- One of the most frequent problems faced by business owners is staff turnover.
- The constant change of workers makes it difficult to meet group objectives.
- This new scheme allows collaborators to acquire shares of the startup in which they work at a preferential price.
All entrepreneurs aspire to have their own company. It is a valid wish that can be fulfilled, although it requires a lot of effort and financial investment. But if you already got it, you know that there are many responsibilities on you. One of the most frequent problems that you have to face is the staff turnover and to prevent it from happening in your environment you can resort to the strategy Stock Options.
The secret to any organization is teamwork. The participation of each element is essential to meet the general objectives. But just like with a chair, if one of the legs fails, everything falls down.
The sum of individual efforts generates better group results
With the above in mind, after finding the perfect collaborators, the last thing you want is for someone to leave. Although the reality is that it is something difficult to achieve. Sometimes internal conflicts and job offers from other organizations cause them to decide to change companies.
The staff turnover It has various negative effects for all companies. The constant arrival and departure of collaborators decreases productivity, affects the mood of work groups and, consequently, directly impacts the income and profitability of the organization. The loss of valuable talent slows down the possibility of achieving the goals set.
The latter can be a major obstacle for the startup development, companies that are characterized by their innovative business models and their rapid growth rates. These types of platforms have had to develop new mechanisms to hire, retain and motivate their collaborators. One of the alternatives against personal turnover is offering stock options to your employees. Do you know what it is?
Said scheme allows collaborators to acquire shares of the startup in which they work at a preferential price. In this way, employees obtain an incentive to continue working in the organization and develop both personally and professionally. This measure can have a positive impact in terms of the turnover rate.
“The stock options plan represents a powerful motivator to retain and attract talent. The possibility of buying shares at a preferential price allows employees to obtain a direct benefit from the growth of the company, increasing motivation and, consequently, productivity and efficiency increase”, assures Iván Guzmán, partner of the firm BlackBox Startup Law, specialized in providing legal advice for startups.
What is the benefit of stock options and how does it work?
A stock option plan represents benefits for the employees and the startup that considers this system. Collaborators must be clear about the rules, mechanisms and times to carry out the exercise.
Offering a plan of this type generates permanence and growth incentives for employees, which at the same time allows startups to provide benefits for their employees without the need to destabilize the efforts required for their development.
“It is important for the company to take into account the applicable ISR withholding tax rules at the time the employee acquires the shares, an issue that tends to be ignored and could generate negative consequences for the company.”
Thus, stock options has shown to combat staff turnover. The reason is because the employees really are part of the company. By holding financial stocks they have an additional reason not to switch companies. This is more likely to form long-term working relationships.