In his article Jeremy Goldstein explains why companies have stopped giving their employees stock options. Firms occasionally do this to save money, but usually there are reasons that more complex than that. One big reason is that the stock that employees get can drop significantly. Regardless, the businesses still have to report those expenses. Many employees won’t even consider using the stocks, they would just rather get their cash. The stock options could result in burdens and paying extra money on top of the stock. The options just aren’t practical enough to keep on doing for years at a time
Don’t worry, not all is bad. There are a few advantages that must be mentioned. You can make the argument that stocks are still better than getting extra wages or insurance coverage. Its simple for the staff to understand the stock options and there is more saving potential. What’s also better is that the shares will increase if the company does better financially. At the end of the day the irs makes it difficult to make money with their rules of sharing equities. In conclusion, companies are going to eventually stop using stocks because there is potential for them to decrease.
Jeremy Goldstein is founder of Jeremy L. Goldstein & Associates, LLC. He went to New York University school of law and received an MA from the University of Chicago. Lastly, he has BA cum laude from Cornell University.
The goal of his company is to advise compensation committees and corporations. He is very experienced in the field that he works in. Before he created his own company, he worked for a New York law firm. He is also the lead compensation lawyer in Chambers USA Guide to America’s Leading Lawyers for Business and The Legal.
To learn more, visit http://officialjeremygoldstein.com/.