Share option plans:
A) Are illegal in Australia
B) Give employees the right to purchase company shares at a future date at a predetermined price
C) Directly award bonuses to employees based on cost savings and increased labour productivity
D) Tend to weaken employee commitment to the organisation

Question

Quizplus · Accepted Answer

Share option plans give employees the right to purchase company shares at a future date at a predetermined price. They are a common form of employee ownership and incentivization in many countries, including Australia. Options are not illegal in Australia as suggested in choice A. The purpose of share options is to align employee interests with company performance and incentivize long-term commitment and loyalty, so choice D is incorrect. Choice C describes a different type of bonus plan based on cost savings and productivity, not share options.

Share Option Plans