#United States #Washington #Employee Ownership #Retirement Security #Bipartisan Bill

Enhancing Employee Ownership to Secure Retirement

On July 25, 2025, Senators Steve Daines (R-MT) and Maggie Hassan (D-NH) introduced significant legislation in the Senate designed to increase employee ownership within private companies in order to enhance retirement security. The bill, known as the Promotion and Expansion of Private Employee Ownership Act of 2025 (S.2461), aims to create additional avenues for sustainable job creation, wealth accumulation for retirement, and overall business growth.

Key Features of the Bill

This legislative proposal seeks to encourage owners of S corporations to adopt Employee Stock Ownership Plans (ESOPs), particularly during ownership transitions. The bill encompasses several critical measures:

• - Technical Assistance: It will provide much-needed technical support to companies interested in establishing ESOPs.
• - SBA Certification Support: It will help small businesses, which transition to ESOP ownership, maintain their Small Business Administration (SBA) certification.
• - Establishment of an Advocate: It proposes the creation of an Advocate for Employee Ownership at the U.S. Department of Labor to promote and facilitate ESOP formation.

Stephanie Silverman, President and CEO of the Employee-Owned S Corporations of America (ESCA), highlighted the growing concern among Americans regarding retirement savings, stating, "Employee ownership becomes a practical and bipartisan solution that could uplift millions of working families." She expressed appreciation for the legislative efforts of both Senators and their commitment to improving retirement outcomes.

Benefits of Employee Ownership

The introduction of ESOPs is viewed as advantageous for both employees and business owners. Employee ownership expands economic participation across the middle class, empowering individuals to invest in their own financial futures. Senator Daines remarked, "I'm proud to lead this bipartisan bill with Senator Hassan to support Montana workers and businesses, making the American dream more accessible for all." The move is expected to foster a more inclusive economy, ultimately benefiting a broader spectrum of the workforce.

Senator Hassan echoed these sentiments, underscoring the importance of employee contributions to business success: "Behind every successful business are employees who dedicate time and energy to their work, and employee stock ownership plans give workers a real financial share in the fruits of their efforts."

Collaborative Support in Congress

At the time of the bill's introduction, it was backed by 12 original cosponsors from both political parties, including prominent Senators like Marsha Blackburn (R-TN) and Bernie Sanders (I-VT). Their support emphasizes a collective recognition of the necessity to bolster employee ownership as a strategy for both economic stability and personal financial growth.

The Role of ESCA

The Employee-Owned S Corporations of America (ESCA) plays a vital role in advocating for the interests of employee-owned S corporations on Capitol Hill. By giving voice to those involved in ESOPs, ESCA strives to enhance the legislative landscape around employee ownership and ensure that workers benefit fully from their labor and investment in their companies.

This new bipartisan initiative led by Senators Daines and Hassan marks a significant step toward enhancing retirement security for millions of American workers, offering a path to increased economic equity through employee ownership. As further discussions unfold regarding this legislation, the impact on workers, businesses, and the economy at large will be closely watched.

As employee ownership gains attention as a viable solution to retirement security concerns, it signifies a movement towards promoting a sustainable model of business that recognizes and rewards the hard work of its employees.