Jump to content
House Price Crash Forum
Sign in to follow this  
interestrateripoff

Asda Staff Take Home £3,000 Payout

Recommended Posts

http://www.bbc.co.uk/news/business-23223794

Some 19,000 Asda staff will receive record payouts averaging £3,240 under parent company Wal-Mart's Sharesave scheme, the supermarket chain has said.

The scheme allows staff to set aside between £50 and £250 a month over three years, in return for a share bonus.

The payouts earned by staff this year vary from £3,000 to more than £15,500, depending on how much staff put aside.

The windfalls have been plumped up by Wal-Mart's rising share price and are worth about 170% of the amount saved.

..

"This record bonus pot reflects the success we've seen this year, all of which is down to the hard work and commitment of our colleagues across the business," said human resources head Hayley Tatum.

"Giving our colleagues the chance to save each month risk-free is just one of our ways of saying thank you, and a great way to ensure that they reap the rewards of their exceptional efforts."

Hmmm risk free buying shares?? Not sure I agree with that.

I wonder what would happen to this scheme if the share price fell?

Share this post


Link to post
Share on other sites

http://www.bbc.co.uk/news/business-23223794

Hmmm risk free buying shares?? Not sure I agree with that.

I wonder what would happen to this scheme if the share price fell?

I do not know the details of the scheme but from others that I see, it is indeed risk free.

Normally, it is structured as a saving account that can be converted into shares at maturity if it is profitable, otherwise, they got the cash back (and plus interest in the past when base rate was somehow higher).

Edited by easy2012

Share this post


Link to post
Share on other sites

Hmmm risk free buying shares?? Not sure I agree with that.

I wonder what would happen to this scheme if the share price fell?

Clearly you have never been offered a sharesave scheme yourself so you have no idea how they work. If the price has fallen then you don't take the shares but simply get the cash you put aside back. AFAIK you can't lose with sharesave schemes, for once your cynicism is misplaced.

Share this post


Link to post
Share on other sites

I do not know the details of the scheme but from others that I see, it is indeed risk free.

Normally, it is structured as a saving account that can be converted into shares at maturity if it is profitable, otherwise, they got the cash back (and plus interest in the past when base rate was somehow higher).

so you are saying a "payout" is really return of capital??

Next Time I cash in my savings, ill think of it as a payout.

Share this post


Link to post
Share on other sites

Clearly you have never been offered a sharesave scheme yourself so you have no idea how they work. If the price has fallen then you don't take the shares but simply get the cash you put aside back. AFAIK you can't lose with sharesave schemes, for once your cynicism is misplaced.

Its not a form of companies buying their own shares and getting the employee's to pay for it then? As you say it sounds a decent scheme, and what class are the new shareholders? Can they vote at the AGM etc..Genuinely interested, not trying to make a cynical point.

Edited by Secure Tenant

Share this post


Link to post
Share on other sites

so you are saying a "payout" is really return of capital??

Next Time I cash in my savings, ill think of it as a payout.

Compared to losing it all on a share going into administration or even just dropping 10%, yeah, it's a payout. Mind you, if the share had gone boom, then probably their jobs would too. Wonder what would happen to their share 'Savings' then?

Share this post


Link to post
Share on other sites

Its not a form of companies buying their own shares and getting the employee's to pay for it then? As you say it sounds a decent scheme, and what class are the new shareholders? Can they vote at the AGM etc..Genuinely interested, not trying to make a cynical point.

Last time I had the opportunity to join a sharesave scheme was about 8 years ago so I don't remember every detail but I think the shares were newly issued shares and they were ordinary shares with voter and dividend rights, at least in my case.

This article seems to describe quite well how they work:

http://www.telegraph.co.uk/finance/personalfinance/investing/8587463/How-employee-share-schemes-work.html

Edited by The Eagle

Share this post


Link to post
Share on other sites

Clearly you have never been offered a sharesave scheme yourself so you have no idea how they work. If the price has fallen then you don't take the shares but simply get the cash you put aside back. AFAIK you can't lose with sharesave schemes, for once your cynicism is misplaced.

Nope I've never been employed by anyone who offers it, and it's rare to come across something that is "risk free" hence the cynicism as usually there's a catch.

Share this post


Link to post
Share on other sites

Nope I've never been employed by anyone who offers it, and it's rare to come across something that is "risk free" hence the cynicism as usually there's a catch.

RF only if they take the cash or take the shares and cash them. ;)

Share this post


Link to post
Share on other sites

Nope I've never been employed by anyone who offers it, and it's rare to come across something that is "risk free" hence the cynicism as usually there's a catch.

The catch is you need to accept the stigma of being employed by Asda.

Share this post


Link to post
Share on other sites

AFAIK the schemes are setup as a cash savings plan, but with the additional benefit of an attaching option to buy the shares at a discount (anything from 0 to 25%, at employers discretion) to the price of the share at the date the plan was started.

The cash savings element is dictated by HMRC to be priced off governement bond/swap rates - so the interest is currently paltry (in fact 2013 the interest rate is zero!). In the past the interest rate was around 3% so you effectively had a tax-free savings plan with a free option attached paid for by your employer. Not so generous now but with savings rates so low elsewhere anyway not a bad place to put your money.

The cash is held separately from the assets of the employer so if they were to go bust you would recieve your money back, although obviously with no gain from the now worthless options.

Share this post


Link to post
Share on other sites

sounds like a share option.

Let's see. The price of Walmart right now is 76.55. If they give employees the option to buy at 76.55 in July 2015, then employees can choose whether to exercise the option. If the share price is higher two years hence, they make a profit (similar to what appears to have just happened). If it's lower, they can let the options lapse, and just retrieve the 76.55 cash from the savings scheme.

Share this post


Link to post
Share on other sites

Anyone who wears the Green Tabard of Servitude deserves a few quid extra

Wonder if the serfs provided by Jobcentre Plus can participate?

Share this post


Link to post
Share on other sites

It's a 3 or 5 year locked in speculative punt this year.

With interest or bonus on the savings then yes it's it's quite risk-free but with that not happening this year then it's down to the performance of the shares.

Previously the share option was a bonus (and a tax free one at that), this year it overtly forms part of the protection of the savings from inflation.

For those who've never participated in one of these in the past it WAS a good (and risk free) way of getting a bump in income; this year it's not risk free.

Share this post


Link to post
Share on other sites

Its not a form of companies buying their own shares and getting the employee's to pay for it then? As you say it sounds a decent scheme, and what class are the new shareholders? Can they vote at the AGM etc..Genuinely interested, not trying to make a cynical point.

Its essentially a tax avoidance measure, an employee can receive up to 3k per year in its employers shares without tax liability so long as the scheme is an HMRC "approved" one.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 246 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.