While it might seem like an obvious motivator the decision of whether or not to allow Employee Share Plan access to PEO employees doing work for your company is not always a straightforward decision explains Marlene Zobayan, of Rutlen Associates LLC.
“Granting equity to individuals who are not legal employees of the issuing company group can create all sorts of complications. The complexities vary by country and, in each case, the company should perform its due diligence before making the grant,” she says, urging caution on the matter and suggesting that companies first of all review the terms of the contract agreed with their PEOs to ensure they are aligned.
As a small-to-medium sized business, or maybe a company that has expanded internationally into a new territory, there are many advantages to using a PEO (Professional Employer Organization) or Employer of Record (EOR). Where a company does not have a local corporate presence, a large pool of potential employees available to them or does not yet have the breadth of expertise or system capabilities for HR, Payroll and other functions PEOs are of great benefit, freeing up valuable resources since they are effectively hiring out the required employees to you.