How can workers tap into their own power and voice?
How can organizations promote worker democracy? Learn how worker-ownership can help solve social problems and ways to share leadership with your team and community. Farra Trompeter, co-director, and Esteban Kelly, executive director at the US Federation of Worker Cooperatives (USFWC) and worker-owner and co-founder of Anti-Oppression Resource and Training Alliance (AORTA), chat about these topics and more in this episode of the Smart Communications Podcast.
Farra Trompeter: Welcome to the Smart Communications podcast. This is Farra Trompeter, co-director and member-owner of Big Duck. And if you’re not sure what that title member-owner means or worker-owner, well, that’s what we’re gonna talk about today. I am delighted to be joined by Esteban Kelly, and we’re gonna talk all about how can workers tap into their own power and voice. Esteban is the executive director of the US Federation of Worker Cooperatives (USFWC), and is a worker-owner and co-founder of AORTA, Anti-Oppression Resource and Training Alliance, a worker co-op that builds capacity for social justice projects through intersectional training and consulting. Esteban has served as a board member and advisor to dozens of organizations and received a Social Innovation Award for public policy in 2018. An internationalist rooted in Philadelphia, Esteban infuses popular education, systemic thinking, and anti-oppression analysis into all of his local organizing and advocacy work. Esteban, welcome to the show.
Esteban Kelly: Thank you so much. I’m so happy to be here.
Farra Trompeter: Well, as you out there may know, and I know as Esteban knows, Big Duck transitioned from a single founder-led and owned into a worker-owned cooperative in November 2021. And I have found in the course of explaining to people that now I work for a worker-owned cooperative, and I am in fact, one of 14 owners, a lot of people actually aren’t familiar with co-ops or maybe they have associations with their local food co-op or their daycare center. And I just would love it if we can just start off by explaining what co-ops are? Maybe you could talk a little bit about the structure and model, the differences between consumer co-ops and worker co-ops? So just teach us all about co-op Estaban.
Esteban Kelly: I can teach you some about co-ops. I don’t know.
Farra Trompeter: All right. Just a minute or two.
Esteban Kelly: So co-ops fundamentally are a business model where everyone who is meant to benefit from a set of services of the cooperative are the members that’s the member class. So it’s not so much about being an investor or being some other sort of class where you’re not directly involved in either the production or the services or whatever it is that the co-op is producing. And so when you talk about food co-ops, grocery food coops, that’s an example of almost all of them in this country, not all of them, but most of them are consumer-owned, which means that the workers who are there, whether they’re management, whether they’re rank and file staff, they’re not necessarily members of that co-op, some of them might be, but if they are, their members as consumer members, meaning just the people who shop there. And it’s gonna weave in the different incentives and the member benefits based on that purpose.
Esteban Kelly: So that might be about the product mix. You carry special goods, that might be about affordable prices, that might be about quality control of the kinds of goods that you’re stocking, or things about accessibility or other kinds of programs, you know, cooperative, education, food, justice, food education, nutrition, things like that. Whereas a worker co-op and we have about a dozen of my members that are running grocery co-ops, it’s different where you might still shop there, but you’re not shopping there as a member. The members of a worker-owned grocery store are the people who work there. And that doesn’t matter whether your status is a general manager, a bookkeeper, somebody who’s in the buying, or the grocery produce department, or a cashier, everyone there is an owner. And regardless of which kind of co-op, you are all members. Members have the same set of rights and powers. So you have one share per member. One member, one vote.
Esteban Kelly: So it doesn’t have that disproportionality that sometimes comes with other kinds of business models, where if there’s a founder or an investor, they might have majority control or majority shares. It’s not set up that way. Beyond all of that, it doesn’t necessarily imply anything about the management structure, which could be any number of things. So you can absolutely have a hierarchy or a general manager and shift managers. But when it comes down to voting, choosing who’s on the board, fundamental decisions for the cooperative overall, it does come down to one member, one vote.
Farra Trompeter: That’s great. And it’s funny, you just mentioned board and now I’ve been at Big Duck for 15 years. The company is almost 30 years old. We are a for-profit business, but since we’ve become a co-op, we now have a board. So not only do we deal with boards with our clients who are nonprofits, but we have our own board. And that’s been interesting to sort of factor that into how we operate in our decision-making. So here’s to boards… The joy and the pain.
