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Can Unions and Cooperatives Join Forces? An Interview With United Steelworkers President Leo Gerard

United Steelworkers President Leo Gerard. (Photo: United Way of the Lower Mainland / Flickr)

Part of the Series

United Steelworkers President Leo Gerard talks to Truthout about the challenges and opportunities of a new labor model: the union co-op.

As the economic crisis festers for many long-term unemployed and underemployed people, the idea of worker-owned and worker-run cooperatives has become ever more appealing as a possible pathway toward an economy that works for everyone. Theorists such as Gar Alperovitz have argued for the importance of cooperatives in providing a nuts-and-bolts alternative to dominant methods of economic production: They offer an example of a different way of doing business that people can see and experience in their own lives.

As someone who loves to see organized labor on the move in any form, I am interested in the role that unions can play in promoting co-ops – and I have been excited to see the United Steelworkers take an especially proactive role in bolstering the cooperative movement. I spoke with Steelworkers President Leo Gerard about how union/co-op hybrids could change the experience of work for those who clock in every day and about the depth of vision it will take to make union co-ops a serious part of the American economy.

Given that cooperatives currently make up only a tiny percentage of our economy, I first asked Gerard whether he thought co-ops could be viable at a larger scale.

“People don’t realize there are millions of people in the United States and Canada that are already members of co-ops,” he said. “When I was a kid growing up in northern Ontario, my parents used to shop at a food co-op. I think that there are already a lot of these businesses; people just don’t know it.”

Gerard next discussed the structure of “union co-ops” that the Steelworkers have begun, in partnership with Spain’s Mondragon cooperatives. Here’s how it works: Employees can join the union of their choice, and they are guaranteed a living wage, benefits and a collective bargaining agreement. In some of the new union co-ops, workers get ownership shares in the enterprise, which they pay for a little at a time out of their paychecks and which accrue equity over a period of six or eight or 10 years. Workers vote on the composition of the management team and collectively bargain with that team to set workers’ wages, benefits, and procedures for handling disputes.

I asked Gerard about how the union’s work with Mondragon came about.

“After the business cycles of corruption and manipulation destroyed so many enterprises since ’07, ’08, ’09,” Gerard said, “we started to have a discussion amongst some of our officers. I had read about the Mondragon a long, long time ago, and we started a dialogue with them. We came to an understanding on what we call the ‘union co-op’ model. We’d use some of the structure of Mondragon and some of their experiences, knowledge and skills. And we’d try to find enterprises [in the US] where we could adapt that.”

“It has evolved slowly,” he continued. “I’d rather go slow and build a good foundation than go fast and fail. We’ve developed a pretty broad network of allies and supporters. We’ve got some projects going on, including a green laundry concept in Pittsburgh. In almost every major city, there are industrial laundries. The work is hard, it’s dangerous, and it doesn’t pay very well.”

The Steelworkers have helped launch a cooperative laundry in Pittsburgh that allows workers to benefit from the profits of the business and that uses environmentally friendly technologies.

“It’s going to have roots. It’s going to have customers. It’s going to have structure,” says Gerard of the Pittsburgh laundry. “We’re talking to universities, hospitals and hotels. They get the advantage of being in a green laundry that’s efficient. They get to be in a progressive organization like a co-op and then build forward.”

I asked about what expansion would look like.

“Once it’s successful,” he said, “we take the model to other cities and try to build a network of green laundries. At the same time as we’re building that network, we would look at the manufacturing of the green laundry equipment. If you’ve ever seen one of the modern green laundries, it reminds me of a steel mill or a paper mill. If you’ve got a modern steel mill or a modern paper mill, you put the raw material in at one end, it comes out at the other end, maybe half a mile later, with .0001 of an inch of deviance, never touched by human hands. [With the laundries,] you put the raw material in, which is sheets and pillows and all that, and it’s an assembly. It comes out at the other end, folded, and piled up and identified for where it’s going to go.”

Gerard says the plan is for the cooperatives to expand from providing the service work at laundries into actually manufacturing the machinery. Moreover, he’s committed to nurturing their development over the long haul: “This wouldn’t happen in six weeks. It might take 10 years to evolve. You’ve got to have a vision.”

I next asked him if industrial laundries were chosen as a target for a cooperative because – unlike traditional manufacturing industries – the jobs can’t be outsourced to other countries.

