What service counts toward vesting?

Unlike in some benefit plans, service for time-vested option and restricted stock grants is rarely measured from the date of hiring. Rather, these vesting schedules start at the grant date. Companies do this so that stock grants retain employees and continually motivate them to perform well.

Example: You are granted options at hiring. Two years later, you are granted restricted stock. The vesting schedules run independently from the date of each grant.

A growing number of companies now link vesting to something other than just length of employment, particularly for restricted stock grants to executives. With this emphasis on pay for performance, some companies tie vesting or grants to reaching specified goals in metrics.