Written by Tindi Sitati, Collaboration Learning and Adapting Officer, with contributions from Olga Oyier, Country Team Lead and Policy and Legislation Affairs Specialist, USAID CLEAR Program by Global Communities.
With millions of African youth entering the labor market annually, the demand for employment far exceeds the job opportunities available, leaving the most vulnerable to exploitation and other risks. This context emphasizes the urgent need for solutions like worker cooperatives, which, while relatively new in Africa, have the potential to empower youth economically, particularly in Kenya where the future of the cooperative movement depends on the inclusion of youth and women in the workforce. This initiative involves a multi-agency approach, fostering collaboration among key stakeholders to facilitate education, technical and legal support, and cooperative network strengthening.
Worker cooperatives are owned and operated by their members, allowing skilled workers to pool their resources to establish businesses that prioritize fair wages, safe working conditions, and stable employment.
Rooted in cooperative principles, worker cooperatives emphasize democratic decision-making, with worker-owners jointly investing in and owning the business. These enterprises not only provide economic benefits, such as higher wages and better benefits, especially in service and informal sectors but also enhance job security and resilience in economic downturns. While still emerging in Africa, the worker cooperative model has gained traction in Kenya, where worker cooperatives have experienced substantial growth, particularly in the service, retail, manufacturing, technology, and design sectors. This growing global movement serves as a beacon of potential progress for Africa, showcasing how worker ownership can drive economic development for businesses and communities.
Through a program by Global Communities, CLEAR, worker cooperatives benefit from direct technical assistance encompassing the development of comprehensive hybrid business documents like strategic plans, business plans, and operational policies. Additionally, they receive coaching and training in various areas such as defining member roles and responsibilities, managing finances, establishing effective governance structures, digital marketing, and promoting gender equity, among other essential topics.
The worker-cooperative model is gaining momentum as an innovative approach to economic development and youth empowerment. Kenya now has an overarching policy framework for worker cooperatives and model bylaws to ease the registration and entry of worker cooperatives. Timely enactment of these bills at national and within the counties will further strengthen the legal backing for worker cooperatives.
CLEAR program, in collaboration with the State Department for Cooperatives (SDC), the Council of Governors (COG), and county governments, embarked on a journey to support the creation of an enabling environment for worker cooperatives. The efforts bore fruit as the worker cooperative model gained official recognition as a unique cooperative enterprise with distinct operational characteristics. This recognition was incorporated into the National Cooperative Policy that was approved by parliament and adopted as Sessional Paper No. 4 of 2020.
Moreover, worker cooperatives have been seamlessly integrated into model county cooperative legislations, allowing counties to customize legislation to meet their specific needs.
To bridge the knowledge gaps surrounding worker cooperatives, CLEAR takes proactive steps by conducting awareness workshops that target youth and informal workers across diverse service sectors, including housing, beauty, wellness, and automobiles. These workshops serve as a platform to introduce the worker cooperative business model and impart essential knowledge about its functioning.
CLEAR has collaborated with the Cooperative University of Kenya (CUK) and the Democracy at Work Institute (DAWI) to advance worker cooperative education and training. This partnership resulted in the creation and launch of the Worker Cooperative Business Course.
Prioritize Business Structures Over Membership Growth: Start-up worker cooperatives should initially focus on establishing robust business structures and systems rather than solely emphasizing the expansion of their membership base. While increasing membership is important, it should follow after key pillars supporting income generation and resource mobilization are addressed. Many cooperatives in Kenya have a high number of members, but a significant portion of them remain inactive, leading to reduced productivity when the number of members exceeds available job opportunities.
- Inclusion of worker cooperatives in the legal frameworks for cooperatives: The inclusion of a legal framework tailored to worker cooperatives is essential to guide the operations of newly established cooperatives and ensure they follow the right path. Given that the worker cooperative model is relatively new in Kenya, the absence of a legal framework hinders formalization. Initiatives like those undertaken by CLEAR to engage government and private sector stakeholders in discussions about establishing a legal framework can significantly contribute to formalization and garner support for emerging cooperatives. Advocacy for cooperative legislation that facilitates registration and operationalization is crucial.
