Marvin Profit-Sharing Exceeds $15 Million
Marvin window and door sales plummeted by 25 percent in the spring, but Marvin announced Friday that a rapid housing market rebound is allowing the company to share $15.3 million in profits with its employees.
The family-owned company, based in Warroad, Minn., established its profit-sharing tradition 63 years ago.
The business that’s long been a mainstay of the northwest Minnesota economy now operates 14 manufacturing plants in eight states. During a virtual annual meeting Thursday, Marvin leaders revealed that 5,841 employees would share $15,326,676 in 2020 profits.
“Product quality was strong, we experienced one of the best safety years in our history, and record sales came in across the enterprise,” CEO Paul Marvin said in a Friday news release. “The common thread that ties all of these accomplishments together is our people. Our actions and attitudes in the face of pressure this year put us in a great position for the year to come.”
Despite the pandemic sales decline early in the year, Marvin’s profit-sharing for 2020 exceeded the total employee distribution of about $11 million for 2019. A portion of the Marvin profit-sharing is awarded in cash, while the remainder flows into employee retirement accounts. Employees also can elect to direct the cash portion into their 401 (k) accounts.
“The profit-sharing amount is divided evenly among all eligible employees with adjustments reflective of hours worked—full vs. part-time,” said Marvin spokesperson Emily Finley. “This year, the average profit-sharing check was more than $2,700.”
Several factors allowed Marvin to end 2020 on such a successful financial footing.
It already had a pandemic plan for the company when Covid-19 arrived in March, so it did not get caught flat footed. Paul Marvin immediately started recording video messages to employees about safety protocols they needed to embrace, which would allow Marvin factories to remain open and the workforce’s jobs to be preserved.
When orders for Marvin products dropped 25 percent during a one-month period, Marvin leaders moved quickly to cut expenses to match the revenue coming in from a reduced demand for windows and doors.
Temporary mid-year furloughs
Passage of the federal CARES Act allowed Marvin to institute temporary furloughs that would not financially harm its employees. During the week of April 20, Marvin started furloughing some employees, including people who worked at plants in North Dakota and Virginia. When targeted one-week furloughs were in effect, employees qualified for unemployment benefits and Marvin maintained their health insurance coverage. Through the CARES Act, the furloughed employees received $600 a week in federal unemployment benefits, which were in addition to state benefits.
When it appeared that it would take considerable time to get Covid-19 under control, many Americans decided to upgrade their homes—where they were living, working and playing. People also purchased new homes, which were more suitable for working from home and educating children remotely. Both categories of homeowners boosted Marvin’s sales for windows and doors.
By late July, Paul Marvin told TCB that customer orders had been strong for several weeks across multiple product lines. “Our turnkey window replacement division, called Infinity from Marvin, has indeed seen phenomenal growth since May,” Marvin said at the time.
Those robust sales allowed Marvin to end temporary factory-worker furloughs by the end of July. Salaried workers were returned to their pre-pandemic compensation on Aug. 1, and Marvin also fully reinstated its match on 401 (k) contributions for salaried and hourly workers.
Fighting pandemic fatigue
While Marvin management and employees are celebrating their financial rewards from 2020, Paul Marvin has implored his workers to be extra vigilant in avoiding exposure to Covid-19 and staying home if they are sick.
Shortly before Thanksgiving, Marvin recorded a video message for employees in which he emphasized the spike in Covid-19 cases across the nation.
“Some of our [manufacturing] locations are seeing a sharp uptick [in Covid-19 cases] and many are unable to join us at work due to exposure or infection,” Marvin said. “Business remains strong, and that means orders are up and so is the backlog.”
He stressed that Marvin is telling customers that the company is working through window and door orders as quickly as possible, but that its first priority is the health of its employees.
“We are committed to keeping our people safe and that means we must ensure that people who have Covid, may have Covid, or have been exposed to Covid stay home,” Marvin said.
“As temperatures drop and the holidays draw near, it’s important to remember that what we do outside of work also matters,” he said. “As cases continue to increase at an alarming rate, it is critical that we don’t let pandemic fatigue get the best of us.”
Increasing employee benefits
Christmas Day is a paid holiday for Marvin employees. Marvin announced that employees also will get a paid holiday on Christmas Eve in appreciation for the work they did during a stressful year they “battled through together.”
Marvin acknowledged how 2020 has taken a toll on individuals and families.
“In the same spirit of thinking about our collective well-being, and the time we may need to spend away from work, we are also extending a new option for temporary leave,” Marvin said.
“We understand that life happens during a pandemic or any time,” he said. “If you are facing family care needs, emergencies, or other personal crises and don’t have access to or have exhausted all paid or unpaid leave, up to four weeks of unpaid personal leave will be made available to all Marvin employees.”
Paul Marvin, who mandated mask-wearing in Marvin plants starting in mid-May, is asking employees to limit their social interactions to avoid Covid-19. “Right now, doing the right thing means skipping unnecessary travel, avoiding gatherings, following what our state governments have ordered, even during the holidays,” he said. “We all have a part to play for our safety of our loved ones, our community, and our co-workers.”