Maybe I am missing something - you need their labor to produce value, yet you think they don’t deserve even a small stake in the success of the business?

Is this not exploitation? Why do you assume they just get to take 50% of your business for being hired?

It sounds like you are concocting a scenario which assumes an idealized socialist/communist society and then projecting your own capitalistic desires onto it.

Isn’t that a little incongruent?

Well if you’re talking in an idealized world, where capitalism hasn’t driven business ownership deep into the psyche, it would be easy. You’re working for the greater good and you have no concept of what business ownership is.

Your story is of a person living in a capitalist system and working as an owner-proprietor, i.e. you are petty bourgeois. In your immediate relation to production, you are neither exploiter (with no employees) nor exploited (you pay yourself whatever you want and put the rest into the means of production that you also own).

Your question is then to ask whether it is fair for employees you hire under a capitalist system to have an equal say in the business even though they haven’t been there as long nor paid to own the means of production.

The first thing to get out of the way is that socialism is not an isolated and awkward transition from a private business to a worker’s co-op. It is a wholesale transition away from private ownership, wherein owners of businesses have quite dictatorial powers over employees (and others) due to owning the means of production, influence over cops, the government, etc. As a system, capitalism is generally not owner proprietors. If everyone were petty bourgeois like this there would be no exploitation and capitalism itself simply wouldn’t exist in the first place. Capitalism requires profit maximization at the expense of employees. It consists of a series of competing companies run by owners that employee workers. As the system has advanced and owners own more and more, those owners don’t even really do work alongside workers. They aren’t petty bourgeois, they are haute bourgeois, they spend their time on schemes for moving capital around. And all of them make their money via the systematic underpayment of workers.

The bourgeois do not do this simply because they love their employees to be poor. They are forced to do so by the market system itself. If they pay their workers too much, they will be outcompeted by the other companies providing the same product. So the ruthless minimization of wages continues, culling businesses that choose to be more humane. And so we see people driven down to subsistence, or at least different forms of it.

The escape from this system is the reappropriation of control over production to be in the hands of those who actually produce. This requires oppression of the current owners, not because of personal animus but because they will violently oppose this attempt. Such is the case historically. They will murder you and your entire family rather than give up power.

Finally, in systems run by socialists, where societal changes were being made, the petty bourgeois have frequently maintained their positions, or had them modestly transformed. It really depended on circumstance. Usually, the horrors and brutality that had been visited upon the people, the workers, the peasants, corresponded to how the bourgeois, the landowners were treated. A well-liked owner proprietor was usually not a target and often just kept doing their thing.

So, the first point is that you are not describing socialism. You’re describing an attempt to create a worker’s co-op under the capitalist system.

So, assuming your question is about how to form a worker’s co-op under the capitalist system in a way that seems more fair, don’t worry! This is a common question. Sometimes owners retire and create a co-op in one fell swoop, knowing that their personal wealth is fine and their former employees deserve to own what they run. But you’re saying this is mid-career, where you haven’t yet even had workers to exploit and are still working alongside, yes?

In that case, there are several options, most of them amounting to accruing buy-in. Workers gain ownership of the company over time by working for it. Their tenure amounts to shares, basically. There are stratagems for handling pitfalls, like capping shares so they become horizontal after some period so that someone that worked there 25 years doesn’t have more vote than someone who worked there 15, for example. Most Institute a transitional period for decision-making. For example, staff votes equally on certain decisions but not others at first. Over time, as workers accrue ownership, they gain more decision-making power.

These are some ways to navigate an individual petty bourgeois person’s desire to have a co-op without losing their personal sense of ownership over that they’ve built up as owner-proprietor.

Furthermore, what’s to stop the two new workers from democratically voting me out of the operation, keeping the store, name, brand, and equipment for themselves?

This implies private property still exists in this scenario, only that instead of a capitalist, the business itself (as a legal person) owns its land, equipment, etc and it’s managed democratically by the workers like a mini-state. That is not socialism, it’s a workers co-op operating in a capitalist world.

In a true socialist society everything would collectively owned; the bakery would be there because you convinced your local community to give you a space for it, and the new workers couldn’t unilaterally go against the community and kick you out like that.

Furthermore, what’s to stop the two new workers from democratically voting me out of the operation, keeping the store, name, brand, and equipment for themselves?

Depends on the bylaws you set up.

