UK to End "Shares for Rights" Plan

On November 23, the United Kingdom's chancellor, Philip Hammond, announced that the government would end the tax benefits associated with "employee shareholder status" (ESS) and would abolish the status itself at the next legislative opportunity. The ESS offered employees tax-free grants of employer shares that met certain conditions in exchange for the employee agreeing to give up specific shareholder rights. Although when the status was introduced in 2013 it was intended to encourage broad-based employee ownership, in practice it had primarily been used by highly compensated employees. The many other mechanisms to support employee ownership in the UK will remain in place.