The consultation document provides some additional information regarding the proposals, although there are a number of areas which remain unclear (for example how TUPE will apply and the valuation of shares). In particular, the consultation clarifies that:
- employee owners will retain the right not to be automatically unfairly dismissed and so would be able to bring claims such as whistleblowing;
- those returning from both maternity and adoption leave will need to give 16 weeks notice (rather than eight as at present), although no mention is made of additional paternity leave;
- the right to request flexible working will be forfeited, although the EU derived right to request changes to working hours or patterns of work on return from parental leave (but not maternity, paternity or adoption leave) will remain, but must be exercised within four weeks of such return;
- employee owner shares will be subject to income tax and national insurance contributions in the usual way for shares acquired by reason of employment, but be exempt from capital gains tax. The shares will not be eligible for the Enterprise Incentive Scheme or any other current share scheme which offers tax advantages, although these could be run alongside the issuing of employee owner shares; and
- employers will be able to require that the shares issued are surrendered on termination of employment, although employers would need to buy back the shares at a "reasonable value". The Government is consulting on what would be "reasonable value" and how this would be calculated.
The consultation closes on 8 November 2012, giving only a few weeks to register any responses.
- No action is required at this stage, further updates will follow once the details of the changes in the law have been confirmed.