Introducing the New Fixed Price ‘Employee Share Scheme’ Product: SME Corporate Clients

Keypoint Law is excited to announce that we are releasing a terrific new fixed price ‘employee share scheme’ product, which has been built from the ground up for our small and medium enterprise (SME) corporate clients.

An employee share scheme (ESS) is a well recognised way for SMEs to offer their employees a stake in the company, usually by providing them with shares or options at a discounted price. Keypoint’s expert lawyers can advise on all the legal aspects of the scheme and prepare the scheme documentation, for a fixed price and with excellent value for money.

What are the benefits of an ESS?

Some of the main benefits for SMEs of an ESS are:

• Tax benefits and concessions: The Australian Tax Office (ATO) offers some tax concessions for ESS interests, such as deferring the tax point or reducing the taxable value of the discount.
• Incentivise staff without impacting cash flow: For many SMEs, there is only limited room in the budget to allocate bonus payments or other staff incentives. By offering staff a share in the company’s future growth and success, SMEs can align the interests of their employees with the business’ goals and at the same time reward them for their performance.
• Attract and retain talent: ESS can help SMEs compete with larger companies in attracting and retaining skilled and talented employees.

Legal Background

This new service is particularly timely, given some recent law reform in this space.  The Treasury Laws Amendment (Cost of Living Support and Other Measures) Act 2022 has significantly simplified the regulatory regime and make it easier for small businesses to offer an ESS.

The new laws provide disclosure and licensing relief for offers made under an ESS, including under associated trust arrangements, contribution plans, and loans.  These new laws replace earlier and now obsolete relief under ASIC class orders.

The new laws are particularly useful for SMEs that wish to offer ESS interests for no monetary consideration, with minimal disclosure requirements when making such offers .

For ESS interests that require monetary consideration, however, there are a number of changes which companies must be aware of prior to making an ESS offer (in particular, unlisted companies).

As a result of the changes, it strongly advisable for all companies to undertake a review of their existing ESS plans and associated offer documentation to ensure they can rely on the various disclosure and licensing relief available.

Benefits of the Keypoint ESS service

Some of the benefits of the Keypoint SME ESS service include:

• There are no hidden costs: Unlike traditional law firms, we provide these services on a fixed-fee basis. This means you will always know the total cost of your legal bill from the start.
• We offer tailored packages: Our packages cover services for all kinds of businesses. If you need something unique, we can also design a custom quote tailored to your needs.
• We have expert lawyers: who will talk you through your project via phone, video call or whatever suits you best.
• We provide quality advice: and our lawyers take pride in their work and care about your business.
• We provide fast turnaround: You will receive your completed project, usually within 5 – 10 working days.
• For these reasons we are trusted by many: we have helped thousands of small and medium businesses in Australia and we receive excellent feedback from our customers.

How to to learn more about an ESS

You can find more information about ESS’s and our new service here.  This link contains a free-to-download guide that outlines some of the main considerations for SMEs when thinking about an ESS, together with information about the Keypoint service.

If you think an ESS may be suitable for your company, then we invite you to download the guide and contact our team listed in the guide to request an obligation free quote.

Alternatively, you can make a direct enquiry via our Contact Us page.