It is no secret that our Canadian economy is changing. How does this relate to Canadian employee ownership? A great question.
In Alberta, as in many other places across Canada, thousands of oil-related jobs have been lost. Downtown Calgary was almost impossible to drive through a year ago, yet now, rush hour is quite manageable – and it’s not because people are riding bikes.
Employee Share Ownership Plans in Canada are often thought to work best in industries such as engineering, construction, high-tech, and famous little airline companies like the one based out of Calgary, AB. Any guesses?
Recent studies from the United States and the United Kingdom illustrate the strength of companies with employee share ownership plans (ESOPs) compared to non-ESOP companies, especially in times of economic recession.
Recently, B.C., Alberta and Ontario have committed to raising the minimum wage and predictably in all cases, these wage hikes are met with scorn and praise from both sides. While a minimum wage is an essential factor to protect workers and create a minimum standard of living, there is a better solution that Canada should be exploring to help more people build wealth and ensure a competitive economy.
Studies in the United States over the last 40 years have repeatedly identified that an employee share ownership plan (ESOP) with a participation component outperforms one without a participation element.
Participation means that the employees take on the responsibility of their particular job as well as the accountability that goes along with it by participating in decision-making in their sphere of influence within the organization.
Participation is vital to an ESOP. In fact, the same studies have shown that ESOPs without employee participation might be worse than having no ESOP at all. This negative result has been calculated at upwards of 6% of reduced production.
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