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December 2009 In this Issue: • Employee Ownership in a Tough Economy Vermont Employee Thank you to
Co-sponsors: • Atlantic Management Company Supporters: • Blue Ridge ESOP Associates • Cooperative Fund of New England • Crowe Horwath LLC • Fleischer Jacobs Group • Green Mountain Coffee Roasters • Hallam-ICS • Hickok & Boardman Group Benefits and Retirement Solutions • KeyBank • King Arthur Flour Company • Merritt & Merritt & Moulton • Pension Works • Principal Financial Group • Red House Building • Schatz Law Offices |
In the News
 Senator Sanders to Introduce New Legislation
Supporting Employee OwnershipSenator Bernard Sanders of Vermont will introduce two new bills that would seek to expand employee ownership in the United States. The first bill, the Worker Ownership, Readiness and Knowledge (WORK) Act would create an Office of Employee Ownership and Participation within the Department of Labor. This Office would promote employee ownership and employee participation in company decision making by providing education and outreach, training, grants, and technical support for local programs (such as VEOC) dedicated to the promotion of employee ownership and participation. The second bill, the U.S. Employee Ownership Bank Act, would provide loans and loan guarantees to employees to purchase a business through an ESOP or a worker-owned cooperative. Sen. Sanders is currently seeking original co-sponsors for the bills, which he plans to introduce in the coming weeks. Senator Patrick Leahy of Vermont and Senator Sherrod Brown of Ohio have already signed on as co-sponsors. Click here for details on the two bills. VEOC Board of Directors Elects New Members;
Creates New Advisory Board The Vermont Employee Ownership Center’s Board of Directors has elected four new members to help lead the organization. Joining the Board of Directors are Dave Fitz-Gerald, Stephen P. Magowan, Randy Rowland, and Mike Sessions. The VEOC has also created a new Advisory Board that will provide guidance to the governing board on key issues affecting the organization. These issues include major policy decisions, legislative actions and recommendations, and the identification of funding sources. Joining the Advisory Board are Bill Carris, Tom Torti, and Steve Voigt. Click here for photos and bios of our newest board members. Steelworkers Form Collaboration with MondragonThe United Steelworkers (USW) and Mondragon Internacional, S.A. have announced a framework agreement for collaboration in establishing Mondragon cooperatives in the manufacturing sector within the United States and Canada. The USW and Mondragon will work to establish manufacturing cooperatives that adapt collective bargaining principles to the Mondragon worker ownership model of “one worker, one vote.” “We see today’s agreement as a historic first step towards making union co-ops a viable business model that can create good jobs, empower workers, and support communities in the United States and Canada,” said USW International President Leo W. Gerard. “Too often we have seen Wall Street hollow out companies by draining their cash and assets and hollowing out communities by shedding jobs and shuttering plants. We need a new business model that invests in workers and invests in communities.” Click here to read the full press release. Lake Placid firm creates Employee Stock Ownership PlanAdworkshop, a marketing communications firm in Lake Placid, NY, recently announced that it has created an Employee Stock Ownership Plan. The Adworkshop ESOP program involves the selling of 33 percent of the company, via shares of stock, to its employees as part of their retirement benefits. Adéle and Tom Connors retain their positions as Principals. "We feel very fortunate that we have maintained this business over the last 32 years," states Tom Connors. "Employees now have even more incentive to excel in their jobs because they are also working to provide for their own financial security." Click here to read the full press release.
Employee Ownership in a Tough Economy By Martin Staubus (Republished with permission from the Beyster Institute) Circuit City. Linens-n-Things. Frontier Airlines. Mrs. Fields Cookies. Lehman Brothers. These are just a few of the companies that have failed in recent months. They are the ones with the well-known names, but there are many more – smaller and more anonymous perhaps – that have also closed their doors. The reasons for the failures can be seen on the front page of the newspapers every day. Banks aren’t lending. Consumers aren’t spending. The economy is in recession. If you run a business, how are you going to counter those pressures? What’s it going to take to be one of the survivors – to make it through this difficult period and hang on until sun comes out again and the economy regains its vigor? Certainly it will take focus, innovation and agility on the part of business leaders. “Business as usual” won’t cut it. Creative thinking about new markets, new suppliers, new processes and new customers will be essential. As a leader, you put this responsibility on yourself and give everything you’ve got. Yet that may not be enough. Getting through today’s challenges will require not only your best efforts, but the best efforts of your whole team. From CEO to receptionist, everyone in your organization must understand that “business as usual” equals failure. Everyone can – and must – make a difference. They have to come together as a team to fight this. Get focused. Find ways to get things done cheaper. Keep existing customers tickled pink. Locate new customers, even if it means talking to friends, family and strangers on the street. Figure out how to repackage what you do to appeal to a frugal marketplace. Even take a look at compensation and work out ways to stretch those dollars further to meet the company’s cash flow constraints. Can you ask your people to do those things – to fight with everything they’ve got – to save your business? The answer is no. Not if it’s someone else’s company. Working that hard has never been part of the standard employment deal. If it’s only a paycheck that’s at stake, employees simply aren’t going to rise to that challenge. But what if it’s not just someone else’s company? What if they see it as their company? Experience shows that employees will come together to fight through difficult times to save the company if they actually own a piece of the action and feel in their gut that they are co-owners. Now it’s a situation in which they have much more at stake than just a paycheck. If employee ownership is already part of your company, you’re in a fortunate position, able to tap this remarkable well of team strength. If not, it’s not too late. Think in terms of making a deal with your people. A deal that says, “I’m going to give you a stake in the future of this company. I’m bringing every one of you on as a co-owner of this business. If we can pull together and get our company through these tough times, you will have accomplished something to be proud of and changed your economic status in a very positive way. This is not a guarantee of anything. But it is an opportunity. The companies that survive this period will be in a tremendous position to prosper when economic growth returns. Let’s be one of those companies.” So … what if you like this idea? You buy the notion that employees who own a stake in the business will fight harder for their company. Now, how do you implement that concept? Click here to read the full story. This project is funded by a grant from the U.S. Small Business Administration (SBA). SBA’s funding should not be construed as an endorsement of any products, opinions, or services. All SBA-funded projects are extended to the public on a nondiscriminatory basis. |
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