In Part I and II, I discussed getting an employment agreement in writing, understanding the salary component, and details of the equity. The next critical step to take in the negotiation of an employment package is:
- Don’t Forget the Fringe Benefits. Many executives overlook the value that fringe benefits and perquisites (“perks”) bring to an overall compensation package. These can be “found money” for the executive and a way for an employer to lure new talent into its ranks. Fringe benefits and perqs can take several forms and can add, in some cases, significant dollars to the compensation package. These include health, life, disability insurance, car payments/allowances, club dues, home security systems, executive physicals, and relocation expenses. The executive should also be mindful of the tax treatment afforded these benefits to avoid the surprise of incurring taxable phantom income.
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