552 SAMUEL CABOT. 



months, a certain fraction of the profits among the participants, strictly 

 in proportion to the wages of each during that period. This sum in 

 each case is divided into two equal parts, one of which is given in cash 

 to the employee and the other is deposited in a savings-bank by me as 

 his trustee. 



" This fund in the bank is in the nature of an insurance upon the 

 life of the employee, and is given over with interest to his executors, 

 if he dies. It, however, does not come back into my hands. If he 

 should, for instance, refuse to give me sixty days' notice on leaving 

 me, although he had already received an equal amount in cash upon 

 the promise to give me such notice, the money would not come back 

 to me, but would simply be distributed among the other participants 

 at the next division. 



" The same is true in case of his discharge for cause. 



" In case of sickness I am empowered at my discretion to draw upon 

 his fund, though in temporary cases I always put sick men on half- 

 pay for a considerable time without recourse to their fund. I also 

 have the right to lend him money upon it to build a house. And now 

 let me give you a few figures. 



" The system was begun a little over seventeen years ago, and has 

 gone on uninterrupted up to the present time. The profit-sharers at 

 the outset numbered 21, and to-day number 42. The total amount paid 

 out by me has been $40,464 during that period. Now the natural 

 question which you all will ask, I think, is. Has this been a good bar- 

 gain ? I thnik you will all agree that in the ultimate analysis no bar- 

 gain is a good bargain that is not profitable to both sides. Well, there 

 will, I think, be no dispute that from the workman's point of view the 

 bargain has been a good one, as he has a very considerable addition to 

 his wages, which were as high as other labor of the same kind ; and I 

 may say that the average wages have steadily advanced as the effi- 

 ciency and skill increased. 



" But now comes the question of my own investment : "What 

 means have I of knowing that the efficiency of the workmen has been 

 increased to an amount equivalent to the $40,464 which I have 

 exjiended 1 



" I will now give you a few more statistics which bear upon this 

 question. Let me remind you that the same proportion of the profit 

 was paid to the 21 men who first entered the agreement that is now 

 paid to the 42 men who compose the present corps. But now note this 

 very significant fact. While the first payments averaged about 10 per 

 cent upon the wages of each man, the last payment — which was larger 

 than usual, to be sure — was exactly 21-i% per cent of their wages. 



