Labour Share Fraction

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The Labour Share Fraction is the share of Surplus paid to Labour Shareholders.

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 Enterprises and Social Co-operatives

From V3.0 onwards, the fraction is set during the creation of rules in the FairShares Rules Generator, and this provides for a range of choices from 0.30 to 0.45.

In associations, this fraction (as is the case with Founder and User Share Fractions) determines the share of surplus Labour Members (as a group) can allocate to social objects without board approval.

The V3.0 rules generator does not permit rules to specify more than 0.4 for Investor Shareholders, and sets the minimum payout to Labour and User Members at 60%. Typically, 70% or higher is paid out to people active in FairShares companies, and 75% of higher in FairShares cooperatives.

The total amount paid out to Labour Shareholders is called the Labour Share.


Return to the FairShares Glossary.

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