The new employee-shareholder laws come into effect this Sunday. From that point employers will be able to offer their workers a minimum of £2000 worth of shares in return for relinquishing some employment protection rights, including unfair dismissal and redundancy. There will be no tax or national insurance due on the first £2000 worth of shares allotted to the worker and a capital gains tax exemption of up to £50,000 is available on their disposal. A number of safeguards for workers have now been built into the legislation, including a requirement that they must receive independent legal advice before signing up to the new status.

These arrangements will involve a number of legal complexities. Partly for that reason it is unclear how attractive they will be to employers. There will certainly be a lot of paperwork, and this may be particularly daunting if the employer does not already have experience of operating employee share schemes. In addition employees offered this status will still retain many employment rights, notably the full range of discrimination protection, as well as whistleblowing and other similar rights.

The employee-shareholder provisions are the latest in a rush of new legislation that has been introduced in the last few months.