Employee Ownership Blog

Ninety-two percent of the 13,000 employees of Kanan Devon Hills Plantations (KDP), a South Indian tea plantation, have purchased stock to buy the company from its owner, Tata Tea.

As part of its partial privatization, Electricite de France has undertaken the largest continental European employee ownership plan to date. Employees can borrow money to buy up to 15% of the stock at 10% off the share price. Employees have to hold on to their shares for five years.

In Announcement 2005-80, the IRS set out the details of a proposed settlement procedure for a number of improper transactions, including three abusive applications of S ESOP rules.

It seems that you can't be any kind of publication and not have a year-end review, often in the form of top ten lists. Not wanting to violate important traditions, here is my list of the top ten developments in employee ownership for the year.

A lot of organizations didn't come out so well in the wake of Katrina, but 100% ESOP-owned Acadian Ambulance Services in Lafayette was universally acclaimed as heroic.

Institutional Shareholder Services (ISS), the influential proxy advice organization, has changed its guidelines for voting on equity compensation plans to make them somewhat more flexible.

In Notice 2005-94, the IRS announced it is suspending the withholding requirements for 2005 with respect to deferrals of compensation covered by the deferred compensation rules of Section 409A of the Internal Revenue Code.

The University of Wisconsin Employee Ownership Management Program will hold its next session in spring 2006.

The Senate has passed the Pension Security and Transparency Act (S. 1783), a bill providing comprehensive reform of defined benefit plans and significant changes for defined contribution plans.

The Financial Accounting Standards Board (FASB) has voted to conduct a comprehensive review of how companies account for retirement plans.

Daniel Hogans, an attorney-advisor in the Office of Tax Policy at the Treasury Department, told a November 17 meeting of the American Law Institute-American Bar Association that rules under Section 409A of the Code for deferred compensation cover stock awards that contain a feature extending the

The Presidential Advisory Panel on Federal Tax Reform (the "Advisory Panel") recently issued its final report, which proposed eliminating all present forms of defined contribution plans, which on its face would include ESOPs.