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Talent Attraction, Engagement & Retention

Why It Matters

We recognize the shifting workforce dynamics and the increasing importance of training, developing and recruiting top talent. With a large percentage of our employees eligible for retirement, 32.5% in the next five years, we must focus heavily on transferring institutional knowledge, closely monitoring and adapting succession planning and pursuing recruitment and development strategies to attract qualified talent.

Equally important, we must continue to embrace and promote an inclusive and diverse culture to drive innovation and growth, and attract and retain the best talent. We promote a company culture of being comfortable with one’s self, allowing everyone to constructively challenge ideas and raise concerns. As a company that serves diverse communities, we respect those community differences and strive to reflect the communities we serve.

We will continue making inclusion and diversity a top priority in our recruitment efforts. Also, as we expand our business and compete for top talent, we will focus on continuing to provide strong benefits and an inclusive work culture to encourage retention. Our strategy is to continue to be people powered and drive our values. We know that current and potential employees desire to work for a company that is “doing good.” American Water is that company.

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Our Approach

Responsibility

American Water’s Senior Vice President of Human Resources (who is a member of our Executive Leadership Team) oversees Talent Attraction, Engagement and Retention practices and progress. Two main groups are tasked with managing Talent Attraction, Engagement and Retention: Talent Acquisition and HR Operations.

American Water’s Inclusion and Diversity Advisory Council, comprised of three executives and 10 cross-functional employees, support all people leaders to lead with inclusion.

Leadership on Diversity

At American Water, Inclusion and Diversity is not a department. Rather, it is an expectation that all leaders lead with inclusion and diversity. To assist them, we have an Inclusion and Diversity Advisory Council that is led by three executives: the Vice President, National Government Affairs and Community Development; Vice President, Human Resources Operations; and a division president. A Human Resource Liaison, communications representative and eight employees representing different geographies and backgrounds complete our Inclusion and Diversity Advisory Council.

Employee Hires by Age Group Chart

The Inclusion and Diversity Advisory Council oversees the formation of employee focus groups to identify a baseline for improvement and also meets with other inclusive companies to generate recommendations for our inclusion and diversity efforts. Once focus areas are identified, they receive Executive Leadership Team approval and socialize the focus areas with business leaders across the company.

We provide our regulated utility presidents and functional leaders with a monthly dashboard, including a snapshot of open positions, number of positions filled in the last month and year-to-date, age of requisition, internal vs. external hires, employee referral rates, candidate diversity, diversity in promotions and diversity of hires.

Everyone at American Water plays an important role in creating an inclusive workforce. Therefore, in 2018, we asked our employees what makes them beautifully different. Our “Beautifully Different” video includes diverse employees from across the company sharing what makes them unique. In 2019, the Inclusion and Diversity Advisory Council will solicit Inclusion and Diversity Champions to serve as liaisons with local workforces.

Gender Representation of Employees in 2018 Chart
Talent Acquisition New Hires in 2018 Chart

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Compensation & Benefits

We aim to be an employer of choice. We provide a comprehensive compensation program, designed to recognize our people and the vital roles they play in our success, with all of our employees, including union-represented, participating in the short term Annual Performance Plan.

All employees who average 30 hours or more per week receive full-time benefits and full-time employees pay only 15% of the total cost of medical, dental and vision. We offer our non-union employees averaging 20 to 30 hours per week medical, dental and vision coverage at 50% of the total cost.

American Water offers the following benefits to eligible employees:1

  • Medical Plans (PPO & CDHP) w/Prescription Drug coverage
  • Dental
  • Vision
  • Health Savings Account (HSA)
  • Health Care Flexible Spending Account (FSA)
  • Dependent Care Flexible Spending Account (FSA)
  • Voluntary Benefits
    • Critical Illness
    • Hospital Indemnity
    • Accident Insurance
    • Pet Insurance
  • Disability (Short-Term and Long-Term)2
  • Employee Assistance Program (Carebridge)
  • Wellness Program
  • Commuter Benefits
  • Life Insurance2
  • Tuition Reimbursement Program3
  • 401(k) Savings Plan with Roth Option
  • Defined Contribution Account (5.25%)
  • Employee Stock Purchase Plan
  • Defined Benefit: Pension4
  • Post-Retirement Medical5
  • Retiree Medical Reimbursement Account/VEBA6
  • Annual Performance Plan (APP) bonus

