Service Rates Policy

1. PURPOSE AND SCOPE

This policy establishes the service rates for the organization. These policies apply to all members and non-members of The Erefugia Cooperative and may be amended by resolution of the Board of Directors, provided such amendments are consistent with the Bylaws and Vermont cooperative law.

2. AUTOMATION AND ARTIFICIAL INTELLIGENCE (AI) POLICY

2.1. Purpose

The Cooperative recognizes the transformative potential of automation and artificial intelligence (AI) in enhancing efficiency, reducing needless toil, and streamlining processes. At the same time, we are deeply concerned by the social, economic, and ethical implications of technological deployment that seeks primarily to eliminate human involvement or employment. This policy defines the Cooperative’s stance on automation and AI in relation to service delivery, rate setting, and our broader mission of community well-being.

2.2. Principles

2.2.1. Human-Centered Technology

The Cooperative supports the thoughtful use of automation and AI as tools to assist and empower worker–members, not replace them. We embrace technologies that:

• Reduce unnecessary administrative or repetitive burdens;

• Improve accessibility and service quality;

• Enhance human creativity, judgment, and collaboration.

2.2.2. Concern for Displacement and Economic Justice

We oppose the use of automation or AI with the primary intent of reducing human headcount or displacing workers to increase profit margins. Such practices often externalize harm by:

• Reducing contributions to payroll and social security tax systems, weakening public safety nets;

• Concentrating wealth and decision-making power among owners and “automators”;

• Undermining community stability, local employment, and cooperative economies.

2.2.3. Social Contribution and Fiscal Responsibility

From an economic perspective, the Cooperative recognizes that widespread automation without compensatory mechanisms—such as universal basic income or universal benefits systems—creates a fiscal imbalance. When labor contributions are replaced by machines, the revenues that sustain shared infrastructure (including social security, Medicare, and community services) are diminished.

2.2.4. Operational Guidelines

The Cooperative prioritizes projects and services that use automation and AI to augment human capacity rather than replace it. We encourage clients to adopt human-in-the-loop design principles and to commit to workforce upskilling where feasible.

2.2.5. Service Rate Adjustment for Automation Projects

To align our pricing model with our mission values, the Cooperative reserves the right to apply rate surcharges for projects meeting any of the following conditions:

• The project’s principal purpose is to reduce human employment or eliminate worker positions;

• The client is a for-profit, non-member organization deriving significant revenue from automation technologies;

• The requested service would result in measurable decreases in payroll or social security contributions.

These additional revenues will be directed to the Human Service Division and other Cooperative programs dedicated to workforce development, social welfare, and community resilience.

2.2.6. Ethical Review Process

All projects involving automation, AI, or algorithmic decision-making will be reviewed by the Technology and Ethics Committee (or equivalent body), which may:

• Assess the potential social and economic impacts;

• Recommend adjustments to project scope or pricing;

• Decline participation in projects determined to be contrary to the Cooperative’s principles or mission.

2.2.7. Commitment to Ongoing Dialogue

The Cooperative will continually reassess its approach to automation and AI as technologies, social policies, and economic conditions evolve. We will advocate for structural solutions, such as universal benefits, cooperative automation models, and collective data ownership, that enable technology to serve humanity equitably.

3. SERVICE RATES AND PRICING STRUCTURE

3.1. Purpose and Principles

The Cooperative’s service rates are designed to balance fair compensation, mission alignment, and financial sustainability. This policy ensures that all services provided by worker–members are compensated equitably while reflecting the Cooperative’s commitment to accessibility, solidarity, and responsible economic practice.

Rates are determined through a transparent formula that accounts for the type of service provided, the relationship of the service recipient to the Cooperative, and the experience level of the worker–member performing the work.

3.2. Rate Formula

All service rates are calculated according to the following formula:

Hourly Rate = (Base Livable Wage) × (Membership Relationship Modifier) × (Service Type Modifier) × (Worker Level Modifier) x (Automation and AI Modifier)

3.3. Components

3.3.1. Base Livable Wage

The benchmark rate for all calculations is the national average livable wage for an individual with no children in the United States, as published annually by the World Population Review or a substantially similar data source designated by the Board of Directors. This rate is reviewed annually by the Board and adjusted as needed to reflect updated cost-of-living data.

3.3.2. Membership Relationship Modifier

Reflects the Cooperative’s mission priorities and target margin for each class of service recipient.

• Individual Member = 1.0

• Organizational Member = 1.1

• Individual Ally = 1.3

• Organizational Ally = 1.3

• Individual Non-Member = 1.7

• Organizational Non-Member = 2.0

From a mission perspective, the Cooperative prioritizes members and allies first; however, work for non-members, especially for-profit organizations, provides an important revenue stream that sustains community programs and worker stability.

3.3.3. Service Type Modifier

Adjusts for the specialization, risk, and resource requirements of each type of service. These categories are defined and updated periodically by the Service Delivery Committee. Example modifiers include:

• Human Services = 1.0

• Artistic Services = 1.2

• Technical Services = 1.5

• Organizational Services = 1.7

• High-Liability Services = 2.0

3.3.4. Worker–Member Level Modifier

Reflects experience, skill, and contribution to the Cooperative.

• Apprentice = 1.0

• Artisan = 1.5

• Luminary = 2.0

3.3.5. Automation and AI Modifier

This modifier reflects the extent to which a project uses automation or AI to reduce human labor. Its purpose is to distinguish between:

• Projects that streamline or support human work (e.g., reducing tedious tasks, improving efficiency), which are encouraged and carry a normal modifier (1.0).

• Projects that replace or reduce the need for human labor entirely, particularly in for-profit non-member contexts, which may have higher modifiers (e.g., 1.5 to 2.0) to ensure the Cooperative retains sufficient revenue to support human services and community programs.

Example modifiers:

• None / Supportive automation = 1.0

• Reduce effort hours (streamlining, not headcount) = 1.5

• Reduce headcount / replace labor entirely = 2.0

This approach ensures that automation supports rather than undermines the Cooperative’s mission, preserves fair labor contribution, and maintains economic sustainability for community-focused work.

3.3.6. Periodic Review and Adjustments

All components of the Service Rate Formula, including base wage and modifiers, shall be reviewed at least annually by the Finance and Service Delivery Committees, and may be updated by resolution of the Board of Directors, subject to member input and ratification where required.

3.3.7. Transparency and Accessibility

A current schedule of service rates and example calculations will be maintained in the Cooperative’s shared documentation portal and made accessible to all worker–members and service recipients. This ensures clarity, accountability, and equitable understanding of how Cooperative labor is valued.