Bill Text: NJ S1157 | 2018-2019 | Regular Session | Introduced
Bill Title: Concerns workers' cooperative societies.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2018-01-25 - Introduced in the Senate, Referred to Senate Labor Committee [S1157 Detail]
Download: New_Jersey-2018-S1157-Introduced.html
Sponsored by:
Senator NILSA CRUZ-PEREZ
District 5 (Camden and Gloucester)
SYNOPSIS
Concerns workers' cooperative societies.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning workers' cooperative societies, and amending and supplementing Title 34 of the Revised Statutes.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. R.S.34:17-1 is amended to read as follows:
34:17-1. Any seven or more persons, residents in this [state] State, may associate themselves into a society for the purpose of carrying on any lawful mechanical, mining, manufacturing, service or trading business, or of trading and dealing in goods, wares and merchandise or chattels, or of buying, selling, mortgaging, settling, owning, leasing and improving real estate and erecting buildings thereon, within this [state] State, upon making and filing a certificate of association in writing, in the manner hereinafter provided.
(cf: R.S.34:17-1)
2. R.S.34:17-3 is amended to read as follows:
34:17-3. Such certificate shall be signed by the persons originally associating themselves together, shall be proved or acknowledged by at least seven of them before an officer qualified to take acknowledgments of deeds of real estate, and after being approved by the [commissioner of labor] Commissioner of Labor and Workforce Development, shall be recorded in the office of the clerk of the county where the principal office or place of business of the society shall be located and a copy thereof shall be filed in the office of the commissioner [of labor]. Thereupon the persons so associating shall be deemed to be a body corporate with all the powers incident thereto.
(cf: R.S.34:17-3)
3. R.S.34:17-4 is amended to read as follows:
34:17-4. The first meeting of such society shall be called by a notice signed by a majority of the persons named in the certificate of association, designating the time, place and purpose of the meeting, and shall be personally served on all persons signing the certificate, or by [advertisement in a newspaper published in the county where the society shall have been incorporated, if such personal service cannot be made] certified or registered mail with proof of delivery.
At such meeting or at any adjourned meeting thereof, a majority of the persons so signing shall constitute a quorum for the transaction of business and may elect the directors and other officers as hereafter provided, and may adopt by-laws, rules and regulations for the government of the society.
(cf: R.S.34:17-4)
4. R.S.34:17-8 is amended to read as follows:
34:17-8. Every such society shall have a registered office to which all communications and notices may be addressed. Notices in writing of the location of such office, and of any change therein, shall be filed with the [commissioner of labor] Commissioner of Labor and Workforce Development, and in the office of the clerk of the county where the office of the society is located.
(cf: R.S.34:17-8)
5. R.S.34:17-9 is amended to read as follows:
34:17-9. The capital stock of such society shall be divided into shares [the par value of which shall not be more than fifty dollars,] and no share shall be issued for less than its par value. No certificate of shares shall be issued to any member until his shares are fully paid up.
(cf: R.S.34:17-9)
6. R.S.34:17-12 is amended to read as follows:
34:17-12. The board of directors of every society incorporated under this chapter shall annually make a statement in writing of the condition of such society, setting forth:
a. The amount of capital stock and the number and par value of shares issued;
b. The number of stockholders and the number of shares held by each; and
c. The amount and character of the property of the society and of its debts and liabilities.
Such statement shall be signed and sworn to by a majority of directors, including the treasurer, and filed in the office of the clerk of the county where the principal office of the society is located, and immediately thereafter a copy of such statement shall be forwarded to the [commissioner of labor] Commissioner of Labor and Workforce Development. If the commissioner [of labor] shall have reason to doubt the correctness of the statement, or upon the written request of five members of the society, [he] the commissioner shall cause an examination of the books and affairs of the society to be made and shall render a correct statement to the members thereof. Every member or creditor thereof shall be entitled to receive from the secretary of the society a copy of the annual statement, and every director or other officer refusing to comply with the requirements of this section, or making and signing a false annual statement of the condition of the society, shall [forfeit for each offense the sum of one hundred dollars, to be recovered in an action at law in any court of competent jurisdiction in this state by] , in addition to any other civil or criminal sanctions or penalties established by law for falsification of business records, be subject to removal by either the board of directors, or by the members of the society, at a regular or special meeting, and shall be liable to the society and to any member or creditor of the society [who shall sue for the same] for any loss or damage arising from such refusal to comply or making or signing of a false statement of the condition of the society.