Additional employment benefits include holiday, vacation and sick time that is at or higher than industry best practice. At American Water all employees are provided:

  • 14 Holidays (including floating holidays)
  • A minimum of 10 to a maximum of 30 vacation days based on years of service
  • 10 sick days

Beginning January 2020, we will be providing two weeks Paid Leave that employees can use to bond with a new child following the birth, adoption, or foster placement, or to take care of a sick family member. For more information about American Water’s benefits, please see www.americanwaterbenefits.com.

1Benefits are for FTEs; contract employees do not qualify for corporate benefits
2Full-time employees only
3Employees working 15 or more hours per week only
4Hired prior to 1/1/2006
5Hired prior to 1/1/2002 (non-union) and 1/1/2006 (union)
6Union employees only who are not eligible for retiree medical

Beginning in 2019, 7,100+ employees have been incorporated into the company’s Annual Performance Plan to ensure company and individual goals are aligned.

Respect & Dignity in the Workplace & Commitment to Harassment-Free Workplace Policies

We have a longstanding commitment to maintain a work environment that respects the dignity and worth of each individual. In keeping with our values, we have zero tolerance for discrimination, harassment or retaliation by or toward any employee, vendor, customer or other person in our workplace. Inappropriate workplace behavior and unlawful harassment are wholly inconsistent with this commitment, and create the potential to damage the company’s reputation. We believe our stance on harassment and discrimination allows for a work environment that is free from all forms of discrimination or harassment based on any protected characteristic.

In 2019, the Inclusion and Diversity Advisory Council will collaborate with the Safety Council to open the dialogue about emotional safety, in addition to physical safety. With the rollout of “Promoting a Harassment-Free Workplace” training this year, we developed a video that addresses feeling emotionally safe in the workplace.

Each year, we choose a new focus area to catalyze inclusion practices across the company. In 2018, we introduced our Respect and Dignity in the Workplace Policy and in 2019 introduced our Commitment to a Harassment-Free Workplace. In 2020, we plan to roll out further unconscious bias and inclusion training company-wide with focused training for all employees and advanced training for all leaders. We plan to achieve full implementation of these programs in 2020.

T&I Career Fair Seeks Candidates with a Can-Do Attitude

Career FairIn August 2018, more than 80 candidates participated in our Technology & Innovation department’s first in-house Career Fair in Cherry Hill, N.J. From seasoned professionals to students preparing to graduate, the event drew potential applicants of all ages, skill levels and backgrounds. As an immediate measure of the success of the career fair, 10 attendees received official offers within 48 hours of the fair.

Technology & Innovation looks for candidates to work in autonomous intelligence, machine learning, big data, geographic information systems, application programming interfaces economy, Java and Python programming.

Truck

Succession Planning

As our experienced workforce reaches retirement—32.5% of our employees are eligible for retirement in the next 5 years—we conduct succession planning with leaders to help ensure we have a pipeline of candidates to fill critical roles within the company, particularly in the operations business area. Over the past year, we instituted quarterly checkpoints with our executive leaders to review succession plans, rather than annually.

During succession planning, leaders review diversity and turnover metrics and assess progress on maintaining a diverse and inclusive culture. Additionally, we create development plans for all candidates within the succession pipeline to make certain our future leaders develop the skills they need to fill critical roles within the company. We also work with our recruiting teams to fill talent gaps identified during succession planning.

Leadership Succession Planning

A primary responsibility of the Board of Directors is planning for the succession of our CEO and other executive officers. The primary goal of succession planning process is to identify executive talent within the company and provide for continuity of effective leadership that can fulfill the long-term requirements of our business. The planning process includes a determination of key competencies and desired experiences for the particular role, an identification and assessment of internal candidates, development plans for internal candidates and, as appropriate, identification of external candidates.