“I wish I was that smart,” Gerard said. Instead, he emphasized that the choice of targets was based on a more immediate pragmatism: “It’s where the low fruit was. The green laundry idea fits the complete program. You’re doing something for the environment” – by more efficiently using energy than in traditional laundries – “and you’re creating meaningful jobs that can pay decently. If you can take that structure and [replicate] it in different places in the country, you can build the capacity for the cooperatives to come together. That’s my view with this union co-op Mondragon-Steelworker concept,” he said. “Once we show successes, people will say, ‘I want some of that.'”

I asked how cooperatives might affect the experience of going to work for people who work there. Oftentimes, the same deep-seated grievances between workers and management that help drive a unionization campaign can also make it tough for a healthy work environment to form in traditional workplaces, even once workers win a union. I wondered if union co-ops could provide a way for the labor movement to encourage workers to realize their best selves in the workplace and to overcome the difficulties in adversarial situations.

Gerard responded by emphasizing the generally dismal state of labor relations: “The reality in North America is that the management culture that comes out of the business schools, that comes out of the National Chamber of Commerce, makes unions the target. The business community [has] bought into that.” Therefore, if you want to bring your coworkers together in a union, he said, “You have to organize in secret. There are very few places where you’re going to go from an unrepresented workplace and organize right out in the open. You start off in a hostile environment.”

“The statistics are that employers fire people, punish people, isolate people, intimidate people. When that’s done, the relationship is steeped in adversity and steeped in conflict from the start, regardless of how [an organizing drive] turns out.”

By contrast, he added, “if you start off in an environment where you’re transforming a company into a cooperative, or you’re organizing a new operation into a cooperative, it has to start off in the open. It has to start off in a way where information is shared, and knowledge is shared, and decisions are shared. You want to have the kind of relationship where workers are more knowledgeable, are more involved, are going to make good decisions.”

For that reason, Gerard believes that the union co-op model offers hope for a type of workplace relationship that only has room for improvement over today’s economy. “It’s not utopia,” he said. “It’s an experiment. [But] if it works, it can’t be any worse than the system we got now.”

Beyond the Pittsburgh laundry, the USW has been hard at work – in partnership with the Ohio Employee Ownership Center (OEOC) – to put together a template that unions interested in forming cooperatives from scratch can use to build their own projects. The template highlights what the USW says is a key difference between most mainstream co-ops and a union co-op: “Although it may be common within larger co-ops to elect people to look out for the day-to-day interests of the worker-owners as owners, it’s decidedly less common within co-ops to elect people to look out for the day-to-day interests of worker-owners as workers.” To address workers’ needs, the union-co-op template suggests creating a Union Committee to act as the workers’ agent for bargaining the contract with management. Thus, union co-ops would explicitly have workers’ needs in mind when structuring the working conditions and wages within the co-op. This is something the USW says it is putting into practice in its nascent projects in Cincinnati. Looking to the future, it will be interesting to see what differences emerge in how workers experience union co-ops with Union Committees versus those in other types of co-ops.

With this in mind, I was curious if the Steelworkers’ experimentation with co-ops made Gerard feel more or less optimistic about the possibility of organized labor’s survival in the United States.

“Here’s what I know,” he said. “There’s not an advanced democracy on the planet that doesn’t have a strong free labor movement. Anytime there’s been totalitarian regimes, the foundation of replacing those regimes has been workers coming together with students and other disadvantaged groups in society and fighting for democracy – democracy with a free labor movement.”

“As bad as everything is on the public attack on the labor movement and some of the nasty misrepresentations that are out there, if labor law were changed, people would want to join unions. In spite of all the nastiness that’s brought us, we’re going to survive. Work is changing. You’ve got all kinds of freelancers. We’re going to grow, and we’re going to have to modernize. There are models out there that have to be experimented with, and the union co-op is one of those models.”

“I think if we’re successful in the initial stages, even if it takes a while, we will have a new model that people can look at and promote and grow. What makes me optimistic is that there is a strong consensus that most of the country is fed up with the existing model. When you end up with an economic model where the banks are too big to prosecute, when you end up with 140 companies controlling 70 percent of the world’s production, what does it mean for the little guys?”

“I’m not sure that we’re going to turn Ford Motor Company into a co-op,” Gerard said. “But maybe some of the folks that provide auto parts to the Ford Motor Company can become a co-op.”

After all, he argued, the status quo alternative calls out for replacement: “The model that’s out there stinks.”

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