He was talking about Employee Stock Ownership Plans (ESOPs). ESOPs were around previously but received favorable tax treatment under Reagan's tax legislation in 1981 and 1984, and additional incentives were included as part of the big Tax Reform Act of 1986.
ESOPs were popular for a short time and were even used as a way to stop hostile takeovers. Subsequent changes to tax laws in the 1990s and later made them less common, and more companies use stock options now instead for employee participation.
http://www.esopassociation.org/advocate/advocacy-kit/esop-victories