CICOPA: The Basic Characteristics of a Worker Co-operative

There are six basic characteristics of worker co-operatives in the CICOPA World Declaration of Worker Co-operatives:

  1. Creating and maintaining sustainable jobs, improving the quality of life for their members, creating dignity in human work, democratic self-management, and promoting community and local development.
  2. Free and voluntary membership
  3. The majority of workers in a worker co-operative should be members of the co-operative and the majority of a co-op’s members should be workers.
  4. The nature of the relationship with the co-operative is different from that of wage-based labor or independent contractors.
  5. The control and management of the enterprise is democratic, agreed upon and accepted by its members.
  6. Worker Co-operatives are autonomous and independent in terms of government and third party control as well as in the control of the means of production.

My co-operative, Union Cab, expresses the first characteristic in its mission statement: “To create jobs at a living wage or better in a safe, humane, and democratic environment by providing quality transportation to the greater Madison area.” I think that is a great summary of the first characteristic. This speaks to the core difference between worker co-operatives and other types of co-operatives. Our worker co-operatives exist to elevate the worker as a human being and to provide them the security and rights that they deserve as human beings. If a worker co-op isn’t engaged with this thought in mind, then it might as well be an US style ESOP or have a traditional ownership with a labor union representation. While we might joke about, there shouldn’t be self-exploitation in any worker co-operative.

The second and third characteristics bring up a serious challenge for modern worker co-operatives. I think that some worker co-ops misinterpret the “voluntary and open” clause. This isn’t to allow people to “choose” whether or not to accept their responsibility as an owner, it is to ensure that the co-operative doesn’t discriminate against visible minorities or create an enclave of “the right type of people”. It urges co-operatives to welcome all people and to create a co-operative that looks like their communities. I think that there is a danger in allowing a class of worker to exist in a worker co-operative who does not (through their choice or that of the co-operative) have a path that will lead to membership. Part of that danger is that the number of worker-owners will fall below 50%. In my mind, at that point, the worker co-operative ceases to be a “worker” co-operative and becomes an “employer” co-operative. This may create two classes of workers—those who are owners and those who are employees. Ultimately, I think that this will create different expectations for the groups. In addition, the workers need a controlling voice even if they allow other stakeholders.

The fourth characteristic brings up another point that I think is vital. Those of us engaged in a worker co-operative are a unique type of worker. We aren’t (and shouldn’t be) independent contractors and we aren’t wage workers. We need to quit thinking in that dichotomy even if the law doesn’t recognize us. If I had unlimited money and time, I would make the creation of a third worker, the worker-owner are legal reality. We need our own set of labor laws that recognize our control over the means of production.  This has many applications from labor standards to taxation. The US government’s rule show how bizarre the discussion is. They recognize a “partnership” of owners as long as each owner owns at least 2% equity. This means that the government recognizes a “partnership” of 50 people, but not 51. That is ridiculous. They need to recognize that organizations wherein the workers have “one person, one vote” are partners—are owners. This doesn’t mean that worker co-operatives should be free to self-exploit, but they should have more latitude to set their own rules and the tax laws should recognize that equity and profits work differently in a worker co-operative.

The last two characteristics speak to ensuring that worker co-operatives are not false fronts put up for other means. The membership must agree to the governance structure. If there is hierarchy, it needs to have control by the workers. Workers must have the ability to change their structure whenever they agree to do so. Lastly, just as all co-operatives must be independent, worker co-operative must work even harder at this. As a movement, we cannot tolerate pseudo-co-operatives masquerading as democracies when they are really controlled by government organization and politicians or as a means to defeat labor movements in emerging countries. Worker co-operatives should only be subsidiaries of a larger worker co-operative—and then, in a federated style similar to what Mondragon or the Italians follow.

The Basic Characteristics seem simple enough. However, there are many self-described “worker co-operatives” that do not meet them. These characteristics prevent the worker co-operative movement from being co-opted by multinationals seeking to enjoy good public relations while undercutting labor movements in emerging nations (or in developed nations for that matter. It instructs new worker co-op models such as The Cleveland Model in the way that a worker co-operative needs to be developed to ensure that the workers don’t become the well kept pets of social workers. It provides a check on existing worker co-operatives who need to grow and worry about the effect of difference types of workers entering their co-operative. There is no international or federal law defining worker co-ops in the US, Canada or the UK (although there should be), so it is up to those of us in the movement to hold each other up to these standards.

Next Week: Internal Functioning Rules of Worker Co-operatives

About John McNamara

John spent 26 years with Union Cab of Madison Cooperative and currently helps develop co-ops in the Pacific Northwest. He holds a Ph.D. in Business Administration and Masters in Management: Co-operatives and Credit Unions from Saint Mary's University.
This entry was posted in Movement, World Declaration and tagged , , , . Bookmark the permalink.

Leave a Reply

Your email address will not be published.