[Thanks to Michael Rubenstein for notifying the employment law community about this news via Twitter]
The House of Lords has voted (by 232 to 178) to strike down clause 27 of the Growth and Infrastructure Bill, which is the clause introducing the concept of employee shareholders.
This comes hot on the heels of the announcement in today's Budget that employee shareholder contracts will come into force on 1 September 2013 - an announcement which may have proven premature.
The Bill will now return to the House of Commons, where the government will decide whether to accept the defeat (in which employee shareholder contracts will not happen), or try to re-introduce the clause. It is rumoured that the Liberal Democrats are against employee shareholder contracts, and the result of a vote in the Commons is uncertain.