More details to this question:
Like a law firm has junior partner and then senior partner, can a corporation have the same kind of thing? For example, when an employee performs sufficiently and reaches promotion level, they are promoted to partner and he/she buys company stock. After achieving partnership, they may continue to be promoted to an executive position - Vice President, etc.
1 ANSWER
The owners of equity in partnerships are partners. Technically, the owners of equity in corporations are shareholders. It can be important that shareholders, even 50% shareholders, not refer to themselves as partners, since partners can be personally liable for partnership obligations. Shareholders are (with very rare exceptions) not personally liable for corporate obligations, which is one of the main reasons that people incorporate, rather than forming partnerships.
Corporations can award shares, or the right to buy shares, to employees as part of their compensation, thereby affording the employees the opportunity to become part owners of the corporation.
Answered on Feb 05th, 2014 at 3:56 PM