- Provide Technical and Financial Support: Start-up worker cooperatives require both technical and financial support to develop their businesses and compete effectively in the market. Youth and women-led businesses often face challenges accessing financial support, including loans from banks and microfinance institutions. Worker cooperatives, being a relatively unfamiliar model for financiers, encounter similar difficulties. While organizations like Global Communities and the private sector offer technical assistance and training to help young cooperatives establish their market presence, there is a pressing need for increased financial support to make this model viable for youth and women entrepreneurs.
- Establish Clear Communication and Accountability Frameworks: Worker cooperative members should meet regularly, share clear agendas, and develop actionable plans. CLEAR identified disparities between board members and general cooperative members, including differences in opinions and perceptions, even on existing systems. This underscores the importance of regular and transparent member meetings to bridge communication gaps and foster greater cohesion among members.
Addressing Kenya’s Building Collapse Cases through Construction Worker Co-operatives
By Tindi Sitati
As we mark the beginning of 2023, we have an opportunity to reflect on the recent building collapse cases in Kenya and rethink how co-operatives can empower key actors in the construction value chain to build quality housing.
According to the National Construction Authority (NCA), 87 buildings have collapsed in Kenya in the last 5 years, leading to the deaths of an estimated 200 people. If the situation is not addressed, a majority of the population will continue to live in poorly constructed buildings, risking their lives and that of their loved ones. NCA has placed the blame on poor workmanship and non-compliance to standards.
Co-operatives can help restore professionalism and proper coordination among all actors in the construction sector, and this will improve housing quality and adherence to standards that have been put in place by Government and stakeholders.
The construction sector in Kenya is dominated by site workers and contractors who operate informally and are not registered with any authorities. These workers are engaged on a short-term basis ranging from daily, to weekly and they do not qualify for any social benefits. Most contractors ignore health and safety issues that include basic requirements such as helmets on work sites. This leaves site workers exposed to serious accidents and at times death. Many of these workers are also unskilled and unqualified, an issue that may compromise the quality of their work and limit their chances of better pay. Due to these challenges, the majority of buildings are constructed with no quality standards and low consideration of existing bylaws, insurance, and other legal requirements.
To overcome these structural challenges, construction site workers and contractors can organize into worker co-operatives, to gain the power of solidarity and a way to collectively improve their working conditions, negotiate decent rates, influence policies, programs and regulations that directly impact them.
In 2007 a team of construction workers in Nairobi’s Eastlands area came together to form a welfare group – Mafundi wa Kenya Association (MWAKA) to share work-related information for fundis (masons and technicians). They soon realized that they needed to do more together to create employment opportunities and decent work for themselves. They wanted to attract more members and at the same time provide benefits for members. They met with Global Communities and USAID CLEAR Program who introduced them to the worker co-operative business model. In 2017, the group quickly transformed their association into a worker co-operative known as Funditech Service Co-operative which provides housing and construction services.
Training is a key component for Funditech, and they have ensured that of their 107 members, at least 30 per cent have been trained. Members have varied skills in plumbing, electrical, masonry and welding. The co-operative’s mandate to members is to build a growing group of qualified construction site workers, provide training, and produce quality work.
The co-operative selects site leaders who have managerial skills to lead work on construction sites. Both the fundis and site leaders deliberate on the division of labour and procedures at the worksite. The process of decision-making is democratic, and all members are expected to contribute their thoughts and views on different aspects of running the business.
During meetings, full financial statements are discussed, and this promotes a sense of collective ownership and a common mission which yields productivity. The co-operative negotiate contracts on behalf of members and conducts supervision and management of labour that is provided by members who are also workers and owners of the business.
Construction worker co-operatives like Funditech empower members to compete more effectively in the market, and they also access business tools, training, and capacity building that they would not have accessed if they worked individually.
The worker co-operative business model can offer structural and institutional power to construction site workers to mainstream their operations and engagements with other service providers in the sector. Legally formalizing the relationship between construction site workers through the co-operative model – as opposed to simply agreeing to work together – allows workers and other actors to ensure proper workmanship and delivery of quality housing to all Kenyans.
The writer is a Collaboration Learning and Adaptation Officer at Global Communities
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