As far as employment contracts are concerned, employees have a right to own shares of companies that hire them. However, it has been reported that most businesses are violating this right. According to Jeremy Goldstein, these corporations do not want to incur extra charges when the stock value drops significantly. Furthermore, allowing employees to procure shares could lead to considerable accounting burdens to a company.
Jeremy Goldstein also asserts that stock options are crucial in increasing the personal earnings of the workers of a company. He notes that the earnings can only be boosted when the company’s stock value goes up. In this case, the staff will strive for customer satisfaction for the firm’s revenue and share value to increase.
The “Knockout” Strategy
Companies can stick to Jeremy Goldstein’s “knockout” strategy if they want to gain benefits while allowing their workers to buy shares. When adopting the knockout strategy, the stock options must have similar vesting requirements as well as time limits. Furthermore, the workers lose these options when the value of shares goes below a certain amount.
About Jeremy Goldstein
Jeremy L. Goldstein is a reputable lawyer and writer. He previously served as a partner of Watchel Lipton. At the law firm, his practice involved executive compensation issues. He left Watchel Lipton to open his boutique law firm, situated in New York, majoring in executive compensation and corporate governance legal issues.
Goldstein’s firm, Jeremy L. Goldstein & Associates, LLC is establishing a name for itself in the law field. Goldstein attributes his successful law career from the LLB he got from NYU School of Law. He seeks to help corporations and individuals understand how good corporate governance can benefit them. He also seeks to educate employees on compensation matters in accordance with the law. Goldstein’s articles on these topics have appeared on Harvard Law’s website, New York Monthly Herald and Blogwebpedia.
Visit http://jlgassociates.com/ to learn more.