US Steelworkers embrace worker-owned cooperatives

In 2009, the US Steel Workers (USW) announced it was forming an alliance with the Mon­­dragon Cooperatives. This collaboration would bring together the strength and organization of the union and the workplace democracy and employee ownership of a worker co-op.

On a recent trip to the Eastern Conference for Workplace Democracy, I was able to see first-hand how this relationship could work. The first day of the conference in Baltimore started with tours of local worker cooperatives and employee-owned businesses. The very first business we toured was the “Maryland Brush Company,” and that was all it took to convince me how beneficial this new collaboration could be.

The Maryland Brush Company actually opened for business way back in 1851 as a manufacturer of paint and industrial steel brushes. The company was acquired by PPG in 1901 and continued to do business in the same industries into the mid 1980s. At that time – the age of shipping our manufacturing to other countries – the parent company decided to close the plant in Baltimore and move the paint manufacturing out of the country. The industrial brush division was deemed “not profitable enough” and was just going to be closed. All 400 workers were going to lose their jobs.

This is when the US Steel Workers Union steps in. Everyone that worked for the industrial brush side of the business was a member of the union. Obviously, the USW did not want to see these people lose their jobs.

The USW worked with the management at PPG to allow the employees of the Maryland Brush Company to buy out the industrial brush portion of the business. This was not an easy task – it wasn’t just jobs, it involved equipment, several big buildings, patent rights, etc… More importantly, where could a group of union members get the capital to finance this whole adventure?

Again, the USW stepped in. The union came up with a plan to allow the union members to either borrow against their pensions or buy out their pensions to purchase stock for the new company.

The Maryland Brush Company is now an ESOP that functions very similar to a worker coopera­tive. Decisions are made democratically, and the employees own the business. The company is known for its quality and has a strong position in the marketplace.

That brings us up to the day – just before Labor Day – the US Steel Workers passed Resolution No. 27 at their 2011 convention. This resolution is almost completely written for their new effort towards worker ownership. You should read this document if you have any interest at all in the development of a new economy using worker cooperatives. Although we can’t reprint the entire resolution, we would be remiss if we didn’t at least highlight the last paragraph of the document:

(Excerpt from USW Resolution No. 27)

Workers’ Capital, Industrial Democracy and Worker Ownership

(4) Our Union will continue to promote and develop unionized, worker-owned cooperatives, as well as other forms of worker-ownership, as a profitable and sustainable means to create jobs and invest in our communities.

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