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Myth #4: Employee Ownership Leads to Two Corporate Excesses: Employee Entitlements and Executive CompensationĀ 

by: Scott, Bill
Source: The Foundation for Enterprise DevelopmentĀ 

Many who first hear of the idea of employee ownership react with skepticism. If employees are allowed to shape company policies, say the skeptics, their naïve and self-serving impulses will invariably lead to the gold-plating of compensation and benefits programs, driving up costs and damaging the competitiveness of the firm. Very simply, the company will end up in bad shape—and perhaps even in bankruptcy—because employees will push for what employees always want: more pay and less work.

If those skeptics would care to take a look, they would discover a very different reality at Science Applications International Corporation (SAIC)—the largest employee-owned science and engineering firm in the United States. SAIC's employee benefits are actually quite modest relative to what other large employers offer. Medical plans, retirement contributions, paid leave—all are reasonable, but lacking in luxury. Entitlements, in fact, are rigorously managed—and the consensus of employees throughout the organization supports that.


discipline
Human Resource Management
topic
Culture of Ownership
Employee Stock Ownership Plans
ESOPs
industry
product
region
country
company
SAIC