OF EMPLOYEE SHARE OWNERSHIP POLICIES IN EUROPEAN
recent policy developments in Europe pave
the way towards higher incentives for employee
share ownership, leading our barometer
to a new high.
addition to the two existing employee share
schemes in Austria, a third
scheme was introduced on 1.1.2018 providing
exemption of tax and social contribution up
to 4.500€ annually. In France,
the employers' social contribution on restricted
share units was reduced again from 30 to 20%
in 2018. The Key Employee Engagement Programme
was introduced in Ireland -
a share options incentive scheme for SMEs
aimed to support SMEs to attract employees
in a competitive international labour market,
providing a favorable tax treatment for stock
options. The Netherlands apply
a favorable tax treatment of stock options
for employees of innovative start-up companies
since 1.1.2018. Sweden provides
tax exemption for shares received as Christmas,
anniversary or special memorial gift, and
easing of taxation of stock options in start
up companies. Denmark applies
higher exemption of salary taxation for broad-based
employee share plans since 1.1.2018. Finally,
France took the decision to
double its employee share ownership by 2030
and the new "PACTE" Law will organize the
first steps in this direction in 2019.
all barometers, this one announces the future.
The positive trend of our barometer since
2013 announced the resumption of growth in
the number of employee shareholders in Europe,
which is a reality since 2016. Good
news for all Europeans !
increasing strongly and continuously since 1980,
the number of employee shareholders in Europe was slightly
declining from 2010 to 2014, before rebounding recently
(See forthcoming Annual Economic Survey of Employee
Share Ownership in European Countries in 2017).
decline from 2010 to 2014 was partly due to the
impact of the European financial crisis that erupted
in 2008. However,
the impact of the policy decisions taken in European
countries was probably the most important factor.
is known that the large-scale development of employee
share ownership depends mainly on incentive policies
incentives are indispensable prerequisites for the
development of employee share ownership, EFES,
large-scale development of employee share ownership
brings better motivation, productivity, profitability,
higher growth, more and better jobs. This is good
for all. But it depends on policy will to initiate
the virtuous circle through appropriate fiscal incentives.
A recent study showed that the balance of fiscal
costs and benefits of the ESOP policy for the US
federal budget in 2015 was 2 billion $ compared
to 17, a gain of 15 billion $ (See The
Impact of Employee Ownership and ESOPs on Layoffs
and the Costs of Unemployment to the Federal Government,
2008, some European countries took negative decisions,
removing or decreasing fiscal incentives, which
led to a decline of the number of employee shareholders.
Some other European countries took the opposite
way, applying new or higher incentives, which led
to a higher number of employee shareholders.
2009-2012, France and Ireland reduced their fiscal
incentives, as well as Denmark, Greece and The Netherlands,
where all incentives were removed. In contrast,
significant policy progress occurred in the UK in
2014-2016, as well as in Spain, in Hungary, in Austria
(which doubled its fiscal support on 1.1.2016),
and in Romania and Iceland.
addition Denmark restored in July 2016 the incentives
that were removed in 2011. This is typical of the
recent changes in European policies: One of the
first deeds of the new Danish Government in 2011
(Ms Thorning-Schmidt, socialist) was to remove all
incentives. One of the first deeds of the new Danish
Government in 2016 (Lars Rasmussen, conservative-liberal)
was to restore them.
recently, Norway doubled its fiscal support on 1.1.2017.
Vice-Prime Minister Morawiecki announced a long-term
plan in five points for the development of Poland,
including employee share ownership, and a new Polish
"Forum for Employee Ownership and Domestic
Capital Development" was set up in April 2016.
these policy decisions in various European countries,
in a positive or a negative way, can be summarized
through a single dedicated tool. This is the reason
of the setting up of the EFES "Barometer
of employee share ownership policies in European