STOCK-BASED COMPENSATION

6 Months Ended

Jun. 30, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

The Company has a stock-based compensation plan for non-employee directors. Employers Mutual also has several stock plans which utilize the common stock of the Company.  Employers Mutual can provide the common stock required under its plans by: 1) using shares of common stock that it currently owns; 2) purchasing common stock in the open market; or 3) directly purchasing common stock from the Company at the current fair value. Employers Mutual's current practice is to purchase common stock from the Company for use in all of its stock plans (including its non-employee director stock purchase plan and its employee stock purchase plan). A portion of the compensation expense recognized by Employers Mutual (as the requisite service period for restricted stock awards/units is rendered) is allocated to the Company’s property and casualty insurance subsidiaries though their participation in the pooling agreement.

An account Employers Mutual established to hold previously granted restricted stock awards until they vest will periodically contain excess shares of the Company's stock stemming from forfeitures and surrenders. During the first six months of 2018, the Company repurchased 30,523 shares of stock from this unvested restricted stock account at an average cost of $26.30.

During the first six months of 2018, 120,439 restricted stock units were granted to eligible employees of Employers Mutual and 2,800 shares of restricted stock awards were granted to non-employee directors of the Company. Under the stock plans, 92,214 shares of restricted stock vested, and 57,424 options were exercised at a weighted average exercise price of $14.83. The Company recognized compensation expense from these plans of $193,000 ($153,000 net of tax) and $535,000 ($348,000 net of tax) for the three months and $606,000 ($479,000 net of tax) and $212,000 ($138,000 net of tax) for the six months ended June 30, 2018 and 2017, respectively.