Having given interested parties just three weeks to respond to a so-called consultation on employees swapping rights for shares in their employer’s firms (which closes this week), the government has published proposals to increase the number of employee owned firms anyway.
In order to boost the number of businesses that become or convert to the employee ownership model, the government has announced plans which include:
- assessing the viability of setting up an independent Institute for Employee Ownership to raise awareness of employee ownership and provide a single point of contact for information and advice to help companies set up employee owned businesses
- working with mainstream organisations including the Institute of Chartered Accountants in England and Wales and the Law Society to develop simple ‘off the shelf’ templates for setting up an employee owned company and making these readily available through professional advisors, including HMRC
- providing a guide for staff and employers to request and agree an employee ownership takeover
- working with the John Lewis Partnership to examine the barriers to funding for private sector employee-owned companies.
The plans follow a review of the sector entitled “Sharing Success: The Nuttall Review of Employee Ownership”.
Thompsons has warned that unscrupulous employers could abuse an employee owner’s “rights for shares” scheme by dismissing an entire workforce and imposing it as new terms and conditions on re-engagement.
Thompsons response to the government’s consultation is available here: Implementing Employee Owner Status
To read Thompsons initial response to the government's plans, go to: Owner-employees: workers united, or trading a cow for a handful of half-baked beans?