The center-left Partido Socialista (PSOE) Prime Minister Pedro Sánchez and his Second Deputy Prime Minister Yolanda Díaz of left-wing alliance Sumar can take credit for growing employment and rising wages, allowing them to buck wider European trends.
The horizon for Spain’s left remains more radical and egalitarian than social-democratic advance in an age of neoliberalism, however. The latest evidence is a new report commissioned by Díaz’s ministry, Two Promises to Those Who Work: Voice and Ownership, drawn up by an international commission of experts to chart how Spain might finally make good on a long-dormant constitutional mandate to extend democracy into the workplace. The proposals envision worker representation on company boards and broader collective access to ownership—ideas that represent the kind of structural reordering of economic life that distinguishes Sumar’s politics from those of its larger coalition partner.
Following a recent visit to New York, Díaz spoke with The Nation’s Bhaskar Sunkara, Gabriel Hetland, and Gianpaolo Baiocchi about the case for workplace democracy, the lessons of Spain’s recent labor reforms, and the political work of pushing a coalition partner left.
—Bhaskar Sunkara
The Nation: The Spanish government recently convened an international commission to explore how to expand democracy into the workplace. What vision of workplace democracy motivated the creation of this initiative?
Yolanda Díaz: Our conviction is clear: Democracy cannot stop at the door of the workplace. We live in societies that celebrate civic participation in every area of public life, yet accept without question that once people cross the threshold into work, they lose their voice. That is a contradiction no advanced democracy should be able to sustain indefinitely.
The commission was created to confront that contradiction. It has a strong academic character, but it will lead to a political and democratic transformation of the entire country. We want to identify the concrete mechanisms that allow workers to participate in the decisions that affect their lives—from working conditions to the strategic direction of companies. And we want to anchor that debate in Spain’s own reality, in our constitutional history and in the best international experiences available.
The vision that drives us is of an economy where work is not just a factor of production, but the very center of democratic life.
The Nation: The commission’s report discusses ideas such as worker representation on company boards and collective equity-sharing mechanisms. Why do you see workplace democracy as the next frontier of labor rights in advanced economies?
YD: Our conviction is clear: Democracy cannot stop at the door of the workplace. We live in societies that celebrate civic participation in every area of public life, yet accept without question that once people cross the threshold into work, they lose their voice. That is a contradiction no advanced democracy should be able to sustain indefinitely.
Because it is the logical next step. We have spent decades building labor rights around the individual employment relationship—wages, working hours, safety, non-discrimination. All of that was essential, and the fight is not over. But there is a dimension of power in the workplace that those rights alone cannot address: who decides the direction of the company, who controls its resources, who sets its priorities.
In all advanced democracies, we have accepted that citizens should have a say in how they are governed. We have not extended that logic to the economy. And that gap is becoming unsustainable—not just morally, but politically. The rise of authoritarian populism feeds on precisely that sense of powerlessness: people feel that the decisions that shape their lives are made without them, and often against them. Workplace democracy is one of the structural answers to that crisis.
The Nation: The initiative is intended in part to fulfill Article 129.2 of Spain’s 1978 Constitution. Could you briefly explain what that provision says and why it remains so relevant today? And beyond Spain’s constitutional framework, what intellectual or international influences have shaped the commission’s work?
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“swipe left below to view more authors”Swipe →YD: Article 129.2 of Spain’s Constitution establishes that public authorities shall promote the various forms of participation within companies. It was written into the Constitution in 1978, in the context of the democratic transition, as a commitment that the new democracy would not limit itself to the political sphere but would extend into economic life.
It has remained largely unfulfilled for almost 50 years. That is the honest truth. And that is precisely why this commission matters: It is an attempt to finally honor a constitutional mandate that successive governments have left dormant.
Beyond Spain, the commission’s work draws on the European tradition of codetermination—particularly the German and Scandinavian models—on the academic literature around employee ownership and economic democracy, and on the International Labor Organization’s work on decent work and social economy. We are also informed by contemporary debates in the United States and the United Kingdom around inclusive ownership funds and stakeholder capitalism.
The Nation: The commission’s proposals focus on two related goals: expanding workers’ voice in firm governance and broadening workers’ access to ownership. How do you see these two elements fitting together? Spain also has a long history of cooperative and worker-managed enterprises, most famously the Mondragon Corporation. To what extent do those experiences inform the approach the commission is taking? Are there particular lessons—positive or negative—from earlier models of worker ownership and management?
YD: We start from the understanding that voice and ownership are two sides of the same coin, and historical experience shows that when they are separated, both are weakened.
A worker who has an economic stake but no influence over decisions is at the mercy of shareholder majorities who are often far removed from the reality of the company. And a board representative without a constituency of workers with a real material stake in the company ends up a symbolic presence. The commitment has to be integral. Those who know a company best are the people who make it productive: its workers. And they must have real power.
Mondragon is perhaps the best-known example internationally, but it is only one part of a much broader ecosystem: Spain’s social economy, which spans every economic sector and goes well beyond the cooperative movement.
The most important lesson we draw from that entire tradition—cooperatives, labor companies, European codetermination—is that worker participation in companies is not an obstacle to efficiency. It is a competitive advantage. Companies with greater worker involvement make better long-term decisions, have lower turnover, more innovation and greater stability.
Democracy is good for everyone. Only a minority that has a great deal to lose when the majority decides rejects it.
The Nation: Who are the key actors pushing this agenda forward? What role are trade unions, the governing Spanish Socialist Workers’ Party, and your political organization Sumar playing in advancing these ideas? More broadly, how do you think about the relationship between social mobilization outside the state and legislative negotiations within the governing coalition?
