The increasing role of workers' cooperatives
By: Dr. Bernardo M. Villegas
INQUIRER.net
12:31 am | Friday, November 25th, 2011
There are many ways of skinning the capitalist cat. Instead of the
Marxist cry for workers to unite to destroy the free enterprise system
and replace it with Socialism, there is the rising trend towards workers
forming cooperatives to engage in all types of business. I am glad to
see more workers' cooperatives in the Philippine business scene.
My recent two-year residence in Spain gave me a glimpse of what could be
a most powerful instrument to attain the aspiration of the Philippine
Development Plan, 2011 to 2016 of "inclusive growth." As the country
finally achieves authentic industrialization, with more and more workers
being absorbed in the various industry sectors of mining, manufacturing,
construction, and public utilities, the fledgling workers' cooperatives
that are now beginning to appear in Philippine business can blossom into
powerful conglomerates such as the Mondragon Cooperative, a workers'
cooperative in Spain started more than fifty years ago by a Catholic
priest. Mondragon ranks among the top ten largest businesses in Spain
with the most diversified investments in banking, manufacturing,
retailing and real estate. I met some of the top executives of this
famous workers' cooperative (which started in Northern Spain), who
briefed me on the phenomenal growth of their organization, which
implemented to the letter the principles of empowering workers found in
the social encyclicals of the Catholic Church. In fact, its founder's
process of beatification is now ongoing.
I am glad that the final definition of the role of workers' cooperatives
in Philippine business is now coming to a head as the Labor Code is
being updated. The proposed amendment of the "Rules Implementing
Articles 105 to 109 of the Labor Code" by Secretary of Labor Baldoz has
created a perfect opportunity to enlighten all the stakeholders of
business about the nature and essence of workers cooperatives. As
defined under Article 23 (t) of RA 9520, a workers' cooperative is "one
organized by workers, including the self-employed, who are at the same
time the members and owners of the enterprise." More specifically, it is
a social enterprise that is managed by the members who offer labor as
their services to different companies, institutions or entities. In
effect, these members are self-employed individuals who enter into
commercial agreements with corporations and institutions through the
cooperative that they have duly formed and organized.
Through a workers' cooperative, the members are enabled to render work
or labor as the product, service or business thereof, and in return, not
only do these individual members earn from their own labor, but also
benefit from the labor or work of the other members. This form of
business is clearly in keeping with the essence of a cooperative, which
is an organization voluntarily formed by individuals for their mutual
benefit and support, who equitably share in the capital, participate in
the services and become entitled to a fair share of the benefits, as
well as in the other consequences of the undertaking.
Workers' cooperatives have been in existence since the 1930s, initially
formed by hat makers, bakers and garments workers. At present, workers'
cooperatives are globally recognized, with hundreds established in
Europe, North America, South America, the Middle East and India. Among
the more famous ones, in addition to the Mondragon Cooperative in Spain,
are Cheque Dejuener and Acome in France, Kantega in Norway, Suma
Wholefoods in the UK, Egged-Israel Transport Cooperative Society in
Israel, Indian Coffee Houses in India, and Cooperativa Drapner RL and
Cooperativa Nacional de Ahorro y Prestamo in Venezuela. Italy has about
8,000 existing workers' cooperatives. In North America, workers'
cooperatives have organized the United Sates Federation of Workers
Cooperatives and the Canadian Workers Cooperatives Federation.
Workers' cooperatives are clearly contemplated in the 1987 Constitution
of the Philippines, which recognizes the rights of workers to form
organizations, associations or cooperatives for their common benefit.
There is need, however, for the Labor Code of the Philippines to
explicitly recognize the existence of workers' cooperatives. In the
already antiquated Labor Code, there is an almost exclusive focus on the
relationships between employers and employees, failing to take into
account situations in which entities and institutions enter into
commercial agreements with laborers who are self-employed workers. In
view of the growing demand for and supply of this form of contractual
relationship, it is necessary to amend certain provisions of the Labor
Code to effectively include, recognize and protect the rights of these
self-employed laborers who rightfully belong to a workers' cooperative.
The revision of the Labor Code should, therefore, include an amendment
of Article 211 under Chapter I, Book V, on Labor Relations. The
following State policy should be added: "(h) to promote and foster
social enterprises, such as but not limited to cooperatives and
associations formed by contingent, self-employed or non-regular
employees for the protection of their rights and the promotion of social
justice and development." This proposed amendment will assure
industrial peace because it will provide for clear guidelines for
business-to-business negotiations between the members of the
cooperatives and the corporations, entities or industries in need of
labor services.
Secondly, there should be an additional Article in the Labor Code under
Chapter III, Payment of Wages in Title II, Book III, after Article 106
and 107, addressing the workers' cooperative in particular. The
amendment reads as follows: "Whenever a person, partnership, association
or corporation which, not being an employer contracts with a workers'
cooperative, for the performance of any work, task, job or project, the
workers of the said cooperative shall be paid in accordance with the
provisions of this Code. A "workers' cooperative" is one organized by
self-employed workers who are at the same time the members and owners of
the enterprise. The workers' cooperative shall not be deemed the
employer of its owner-members but shall be the organization that will
ensure that the minimum standards and benefits as required by law are
provided to its owners-members.
A third amendment is proposed of Article 82 under Chapter I (Hours of
Work) in Title I, Book III, of the Labor Code to explicitly include
members of workers' cooperatives in the provision: Article 82. Coverage
– The provisions of this Title shall apply to workers in all
establishments and undertakings whether for profit or not, but not to
government employees, managerial employees, field personnel, members of
the family of the employer who are dependent on him for support,
domestic helpers, persons in the personal service of another, and
workers who are paid by results as determined by the Secretary of Labor
in appropriate regulations. "As used herein, 'workers' refers to those
who derive their livelihood chiefly from the rendition of work or
services in exchange for compensation, which shall include members of a
workers' cooperative performing a job, task or duty for a person,
corporation, association, entity or institution."
The proposed amendments will take cognizance of the evolving nature of
the employer-employee relationship that has to respond to the needs of
global competitiveness and the increasing sophistication and education
of workers in the Philippines. For those interested in a concrete model
of a workers' cooperative that already has 34,000 workers-owners and
services some 200 businesses in the Philippines engaged in agribusiness;
merchandising and quick service; auxiliary, property and other
institutions; manufacturing and special projects; logistics; and
telecommunications, access the website of Asiapro-Cooperatives,
www.asiapro.coop.
For comments, my e-mail address is bernardo.villegas@uap.asia.
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