Why You Should Stop Calling Them “Refresh Grants” in Stock Compensation

💡 The words you use in stock compensation planning matter more than you think.

One of the biggest misconceptions in equity compensation? Using the term “refresh grant” without realizing the expectations it sets for employees.

We recently published a stock compensation conversation with equity expert Ilene, and one surprising takeaway stood out: Stop calling them “refresh grants.”

Here’s why.

1️⃣ What’s Wrong with the Term “Refresh Grant”?

The problem with calling equity awards "refresh grants" is that it implies employees should expect them regularly—even if your company doesn’t actually operate that way.

🔹 What employees assume when they hear “refresh”:

• They will always have a certain level of stock vesting at all times.
• They will automatically receive new grants to maintain that level.
• Stock compensation is a guaranteed element of their total rewards package.

🔹 What many companies actually intend:

• Stock grants are performance-based and tied to company goals.
• They are not automatic or guaranteed like salary or bonuses.
• Equity is used as a retention tool for high performers—not a standard renewal process.

💡 If these two perspectives don’t align, employees may feel misled, leading to frustration and retention risks.

2️⃣ Align Stock Compensation Philosophy With Messaging

Key takeaway: Your stock compensation philosophy should match what employees expect.

HR and compensation leaders need to:
- Clarify internally whether stock grants are recurring, performance-based, or tenure-driven.
- Ensure managers understand the stock compensation philosophy before discussing grants.
- Align terminology with reality—if refreshes aren’t guaranteed, don’t use the word “refresh.”

🔹 Example: Many companies see stock as a long-term incentive for high performers—but they don’t always state this explicitly. This leads to confusion when employees expect stock renewals that aren’t actually part of the comp strategy.

💡 Solution: Define when and why employees receive stock grants and communicate this consistently.

3️⃣ How to Set Clearer Expectations Around Stock Grants

If your company doesn’t guarantee recurring stock grants, here’s how to fix the messaging:

✅ Stop using “Refresh Grant” if it’s not actually a refresh.

Instead, call it what it is:
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- “Performance Grant” – Awarded based on contribution and impact.
- “Promotion Grant” – Given when an employee moves up a level.
- “Retention Grant” – Used strategically to keep key talent.

✅ Make sure managers are trained on stock comp policies.

- Equip them with talking points so they can confidently answer employee questions.
- Provide documentation on stock grant policies and what employees need to do to earn more equity.

✅ Set clear expectations with employees.

- Publish guidelines on how stock grants are awarded.
- Ensure employees understand that equity is not a guaranteed part of total comp.
- Use consistent messaging so there are no surprises when grants don’t happen.

Why Clear Communication in Stock Comp Matters

The risk of unclear messaging:
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❌ Employees assume stock grants are automatic and become disengaged if they don’t get one.
❌ Managers struggle to justify equity decisions without clear policies.
❌ HR teams deal with frustration, misalignment, and potential retention issues.

💡 The solution: Use clear, intentional language that reflects your company’s actual stock compensation strategy.

At Aeqium, we help HR teams structure and communicate equity compensation plans so employees, managers, and finance teams stay aligned.

👉 Book a demo today to see how Aeqium can simplify your stock compensation process.

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