YD: Trade unions are central actors. CCOO [the Workers’ Commissions, the largest trade union in Spain] and UGT [the General Union of Workers, the second largest trade union] have been fundamental interlocutors in the design of this agenda.
Within the coalition government, Sumar has been the political engine of this initiative. The major debates happening in Spain are driven by Sumar. The reduction of the working week, the Universal Child Benefit, intervention in the housing market… It is part of our DNA to open new ideas and better possibilities, even if that sometimes makes things harder for our coalition partner. Coalitions require negotiation, and we negotiate from a position of clarity about our own positions.
On the relationship between social mobilization and legislation: I cannot conceive of any lasting structural reform that does not have roots in society. Laws without a social movement behind them are fragile, and social movements without legislative translation eventually exhaust themselves. My experience as a minister has confirmed something I already knew as a labor lawyer: Rights are won, then defended—and to defend them, they must have been built together with people.
The relationship between movement and institution is not sequential—first the movement, then the law. It is simultaneous and mutually reinforcing. The labor reform was possible because unions had been building the argument for years. The working week reduction is advancing because there is a broad social consensus behind it. The commission on workplace democracy was created because there is an intellectual and social demand for it.
Within the coalition, the tension is real but productive. The PSOE [the Socialist Party] governs with us because the electoral arithmetic requires it, and because there are shared commitments. But Sumar’s role is to push the frontier of what is politically possible, not to administer the status quo. That is a deliberate choice.
The Nation: What kinds of opposition have these proposals faced? Have business groups or other political forces raised concerns, and if so, what form has that opposition taken? How has private capital reacted to the initiative?
YD: The opposition exists and is predictable. Part of the business community has reacted with the usual arguments: that this will create legal uncertainty, complicate management, deter investment. These are the same arguments we heard when we raised the minimum wage, when we passed the labor reform. And in every one of those cases, reality and time proved us right.
The political right—the PP [the People’s Party] and Vox—systematically opposes any reform that alters the balance of power in economic relations. For them, democracy ends where the interests of capital begin. They are not part of anything that would improve people’s lives even marginally. The right wins votes from citizens but defends the interests only of the wealthy.
What I find most relevant, however, is that part of the business world is listening. There are sectors—especially in the social economy and in medium-sized companies with a culture of participation—that see these proposals as an opportunity rather than a threat. I say this because the business community is very diverse and there are sensible voices within it. The debate is not as monolithic as it is sometimes presented. And that gives us room to move forward.
The Nation: In recent years Spain has enacted a series of major labor reforms. The minimum wage has increased by roughly 66 percent—from 736 euros in 2018 to 1,221 euros today—and your government’s labor reform significantly reduced temporary employment, cutting the share of temporary contracts from 30 percent to roughly 12 percent. In the United States, critics often argue that higher minimum wages and stronger labor protections destroy jobs. What actually happened to employment in Spain following these reforms, and what lessons might policymakers elsewhere draw from that experience?
YD: What happened is that liberal economic theory had been wrong for decades, and we proved it. Spain has reached historic levels of Social Security affiliation: 22 million contributors. Never seen before. And at the same time, we have reduced the structural precariousness that had made Spain the country in Europe with the highest rate of temporary employment.
We used to be an exception in Europe—people looked at us with embarrassment. Now they look at us with a healthy envy. In every previous crisis, the manual said: lay people off and cut. Now the approach is: protect and expand rights.
This is the empirical confirmation of something we had been pointing out for decades: In labor markets with power imbalances, regulation does not destroy jobs—it redistributes and dignifies them. Now that we have had power, we have carried out those reforms, and it turns out we were right.
The 2021 labor reform was especially important because it attacked the root of the problem: the proliferation of temporary contracts as an ordinary management strategy, not as a response to genuine needs for temporary work. By restricting that avenue, we obliged companies to recognize the stable nature of many jobs that had been concealed behind the facade of temporariness.
There used to be a recurring phrase in Spain during economic booms: that Spain was doing well ‘in spite of’ its labor market—the economy grew, but so did poor-quality jobs. Now it is the opposite: Spain is growing faster than any country in the eurozone thanks to its labor market. That is something to be proud of.
The Nation: What did the debate look like in Spain at the time? Were similar warnings about job losses made, and how did the political coalition behind the reforms respond to those arguments?
YD: Identical. The same warnings, almost word for word. The employers’ associations and the political right predicted the seven plagues of Egypt. The pressure was enormous. There were moments of intense negotiation, of threats, of temptations to water down the scope of the reforms. But we held firm.
What we learned is that in labor reform politics, you have to be able to withstand the noise of the short term in order to harvest the results of the medium term.
The Nation: Your commission is rooted in Spain’s constitutional framework and political moment. But many democracies are grappling with rising inequality and declining worker power. What elements of the “democracy at work” agenda do you think could be relevant beyond Spain?
YD: The crisis of democracy that we are experiencing in many countries has an economic dimension that we often undervalue in political debate. When people feel they have no power over the material conditions of their lives—their work, their wages, their housing—they end up distrusting political institutions as well. Right-wing authoritarianism and populism feed on precisely that disconnection. Democracy at work is not just a labor issue; it is a response to that crisis.
The elements I believe are most transferable are, first, the recognition that worker participation in company governance is not incompatible with competitiveness. Second, the idea that collective access to ownership is a highly effective redistribution tool. And third, that these changes require clear legal frameworks: voluntarism is not sufficient when power imbalances are so deep. Each country will have to build its own path, but the direction is universally valid: democracies that want to survive the inequality of the twenty-first century will have to reach the workplace. Democracy at work is not an ideological option. It is a democratic necessity.
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