New production and worker cooperatives and the employee buyout phenomenon

Research Area: Innovative models
Scientific coordinator: Marcelo Vieta

Project status: Completed

Following many company crises and the high (and growing) rates of youth unemployment, particularly among graduates, there has recently been a renewed interest in cooperation among workers. The employee buyout phenomenon, when workers acquire ownership and control of a company, is now one of the innovative ways that employees can try to save companies facing closure, keeping their jobs and ensuring the know-how acquired over years of employment is not scattered. The transformation of ordinary companies into cooperatives is increasingly relevant today, and monitoring it also offers a chance to study the most recent evolutions and new developments in production and worker cooperatives.

In light of the interest in the topic, and the objective difficulty of monitoring a complex phenomenon spread across geographic areas and sectors, the research was supported by CFI (Cooperazione Finanza Impresa). This institute, whose members include the Italian Ministry for Economic Development, supports and funds investment in production and worker cooperatives, including in regards to the Marcora Law.

Objectives

The focus of study is the analysis of the recent evolution of cooperatives started by workers of pre-existing companies in crisis, also known as “worker-recuperated enterprises”. Given the need to provide a theoretical framework to the study and to evaluate the relevant legal areas, one of the research study’s initial objectives was to provide an introduction to the context and look at the historic evolution of the phenomenon. In addition, the empirical analysis examines the phenomenon of employee buyouts in terms of numbers, looking at the number of cooperatives created, their economic size and their resilience, in other words the success rates of the new organizations. This allows an exploration of the relevance of the phenomenon not only as a new response to the risks of unemployment and company closure, but also as an efficient and long-term solution. Finally the project wants to understand how the conversion processes took place and what it means today to be a “recuperated” production and worker cooperative in terms of governance, management and challenges.

Main results

The investigation into recuperated worker cooperatives has led to important theoretical reflections on the relevance of these organizations and the legal and socio-economic context that has supported their emergence and evolution. The empirical part was structured around a number of fronts, yet some difficulty was still experienced with the data gathering. While CFI made it possible to monitor worker cooperatives that had requested funding for buyouts, it is true (as shown by supplementary sources) that there are many other recuperated worker cooperatives that did not obtain funding and which are therefore not officially recorded in any register as being recuperated enterprises. Integrating different sources thus allowed an initial mapping, though probably still incomplete, while the Aida database and other integrated databases allowed an evaluation of the economic and financial situation of these organizations and their resilience. From here, it is possible to confirm the very recent emergence of many new recuperated worker cooperatives that are responding to the crisis and the closure of many companies and which have long-term survival rates of close to 50%. These organizations are found all over Italy and in many different sectors. The administration of questionnaires to all the cooperatives on CFI’s mailing list allowed the gathering of information about the characteristics of these enterprises. Even though only 25 cooperatives responded to the questionnaire, the data highlighted participatory governance and a good capacity for innovation but varying significance of the history of recuperation now in both the motivations of the workers and in the cooperatives’ management policies. To supplement the questionnaires, in-depth interviews are now being conducted with a number of cooperatives in order to better investigate the conversion process and the most recent evolutions.

Publications

REPORTS AND WORKING PAPERS

Vieta, M, Depedri, S., & Carrano, A. (2015). The Italian road to recuperating enterprises and the Legge Marcora workers’ buyouts: A report on Italian imprese recuperate in times of crisis. Trento, Italy: European Research Institute on Cooperative and Social Enterprises (forthcoming).

Vieta, M. (2015). The Italian road to creating worker cooperatives from workers’ buyouts: The emergence of Italy’s worker-recuperated enterprises and the Legge Marcora framework. SSRN and Euricse Working Papers, 78/15. Trento, Italy: European Research Institute on Cooperative and Social Enterprises. [Link]

Vieta, M. (2013). The emergence of the empresas recuperadas por sus trabajadores: A political economic and sociological appraisal of two decades of self-management in Argentina. SSRN and Euricse Working Paper 55/13. Trento, Italy: European Research Institute on Cooperative and Social Enterprises. [Link]

 

SPECIAL ISSUE OF THE JOURNAL OF ENTREPRENEURIAL AND ORGANIZATIONAL DIVERSITY

Vieta, M. & Lionais, D. (Eds.). (2015). Editorial: The cooperative advantage for community development (special issue). Journal of Entrepreneurial and Organizational Diversity, 4(1), 1-10.
Call for papers: [Link]

 

JOURNAL PUBLICATIONS

Ruggeri, A. & Vieta, M. (2015). Argentina’s worker-recuperated enterprises, 2010-2013: A synthesis of recent empirical findings. Journal of Entrepreneurial and Organizational Diversity, 4(1) (accepted and forthcoming).

