1. Co-partnership: To issue shares to the employees at a price which is less than the market price is an example of co-partnership. It is one of the financial motivators. “Co-partnership implies both profit sharing and control sharing.” In short, it can be said that co-partnership is the plan by virtue of which employees become partners of the company. It improves the status of the employees. Consequently, they begin to take more interest naturally in the management of the organisation. Therefore, the efficiency of employees increases and a sense of responsibility develops in them.
Features:
i. The employees are also the shareholders of the company.
ii. The employees get dividend on the issued shares.
iii. The employees also participate in the management due to their shareholding.
2. Profit Sharing: By profit sharing we mean providing share in profit of the organisation to the employees besides their regular remuneration (salary/wages). The main goal of this incentive plan is to create the feeling of ownership among the employees for their organisation.
Features:
a. The employees participate only in profit.
b. The percentage of share in the profit is decided in the beginning of the year.
c. There can be no change in the percentage of the share of profit between the year once decided.
