Worker Cooperatives

A worker cooperative is a company owned and controlled by—and for the benefit of—the people who work there. The Board of Directors comprises a majority of employee-owners who are elected by the full membership on a one-person, one-vote basis, and net profits are shared, based on a formula designed to suit the company.

Worker coops have lower setup and ongoing administration costs and may qualify for some tax benefits. For example, in some circumstances, the seller can be eligible for lifetime deferral of capital gains tax, and the profit that is paid out as patronage is tax-deductible to the worker cooperative business.

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Worker cooperatives


One person, one vote among employees, to elect board members and vote on major strategic decisions defined in the bylaws. Employee-owners also make up the majority of the board

Tax positive

Profits shared as patronage are tax-deductible to the business; also, some sellers may qualify for lifetime deferral of capital gains tax


Employee-owners earn profit-sharing via patronage, based on hours worked

Less expensive

Lower set up and ongoing administration costs

Equity stake

Employees usually pay a modest equity buy-in


Appropriate for companies of all sizes

Coops are a popular choice because of the many benefits, the lower setup cost and the full range of democratic values.

Learn how becoming a coop helped Happy Earth Cleaning further live their values.  

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Project Equity can help your business create a culture of ownership.


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Get our free e-book for a deeper dive into the three forms of employee ownership