Canada Urged to Back Employee Ownership Trusts to Shield Economy

A recent opinion piece in the Vancouver Sun makes a compelling case for why Employee Ownership Trusts (EOTs) could be key to building a more resilient Canadian economy amidst economic uncertainty and increasing trade tensions with the U.S.

Grantbook: Canada's First EOT Pioneer

Federal legislation in the country last year introduced EOTs as a new vehicle for business ownership transition.

In January 2025, Grantbook, which provides advisory services to philanthropic foundations, became Canada's first company to convert to the EOT ownership model.

Why Democratic Employee Ownership Makes Economic Sense

The authors argue that democratically employee-owned firms offer multiple benefits that could help shield Canada's economy from external shocks:

• Community Rootedness: When employees own their workplace, they're unlikely to relocate operations overseas or chase the cheapest labor markets. This creates stability for local communities even during economic turbulence.

• Resilience During Downturns: Research shows that employee-owned businesses weather recessions better than traditional companies. They're less likely to fail during economic crises and more likely to maintain employment levels and wages, which helps stabilize the broader economy.

• Competitive and More Equitable: Contrary to what some might expect, democratic employee-owned firms can be just as profitable as conventional businesses—sometimes more so. The difference? Profits are distributed more equitably, reducing inequality both within companies and across society.

• Better Handling of Technological Change: As AI and automation transform workplaces, employee-owners are positioned to share in productivity gains rather than simply losing their jobs. When workers have ownership stakes, technological advancement becomes an opportunity rather than a threat.

Employee Owned Firms Across Canada

While still relatively rare, successful employee-owned firms operate throughout Canada:

• Friesens, one of Canada's leading book printers based in Manitoba

• Shift Delivery, a worker cooperative providing bike-powered delivery services in Vancouver

• PCL Construction, one of the country’s Top 100 Employers for 2025, and Chandos Construction, which employs 700 people, both 100% employee-owned

• The model is particularly common in the country’s Quebec province.

Policy Recommendations

The authors suggest several ways governments could foster this ownership model:

1. Provide seed grants to establish regional employee ownership centers

2. Create a public investment bank focused on democratic employee-owned firms

3. Ensure these businesses are prioritized in existing public investment programs

4. Give workers first right of refusal when businesses are being sold or closed

5. Introduce tax incentives, including lower corporate rates for democratic firms and personal income tax deductions for workers investing in cooperatives

With Canada facing "an unprecedented threat from an unpredictable and hostile U.S. administration," the authors argue that democratic workplaces offer a path to a "more equitable, empowered and resilient economy."

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