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...

Partner Bill Cogan comments in Business Value Exchange

Bill Cogan comments on corporate venturing in Business Value Exchange

READ MORE

Highly Commended at the FT Innovative Lawyer Awards 2017

On 4th October the FT Innovative Lawyer Awards took place at the Natural History Museum, which was a fantastic venue for the event.

READ MORE

Ignition Law website wins Bronze at iNOVA Awards

The Ignition Law website has won a Bronze Award in the Professional Services category at the iNOVA Awards 2016

READ MORE

Ignition Law featured in Flexible Working Report

Flexible and family friendly working: The competitive advantage for organisations in the legal sector - ​Ignition Law featured in Flexible Working Report by Hydrogen and My Family Care

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

Ignition Law recognises growing client base of female founders and business women

Ignition Law hosts networking dinner to recognise and support the firm's growing client base of female founders and business women

READ MORE

all posts