Worker co-ops: Like ESOPs, but better

From the New Hampshire Business Review:

I read with great interest the Feb. 21-March 6 article by Steve Burke, Beth Fowler and John Bentas of the McLane Law Firm heralding “the biggest transition of business ownership in history.” They’re right – but they only got half the story. As the three tax lawyers pointed out, ESOPs (employee stock ownership plans) can be an effective exit strategy for owners of closely held businesses who are hoping to cash out while providing retirement security for their employees. But ESOPs fall well short of true employee ownership. The great ownership transition includes another option – worker cooperatives. Unlike an ESOP, which merely makes present employees future beneficiaries, a worker co-op is democratically controlled by current employees on a one-person-one vote basis. And since the first modern cooperative was created by a group of disenfranchised British weavers in 1844, this form of doing business has thrived by putting people in control of their own fate while plowing the wealth they generate back into their communities.

Read the full article here: