Nonstate Institutions:

Cooperatives and Trade Unions

Objectives
At the end of this lesson, you should be able to:
*define cooperatives and trade unions,
*explain the different types of cooperatives and
examples of trade unions,
*enumerate the purposes of organizing
cooperatives and trade unions, and
*discuss the functions of cooperatives and trade
unions as non-state institutions that promote
self-help among people in society.
Are there ways to improve the
predicament of many low-income
individuals who continually struggle to
meet their daily needs?

Do people have the power to improve

their lives through collective efforts?

Is social justice attainable in this

country?
Review!
Non-state Institutions
Non-state institutions refer to systems that are organized by
private individuals or groups of people for the purpose of
providing services to members of society. The government
does not control these institutions, but they are regulated by
laws and statutes of the state.

Non-state institutions play vital roles in the economy because

they are the ones providing the special needs of the people
that the government cannot easily give.
Two crucial non-state institutions promote self-help and self-
reliance among its members and at the same time give
leverage to people for development. These are
the cooperatives and trade unions.
Learn about it!

What are Cooperatives and Trade Unions?

A cooperative is a voluntary organization of

people who have agreed to pool their resources
together to undertake an economic enterprise
to meet their everyday needs. A cooperative is
something that they democratically manage,
control, and share the economic benefits by
participation and patronage (Cooperative
Development Authority, CDA).
Trade unions or labor unions are
voluntary associations of either
employees, employers, or
independent workers to protect
their interest and become an
instrument of defense against
exploitation and maltreatment.
The commonalities of these two non-
state institutions are the following:

*organized and formed by a group of

people to protect their interest,
*promotes the common good among
members, and
*voluntary in nature.
Following are the different
types of cooperatives.
Following are some examples of
trade unions.
The Differences Between
Cooperatives and Trade
Unions
As to the Purpose:
Learn about it!

Cooperatives and Trade Unions as Means of Promoting Self-

help Towards Economic Development

Cooperatives are self-help organizations presently utilized by

the government as more efficient tools for economic
development. These are also business enterprises which
affiliates own, manage, and control following accepted
democratic principles. Members are not organized primarily
for profit nor to serve other persons, but to address the needs
of their members. Memberships in cooperatives are voluntary
and open to all those who need their services. Members
share economic benefits from unions in proportion to the
individual member's patronage of the business or enterprise.
Trade unions are always fighting for better wages by
improving employees pay and other benefits such as
holiday entitlements.

Functions:
Secure improvements in employees' working
conditions, including hours of work, health or safety
at work, improving pensions, and industry injury
benefits.
Provide improved standards of living.
Safeguard the interest of workers by encouraging
firms to increase employee participation in decision-
making.
Prevent employees from exploitation.
With trade union on a place,
strikes can be avoided, thus
resulting in stability and growth
of the firm. This promotes unity,
spirit of self-reliance, and self-
respect, and may lead to
economic development.
Explore!

Imagine a construction worker earning

minimum wage with no additional
benefits from the employer, no
security of tenure from his work, and
can be terminated any time of the day.
What can cooperatives and trade
unions do to improve his condition?
Try it!

Now, you are aware that cooperatives and

trade unions are vital institutions in the
economy that foster self-help and self-
reliance. Soon, if given a chance, what role
do you prefer to play, an employee or an
employer? Why? How would you promote
the importance of cooperatives and trade
unions?
What do you think?
We are aware that different kinds of
cooperatives and trade unions were
organized and formed in various parts of the
country, but still, some of their members are
struggling every day to meet their needs.
What do you think is the reason why most
cooperatives and trade unions failed in
fulfilling their functions? Are there external
factors that contribute to their failure? What
do you think are these factors?
Keypoints
Non-state institutions refer to institutions that are organized
by private individuals or groups of people for the purpose of
providing services to the members of society.
A cooperative is a voluntary organization of persons who have
agreed to pool their resources together to undertake an
economic enterprise to meet their everyday needs.
A trade union is a voluntary association of employees,
employers, or independent workers to protect their interest.
The different types of cooperatives
are consumer, credit, producer, marketing, and service.
Examples of trade unions are transport groups, workers
welfare organizations, and employers’ associations.
The functions and purposes of organizing and establishing
cooperatives and trade unions are critical in promoting
economic development.
Nonstate Institutions: Transnational
Advocacy Groups