The Employee Ownership Update
July 15, 2016
Bipartisan Federal Legislation Would Encourage Broad-Based Stock Options in Private CompaniesIdentical bills introduced in the House and Senate on July 12 would make stock options more attractive to employees in privately held companies by increasing the flexibility of the time they must pay taxes on those options. Employees generally pay taxes on options for the year in which they exercised those options, but this bill would allow them to defer those taxes for up to seven years. To qualify for the extension, the employer would need to offer options to at least 80% of its employees and would agree to provide information about changes in stock price.
The sponsors of the Senate bill are Sens. Mark Warner (D-Va.) and Dean Heller (R-Nev.), and the sponsor of the parallel House bill is Rep. Erik Paulsen (R-Minn.). Speaking in support of the bill, Sen. Warner said, "Extending employee stock programs to a broader universe of workers will strengthen business growth and create new economic opportunities, especially for rank-and-file workers."
Is the UK's New Prime Minister a Fan of Employee Ownership?Theresa May, who became the prime minister of the United Kingdom this week, has fueled speculation that she may be an enthusiastic supporter of the UK's burgeoning employee ownership sector. In her speech on July 11 while campaigning to be prime minister, she did not directly address employee ownership, but she did focus on building a more inclusive economy and said, "if I'm prime minister, we're going to . . . have not just consumers represented on company boards, but employees as well."
Ten Ways to Make Your ESOP GreatOver the last 35 years, we have identified a number of key plan design features and operational practices that help ESOPs succeed. We have put the 10 best, with a link to useful resources on these ideas, in our article Ten Ways to Make Your ESOP Great.
The CEPI Comes to the East Coast: July 29The Certified Equity Professional Institute (CEPI) at Santa Clara University in California will host the 1st Annual CEP East Coast Symposium in partnership with the Rutgers School of Management and Labor Relations. Building on the highly successful symposiums at Santa Clara University, this one-day event offers the same high level of informative sessions and networking opportunities that the West Coast has experienced over the past 12 years. See the agenda here.
Well over 100 people have registered, and space is limited. The event will take place in New Brunswick, NJ, from 8:30 am to 6:00 pm. Registration is available online and costs $350.