Recruiters see little interest in employee shareholder status
2 September 2013
The new employee shareholder status, under which a worker sacrifices select employment rights to take up shares in the business, which came into law yesterday (1 September), is unlikely to be of much interest or relevance to recruiters.
Mon, 2 Sep 2013The new employee shareholder status, under which a worker sacrifices select employment rights to take up shares in the business, which came into law yesterday (1 September), is unlikely to be of much interest or relevance to recruiters.
Chancellor George Osborne bought the proposals into law despite opposition and delays, having originally proposed the measures on the back of the seemingly recession-proof success of John Lewis Partnership, the retailer frequently hailed as a model for good employee relations and HR policy.
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But two prominent recruitment firms tell recruiter.co.uk that they have not heard clients interested in the new scheme, nor does it seem that it will be a popular option for the recruiters themselves.
Guy Hayward (left), chief executive officer of City recruiter Goodman Masson, a multiple winner of Recruiter Awards for Excellence including ‘Best Large Agency to Work For' this year, says: “I certainly haven’t had any clients talk to me about it.”
And he also tells recruiter.co.uk that employment partners at two prominent UK law firms he works with haven’t either, one saying that “not a single client has enquired or expressed an interest in this”.
Raj Tulsiani (pictured below), co-founder and CEO of interim and executive recruiters Green Park, tells recruiter.co.uk that “no clients have talked about this”.
While this might have something to do with these only being freshly enshrined in law, he also comments: “I don’t think we’re far enough out of recession for people to be that bullish.
“Although confidence is returning, I think people are still very cautious about the conditions that allow them to move employers,” adds Tulsiani, whose firm achieved the double in the past 12 months of being ranked both on Recruiter’s HOT 100 and FAST 50 performance league tables.
Tulsiani says that Green Park “believes as a company in sharing the growth of the organisation with the people who have created that growth, so we believe that if people don't have the opportunity to share that, it does make it harder to attract that talent”.
Hayward agrees, as indeed do many other recruitment companies using similar benefits, but he notes that in terms of the option of taking on employee shareholders, “we don’t need to because of the EMI [enterprise management incentive options] programme”, which gives that same benefit of shares to staff.
“That is far more relevant to employee engagement, I think why people aren’t responding to this scheme is because we can do it anyway… I can’t see a benefit in us wanting to use it.”
Charlotte Sloan, a solicitor at law firm Thomas Eggar, says that “in our view take-up is likely to be low”, partially because of the cost of offering a minimum of £2k worth of shares, implementing the agreement and providing independent legal advice for the employee, which could “outweigh the benefit for employers”.
And importantly, she tells recruiter.co.uk that the new rules “apply in the same way to existing and new employees”, aside from the fact that existing employees cannot be obliged to take up the new status, while there is nothing to stop a job being offered only on employee shareholder terms.
Chancellor George Osborne bought the proposals into law despite opposition and delays, having originally proposed the measures on the back of the seemingly recession-proof success of John Lewis Partnership, the retailer frequently hailed as a model for good employee relations and HR policy.
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But two prominent recruitment firms tell recruiter.co.uk that they have not heard clients interested in the new scheme, nor does it seem that it will be a popular option for the recruiters themselves.
Guy Hayward (left), chief executive officer of City recruiter Goodman Masson, a multiple winner of Recruiter Awards for Excellence including ‘Best Large Agency to Work For' this year, says: “I certainly haven’t had any clients talk to me about it.”
And he also tells recruiter.co.uk that employment partners at two prominent UK law firms he works with haven’t either, one saying that “not a single client has enquired or expressed an interest in this”.
Raj Tulsiani (pictured below), co-founder and CEO of interim and executive recruiters Green Park, tells recruiter.co.uk that “no clients have talked about this”.
While this might have something to do with these only being freshly enshrined in law, he also comments: “I don’t think we’re far enough out of recession for people to be that bullish.
“Although confidence is returning, I think people are still very cautious about the conditions that allow them to move employers,” adds Tulsiani, whose firm achieved the double in the past 12 months of being ranked both on Recruiter’s HOT 100 and FAST 50 performance league tables.
Tulsiani says that Green Park “believes as a company in sharing the growth of the organisation with the people who have created that growth, so we believe that if people don't have the opportunity to share that, it does make it harder to attract that talent”.
Hayward agrees, as indeed do many other recruitment companies using similar benefits, but he notes that in terms of the option of taking on employee shareholders, “we don’t need to because of the EMI [enterprise management incentive options] programme”, which gives that same benefit of shares to staff.
“That is far more relevant to employee engagement, I think why people aren’t responding to this scheme is because we can do it anyway… I can’t see a benefit in us wanting to use it.”
Charlotte Sloan, a solicitor at law firm Thomas Eggar, says that “in our view take-up is likely to be low”, partially because of the cost of offering a minimum of £2k worth of shares, implementing the agreement and providing independent legal advice for the employee, which could “outweigh the benefit for employers”.
And importantly, she tells recruiter.co.uk that the new rules “apply in the same way to existing and new employees”, aside from the fact that existing employees cannot be obliged to take up the new status, while there is nothing to stop a job being offered only on employee shareholder terms.
