When workers matter most: a study of worker cooperatives and the prioritization of workers through COVID-19

Abstract

PurposeAs a part of the authors’ continued efforts to understand the experience and trends related to small business cooperatives, the US Federation of Worker Cooperatives (USFWC) and the Democracy at Work Institute (DAWI) explored themes around the impact of the COVID-19 pandemic on worker cooperatives and democratic workplaces.Design/methodology/approachThe USFWC and DAWI conduct a biannual Economic Census of worker cooperatives and democratic workplaces. Survey themes this year included questions around the impact of the COVID-19 pandemic on individual firms.FindingsGeneral findings indicate that worker cooperatives experienced financial losses similar to conventional small businesses, but that this varied widely by industry. Although it has been found that BIPOC-owned conventional small businesses have been some of the hardest hit during the pandemic, the authors find that there may be some mitigating protective effects of the worker cooperative form when the authors explore the impacts on worker cooperatives with a majority BIPOC workforce. Additionally, the authors find that worker cooperatives and democratic workplaces strive to ensure the safety and wellbeing of their workers even when facing significant financial challenges throughout the pandemic.Research limitations/implicationsThis research utilizes non-random convenience sampling in data collection. The outreach for our biannual Economic Census is concentrated on a highly connected worker cooperative and democratic workplace network, the experiences of which may not generalize to the larger worker cooperative and democratic workplace landscape. Additionally, outreach efforts were hindered by challenges presented by the pandemic that were not present in prior census years, as was firm bandwidth to respond, which likely affected the sample composition in comparison to prior years.Originality/valueWorker cooperatives have been proven to be a resilient crisis response form of business, but little is known about how the worker cooperative ecosystem in the United States is faring in the face of the continuing COVID-19 crisis.

Employee-Owned Businesses’ Responses During the Pandemic: Economic, Non-Economic Goal and Democratic Resilience and Their Link to Ownership, Control and Benefit

“…Our paper extends understanding of the interplay of ownership, control and benefit by considering (dis)benefit in the form of financial reserves and debt burden. In concluding that length and level of EO, to a greater extent than financial resource, play a role in non-economic goal resilience, we add explanatory depth to the literature on job protection in EOBs (Birchall and Hammond Ketilson, 2009;Smith and Rothbaum, 2013;Ollé-Espluga and Bartoll, 2019) and avoidance of lay-offs during the pandemic (Prushinskaya et al, 2021;Meira et al, 2022). The paper also makes a meaningful contribution to debates about the future of work in a post-pandemic world (Ashford et al, 2020;Leach et al, 2021) by demonstrating the importance of EOB longevity to economic and non-economic goal resilience, and the role of level of EO to non-economic and democratic resilience.…”

“…Emerging evidence of EOB non-economic goal performance during the pandemic renders a picture of employment protection (Prushinskaya et al, 2021;Meira et al, 2022) where there is financial "resource slack" (Borzaga, Carini and Tortia, 2022) and continued generation of profit (Billiet et al, 2021). The indications are that employee-owner decision-making control over financial benefit appears significant for non-economic goal resilience.…”

Participatory Bureaucracy: Addressing Gender Inequality in Worker Cooperatives

“…As liberationist projects, worker cooperatives have sought to understand what their workers need and want, and then to transform labor and even markets as much as possible to provide for those needs and wants (Gibson-Graham, 2003;Pérotin, 2013;Berry and Bell, 2018). These liberationist projects have varied over time and space: liberation from oligarchy (Greenberg, 1986;Hernandez, 2006;Healy, 2011;Blasi, Freeman and Kruse, 2013), industrialization and rationalization (Webb and Webb, 1897;Rothschild-Whitt, 1979;Jackall, 1984;Gibson-Graham, Cameron and Healy, 2013;Hoffmann, 2016;White, 2018), capitalism (Marx, 1864;Gunn, 2004;Leikin, 2004;Huertas-Noble, 2010;Safri, 2011;Gourevitch, 2013;Ji, 2019), neoliberalism (Gibson-Graham, 2003Vieta, 2009;Pérotin, 2013;Williams, 2013;Dufays et al, 2020;Zitcer, 2021), racism (Du Bois, 1907Leikin, 2004;Gordon Nembhard, 2014;Berry and Bell, 2018;Prushinskaya et al, 2021), and sexism and heterosexism (Taylor, 1983;Mellor, Hannah and Stirling, 1988;Hacker, 1989;Loe, 1999;Sobering, 2016;Davis, 2017).…”

“…While corporations are imagined to fit into the upper left corner-both rule-bound and top-down to manage their massive workforces-in practice many have distributed more decision-making power to work teams than in the past. Similarly, a new generation of worker cooperative studies suggest that contemporary worker cooperatives are less opposed to growth than those of the 1970s and 1980s, and more open to bureaucratic logics of job specialization, formal rules, and rationalized work processes (Berry and Schneider, 2011;Pinto, 2018;Borowiak and Ji, 2019;Spicer, 2020;Prushinskaya et al, 2021). Importantly, they are also less likely to exclude working-class and Black and Brown members, or reproduce internal inequalities (Schlachter, 2017;Berry and Bell, 2018;Pinto, 2021).…”

“…In the current moment, the most rapid worker cooperative growth is in businesses primarily populated by low-income and/or immigrant workers (Palmer, 2020;Schlachter and Prushinskaya, 2021). As in previous generations, contemporary worker cooperatives remain committed to workers' democratic control, but there is more variation in how they structure it: from entirely flat and informal small collectives to complexly hierarchical and highly formalized organizations of thousands of workers (Prushinskaya et al, 2021). Worker cooperatives' common "double bottom line"-the commitment to social as well as financial goals-creates conditions and organizational practices that unintentionally lead to gender inequality, arguably a more common way in which inequality is reproduced (Martin, 2006).…”