PI||;fe:/|i:?l'::;H:;^^ Vl;:;;;;':;;,;;!;:;-:;:;..;. ;■,, |;.ii;,;;;!:K:-;i'i'!;';'-;r:.v:ir;' ifcv''':y''j:t::5't;''''!-^'-i--' '■ r-;' •,"::■[:' ;j:! ■ T f UNIVERSITY OF CALIFORNIA AT LOS ANGELES PROFIT-SHARING AND LABOUR CO PARTNERSHIP. MINISTRY OF LABOUR (INTELLIGENCE AND "~~^AflSTICS DEPARTMENT). I 'v REPORT '" L 1 B R A H / PROFIT-SHARING AND LABOUR CO-PARTNERSHIP IN THE UNITED KINGDOM. Presented to Parliament bv Command of His majesty. LONDON: PRINTED AND PUBLISHED bV HIS MAJES'lTS STATIONERY OFFICE. To be purchased throush anv Bookseller or directly from ■ H.M. STATIONERY OFFICE at the following addresses: Imperial House, Kingsway, London, VV.C.a, and 28, AiJiNGDON Street, London, S.W.I ; 37, Peter .-^treet, Manchester ; 1, St. ANDREW'S Crescent. Cardiff : 23, Forth street, Edinburgh ; ^ or trom B. PONSONBY, LTD., lib, GRAFioN STREET, DUBLIN 5 2 9 11 1920. [Cmd. 5i4.] Price Is. Net. GOVERNMENT PUBLICATIONS (with the under-mentioned exceptions) can bo purchancd in the manner indicated on the first pnge of this wrapi)er. Hydrofrraptaloal Publications of the Admiralty are sold by J. D. Pottru, li:.. MiiH.ri.R, Lou-loii. K.I. Patent Office Publications are nold at the Patent Office, 2'>, Southampton Buildings ( 'lirinccry Luih', Lmuloii, W.C.L'. Ordnance Survey mul Geologrical Survey Publications can be purchased iroin ih" I'lreotiT Gi'iieral of tlic Ordnance Survey, Southampton; from the Director, Ordnance Survey. Dublin; or from Agenis' in most of the Chief Towns in the United Kinjrdom. Tliey can also be ordered through any Bookseller. Small Scale Maps are on sale at the following Branches of H.M. Stationery Office : — 28, Abingdon Street, S.W. 1 37, Peter Street, Manchester ; 1. St. Andrew'.s Crescent, Cardiff ; and 2B, Eorth Strei Iv'inbiirgh, and all Railway Bookstalls. The Journal of the Board of Agrriculture and Fisheries is published monthly Ijy the Board, and is obtainable from 3, St. James's Square, London, S.W.I. Price (since Jan. 1, 11(20), fu!.. post free. I The following is a list of some recent Parliamentary and OBBcial Publications (All prices are net, and those in purp.iithe.^rs include postage) : — TRADE OF THE UNITED KINGDOM. | Annual Statement for 1918, compared with the Four preceding Years. Vol I. — Introduction. Alterations in the Annual Statement of Trade. Abstrac Tables showing Summary of Imports ; Summary of British, Irish, Foreign and Colonia Exports ; Classitication of the Articles included in the foregoing Summary Tables Imports from and Exports to Foreign Countries and British Possessions (including Protectorates) ; Gold and Silver Coin and Bullion, Total Value of Imports and Exports Detailed Statements of Imports from specified countries. Free and Subject to Duty, am of Dutiable Articles entered for Home Consumption. Detailed Statement of Export of Prrxluce and Manufactures of the United Kingdom ; and of Foreign and Colonic Merchandise, Free of and Subject to Duty on Importation. Gold and Silver Coin an Bullion, Imports from and Exports to each Country. Index. [Cmd. 342] of Session 1919. Price Is. {Is. 9(Z.) Vol. II. — Abstract and Detailed Tables relating i to Imports 'from and Exports i each Foreign Country and British Possession (including Protectorates), and Consigi ments and Value of Articles retained in the United Kingdom ; and similar Tables • Import9»and Exports at each Port or Place. The Gross Amount of Customs Reveni received at each Port of Collection, and from each Article. Details of the Transhi ments under Bond of certain Articles. Account of the Quantities of Articles liable Customs Duty remaining in Bond ; and Details of the Transhipments of Free Goods c through Bills of Lading. ' [Cmd. 36G] of Session 1919. Price 4.9. Gd. (bs. M.) CURRENCY AND FOREIGN EXCHANGES AFTER THE WAR. FlNAI. llEl'OliT OF THE COMMITTEE Terms of Appointment and Reference ; Foreign Exchanges ; Bank of fEnglan i Government Borrowings on Ways and Means Advances from the'j