Worker co-ops: the advantages and pitfalls

What are the advantages of worker co-operatives, as well as the pitfalls to be avoided? Delegates at the Ways Forward conference in Manchester discussed the topic. Maria Young,...

What are the advantages of worker co-operatives, as well as the pitfalls to be avoided?

Delegates at the Ways Forward conference in Manchester discussed the topic. Maria Young, from the web design and development collective Agile, described what working co-operatively meant to their enterprise.

“Happy clients means a happy workforce. We get to redefine what ‘fair’ means,” she explained. Ms Young also talked about the ‘inherent integrity to co-ops’ which had attracted Agile’s founders to the model.

There were, however, also challenges. Ms Young mentioned the balance of time management between doing the work they are paid for by customers, and the day-to-day running of the enterprise.

“We could be more productive if we hired a manager, but we wouldn’t be as resilient. And we wouldn’t have time for education or training.”

(l-r) Paul Gosling, Cath Muller and Maria Young
(l-r) Paul Gosling, Cath Muller and Maria Young

The issue of finance was brought up, to which Ms Young explained the nominal £1 share policy they employed and the frequent salary reviews they undertook in order to keep the business profitable.

Paul Gosling, journalist and former Labour/Co-operative councillor, stressed the importance of worker co-ops not retaining too much profit: “You don’t want a pool of money sitting there, however you do want enough to develop and sustain yourselves.” He warned of the dangers of members becoming greedy if the co-op holds on to too much profit, and a better alternative is to immediately reinvest any gains back into the co-op.

The topic of platform co-operativism was also raised, as an example of a modern co-operative movement which is gaining momentum. Mr Gosling described the initiative, which encourages people to take control of the online tools they use, as “an alternative, a different sort of economy” and one closely aligned with the model of the Rochdale Pioneers.

Mr Gosling added that melding a big business with a democratic structure is not easy: “Those retail co-operative societies with which I have had close contact did not [achieve this]. Large building societies do no more than play lip service to democratic principles when they ‘advise’ their members which director nominees to vote for.”

He spoke of his doubt over whether a truly democratic large worker-controlled organisation was possible. “The John Lewis Partnership – which is a mutual, but not democratic – I believe utilises some of those strengths of stronger employee commitment and participation and an effective programme of employee-nominated improvements”, said Mr Gosling.

“Co-operative development has typically been much more effective when it has involved smaller organisations, which can either work collectively, or in more easily managed units of worker democracy.”

The end of the workshop saw a call for true co-operativism and an environment where people are democratically involved in every aspect of how their enterprise is run.

“I do believe in the future of co-operatives”, said Mr Gosling. “They can be networks of freelancers, who work together and share costs and burdens. They will form different types of relationships than we have seen in the past on shop floors and in offices. But they can work. And they will not have to overcome legacies of ingrained cultures and hierarchies.”

  • You can find all of our Ways Forward coverage here.
  • This article was amended on 25 January 2016 to include further quotes from Paul Gosling.
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