Difference between Golden Handcuffs and Golden Parachutes
Basis |
Golden Handcuffs |
Golden Parachutes |
---|---|---|
Purpose |
Golden handcuffs are used to retain key executives and employees in a company for some time. It is designed to prevent employees from leaving the organisation. |
Golden parachutes aim to provide financial security to managers during mergers or acquisitions where there is a risk of unemployment due to change. |
Contents |
Golden handcuffs often include long-term incentives such as restricted stock units (RSUs) or stock options that vest over time. These incentives are only valid if employees have been with the company for a certain period. |
Gold parachutes include separation, equity capital, regular benefits, and other financial incentives to reduce the impact of mergers or senior management buyouts. |
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