Personnel Today
  • Home
    • All PT content
    • Advertise
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Equality, diversity and inclusion
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
    • OHW Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • XpertHR
    • Learn more
    • Products
    • Pricing
    • Free trial
    • Subscribe
    • XpertHR USA
  • Webinars
  • OHW+

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
    • Advertise
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Equality, diversity and inclusion
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
    • OHW Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • XpertHR
    • Learn more
    • Products
    • Pricing
    • Free trial
    • Subscribe
    • XpertHR USA
  • Webinars
  • OHW+

Economics, government & businessEmployment law

Lords reject ‘rights for shares’ proposal

by John Eccleston 21 Mar 2013
by John Eccleston 21 Mar 2013

The House of Lords last night rejected government proposals for the so-called “rights for shares” scheme, under which employees would be able to sacrifice certain employment rights for shares in their organisation.

The proposal was put to the Lords as a clause in the Growth and Infrastructure Bill, but was severely criticised prior to a vote in which the plan was defeated by 232 votes to 178.

Lord Adonis said: “To my mind, when you have a totally mad idea like the one before us, the best thing is not to test it out but to kill it at birth, and I hope that is what we are going to do.”

He added: “To remove this clause today would be an act of mercy to the Government, let alone to the employees adversely affected by it.”

Lord Forsyth described the proposal as “ill thought through, confused and muddled” and “positively dreadful”.

Following the vote, it will now be up to MPs to decide whether or not to reinstate the plans when the Growth and Infrastructure Bill returns to the Commons.

The “rights for shares” or “employee-owner” plan has been the subject of significant criticism from employment law experts since it was first proposed and commentators have welcomed the Lords’ decision to block it.

Darren Newman, employment law trainer and XpertHR contributing editor, said: “The Government should take note of what the Lords have said and drop this proposal, which is highly complicated, poorly thought out and intellectually incoherent. It’s striking that almost nobody is actually enthusiastic about the measure and most of the arguments in favour come from those who think that very few employers will want to take advantage of it.

“We should remember that the proposal was made by George Osborne in a speech to his party conference. Nobody in business had been calling for this sort of scheme and no-one in business will mourn its passing.

“The lesson of the whole debacle is that changes to employment law need to be carefully thought through and consulted on before they find their way into legislation. The department for Business, Innovation and Skills is the proper department to work on these issues. Ministers from other departments should frankly concentrate on their own policy areas and leave employment law alone.”

Max Winthrop, head of employment at SRF Legal and XpertHR employment manual updating author, agreed that the proposals were flawed, and suggested that mechanisms already exist that allow employers and employees to achieve a similar outcome. He said “The problem with the employee-owner status in my view is that such advantages as there may be for both employee and employer would be much more effectively achieved through partnership or limited liability partnership status.

“These are well-established vehicles for running a business of the type that the employee-owner model appears to be aimed at.”

For more information on the Lords vote and further background information on employee ownership, visit XpertHR.

Avatar
John Eccleston

previous post
Jobs boom amid Budget day gloom
next post
Employers face retention challenge, survey finds

You may also like

Employment law changes for 2022 and beyond: update...

1 Jul 2022

Inflation in May 2022 at 40-year high, as...

22 Jun 2022

Setback for civil servants’ union in bid to...

10 Jun 2022

Oxford study highlights best gig economy firms to...

9 Jun 2022

Future of work under Labour: Justin Madders talks...

9 Jun 2022

Tesco appeal against fire and rehire ban to...

8 Jun 2022

Bank holidays: six things employers need to know

5 Jun 2022

Corporate reporting and audit regime will reduce risk...

31 May 2022

Davos 2022: ‘Invest in social jobs to save...

27 May 2022

P&O Ferries boss denies reputational damage after mass...

27 May 2022
  • NSPCC revamps its learning strategy with child wellbeing at its heart PROMOTED | The NSPCC’s mission is to prevent abuse and neglect...Read more
  • Diversity versus inclusion: Why the difference matters PROMOTED | It’s possible for an environment to be diverse, but not inclusive...Read more
  • Five steps for organisations across the globe to become more skills-driven PROMOTED | The shift in the world of work has been felt across the globe...Read more
  • The future of workforce development PROMOTED | Northumbria University and partners share insight...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits
Forum for Expatriate Management
OHW+
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2022

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2022 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
    • Advertise
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Equality, diversity and inclusion
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
    • OHW Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • XpertHR
    • Learn more
    • Products
    • Pricing
    • Free trial
    • Subscribe
    • XpertHR USA
  • Webinars
  • OHW+