How much does the market dictate when it comes to compensating your employees?<\/p>\n
All employees must be paid in cash in amounts to least to satisfy the minimum wage laws established by federal and state laws. Employees may receive equity in addition to cash payments, but due to tax and other complexities, it is generally not feasible to grant them equity in lieu of minimum cash wages. Although the market may reflect standard salaries for different types of positions, there is no requirements that employees receive any more than minimum wage, and the wages employees receive often depend on how large and established their employer is.<\/p>\n
Companies will often grant employees equity (or options to purchase equity) as part of their compensation package. Depending on the success of the company, the equity may ultimately be worth more than the cash compensation the employee may otherwise have received. So equity is often an important recruiting mechanism and retention tool \u2014 especially where the company is cash-strapped and needs to pay below-market cash wages. Equity compensation may also better align management goals with shareholder interests.<\/p>\n
Employees have become more savvy about both their cash and equity compensation and base their compensation decisions on whether they believe their overall compensation package \u2014 cash plus equity \u2014 are competitive with what they should expect from a similarly situated employer in their industry. As a result, what is required to compensate the employee of your choice will vary based on market factors and the industry in which you operate.<\/p>\n
Attorney Advertising. Prior results do not guarantee a similar outcome. Photos within are not of clients or firm personnel.<\/em>\u00a0\u00a9 2014 Wilmer Cutler Pickering Hale and Dorr LLP.<\/i><\/p>\n","protected":false},"excerpt":{"rendered":" How much does the market dictate when it comes to compensating your employees? All employees must be paid in cash in amounts to least to satisfy the minimum wage laws established by federal and state laws. Employees may receive equity in addition to cash payments, but due to tax and other complexities, it is generally […]<\/p>\n","protected":false},"author":915,"featured_media":6647,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[43902],"tags":[],"class_list":["post-6580","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-professional-development"],"acf":[],"yoast_head":"\n