I would like to get the opinions of other business owners to how long before a new staff member needs to be working for the business before they become part of the employee share options. We introduced it last year for staff who have been with the business almost from the start 4 years ago but not sure whether new employees should have to wait 1, 2 or 3 years. What do people think?

Hi Matt,

Great question. I assume this is a private company?

Personally I would wait a few years to see how they perform. Nothing wrong with a recognition program and rewards attached before the Share Options are available.

You could profit share before hand, you could do bonuses, you can change the vesting date which means they don't get the shares for several years.

There are many ways to deal with the situation.

Sorry it was not that specific but hope it has opened your idea about other options.

AJ

Hi Matt,

I’d say it depends on where the business is located and the availability of great staff.

I know of great financial planning businesses that aren’t in the big cities. They run the risk that great employees leave the town for the city & so they offer an employee share scheme very early on as a means of trying to retain great staf.

If you don’t have that problem then maybe wait a little longer when they have proven themselves & have shown some commitment to the business.

All the best.
James

Hey Matt,

if your existing crop of employees were issued shares after 4 years, howe will they feel when someone else gets issued shares after a much shorter period of time????

maybe this wont bother anyone, but it might be worth considering on the off chance that someone might get their nose out of joint??

but I suppose it really depends on what you reckon is fair and reasonable.......

cheers
BC