How Employers Are Thinking About Employee Stock Purchase Plans in 2026

For employers considering an ESPP or thinking about restructuring, there are a number of regulatory, financial, and employee attraction and retention considerations. This article shares insights into how employers are responding to these pressures and the trends shaping the broader market.

The Current ESPP Landscape

From an employer’s perspective, an employee stock purchase plan can be a strategic compensation benefit helping to directly align employees’ financial incentives with those of shareholders and the business. At the time of this report, a slight majority of employers offer an ESPP (52%).¹

This decision often hinges on several considerations, including the strength of ownership culture across the workforce, how closely participation tracks market-standard rates, the expense borne by the company, and the cash flow available to employees.

Variance by industry

The data shows meaningful differences in ESPP adoption by industry. Employers in the Technology, Media, & Telecommunications industry had the highest rate of ESPP availability (68%), while employers in the Real Estate sector were least likely to offer ESPPs (17%). This range suggests that employers weigh factors such as industry-specific talent dynamics, capital structure, and compensation philosophy when deciding whether to offer the benefit.

Determining ESPP eligibility

While employers use a number of metrics to define eligible participants for ESPPs, the most common is hours worked per week (36%). This can effectively remove part-time workers from eligibility pools. Tenure (32%) is also frequently used to limit participation eligibility. This can help encourage loyalty and support employee retention efforts.

Exactly half of the plans reviewed apply a single metric to limit employee eligibility, indicating a preference for administrative simplicity. 32% of employers take a two-metric approach, while the remaining 18% utilize three limitations.

Most common ESPP structures

Employers that offer ESPPs fall into one of three broad plan structures: Qualified Section 423 plans, nonqualified plans, and direct purchase plans.

Qualified plans made up the largest share of plans reviewed (76%), while nonqualified (14%) and direct purchase plans (10%) appeared less frequently but may offer practical advantages for certain employer objectives.

Qualified Section 423 Plans

Qualified Section 423 plans (76%) may be particularly appealing to employers because of the potential tax benefits they can provide to eligible US employees. At the same time, they require strict regulatory compliance, shareholder approval, nondiscrimination rules, and the annual statutory purchase limit ($25,000 per participant).

This table represents the most common methods of designing each individual structural component in the 121 plans reviewed. This is not meant to be representative of the most common holistic Qualified Section 423 plan structure.

Nonqualified Plans

Nonqualified plans represent a smaller share of ESPPs reviewed (14%) but employers are looking at the design as an option that introduces more flexibility, eases administrative needs, and simplifies tax treatment.  Because these plans are not subject to the same Section 423 framework, they can support a broader range of eligibility rules and incentive structures. This may be particularly relevant for multinational employers looking for a more consistent employee experience across jurisdictions.

* Purchase Discounts are offered by the remaining 22% of employers. 40% of those employers that offer purchase discounts set the discount at 5%.

This table represents the most common methods of designing each individual structural component in the 121 plans reviewed. This is not meant to be representative of the most common holistic nonqualified plan structure.

Direct Purchase Plans

Direct purchase plans were the least common structure offered by employers (10%). These plans can provide a simpler way for employees to buy company stock, but they generally offer fewer plan-design levers and potential tax planning opportunities than qualified or nonqualified ESPPs.

This table represents the most common methods of designing each individual structural component in the 121 plans reviewed. This is not meant to be representative of the most common holistic direct purchase plan structure.

Next Steps

For employers, the right ESPP design will depend on how the benefit fits into the broader total rewards strategy. Eligibility rules, offering frequency, contribution limits, incentive structure, and pricing methodology can all affect how employees interact with the plan and how the employer manages cost, administration, and alignment with business priorities.

To discuss how ESPPs and other benefits could impact your organization, connect with your Goldman Sachs Ayco team or start a conversation today.

¹ Data is based on a review performed July–August 2026 of the employee stock purchase plans at 121 companies.  

Disclosures

Advisory services offered by Goldman Sachs Wealth Services, L.P. (“Goldman Sachs Wealth Services”), a registered investment adviser, affiliate of Goldman Sachs & Co. LLC (“GS&Co.”), and a subsidiary of The Goldman Sachs Group, Inc., a worldwide, full-service investment banking, broker-dealer, asset management, and financial services organization. Goldman Sachs Ayco is a brand of Goldman Sachs Wealth Services. Brokerage services are offered through GS&Co. and Mercer Allied Company, L.P. (a limited purpose broker-dealer), both affiliates of Goldman Sachs Wealth Services and members FINRA/SIPC. For more information about Goldman Sachs Wealth Services offerings, visit our Full Disclosures. 

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