Private Company Incentive Compensation For A Cross-border Workforce: Key Considerations

Properly designed incentive arrangements can help attract, retain, and motivate key talent. In this article, we discuss common forms of incentive arrangements for private companies, and offer certain key considerations that companies should keep in mind when implementing such arrangements for a cross-border workforce.

Stock options

Stock options are contractual rights to purchase a specified number of shares of a company, subject to the satisfaction of certain vesting conditions, at a fixed exercise price. Stock options are commonly used by privately held companies because both Canada and the U.S. provide preferential tax treatment, and they are relatively simple to administer.