Introduction to Employee Ownership

Atty Michael Jonas (00:32):

Um, I’m Michael by the way. I’m the owner and principal attorney of Rational Unicorn Legal Services. We do community business law for everyone in the community. So, um, we believe that business building and, um, community building go hand in hand. Uh, we’re a certified benefit company. We actually are headquartered in Portland, Oregon, but we offer services to all three states on the west coast, California, Washington, and Oregon. And we do IP law and nonprofit services cause they’re federal, um, for anybody in the United States. And we’re certified benefit company, which means we believe in the triple bottom line. So, um, as a company, we don’t just believe in making a profit. We believe in the planet and in people and are, um, very intentional with both, with who we hire and the work that we do. Um, we don’t take large retainers. We do a lot of pay as you go, flat fee project based billing. So we talk to you, we figure out what you need, and then we tell you, you know, these are the suggested all inclusive projects that include calls and emails that you need.

Atty Michael Jonas (01:36):

Um, so very different from most, uh, law firms in terms of our structure and model. And then our categories of clients. They’re small businesses, they’re nonprofit organizations, and they’re artists and entertainers. Sometimes these worlds collide, you know, will have, um, an art gallery that profit or have, um, uh, you know, an art organization or something like that. But we have a lot of creative, hardworking, passionate clients. Um, so I mentioned this earlier, I gave you some caveats. Um, there’s a couple caveats, but there’s a big one. One of these is that this is overview and that’s all. Um, there’s no possible within the have 40 minutes that we could cover all these things. They’re also gonna be, they also may seem, um, complicated and highly simp simplified for purposes of, um, a seminar like this. So what does it mean for a company to be employee owned?

Atty Michael Jonas (02:37):

So before we actually get to the options, we have to talk about that. So there’s this organization that I want you to know about, actually really great resource. It’s called the National Center for Employee Ownership. And they say that employee ownership is a term for any arrangement in which a company’s employees own shares and their company or the right to the value of the share of the company. Employee ownership is a broad concept that can take many forms ranging from simple grants of shares to highly structured plan. What this doesn’t say here is membership interest. So most of our clients are actually LLCs, and when you’re an llc, you don’t really think of ownership in the same way in terms of care, we can call them membership interest. So that is still a form of employee ownership, giving an employee a percentage of membership interest in your llc.

Atty Michael Jonas (03:35):

So this definition’s very corporation specific, but if you don’t have a corporation and you have an LLC that is still considered, um, potentially an employee ownership model. So we’re gonna be talking today about, um, oh, okay, well, we’re gonna be talking about the, the specific of the types of employee ownership. But before we do that, I wanted to talk about kinda the pros and the cons of having an employee ownership model.