Jardin de Ville, based in Mirabel, Que., is a leader in the design and marketing of high-end garden furniture. The company manufactures, retails and distributes across Canada, the U.S. and Europe.
Founded in 1956 by Carmen Bourque and currently directed by Johanne Bourque, Jardin de Ville has seen phenomenal growth over the years. And, it has won a number of prestigious awards recognizing its innovative spirit.
But while this small business employs up to 100 during its high season, Jardin de Ville has had increased challenges in recruiting and retaining employees year-round. So in 2008, it decided to offer employees a retirement plan.
“We needed to adapt to the competition in the market. The need was there, and we wanted a plan that was easy to administer and that presented no risks for our company,” says Charles-Antoine Bourque, director of Jardin de Ville and one of the many family members still running the business. “That’s when we began taking the [necessary] steps. Since we had no expertise in retirement plans, we called in a specialized advisor.”
Bourque says the company couldn’t decide at first between a deferred profit-sharing plan (DPSP) and a simplified pension plan—which combines the advantages of a DPSP, defined contribution plan and a group RRSP. “For several years we’d been looking for a way to reward our good employees. Finally, after clearly defining our needs and objectives, we determined that the plan with the most advantages and the fewest restrictions in our situation was the simplified plan,” he explains.
Setting the parameters
Jardin de Ville has set specific parameters to ensure that employees are using the plan properly. For example, employees cannot make withdrawals while they are still working—unless they wish to purchase a first home through the Home Buyers’ Plan or finance studies through the Lifelong Learning Plan.
“Once the contributions are made, the plan has limited flexibility,” says Bourque. “This is because the vehicle was conceived above all as a way to encourage saving for retirement.”
Employer contributions increase with employees’ seniority, thereby encouraging the most experienced employees to remain with the company. A basic 1% is offered to all employees who participate in the plan as a way of enticing them to plan for retirement. The company then contributes 50% of the employee contribution up to a specified maximum. The employer’s contribution increases with the employee’s years of service.
“The challenge for us is to retain seasonal employees, who represent more than half of our staff,” explains Bourque. “All of our employees are eligible to participate in the plan, as long as they have worked [the required] 700 hours during the year.”
Communication is key
For Jardin de Ville, communication with the participants is crucial, especially since the plan is still young and employees are not necessarily familiar with this type of tool.
“The great majority of our employees have very little knowledge of finances, so it is important that we communicate with them regularly,” says Bourque, adding that employees receive information and support in a number of different ways.
HR meets with employees each year, holding group meetings and offering individual follow-up meetings with an advisor for those who ask. The meetings—taking place during company time—explain the ins and outs of the plan and stress the importance of financial planning for retirement. In addition, employees receive a personalized statement in the mail twice a year, updating them on their contributions and investment performance.
Positive feedback
All eligible employees have become members of the plan. And most have chosen to make the maximum contribution allowable. Moreover, approximately one-third of employees make voluntary additional contributions, indicating that they have received the adequate retirement planning message and that they have confidence in the plan.
The employer also uses its simplified plan to reward its most worthy employees by offering yearly bonuses in the form of additional contributions.
“The idea behind this strategy is to tell our employees that we appreciate their work. By doing this, we are encouraging the commitment of our key employees to our business. We know very well that our growth depends on the quality of work and expertise of our employees. We are doing something concrete to keep them with us,” explains Bourque.
Although the simplified pension plan has been in place for only two years, the directors of Jardin de Ville believe it has already brought in dividends. Among other things, the company can now rely on a more committed staff.
“We are ready to do more hiring in the next few months to sustain our growth. The fact that we offer a retirement plan will definitely be an asset in the hiring process. Our biggest challenge right now,” Bourque concludes, “is to continue developing our brand image.”
Alexandre Daudelin is editor of Avantages. alexandre.daudelin@avantages.rogers.com
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