Farra Trompeter: I think one of the things that was really attractive to us as we were thinking about options. When we knew it was time to transition, and Sarah Durham, our founder was ready for the next phase of her life. And then, and you know, she is on our board actually, and is still very involved in helping us think about who Big Duck is as we grow into the future. One of the things that we were excited about with the idea of the co-op model was that you know, worker ownership really does seem like a great solution and a powerful engine to build assets. For many people who don’t typically have access to intergenerational wealth, it felt really aligned with our values of power-sharing and questioning traditional structures as well. And I’m just curious how you see worker-ownership as a solution to social problems and the way it can help expand democracy?
Esteban Kelly: Yeah, there’s two pieces. I mean, so for co-ops generally, and I should say that even if they land as a marginal or alternative model for a lot of your audience, it actually is a really well-established cornerstone of our economy. So a lot of the agriculture, not just in the United States, but around the world is produced by farmer cooperatives or distribution or shared marketing cooperatives. A lot of credit unions, basically they are financial cooperatives that have a mission about banking, the unbanked, or providing financial services to communities in need. And just for example, in this country, there’s over a hundred million members of credit unions. That’s significant. That’s like one out of every three Americans is a member of a co-op and most of them might not even realize that.
Esteban Kelly: And around the world, cooperatives together are organized under a group called the International Cooperative Alliance, which is almost like the UN for all the cooperative associations and businesses in the world. It actually is the largest nonprofit in the world. They have over a billion members. When you factor in everyone who is banking in credit unions, everyone who’s doing dairy production, agriculture, housing cooperatives, healthcare cooperatives, and certainly worker-owned cooperatives as well are part of that. So it actually is massively significant in terms of the grassroots, the size, and the scale, the economic impact on the GDP. And then when you get to the sort of shared values that define what it means to be a co-op where all structured under seven cooperative principles. They include things like cooperative education, economic, member economic participation, open membership, so as long as your criteria is clear to anyone that they’re able to vote, and you can’t just say, no, you can’t be a member of this co-op just cuz we don’t like you, you know, like your credit union, they have to sort of let you, as long as you fit into their neighborhood or their zip codes or whatever their criteria are.
Esteban Kelly: And so those things, you know, concern for community cooperation among cooperatives, their seven co-op principles that we all share, and that defines us as co-ops. And they’re sort of matched by a set of co-op values that include things like democracy, equity, solidarity self-help. And so all of those things are reflected in various ways, depending on like how cooperative and in particular co-op is. And I will say, it’s not just because I work for the Worker Co-Op Federation. I’ve been a member of a lot of different kinds of co-ops, but worker co-ops, I would say are in some ways the best expression of those values, that they take them very seriously, very literally. And you feel it day-to-day, which makes sense because it’s your livelihood. It’s your place of work and not just one out of the many you might shop or spend money or get your electricity from or some of the other kinds of cooperative models, then you bring that culture to your day-to-day, you know, really is about your workplace, so people feel that.
Esteban Kelly: And when we think about building out the field and what the prospects are for building a better world and transforming our economy, expanding economic democracy, especially through the worker co-op model, that’s when I think people’s eyes really start to light up. We have fascinating conversations with donors, people at foundations, certainly elected officials and policymakers, people who do workforce development because the prospects for addressing things like the racial wealth gap, for providing economic infrastructure and solutions for people to meet their own needs in their communities, by developing assets, right? You can turn workers into asset holders, there’s all kinds of statistics about how much more challenging in the 21st century it’s been for Americans to have access to asset building, whether that’s through home-ownership or other kinds of wealth building, but worker-ownership is one of the best, most accessible ways for somebody to actually own a piece of something that becomes an asset.
Esteban Kelly: You can convert a traditional business into being a worker-owned one without necessarily needing to start a new one. You could start a new business or you can incubate a project. A lot of our nonprofit partner organizations do that. That’s one of their models is if they’re trying to, for example, create better economic livelihoods for immigrant women, they could run a bunch of programs or try to find the need to distribute funds directly or run programs. But increasingly over the last 10 or 20 years, they’ve started seeing that they can actually help to build a cooperative business and have that be an engine for their own livelihoods, for leadership development, financial literacy, asset development, for building the stabilized, seeing the family wealth in those households. And those all become things that improve, not just the lives of those individuals, but the health and well-being for their families and their communities more broadly.
