SIP & SAYE Survey 2012 - ifs Proshare

FINANCIAL PARTICIPATION

SIP & SAYE Survey 2012 – ifs Proshare

Free shares worth over £200 million were given to UK workers last year, according to ifs ProShare. The annual Employee Share Survey, drawing on information from 451 companies, including 95 of the FTSE 100, found a total of 378,497 workers received on average £536.37 each in free shares during 2011.

This average was down from £675.98 per employee given to 353,235 employees in the previous year. The tax-free shares were given to employees as part of Share Incentive Plans (SIPs), up to an annual maximum of £3,000 per employee.

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Key survey findings

• More than two million employees participated in an employee sharesave scheme in 2011, representing 37% of staff eligible to participate.
• The average monthly amount of money employees contributed to a Save As You Earn (SAYE) sharesave grew slightly, to £102 from £101 in 2010.
• An increasing number of staff are saving the maximum monthly amount of £250, up 7% to 22% in 2011. Employees can save between £5 and £250 per month from their net salary in a SAYE sharesave scheme for example, making it an affordable way of investing in shares and the company they work for.

Employers such as BT, Aviva, National Grid and ASDA all offer a range of SAYE (Save As You Earn) and SIP (Share Incentive Plans) share schemes. Over 17,000 ASDA employees recently received on average £2,900 each from an SAYE sharesave scheme.

A final word

"As our survey has shown, giving employees free shares remains a popular, tax-efficient way of rewarding employees at all levels. These are often given in recognition of good performance, either of the individual or the company, or as a way of retaining staff due to the tax implications of selling free shares within three to five years of receiving them.

“What many people still don’t realise however is that these employee share schemes are widely available to the majority of private sector UK workers. We calculate that around 2 million UK workers are currently participating in an all employee share scheme. If you work at a publicly listed company, it’s very likely a range of share scheme options are available to you. An SAYE scheme for example, is one of the most popular and represents a low risk way of buying shares in the company you work for. At the end of the scheme, if the share price has fallen, employees do not have to buy the shares at the price offered at the start of the plan, they can choose to receive a full refund of their payments instead." - John Collison, Head of ifs ProShare.

Want to know more?

Title: SIP & SAYE Survey, ifs ProShare, July 2012.

Availability: If you would like to purchase a copy of the SIP & SAYE Survey, email: ifsproshare@ifslearning.ac.uk
or call 02074447141. The cost is £249.00 +VAT.

ifs ProShare is part of the Institute of Financial Services.

Its web site says: “We are a not-for-profit membership organisation that provides a voice for the employee share ownership (ESO) industry. We act as an essential point of liaison between ESO professionals, service providers and companies committed to and involved in employee share plans and other share ownership schemes. We provide a forum for members to come together and share knowledge, ideas and expertise.

“Our aim is to support employee share ownership through liaison with members to provide information on share plans, to encourage sharing of best practice, commission research and engage in dialogue with relevant industry bodies. We represent the industry to policymakers, the media, the European Union and other regulatory and statutory bodies.”

For more information visit www.ifsproshare.org.