Holiday surprise: One Michigan business hands out $20,000 bonuses to workers
The 200 workers at a floral-supply business in Michigan got a surprise at the company's holiday lunch: $4 million in year-end bonuses, or about $20,000 per worker.
FloraCraft owner Lee Schoenherr, 82, said he wanted to give the bonuses as a way to thank the company's employees for helping build the business, which sells foam products for the craft and floral industries through stores such as Michael's and Amazon. The gifts are based on each employee's length of service, and will be paid through a cash bonus and a contribution to the workers' 401(k) accounts, the company said in a blog post.
FloraCraft's workforce has an average employee tenure of nine years, with the company noting that some employees represent the second or third generation in their families to work at the business. The highest gifts will be directed to workers who have spent four decades at the business, with their gifts topping $60,000.
"I believe strongly in giving back to the community by supporting initiatives that make Ludington a wonderful place to live, work and raise a family," Schoenherr said in the blog post. "A few years ago, I began thinking that I would like to do something more targeted for our employees, who really are the heart and soul of FloraCraft."
The bonus comes at a time when automakers in Michigan are cutting thousands of jobs, and half of Americans -- many in places like FloraCraft's home base in Ludington, Michigan, a town of 8,000 residents -- still haven't regained their financial footing a decade after the Great Recession. President Trump's tax cuts, which lowered corporate tax rates, have been directed toward stock buybacks, which reached a record $1 trillion earlier this month.
"Giving back"
The decision to provide the bonus was partially due to the new tax law, but FloraCraft CEO Eric Erwin told CBS MoneyWatch it was a gesture that Schoenherr had wanted to do for a long time.
"He wants to do this while he could enjoy giving back to the people who have given so much to him," Erwin said. "The business climate is good and we feel good about where we are."
Because the company has focused on providing financial education as part of its corporate wellness efforts, it wanted to provide a contribution to its workers' 401(k) plans, as well as cash.
"We recognized that people need cash immediately," Erwin said. "Even though it'll be a taxable event for them, they can take care of some of life's emergencies. We thought it was important to give some of the bonus in cash and some in the future," through the 401(k) contributions.
FloraCraft was founded in 1946, and it said that it has never had a layoff. Schoenherr took over the business from his uncle in 1973. He added that the gifts aren't a signal that he's planning on retiring or selling the business.
"But don't think this means I'm exiting or selling the business – I love what I do and am committed to maintaining the independence of FloraCraft," he said in the post.