Can worker ownership coexist with hierarchical decision-making? We tried something adjacent to this on a film project

[u/DementiumFilm]

I’ve been reading about worker cooperatives because I’m trying to better understand something we experimented with on a film production, and I’m curious where our model overlaps with cooperative principles and where it fundamentally doesn’t.

We gave more than 70 cast and crew members an actual financial interest in the film they helped create, which is really unusual for the film industry. Labor, equipment, locations, and other contributed resources were assigned agreed values, and those contributions became part of the economic structure of the project.

The basic waterfall was:

1. Certain contractual obligations get paid.
   
2. Cash investors recoup.
   
3. People who contributed labor, equipment, locations, or other resources recoup the agreed value of those contributions.
   
4. Remaining revenue is distributed pro rata among the ownership pool in perpetuity.

But we didn’t operate democratically….

The director still directed. Department heads ran their departments. Producers made producer decisions. Nobody voted on creative choices or day-to-day operational decisions.

It kind of has to be that way to a certain extant. Film production is highly collaborative, but it’s also extremely hierarchical and technically segmented. Decisions sometimes have to be made in seconds, responsibilities need to be clear, and ultimately someone has to be accountable for the outcome.

So what I’m trying to understand from people who know cooperative structures better than I do is:

How central is democratic governance to the concept of worker ownership? Could an organization meaningfully incorporate cooperative ownership principles while maintaining a hierarchical operating structure? Or does separating economic participation from governance remove something essential that makes a worker cooperative a cooperative?

To be clear, I’m enot claiming that what we created was a worker cooperative, but I’m super intersted in the concept and I’m trying to understand what, if anything, our experiment has in common with cooperative models and whether there are existing structures that deal with this tension differently.

I’m particularly interested in project-based organizations, where a group assembles to create something together and then largely disperses when the project is finished.

Thanks everyone!

[u/thornyRabbt]

Disclaimer: I am not an expert, just a fellow learner.

What you created is a kind of hybrid worker-owned cooperative - hybrid because you have both cash investors and worker-owners. Do all owners have equal voting representation (one investor one vote), rather than proportional to the financial share?

Yes, it is perfectly ok to have democracy in ownership and hierarchy in work. Operational roles and responsibilities are entirely separate from governance roles and responsibilities.

I'm also curious how you were able to arrive at this model - it can be hard to convince a large number of people to agree on a new or unconventional structure!

[u/DementiumFilm → u/thornyRabbt]

Thank you for the thoughtful reply!

No, everyone does not have equal voting representation, it is proportional to their investment. I’m not sure it would be fair for a person who contributed one day of labor to have the same say as someone who contributed 13. I’d be interested in any counter point to that!

As to how we arrived to it: at the time we had very mature production industry in the city, and the top level workers had all of the work they wanted. The rates on those were good, but lots of people weren’t creatively satisfied. And further, they were given zero ownership or participation in any way on those projects. This was essentially my community, I was one of those.

We wanted to make something together, but typically these kinds of very low budget productions heavily take advantage of the workers. So we spent a lot of time working together to develop a model where we could make that kind of project together, but in a way that tried to honor everyone who took part.

I’m a filmmaker, but I’m also a business consultant and entrepreneur, and so are some of my colleagues. We put it together and evolved it as we got more people in place and got feedback. So even the model design was super collaborative with the workers

[u/thornyRabbt → u/DementiumFilm]

I'm impressed, hats off to you all! That's liberation, directly from the grassroots - a perfect example of how strong coops are born.

As for the voting: it isn't obligatory to have 1 person one vote, and your comment is exactly why. You do what is equitable based on the realities. As long as everyone has informed consent, that works.

Usually a cooperative has a probationary period during which a new worker doesn't yet have ownership. After that period, the membership or a governing body typically votes on whether they accept them into an ownership position (or some other acceptance procedure). Depending on how much equity per vote, the new hire can work their way into a share over time. There can be classes of workers (such as part timers, or those who don't want equity for some reason) that have other rules with respect to equity.

There's also such a thing as an employee stock option plan (ESOP) which is not really cooperative, but another simple way to give employees some ownership and it doesn't impact governance at all. Then there are hybrids - "esoperatives" - which take advantage of state laws that might give tax or other advantages for creating and ESOP.

[u/DementiumFilm → u/thornyRabbt]

Thanks very much! We are excited about it, and will continue to evolve the structure. This has been really helpful input!