Tuesday, 16 October 2012

Osbourne's Employee Share Ownership Scheme

As a signatory to this open letter to Vince Cable, I am republishing the letter as published on Lib Dem Voice this morning.

We, the undersigned, are extremely concerned by the employee share ownership policy. We call for this bill to be amended to remove the part where workers have to give up their rights for share-ownership and, rather, for the proposal to mirror that agreed by the Liberal Democrat conference in this document.

The proposal appears to allow for workers to give up their rights in return for company shares, as detailed on the HM Treasury website:
Under the new type of contract, employees will be given between £2,000 and £50,000 of shares that are exempt from capital gains tax. In exchange, they will give up their UK rights on unfair dismissal, redundancy, and the right to request flexible working and time off for training, and will be required provide 16 weeks’ notice of a firm date of return from maternity leave, instead of the usual eight.
From this we understand that as few as £2,000-worth of shares will potentially give employers the ability to fire workers at will, where the worker has absolutely no rights and has to sell the shares back to the company when they leave, and where the company can determine the value of those shares.

The model is recommended for start-ups and small companies. Their shares are unlikely to be traded and, so, have no clear value. How is an employee to judge the fairness of the offer, let alone be able to dispose of them with confidence in the value? It seems that the workers would give up significant rights, whereas the employer has nothing to lose – they get rid of an employee they don’t want without any comeback or legal challenge, and also get their shares back at a price they can determine. 

We have been told that employee owner status will be optional. However, it seems that this could be made compulsory for future employees in current and new businesses.
The HM Treasury website continues:
Employee-owner status will be optional for existing employees, but both established companies and new start-ups can choose to offer only this new type of contract for new hires.
The power of an employer, with a job market such as we have today, should not be dismissed lightly. Potential employees do not have the luxury of a wide choice of potential vacancies.

The Liberal Democrat Party Constitution states:
Liberal Democrats are committed to fostering a strong and sustainable economy which encourages the necessary wealth creating processes, develops and uses the skills of the people and works to the benefit of all, with a just distribution of the rewards of success. We want to see democracy, participation and the co-operative principle in industry and commerce…
We believe this policy goes against not only Liberal Democrat principles, but principles of decency and honesty in the workplace. 

With a loss of rights, the employee will be in a more unstable employment situation, which can only decrease confidence and spending, which our economy desperately needs if it is to grow successfully.

This bill appears to be the Conservative party’s way of getting “fire at will” through the back door. After the work to stop this going through via the Beecroft recommendations, isn’t it hypocritical to allow the potential for it in this bill?

There is no doubt that some unscrupulous companies will abuse this and employees will lose hard won rights. What employee would want, voluntarily, to give up these rights, for any amount of money? Please either pull or amend this proposal.

