In September 2013 a new form of employee is due to come into effect. In consideration of an employee becoming an “employee shareholder” (instead of just an “employee”), a company employer will issue or allot a minimum of £2,000 worth of shares to the individual, with any gains made on the first £50,000 of shares being exempt from capital gains tax.
As an employee shareholder the employee will forfeit a number of rights including: The right to make a flexible working request except after return from parental leave, no right to claim for unfair dismissal. (except in health and safety cases, automatically unfair cases, or where the dismissal is discriminatory). In addition they will have no right to a statutory redundancy payment.
The new type of employee has been controversial and safeguards have been put in place requiring potential employee shareholders to receive independent legal advice (paid for by the employer) and have a cooling off period of 7 days before becoming an employee shareholder.
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