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Posted on May 23, 2011 The Philadelphia Inquirer

SMALL BUSINESS

Crafting A Business Owned By Its Workers

By Diane Mastrull

Inquirer Staff Writer

As weddings go, the Northern Liberties affair was somewhat atypical, what with the presence of saws and sanders, and the stockpiles of salvaged lumber.

But this union, consecrated on a handmade stage built of railroad ties and bowling alley sections, was

nevertheless emotional - no doubt most so for Brendan Isaac Jones.

On that day last month, Jones watched his baby be joined with another - or, rather, with others.

Greensaw Design & Build L.L.C., Jones' small construction business on North Fourth Street, became a worker-owned cooperative. It is believed to be the first formed in Philadelphia this century, and one of an

estimated 500 in the country.

Such initiatives were more of a movement in the 1970s and '80s, but are now far outnumbered by employee stock-ownership plans (ESOPs). Those have tax advantages and a leadership structure not as committed as worker co-ops to giving all employees a voice in business decisions. There are more than 11,000 ESOP companies in the United States, employing well over 13 million people, according to the National Center for Employee Ownership, a research nonprofit in Oakland, Calif.

An interest in establishing a more formalized democratic business structure for Greensaw enticed Jones

down a path of research and reflection that led to his relinquishing sole control of the business last month.

"I fully expect to throw the tantrum of a 4-year-old when someone tells me I can't have my way," Jones, 32, joked, sort of, during an interview. Greensaw is a five-year-old company with a sustainability mission

centered on using salvaged materials for construction.

In the converted garage on Fourth that serves as Greensaw's headquarters and workshop stood lengths of walnut from Bucks County trees struck by lightning, Douglas fir planks from a bowling alley in Brooklyn, N.Y., and shelves of walnut veneer and oak cord from JPMorgan's private library in

Manhattan.

On a conference table upstairs sat a copy of Greensaw's two-page governing goals and principles, signed by all 14 employees at the co-op's inauguration last month even though initially, only three others will share the title of owner with Jones. It emphasizes giving every employee a shot at ownership, a vote "regardless of ownership interest or capital contributed," and a share of any profits. As a company in the hard-hit construction industry, where work is limited and contractors eager to do it plentiful, Greensaw made $10,000 in profits last year, Jones said.

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The road to its worker-cooperative status started 16 months ago, said Jones, a French and English literature graduate of England's venerable Oxford University. His passion for salvaged materials is not

only for their green value, but for the stories behind them.

Jones said he was reading a newsletter on companies committed to the triple bottom line of people, planet, and profit that included an article about a worker-owned design-and-build cooperative on Martha's Vineyard - South Mountain Co. Jones called its founder, John Abrams, and had everyone at Greensaw

read his book, Companies We Keep.

"It became our Bible," Jones said. "People would be sanding with their earbuds in" listening to its audio

version.

What struck Jones, he said, was that Greensaw already was functioning like a worker-owned cooperative in many ways. He said there was "not much" of a hierarchy in place, and employees had the opportunity to become project managers once they proved themselves. There also was camaraderie - including Friday

night boxing sessions to work off steam, crabfests, and beer.

"People were already functioning cooperatively," said Jones, who concluded that forming a worker

cooperative "felt like a really natural fit."

In Jones, Abrams saw himself, he said in an interview last week. Like Jones, Abrams, now 61, was in his 30s when he decided to make his company an employee-owned cooperative. South Mountain had been in

business 14 years by that time.

The relatively young age of Jones and his company make Greensaw's transition to a worker cooperative

especially notable, Abrams said.

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"Many of the companies that are transitioning to employee ownership are baby-boomer companies, where the founder has put heart and soul into the business for 30 or 40 years" and wants an exit plan that responsibly continues the original mission, Abrams said.

One of the things Abrams said he emphasized to Jones was that he had to make "a real commitment . . . to

letting go and to trusting" the Greensaw employees he hired.

Jones also sought guidance from James G. Steiker. He is chairman of the Steiker, Fischer, Edwards & Greenapple P.C. law firm, and heads SES Advisors Inc. They are related Manayunk companies that focus

on all aspects of employee ownership.

Along with counseling Jones on the mechanics - establishing a buy-in price ($3,500 over six years) and the criteria for employees to become owners - Steiker said he talked to him about the emotional

adjustment that would be required of him.

Like any owner of a business that converts to a worker-owned entity, Jones has to "come to terms with what part . . . do you want to or need to view as your individual birthright from creating the company, and what is it that you want to share, and on what terms?" Steiker said.

The overwhelming impression he got was that Jones "obviously cared very deeply about what was going to happen to this company and how people would be rewarded, and how he would be able to preserve the

mix and vision of the company."

Abrams traveled to Philadelphia for Greensaw's cooperative conversion ceremony to impart some

supportive words.

"I tried to inspire the whole group to understand how momentous this day was, what an important thing they were doing," said Abrams, who considers worker-owned cooperatives no less than "our path to a real

democratic economy."

Carpenter David Wing, 34, a three-year Greensaw employee and now one of its owners, said he was as

proud of the worker-cooperative agreement as the creations he conjures from the region's discards.

"If you manage to build a strong-enough foundation, this beautiful thing that you helped create can kind

of exist without you," Wing said.

As for Jones, he's envisioning some freedom to restore a tugboat he owns in Alaska and to finish his novel. It's about a carpenter.

Contact staff writer Diane Mastrull at 215-854-2466 or dmastrull@phillynews.com.

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