Search results

1 – 10 of 12
Article
Publication date: 11 November 2021

Adria L. Scharf

This case study examines employee share ownership at Central States Manufacturing, where the employee stock ownership plan (ESOP) shares stunning sums of wealth with employees…

Abstract

Purpose

This case study examines employee share ownership at Central States Manufacturing, where the employee stock ownership plan (ESOP) shares stunning sums of wealth with employees. Central States designs its ESOP to allow participants to access a portion of their ownership wealth while they are still employed at the company, through hardship and in-service withdrawals. This may make the “wealth benefit” of employee ownership more meaningful to lower-wage workers navigating economic challenges. The case study adds to the discussion about how employee ownership can benefit low- and moderate-wage workers and close the wealth gap.

Design/methodology/approach

Data were collected via: (1) published accounts, (2) structured qualitative interview with the chief financial officer (CFO), (3) follow-up emails and phone communication with company contact and (4) review of plan document language.

Findings

Workers at Central States Manufacturing – including truck drivers and production workers – build large sums of wealth through the ESOP. Central States innovates in its ESOP by permitting workers to access a portion of their ownership wealth while they are still working through hardship and service withdrawals.

Research limitations/implications

This is a mini-case study heavily reliant on the information provided by the CFO, in combination with background publications, and plan document language. It does not include employee interviews.

Originality/value

This paper lifts up an innovative company whose success and innovative ESOP plan design benefit frontline workers.

Details

Journal of Participation and Employee Ownership, vol. 4 no. 2
Type: Research Article
ISSN: 2514-7641

Keywords

Case study
Publication date: 6 April 2023

Olivier Pierre Roche, Thomas J. Calo, Frank Shipper and Adria Scharf

This case is based on primary and secondary sources of information. These sources include interviews with senior executives as well as documents provided by Mondragon and Eroski…

Abstract

Research methodology

This case is based on primary and secondary sources of information. These sources include interviews with senior executives as well as documents provided by Mondragon and Eroski. The interviews were conducted on-site. In addition, the authors researched the literature on both organizations.

Case overview/synopsis

Eroski is the largest of Mondragon Corporation’s coops. Since its founding, Eroski has faced numerous challenges. It has responded to each challenge with out-of-the-box thinking. In response to the pandemic, Eroski become an e-commerce supermarket as well as selectively continuing bricks and mortar stores. As the pandemic is winding down, Eroski is considering how to respond to the “new normal,” which is largely undefined. The question posited at the end of the case is, “Will Eroski be able to hold to its social principles, maintain its unusual governance model and other unusual practices, and survive this latest challenge?”

Complexity academic level

Eroski of Mondragon is a complex and unusual organization. To appreciate the challenges and how they were overcome by its unique business model, a student must have a minimum background in management, corporate finance and marketing. Thus, this case would fit well into a senior or graduate class on strategic human resource management. It is also recommended for the strategy capstone course usually offered during the last year of a business bachelor’s degree (senior level) to ensure that students are introduced to what Paul Adler refers to as an alternative business model. It can also be targeted for an advanced management course or a strategy course at the MBA and executive levels.

Article
Publication date: 25 December 2023

Joseph Blasi, Adria Scharf and Douglas Kruse

This viewpoint will present some statistical information about employee ownership in the US and interpret and analyze this information in order to address the barriers question…

Abstract

Purpose

This viewpoint will present some statistical information about employee ownership in the US and interpret and analyze this information in order to address the barriers question using material from qualitative interviews that the authors have conducted over the last ten years with practitioners in the field. There have been few actual empirical studies that sort out the different barriers to employee ownership. The authors have chosen to focus on employee stock ownership plan (ESOP) in the US because this is the principal example from which people could learn from, and the high prevalence of ESOPs plays an important role in the US. This overview will present interpretations of these interviews with conceptual arguments that cannot always be supported with either overwhelming empirical studies or arguments that conclusively eliminate one or other explanation. This is an initial attempt to bring some comprehensive treatment and data to this incipient discussion. This is based on an interpretive analysis of qualitative interviews without quantification or social survey methods used for measurement. The advantage of this approach is that it lays out a completely different level of analysis of the barriers to employee ownership in the US that is “closer to the ground” and more based in the views of front-line practitioners who are actually implementing it.

Design/methodology/approach

Analysis and interpretation of qualitative interviews.

Findings

The list of barriers that has been identified is not exhaustive. The preliminary conclusions are that (not necessarily in this order) limitations of investment banking models, poor supportive infrastructure, complexity and cost and regulatory issues, the lack of support by political parties and social movements, the sale of companies due to financial considerations and legal complexities and lack of clarity and resistance by Federal agencies are major barriers in the US. Various sectors of Wall Street has been amenable to employee ownership with the proper government and private sector support. What is needed now is a series of quantitative surveys and qualitative interviews of retiring business owners in closely held companies and of CEOs and CFOs in stock market companies in order to gauge the barriers that they believe are blocking their own action in the employee share ownership area. The Rutgers Institute for the Study of Employee Ownership and Profit Sharing is working on such a research agenda at this time. In addition, with the future size of the US employee ownership sector at stake, a more intensive one-year interview project would make sense in order to present these different explanations to key actors and practitioners and ask them to provide evidence to prove or disprove the relevance of the different barriers.