Consideration of executive succession planning (especially for the CEO role) occurs throughout the year at Board meetings and involves regular interaction between and among the Board, the President and Chief Executive Officer, the Senior Vice President, Human Resources and other members of management, as appropriate.

Recruitment

As a values-based organization, recruiting employees who embody our values is a priority. As a company that serves diverse communities, we understand the need to respect those differences and reflect the communities where we live and operate.

Our objective is to foster an environment where individuals from diverse backgrounds are understood and respected, such that all employees feel welcome and comfortable and all employees have equal opportunity. We are committed to maintaining diversity among our Board of Directors, Executive Leadership and Senior Leadership Teams, along with our entire workforce.

Investing in Talent Pipeline

To strengthen our talent pipeline and provide employment opportunities for people in our communities, we partner with several organizations throughout our footprint to encourage students of all ages to pursue STEM careers. Our communications team leads several initiatives at middle schools to instill interest in the sciences. Additionally, our Talent Acquisition team partners with local colleges and universities to develop internship and co-op programs. Our engineering department has an especially strong co-op program that encourages local engineering students to gain real-world experience and excite them about the work we do. At our Camden headquarters location, we are working to expand this program and solicit additional local talent and community partners. From 2017 to 2018, we worked to improve our internship program by creating a more holistic and inclusive internship experience. By 2020, we plan to start our first cohort of interns in our more collaborative and comprehensive program.

Attracting Diverse Candidates

Diversity is always included as a focus on every job requisition and building a candidate pool. We have partnered with several organizations to increase our female candidate pool. Specific focus is being paid to job opportunities that are non-traditional for female candidates such as plant operators, distribution employees, etc. Some of these partnerships include:

  • WV Women Work, an organization that trains women in non-traditional roles;
  • MSEP, targeting military spouses;
  • Fairygodboss Partnership & postings which target women in STEM roles; and
  • Highlighting women in our workforce on LinkedIn and other social media platforms.
2016 2017 2018
YOY Transfers/Promotions Filled by Minority, Female, Veteran or Disabled Candidates 54.2% 50% 52.6%
Job Requisitions with Diverse Candidate Pool 88% 89% 86%
transfers

Development

We are committed to providing learning opportunities and work experiences to equip all our employees with the right tools, skills and competencies to operate safely and effectively. We operate a Talent Management Center of Expertise to help develop and deploy programs that attract, motivate, develop and retain talented employees, and help foster a learning culture over time. The Talent Management Center of Expertise has three focus areas: Talent Acquisition; Learning and Development; and Organizational Development, which we implement through the HR departments that are structured in parallel with these focal areas.

Because we are people-powered, we provide a wide range of developmental opportunities to enable employees to reach their fullest potential. We require every employee, including our union-represented employees, to receive a minimum of 20 hours of training each year.

All of our non-union employees have a development goal each year. Additionally, we work closely with labor unions to learn how we can collaborate and improve our training effectiveness. As an example, we have been working with the Utility Workers Union of America (UWUA) and Power 4 America (P4A), a training trust fund created by UWUA to help ensure that our employees are prepared for the potential dangers that are inherent in our work. Through P4A, we have provided training for over 1,200 employees in various operational safety topics. Please see our Occupational Health & Safety section for more information on company and union-led safety training.

Performance Reviews

Annual competency models help ensure all employees, people leaders and senior leaders understand the skills and behaviors needed for success within their roles. We offer training and development programs related to each competency within the model, which provides employees with the opportunities they need to develop key skills and prepare for future roles within the company.

Ongoing conversations with our employees are vital to our development programs and performance management processes. These direct conversations at mid-year and year-end enhance professional development, clarify job responsibilities and performance goals and expectations, and provide a fair and equitable basis for decisions on compensation. Supervisors and employees are encouraged to have ongoing discussions about performance and development goals, and career aspirations throughout the course of the year.

We provide annual and mid-year performance reviews for all non-union employees. During the performance review process, employees have the opportunity to create meaningful performance and development goals, check-in on their progress during the mid-year checkpoint and have a final review discussion during the annual review. In 2018, all 3,621 eligible non-represented employees (representing 51% of our total workforce) received an annual performance review. Our annual performance plan aligns our company goals to individual performance. Beginning in 2019, all 7,100+ employees have been incorporated into the company’s Annual Performance Plan to ensure company and individual goals are aligned.

