The U.S. has a growing understanding of the benefits of employee ownership. Now is the moment to expand policies to support and grow EO businesses across the economy.
Benefits of supportive public policies
Can scale up the EO movement.
Can ensure that marginalized communities have more just and equitable opportunities through employee-owned businesses.
Iowa (House File 2284, 2012). Iowa provides a 50% reduction in Iowa capital gains taxes for business owners selling to an ESOP as long as the ESOP owns at least 30% of the company after the sale. https://www.nceo.org/article/state-legislation-employee-ownership
Nebraska: In 2013, Nebraska amended a 1987 bill (LB 775) that provides Nebraska residents with a one-time capital gains tax exclusion from the sale of stock in an employee-owned company.
City policies
NY: Direct financial support, Space & Infrastructure, Education &Technical Assistance, Preferential City Procurement Policies
Financial Support: Austin (TX), Cleveland (OH), Madison (WI), Minneapolis (MN), Richmond (CA), Richmond (OH), Rochester (VA), Boston (MA), Philadelphia (PA),
See a sample of supportive worker cooperative ordinances and resolutions here. (link to Sustainable Economies Law Center).
Future policy ideas (at the local, regional, and federal levels)
Development of Social Cooperatives: Legislation could be passed to create tax benefits for participating social cooperatives and organizations to support marginalized communities. Social cooperatives are organized to fulfill a public benefit mission, more than to seek profits for owners. See the example of South Korea, Italy, Spain, etc.
Indivisible Reserves: Some countries, such as Italy, Quebec, and Spain, have policies allowing cooperatives to set aside some net earnings, tax-free, for future purposes that support the employee-owned cooperative.
Give workers the Right of First Refusal to purchase the business they work at: A right of first refusal is a contractual right giving its holder the option to transact with the other contracting party before others can. 69% of Americans said YESto providing a right of first refusal for employees so that employees have the first right to purchase the company before the owner sells it to others.
More tax incentives for selling owners: increase tax incentives at the local and federal levels for owners who sell their businesses to their employees.
Preferred Procurement for Cooperatives: Cooperatives need more opportunities to sell their products & services. Cities, states, and the federal government could pass policies granting preferred procurement and contracting rights to employee-owned businesses.