More than three-quarters (80%) of respondents have never heard of the government’s employee shareholder scheme, according to research by law firm, Irwin Mitchell.
The research, which surveyed 500 UK employers, found that, out of the 20% of respondents that said they were aware of the scheme, only 1% said they were considering introducing one.
The scheme, which is also know as shares for rights, was passed in Parliament in September 2013. It allows employers to award shares in their organisation worth between £2,000 and £50,000 to their staff. In return, employees give up certain rights, including unfair dismissal, redundancy, training rights, and also the right to ask for flexible working.
Among the 20% of respondents that had heard of the scheme, 40% knew which rights were included, while 45% knew it was the responsibility of the employer to pay the reasonable legal costs of the employee in taking advice on whether to accept the terms.
The research also found:
- 72% of respondents thought the scheme would make it more difficult to recruit staff.
- 55% of respondents said the scheme would have a negative impact on employee retention.
- 23% of respondents thought this type of conduct would be a hindrance to good employee relations.
Tom Flanagan (pictured), partner and head of employment at Irwin Mitchell, said: “The government will be disappointed with the results here, but we have always said that these contracts are both unnecessary and potentially damaging.
“It’s certainly not surprising that they are almost universally unpopular. I have always wondered whether this proposal is really about encouraging productivity and rewarding effort or, instead, part of a drive to make the removal of employment rights more palatable. There is a fear that this is not about helping employers, but something that is ideologically driven.
“The idea of boosting employee participation and commitment in line with the success of a business is a good idea, but there are numerous reasons why this particular method doesn’t tick the right boxes for employees and employers.”