Employees non represented employees

We require every employee, including our union-represented employees, to receive a minimum of 20 hours of training each year.

Leadership Development

We call our managers People Leaders and we invest in them to make sure they can operate exceptionally well and take care of our people. There are two main programs to develop People Leaders: the Essentials of Leadership program for front-line employees and Leadership in Action for mid-level groups. For employee director level jobs and above, there are several program offerings targeted at developing senior leader competencies from a variety of third party vendors.

The People Leader programs support and align with our vision, values, strategies, core competencies and key drivers for success. We utilize a competency-focused approach to equip leaders to more successfully coach, engage and develop their team members. The program brings together leaders from across the organization to learn, share experiences and forge relationships that support their success in current and future leadership roles. Since the launch of the programs in 2016, 915 employees (approximately 13% of our total employee population) have participated in these two leadership programs.

Tuition Reimbursement
Tuition Reimbursement

Our tuition reimbursement policy, effective January 1, 2018, allows for up to $10,000 reimbursement per employee, per year, for education costs approved by the company. These funds may be used toward a degree program. This program enhances employees’ professional development and their skills and knowledge related to American Water’s business. In 2017, 163 employees took advantage of this program and in 2018, that number was 176.

Engagement

In 2017, a large percentage of employees, 86%, completed an employee culture survey, providing valuable feedback to make our great company even better. We are proud of the high percentage of employee engagement through both the annual survey and regular correspondence. Culture Action Teams, comprised of employees from across the company, used the survey results to identify opportunity areas and solutions to support a positive workplace culture. We did not administer a culture survey in 2018 to allow employees to continue implementing the identified Culture Actions from 2017.

In 2019, we will implement a comprehensive culture survey, designed to have shorter, more frequent touchpoints with employees. Additionally, we will implement an employee Net Promoter Score (eNPS) to gauge employees’ likelihood to recommend American Water as a place to work.

Engagement

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Our Performance

We have received various awards and recognitions demonstrating our accomplishments as an inclusive employer and employer of choice.

  • 2019 Military Friendly® Bronze Employer designation
  • Highest ranked utility in Peter Drucker Institute & Wall Street Journal Management Top 250
  • Philadelphia Inquirer lists American Water as Top-ranked Company on Diversity, Governance & Transparency
  • Environmental Business Journal recognizes American Water for Business Achievement
  • United Way awards American Water employees the ‘Leading the Way Award’ for generosity
  • American Water receives nine Directors Awards from the EPA’s Partnership for Safe Water for Excellence in Water Quality
  • Kanawha Valley Plant wins 1st place in the WV-AWWA Tap Water Taste Test

We carefully monitor our employment statistics as one measure of our management effectiveness. As of 2018, our employee turnover rates remain low, despite our aging workforce and on average all employees exceed the training expectation amount. We additionally began tracking Regrettable Turnover Rates in 2018, representing employee departures whom the organization would otherwise hope to retain, and realized 1.8% regrettable turnover during that period.

New In 2019

Barron's
#23 On Barron’s 100 Most Sustainable Companies; Highest Ranked Utility
Barron's
Top 100 Best For Vets Employers By Military Times
Barron's
Top Scoring Company On The Disability Equality Index (DEI)
Barron's
Listed In The Bloomberg Gender-equality Index

American Water Recognized with Top Score on Disability Equality Index

American Water has been recognized as a top-scoring company on the Disability Equality Index (DEI), the most comprehensive disability inclusion assessment tool designed and embraced by both business leaders and disability advocates. This year, 180 businesses participated in the DEI, and American Water’s top score of 100% earned the recognition of “Best Places to Work for Disability Inclusion.” The inclusion criteria measured culture and leadership, enterprise-wide access, employment practices, community engagement and supplier diversity.

Employee Hires by Age Group in 2018 Chart Employee Hires by Gender in 2018 Employee Hires by Business/Region in 2018
Employee Turnover by Age in 2018 Employee Turnover by Gender in 2018 Employee Turnover by Business/Region in 2018