Steelworkers Create a Working Agreement
With World’s Largest Worker-Owned Co-Op

The United Steelworkers (USW) and the Spanish-based Mondragon Internacional, S.A. have announced a framework agreement for collaborating to establish Mondragon cooperatives in the manufacturing sector within the United States and Canada.

The manufacturing cooperatives that will be created in the U.S. will adopt the collective bargaining principles of the Mondragon worker-ownership model of “one worker, one vote.” The agreement was reached on Oct. 27.

The Spanish co-op was started in 1956 in the Basque rural town of Mondragon by a visionary priest. Today, it has some 100,000 cooperative members in 260 enterprises and has a presence in more than 40 countries,

The co-op has its own university, bank and social security system. In 2008, it reached annual sales of more than 16 billion euros ($23.5 billion). It is the seventh largest enterprise in Spain and the world’s largest industrial workers cooperative.

“We see today’s agreement as a historic first step toward making union coops a viable business model that can create good jobs. empower workers and support communities in the United States and Canada,” said USW International President Leo Gerard. “Too often we have seen Wall Street hollow out companies by draining their cash and assets and hollowing out communities by shedding jobs and closing plants.”

Steelworkers Chart New Path for Labor’s Global Power

The Steelworkers’ bold and unprecedented deal with Mondragon is a remarkable achievement on at least two counts. It can open up a new foreign market for U.S. manufactured goods. It can provide good-paying jobs by creating a chain of co-op stores that are committed to union standards. It also can strengthen labor’s role in the global marketplace.

The USW has opted to globalize its operations by forming alliances with its foreign counterparts, unions that represent employees at the same global companies where USW members work. But it has also negotiated a merger with the newly-formed Unite. the U.K.’s largest union—a move that would create an organization of 3.7 million members on two continents.

There has, as yet, been no official reaction to the USW-Mondragon deal from the top leadership of the AFL-CIO or the international union affiliates. It will be interesting to see if other unions follow the Steelworkers’ example and seek out links with progressive foreign companies that are willing to make agreements that include acceptance of union standards.

LaborTalk (11) will be posted on Thursday, November 6, 2009.