Incentive Pay Plans

The Power of Long-Term Incentive Plans: Your Comprehensive Guide to LTIPs

Available from Compensation Resources

The Power of Long-Term Incentive Plans: Your Comprehensive Guide to LTIPs

Content Summary

Annual bonuses keep people motivated today. But what keeps your highest-impact contributors committed for the next three to five years? This guide breaks down the mechanics of long-term incentive plans (LTIPs), from phantom stock and performance units to cash-based programs, and walks through the design decisions that determine whether a plan drives real results or just adds cost. You'll learn how to select performance metrics participants can actually influence, structure vesting schedules that balance retention with motivation, tier participation by role and impact, and stay on the right side of IRC Section 409A.

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