Which plan allows employees to share in company profits directly?

The profit-sharing plan is designed specifically for employees to receive a direct share of the company's profits. This type of plan aligns employee interests with the overall performance of the organization, incentivizing employees to work towards the success and profitability of the company. Under a profit-sharing plan, employees may receive bonuses or contributions to their retirement accounts based on the company's profitability, which can encourage greater productivity and morale.

Other plans, such as incentive pay or gain-sharing plans, may also offer financial rewards based on performance but do not directly link compensation to overall company profits in the same way. For instance, incentive pay typically rewards employees for meeting specific performance targets, while gain-sharing focuses more on collaboratively achieving improvements in productivity and efficiency on a team or departmental basis rather than sharing in overall profits. Retirement plans, while important for long-term financial security, do not provide employees with immediate compensation linked to the company's profitability.