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Jenny, Solicitor
Category: Law
Satisfied Customers: 6467
Experience:  Qualified Solicitor specialising in Employment Law and general legal matters. Please start your question For Jenny Only
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My employer gave me a small shareholding as part of my

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My employer gave me a small shareholding as part of my employment agreement. They never put this in writing to me but lodged the shares with Companies House. They placed a caveat of meeting a level of profit by March 2014. I wasn't fully aware of the target details as it wasn't stared anywhere to me. Since 2011 I worked hundreds of hours overtime for no additional remuneration because i was repeatedly told my shareholding would pay off in the end. I had concerns about the caveat that was lodged against my shares as i had never been informed of what purified the company has made but I was promised that despite the caveat "something would be sorted out". At the end of February 2016 I received a letter telling me the company hadn't met the targets required by the caveat and therefore the shares are null and void. I requested proof and further discussion and I've received no proof only discussion to tell me I have no claim. I wish to sue the company for false promises and gaining additional free labour from me as a result. Is this feasible?
Customer: replied 1 year ago.
34;stared anywhere tome" should be "stated anywhere to me"."What purified the company" should be "what profit the company".My apologies.

Hello my name is ***** ***** I am happy to help you today. Are you still an employee of the company?

Customer: replied 1 year ago.
Hello Jenny. Yes I am still employed there.

Have you raised a formal grievance about this?

Customer: replied 1 year ago.
I have written formal letters to the board of directors starting my grievances.
Customer: replied 1 year ago.

and just to clarify there is nothing in writing or any verbal agreement setting out the required profit levels?

Customer: replied 1 year ago.
When I was employed it was stated that I was to be gifted shares in the company as an incentive since it was a brand new business and therefore not a lot of money in the business at the time. So I took a sub standard salary. It was said at the time that the shares could be worth £100000 on the sale of the business. I recall mention of the company "making a million pounds" as a target for the shares but this was never formally advised to me despite my asking for written confirmation on many occasions. It has since transpired that the caveat lodged at companies house was £1M profit needed to be attained by a set date. Had that been clarified at the beginning I may have viewed the shares differently as it was a highly unlikely target given it was a brand new small business.

The difficulty with the claim you are proposing is that a breach of contract claim would have to show a breach of agreement. In the absence of an agreement as to profit levels it is difficult for you to prove. A court would want to know why you had not sought clarification of the profit level in writing at the time. If the company has lodged this figure at Companies house then this will act against you. I therefore think you may struggle with a breach of contract claim if I am honest.

You do, of course, have the right to raise a formal grievance that the employer has seriously misled you and it amounts to a breach of trust and confidence and you may have a claim under the National Minimum Wage act in the event that you were paid the minimum wage in respect of the hours you worked.

If you have any further questions please do ask. If I have answered your question I would be grateful if you would be so kind as to rate my answer, thank you and all the best.

Customer: replied 1 year ago.
OK thank you. Do you think the following information would have any bearing; a colleague was offered a job elsewhere and have his notice in February of 2014. The company matched the salary offer and restated that he has shares in the contact and that they would be valuable on the date of the business. It should have been known at that point whether the company would hit the target by the end of March 2014. It was based on this we felt confident the company was intending on resolving the caveat that was lodged.
Customer: replied 1 year ago.
Apologies for the wording. Predictive typing on my phone is changing many words. I hope it makes sense.

It is helpful if you can use it in evidence that the shares had value at that date. It is still unclear though as 'having value' and the actual value are two different things. May I ask why you did not ask for clarification of the value and the profit level?

Customer: replied 1 year ago.
We did many times. It was always stated it was being dealt with. But nothing ever transpired.

My original advice remains. The difficulty you have is putting value on a breach of contract claim but there is nothing to prevent you trying to make a claim if you wish. The court will have to find a breach of contract to find in your favour. In the absence of an agreed amount that will be very difficult to do.

My advise is therefore to pursue it on the basis of a breach of trust and confidence and in the future ensure that you have terms set out in writing.

Customer: replied 1 year ago.
Is the beach of trust and being misled anything that can result in some form of compensation in court? Or is it just something that is lodged with the company? What is the purpose of it please? Minium wage issues do not apply here.

It is a breach of contract. Every employment contract has an implied term of trust and confidence. Technically you could bring a claim to the tribunal on the basis that the employer has breached your contract but, a with a county court claim, your difficulty is that you cannot put a value on the loss as nothing was actually agreed. If relations have broken down it can be enough, that if it is not resolved you would have the right to resign and claim constructive dismissal, for which you can be compensated for economic loss for future earnings.

There is no easy claim here. It would be wrong for me to suggest there is.

Customer: replied 1 year ago.
OK. Your advice has been very helpful. Thank you very much.

No problem, all the best with it. I am sorry it could not be more positive. Please do take the time to rate my answer before leaving the site as I am not otherwise paid for answering your question. Thank you and all the best.

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