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Equity Grants to PEO Workers: Plan Design and Governance, Tax Implications, Foreign Employee Issues, and More

Note: CPE credit is not offered on this program

Recording of a 90-minute premium CLE video webinar with Q&A

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Conducted on Wednesday, November 16, 2022

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This CLE webinar will provide employee benefits counsel with an overview of the legal and tax issues for equity grants to professional employer organization (PEO) workers. The panel will discuss essential plan design and governance issues, critical tax implications and restrictions, challenges for foreign employees, and implementation considerations.

Description

Multijurisdictional companies, or those seeking to expand into new jurisdictions, typically turn to PEOs to engage local workers. At times, these companies may consider offering equity grants to PEO employees. However, such arrangements involve significant risks, including labor and employment law risks, tax implications, and other risks directly impacting a company's compensation and equity program.

A PEO is a third-party employer that hires workers as its direct employees to administer payroll and benefits, while those workers provide services to another company. If a company grants equity to these PEO employees, it will be subject to specific tax and legal implications and challenges because granting equity to PEO workers can be significantly different from granting it to direct employees or independent contractors.

In addition, companies preparing to grant equity in a new jurisdiction must confirm the grantee’s status under local law which can profoundly impact equity plan compliance as well as the local compliance obligations and tasks that the PEO is willing to undertake.

Listen as our panel discusses best practices for structuring equity grants to PEO workers, plan design and governance issues, critical tax implications and restrictions, challenges for foreign employees, and implementation considerations.

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Outline

  1. Plan design and governance issues
  2. Tax obligations and restrictions
  3. Key cross-border considerations
  4. Regulatory considerations
  5. Best practices in structuring equity grants to PEO workers

Benefits

The panel will review these and other high priority issues:

  • What plan design and governance impact equity grants to PEO employees?
  • What are the essential legal considerations for granting equity to PEO workers?
  • What are the tax implications and pitfalls to avoid for the company and PEO workers?
  • What are the labor and employment law implications?
  • What are best practices in structuring equity grants for counsel and companies?

Faculty

Klementz, Barbara
Barbara Klementz
Partner
Baker McKenzie

Ms. Klementz is the chair of Baker McKenzie’s North American Compensation Practice. She has practiced in the area...  |  Read More

Zobayan, Marlene
Marlene Zobayan
Partner
Rutlen Associates

Ms. Zobayan has over twenty years of international tax and benefits experience, including global equity plans,...  |  Read More

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