Newport Restaurant Group is 100% owned by its workers—and has paid them $33 million since 1995: ‘Nobody else gets the benefit’
Bartender Andy Staane has spent 24 years at Newport Restaurant Group, where every employee is an owner. As baby boomers prepare to hand off up to $5 trillion in small businesses, its CEO says ESOPs are a “proven model.”
In 1995, Newport Restaurant Group, a company founded in 1925, transitioned from being a fuel oil business to becoming 100% owned by its employees through an employee stock ownership plan (ESOP). This shift has resulted in the company paying out $33 million to its employee-owners since the ESOP's inception. The restaurant chain, which now operates 18 venues across Rhode Island and Massachusetts, employs around 1,100 people, with the number rising to approximately 1,800 during peak summer seasons.
The company's CEO, Mick Lamond, emphasizes that the employee-owners reap all the financial benefits of the company's success, citing that this model fosters greater investment in their work and ultimately enhances the guest experience. According to Lamond, this arrangement has led to low employee turnover, with many workers planning to stay with the company for a lifetime.
The ESOP approach may also address the anticipated "Great Wealth Transfer" among baby boomers and Gen Z, as it offers a more stable alternative to private equity buyouts, which can lead to higher prices and potential layoffs. By allowing employees to become the new owners, ESOPs can help preserve jobs and ensure long-term community stability.
Written by urgent.news from Fortune's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
