Employee shareholder agreements must include a statement detailing the loss of employment rights
3rd July, 2013
On 1 September 2013, employee shareholder status is due to be implemented as a new employment status through the introduction of the Growth and Infrastructure Bill 2013. The Act will insert a new section 205A into the Employment Rights Act 1996.
For those looking to enter into or offer an employee shareholder agreement the following considerations must be borne in mind:
• An offer of employee shareholder status must include a statement explaining the rights attaching to the shares and the employment rights which would be sacrificed;
• The individual must receive advice about the offer from an independent solicitor, barrister, legal executive, union official or advice centre. The employer must meet reasonable costs incurred in receiving this advice, regardless of whether the offer is accepted; and
• Individuals agreeing to the offer of employee shareholder status will be entitled to a seven-day “cooling off” period from the day legal advice is received.
For further information or advice in relation to managing the new employee shareholder status, please contact Helen Watson on 01244 405565 or send an email to [email protected]
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