EU’s focus on employee shareholding

Paweł Kawarski        30 November 2015        Comment (0)

Employee shareholding has become part also of the European Union’s interest. In particular, on 14 January 2014 the European Parliament adopted a resolution on financial participation of employees in companies’ proceeds.

The resolution identified obstacles in offering employee financial participation (EFP) schemes in the Member States, called the States to provide tax incentives to promote employee ownership, and included a number of recommendations.

The European Parliament

– calls on the Commission and on Member States to consider appropriate measures to encourage companies to develop and offer EFP schemes, open to all employees on a non-discriminatory basis;

– encourages social partners to continue working together to develop new opportunities and innovations for EFP at the relevant levels;

– believes that, in order to promote financial participation for the purpose of creating a new form of company financing and enabling employees to be more connected to the company that employs them, employers should be given the opportunity to offer employees share capital subscriptions or specific debt securities (bonds);

– notes that there is a lack of information and education about possible employee ownership schemes, especially among SMEs;

– encourages Member States, in cooperation with social partners, employee ownership organisations and the Commission, to use existing single information portals, or to develop new ones, in order to explain the benefits and advantages as well as risks of EFP, the national incentives available and the different models which exist.

In response to the resolution, on 26 May 2014 the European Commission issued a statement in the matter in which it “welcomed the resolution of the European Parliament and its support for action to promote employee financial participation and employee share ownership across the EU”.

The Commission informed about a pilot project on “Promotion of employee ownership and participation” being carried out. Its purpose is, first, to identify obstacles to transnational employee share ownership schemes, second, it will identify the most appropriate means of enhancing knowledge of and access to the relevant information about employee share ownership.

The fact that European Union recognises advantages of employee shareholding should be regarded as positive although it remains to be seen what exactly the above works will mean for the idea in question.

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