ESPP
Business & Finance abbreviation · Human Resources
| Stands for | Employee stock purchase plan |
|---|---|
| Categories | Business & Finance |
ESPP stands for Employee stock purchase plan, a human resources abbreviation.
Plan that lets employees buy company stock through payroll deductions, usually at a discount of up to 15%, at the end of an offering period. Many plans include a "lookback" that uses the lower of the stock price at the start or end of the period.
Example: With the lookback, our ESPP shares cost 15% less than the lower of the two prices.
Usage notes
Qualified plans under section 423 of the Internal Revenue Code let employees buy up to $25,000 worth of stock per year, measured at the grant-date price, without tax at purchase. Selling soon after buying locks in the discount, while holding at least two years from the offering date and one year from purchase earns more favorable tax treatment.
Related abbreviations
More human resources abbreviations
- EEO-1 – EEO-1 Component 1 report
- eNPS – Employee Net Promoter Score
- EOE – Equal opportunity employer
- EOR – Employer of record
- ER – Employee relations
- ERG – Employee resource group
- EVP – Employee value proposition
- EX – Employee experience
- FLSA – Fair Labor Standards Act
- FMLA – Family and Medical Leave Act
- FT – Full-time
- FTE – Full-time equivalent