Loss Of Stock Options: Abusive Or Oppressive?

The appeal of stock option plans (SOP) is undeniable. Indeed, by linking employees' personal gains to the growth of the company's share value, a SOP offers a flexible form of compensation as well as a long-term incentive program.

That being said, is it lawful to stipulate that an employee will lose his rights to unexercised stock options should his/her employment be terminated for any reason? That is the question the Quebec Court of Appeal had to answer in Premier Tech ltée c. Dollo, 2015 QCCA 1159.

In this case, the Court of Appeal ruled that a provision in a SOP stipulating that an employee will lose his/her right to unexercised stock options upon termination of employment is not inherently abusive.