Share Transfers?

If a company is worth £3m and I want to hire a new employee and give him/her shares to incentivize, what is the best (cheapest) way to get those shares to the new individual?

Answer:
Depends on your jurisdiction. Sounds like UK. Probably offering attractively priced share options.
One thing I would be careful of is how many shares you give and what sort of rights come with those shares. I would ensure you have to classes of shares at least, one with voting rights (yours) and one with non voting rights (his/hers).

Also consider whether you will be paying dividend on the shares.

I assume you mean the cheapest way for the employee to obtain the shares?
Currently your company probably has Ordinary shares, which are held by the shareholders with voting rights. Dividends may be paid out on these shares.
For employees I would suggest that you issue Deferred Ordinary shares, or 'B' shares - these would have no voting rights attached. A separate dividend can be issued on these at a reduced (or increased) rate to the Ordinary Shares.
You can then offer the employee a salary with the prospect of a dividend, if the company profits increase due to staff performance.

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