Employee shareholder 'Status': Dismantling the contract of employment

On 1 September 2013, a new Employee Shareholder status came into force in the UK. Under its provisions, employees can be denied access to key employment rights such as unfair dismissal protection and redundancy pay in return for a shareholding in their employer valued at a minimum of £2,000. This article sets out the details of the new status, and evaluates its impact from several angles. The notion of the employee shareholder is difficult to square with the existing frameworks of UK Employment and Company Law; it is also unnecessary and exceedingly complex and thus fails to live up to the Coalition Government's proclaimed goals. Whilst extensive uptake is unlikely in consequence, the Employee Shareholder status nonetheless represents an unprecedented attack on the very core relationship of employment law, the contract of employment: divorced from employment protective norms, it loses its key public-regulatory function, the distribution of risk between workers and their employing entities. As a result, employment rights become subject to market forces in negotiation between workers and their employers. © Industrial Law Society; All rights reserved