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.

Related Topics:
Incentive - Business - Employee - Salary - Bonus

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

Related Topics:
Publicly traded companies - Shares

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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.

Related Topics:
United States - Profit sharing plan - Retirement plan - 401(k) plan

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