Jeremy Goldstein Shares 3 Reasons Corporations Are No Longer Offering Employees Stock Options

Jeremy Goldstein is a business lawyer with over 15 years of experience. He is the guy big corporations turn to when they need legal advice about employee benefits. Learn more: https://www.facebook.com/jeremy.goldstein.12

 

He has been a part of some of the biggest transactions in the world with companies such as Duke Energy, Chevron, Bank One and Verizon just to name a few.

 

Here are the 3 reasons Jeremy Goldstein believes corporations are no longer offering employees stock options:

 

#1 – The Value of The Stock May Drop

 

Stocks are very volatile and can drop at any moment. If stocks drop significantly employees will no longer be able to exercise their stock options. Even still the business will be required to report the expenses associated with those options. Its a losing situation for a corporation.

 

#2 – Economic Downturns

 

As a successful business lawyer Jeremy Goldstein has seen first hand the devastation a bad economy can cause. If the economy should suddenly take a turn for the worst, all stock options will become worthless.

 

It becomes more like betting in a casino than make a sound investment decision. Because we can never predict when an economic downturn will take place, more and more corporations are becoming wary of this type of employee compensation.

 

#3 – They Can Be Burdensome

 

When it comes to accounting stock options can prove to be very burdensome. The costs associated with facilitating such transactions will often eclipse any financial gain.

 

For some staff members, having a higher yearly salary is more beneficial than having stock options.

 

The Benefits of Stock Options

 

Even with those three issues, Jeremy Goldstein believes there are still some advantages to offering stock options. The biggest benefit is that employees tend to understand stock options and they make it possible for the corporation to provide something of equal value to all employees.

 

Another benefit is the fact the staff may work harder being that their stock options will only rise if the company does good.