Farra Trompeter: That’s great. I’m gonna pick up on two things you just said. One is that the principles and values of cooperatives are really powerful. We’ll link to those and the transcript. If you’re listening to this and you wanna get links and access to all the information, all the knowledge that Esteban is dropping come to bigduck.com/insights, and you’ll find the transcript for this podcast. And we’ll be sure to link to all of that. I wanna also pick up on something you were saying a few minutes ago about programs within nonprofits, because one of the things that we’ve gotten a lot of questions about when we’ve held some Open Houses when we first announced that we became a cooperative and we hold them every few months, we get oftentimes agencies who are excited by this model, which is great. We’re happy to spur this within the agency world, but also nonprofits who say, well, okay, I’m understanding cooperatives. I get how this works for a “business”, how does this work for nonprofits? Where does the cooperative business model and the nonprofit, I guess traditional 501(c)(3), or social impact, how do nonprofits participate in the co-op process and in particular with the idea of promoting worker democracy?
Esteban Kelly: Yeah, it’s interesting. I get a lot of questions about this sort of intersection and interplay between worker co-ops themselves, and nonprofits who regardless of their mission, a lot of it often comes down to issues of either social or economic problems that they’re trying to address, which could include anything from climate to gender, to food systems. And some of it could be just around mission. Like I was starting to say, nonprofits might try to address some of those bigger problems by engaging with cooperative development. So when I mentioned the racial wealth gap, for example, there was a recent study that came out that found if 30% of every US business were owned by its workers, the median wealth of black households would increase from just $24,000 to $106,000. So the average wealth of the bottom 20% of households in the United States would quadruple generally across racial categories.
Esteban Kelly: So it just sort of shows how powerful that model is. And for businesses, for cooperative businesses, the benefits of actually being able to take the surplus, what a traditional business would call profit, and reinvest it either in the business or redistribute those profits equally to the members, equally based on the hours worked or things like that, not based on their rank or status in a hierarchical worker co-op, is really clear that there’s that economic benefit. But on the other side of it, it is these cultural things that you’re talking about. And certainly, in the 21st Century, we see for younger workforces, for groups who share kind of a feminist politics, certainly ones around addressing racial justice inside of the workplace and working conditions in different industries, that all of those things about what we call workplace democracy end up being the part that matter.
Esteban Kelly: And sometimes in some ways more so than the economic benefits. And those are things that do translate into nonprofits, even if they’re publicly owned 501(c)(3) nonprofit organizations. And so there have been a lot of initiatives, we’ve been doing work with our sister nonprofit affiliate, The Democracy at Work Institute, around converting nonprofits to a worker self-directed nonprofit model. And that’s basically turning the staff of these nonprofits, who are stewards of a mission, not into owners, but to really unlock their agency and their buy-in to be able to shape the conditions of their workplace. That can be input, or design, or even votes about personnel policies, salary structures, sabbatical policies, health leave. My staff just had a deliberative process to create a COVID policy. And of course, those of us in management had to balance that with the liability of the organization. And I think what’s different or particular about nonprofits is that remains true.
Esteban Kelly: And that’s crystal clear like you can’t mess around with the fiduciary responsibilities that the board and executive leadership hold, but it creates a lot more space to put that in conversation with everyday workers who after all are putting tens of hours per week of their energy, their labor, their life force into participating in a workplace. So they ought to be able to design what it looks like and have their voice matter, whether for policies internally, or things like open-book management and financial transparency so that more of the workers have a sense of what’s with the funds, the grants, the programs, how the priorities of the organization are expressed through financial decisions that are being made and connecting the dots between financial management and policies and the kinds of day-to-day questions that come up. That the more transparency and closed loops around feedback, that there then helps with retention. The happier workers are, but also it becomes more efficient in the long run for how things are designed.
Esteban Kelly: So there’s ways of setting that up. Some nonprofits create a membership category, and obviously, that membership wouldn’t be about owning pieces of the (c)(3), which after all is public or charitable in some way. But membership in the organization itself, which gives you maybe rights, you might set up a charter of what things you could vote on. Many workers, self-directed nonprofits have a pathway for workers to appoint, or elect, or designate someone from the staff to sit on the board. In addition to usually the ex-officio staff, like a CEO or an executive director, and they often will have things like an annual meeting or quarterly meetings that aren’t staff meetings. It’s membership meetings, it’s meetings about them as these stakeholders of workers inside of the workplace. And I think we’re pretty early, still experimenting with this model but learning a lot from the groups who are already starting to play with what that looks like in terms of organizational governance and committees and leadership development and things like that.
Farra Trompeter: And I suspect there’s a whole world we can go down with unions, but we’re gonna stay focused on this for a moment. I think this idea of being a worker self-directed nonprofit if your organization decides to become that, or even if it does. I mean, I think one of the things that’s really exciting about the work is that I know the organizations you’re a part of do and that I think you all help promote are the ideas of things like collective governance, power-sharing, deep democratization. So I don’t know if those principles only apply to becoming a worker co-op or a self-directed nonprofit or that can apply to anybody. If I work for an organization and I wanna bring these things up, where do I start? Where are examples of what it looks like?
