Profit-Sharing Plan
/ˈprɒfɪt ˈʃɛərɪŋ plæn/
Definitions
- (n.) A retirement savings arrangement sponsored by an employer whereby employees receive a share of the company's profits, often contingent on company performance.
The company introduced a profit-sharing plan to incentify employee productivity.
Forms
- profit-sharing plan
- profit-sharing plans
Related terms
See also
Commentary
Profit-sharing plans are a form of defined contribution plan; precise allocation and vesting terms are key drafting considerations.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.