Companies Have Many Reasons to Use Deferred or Future Compensation

Companies Have Many Reasons to Use Deferred or Future Compensation

Fulcrum Partners Fulcrum Partners NEWS

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.