While it seems like layoffs are happening left, right, and centre these days — because, well, they are — some companies are going to great lengths to retain workers.
Driving the news: Walmart managers in the U.S. can now make upwards of US$400,000 a year after the world’s biggest retail store granted them the opportunity to earn up to $20,000 in annual stock grants and bonuses of up to 200%, in addition to increasing base salaries.
- Managers who work at Walmart Supercentres, the massive stores where you can find everything from groceries to flatscreen TVs, will be the highest earners.
Why it’s happening: After stabilizing the lower rung of its workforce through wage hikes, Walmart is fighting to ensure it can find and retain managers. To do this, Wally World wants to empower them to “act like owners,” and get some of the perks of ownership in return.
Zoom out: Employee ownership plans have been on the decline in recent years, but Walmart’s big bet on doling out stock options could breathe new life into an old idea.
- Walmart isn’t the only one into it. Private equity giant KKR has long granted shares to employees at portfolio companies and is now working to popularize this tactic.
In Canada: A new tax exemption came into effect this year meant to motivate companies to create employee ownership trusts — accounts that manage the sale of shares to employees.
Why it matters: Many studies have implied that employee ownership plans improve employee productivity, something that’s been plaguing the economy over the past few years.
Plus: Employee ownership could help the economy handle the wave of small business owners who are set to retire without succession plans. Workers can simply buy the rest of the company, removing the hassle of finding a buyer and keeping it in trusted hands.—QH