Business lawyer Jeremy Goldstein is the top advisor to many of New York’s largest companies. Corporations headquartered in other states often send representatives to meet with Jeremy Goldstein and hear what he has to say. What he’s talking these days is employee benefits and choosing the right compensation method.
Over the last few years, more and more corporations are eliminating traditional stock options and awarding their employees with other types of benefits. While every company has the right to choose their compensation method, Jeremy Goldstein doesn’t think it’s a good idea for everyone to get rid of stock options.
Some companies profit from providing stock options to their employees. They’re ignoring the obvious advantages due to their employees wanting different benefits. Sometimes, it’s the companies itself that want to eliminate stock options and offer something less complicated, which is starting to back for some.
As more corporations drop stock options, they’re replacing them with equities. While equities seem like the logical choice rather than stock options, recent IRS rules might make providing equities harder than providing stock options. Others choose to pay their employees higher salaries or wages, which creates a huge imbalance between employees.
Stock options offer a level of equivalency that other benefits can’t offer, a bonus many corporations forget. Also, stock options make employees personally vested in the company’s success. If the company performs well, their stocks are worth more. This makes employees work harder to satisfy current customers and innovate to attract new customers.
Taking all of that into account, it’s no wonder why Jeremy Goldstein wants more corporations to continue providing stock options. It’s also important that they choose the right kind of stock option. Goldstein recommends they use “knockout” stock options, which has all the benefits of their counterpart with fewer risks.
Regardless of his opinion, it’s important that every corporation talks with their accountant to determine the best course of action. Not every compensation method works well for every enterprise. If any of them do decide to change their current method, Goldstein suggests they wait at least six months before offering anything.
If anyone’s wondering who Jeremy Goldstein, he’s a partner at his law firm, Jeremy L. Goldstein and Associates. He’s been in the legal advisory business for more than 15 years and played major roles in transactions for clients like Verizon, AT&T, Bank One, and Merck. Learn more: http://www.bizjournals.com/newyork/potmsearch/detail/submission/6423046