DEFINITION
Most of the capital in an employee-owned company belongs to its workers.
Based on theoretical foundations akin to co-operatives, employee-owned companies in Spain have proven their high potential for generating undertakings. The social capital in such undertakings belongs for the most part to the workers. The fact that the workers are partners in the company favours self-motivation when approaching each project. There is a minimum requirement of three partners to establish such a company. The procedures to establish such a company are similar to any other trading company.
Employee-owned companies have the following characteristics:
- Most of the capital belongs to the workers with permanent contracts.
"It fosters permanent employment between partners "
Limitation in the partner’s capital. No partner can hold more than 33.33% of the capital, except if it is a public institution or a non-profit company. In such cases, a partner’s share cannot exceed 50%. Consensus of the working partners in all strategic decisions is indispensable.
"Not more than one third of the capital is in the hands of one partner"
- Limitation in the number of working hours: the total number of hours carried out every year by the permanent workers cannot exceed 15% of the total number worked by the working partners. If there are less than twenty-five employees, this amount increases to 25%.
- The company may be a private or public limited company. In the former case, a minimum capital of 3,000 Euros is required to set it up. In the latter case, 60,101 Euros is required.
- Preference in the transfer of shares/participation. Permanent workers have preference in acquiring shares/participations, followed by working partners and, then, capitalist partners, the company and, finally, a third-party outside the company may have access to them. Shares/participations are always personal.
LEGISLATION
- Royal Decree 2114 of 2 October 1998, regulating the Administrative Register of Employee-Owned Companies.
- Law 44/2015 of 14 October on Employee-owned and invested-in companies
