Asked by Samantha Valadez on Jul 22, 2024
Verified
What is the drawback of stock ownership as a form of incentive pay?
A) Financial benefits mostly come when the employee leaves the organization.
B) Employees have the right to participate in votes by shareholders, hence reducing the negotiating power of the employer.
C) It causes the employers to lose control over their employees.
D) The employees will not benefit even if the organization is performing well.
E) Stock options do not provide any ownership to employees, instead offering an equivalent sum.
Incentive Pay
Compensation awarded to employees to motivate them towards higher performance and efficiency, often linked to achievements or goals.
Financial Benefits
Monetary-based benefits provided to employees, such as insurance, retirement plans, bonuses, and salary increases.
Shareholders
Individuals or entities that own one or more shares of stock in a public or private corporation, having a financial interest in the company's performance.
- Understand the drawbacks of various forms of incentive pay, including stock ownership.
Verified Answer
Learning Objectives
- Understand the drawbacks of various forms of incentive pay, including stock ownership.
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