In most Co-operatives, there’s a time period where a new employee is not given an ownership stake. Then there are specific procedures that layout that a member can only be removed if they have been found guilty of X number of misconducts over time. And even then, the bylaws usually try to remedy the situation before requiring a unanimous (minus 1) vote in order to remove the person.

In all likelihood you wouldn’t “hire” a dishwasher, you’d enter into a partnership with another partissier or an educational agreement with an apprentice.

We could try to math it. Say you invested $1m into the whole thing. Now you’re doing great and bringing in $1m/yr, but you’re turning people away. In order to make more money you need to hire people. So you hire those 2 you mentioned. You pay them each $100k/yr after benefits and insurance and whatnot. They in turn allow the business to make $1.5m/yr or $300k “extra” after you pay them. You can think of that $300k “extra” as wealth they are creating and then “investing” back into the company. After 4 years they will have “invested” just as much into the company as you ever did, and should probably have an equal say in the decisions, and probably start getting an equal share of the profits.

The biggest issue with this question is that it frames Socialism as “Capitalism, but someone passed a law requiring equal ownership of business entities.”

I think a more useful method of learning would be to ask questions about actually proposed or existing forms of Socialism, many of which eliminate competition altogether.

What if you were all on an equal level of value? Like, let’s say you need a dishwasher - and you manage to hire someone who has won the national dishwashing championships (this should be a thing, imo) who also has some skills in marketing. And you need someone for the register, but that person is amazing at customer management and also has great web design and social media management skills?
If you’re coming to the business and each bringing something that is really valuable, I could see a level split in ownership of the business making sense.

I’ve not studied this but I see a solution in contracting other businesses to do the labor required. Something like a collectively owned customer service business.

Yeah, this is a core issue that socialists have failed to address with the average person, and I’ve never seen anything concrete from a legislative or regulatory enforcement (let alone a transitionary) perspective; all necessary if you want people to support and vote for, a socialist transition. Expecting people to do the right thing for the greater good is simply an unrealistic fantasy. “From each according to his ability, to each according to his needs/work” is extremely subjective, vague, and open to wide interpretation. Who decides what a “need” is? Who decides what level the impact the work or labour has on a given business?

This is more of an issue when you’re looking at sole traders and smaller businesses, as the impact of 1 person has not been diluted heavily by their workforce in effort or time. Either way, you’d assume laws would focus around a strong living minimum wage for each employee, and a profit or ownership share relative to the workers impact to the business. If the dishwasher enables you to generate 30% more profit – profit you can not generate without them – they should probably get a share beyond the bare minimum, no? That share should incentivise them to contribute, and disincentivise laziness. But also that share should obviously not be so large as to disincentivise you from hiring a dishwasher to begin with, nor another baker. Economies of scale are critical to achieving efficiency, abundance, and post scarcity. You’d also expect the bakers impact on the business to be larger than the dishwasher, so their profit share to be greater.

This issue is not nearly as difficult to grasp when you get to businesses with dozens to thousands of employees – they are literally dependent on, and can not exist, without their workers (many of which may have had greater contributions than themselves) – and the founder(s) own efforts and contributions to the business have been heavily diluted over time.

I’d suggest digging into how existing worker cooperatives are governed and were initially established https://en.wikipedia.org/wiki/Worker_cooperative#Worker_cooperatives_by_country

As long as you’re not an awful boss, you don’t have to worry about being booted out.

While the peoples who work with you can fire you, they can’t do it just because they feel like it. Under socialism, businesses don’t have the right to fire their workers at will like they do under capitalism, they need to have a good reason to fire you.

Under socialism there will be governmental bodies who’s task will be to monitor worker’s right, including making sure that layoffs are lawful. If you do get booted out by your coworkers, these governmental bodies will have to be notified by the business and review the justification for letting you go, and if they find that the reasons are not good enough, they have the power to force the business to give you back your position and issue penalties for unlawful layoff to the persons responsible. So just don’t be the kind of boss we hear about in r/prorevenge and r/maliciouscomplience and you’ll be fine.

Well there are always going to be drawbacks.

You want to serve more customers? Great! But you need help. Have a probationary period to make sure you and this other person aren’t antagonistic, then they have the same voting rights as you

Compensation is determined collectively. Maybe you have a base pay plus you both earn a bonus from the profits. Many options.

Unlike under capitalism, moving beyond capitalism means you only get paid for the work you do. Setting up a business brings no value to anyone but you, so you pay yourself with income potential.