Research limitations/implications

Empirical research which can resolve which barriers are more important than others is presented, when possible; however, studies that provide metrics to compare different barriers are not available and need to be carried out.

Practical implications

Other countries considering employee ownership policies can learn from the US experience. US policymakers and legislators can learn from an original, recent discussion of barriers.

Social implications

If employee ownership sectors are to be developed, a careful discussion of barriers is most relevant.

Originality/value

Original document by the authors based on original interviews.

Details

Journal of Participation and Employee Ownership, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2514-7641

Keywords

Book part
Publication date: 6 July 2004

Douglas Kruse, Richard Freeman, Joseph Blasi, Robert Buchele, Adria Scharf, Loren Rodgers and Chris Mackin

What enables some employee ownership firms to overcome the free rider problem and motivate employees to improve performance? This study analyzes the role of human resource…

Abstract

What enables some employee ownership firms to overcome the free rider problem and motivate employees to improve performance? This study analyzes the role of human resource policies in the performance of employee ownership companies, using employee survey data from 14 companies and a national sample of employee-owners. Between-firm comparisons of 11 ESOP firms show that an index of human resource policies, nominally controlled by management, is positively related to employee reports of co-worker performance and other good workplace outcomes (including perceptions of fairness, good supervision, and worker input and influence). Within-firm comparisons in three ESOP firms, and exploratory results from a national survey, show that employee-owners who participate in employee involvement committees are more likely to exert peer pressure on shirking co-workers. We conclude that an understanding of how and when employee ownership works successfully requires a three-pronged analysis of: (1) the incentives that ownership gives; (2) the participative mechanisms available to workers to act on those incentives; and (3) the corporate culture that battles against tendencies to free ride.

Details

Employee Participation, Firm Performance and Survival
Type: Book
ISBN: 978-0-76231-114-9

Book part
Publication date: 6 July 2004

Abstract

Details

Employee Participation, Firm Performance and Survival
Type: Book
ISBN: 978-0-76231-114-9

Book part
Publication date: 6 July 2004

Abstract

Details

Employee Participation, Firm Performance and Survival
Type: Book
ISBN: 978-0-76231-114-9

Abstract

Details

Journal of Participation and Employee Ownership, vol. 6 no. 3
Type: Research Article
ISSN: 2514-7641

Book part
Publication date: 6 July 2004

Virginie Pérotin and Andrew Robinson

This volume of Advances in the Economic Analysis of Participatory and Labor Managed Firms consists of nine original papers grouped together under the title of “Employee…

Abstract

This volume of Advances in the Economic Analysis of Participatory and Labor Managed Firms consists of nine original papers grouped together under the title of “Employee Participation, Firm Performance and Survival.” The first four papers explore the growing area of empirical studies of participatory and labor-managed firms’ survival. The second group of three papers offers a number of new approaches and insights into the performance effects of participatory firms, while the final group of papers provides a broad-ranging synthesis and assessment of the experience of employee ownership and participation in transition.

Details

Employee Participation, Firm Performance and Survival
Type: Book
ISBN: 978-0-76231-114-9

Abstract

Details

Journal of Participation and Employee Ownership, vol. 4 no. 2
Type: Research Article
ISSN: 2514-7641

Article
Publication date: 21 April 2023

Sarah Reibstein and Laura Hanson Schlachter

Worker cooperative practitioners and developers often claim that democratic worker ownership advances egalitarianism within and beyond the workplace, but most of the empirical…

Abstract

Purpose

Worker cooperative practitioners and developers often claim that democratic worker ownership advances egalitarianism within and beyond the workplace, but most of the empirical evidence in the USA is based on ethnographic case studies or small-scale surveys. This study aims to leverage the first national survey about individuals' experiences in these unique firms to test for the presence of inequalities by gender, race and immigration status in the broader sector.

Design/methodology/approach

The study uses a 2017 survey comprising a sample of 1,147 workers from 82 firms. This study focuses on measures of workplace benefits that capture material and psychological ownership, wealth accumulation, wages, workplace autonomy and participation in governance. This study uses ordinary least squares regression models with fixed effects alongside pooled models to determine the effects of gender, race, immigration status and the intersection of gender and race on these outcomes, both within and between firms.

Findings

This study finds no evidence of wage gaps by gender, race or immigration status within worker cooperatives, with job type, tenure and worker ownership status instead explaining within-firm variation in pay. Still, this study documents sector-wide disparities in material and non-material outcomes by gender, race and immigration status, reflecting differences in individual-level human capital and job characteristics as well as widespread occupational segregation and homophily.

Originality/value

The paper offers a novel contribution to the literature on workplace empowerment and inequality in participatory firms by analyzing race, gender and immigration status in the most robust dataset that has been collected on worker cooperatives in the USA.

Details

Journal of Participation and Employee Ownership, vol. 6 no. 1
Type: Research Article
ISSN: 2514-7641

Keywords

1 – 10 of 12