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Terrifying misuse of the term "democracy". The trades unions would stitch up the employee director selection the same way they have been stitching up Labour parliamentary candidate selections for years, only now with added Momentum. Most unions' memberships are notoriously apathetic, leaving the futures of ordinary workers in medium sized companies to be decided by left-wing activists working on the instruction of Len McCluskey et al, rather than by the workers themselves.
I just love it when those on the right preach about what is and what isn't democracy, and what is wrong with the Labour party.
Typical Labour. All compulsion no choice. Companies would simply organise in such a way as to fall below the thresholds or leave the UK altogether.
I couldn't agree more: I too prefer the Tory way of legislation where they just suggest that we make certain changes. e.g. RTI and workplace pensions - thank god we all made the right choice to implement these wonderful innovations.
And as for the myth of companies leaving the UK. The banks and bankers all threatened to go if legislation was enacted to curb their excesses. We would all have been better off if they had gone and someone else had to bail them out. The truth is that the countries that could afford to bail them out wouldn't have them - they have enough of their own to bail out anyway - and most bankers (i.e. the backroom boys) are better paid here than anywhere else in the world, so they wouldn't leave.
I'm not saying I agree wholeheartedly with these proposals, but the general concept of more employee input at the top management level would improve most large enterprises. It would be really good if companies could embrace it and try to see the benefits rather than put their energies into avoidance, like you suggest.
I didn't agree with workplace pensions either but this legislation was quite tame compared to what is proposed here. This is nationalisation on a grand scale - no wonder the markets are jittery with these sinister fellows riding so high in the polls.
Theresa May speechified about "worker representatives" a couple of years ago; surely Labour's proposal is simply an extension of this.
https://touchstoneblog.org.uk/2016/10/aboard-making-worker-representatio...
The worst aspect of the Labour proposals is that they appear to cap employee dividends and pocket the rest as a backdoor tax.
Thirty years ago I worked for a company that introduced an Employee Share Ownership Plan. It was part of a management buy-out arrangement. The management retained control with 51% of the shares and employees were allocated shares based on length of service.
I don't know how that worked out because I left soon afterwards but the company was eventually taken over, and no doubt shareholders were paid out in the normal manner.
If you're going to make employees shareholders, fine. Let them have the same rights as other shareholders in the same class of shares.
Politicians have a terrible reputation for meddling with things they don't understand and end up making things worse not better.