The Employee Ownership Update
February 1, 2019
Sen. Gillibrand Includes Employee Ownership in Her Campaign Launch VideoSen. Kirsten Gillibrand (D-NY) announced that she was running for president, and her announcement video highlights her support for employee ownership and the Main Street Employee Ownership Act at 0:38.
Howard Schultz and Employee OwnershipIn other presidential news, Howard Schultz, the founder and former CEO of Starbucks, has gotten a lot of media attention for his possible run as an independent for President. Schultz was an early proponent of employee ownership. When Starbucks did its IPO in 1992, investment bankers opposed Schultz's insistence of giving stock options with a face value of 10% of pay to all employees, including part-timers, who worked for six months or more. Starbucks asked us for data to support the idea that broad-based ownership worked, and that may have helped mollify the bankers. Starbucks' "Bean Stock" program now uses restricted stock units. The units vest over two years at 50% per year. Grants are awarded to all employees annually. Since inception, the program has awarded over $1.2 billion in shares to employees.
Maryland Bill Would Encourage Employee OwnershipA bill introduced in the Maryland House (H.B. 204) would exempt from taxes a portion of income from a transfer of stock in a corporation or LLC to employees. The bill, introduced by Eric Luedtke (D), builds on similar legislation introduced last session in the Maryland Senate.
The Employee Ownership Association of the UK's Annual ReportIts annual report includes some data about the current state of employee ownership in the UK, including that the sector has grown by 10% per year since 2014 up to a current estimated total of 200,000 employee-owners in 350 companies.
Employee Ownership Expansion Network Hires Executive DirectorThe newly formed Employee Ownership Expansion Network (EOeX) has hired Steve Storkan as its executive director. Steve has 25 years of experience with ESOPs, which he will focus on the EOeX's goal of increasing the number of employee-owned businesses across the U.S. by focusing on created state centers for employee ownership.
Scottish Labour Leader Calls for More Employee OwnershipThe leader of the Scottish Labour Party has called for more of an emphasis on employee ownership in Scotland, including giving workers a statutory preferential right to buy a company when it is put up for sale. The Finance Minister of the ruling Scottish National Party, Derek McKay, said, "We will intervene where we can when there's ways we can support companies and the workforce and we do have that desire, as Richard Leonard has set out, for more employee-owned companies."
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