Salas O’Brien

Salas O’Brien, in Irvine, California, has been booming over the past few years. Not only has the engineering and technical services company experienced organic growth, but it has been averaging six to eight mergers a year with other like-minded firms. So far this year, the company has completed four mergers, strengthening its priority markets and service offerings. 

The team now totals over 3,000 members, largely in North America, and the company’s 401(k) plan has been growing along with it—in the number enrolled but also in engagement. Since Q1 of 2022, the participation rate went from 85.7% to 94.3%, and the average participant deferral rate went from 8.8% to 10.8%. Average balances also increased 16.6% last year. 

“The plan transition process we have at Salas O’Brien is something we continue to refine to meet the needs of each team,” says Lucas Hellmer, associate vice president, director of compensation and benefits at the firm. “We approach each as a partnership, working closely with the incoming leadership team to understand what’s important to their team members and to tailor the communication about our plan offerings. While every situation is unique, we do draw on best practices from past mergers to make the process as seamless as possible for team members.”

The focus remains on the overall team experience, he says. With any change, the sponsor strives for a smooth and positive process, while communicating the additional value team members will receive, including the 401(k)—a safe harbor plan with automatic enrollment at 6% pre-tax. There’s also up to a 1% matching contribution typically delivered in shares of the company stock fund each year.

The plan’s recordkeeper, Principal Financial Group, and advisers UBS and Actuarial Benefits work together to present webinars for merging participants. According to Renee Fourcade, senior vice president at UBS, these webinars are “very well attended.”

In partnership with Principal, Salas O’Brien has also started a series of larger-picture financial wellness webinars for all plan participants about setting budgets, paying down debt and understanding available resources.

Hellmer attributes the plan’s success, overall, to both the automatic enrollment provision and education on the opportunity to build equity with Salas O’Brien through the company discretionary 1% year-end match. “That has really boosted the enrollment,” he observes. The match, a key addition to the plan design several years ago, reinforces the organization’s focus on financial well-being, he says. 

For team members, the “increased participation and rapid growth of assets” over the past few years have further enriched the benefit, Fourcade says. “We’ve been able to lower costs for several of the investment options.” 

Investment changes have included the addition of collective investment trusts to the plan. In response to provisions of the SECURE [Setting Every Community Up for Retirement Enhancement] 2.0 Act, the company has increased the distribution options, accepting loan transfers and loan payoffs for team members who, respectively, have joined or who leave the company. 

As to preparing for future mergers, Hellmer says, “While each merger may be unique, our intention is to make the process smooth and positive for all team members when joining Salas O’Brien.”

Says Diane Walton Blevins, chief human resources officer at the firm, “Our benefits team collaborates closely with our retirement plan partners, incorporating team members’ feedback to continually improve and customize our offerings to their evolving needs.”

—Corie Hengst