High-tech workers will gather in Silicon Valley next week for a raucous demonstration – dubbed the “Reality in the Valley” – to protest a proposal requiring companies to expense all stock options for employees.
Sound familiar?
In 1994, there was the “Rally in the Valley,” so dubbed by its organizer, at which workers protested a similar plan. The business lobby won that battle handily, with the Financial Accounting Standard Board’s backing down from its proposal.
Now, the FASB is back with a new proposal, and opponents have united for a common cause: saving stock options. The pay perk was widely blamed for fueling many of the corporate scandals of the 1990s, including Enron and WorldCom.
But for years, the tech industry has balked at expensing options, saying they give employees a financial stake in their companies’ success, which ultimately benefits all shareholders.
Employees of tech companies such as Cisco and Intel are planning to gather in Palo Alto, Calif., just down the street from where the FASB is holding one of two roundtable discussions to consider expensing options.
The rally will be staged in front of City Hall, where workers will be given T-shirts that read, “I am the face of stock options.”
“We’re not trying to compare this to 1994,” said John Earnhardt, who handles police and government affairs for Cisco, which is one of the biggest issuers of stock options. “We’re just trying to make it as clear in as many ways as possible that this is an important issue.”