Thu, 23 May 2013
By Jack Feeny
The Growth and Infrastructure Act 2013 was passed by the House of Lords in April 2013, section 31 of which provides for a new status of employee-employer relationship, namely “employee shareholders”. The idea of the scheme is to allow an employer to “purchase” from the employee certain statutory rights, including the right to claim unfair dismissal, in return for shares in the company, from a minimum value of £2,000 up to £50,000. The Act includes provision for the employer to buy back the shares upon the employee leaving the company.
The primary statutory rights that are purchased from employee shareholders are:
- the right to request leave to undertake study or training or for flexible working;
- the right not to be unfairly dismissed;
- the right to a redundancy payment.
The agreement is only legally binding if the employee has received independent legal advice, paid for by the employer, and is given a seven day “cooling off” period during which he can change his mind. The employee also has the right not to be subjected to a detriment for refusing to become an employee shareholder
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