Labour Share
The Labour Share of Surplus is calculated using the Labour Share Fraction defined in Clause 40, and can only be changed by Special Resolution in General Meeting.
In early versions of FairShares, the Labour Share Fraction was:
- 0.5 in Worker Co-operatives and Employee-Owned Social Enterprises
- 0.35 in Social Enterprise|Social Enterprises and Social Co-operative|Social Co-operatives
From V3.0 onwards, the Labour Share is set by Founders during the formation of the enterprise using the FairShares Rules Generator. The range of possible values is from 0.3 to 0.45.
In companies and cooperatives, the Labour Share can be paid out as a dividend. In associations and partnerships, it is calculated and invested by Labour Members in projects that benefit the workforce and/or align with the enterprise's social objects.
The Labour Share is calculated as follows:
[Surplus] x [Labour Share Fraction]
Each member's proportion of the Labour Share is allocated as follows:
[Labour Share] x (Member’s Labour Shareholding / All Issued Labour Shares).
For example, if the Labour Share is £11,000, and a member has 10 Labour Shares of 180 in issue, their share would be:
11,000 x (10/180) = £611.11
See also:
Return to the FairShares Glossary.