Esteban Kelly: Well, one great place to start would be with our sister nonprofit, that I was mentioning The Democracy at Work Institute. Their website is institute.coop, C O O P, no hyphen on that, or with the Sustainable Economies Law Center. They have a lot of resources on their website. It’s kind of linked through their homepage, about what it looks like to either convert your workplace to being democratically run, or even just in terms of management, to start to weave in practices for things like open-book management, and things like peer evaluations, and leadership development, coaching, different kinds of policies for workplaces. There’s also, I think some case studies and examples of structures that work inside of nonprofits. So those would be good places to start. We certainly have information on our website as well, usworker.coop, C O O P, and we are constantly running programming, there’s webinars, things that we record and either push out through our newsletters, or post on social media, or even some of those webinars are published on our YouTube channel.
Esteban Kelly: And there actually is a whole network of nonprofits who are experimenting with these sort of models. Nonprofit Democracy Network, there’s a Workers to Owners Collaborative, of mostly (c)(3) nonprofits who do worker ownership, organizing, or worker co-op development. And any of those organizations are also good places to start to look to for models. Lastly, I actually worked on a project just as a consultant, because this is part of what we do, is support with actual projects with a small regional foundation. And they decided they wanted to become a worker self-directed nonprofit. And so we worked with them to help design their governance structures, which is where a lot of the details really live. Since it’s not about things like shares and patronage, distribution, and bylaws that say, you know, what are your profit-sharing mechanisms? But it’s more like, what does it mean to have advisors?
Esteban Kelly: And what does it mean to actually take some of our general expectations of what a board member would do and delegate that to staff. Lean more on staff to shape more of the direction that we’re going programmatically, or even in terms of priorities. And the board becomes more of an advisor. They still do hold some fiduciary power, but they might be sitting as a member of various committees or circles on their areas of expertise or to lend connections and perspectives. So that might be for a finance committee or for the different kinds of programs. I think it really would depend on the sort of work that you’re doing up to and including things like a personnel committee. That’s a model that I’ve seen more where the nonprofit has dispensed with having an executive director and moved to a shared leadership model. Even if there’s still a leadership team or a smaller group of managers or director-level staff. But if it can work, work in a foundation, it can certainly work in a C3 nonprofit.
Farra Trompeter: We can have a whole other conversation at some point about boards. I have a lot of feelings. I have been on boards. I’m now on Big Duck’s board, as I said, I’ve seen boards at work in a lot of different ways. When they don’t work well, it often feels like there is that power hierarchy. It is very top-down. Board members are trying to exercise power and control when they’re in, not in the day-to-day of the work. And that can be very challenging if you work for an organization. But as you were talking, I was just imagining the idea of having the board be more of an advisor, more of a partner. And especially if you have staff on that board, then it becomes a lot more guiding the organization, which is if we have to have a board, I think more in the best-case scenario. So just thinking about that as you were talking.
Esteban Kelly: Yeah.
Farra Trompeter: Well, as a newer co-op I know that at Big Duck, many of us are members of the US Federation Slack channel. We have been following your webinars and looking at a lot of other resources from you all, and they’ve been very helpful. Thank you. I wanna also talk about the other co-op you are part of and help start, which is AORTA. Our team has really loved AORTA’s resources for hiring in particular. They’ve been really helpful in getting us to challenge our own biases and practices around recruitment and interviewing, and we are huge fans. And I was just curious, I’d love to help get the word out about AORTA in case people aren’t familiar. So maybe you can talk a little bit about what’s AORTA up to these days? How can people access their services? I love that AORTA describes their services as heart-centered. The AORTA website is aorta.coop. Again, we’ll link to all of the things we’ve been saying in the show notes, but yeah. Can you talk a little bit about AORTA and what it’s up to?
Esteban Kelly: Absolutely. Yeah, so I obviously split my time between the two organizations, which sometimes feels stretched, but actually a lot of times there’s a fair amount of efficiency that comes from that. So for example, I was able to take our antiracist hiring toolkit resource that we developed in AORTA, and I delivered that at Worker Co-op Conference that we organized for the Federation, knowing that so many of our members, again, not just the cooperatives, but the nonprofits as well would find a resource like that useful. And it wasn’t rocket science. I mean, I really just did like a deep, a rich unpacking of what that resource was to sort of guide people through it. And that’s a resource that is on, I think our YouTube channel and on our website that collects a lot of the webinars we’ve had inside of our conferences for the Worker Co-op Federation, which is just conference.coop, is often where some of those webinars and workshops and panels are stored.
