A worker cooperative is a type of cooperative where the workers own and control the business. In a worker cooperative, the workers are both the members and the owners of the business, and they share in the profits and decision-making process. It is a cooperative that is owned and managed by its employees. This control may refer to a firm in which every worker-owner participates in democratic decision-making, or it may refer to one in which management is elected by every worker-owner who has one vote.
Worker cooperatives are based on the principles of democracy, equality, and solidarity. They are often seen as a more democratic and empowering alternative to traditional hierarchical business structures, where decision-making power and profits are concentrated in the hands of a few owners or shareholders.
A worker cooperative is a values-driven business that prioritizes worker and community benefit. The following are the two most important characteristics of worker cooperatives:
- Workers own the company and share in its financial success based on their labor contributions to the cooperative.
- Workers have representation on the board of directors and vote for them, in accordance with the principle of one worker, one vote.
In a worker cooperative, the workers typically elect a board of directors to oversee the business and make strategic decisions, but the day-to-day operations are managed by the workers themselves. This can include everything from setting salaries and benefits to deciding on new products or services to offer.
Worker cooperatives can be found in a variety of industries, including manufacturing, agriculture, retail, and service industries. They are often associated with the social economy or solidarity economy, which seeks to promote economic justice and community well-being through the creation of more equitable and democratic economic structures.
Worker cooperatives are gaining popularity, as evidenced by industry and sector concentrations and the expansion of a support infrastructure that includes financing, technical assistance providers, and trade associations at the local, regional, and national levels. Worker cooperatives are also gaining popularity as a strategy for job creation and wealth creation, with community organizations, cities, and small business advocates seeing potential in the form to build a more inclusive economy.
