Asked by Samantha Valadez on Jul 22, 2024

verifed

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.
verifed

Verified Answer

PT
Ploypassorn TantisewekulJul 24, 2024
Final Answer :
A
Explanation :
Stock ownership as a form of incentive pay primarily benefits employees financially when they leave the organization or sell their shares, not during their tenure or through regular income.