Vesting Cliff
Content
Definition
A Vesting Cliff is the period of time before shares in an employee stock option plan or benefits in a retirement plan are unconditionally owned by an employee.
Usage and Context
A vesting cliff is the initial period before an employee fully owns shares or benefits in a stock or retirement plan.
Frequently asked questions
- What is a vesting cliff? A vesting cliff is the initial period before an employee earns full ownership of stock options or benefits, after which vesting occurs all at once.
- What is the meaning of cliff period in ESOP? The cliff period in ESOP (Employee Stock Ownership Plan) is the initial time frame before an employee fully earns their stock options or shares.
- What is vesting quizlet? Vesting on Quizlet means the process where an employee earns the right to fully own benefits like stock options or retirement funds over time.
Benefits
A vesting cliff delays full ownership of shares or benefits, ensuring commitment from employees.
Conclusion
A vesting cliff establishes a waiting period before employees fully own shares or benefits, ensuring commitment.
