while recognizing that we are still a business.  Indeed, Zachry strives to take care of its employees. According to John Zachry, president, “We are focused on creating the right environment for people to do their best work. It all begins with the people. They are the reason why Zachry has been able to deliver better solutions, better technology and better processes for more than 80 years.”² What can your company do to create a great environment that allows employees to focus on their work and their lives? In the 2009 Benefits and Pay Practices Survey conducted by Analytical/FMI, 38 of the top construction companies in the country were asked about their offerings of work/life benefits. Out of 95% of the companies surveyed, the most common benefit was business casual dress on Friday. Of the contractors who provide business casual dress, 58% allow employees to dress in business casual all week. This is by far the cheapest benefit employers have to offer as it costs nothing to provide, but allows employees to have more flexibility in what they wear to work. The second most common work/life benefit was flextime, which also costs nothing to provide, but allows employees to have more flexibility in their schedule to accommodate their needs outside of work.  Additional popular work/life benefits that some contractors provide include:

• 9/80 schedules -34% of companies surveyed provide this benefit. This schedule allows an employee to still work 80 hours over two weeks, but get one extra day off every other week. The idea is that an employee would work for nine hours for eight days and eight hours one day of the two-week schedule.
• Reduced workweeks -34% of companies surveyed provide this benefit. This schedule allows the employee to work four days a week for eight hours, or a total of 32 hours per week. This decreases costs to the company, and works for some employees since they would still receive benefits and would have three days off per week.
• Four-day workweeks -21% of companies surveyed provide this benefit. This schedule allows an employee to work a full 40 hours a week, but instead of a traditional schedule, he or she works four days, 10 hours each day. One potential downside of this option is the decreased output or increased safety costs as fatigue may result from such a schedule.
• Telecommuting- This benefit is growing in popularity with the increase of information technology. Essentially, employees are able to do some or all of their work from a home office, which eliminates their commute to work and all the related expenses. This also provides employees with long commute times more time to spend at home with their families. This benefit can be something provided to employees as a full-time or part-time benefit.
• Family leave - A growing number of contractors are providing more leave time for families with newborns or when adopting a new child. New parents have the option of slowly returning to work, allowing the new family to adapt to this life-changing event. This can be offered as either paid leave or unpaid leave.

  What do contractors have to gain from helping employees achieve a good work/life balance?

• A better work/life balance means happy employees. Clients, subcontractors and vendors can tell when they are speaking with a disgruntled employee, but satisfied employees often mean pleased clientele who then spread the word about their services. While happy clients may only let one or two people know about their satisfaction, unhappy clients are more likely to tell three times as many people about their dissatisfaction.
• Policies that promote a good work/life balance often create an environment where employees are able to focus more on their work because they feel less stressed and more motivated about their jobs.
• A positive workplace fosters employee engagement. Engaged employees look forward to coming to work each day, and are more involved in problem solving and accomplishing goals. Disengaged employees often look for reasons to avoid work, are slower at getting the job done and have poor work quality.
• Contractors that care about the well-being of their employees become employers of choice to the best talent in the industry, ultimately making the company stronger and more profitable.
• In organizations with good work/life balance policies, turnover rates may be lower, which decreases the cost to the company for recruiting and hiring.

The idea of creating a more employee-centered work place is catching on quickly, especially among many of the companies listed in Fortune Magazine’s 100 Best Companies to Work For, which commonly offer such benefits as telecommuting, compressed workweeks and job sharing. Work/life benefits can provide a cost-effective way to increase employee morale and boost the contractor’s image, since many benefits are simply changes in the traditional work schedule. With such a low cost to implement and a high impact on the health and well-being of employees, work/life benefits provide an inexpensive and innovative way to boost employee morale at a time when they are most needed.  

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¹ Sizing up the New Zachry.  Zachry Force Report, Inaugural Issue, 2008, p. 11.