Partnership Contract (3)


Percentages and proportions

All the workers of the company form 50 percent of the operating capital. No one is excluded and all are co-owners with their respective variable participation quotas. The 50 percent of the capital belonging to the workers/partners must be considered as an indivisible part of their participation and as a proportional part of the political and economic rights regarding the company. The indivisible 50 percent will be represented by a legal entity included in the managerial bodies of the company in representation of the workers.

This legal body is the one that receives 50 percent of the profits of the partnership and proposes the form of distribution to the Assembly of the workers/partners, in accordance with each worker’s participation quota.

I said that this participation quota is variable. Although in principle the quota-portion has the quality of joint property, here the quota cannot be invariable, since the common property will always be 50 percent of the operating capital, but the shareholders may change. The company has movement in personnel. There will be entries and withdrawals for different reasons and, as it is an unalterable principle that all the workers in the company, for the fact of being a worker, are included as participants, the participation quotas will change along with the variations that occur in the personnel lists.

The calculation of the co-owned shares will be laborious but fair in its determination. With the criteria of variability of the quota within the co-ownership of the operating capital, all the problems are resolved, some of which would be insolvable if direct ownership of the capital were assigned. If this capital were divided in stocks and each worker were the owner of a number of them, the mobility of personnel would cause these two problems:

1. Entry of new workers

It is an essential condition that each worker be co-owner of the assets of the partnership. The operating capital is distributed nominally and there are no available portions. Where will the shares come from for the new workers?

There are only two ways to get them. One of them – an increase in capital – is discarded as incongruent. The other form is that the workers give up part of their stocks. The questions that arise are: Who will give up his stocks? How to do it if the stocks are indivisible? Proportionally? Drawing lots? The Statutes of the Partnership can foresee drawing lots, but with this system, a worker could be left without his stock, which is contrary to the system.

2. Withdrawal of personnel

There will possibly be fewer problems arising in the distribution of the shares of withdrawing personnel. There will always be someone to buy the available stocks.

Apart from the problem of assigning the stocks in the case that a worker no longer belongs to the company, another conflict arises with negative repercussions among the workers, because some not only will participate in the benefits according to their efforts and category, but they will also have the quality of investing partners taking advantage of the benefits that correspond to the workers/partners. This attitude, perfectly normal from the economic point of view, can be considered irregular by the workers, breaking the harmony and equality among them.

These problems do not exist if each worker has a variable quota of the operating capital. These quotas can be calculated in different ways, for example:

A) All the workers are classified in categories according to their job, specialty, rank, etc. Each category would be assigned a number of points that will serve as a basis for calculating the respective participation quota, in proportion to the total points that correspond to all the personnel.

A certain arbitrariness is attributed to this system by assigning a number of points to each professional category, which is difficult to verify by the workers who, without any elements available for judging, always will ask why that category has double the number of points of their category. For this reason it is better to take the salaries as the basis for calculating the shares.

B) Using the salaries as a basis for calculation is more realistic as it deals with a concrete and definite aspect and not a subjective estimation. We have two references: the total salaries paid during the year and those that correspond to each worker. The ratio of both values will give us the coefficient with which each worker will participate in the division of the dividend.

Independently of the calculation used, a phenomenon appears that indirectly increases profitability, originating in the desire for receiving higher dividends. Thus, contracting new personnel will be avoided as much as possible, in order for the work to continue being carried out with the normal staff, replacing the withdrawals only in extreme cases. The workers know that these efforts are compensated by higher dividends through lowering the cost of labor.

Two forms for calculating the quotas for sharing the benefits have been indicated. These same percentages will serve to establish the respective contributions to the partnership capital.

The contributions do not constitute direct ownership. They will be administered by a legal body that represents the interests of the workers of the company. This legal body will be the owner of the common shares that will become property in co-ownership, common and indivisible, of which each worker will have his variable quota, as the community is an open association.

Aid and intervention by the State as administrator is essential because of the great amount of money that is needed to put into effect the Partnership Contract of the Third Way. The aids are not loans or subsidies. They have their origin in the execution of a system of capitalization of future work. It is necessary to go to the initial page to verify and understand how, from the uninterrupted construction of houses, substantial reserves appear outside the general Budgets, part of which will serve to finance the entire process of the Partnership Contract. Charged to these resources, the State advances the contributions of the workers. In order to reimburse the capital financed to the workers, a percentage of the benefits that correspond to them will be reserved annually, until the advanced capital is paid back. Interest will not be calculated.

The entire procedure explained is only an example. In practice, other possibilities will arise. What is important is accepting the Partnership Contract as a reality because, based on “globalizehousing”, all the necessary financing will be available.

Next Editorial: April 20, 2002

Challenge for the European Union (1)

See ALL the Editorials at the end of the CONTENTS, on the first page.

Francisco Montaner

Globalizing housing with zero cost