Profit-sharing

Profit sharing, when used as a special term, refers to various incentive plans introduced by businesses that provide direct or indirect payments to employees that depend on company\'s profitability in addition to employees\' regular salary and bonuses.

In publicly traded companies these plans typically amount to allocation of shares to employees.

Europe

Management\'s share of profits

The share of profits paid to the management, or to the Board of Directors is sometimes called the tantième [1] UBS Dictionalry of Banking: Letter M, "management\'s share of profits" \'Share of profits\'. This French language term is generally applied in describing the business and finance practices of certain European countries -, including Germany, France, Belgium, and Sweden. It is usually paid in addition to the manager\'s (or director\'s) fixed salary and bonuses (bonuses usually depend on profits as well, and often bonuses and tantieme are treated as the same thing); laws vary from country to country.

USA

Main article: Profit-sharing agreement (USA)

In the United States, a profit sharing plan can be set up where all or some of the employee\'s profit sharing amount can be contributed to a retirement plan. These are often used in conjunction with 401(k) plans.

See also

• Retirement plans in the United States

References

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