Member Stories

New Era Worker Co-op the Cause of Choice for New Member Leah Hunt-Hendrix

Funders can help with capital to launch coops, which is often a challenge for workers

WDN’s 2012 Annual Conference is focused on the theme: “Creating a Fair and Just Economy: What Will It Take?” Different forms of ownership, including worker-owned cooperatives, will be part of our programming and discussions when we gather in Miami Nov. 8-11. The following story highlights the work of one of our members, Leah Hunt-Hendrix, on this issue.

Republic Windows and Doors is famous for unceremoniously firing its 250 workers in 2008, without the notice required by the federal government, and without paying out accrued vacation and pay. The incident gained press coverage because of the resistance the Republic workers displayed, occupying the factory and refusing to leave until receiving what was owed to them.

With the support of their union, the United Electrical Workers, and numerous community allies, including the Center for Workplace Democracy, many of the workers decided to buy the company and run it themselves, as a cooperative.

There was assistance available to help them through the legal and technical aspects of starting a coop, and they knew how to run the business from their collective years of experience working for Republic. The problem was that the workers did not have enough capital to purchase the factory and equipment.

This is the area where the workers really needed help.

At that time, WDN member Leah Hunt-Hendrix met Brendan Martin, President of The Working World, an organization that extends microcredit to worker-owned businesses in Argentina, Nicaragua and New York.  Brendan had helped establish some of the worker cooperatives emerging out of Occupy Wall Street, and had been called by the workers in Chicago to assist them in pursuing the idea of starting a coop.

To Leah, the struggle of these workers seemed like a natural next step for Occupy. “Occupy had done what it could in terms of a wake-up call, but it indicated the need, not only for protest, but for alternatives.  [The Chicago project] felt like Occupy hitting the ground, affecting the community in real ways.”

After a visit to Chicago to meet with some of the workers, Leah wanted to invest.  While she was in Chicago, she saw firsthand the struggle that workers have experienced in their attempts to launch their business and their great potential demonstrating a concrete example for a new economic order.

By the time that Leah got involved, Republic had sold the factory to Serious Energy, and like Republic, Serious had decided to liquidate.  The workers who had once occupied their factory now attempted to gather the resources to purchase the equipment from Serious Energy and resume production as a cooperative, New Era LLC.

Serious Energy had initially agreed to make “reasonable efforts” to find a buyer for the factory, rather than liquidating and dismissing its employees.  But instead, it began to pursue immediate liquidation and sale to auctioneers.  The workers presented a bid to buy the factory, but their offers were ignored.

The workers took up their protest signs once again and set out to the offices of Mesirow Capital, the prime investor in Serious Energy.  Immediately after this demonstration, Serious changed course and came to the negotiating table.

Leah has been involved in helping to raise funds for Working World to lend to the workers, which will allow them to lease a factory and buy the equipment from Serious Energy.  The Working World is lending a great deal of the money that will allow the New Era workers to resume production.

The work of the New Era workers inspires Leah because cooperatives “are one of the most viable alternatives to the current economic system that we have.  And they’re not utopian.  This business structure, along with a loan fund that charges low interest and has a mission to promote coops, is very viable.  Regions with cooperative movements in Europe are very prosperous and have high standards of living.  There is also a more equitable distribution of wealth.”

The cooperative movement is also exciting to Leah because of the potential for culture shift.

If the New Era workers succeed, “worker ownership will be seen by more workers as a viable alternative and will encourage people to give more thought to their ideal business structure when they start a business.  Right now, if have a good idea, you can go out and create a business. It’s very individualistic.  But communities can come together and run businesses.  [I am interested in] a shift in the idea of what business is for.  We have come to think that the point is profit, rather than what is being produced. We are trying to create sustainable communities where people have healthcare and get to spend time with their families. Immense profits aren’t required for a happy life.”

Leah believes we are primed as a society for change because people have observed firsthand that our economic system is flawed.  “We are at a moment where people are so cognizant of the brokenness of our system, and how wealth is concentrated in so few hands.  People are open to the idea of alternative models.  There is real potential right now for the revival of a [cooperative] movement.”

The Working World’s model is important because they don’t just provide finance to worker cooperatives.

“They do two key things: they combine workplace democracy with a different model of finance. Debt inhibits business growth, so the Working World doesn’t require interest payments until the businesses are profitable. Their long-term vision is to put the financier on the same side of the table as the borrower, and to walk side by side with cooperatives.  They provide ongoing assistance to businesses, and they don’t make money until the business makes a profit. That is what credit was meant for.  Investors do earn returns, but only once they have created new wealth for the community.”