The number of Employee Stock Ownership Plan (ESOP) participants has increased by 8% and the amount of worker cooperatives have more than doubled over the past 10 years, according to a new report released Monday by the Department of Labor.
The DOL’s Employee Benefits Security Administration issued a report to Congress providing updates on its initiative to promote employee ownership, increase workers’ financial security, and enhance their participation in the workplace. The report fulfills a statutory requirement under the Worker Ownership, Readiness, and Knowledge (WORK) provisions of the SECURE 2.0 Act of 2022, directing the DOL to establish an Employee Ownership Initiative aimed at promoting employee ownership and participation in U.S. businesses.
“Employee Stock Ownership Plans transform workers into stakeholders.”
EBSA’s Daniel Aronowitz
“Employee Stock Ownership Plans transform workers into stakeholders,” said Assistant Secretary of Labor for Employee Benefits Security Daniel Aronowitz. “I am proud of the work being done by the Department of Labor, as well as a growing number of states and community stakeholders, to make employee ownership an option for more American workers.”
Aronowitz has been a vocal supporter of ESOPs, and the EBSA is the chief regulator of ESOPs at the DOL under ERISA.
The report also provides Congress with an update on EBSA’s Division of Employee Ownership, which was created in 2023 to support the creation and expansion of worker-owned businesses. The division’s initial activities include:
• Outreach, education, and stakeholder relations aimed at advancing the Employee Ownership Initiative.
• Support for new and existing state employee ownership programs.
• Early-stage technical assistance for employers and employees on questions related to employee ownership.
• Expansion of EBSA’s Employee Ownership Initiative website to educate the public about employee ownership and participation, with special attention to how states are promoting employee ownership.
The initiative’s website serves as a central location for resources providing simple, clear guidance on employee ownership to American businesses and workers. It also catalogs the efforts of state employee ownership programs already operating in California, Colorado, Iowa, Massachusetts, Michigan, New Jersey, Ohio, and Vermont.
The report also describes future work that EBSA aims to carry out to expand this initiative, subject to available resources (acknowledging that while funding has been authorized by Congress for grants and administration, appropriations have yet to be fully allocated).
Read EBSA’s report to Congress.
SEE ALSO:
• Senate Passes ESOP Legislation
• EBSA Nominee Aronowitz: ‘I Will End the War on ESOPs’