Share Schemes

It is becoming increasingly common for companies to involve employees in their ownership structure. At Gaby Hardwicke, we appreciate that this can be for a variety of different reasons including:-

• Strategic reasons, such as succession planning; 
• Incentivising or rewarding employees in a different way to standard salary and bonus procedures i.e. by giving employees a share in any growth in the company’s value or annual profits (or both); 
• Tax efficiency. This could be on the part of the selling shareholders or the company in respect of tax-advantaged arrangements for employees; and/or 
• Promoting employee retention and fostering a culture of employee loyalty.

Employee Share Schemes 

There are many ways in which individual employee ownership based schemes can be implemented. This is a complex area and it is important that specialist professional advice is sought. Our team of expert solicitors routinely advise clients on a variety of different types of employee share schemes or incentives, including growth share arrangements, Enterprise Management Incentive Schemes (EMIS) and Share Incentive Plans (SIPS).  Please see our Briefing Note on Employee Ownership for further information on these particular schemes. 

There is a growing trend towards companies forming employee ownership trusts (EOTs) and employment benefit trusts due to the generous tax reliefs on offer for selling shareholders. The process involves the formation of a trust that acquires the controlling interest in the company, which is held on behalf of the employees of the company as a whole. Please see our article on Employee Ownership Trusts for further information. We have also prepared a Guide on Employee Ownership Trusts, which sets out some useful details on EOTs, including how an EOT works, the tax reliefs that may be available as well as setting out some details as to some practical advantages of adoption an EOT share scheme model. Please contact us if you would like a copy. 

How can we help? 

Our specialist solicitors have acted for a wide range of clients over the last few years, assisting and advising on the implementation of employee share schemes. This has included companies within IT, manufacturing and events sectors in deals with a value up to £50 million. 

We are happy to discuss employee share scheme services that may be required without obligation. Please call us on 01323 435900.