The government has announced plans to introduce a new form of employment contract to be known as an “owner-employee” contract. Under such a contract, employees will receive shares in the employing company of between £2,000 and £50,000 in value. The shares would be exempt from capital gains tax. In exchange for this, employees would be expected to waive some of their employment rights including the right to claim unfair dismissal, the right to a redundancy payment and the right to request flexible working and time off to train.

These contracts will be available for companies of any size albeit that the expectation is that they would be more suited to small and medium sized companies especially recent start-ups. Currently it is intended that these contracts will be available for use from April 2013 with consultation on the details to begin later this month.