A large publicly traded company encourages its production-line employees to invest their tax-deferred retirement money in the company's own stock. The company believes that this creates an allegiance among company employees and gives them an incentive to diligently strive to improve the company's performance.
The company recently hired you to advise employees in individual counseling sessions about how they should invest retirement funds in company deferred compensation plans and Individual Retirement Accounts.
a. Do you need to make any disclosures to the employees?
b. Is it wise for employees to invest retirement savings in their company's stock?