Bank of Englan j Foreign Banks ; Scottish and Irish Banks ; Currency Note Issue. | [Craeen prepared in this Dei)artnient. The demand for copies of the inevious Rejmrt npon this sub- ject, issued by the Labour Department of the JJoard of Trade in 1012, has been so yreat that the volume has h)n<^' since been out of print. The Department has, moreover, received many intjuiries for further information, and it appeared that the time had come for another j^eneral sun-ey of the Avhole movement in tliis country. The terms " Profit-sharing- " and " La.bour Co-partnership," ])articularly the former, are often used in a very loose sense; and, according^ly, a section of the Report is devoted to the definition and interpretation of these terms. " Profit-Sharing' " is ex- plainerofit-sharing schemes was shown in the four years from 1889 to 1892. The year 1889 was a landmark in the history of the profit-sharing movement, being the year in which the profit-sharing scheme of the South Metropolitan Gas Company was launched (followed almost imme- diately by a strike), and in which the International Oongress on Profit-sharing assembled. It marked one of those periods of industrial unrest which seem to be associated almost invariably with a strong wave of interest in Profit-sharing. Other periods of activity in the profit-sharing movement have been 1908-9 (especially in the gas industry), 1912-14, and the present year (1919), in the first 10 months of which no fewer than 29 schemes have been started. The gas industry is the only one that has adopted Profit- sharing (or Co-partnership) on anything approaching a. national scale. In all other groups of industries it is only a very small minority of firms that have adopted the system ; and the variety of the schemes that have been adopted is very great. It is interesting to observ-e that the gas industry, which has always been regarded as peculiarly well-suited to a Co-partner- ship system, and this largely owing to its substantial and (as (24335—14.) Wt. 13674— 4607. 7000 & 90. 2/20. H.St. (J. 4. A 2 fVAH IV \\;is sui)Iios«mI) almost assuietl in't>fit.s, has suflfered perhaps more- than any other industry from the hif>-h prices ami the rise in wa^res ix>n6sal of their profits. In these circumstances^ itsjHMks well for the stability oi these schemes (which are nearly all mod«'lhMl ( losely on the parent scheme, that of the South .Metvop()lilan (ias ('(Hni)any), that only two of the gas schemes, out of ;iS, haAc hccn abandoned during- the war. The jjocuniary results of Profit-sharing-, ais tested by the amount ol boJuis i>aid, are, in many cases, not inconsiderable. Such results as the three-quarters of a million jxHinds paid by the South Metropolitan Ga,s ('omi>any in bonus in 30 yeais; or the nearly e(|ual sum ]>aiid bv Messrs. Lever Brothers, in only ll» year^; or the £.'{80,000 jiaid by Messrs. J., T. and J. Taylor, a much smaller firm, to their employees, who now own more thaiL half the shares — these and other like results are clearly sulv stantial ac hievements. Putting tog-ether the results of all the schemes it would appear that, wkile in every year a certain numl)er of firms are unable to i)ay any bonus at all, the average lK)nus, over a long series of years, may be put at about o or 6 per cent., thf equivalent of two or three weeks' wages. it is not only as a bonus-producing de\'ice, however, that Profit-sharing and Co-p-artnership should be regarded; and as a means of developing the sense of community of interest between employer and employed, it seems possible to speak with consider- able confidence of the eifects of these schemes. In some firms Profit-sharing or Co-partnership is only one of a group of devices directed towards the establishing of good relations between the empktyer and his workpeople, and towards giving the latter an insight into the employer's problems and some control over their owni conditions of employment. The experience of some firms who have established Co-partnership Committees w^ith these ends in view is certainly most encouraging-; and it would appear that thoerative Societies, wihich may be briefly referred to here. The number of retail distribiitive (store) societies which practise Profit-sharing has been steadily declining for some years, and is now only 103, or 7^ per cent, of the total, witli an average Iwmus of about 4 per cent. In the group of productive a.'