Organizational dynamics of worker cooperatives in Argentina

The principles of production cooperatives were formulated by Philippe Buchez in the Journal des sciences morales et politiques (1831). He describes the entire plan for a workers’ association, conceived as a means of improving conditions for employees in cities, a publication which precedes, by over a decade, the statutes of the Rochdale Pioneers, where such associations appear.

These characteristics are recognized by the International Organization of Industrial, Artisanal and Service Producers’ Cooperatives in their World Declaration on Workers’ Cooperatives (CICOPA 2005). The declaration recognizes the definition of a cooperative, its values and principles, as contained in the Declaration of Cooperative Identity issued by the International Co-operative Alliance (ICA 1995) ratified by Recommendation 193 of the OIT on the Promotion of Cooperatives (ILO 2002).

In return for the work carried out, the cooperative allocates the member with a provisory price, generally adopting the current standard price for workers in the same sector/activity established in the respective collective working and wage agreements. At the end of the financial year, the cooperative decides on a fixed price for the work, and once the accounts have been approved, members receive any additional payments still owing to them after the original provisory ones paid during the year (Cracogna 2004).

Numerous initiatives existed previously in terms of substantive law, as well as various national, provincial and municipal regulations that brought in measures to promote cooperatives at different periods (Drimer and Kaplan de Drimer 1973).

One of the most notable negative characteristics of the 1990s was the sharp rise in unemployment figures which grew at an annual rate of 14%, quadrupling the number of unemployed people over the course of a decade in the area of Greater Buenos Aires and tripling the number in the inner city areas. In October, 2001, 2.5 million people were listed as jobless nationally, which meant that 21.9% of homes faced a situation of having at least one of its active members jobless (Monza 2002).

The cooperative called ¨La Edilicia de Pergamino¨ was founded by twelve construction workers in 1928. By 1950, it had over 170 workers from all different areas of construction and owned a brick and tile factory devoted to carrying out large-scale public and private contracts.

The main effect of expropriation is the transfer of property. In order to have a place, adequate compliance is required at all stages of the expropriation process, including full payment of compensation prior to the transfer. These steps provide for the legislative classification of public utility, the administrative determination of the property and the procedure itself, i.e. the expropriation trial.

Different analyses relating to the phenomenon of recovered firms identify the problem of this type of enterprise at three different moments in their evolution. The first of these corresponds to isolated experiences prior to the 1990s as a result of processes of privatization or stagnation of economic activity (Vuotto 2004). The second occurs within the context of the economic crisis in 2001 and is significant due to witnessing the movements that form the crux of and represent the sector. During this period, considered by some authors as the origin of this type of firm (Fajn 2003), 161 firms of this type were constituted, mainly in the area of Greater Buenos Aires. By 2005, these firms had a total of 7,135 workers (Ministerio de Trabajo 2005). The largest number of cooperatives belonged to the metalworking industry, followed by the food sector. In the third period, from 2005, in a context of an improving economy and a drop in unemployment at a national level the process of firm recovery continued and 40 new firms were created (Palomino et al. 2010).

The Program was promoted by the Ministry for Federal Planning, Public Investment and Services in conjunction with the Ministries for Social Development and Labor. To be included in the Program, cooperatives had to be constituted by a minimum of sixteen people and unemployed people not eligible for unemployment subsidies; those under 18 years of age or who exceeded the maximum age for the subsidy, could form a part of the cooperative as long as they did not go over 25% of the total number of members, whilst not more than one family member could belong to a particular cooperative.

The objective of the program was to create 100,000 new jobs through the constitution of cooperatives aimed at jobless people of between 18 and 64 years old. The cooperatives from this Program are made up of 60 people and their objective is to carry out small-scale building work in the interest of the community (construction and repair of streets and sidewalks, renovating squares, etc.).

The identity of worker cooperatives is based upon the business structures that were built on the principles, values and operational methods of cooperatives around the world. These principles are reflected in the Statement on Cooperative Identity (ICA 1995) and agreed on within the framework of the International Cooperative Alliance (ACI), and included in Recommendation 193/2002 of the OIT on the Promotion of Cooperatives. The principles established in this statement are: open and voluntary membership, economic participation of members, democratic control exercised by the members, education, training and information, cooperation between cooperatives and commitment to the community.

From an interpretative perspective, organizational identity is inherent in a relational perspective; it requires comparisons with the outside world and is consciously self-reflexive (Hatch and Schultz 2004, 2002; Brown et al. 2006).

58 cases of cooperatives were analyzed from different sectors of economic activity, differentiating between the autonomous cooperatives of those whose creation was the result of the recovery of firms or induced by government programs. The main variables considered in the analysis allowed for the identification of significant differences with regard to the management of the firm and of the association, and grouping relatively homogenous organizations together with regard to their behavior.

Since the 1990s, “job fraud” represented a common problem due to the use on the part of some employers of worker cooperatives to reduce labor costs by not applying current work regulations.