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Financial Participation

According to the results of the European Working Conditions Survey Slovakia is in the top third of European countries with regard to the incidence of workers’ participation schemes (employee share ownership and profit-sharing). In particular this study finds that forms of profit-sharing are relatively widespread in Slovakia. The European Company Survey, by contrast, finds a below-average incidence of employee share ownership in Slovakia.

Between 1991 and 1993 about 7,472 enterprises were privatized in Slovakia. By the end of 1993 about 1,050 enterprise were still state-owned, by 1995 1,030. This figure decreased constantly during the following years, with a significant decrease between 1995 and 1997 (from 1,030 to 203). By the end of 2004, there were 35 state enterprises left in Slovakia and thus the privatisation process was largely at an end.

Share ownership

Before the break-up of Czechoslovakia, the legal framework of privatization allowed employees to acquire shares in the enterprises where they were employed. Despite this favourable legislation, this very seldom took place. It was mainly due to the fact that, just as in the Czech Republic, the selling price of the shares was based upon a book value of the assets which was too high for employees. This led to a very low percentage of employee participation after the first privatization wave, with only 1.5% of all shares being acquired by employees.

For a short period of time between 1995 and 1996, insider privatization, in the form of MEBOs, was promoted. This method was used in those years for about 83% of the companies to be privatized. The enterprises were sold at a low price with management holding more than 50% of the shares.1

According to the “European Company Survey” (ECS), a survey of more than 27,000 HR managers in Europe conducted in 2009, around 2% of private-sector Slovak companies with 10 or more employees offer their employees an employee share ownership scheme, well under the European average of around 5%.2

The results of the European Working Conditions Survey (EWCS 2010), based on a questionnaire of employees, show that the incidence of employee share ownership schemes in Slovakia is 3.2%.3 The Annual Economic Survey of Employee Ownership in European Countries in 2012 finds that 33.3% of the largest companies in the country have broad-based (employee share ownership) participation schemes for the whole workforce. This is below the European average (53.3%).4

For the CRANET study 2011 HR managers in 29 countries were questioned about the incidence of workers’ financial participation in their companies. The study found that there are profit-sharing schemes in 20% of Slovakian companies.5 This value is significantly below the average of the countries investigated.

Profit-Sharing

According to the results of the “European Company Survey“ (2009), 17% of private-sector Slovak companies with 10 or more employees offer their employees a profit-sharing scheme. Compared with other European countries, this is a slightly above-average figure (the 30-country European average is 14%). The prevalence of employee profit-sharing schemes in Slovakia rises slightly in line with company size. 17% of companies with 10-49 employees, 18% with 50-199 employees, and 22% of companies with more than 200 employees have a profit-sharing scheme.6

According to the results of the European Working Conditions Survey (EWCS 2010), based on a survey of employees, the incidence of profit-sharing schemes in Slovakia is 21.4%.7 This is very high by European comparison. In the literature this very high value has been called into question and explained by methodological errors in the European Working Conditions Survey.8 However, the European Company Survey (2009) also finds a value above the European average for Slovakia.

Cooperatives

Back in 1993, cooperatives accounted for about 9% of the total number of firms in the Slovak economy – some 1,922 cooperatives.9 Most of them were active in the agricultural sector with industrial cooperatives representing only a small percentage. Their number decreased dramatically in the following years, mainly as a result of the reform of the cooperative system. In 2004 there were about 1,564 registered cooperatives remaining, accounting for about 2% of all enterprises in Slovakia.10

Wilke, Maack and Partner (2014) Country reports on Financial Participation in Europe. Prepared for www.worker-participation.eu. Reports first published in 2007 and fully updated in 2014.