Vieta, M. (2014). The stream of self-determination and autogestión: Prefiguring alternative economic realities. Ephemera: Theory and Politics in Organization, 14(4), 781-809. [Link]

Vieta, M. (2014). Learning in struggle: Argentina’s new worker cooperatives as transformative learning organizations. Relations Industrielles/Industrial Relations, 69(1), 186-218. [Link]

Vieta, M. (2013). Recuperating a workplace, creating a community space: The story of Cooperativa Chilavert Artes Gráficas. Scapegoat: Architecture, Landscape, Political Economy, 4, 160-178. [Link]

 

BOOK CHAPTERS

Giovannini, M. & Vieta, M. (2015). Cooperatives in Latin America. In J. Michie, J. Blassi, & C. Borzaga (Eds.), Handbook of cooperative and mutual businesses. Oxford: Oxford University Press (accepted and forthcoming).

Vieta, M. (2015). Autogestión: Prefigurando el nuevo cooperativismo y el trabajo como un bien común. In C. Pacheco & M. Gómez (Eds.), Construyendo desde la economía de los trabajadores. Mexico City: Universidad Autónoma Metropolitana (accepted and forthcoming).

Vieta, M. & Depedri, S. (2015). La nascita delle cooperative di lavoro da processi di workers’ buyouts: diffusione e caratteristiche del fenomeno in Italia. In C. Borzaga (Ed.), Rapporto sulle cooperative italiane: 3o rapporto da Euricse. Trento, Italy: European Research Institute on Cooperative and Social Enterprises (in press).

Vieta, M. (2015). Workers’ buyout. In A. Bernardi & S. Monni (Eds.), Cooperative enterprises: Key words. Rome: Roma Tre University Press (in press).

Reprint in Italian as: Vieta, M. (2015). Workers’ buyout. In Bernardi & S. Monni (Eds.), Impresa cooperative: Parole chiave. Rome: Il Mulino (in press).

Vieta, M., Quarter, J., Spear, R., & Moskovskaya, A. (2015). Worker co-operatives as participatory organizations. In D. Horton Smith, C. Rochester, & R.A. Stebbins (Eds.), Palgrave handbook on volunteering and non-profit associations. Houndmills, Basingstoke, UK: Palgrave Macmillan (in press).

Vieta, M. (2015). Autogestión: Prefiguring the “new cooperativism” and “the labour commons.” In DuRand, C. & Stone, B. (Eds.), Moving beyond capitalism. Winnipeg / Farnham, UK : Fernwood / Ashgate (in press).

Vieta, M. (2014). Saving more than jobs: Transforming workers, businesses, and communities through Argentina’s worker-recuperated enterprises. In Social and solidarity economy: Towards inclusive and sustainable development (pp. 5-34). Geneva: International Labour Organization (ILO). [Link]

Atzeni, M. & Vieta, M. (2014). Between class and the market: Self-management in theory and in the practice of worker-recuperated enterprises in Argentina. In M. Parker, G. Cheney, V. Fournier, & C. Land (Eds.), The Routledge companion to alternative organization (pp. 47-63). London: Routledge.

Vieta, M. (2012). From managed employees to self-managed workers: The transformations of labour at Argentina’s worker-recuperated enterprises. In M. Atzeni (Ed.), Alternative work organization (pp. 129-157). Houndmills, Basingstoke, UK: Palgrave Macmillan.

Askew, K.  & Vieta, M. (2012). From nothing to the fastest growing medical clinic in the province: Cooperativa de Trabajo Salud Junín. Featured story for www.stories.coop and the book Building a better world: 100 stories of co-operation. ICA 2012. International Cooperative Alliance and European Research Institute on Cooperative and Social Enterprises initiative (Mar. 21). [Link]

Askew, K. & Vieta, M. (2012). Argentinean workers take destiny into their own hands: Unión Solidaria de Trabajadores. A featured story for www.stories.coop and the book Building a better world: 100 stories of co-operation. ICA 2012. International Cooperative Alliance and European Research Institute on Cooperative and Social Enterprises initiative (Mar. 1). [Link]

Askew, K. & Vieta, M. (2012). Artes Gráficas Chilavert. A featured story for www.stories.coop and the book Building a better world: 100 stories of co-operation. ICA 2012. International Cooperative Alliance and European Research Institute on Cooperative and Social Enterprises initiative (Feb. 14). [Link]

 


 

This project is part of the line of research into New cooperative forms and new roles for cooperation in the Italian and international context.

Over the years, cooperative and social enterprises have taken on different roles and forms, and interest in the potential of these entrepreneurial forms is increasing, especially in regards to certain sectors (such as social services and general interest) and the ability to tackle employment problems and competitiveness in SMEs in particular.

These new forms of enterprise are, however, often defined in an approximate way, partly due to a lack of specific regulation. The development of research aimed at understanding emerging cooperative and social entrepreneurship forms is therefore of particular relevance.

The other research projects carried out by Euricse, in reference primarily to the Italian and European context, are:

Social and community enterprises and cooperatives
New evolutions and regulation of worker cooperatives;
The evolution of the role of agricultural cooperatives

 

Partners

University of Trento
University of Toronto
CFI
Confcooperative Italia
Centro Studi Lega Coop Bologna
International Study Group on Utility Cooperatives