Consumer & Worker-Owned Cooperatives
Deborah Groban Olson has worked with these Co-ops and Co-op-Like ESOPs.
Housing co-op to provide affordable housing (See: Mustard Tree Co-op)
Multi-stakeholder worker and consumer co-op. (See: High Five Co-op Brewery)
Worker co-ops created within ESOPs employee stock ownership plans: A company that owns stock through an ESOP, is able to use the many tax ESOP tax savings and advantages for raising and borrowing money. However, it can operate much like a co-op if it has one-vote-per-person voting on all shareholder issues and a highly participative decision making structure. Atty. Olson created co-op style ESOP companies at MBC Ventures, Republic Container, and Once Again Nut Butter. The key difference between ownership by an ESOP and co-op ownership is their ultimate ability to keep the company independent. In an ESOP, the workers are beneficiaries of a pension plan that is controlled by a trustee (who may be appointed or elected). The Trustee’s duty is to the beneficiaries as retirees, who may be legally forced to sell the business if s/he gets a good offer. Co-op members are actual equity owners of their co-op interests. They have the final decision on any possible sale which usually requires a super-majority vote.
Worker co-ops including the Southwest Detroit Construction Cooperative (SWDCC) and its related painting and plastering co-op.
Marigold Food Co-op in Dearborn that did not launch as a separate co-op but instead donated its resources with the Detroit People’s Food Co-op (which is not our client).
Education and Recreation Co-op Circle Pines Center - Deb Olson is a lifelong member and longtime board member.
Learn more about the many types of co-ops, and read co-op case studies.
Support Systems are Important for Start-up Worker Co-ops.
To be sustainable, start-up worker co-ops, (and especially those serving workers with limited education) need a supporting joint business resource or community support organization. In That is why the Mondragon, Emilia Romagna, Evergreen Cooperatives in Cleveland and the Arizmendi Co-ops in Berkeley, CA have all created mutual support organizations for back office and business development functions. The Southwest Detroit Construction Cooperative (SWDCC) case study explains how a well-intentioned worker co-op ceased to survive when the back office support became unavailable.
In Detroit the organization to contact is the Center for Community Based Enterprise, a Detroit co-op developer that can assist them with feasibility studies, legal assistance and training. The national support organizations are the Democracy at Work Institute and the US Federation of Worker Cooperatives.
5 Reasons to Consider an Eligible Worker Owned Co-op (EWOC)
An EWOC is an enterprise where the majority of co-op members are employees and a majority of voting stock is owned by co-op members. A majority of the board of directors is elected by members on a one-vote-per-person basis. Advantages include:
Workers have more control over co-ops than ESOPs.
The sellers can get a fair price for their stock with less regulation.
The seller’s proceeds from a stock sale to a worker co-op may be tax-free.
Co-ops are less expensive and less regulated than ESOPs.
Sale to a co-op keeps the company independent and rewards the people who made it a success.
EMPLOYEE OWNERSHIP THAT FITS YOUR NEEDS
We can smoothly transition your privately-owned business to a worker-owned one that meets the seller’s objectives, is socially responsible and includes employee participation. Learn more
TESTIMONIAL
“The residents were overjoyed when we became owners of our building through the Mustard Tree Co-op. We had many challenges and believed that co-op ownership was vital to preserving our community. We were looking for an attorney who had experience and was concerned about us. Atty. Deborah Olson has always been responsive, dedicated, and thorough and cared about the needs of our members. She involved us as clients in every step of our legal work and we learned a great deal. She helped us do things the right way. She has represented us or almost 20 years and we would strongly recommend her to others.” - Sheree Walton, President of Mustard Tree Cooperative