Esteban Kelly: And we do those in both English and Spanish on the worker coop side for AORTA, speaking of things like language access and us, this we’ve been doing a lot of work around disability justice, and really just trying to expand our pedagogy with a pivot to virtual training that we’re able to offer things that are more accessible. So working with captioners, people who are doing sign language on video, on Zoom. There’s a whole host of what it means to facilitate virtually in a more accessible format. That’s one of the adaptations that we’ve been doing about how we do what we do and not just what we do directly. We unpack that in one of our newer programs, which we’re calling Headwaters. Headwaters is a way of sort of focusing on facilitation in particular as a skill. And of course, AORTA, all of our work is really intersectional and how we approach it.
Esteban Kelly: And so we design it with thinking about this concept of anti-oppressive facilitation. That’s accessible to the point about disability just a moment ago. But really sort of saying, how can we unpack the way we do the things we do? Of how we deliver facilitation effectively for different spaces? So it’s really a training for trainers. It’s for people who have to run meetings, run organizations, run campaigns, or trainings, or deliberative things, community meetings, what, whatever kind of work you’re doing. And so people apply to sit in one of these intensives and it’s usually like you sit down and you’re committing to sitting down for several hours at a time, but we really take our time and we’re chatting on a podcast, so I’m talking at my normal pace, but in a Headwaters training, we go very slow and talk about ways of dealing with principal disagreement in groups, ways of engaging people when you’re dealing with, you know, the silent room, whether that’s in person or on Zoom. When you throw out a question, and really mapping out, like, what are some of the reasons why people might not be you responding? And how do you break down the question into more digestible pieces that people can engage with? Or how do you activate people in the room through things like the chatbox or different prompts or breakouts and things like that?
Esteban Kelly: So we share a lot of those tips and tricks through Headwaters and people can register kind of a la carte, a few times a year we open those up. We’re also training up a bunch of apprentices through Headwater. So these are people who taking that train-the-trainers model and taking that to the next level. These are people who are part of a cohort and they shadow, they go through the trainings with us. And the idea is to have a new crop of leaders who are able to resource our movements for liberation in all the work that they’re doing.
Esteban Kelly: So that’s some exciting stuff. We also were noticing that we had this huge bottleneck of requests to work with nonprofits, especially, but all different kinds of clients that we just kept having to say, no, cause we didn’t have space for it. And so what we did was we decided to design a process called Convergence where organizations could apply to move through some of our standard trainings together instead of individually. So instead of one or two AORTA trainers being invited in to work with your organization, and you having to wait, you know, six months before booking one of us, we just said, how about a bunch of you in your organizations can send a couple people, and we’ll all go through these trainings together. We’ll look at anti-oppression inside of the workplace. We’ll look at some of the common pitfalls that come up about tension, conflict resolution. Some of the workplace policies, like what you were saying about HR and anti-racist hiring. So that’s what we’re doing with Convergence. There’s a lot of stuff we’re up to.
Farra Trompeter: Yeah, you are. You’re definitely busy.
Esteban Kelly: We’re developing a new Whiteness Institute this year, which is not gonna be public probably till next year. We’re sort of taking our time thinking through it. But certainly, if any of your listeners have ideas or recommendations or how-to resources that people who wanna fund that kind of work. This is my colleague, Autumn Brown, one of our worker-owners in AORTA, who’s really taking some time away from regular client work in order to focus on building out this curriculum and this framework that she’s used in the past. Similar to what I was saying about Headwaters and Convergence, to develop this Whiteness Institute. We’re really leaning into our theory of change and updating it, given how drastically the world is changing? What it looks like to meet the moment resource, our movements? Addressing things like climate change. How do we build stronger movements to be more resilient in the face of fascism? And all kinds of problems. So that’s what we’re up to in AORTA land.
Farra Trompeter: That’s amazing. Well, Esteban, thank you so much. I don’t wanna keep you from making the world a better place any longer. So thank you for being on the show. If you’re out there, you’re looking to get resources on how to start a worker cooperative or convert an existing conventional business to a worker-owned or democratic workplace. You can visit the US Federation of Worker Cooperatives at usworker.coop. And again, lots of other resources Esteban mentioned will link to. Esteban, thank you so much for sharing your thoughts, your insights, and helping educate me, let alone everyone listening today.
Esteban Kelly: Pleasure being on here, Farra, and I’m so happy to welcome you into our community of workplace democracy and cooperatives.
Farra Trompeter: Love being here. All right, everyone take care.