Roderick Ramage queries whether the employee shareholder scheme can become widespread
George Osborne’s harebrained proposal for employee shareholders, which was announced at the Conservative Party Conference last October, made it to the statute book and came into force yesterday (1 September 2013).
The scheme for employees to be given shares in their employer in exchange for relinquishing certain statutory employment protection rights became law by s 31 of the Growth and Infrastructure Act 2013, which inserted ss 47G, 104G and 205A into the Employment Rights Act 1996 (ERA 1996), of which s 205A is the principal section. The conditions for an individual to become an employee shareholder are that:
-
he and his employer make an agreement for him to be one;
-
the employer issues or procures its parent company to issue fully paid shares with a value on the day of issue of not less than £2,000, for which the individual gives no consideration;
-
the employer or prospective employer gives to him a written statement of the status of an employee shareholder and the terms of
