Study Overview
Workers in low-wage sectors such as agriculture and allied healthcare face challenges such as labor shortages and high turnover. At the same time, a small number of staffing agencies dominate each sector and continue to generate substantial profits while labor violations continue to persist despite attempts at regulation and penalties. This paper presents two case studies of worker-owned labor contractors: California Harvesters, Inc. (CHI), a farm labor contractor with an employee-owned trust, and AlliedUP, a healthcare staffing cooperative.
Study Results
Both face similar challenges: securing market share (securing long-term clients and recruiting talented workers), managing tight business margins in competitive sectors, and engaging a supportive ecosystem of partners. While both organizations are relatively new, having launched within the last five years, their capacity for leveraging worker voice and decision-making in their respective ownership and governance models remains slow to come online as both are prioritizing stabilizing their business operations. Despite these challenges, both have demonstrated success; CHI has ensured good working conditions for workers even though pay is still at the $16 minimum wage rate, and AlliedUP increased wages for some workers but has only 15 members as of 2023. The findings of this case study suggest that improving job quality through worker-owned labor contracting in competitive, low-wage sectors with tight labor markets has clear advantages but major challenges. Overcoming these challenges may gain from business assistance with securing clients and workforce partnerships to recruit workers, but more targeted support may be necessary to enable success
Intervention: Employee ownership models
Research Partner: Institute for the Study of Employee Ownership and Profit Sharing
Populations: Low-wage workers
IBSI Funding Acknowledgement: Ownership Initiative
News & media
The Promote Ownership by Workers for Economic Recovery Act (AB 2849) Panel
June 13, 2023
The Promote Ownership by Workers for Economic Recovery Act (AB 2849), codified in Labor Code sections 10000-10010) establishes a panel to study the creation of an Association of Cooperative Labor Contractors, among other potential activities, to facilitate the growth of democratically-run high-road cooperative labor contractors.