Employee Incentives Update – October 2012

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The Government’s plans for a more flexible work force were underlined by George Osborne at the beginning of October when he announced a new employee owner contract. Under the new contract employees will be able to get between £2,000 and £50,000 worth of employing company shares in return for giving up certain employment rights, the most fundamental being the right to claim unfair dismissal and the right to receive a redundancy payment. Under this new contract any growth in value of the shares awarded would be free from capital gains tax. The new contract is aimed at fast growing small and medium sized companies (although it can be used by any company) and is due to come into effect from April 2013. The Department for Business Innovation & Skills has issued a consultation document on the new contract. Consultation ends on 8 November 2012…

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