Paul Wild, Walsall, Membership and Communications Officer.
Tracy Connell, Newcastle City Party, Regional Officer and local part Exec.
Kevin White, Liverpool Wavertree. Footsoldier and former Constituency Chair.
Gareth Jones, Maidenhead
Penny Burgess, Cotswold
John Richardson, Newark
Councillor Alasdair Christie, Inverness
Malcolm D Gardner, St Austell & Newquay (formerly Twickenham!)
Natasha Chapman, Lincoln, Chair of Lincoln Liberal Youth
Cllr. Michelle Pearce, Calne, Wiltshire
Gareth Loveridge, West Bromwich and Warley
Joshua Dixon, Hillingdon and London Liberal Youth Vice Chair.
Adam Gillett, Tower Hamlets. Former Chair of London Liberal Youth.
John L Oakes, Former Haringey Councillor, Founder, LibDem Friends of Poland; activist.
Alan Webb , Amber Valley , activist.
Gemma Roulston, Reigate member and also membership secretary of LDDA
Ian Wallace South East Cambs
Fiona White, Guildford Constituency, Deputy Leader Surrey County Council Lib Dem Group.
Richard Hudson, executive member of Derby City
Matt Downey, Cambridge
James King, Southport.
David Parkes, Local Party: Brussels / Treasurer Lib Dems in Spain.
Peter Reisdorf, Wirral West.
Linda Jack, Chair Liberal Left, FPC, PCC Candidate Bedfordshire
James Testro, Derby City.Rory Roberson, Worcester
William Jones, chair of Wythenshawe and Sale East
Andrew Page, Inverclyde
Gareth Epps, Reading
Stephen Glenn, Membership Development Officer Northern Ireland
Kat Dadswell, Liverpool Wavertree
Dimitri Seirlis, Worthing West
Michael Mullaney Cllr and Executive Member for Housing Hinckley and Bosworth Borough Council
Alexis Saliou Diouf Alexis S Diouf, Cllr Chesterfield Borough Council
Ian Morton, High Wycombe, Regional Secretary
Cllr Martin Hunt, Deputy Leader, Colchester Borough Council
Dave Harris, Sutton, Surrey
James Moore, Greater Reading
George Potter, Guildford, LDDA Executive
Alex Wasyliw, South Cambridgeshire
Elaine Bagshaw, Chair of Tower Hamlets and Federal Executive member
Nigel Quinton, Chair, Welwyn Hatfield Libdems
Julian Tisi, Windsor
Maria Pretzler, Swansea and Gower
Chris Roberts, London Borough of Havering
Chris Randall Hull and Hessle
Andrew Waller, York Central
Simon Wilson, Broadland
Robert Pitt, Leeds Liberal Youth Secretary
Hannah Bettsworth, Aberdeen Donside, Liberal Youth Scotland Ordinary Executive Member
Aubrey Williams, Thirsk and Malton/Aberystwyth University
Penny Goodman, Leeds North West
Olly Loosemore, Chair of Orpington Liberal Democrats
Louise Shaw, Stockport
James Hackett, Chair of Rhondda Cynon Taff Welsh Liberal Democrats
Leon Duveen, Treasurer Bassetlaw & Sherwood
Marie Jenkins Town Councillor in Devon, Leadership Programme candidate
Jennie Coggles, Exec. Member Nottingham City
Phil Ling, Merton Borough, Exec member, on Leadership Programme
Chris Lucas, Councillor, Three Rivers District Council, Leadership Programme Candidate, South West Herts
Jason J Hunter, Sutton
Angharad Bethan Jones Membership Officer Rhondda Cynon Taff Welsh Liberal Democrats
Daisy Cooper, Parliamentary Candidate (Suffolk Coastal 2010), Lewes
Andrew Hart, Theale
Mario Grana, Theale
Sandra Taylor Altrincham and Sale West with Stretford and Urmston Lib Dems Membership Officer
Dr John Cordwell, County Councillor, Wotton-under-Edge, Gloucestershire CC
Alan Marshall, Rotherham & Barnsley
Greg Judge, Coventry, Leadership Candidate Programme
Geoffrey G J Payne, Hackney, events organiserCatherine Wanless, slough
Sarah Durkin, Wolverhampton East, Secretary
Luke Bosman, Preston
Cllr Nigel Ashton, Southport
Rob Parsons, Lewes, foot soldier
Chris Richards, Vice-Chair Camden Lib Dems, Leadership Programme Candidate
Christina Shaw Leeds NW
Suzanne Fletcher, Stockton local party
Tom Snowdon, Amber Valley Lib Dems
Owen Roberts, Swansea and Gower
Max Wilkinson, Cheltenham
Janet King, Chair, Bromsgrove
Martin Horwood, Member of Parliament, Cheltenham
Adam Janiczek Bradford
Stuart Wheatcroft, Carlisle
Scott Collins, South Northamptonshire
Cllr Jon Ball, Ealing local party and FCC member
Cllr Stephen Knight AMLondon Assembly MemberGroup Leader, Richmond upon Thames Council
Mark Blackburn, Westminster Borough
David Grace, Cambridge City
Cllr Lloyd Harris, Regional Secretary – East of England Lib Dems
Cllr Ruth Skelton, Derby City
Nicola Prigg, Ayrshire
Paul Walter, Newbury – Liberal Democrat Voice editorial team
Luke Chapman, Social Liberal Forum – Membership Officer
Cllr Ros Kayes, Dep Leader, Lib Dem Group, West Dorset District Council
Sadie Smith, West Bromwich and Warley
Cllr Hilary Jones, Leader of Derby Liberal Democrats
Cllr Eric Ashburner, Derby City
Cllr Ajit Atwal, Derby City
Clive Lloyd, Cheltenham
Cllr Joe Naitta, Derby City
Cllr Judith Woodman, Leader of Cardiff Liberal Democrats
Cllr Joe Boyle, Cardiff
Ald. Peter Tyzack, Chair Filton & Bradley Stoke LP
Cllr Mike Carr, Derby City
Jonathan McCree, Haringey Lib Dem
C Gordon, Mole Valley
Rae Holmes, Chesterfield
Phil Stevens, Islington – exec member
Caron Lindsay, Treasurer, Scottish Liberal Democrats
Ruth Hopwood, vice chair Wythenshawe and Sale East Liberal Democrats

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