The Securities and Exchange Board of India (Sebi), has floated a consultation paper seeking to offer Employee Stock Ownership Plans (ESOPs) to non-permanent employees and non-executive directors of listed companies.
The seven-member group, chaired by Partner, S&R Associates Sandip Bhagat, has made several policy recommendations in its 141-page report, including combining both sweat equity and SBEB (share-based employee benefits) regulations.
Based on the recommendation of a working group, there is a proposal to change the definition of the word 'employee' to include workers on contract and gig workers, employees on probation or deputation and make them eligible to receive Employee Stock Ownership Plans (ESOPs).
“The expert group took note that keeping in mind the prevalence of such employment practices, non-permanent employees may be considered for eligibility to receive share-based employee benefits under the SBEB Regulations,” it added.
The expert group is of the opinion that non-executive director (who is not a promoter or member of the promoter group) should be eligible for ESOPs too.