Companies Have Many Reasons to Use Deferred or Future Compensation

Companies Have Many Reasons to Use Deferred or Future Compensation

April 20, 2017
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Fulcrum Partners
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Consider corporate objectives.

Future compensation can:

  • Drive performance.
  • Drive corporate messaging.
  • Incentivize and retain new hires.
  • Replace lost benefits (“make whole” arrangements) for new hires.
  • Improve employee morale.
  • Award spot bonuses or special project bonuses.
  • Manage compensation subject to clawback.
  • Incentivize employees to accumulate company stock on a tax preferred basis.
  • Supplement existing retirement programs and Social Security.
  • Facilitate financial wellness, creating consistency with other companies’ initiatives.
  • And inspire retention.

Retention is a Reflection of Loyalty

  • Loyalty occurs when the needs of both parties are satisfied
  • Deferring income is an act of trust and faith between the company and the employee.
  • Employers and employees who partner for their common interests, achieve strategic success through effective plan sponsorship. This reveals loyalty from employer to employee and from employee to employer.