An Introduction to Co-Determination: Putting Worker Representatives on Company Boards
A proven means to give workers control over their workplaces and their lives.
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At its core, Socialism is the extension of democracy into the economy. Just as we want every American to have their political voice heard through participation in democratic political elections, Socialists want the working class to have a say in how their workplaces operate through economic democracy. There are many ways to structure economic democracy (worker cooperatives, the nationalization of corporations and heavy industry, etc.), but the most easily-obtainable structure is the union. When workers unionize, they come together to bargain collectively with their employer, establishing some degree of economic democracy. If their demands aren’t meant, they will withhold their labor by going on strike.
And while unions are proven to win higher pay and better benefits for their members, their position (at least in the U.S.) is limited to worker contract negotiations, not actual decision-making power in the corporate ladder. But, that does not need to be the case. In other countries, unions don’t only serve as bargainers for their members but have earned seats at the board table, giving the rank-and-file membership a voice in the high-level decision-making of their workplace. Known as co-determination, this well-establish practice of worker representatives sitting on board seats is a fantastic goal for the American labor movement to strive for.
Though it is uncommon in the U.S., co-determination is alive and well in more labor-friendly countries. Austria’s Labor Constitution Act of 1975 established that private companies with over 300 employees must give 33% of board seats to worker representatives. In Germany, companies with over 500 employees must give workers 33% of board seats, while companies with over 2000 employees must give workers half of all voting seats. Many other European countries have similar laws designed to ensure boards, and the decisions they make, aren’t able to steamroll their workers in their quest for limitless profit.
In the United States, co-determination experienced a glimmer of popularity during the 2020 Presidential campaign, when then-candidate Elizabeth Warren put forth a policy plan that would require 40% of company board seats be given to worker representatives. And while Warren’s proposal went down with the demise of her candidacy, her idea for co-determination would work quite well in the U.S.
How Co-Determination Would Work in the U.S.
According to the Bureau of Labor Statistics (BLS), the plurality of Americans work for a business with over 1,000 employees. This makes the U.S. a prime environment for co-determination, as larger businesses are traditionally run by boards of directors that worker representatives can be seated on, rather than small sole proprietorships. The breakdown of employment in the U.S. workforce by company size can be seen the below chart.
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