(cf: R.S.34:17-12)
7. R.S.34:17-14 is amended to read as follows:
34:17-14. There shall be such distribution of the profits of such society among the [workmen] workers, purchasers and members as shall be prescribed in the certificate of association, at such times as therein prescribed, as often at least as once in twelve months, but no such distribution shall be made until a sum equal to five per cent of the net profits shall have been appropriated for a contingent or sinking fund and such appropriation shall continue to be made until there shall be accumulated a sum equal to thirty per cent of the capital stock of such society.
(cf: R.S.34:17-14)
8. R.S.34:17-15 is amended to read as follows:
34:17-15. Any member of such society, by a writing under his hand, delivered at the office of the society, may nominate any person [, being the husband, wife, father, mother, child, brother, sister, nephew or niece or other relative of such member,] to whom his shares of the capital stock of the society shall be transferred at his decease, and from time to time may revoke or vary such nomination by a writing similarly delivered.
The society shall keep a book, wherein the names of all persons so nominated, and the number of shares to be transferred shall be recorded, but in lieu of making such transfer, the society may provide for the payment to all such nominees of the full value of shares intended to be transferred.
If by the by-laws of the society the shares are transferable, this section shall not be construed to forbid the transfer of such shares by sale or will or otherwise, subject to the consent of the board of directors.
(cf: R.S.34:17-15)
9. R.S.34:17-18 is amended to read as follows:
34:17-18. Any society formed
pursuant to this chapter may be dissolved in the manner provided by [section
14:13-1 of the title Corporations, General]
N.J.S.14A:12-1, except that any certificate required by that section to be
filed with the Secretary of State shall
instead be filed with the Commissioner of Labor and Workforce Development.
(cf: R.S.34:17-18)
10. (New section) The New Jersey Economic Development Authority, in consultation with the Department of Labor and Workforce Development, shall provide financial and technical assistance to cooperative societies formed under R.S.34:17-1 et seq. in the same manner, and to the same extent, and subject to the same standards and requirements, as it does for other small businesses.
11. (New section) The Department of Labor and Workforce Development shall provide, on its Internet website and in publications providing information to persons seeking employment, information concerning cooperative societies established pursuant to R.S.34:17-1 et seq., for persons who might be interested in forming or joining such cooperative societies.
12. This act shall take effect on the 90th day following enactment.
STATEMENT
This bill amends and supplements statutory law authorizing the formation of workers' cooperative societies by adding services to the list of permissible purposes of a workers' cooperative society, and updating antiquated references. Additionally, the bill requires the New Jersey Economic Development Authority (EDA) to provide financial and technical assistance to workers' cooperative societies as provided to other small businesses in the State.
Workers' cooperative societies are a low-cost way to form small businesses for the mutual benefit of the employees. The New Jersey statute authorizing the formation of workers' cooperative societies was adopted in 1881. Although there are few organizations of this kind in existence today, nationally, interest in the formation of these organizations has grown in recent years.
This bill provides for the formation of a workers' cooperative society for the purpose of carrying on a service-related business. The bill also removes certain limitations on par value of shares and persons to whom shares can be transferred, and increases the penalty for malfeasance by members of the board of directors, or other officers and agents.
In addition, this bill updates antiquated statutory references, and, regarding the requirement that notice of the first society meeting be sent to members, replaces the option to notify members by publication, with an option to provide notice through certified or registered mail. Dissolution documents will no longer be filed with the Department of State; they will instead be filed with the Department of Labor and Workforce Development (DOLWD). The DOLWD shall also provide, on its website and in publications designed for those seeking employment, information regarding workers' cooperative societies which may be helpful to those seeking to form or join such an organization. Finally, the bill directs the EDA to provide the same technical and financial assistance to workers' cooperative societies as would be provided to any other small business in the State.
