Employee Ownership Blog

As I noted in my last update, several bills to encourage employee ownership were introduced in 2009. One I did not mention was H.R. 692, introduced by Dana Rohrabacher (R-Calif.).

Last March, Google exchanged more than 7.6 million employee-held options with exercise prices above $500 for options priced at $308.57. Three-quarters of Google's employees were affected. In exchange for a lower strike price, each agreed to a delayed vesting schedule.

The surprise failure by Congress to address the one-year lapse in the estate tax effective in 2010 means that if replacement securities owned by a seller to an ESOP who took a Section 1042 tax deferral on the sale are passed to an estate, they could be subject to capital gains taxes, at least for

If you have not already done so, you can still vote for the NCEO board. You will need your member number to cast a valid ballot. To vote, go to http://www.surveymonkey.com/s/R9QYM2F.

A new NCEO survey on ESOP governance practices shows that 13% of the responding companies have an independent institutional trustee, while another 4% have an independent individual trustee. That is down from 21% in 2005, although within the margin of sampling error.

Senator Bernard Sanders (I-VT) has introduced two bills to encourage employee ownership. The first, S. 2909, provides funding for states to set up employee ownership programs.

There has been a lot of buzz lately about replacing traditional stock awards with performance shares. "Performance shares" is a term of art, not a legal term. It is simply a plan that grants shares outright to an employee upon the achievement of a specified target.

Once again, it is time to think about applying for the annual Winning Workplaces awards. If your company has 750 or fewer full-time equivalent employees, you are eligible. The award is being cosponsored by Inc. magazine.

In April 2011, I will step down as director, although I will continue as a staff member, hopefully for many years to come. The search process for a new director has now closed. I think we have found the perfect candidate.

John Logue, the founder and director of the Ohio Employee Ownership Center, died on December 9 after a short battle with a very virulent form of cancer.

A new NCEO survey of 190 ESOP companies shows that only 26% of the respondents have boards made up only of current employees, compared to 49% in 2005. Twenty-nine percent have boards that have a majority of inside directors, compared to 25% in 2005.

A new study of 200 large companies by Koski Research for Charles Schwab shows that companies retain a strong commitment to equity compensation at all levels. Stock options remain the most popular form of reward, with 71% of the companies offering this benefit.