Sebi on Tuesday relaxed the vesting period requirement under the employee stock option schemes of listed companies in case of death of an employee, a move aimed at providing relief to families of the deceased staff amid the coronavirus pandemic. The relaxation will be available to all such employees who died on or after April 1, 2020, the Securities and Exchange Board of India (Sebi) said in a circular.

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The Share Based Employee Benefit (SBEB) Regulation provides that there will be a minimum vesting period of one year in case of employee stock options and Stock Appreciation Rights (SAR). In the event of death of an employee, all the options, SAR or any other benefit granted to him or her under a scheme till such date will vest in the legal heirs or nominees of the deceased employee.

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”In view of the COVID-19 pandemic situation, to provide relief to the families of the deceased employees of listed companies, it has been decided the provisions under the SBEB Regulations relating to minimum vesting period of one year shall not apply in case of death (for any reason) of an employee,” Sebi said in a circular.

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In such instances, all the options, SAR or any other benefit granted to such an employee will vest with his/her legal heir or nominee on the date of death of the employee.

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First Published:Jun 17, 2021 11:46 AM IST