French and Canadian worker co-ops sign agreement

The Canadian Federation of Worker Co-operatives and the Confederation of Co-operative and Participatory Societies of France (CGSCOP) have signed an agreement to exchange best practices in worker co-operatives....

The Canadian Federation of Worker Co-operatives and the Confederation of Co-operative and Participatory Societies of France (CGSCOP) have signed an agreement to exchange best practices in worker co-operatives.

The organisations – the biggest co-operative federations in their countries – will share experiences on worker buy-outs. Every year CGSCOP provides support to enable the transfer of enterprises to employees, in the form of worker co-operatives.

“The employees involved are in many cases able to collectively buy the enterprise that employs them, particularly when the owner hasn’t been able to identify a successor outside the business. With the right supervision the employees can become co-owners, co-investors and co-managers,” said Alain Bridault, president of FCCT.

CGSCOP registered 263 new co-ops in 2013 and 280 in 2014. The co-operative model has also been used by workers trying to save their enterprises from bankruptcy, with 50 successful transitions into employee ownership, which helped save 1,000 jobs in 2013 and 2014.

With the passing of the 2014 Social and Solidarity Economy Law, France has witnessed an increase in the number of worker buy-outs. The law provides for the creation of transitional co-operative societies enabling employees to take over the enterprise under a co-operative structure even when they do not have the majority of capital.

This means an external investor could hold over 50% of the capital of the newly formed co-operative society for seven years. Employees have the opportunity to become major stakeholders eight years on from the transition of the enterprise to the co-operative model. Over 277 new worker co-operatives were set up in France since the law was passed last year, and 20% of these were the result of takeovers.

Figures published by CGSCOP in 2014 confirm that co-operatives are more resilient than other type of enterprises. Their survival rate after three years was 77%, as opposed to the 65% rate in the case of other companies. Worker co-operatives also had a profit rate of 6.5%, higher than that of French enterprises (6.3%).

CGSCOP president Patrick Lenancker added: “The Canadian experience will no doubt improve our knowledge. With this first attempt, we mutually pledge to share best practices that we have both observed and documented. We are certain that this transatlantic dynamic will collectively enrich us.”

The worker co-operative model is well known in Quebec and a number of successful worker buyouts have already taken place. One example are the paramedics co-op in Quebec, which have a joint turnover of CAD $90m and provide 75% of the hospital transport in the province.

Other potential case studies include Rôtisserie St-Hubert, a co-operative restaurant, the radio station M-105 and the co-operative Promo-Plastik in Quebec.

“We have already proved many times that the social and solidarity economy is a viable and sustainable solution to financial insecurity. Now we only need to prove to the people and workers that worker co-operatives are the enterprise model of the future,” said Mr Bridault and Mr Lenancker. “By sharing expertise we will be able to save thousands of jobs in the following years.”

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