Final Chance to Have Your Say on ‘Employee Owner’ Status Contracts

Posted on November 1, 2012 by


As many of you will be aware, back at the start of October this year the Chancellor announced details of upcoming changes to the Employment Rights Act, relating to the introduction of a new employment status from April 2013.

The new ‘employee owner’ status has been created, the government say, to offer employers greater flexibility to suit their businesses.

Under the new changes, businesses will be able to offer individuals this new type of contract, allowing the new member to receive shares of between £2,000 and £50,000, be exempt from capital gains tax, but in return give up various employment protection rights. The changes could potentially help to negate employers’ fears of a being taken to an employment tribunal, which may have previously deterred them from hiring.

The Department for Business and Innovation & Skills (BIS) say: “Employee owners will have the same rights as current employees excluding unfair dismissal (except where this is automatically unfair or relates to anti-discrimination law), certain rights to request flexible working and training, and statutory redundancy pay. Individuals will also need to give longer notice to return from maternity leave or adoption leave.” 

Ahead of the changes taking place next year, the BIS are consulting on the practical terms of the implementation of the status. The consultation, which seeks views from employers, individuals and the wider labor market to ensure there are no unintended consequences, will close on 8th November after just 3 weeks. 

To assist in ensuring the views of the HR Community are represented, web-based information service HR Bullets, together with TE Law are preparing a response to the consultation and as such would like to hear your views.  Is this something that could work? What potential issues could you see arising?

The full article, with more information and links to the full consultation document can be found on the HR Bullets website.

Responses to HR Bullets should be emailed to by 5th November.