Golden Handcuffs, first introduced in 1976 , are financial allurements and benefits that have the objective to encourage highly compensated employees to remain with a company, which is the opposite of a Golden Parachute. Golden Handcuffs are offered to key employees in order to keep them in the company, instead of moving from company to company. Golden Handcuffs come in different forms: Employee Stock Options, which endows only when the employee has been with the company for different years and Contractual Agreements, that consist of bonuses or other forms of benefits which must be repaid to the company if the employee leaves before the date agreed on.  Golden Handcuffs are frequently used for jobs that require rare and specialised skills or in a "Tight Labor Market", where jobs are more common than workers. In any case, Golden Handcuffs are usually very expensive for the company and therefore they are not appreciated by shareholders and directors. 
Impacts of Golden Handcuffs
When offered, Golden Handcuffs are extremely tempting as they usually are of great value compared to the employee's annual salary. The experience that follows an agreement of this sort may be draining and abhorrent, this is why the contract must be thoroughly analysed and thought about until an intelligent conclusion or compensation, that benefits both the company and the employee, is agreed upon.  Often employees feel the urge to remain within the company they've been working with, even though it may not seem like the smartest choice, objectively, because of tradition, relationships or a simple feeling of belonging. When different opportunities are offered to an employee, generally the choice is made by a mix of objective and subjective views, where he or she must prioritise every aspect of their opportunities in order to result with a beneficial solution.  These sort of agreements might potentially impose penalties if the employee decides to leave the company before the contracted date, such as the repayment of bonuses. Often included in these contracts are Non-Disclosure Agreements (NDA), where the employee is prohibited to communicate sensitive corporate information and Non-Complete Causes, where working for competitors is forbidden for the leaving employee. 
Structure of Golden Handcuffs
Finest talent is very rare, therefore companies often negotiate deals in order to hold on to key employees. Golden Handcuffs is one of several ways to stop your key employees leave, making it essentially financially unprofitable for them to walk away from the company. These Deals are usually done with stock options, phantom stock or deferred payments. Phantom Stock usually gives the best results, as it gives a motive for staying with the company and making it grow, as the stock increases in value alongside the company. To create a contract that benefits both the employee and the company a legal team should be contacted in order to discuss available options, and key employees should be distinguished.  A funding mechanism should be put in place by the company (if privately held), where obligations are present. Tax repercussions should be minimised for the money set aside, usually meaning using insurance as main funding mechanism. If designed perfectly, the corporation can manage to receive all their money back. 
Salary Reduction and Bonus Deferral Arrangements
Retirement Money Withdrawal
At retirement, or in the general future, money can be withdrawn and the executive can support his or her savings using pre-tax capital.
SERP (Supplemental Executive Retirement Plan)
Also known as a "Top Hat" program, a SERP is funded entirely by the employee and consists of a retirement plan that implements benefits apart from those covered in other retirement plans such as IRA (Individual Retirement Account), 401(k) or NQDC plans.
Excess Benefit Plans
Excess Benefit Plans are NQDC plans that grant benefits only to employees whose benefits are limited by section 415 of the IRS. These limitations diminish the volume of benefit that some highly paid employees profit from amounts they might differently be able to gain without these constraints.
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