Pardon us for including ourselves as a case study but we have chosen a different form of ownership compared with most other law firms, and we are so pleased with it that we would like to tell you more. Like the best share ownership structures, it isn’t over-complex.
We have a small number of founder shareholders – all solicitors – but an unshakeable belief that as many members of our team as possible should also be owners. Everyone here willingly takes responsibility as if they were an owner, so we think ownership should be spread widely. We have therefore chosen a different approach to ownership compared with the partnership (or limited liability partnership) model favoured by the majority of law firms, in which the ownership tends to be limited to a select group. We don’t say our model is universally better, but we do think it’s right for us.
As a law firm, we aren’t allowed by the tax rules to have an EMI option plan, so we have instead taken an approach to share ownership that combines awards of CSOP options with the purchase of shares, for the whole team.
Employees are granted CSOP options, at an exercise price agreed with HMRC as current market value, exercisable after three years. At the same time, they are also offered the opportunity to purchase some shares, enabling them to share in profit distributions through dividends even though their options aren’t yet exercisable.
We are fortunate in enjoying low rates of staff turnover so only expect to have to deal with leavers on an occasional basis. Any employee who leaves must offer their shares for sale internally.
If you would like to explore how employee ownership or an employee share scheme might be introduced in your company, please contact us for an initial discussion.
We are happy to meet at our offices without charge or commitment and will be very pleased to hear from you.