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Jeremy Goldstein has long been an expert in executive compensation. Advising CEO’s and compensation committees is one of the specialties of his law firm, Jeremy L. Goldstein & Associates. Goldstein always stays on top of trends in the world of compensation.

 

Recently, he took on the question of stock options for the Law Blog for the Average Joe. He notes that in recent years, many companies have stopped offering stock options. If the value of the company’s stock drops, employees are unable to use them. Stock options can be expensive because they result in additional bookkeeping tasks. Finally, many employees would prefer a higher salary.

 

However, there are still a number of reasons employers should consider keeping this benefit around. Because options are tied to the company’s performance, they force employees to work in the company’s best interests. They can help keep key employees driving hard toward their goals. Also, options are a better value for employers than shares. The IRS makes it difficult for employers to distribute stock shares, particularly to executives.

 

One way for employers to get the most out of this benefit is to use the knockout stock option. A knockout option is available for a shorter time than a traditional stock option. They also expire in the event that the stock’s value plunges. The knockout clause, in Goldstein’s opinion, can be particularly great for companies with volatile share prices.

 

Jeremy Goldstein is known for his savvy analysis of common issues in business law. With over 15 years of experience in the field, he has a track record of success. In fact, he successfully established a law firm on his own in the competitive New York legal scene.

 

For updates, follow Jeremy Goldstein on twitter.

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