By Andrew Pendleton
Introduction
Financial participation is the provision by companies of schemes which enable their workers to share in company profits and/or ownership. These schemes offer both opportunities and risks for workers. On the one hand, financial participation can supplement wages and salaries, thereby enabling workers to increase their income and wealth. On the other hand, the variability of profits and share prices poses risks to employees. Employees may lose as well as gain income and wealth. For this reason, financial participation is controversial and some trade unions are wary of it.
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