^sociations of workers," on the other hand, the- n umber of .societies which continue to practise Profit-sharing- remains fairly steady at about 40; and the ratio of bonus to wages kas shown an advancing tendency during the AVar. In conclusion, I desire lo point out that, altliough an endeavour has been made to make the paiticulars contained in this Rejiort with regard to Profit-sharing and Co-partnership in the United King'dom as complete as possible, it is not claimed that they are exhaustive. The Department will welcome information as to anj^ past or present schemes which are not mentioned in the Report, and will be glad to receive the names of any employers who may hereafter adopt any system of Profit-sharing or Labour Co-partnership. I have the honour to be, Sir, Your obedient Servant, JOHX HILTOX Intelligence and Statistics Department, Ministry of Labour, December, 1919. 24335 A 3 VI REPORT ON PROFIT - SHARING AND LABOUR CO-PARTNERSHIP IN THE UNITED KINGDOM. CONTENTS. Introddction Page. 1 Part I : PROFiT-siiAiuNr} and Labour Co-partnership in Businesses OTHER THAN CO-OPERATIVE SOCIETIES : — A.— General Report:— Scope of Enquiry : Definition of Terms " Profit-sharing " and " Labour Co-partnership " Progress of Profit-sharing ; Proportion of Abandoned Schemes to Total Causes of Abandonment Classified Duration of Schemes ... Trades in which Profit-sharing is found Size of Profit-sharing Firms Prevailing Types of Schemes Alleged Danger of Over-Capitalisation under Shareholding plan Financial Results of Profit-sharing Employees' Control through Shareholders' Meetings Other Results of Profit-sharing Effect of the War on Profit-sharing and Labour Co-partnership 9 12 14 15 16 17 19 22 25 27 28 B. -Detailed Report :— (i.) Anali/sis oj Schemett iioio in Force : — Legal Contract or Gratuity ? ... Determination of Total Bonus Conditions attached to Profit-sharing Division of Total Bonus among Employees ... Payment of Bonus Bonus reserved as a Provident Fund ... Purposes to which Provident Funds are applied Investment of Provident Funds Bonus retained for Investment in Capital Shares issued to Employees on special terms Provisions against Transfer of Employees' Shares Voting Rights of Employees ... Proportion of Capital held by Employees Profit-sharing Deposits ... Employee-Directors ; Joint Committees 32 32 35 36 38 39 39 40 41 41 43 44 44 44 46 (ii.) Detailed Account of Certain Existhirj Schemes : — (a) Profit-sharing and Co-partnership in Gas Undertakings :- Page. \ South Metropolitan Gas Company ... 47 Other Gas Companies 55 (b) Profit-sharing and Co-partnership other than in Gas Under- takings : — (1) " Savings" or "Deposit " Schemes : — Sir W. G. Armstrong, Whitworth & Co., Ltd 61 Fox Bros. & Co., Ltd ... 63 [E. S. & A. Robinson, Ltd. : see under '' Other Schemes," below.] Richard Thomas & Co., Ltd ... ... 65 (2) Shareholding by Employees : — Bradford Dyers' Association, Ltd. ... ... ... 67 Wm. Cory & Son, Ltd 71 Foster, Sons & Co., Ltd 72 Hazell, Watson & Viney, Ltd '. 76 Lever Bros., Ltd ... 78 London County "Westminster & Parr's Bank, Ltd. ... 85 J., T. & J. Taylor, Ltd 86 Wilkin & Sons, Ltd. (two schemes) 88 Firm No. 39 (paper merchants) ... ... ... ... 90 (3) Other Schemes (including Cash Bonus schemes) : — Blundell, Spence & Co., Ltd 91 British Cyanides Co.. Ltd. ... ... ... ... 93 Clarke, Nickolls & Coombs, Ltd 95 W. Dennis & Sons, Ltd 96 Wm. Gray & Co. (1918), Ltd 97 Home & Colonial Stores, Ltd 98 Indemnity Mutual Marine Assurance Co., Ltd. ... 