In fact, rather than just reward senior management, an old economy concept, new economy employers are attempting to share the wealth. Each nonexempt employee who we have spoken to regarding stock options becomes noticeably excited at the opportunity. These employees do not want extra overtime pay because their stock options appreciated. They view their salary and stock option appreciation as very separate items. However, a member of the Department of Labor, focusing solely on a narrow interpretation of language in some federal regulations, without viewing the big picture, undercuts that opportunity for nonexempt employees.
Many employers are anxious to take steps to reward employees, either monetarily or with flexibility.
These opinion letters have a chilling effect on the employer community. Even when the opinion letters are revoked or distinguished, there is no clear guidance left for the employers. Employers want to reward employees with a potential upside should they remain with the company. If their options vest and the company stock goes up in price, there is a resulting gain for the employees. Many employers will now wait to provide stock options for nonexempt employees until this issue is resolved.