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Re: EFES: FW: ESOPs and Regulation
I think you hit the nail on the head insofar as ENRON and the ESOP Association's refusal to back direct management by employees or their "factional" representatives.
The status quo for ESOPs leaves much to be desired. Currently, lower waged new workers are doublly disadvantaged. While I agree that in time they should build up their shares, I disagree with linking share accumulation to income and in waiting 12 months to begin. Each employee should receive the same number of "grant" shares (although they may get more by reinvesting dividends) and this accumulation should begin at day 1 of employment.
Mike Bindner
"Daryl.DArt" <Daryl.DArt@ul.ie> wrote:
-----Original Message-----
From: Marc Mathieu [mailto:marcmathieu@marcmathieu.be]
Sent: 31 March 2005 17:48
To: Daryl.DArt
Subject: Re: ESOPs and Regulation
Dear Daryl,
Thank you very much for this.
Would you please send it to efes@cog.kent.edu, I think it is of interest for
all.
With best regards
Marc
----- Original Message -----
From: "Daryl.DArt"
To:
Sent: Thursday, March 31, 2005 6:56 PM
Subject: ESOPs and Regulation
> Dear Marc
> I have read with interest the ongoing debate on regulation versus self
> regulation or laissez faire regarding employee stock ownership plans. I
have
> to admit it find it some what depressing that there should be any debate
at
> all concerning state regulation of these schemes. The long history
of
> employee ownership and profit sharing schemes points to the neccessity for
> regulation if the participants in these schemes are to enjoy any real
> participation, empowerment or security. There have been numerous
historical
> examples, particularly in the US where these schemes were used primarily
to
> benefit the company rather than employees. (General Accounting Office
Report
> see page 115 in my book). The most recent example was ENRON. The ESOP
> association claims it favours participation and empowerment for employees
> yet to my knowledge may still oppose any obligation to pass on voting
rights
> to employees. The argument of government regulation versus self
regulation
> is an old one but was heard again in the aftermath of ENRON - same old
self
> serving stuff.
> Finally many schemes in the US are not additional benefits for employees
but
> subsitutes for standard wages
or pensions - and as pensions are a very
> uncertain benefit. It is likely that the European Trade Union movement
will
> not support these schemes in the absence of fairly strict regulation to
> protect employee interests. In the US of course trade unions are of
little
> account due to their weakness and can be safely ignored.
> A brief glance at Chapter 3 Employee Stock Ownership in the US - Worker
> Capitalism would not go amiss and indeed might clarify the arguments
> regarding regulation. See D.D'Art 'Economic Democracy and Financial
> Participation; A comparative Study Routledge London 1992.
> Regards
> Daryl D'Art
>
>
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