Employment Tribunal and Director Rights

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nicola jane

  • #1
    I have a question for you legal bods out there, as I have no idea at all about this type of thing.

    Today, I was discussing a situation involving my friends brother, who has recently won an unfair dismissal case against his previous employer. It turns out he was also a 10% share holding director and when they unfairly dismissed him in a ‘redundancy’ situation they sent a cheque for what they believed to be a fair amount for the shareholding. Having had no say in the value of these shares he hasn’t cashed this cheque.

    The question that came up was as follows;

    If the previous employers were found guilty of unfair dismissal, is it legal that they pay a nominal fee to get back the shares of a director without agreement of their value?

    This is a bit out of my league, but some advice would be appreciated.
     

  • #2
    A difficult question to give an answer, you would really need specific advice on this one I feel.
    I wouldn't rely on an unfair decision to help in this instance as many decisions are based purely on a technicality or slight failing to adhere to procedure, the chap was not reinstated if that gives any indication.

    With regards the share issue I feel this would need the articles or any shareholders agreement looked over to see if there were any buy back options or shares in the event of termination etc, for that you would be best taking proper legal advice.
     
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    obscure

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  • #4
    It will depend on what directors/shareholders agreements are in place. Being a director and being a shareholder are two separate things. Just because he is dismissed as a Director it doesn't automatically give them the right to recover/buy back the shares UNLESS there is an agreement in place that allows this.
     
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    Tungstone

  • #5
    nicola jane said:
    If the previous employers were found guilty of unfair dismissal, is it legal that they pay a nominal fee to get back the shares of a director without agreement of their value?

    This is a bit out of my league, but some advice would be appreciated.
    Click to expand...

    Employment as a director and holder of shares are two seperate things
    You can sell your shares
    You cant be paid off
     
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