What is Workplace Democracy?

Workplace democracy is generally understood as the application of democratic practices, such as voting, debate and participatory decision-making systems, to the workplace.

There are many ways to do this, some much more ambitious than others. At one extreme lie small firms and non-profits that have embraced pure, direct democracy. This is unwieldy in any but the smallest firms, since more time would be spent deciding than doing. At the other extreme lie firms where executives follow recent management fads and exhort employees to “feel like owners,” but then do very little else.

In the middle we find firms where the processes of workplace democracy aid the success of the business. The best examples have been distilled into what a noted expert calls the “equity model” of employee ownership (Rosen et al.). A key part of this approach is the relationship between participatory management and employee stock ownership. According to a recent summary, “the combination of ownership and participatory management is a powerful competitive tool. Neither ownership nor participation alone, however, accomplish very much.” (http://www.nceo.org/library/corpperf.html).

What is employee ownership? It simply means that the people who work for a company own some or all of it. Among the kinds of employee ownership (partnership, cooperative, etc.), the most common method of ownership is the employee stock ownership plan (ESOP) , through which employees own shares in their company.

Use the resources to the right to answer the following questions:

  • How widespread is participatory employee ownership (“the equity model”) in the U.S.?
  • Why is it not more common?

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