Administration November 4, 2002

Tech Workers Still Have Options

April 23, 2001 (PLANSPONSOR.com) - Technology companies are still offering stock options as part of their compensation packages, though now tailored with today's more volatile markets in mind, a new survey finds.
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The joint survey, conducted by Unifi Network, a subsidiary of PricewaterhouseCoopers and the National Association of Stock Plan Professionals, questioned 113 US listed technology companies.

While hi-tech companies still offer stock plans as a recruitment and retention tool, they have begun to shift to shorter option terms and vesting periods, as well as more frequent grants in an effort to counter the problem of a more uncertain market.

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Survey results showed that:

  • Nearly 85% of new economy companies offer employee stock purchase plans, compared to 62% of those in other industries;
  • Among those surveyed, 74% grant stock options to employees at all levels, though salary grade and performance are the key considerations in determining the number granted;
  • While 71% of hi-tech companies grant annual options, close to 10% schedule more frequent grants, allowing for different exercise prices throughout the year.

Employees at hi-tech companies were found to be more educated about stock options and more likely to receive plan material via the Internet. Not surprisingly, in view of the fact that half the companies surveyed provide stock compensation seminars to their employees. 

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