PROFIT-SHARING. 



671 



left to shift for themselves. There are many 

 .mil shoe co-operative companies which 

 ha\e met with grent success. Co-operative 

 creamerit -s were established because fanners 

 Med by middlemen, and in self-defense 

 they pooled their dairv products and turned out 

 batter and cheese. They have that special ad- 

 vantage which a limited production gives. So 

 far the companies give no share of profits in 

 proportion to waives. When profit-sharing and 

 wages are considered together the matter is 

 more complex. The Lynn Knight of Labor Co- 

 operative Hoot and Shoe Company, now three 

 years old, marks the newer movement. In 1887 

 it had a capital of $9,000. It sells its goods in 

 part to the Knights of Labor, but as it makes 

 excellent goods, its wares are in fair demand. 

 Profits are divided in this way: Ten per cent, 

 goes to a sinking fund; 5 per cent, interest is 

 paid on capital stock ; 10 per cent, of the re- 

 mainder goes to the Knights of Labor Associa- 

 tion for a co-operative fund to be used in assist- 

 ing co-operative enterprises ; 45 per cent, is to 

 go to capital ; and 45 percent, to labor in propor- 

 tion to wages. The Cushman Shoe Factory, at 

 Auburn, Me., has recently distributed 4 per 

 cent, upon wages earned. The business was 

 larger by $150,000 under the profit-sharing sys- 

 tem than ever before. This was the result of 

 the interest taken by the workers, as is best de- 

 scribed in the report of their committee : 



How much could you contribute to the profits of 

 the business ? You "had provided for the firm, now 

 what was to be done to insure you a good profit ? 

 Kvery cent's worth of waste lessened your profit, every 

 ct nt saved increased it. Every mite of poor work 

 returned (and there has been a good deal the past 

 veun lias been the diminishing of your dividend. 

 The dividend might have been 1 per cent, more if we 

 had all realized just how much rested with us. We 

 have seen, time and again, 10 cents wasted by one 

 in a day. " Oh, that is nothing," you say. Well, 

 it' every one of the 700 or 800 wastes that amount in 

 a day, is that anything ? Of course this does not hap- 

 p-n. l>utyou can all see how a mite from all would 

 count up big at the end of the year. 



One of the largest granite quarries in the Unit- 

 ed States, at Westerly, has made a profitable ar- 

 rangement of this sort : It was agreed that at 

 the end of the year the net income should be di- 

 vided into three equal parts one for the laborers, 

 one for the company, and one for a reserve fund. 

 The labor dividend should be paid annually, 

 and before the dividend to capital. No officer, 

 o\vr-eer. clerk, or subcontractor should share in 

 the dividend. The true value of all labor con- 

 tributed should be determined by the amounts 

 earned and credited to each workman as wages 

 for labor performed during the year. Accounts 

 should be examined by auditors mutually agreed 

 upon, and laborers arbitrarily discharged or 

 necessarily deprived of work should not be de- 

 barred fro-n receiving their share of the dividend. 

 Disagreements should be settled by arbitration, 

 and a bill of prices should be agreed upon on or 

 before Jan. 1 of each year. No reduction of 

 wages should be made to affect any contract on 

 hand ; and in case of an increase of rates on any 

 contract, the difference might be adjusted in 

 makine up the dividend. A firm of clothiers in 

 New York city explained its plan to its employes 

 in this way : 



The purpose is to set aaide a certain percentage of 



our net gum as ascertained itt the end of the year. 

 mill with that sum dfchirc a dividend upon tin; total 

 umoimt of wugt* paid to th<m who work under our 

 own roof. Whoever has earned even HO much as a 

 week's wugc'H, will purtk'iputf, provided ho or ihe 

 was not discharged for cause. Lpon the basis of our 

 last year's business you would have received nearly 5 

 per cent, upon the total of your v ear's earnings. In 

 other words, the man who drew $*20 a week, or $1,040 

 during the year, would have had a check for nearly 

 $50. 



John Wanamaker, of Philadelphia, recently 

 issued a circular declaring that all who have 

 been in the employ of the house for seven years, 

 and those whose term of service shall hereafter 

 reach that length of time, are to participate in 

 the profits of the business. All employes who 

 do not come in the seven year class are to have 

 added to their regular salaries a sum each week 

 graded by their sales. In the clerical, packing, 

 invoice, and various offices, a civil-service system 

 is to be strictly followed in making promotions 

 and advancements. The record of each person 

 in the employ of the house will be carefully kept, 

 and will govern all changes. There will also 

 be a special honor list, " for the more rapid 

 perferment of those showing marked business 

 ability, rapid improvement, diligence, economy, 

 and usefulness." The distribution for the first 

 year was $109,439.68. The employes of the 

 store were called together at the expiration of 

 the second year in May, 1889. At that time 

 $46,082.29 was paid, which, added to $58,263.29 

 already paid, made a total of $104,345.68. The 

 following statement was made by the proprietor : 



In two years we have paid the usual salaries, and 

 exactly $213,785.39 more by this free-will distribution. 

 Not one person, to the best of my knowledge and be- 

 lief, would have had any larger salary hud this plan of 

 distribution not been in force. So that it is out of our 

 pockets into yours, and without any obligation on our 

 part except good will and interest in the welfare of 

 our good people. Under a system of monthly exam- 

 inations of individual records, all our clerks h'ave had 

 proper consideration according to merit, and perhaps 

 a few salaries have been reduced as above value of 

 services, while many have been advanced without 

 solicitation. This is the present and future policy of 

 the house. The checks given out to-night might 

 all have been larger, and it is a disappointment to me 

 that they are not. You have it in your power, 

 by your enthusiastic and earnest efforts, to increase 

 or diminish what the firm has set aside for this 

 distribution. I wish to do two things by this 

 plan : 1st, to give actual proof of heartfelt interest to 

 our people ; 2a, to solidify the people into one mighty 

 and perfect force, to increase the business for the 

 benefit of themselves and their employers. 



In May, 1889, the Bourne Mills corporation of 

 Fall River, Mass., adopted a plan to provide 

 sharing with its employes. It was proposed that 

 every man, woman, and child continuing in the 

 employ of the company from July, 1889, to 

 January, 1890, should receive some share of the 

 profits, to be paid in cash on Feb. 10, 1890, in 

 proportion to the wages earned for the whole six 

 months; and that the total amount divided 

 shall not be less than 6 per cent, of the amount 

 of cash dividends declared and paid to the 

 stockholders during the same time. The only 

 condition was faithful and continuous service, 

 except on account of sickness or any other suffi- 

 cient reason. 



