Why we need them and how to create them Worker Cooperatives are the game changer we need to take back control of our economy for the 99 % WORKER COOPERATIVES

DEFINITION A worker cooperative is a small business that is owned and operated by the people that work there and no one else*. * This means that there are no external investors or separate management layer. DEFINITION

Different types of cooperatives and collectives  Consumer Cooperatives (REI Inc.)  Housing Cooperatives (LA Eco Village)  Marketing Cooperatives (Sunkist)  Agricultural Cooperatives (CA Cheese)  ESOP (Employee Share Ownership Program)  Kibbutz (Collective farming communities)  Artists Collectives Worker Cooperatives Different types of cooperatives and collectives

A Cooperatively owned business is not necessarily a worker cooperative: The staff of a consumer cooperatives do not own the store The members who own the store do not work there The staff of a consumer cooperative do not make the business decisions Very often there are labor issues at consumer cooperatives A Cooperatively owned business is not necessarily a worker cooperative:

There are many types of worker ownership: ESOPs are Employee Share Ownership Programs – They have minimal ownership – And no decision making power There are numerous experiments in equity sharing – External stakeholders have voting rights – This can lead to conflicting interests – Must be Evaluated on case by case basis A True Worker Cooperative has no external investors, only the workers hold equity. Continuum of Worker Ownership

Why is this important ? Corporations consume workers in the same manner as they consume resources Externalizing costs for pollution as well as labor To create ever greater profits for external investors who do none of the work Why is this important ?

In A Worker Cooperative : The benefit created by the worker cooperative belongs to the workers who produced it Surplus (what is called profit in a corporate model) is distributed to the workers All business decisions are made democratically by the people that do the work In A Worker Cooperative:

12 Business Advantages of Worker Cooperatives: 1) Accessibility 2) Reduced Burn Out 3) No Crisis of Leadership 4) Viability in more challenging economic environments 5) Competitive advantage 6) Escape Corporate taxation on patronage dividend (SubChapter T of IRS code) 7) Flexibile financially 8) Job Security increased 9) Transparent Decision Making 10) Better Work Environment 11) Slow stable growth endures 12) Better Compensation, real ownership, and wealth for the Worker = steady workforce.

Benefits to community and environment Benefits to community and Environment 1) They pay taxes into the local tax pool. 2)They buy products and services for their businesses locally stimulating other businesses. 3)They spend their pay checks locally, helping other small businesses. 4)They buy a home and improve it, improving the neighborhoods they live in and employing locally. 5)They coach their children's soccer team or volunteer in their local community. 6)They are better stewards of the local environment because they live there. Most worker cooperatives are green businesses. 7)All the cooperators are considered business owners and community leaders and can be more engaged in the civic life of the community. 8)Because they source their resources locally and sell locally, transportation related pollution is reduced. 9)Because they can, cooperators are more flexible with regard to child care and other policies affecting families. Healthy families make healthy communities. 10) Regions with worker cooperative economies weather economic downturns better because wealth is retained and circulated in the local communities.

History of Worker Cooperatives Starting in the 1830 s, worker cooperatives were formed by Knights of Labor in 19 th century America, including hat makers, bakers, and garment workers and were designed to "cope with the evils of unbridled capitalism and the insecurities of wage labor". Knights of Labor The Populist Movement of the late 1800 s created financial an agricultural coomperatives Mondragon in the Basque region of Spain has 120 worker cooperatives and has been in business over 80 years* The Emilia-Romagna Region in Italy is made up of worker cooperatives* *Both are more economically stable and are more prosperous regions in their respective countries History of Worker Cooperatives

First you need decide what type of business you would like to create plus find others who would like to go into business with you Next you need to write a business plan. These are very specific documents describing how the business will operate, potential costs and profits Next write your Constitution and By-Law so you can register your company (“Incorporate”) with the state. Next apply for all permits and licensing Then you can apply for business loans and funding you need to start your business with, Buy equipment plus secure a location and sign a lease Steps to creating a Worker Cooperative

Money Money Money Each Worker/Cooperator will have a financial stake in the business but it can be financed over time The first funding source is always the “ Three F “ Funding: “Friends, Family and Fools” Worker Ownership Fund - National loan fund specifically for worker cooperatives NCB - National Cooperative Bank LEAF - Local Enterprise Assistance Fund: the only national fund that focuses its investment on worker cooperatives, in business since Money Money Money

Next Steps We need to form an INCUBATOR: a community organization that assists people in forming worker cooperatives We need expertise: lawyers, entrepreneurs, fund raisers, administrative experts and organizers We need to find people who want to go into business for themselves as worker cooperatives Training may be needed in basic business practices like bookkeeping, payroll, and taxes Next Steps

Support Organizations US Federation of Worker Cooperatives National Cooperative Business Association California Center for Cooperative Development Arizmendi Association of Bakeries Network of Bay Area Worker Cooperatives Mondragon corporation.com/ENG.aspxhttp:// corporation.com/ENG.aspx Support Organizations

Websites and Contact Information American.coop is all about Worker Cooperatives in the USA OccupyJobs,org is my web site which has links to this and many other resources THIS WAY OUT : A Step by Step Guide to Setting Up a Worker Cooperative: a Video from Mighty Small Films Evergreen Project in Cleveland video THE TAKE - The story of Argentina's occupied and recovered workplaces My contact information: Dr Lisabeth Ryder and cell Websites and Contact Information