Are your staff engaged and motivated?

With the change in working environment, it can be difficult to engage and motivate employees.

Often to keep key employees in a business, a business must be able to demonstrate the opportunities for growth in the role and with that can come a cost. Rather than increasing salary or benefits, businesses should consider employee share/ option plans (“ESOPs”) as an alternative to engage and motivate the right people. ESOPs can provide an opportunity for employees to buy into a business over a period, without necessary creating significant costs to businesses for remunerating high performing employees. However, the tax implications for employees can differ depending on how the ESOP is structured.

Areas that businesses should consider if they want to offer their employees ESOPs include:

  • Will they offer the ESOPS to all employees, or a select group of employees with a number of years of experience?
  • Do you want to offer employee shares/options in tranches, dependent on performance milestones?
  • Further to this, what behaviours or outcomes do you want incentivise?
  • Can the business rely on a recent valuation to value the ESOPs?
  • If you are a private company, are the owners willing to purchase the shares once employee options have been converted?
  • Can the business take advantage of the concessions available to start ups?

Reach out to your HLB Mann Judd contact to discuss employee share/ options plans or the other available options for your business.