Worker Ownership: Will It Take Hold?

January 1 st 1984

A small but growing number of workers in the U.S.A. are trying worker ownership, usually spurred on by declining profits in the enterprise or even the prospect of bankruptcy and closure.

One such experiment in worker ownership was undertaken by the former employees of two A & P stores in Philadelphia. A & P had closed over 40 unprofitable stores in the area, but after negotiations, the company agreed to reopen at least 20 stores while employees accepted a temporary 20 per cent wage cut, reductions in benefits, and an incentive plan aimed at curtailing labour costs. In addition, A & P agreed to sell two of its stores directly to the employees and, in the event that any of the other stores closed again, the employees would be granted 'the exclusive option' to purchase the company's assets.

While most of the employees chose to remain in the reopened company stores, about 60 workers decided to risk operating their own stores and each invested $5,000. Assisted by their union and experts in worker ownership, the employees spent four months preparing for their new role as worker-owners. The stores opened in 1982, and by September of 1983 reported 20 per cent and 40 per cent increases in sales. Faith Mason, bookkeeper at one of the stores, explained: "It's my store. We all feel that way about it. Owning the company gives us more incentive to make it a success. We're putting in about 60 hours a week—40 as workers, 20 as owners. And you know what? I actually enjoy coming to work." Sherman L. Kreiner, of the Philadelphia Association for Cooperative Enterprise, said: "Corporations and labour unions in this country have never come up with anything like this before. In many respects, it's a unique and unprecedented agreement. It gives workers more authority and more responsibility, and provides avenues for them to learn to be managers."

From Slicing Meat to Managing

Marge Bonacci, an owner of the new 0 & 0 (Employee Owned & Operated Supermarket), said that she was initially skeptical about the employees' (including her own) ability to manage the store. She said: "I sliced lunch meat. How do I know what a manager does?" But she learned fast, and has become an enthusiastic supporter of the new scheme, with absolute confidence that it will work. "Worker ownership is definitely the way to go. I see a great future for it in this country. I've tried it all, and believe me, this is the best. It's going to last. You're going to see a lot of it, all over America."

Some examples of the approximately 200 worker ownership enterprises in the U.S.A. are Weirton Steel in West Virginia, South Bend Lathe in Indiana, Rath Packing Co. in Iowa, and Hyatt Bearings in New Jersey. A worker-owned chain of less well-known businesses along the North Carolina coast handles a ranqe of products including clothing, bakery goods, newspapers, caskets, and houses. A struggling cut-and-sew factory in Windsor, North Carolina was taken over by its employees and is now picking up orders and becoming more firmly established. Its 30 worker-owners are each paid close to $200 per week, a fair wage in that area, and share the decision-making and year-end profits.

A number of organizations specializing in providing advice for worker-owned companies have sprung up, including the Industrial Cooperative Association in Boston, the Philadelphia Association for Cooperative Enterprise, and the Center for Community Self-Help and the Corporation for Democratic Businesses both in Durham, North Carolina.

Steven L. Dawson, executive director of the Industrial Cooperative Association, says: "We don't yet have a conceptual framework for these structures, or a vocabulary to describe them. This is not worker capitalism, and it's not state socialism. It's a third way, a new alternative that points toward the creation of democratic firms in a democratic economy" (John Egerton, "Workers Take Over the Store," The New York Times Magazine, September 11, 1983, p. 165).

 

Harry Antonides came to Canada in 1948, initially working as a farm hand and railway labourer. After over a decade working in a chemical plant in Sarnia, Ontario, Harry joined the newly forming Christian Labour Association of Canada (CLAC) in 1962 as a field representative. By 1970 Harry became director of research and education. In 1974, he was a founding member of the Work Research Foundation (now Cardus) and publisher of their sole publication, Comment magazine. A prolific writer and dynamic speaker, Harry delivered lectures all over North America and published numerous articles, reviews, and essays. He is author of several books on Christianity, labour, and economics, including Multinationals and the Peacable Kingdom (1978) and Stones for Bread: The Social Gospel and its Contemporary Legacy (1985). Harry is retired and lives with his wife Janet in Willowdale, Ontario.

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