What can the nation’s largest employers learn from a worker co-op?

More than you might think — and it can improve your bottom line

By Alison Schmitt and Laura Roberts

In this year like no other, people across American society have been questioning traditional power structures and reexamining who has solutions to some of our nation’s toughest problems. For corporate leaders, confronting a devastating pandemic and deep-rooted racial injustice, your usual M.O. is likely proving inadequate.

In the past, you’ve looked to the leader of your company — or, if you’re a CEO yourself, to your board or your peers on the Fortune 500 list — for wisdom to resolve knotty issues. In unprecedented times such as these, the answers you’ll find there will be limited.

Corporate leaders should start looking to workers for guidance

It’s time for a fresh approach: What would it mean if you considered that the people who work for you might have more insight than the people you work for or work with? You’ll be surprised at the business value you can unlock. To access this insight, you need to find new, expansive ways to empower frontline and entry-level workers to speak up — and hear what they have to say.

Over the past six months, we’ve explored what that could look like within the walls of a business. We started by asking what having a “voice” means to workers who have not traditionally been involved in decision making and what issues are most important to them. Together with Turning Basin Labs, a worker cooperative staffing agency in the San Francisco Bay Area, we conducted a participatory research project to examine the on-the-job experiences of workers across the region and how to improve them.

Many insights emerged. But one highlight was the distinct way that workers defined job quality. Rather than focusing solely on wages and benefits, they identified two other things: ownership and autonomy on the job.

Workers explained they want to share in material ownership of business assets as well as to have psychological ownership of what they do — the feeling that their work and its value belongs to them. Workers also want the flexibility and agency, or autonomy, to take actions that benefit both their career progression and the company’s bottom line.

Many things can stand in the way. Workers told us that “being policed” at work — experiencing excessive control, from dress codes and micromanagement to racial and gender discrimination — detracts from a sense of ownership. By contrast, workers who shared in financial ownership of their company described the opposite — a feeling of being empowered and invested in their company and its results.

The COVID-19 pandemic has highlighted the broad spectrum of challenges workers face on a daily basis and exacerbated many, such as access to reliable transportation and child care. Workers reported their wish to see employers commit to helping them address such challenges, individually and collectively. This type of support can be crucial in enabling workers to overcome obstacles and, ultimately, improves their well-being, which increases their sense of agency and boosts productivity, as well.

When workers are heard, they help businesses soar

Corporate leaders like you may be thinking that investments in worker ownership and autonomy are expensive and resource intensive.

Fortunately, data show this type of employee investment is good for the bottom line. According to research from Rutgers University, companies that offer benefits such as equity compensation and profit sharing have a dramatically lower voluntary turnover rate — by half — and a higher return on equity than their peers. And other research has documented that engaged employees — those who feel they have a say at work — are more innovative and productive and have lower rates of absenteeism than those reporting lower levels of engagement.

One note of caution though: if inauthentic, efforts to empower workers can actually harm them and negatively affect a company’s bottom line. Examples can range from the seemingly innocuous, such as town hall meetings or suggestion boxes that get no follow through, to the more pernicious, such as employee surveys that are used to identify likely union organizers.

We’d like to help you ensure your efforts are authentic, strategic, and lead to benefits for both workers and the business.

Here’s how you can get started

Building on our worker-led research findings and JFF’s Impact Employer Framework, (which identifies worker-focused corporate talent practices across six key areas), we pulled together an initial set of practices that corporate leaders like yourselves can adopt to create a greater sense of ownership and autonomy for workers and improve the overall quality of their jobs.

Here’s a sample list:

Enable workers to direct their own learning and development so they can determine their own career pathways. Consider: How can workers align their interests to pathways within the company?
Design opportunities for workers to reskill in order to move up — or across roles or functions — within your business. Consider: How can you redeploy incumbent workers to support both their growth and the company’s success?
Foster ongoing open dialogue and trust building between workers and management. Consider: How can you create a workplace where everyone feels included and comfortable having open, honest conversations about subjects such as anti-racism and unconscious bias across the company?
Pilot worker-led research and development projects. Consider: How can workers drive innovative research projects to develop new products, solve corporate problems, and build entrepreneurial skills, confidence, and engagement?
Get creative around the idea of ownership. Consider: How can you introduce new policies, such as stock ownership options, that will allow workers to have a tangible stake in the success of the company?

Our journey is just beginning

In the coming weeks and months, JFF will continue to test and refine how these principles can be applied in all types of companies both locally, through our regional work in California, and at the national level through our Corporate Action Platform. Our hope is that we can write a road map to broader adoption of worker-friendly practices across companies — and spur investment in such practices.

Here’s what we collectively need to make that happen:

More evidence collected and shared by employers who are adopting policies that serve to increase worker ownership and autonomy. Data and case studies will help “make the case” to other companies whose leaders are not yet convinced this is the right path forward.
Informal and formal communities of practice for companies large and small that are embarking on this journey of increasing the ownership and autonomy of their workers. We know that companies working together often go further, faster.
Stories from workers themselves that help elevate the impact of these types of practices. Our initial work with Turning Basin Labs was a fantastic first step in this direction, but there are many more voices to bring forward that can help this work accelerate.

Such efforts to advance solutions that are both market-driven and worker-driven to boost innovation, retention, and productivity will require investment to catalyze dialogues and design models that build new bridges between workers and corporations. JFF and Turning Basin Labs are seeking support from corporations and philanthropy for our next phase of work to make progress along these lines. We invite you to partner with us.

If your organization is interested in partnering with JFF and Turning Basin Labs on this initiative or if you have any questions, please contact Alison Schmitt, Associate Director, JFF, or Laura Roberts, Director, JFF.