Searching Pondering Equity-Based Long-Term Incentive Plans on page 68

Uncertainty about whether another surge of infections might occur makes the long-term implications of short-term actions difficult to determine.

According to Julie Stich, vice president of content at the International Foundation of Employee Benefit Plans (IFEBP), employers/plan sponsors should: ;Review all new plans that were established after Dec. 29, 2022, to ensure compliance with automatic enrollment and escalation rules.; ;Update plan documents to reflect the new requirements.; ;Communicate the automatic features to employees, including opt-out options and investment choices.; Baker Donelson’s Robinson noted employers should take extra care to review their plan administration to ensure compliance with the new 2025 requirements of SECURE 2.0.

.; ;The ensuing long-term repercussions include income interruptions, lower salaries, delayed career progression , decreased short-term and long-term savings, and reduced Social Security benefits .; Additionally, pay inequity plays into the retirement gap, said Dena Faccio, the senior vice president of total rewards, employee relations and HR business partner-workplace solutions at investment company Voya Financial.

Some of the most common benefits within these plans, according to Carpenter, include: College funding alternatives for families of executives;Sabbaticals;Flexible retirement alternatives to qualified plans ;Choice funding for life events such as turning age 50 and purchasing a vacation home;Phantom equity arrangements when stock is not available to share;In-service payments above annual bonuses for short term retention subject to restriction; The appeal to younger executives is a shorter commitment to realize the benefit, with some plans triggered in as little as five years.

“They shouldn’t focus on one program, especially if their intentions or objectives are to make modifications based on the programs their people value.

The long-term effects of current working conditions remain to be seen, said Ulrich, who sees this lack of social cohesion as a contributing factor to the mass employee exodus that began in 2021.

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Planning Ahead While there will continue to be consternation about the economic climate and more noteworthy organizations tightening the purse strings, Davis said he expects highly skilled and technical talent to remain in demand the second half of 2022, which will require strong planning.

“Employers need to weigh their desire to hire any particular candidate or satisfy a short-term staffing need against the value of those provisions and the longer- and medium-term interests they protect,” Hartstein said.

“We continue to invest in our teammates and their priorities through competitive pay; industry-leading benefits and resources for physical, emotional and financial well-being; long-term career development tools and programs; and in our diversity, equity and inclusion efforts across the company, so that we continue to attract and retain the best talent.”