Canadian Human Resources
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Stock options have arrived in Canada

28 February 2001 - Stock options are becoming an important recruitment and retention tool for top talent in Canada. They benefit employees but also help companies grow - businesses with stock option plans are expected to expand as much as 11% faster than those without, according to Assessing The Options: Stock Option Plans in Canada, a new report by The Conference Board of Canada. The report also shows that smaller organizations which are smaller and concentrated in technology or other high-skill industries have the most aggressive stock option plans.

But stock option plans do not come without problems:

* When employees exercise their options to sell the result can be a lowering of a company's earnings per share index.
* As some dot.com employees have discovered, stock options can become almost worthless when a company's share price declines.
* There may be a weak link to employee performance if the a company's share value is growing but the company is doing poorly when compared to its competitors.

"In an increasingly tight labour market, compensation is a critical lever for organizations as they strive to attract, retain and motivate talented employees," said Prem Benimadhu, Vice-President with the Conference Board. "In an attempt to recruit and retain top talent, employers are now offering stock options to employees at all levels within the organization. And this is just the beginning."

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