This website uses 'cookies' to enhance your experience and for basic functionality. Using this website means you're happy with this. To find out more about cookies on this website, see our privacy policy.

Caroline Sherrington comments in The Sunday Times

Caroline Sherrington

Handing out shares to staff? Be ready for a dog’s dinner

“Henrietta Morrison has spent two years and about £150,000 trying to set up a share scheme for staff at Lily’s Kitchen, the posh pet-food business she started in 2008. But, so far, granting equity to her 72-strong workforce has proved difficult…

...Some share plans allow staff to hold equity immediately, which can mean workers have voting rights and receive updates on the company’s performance.

One of the more popular schemes, along with EMI, is the Share Incentive Plan (SIP), which lets company bosses grant free shares worth up to £3,600 to each worker a year. A recent ProShare report showed that, on average, bosses using this method tend to hand out much less: just £714 to each employee annually.

Under SIP, workers are immediate shareholders and pay no income tax or national insurance on shares that are held for at least five years…

...But there are other ways to incentivise employees. “People jump to the conclusion that they must give share options,” said Caroline Sherrington, senior counsel at Ignition Law, which has advised start-up bosses. As a founder, “there are other ways to hold on to as much [equity] as possible. You can give staff bonuses or commission,” said Sherrington.”

This article was originally published in The Sunday Times and can be read here.

You may also like...

David Farquharson gives a talk on new ventures at UCL

David Farquharson discusses Intellectual Property and Legal Structures at UCL New Venture Creation Group

READ MORE

Ignition Law partners with the Tennis Foundation for the NEC Wheelchair Tennis Masters

We are delighted to announce our partnership with The Tennis Foundation for the NEC Wheelchair Tennis Masters

READ MORE

David Farquharson discusses on-the-job training in The Times Law Brief, HRM Guide & SmallBusiness

David Farquharson published in The Times Law Brief, HRM Guide and SmallBusiness discussing the lack of on-the-job training for junior lawyers

READ MORE

Caroline Sherrington & Helen Burt discuss trade marking and protecting brands in Tech City News

Caroline Sherrington & Helen Burt discuss trade marking and retaining ownership over the use of name and brand in Tech City News

READ MORE

Partner Alex McPherson writes on Uberisation and agile working in the legal profession

Alex McPherson writes on Uberisation and agile working in the legal profession in HRM Guide, Growth Business, IT Pro Portal and Legal IT Insider

READ MORE

Ignition Law announces partnership with leading equity crowdfunding platform Seedrs

Ignition Law is delighted to announce its partnership with leading equity crowdfunding platform Seedrs

READ MORE

all posts