Review of the Literature on Employee-Owned Firms

Abstract

Many of the benefits of employee share ownership are complementary to the policy aims of ALMPs. With regard to SLs this is in particular the case for employment, retention of key staff, access to finance and resilience. The feature that SLs are set up as corporations by a minimum of three partners makes them genuinely different from other ALMP start-up schemes in particular with regard to access to capital. However, over time SLs sometimes face difficulties to comply with the 50% threshold of employee ownership, a problem that is known as deliberate ‘disqualification’. While a change of employee-owned firms to private firms is sometimes connected to possible tensions between owner workers and non-owner workers in the case of SLs disqualification is related rather to the inability not the unwillingness of new employees joining a SL to acquire its shares.