2018 was a banner year for Admiral’s share incentive program, with just shy of $4 million paid to Canadian employees.

The record-setting $3.8M includes two disbursements under the company’s SIP (share incentive plan), a further payout from Admiral’s DFSS (discretionary free share scheme) plan and two biannual dividends payments.

 

Background

Established in 1997, the employee shareholder program aims to ensure staff are invested in the long-term success of Admiral’s business and their commitments to the organization are recognized.

The ubiquitous SIP scheme provides $1,800 company purchased shares twice a year to all Admiral staff, giving each employee $3,600 in free annual shares, regardless if they work in Halifax, Wales, Spain, India or elsewhere.

Conversely, the DFSS plan provides additional shares over and above the SIP allotment and is reserved for organizational leaders. The amount of DFSS shares an employee receives depends on their position within the organization, performance, etc.

All shares, regardless of the plan, must remain in a vesting phase for three years before maturation and their eventual pay-out, which happens in the spring and fall annually. 

 

The Employee Benefit

“It’s certainly a game changer. Especially in this industry,” said Human Resources Director Nick Beynon of the share scheme.

“I think you’d be hard pressed to find a contact centre in Nova Scotia that offers a similar benefit where employees have ownership of their employer.”

Roughly half of Halifax’s workforce benefitted from the plan in 2018, as 224 recipients saw an additional windfall thanks to at least one of the three disbursements.

Once an employee receives their first payout, they are guaranteed to continue receiving payments twice a year in perpetuity from SIP  – providing the plan remains in effect and they are actively employed by Admiral.

“Because of the three-year holding phase, the plan recognizes and rewards an employee’s tenure with our organization, but it also ensures staff are invested in our business performance as our bottom line impacts the share price, which affects a payout total,” Beynon added.

Depending on a couple of variables, such as the share price at the time of maturation, and the GBP to CAD exchange rate, a frontline Customer Care Representative can expect to receive over $6,000 annually before taxes, from the SIP plan alone.

The result is extra funds to pay off debts, take a trip or put a down payment on a home.

“It’s helped me a lot,” said Team Manager Josh Hynes.

“In one share payment I was able to get student loan debts off my plate and after I paid those off, I was able to focus on my first house which the share scheme definitely helped with.”

 

Looking Ahead

The next vesting date for SIP shares is March 11 with a presumable payout later in the spring.

Seventeen employees who started between August 25, 2015 and March 11, 2016 will receive their inaugural payout at that time.

 “Excitement doesn’t begin to describe it,” said employee Corey Craig who started in March 2016. 

“It’s a big milestone to hit and when you see others around that have received a payout in the past, it really makes you start counting down the days," Craig added.

With Admiral's current share price hovering around £21.00 on the FTSE 100 Index, and 92 shares on the verge of vesting in March, Craig and others receiving a payout can expect approximately $3,279.00, pre-tax, providing the current exchange rate and share price hold steady.