Historically, worker cooperatives rose to prominence during the industrial revolution as part of the labour movement. As employment moved to industrial areas and job sectors declined, workers began organizing and controlling businesses for themselves. Workers cooperative were originally sparked by “critical reaction to industrial capitalism and the excesses of the industrial revolution.” (Adams et al. 1993: 11) The formation of some workers cooperatives, such as those of the Knights of Labor in 19th century America, were designed to “cope with the evils of unbridled capitalism and the insecurities of wage labor”.[3]

Most early worker co-ops did not adhere to clear cooperative structures or ideologies. Starting in the 1830s, worker cooperatives were formed by hat makers, bakers, and garment workers.

In the United States there is no coherent legislation regarding worker cooperatives nationally, much less Federal laws, so most worker cooperatives make use of traditional consumer cooperative law and try to fine-tune it for their purposes. In some cases the members (workers) of the cooperative in fact “own” the enterprise by buying a share that represents a fraction of the market value of the cooperative.

When the current cooperative movement resurfaced in the 1960s it developed mostly on a new system of “collective ownership” where par value shares were issued as symbolic of egalitarian voting rights. Typically, a member may only own one share to maintain the egalitarian ethos. Once brought in as a member, after a period of time on probation usually so the new candidate can be evaluated, he or she was given power to manage the coop, without “ownership” in the traditional sense. In the UK this system is known as common ownership.

Some of these early cooperatives still exist and most new worker cooperatives follow their lead and develop a relationship to capital that is more radical than the previous system of equity share ownership.

Source: http://en.wikipedia.org/wiki/Worker_cooperative