Commentary on Sections Overview Part 3: Eligibility of individuals Paragraph 15: The employment requirement
2991.This is the first of three paragraphs setting out the employment requirement in paragraph 14 of Schedule 8. Following the amendments made by paragraph 2 of Schedule 13 to FA 2001, this paragraph is now long, and may usefully be subdivided. This paragraph derives from paragraph 14(1) of Schedule 8.
2992.After the introductory sub-paragraph (1), sub-paragraph (2) deals with the core of the employment requirement. The SIP must provide that an individual may not participate in an award of shares unless employed by the company (or, in the case of a group plan, by a constituent company) (sub-paragraph (2)(a)). And if the plan provides for a qualifying period, the individual must have been employed throughout that period (sub-paragraph (2)(b)) by a qualifying company.
2993.Sub-paragraph (3) then provides that, in the SIP code, “the employment requirement” means the requirement specified in sub-paragraph (2).
2994.Sub-paragraph (4) is a drafting addition, indicating that the terms “qualifying period” and “qualifying company” receive further attention in paragraphs 16 and 17 respectively. The wording of this sub-paragraph is in alignment with wording used elsewhere (for example in paragraph 19(3) of this Schedule).