The Baristas Who Took Over Their Café – CoffeeTalk

Last updated Sep 16, 2024

Baltimore’s 230-year-old tradition of workplace democracy is experiencing a revival.

In July 2023, Baltimore’s Common Ground coffee shop announced its closure due to a lack of support from the Hampden community. The shop’s former staff decided to buy out the shop and turn it into a worker-owned and managed cooperative. The Baltimore Roundtable for Economic Democracy (BRED) offered a loan for the purchase and assistance managing the technicalities of the changeover. Within two months, Common Ground reopened with 19 former employees on staff as worker-owners, a welcome surprise for Hampden and workers across the city.

Common Ground is one of the latest additions to Baltimore’s already thriving co-op scene, which includes some of the city’s most beloved businesses, including Red Emma’s, a radical bookstore and cafe founded in 2004; the bike shop Baltimore Bicycle Works, the coffee roastery Thread; and a host of other food companies like restaurant and caterer Mera Kitchen Collective and sweet treat purveyors Cajou Creamery and Taharka Brothers. Co-op-heavy cities like Baltimore offer glimpses at how they can empower workers and at the institutions it takes to grow and sustain the model.

According to historian John Curl, Baltimore was home to the first cooperative factory in America, founded by journeyman shoemakers in 1794 who refused to negotiate on wages and working conditions. Later, in 1809, artisans in the city opened an early cooperative warehouse, buying their materials collectively and selling them together too, without middlemen. More than two centuries later, the cooperative economy remains small in Baltimore and just about everywhere else. As of 2021, there were at least 612 worker co-ops in the whole country, employing just under 6,000 workers.

Thanks in part to another set of pioneering workers in Baltimore, a resource and financing infrastructure has been built to help fledgling cooperatives around the country like Common Ground get off the ground. In 2013, Red Emma’s ran into trouble securing a traditional loan to finance its expansion, thanks to its cooperative structure. Kate Khatib, co-founder of Red Emma’s, explains that the bank chose the three people with the best credit and personal assets as the principal owners of the business, replicating the exclusionary logic of capitalism that says only the people with access to resources, the privilege of learning about finance, and the building of personal assets are allowed to build a business that sustains them.

Seed Commons, a national network of organizations that fund and support worker and other cooperatives, was founded in 2015 by Khatib and other organizers from groups such as The Working World, the Climate Justice Alliance, and the Southern Grassroots Economy Project. BRED, one of its 40 members, has helped finance 15 businesses in Baltimore, including Common Ground, Red Emma’s, and Taharka Brothers. BRED addresses the lending problem Red Emma’s faced by offering cooperative-tailored non-extractive loans, given with no credit score reviews, no demands on personal assets, and no expected repayments until the cooperative is profitable.

BRED hopes to create value and keep it in the community by providing not only loans but the kind of guidance Common Ground relied upon to handle licensing and permits and the other logistics of their cooperative transition. They also assess the viability of co-ops to be and offer candid advice.

Common Ground, thanks to BRED’s assistance, the cooperative transition has already brought improvements, such as wage equity in the front and back of house, and the cooperative is working toward providing healthcare and other benefits. Collective decision-making has brought workers closer, and collective decision-making has brought them more consistent and consistent.

The flexibility and dynamism of democratic decision-making in the workplace can be both an advantage over traditionally structured businesses and a challenge. John Duda, co-founder of Red Emma’s, jokingly jokingly notes that recordings of their early meetings would have turned up “two-hour painful discussions about what kind of milk pitchers to use.” He believes that people are not prepared for democracy at all, as they were not given the tools to actually self-manage.

Today at Red Emma’s, there are general meetings of all worker-owners, each with a profit-sharing ownership stake, where decisions about the business as a whole are made, while smaller subgroups govern specific tasks and functions. Taharka Brothers, which transitioned to a cooperative structure in 2020 and was the recipient of BRED’s first loan in 2016, is currently working on a different set-up. There, a pool of original employee-owners will hire a CEO to handle core administrative duties, while other full-time employees will be able to qualify for company stock shares and a share of profits after some time on the job.

This hybrid model, according to Taharka Brothers cofounder Sean Smeeton, has allowed the company to thrive far more than it would have as a more traditional business. Employee-owned businesses share the burden of ownership responsibilities over many shoulders, and converting to the traditional capitalistic model would likely lead to the company losing its sense of team and purpose.

The Maryland Limited Cooperative Association Act (BRED) is a solution to the hurdles faced by worker cooperatives in transitioning businesses like Taharka Brothers or founding more cooperatives. The state’s business laws do not have a statute on incorporating worker cooperatives, so most cooperatives file for incorporation as standard LLCs, complicating compliance with other laws and making securing financing and logistical matters tricky. BRED has been pushing a solution in the Maryland legislature, the Maryland Limited Cooperative Association Act, modeled after similar legislation in Illinois and other states.

Maryland relies on the notion that there is one individual responsible, meaning co-ops often face situations where they may be asked to pretend to a traditional structure they don’t actually have in place. State Sen. Mary Washington, the bill’s sponsor, believes it is an opportunity for progressive and Democrat legislators to engage in this business space that is often relegated to conservatives.

Federal lawmakers are beginning to take notice of the sector, with 2018’s Main Street Employee Ownership Act making it easier for worker cooperatives to access Small Business Administration loans. Some see cooperatives as an inroad, as successful examples of full-on “economic democracy” will allow for more innovative means of expanding worker power and combating economic inequality throughout the economy.

However, there needs to be a larger context in which worker co-ops are embedded, as worker co-ops can serve as a laboratory or learning environment.