Searching Pondering Equity-Based Long-Term Incentive Plans on page 29

” — Sue Holloway, content director, WorldatWork What’s Next As organizations continue to embrace artificial intelligence (AI), Sue Holloway, a content director at WorldatWork, expects to see continued growth in the importance of related performance metrics in executive incentive plans as more companies are faced with increasing pressure to demonstrate how AI: ;Drives efficiency;; ;Improves productivity; and,; ;Promotes innovation.; “This is more prevalent in short-term incentive plans and emerging but less common in long-term incentive plans,” she said.

The provisions potentially affecting Forms W-2 (including W-2AS, W-2GU and W-2VI) are: ;De minimis financial incentives (Section 113 of the SECURE 2.0 Act),;Roth Savings Incentive Match Plan for Employees (SIMPLE) and Roth Simplified Employee Pension (SEP) Individual Retirement Arrangements (IRAs) (Section 601 of the SECURE 2.0 Act), and;Optional treatment of employer nonelective or matching contributions as Roth contributions (Section 604 of the SECURE 2.0 Act).; For de minimis financial incentives , the SECURE 2.0 Act made changes designed to encourage employees to contribute to their employers’ 401(k) or 403(b) plans.

Employees who are part of a collectively bargained plan may not be subject to the expanded plan eligibility rules that apply to long-term, part-time workers after two years of service.

Among the findings: ;5% of plan participants account for 56% of total costs, and just 1% are responsible for 28%.; ;Claims once considered “high cost” at $50,000 now often start at $100,000, with multimillion-dollar claims increasingly common, driven by advanced treatments (e.g., gene therapy) or complex conditions (e.g., congenital disorders, transplants).; “Employers must take a more revolutionary approach to address both immediate cost pressures and long-term cost trends, especially since healthcare costs appear firmly on an upward trajectory,” said Courtney Stubblefield, a managing director within WTW’s health and benefits business unit.

Plan sponsors will increase their focus on evaluating and selecting retirement income solutions within DC plans, which broadens the plan sponsor’s responsibility from just accumulation to ensuring participants can achieve long-term retirement security.; ;Innovative product development.

Workspan Magazine article;WorldatWork’s Salary Budget Survey , research; For Everyone Mercer Projects 3.6% Total Salary Increase Budgets in 2025 , Workspan Daily article;Report: 1 in 3 Organizations Don’t Have a Pay Equity Strategy , Workspan Daily article;Understanding Base Pay-for-Performance and Merit Increase Guidelines , on-demand webinar;Base Pay Administration and Pay for Performance , course; Giving managers discretion in the allocation of merit pay increases can be empowering for both the giver and receiver.

We have to make sure the salary and incentive plans are aligned with our organizational strategy and goals.

Consider providing financial planning resources to help team members reach their short- and long-term savings goals.

Access a related Workspan Daily article on this subject: DOL Proposes Rule on Valuing Employer Stock Purchased, Sold by ESOPs; Access a bonus Workspan Daily Plus+ article on this subject: ;The Equity Alternative: Rewarding Employees Without Traditional Stock; Employee stock ownership plans, or ESOPs , are an alternative that is sparking growing interest and exploration as a succession plan, particularly by closely held or middle-market businesses for whom other ownership transition options may not be feasible.

Or are they stable, loyal and likely to stick it out for the long term?