The Employee Ownership Update
September 1, 2015
Massachusetts Legislature Considers Pro-Employee Ownership Bill
The Massachusetts House of Representatives voted to give initial approval to a bill that would require people who intend to sell their companies to notify employees that they are eligible to bid on the business. H 1740, An Act relative to job creation through employee ownership
, sponsored by Paul Mark (D-Peru) requires the employer, within seven days of deciding to sell the business, to notify the employees of the sale and specifies that employees "shall have the right of first refusal in bidding to purchase said business corporation through a cooperative or employee stock ownership program."
IRS Webinar to Cover Preapproved Plans
The IRS's September 17 webinar
will cover a number of topics, one of which is its new initiative to allow preapproved ESOP and cash-balance plans. Registration is required.
Oakland Passes Worker Cooperative Resolution
The city council of Oakland, California, has passed a resolution
designed to encourage the creation of worker cooperatives. Joining other cities like New York; Madison, Wisconsin; and Richmond, California, Oakland is considering passage of resolutions that would create incentives and investments in worker cooperatives.
ESOP Lenders List: Your Input Wanted!
The NCEO is creating an ESOP lenders list that will be available in the members area of our website. Although we're calling it a "lenders list," the goal is to provide a list of companies that are potential sources of capital for ESOP transactions, including organizations that provide other sources of capital. Please send Corey Rosen (CRosen@nceo.org
) names and contact information for the institutions that you have direct experience with as sources of financing for ESOP transactions over the past two years, including contact name and branch/location, if appropriate.
OECD Recommendations on Pensions Discourage ESOPs
In a draft for comments
, the Organization for Economic Co-operation and Development's Council on the Core Principles of Private Pension Regulation suggested limits on company stock in pension plans. Their recommendation 4.16 states, "Investment in the assets of the plan sponsor, in parties related or affiliated with the governing body of pension fund, the pension entity or pension fund management company should be prohibited or strictly limited to a prudent level so as to ensure diversification (e.g. 5 percent of the pension fund assets) or otherwise avoid undue risks or costs to members." The draft is open for comments until October 20.
Employee Ownership 100 Generates Press Coverage
Since the NCEO released The Employee Ownership 100: America's Largest Majority Employee-Owned Companies
, newspapers around the country have picked up the story.
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