An employee stock ownership plan (ESOP) is an employee-owner program that provides a company’s workforce with an ownership interest in the company. In an ESOP, companies provide their employees with stock ownership, often at upfront cost to the employees.

However, Employee stock ownership plans are just options that could be purchased at a specified price before the exercise date. There are defined rules and regulations laid out in the Companies Rules which employers need to follow for granting of Employee stock ownership plans to their employees.

ESOPs are crucial assets tools to reward employees and retain them by providing sense of ownership. They are probably the most valuable contribution that Startups make to the lives of employees who suffer low salaries and long hours while working in new Companies.As an entrepreneur you should know, What are Employee Stock Option Plans (ESOPs)? Importance of Employee Stock Option Plans? Whom to issue ESPOs? How to issue ESPOs? What are the Cost & Criteria to issue Employee Stock Option Plans? Benefits of ESOPs and Dos and Dont’s?

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