On July 23rd, 2012, Senator Bernie Sanders (I-VT) introduced two bills to support the expansion of employee owned businesses in the US. The underlying rationale behind the legislation focuses on the increased productivity and stability of businesses in which employees are also owners. By helping employee ownership and participation in businesses to become more widespread across the United States, the two bills would help preserve jobs and build a stronger economy.
If passed, the first bill–the WORK Act–would create an Office of Employee Ownership and Participation within the US Department of Labor. This office would support existing programs and encourage the development of new programs dedicated to employee ownership and employee participation through grants, training, technical support, and education and outreach. The inspiration for this legislation comes from the success of the Vermont Employee Ownership Center in Sanders’ home state. This center has been especially effective in education around the importance and benefits of worker ownership.
The second proposed bill, the United States Employee Ownership Bank Act, would create the United States Employee Ownership bank to provide loans to employees allowing them to purchase their company through an employee stock ownership plan or as a worker cooperative. The proposed bank would also provide loans to businesses already owned by their employees that were seeking to expand.
By helping transition existing businesses to employee ownership and helping existing employee owned businesses thrive, these bills, co-sponsored by Senators Patrick Leahy (D-VT), Sherrod Brown (D-OH), Richard Blumenthal (D-CT), and Daniel Akaka (D-HI), could play an important role in helping create and preserve jobs in a growing sector of the US economy: there are currently 10 million people in the United States working in employee-owned companies. Legislation similar to the WORK act was introduced in the House last year by Rep Chakka Fattah (D-PA); his National Cooperative Development Actcurrently has 11 co-sponsors. Even if they do not pass, the precedents set by the introduction of these bills helps open space for a national conversation about new ways to rebuild our national economy: our own policy proposal, “Rebuilding America’s Communities,” for instance, outlines a more ambitious strategy that would integrate federal support for worker ownership within a broader community wealth building framework.