99 John Knight, Ltd 101 Prudential Assurance Co., Ltd. ... ... ... ... 102 E. S. & A. Robinson, Ltd. (two schemes) ... ... 103 [Wilkin & Sons, Ltd. (pension scheme) : see under " Shareholding by Employees," above.] Firm No. 16 (paper makers) ... ... ... ... 105 (iii.) Detailed Account of Certain Abandoned Schemes : — Henry Briggs, Son & Co., Ltd. 106 Messrs. Gilbert Bros 109 Irvine's Shipbuilding & Dry Docks Co., Ltd. ... ... 113 Notes on other Abandoned Schemes 116 24335 A 4 vin Pagre. IVvl:i II l'l:..| u silAIIINti AMI LAItoL'I! CO-l'ARTNF.KSIlII' 1 N Co-OfKKATIVI'. SoC'IKTIF.S : — Introdiictioii ... ... ... ... ... .. ••• 122 Iiidtistriiil Co-operative Societies : — (i.) Associations of Consumers 127 (ii.) Associations of Workers... ... ... ... ... 132 Agricultural Co-operative .Societies ... ... ... ... 139 Conversion of Ordinary Businesses into Co-operative Societies 141 AriKMnrKs : — Appendix .V. : List of Existing Schemes 149 I>o. .\. (i.) : Existing Schemes, summarised by (i.) Form of Bonus Paynient, and (ii.) Duration (period in which started) " •. 166 Do. A. (ii.) : Existing Schemes, summarised as above, ercludiug (Jan Companion' Kcheinpn ... ... ... ... ... 166 Do, U. ; Ijist of Abandoned Schemes ... ... ... ... 167 Do. H. (i.) : Abandoned Schemes, summarised by (i.) Form of Bonus Payment, and (ii.) Period in which started ... 1H4 Do. C. : Ratio of Bonus to Wages : Detailed particulars for Years 1901-18 18,5 Do. C. (i.) : Ratio of Bonus to Wages: Summary for Period 1901-18 ' 189 Do. C.(ii.) : Distributions of Bonus in 1918 189 Do. D. : Profit-sharing on Farm Settlements belonging to Board of Agriculture and Fisheries ... ... ... ... 190 Do. E. : Rules of certain Profit-sharing or Co-partnership Schemes 191 Do. F. : Bibliography of British and Foreign Books, Pamphlets, etc., dealing with Profit-sharing S.nd Labour Co-partner- ship ... ... ... ... ... ... ... ... 215 Ini'K.x of Names 228 Inkkx of Srii.TF.cr.-^ 23.') INTRODUCTION. REPORT ON peofit-shaeinCt and laboue co-paetneeship IN THE UNITED KINGDOM. INTRODUCTION. A large number of unofficial publications relating to Profit- sharing and Labour Co-partnershii3 in the United Kingdom have been issued in recent years, particulars of AA^Jiich will be found in the bibliograidiy apj^ended to this Report; and in addition there have been three official Reports, issued in 1891, 1894 and 1912, respectively.* Statistics showing the progress of the move- ment from year to year have also been issued in the Labour Gazette and in the Abstract of Labour Statistics. The last detailed Report, issued in 1912, is, however, now out of ])rint; tuid the time, therefore, seems ripe for a fresh Report, especially as the great changes brought about by the war have severely tested the whole industrial and economic fabric of the lountry. It may be mentioned that an ofhcial Report on Profit-sharing in the United Statest was brought out by the United States (xovernment in 191T ; from which it may be presumed that the (luestion of Profit-sharing is receiving attention in that country -ilso. The princii)al alteration in this as compared with the previous Report is the addition of a section dealing in some detail with ;i few of the more notable abandoned schemes. It is obvious that the experience of these firms may be quite as useful to those who are proposing to introduce a scheme of Profit-sharing or Labour Co-partnershij) in their business as that of the firms whose schemes have survived, since they may indicate pitfalls to be ;i voided. In many cases, however, as will be evident from the summary given in Appendix B, there is a lack of precise and detailed information as to the cause of abandonment; while in other cavSes the cause appears to have been simply lack of pi^fits. * Report on Profit-sharing (C. 6267 of 1»91) ; Report on Profit-sharing (C. 7458 of 1894) ; Report on Profit-sharhiq and Labour Co-partnership in the rinited Kingdom (Cd. 6496 of 1912). t Profit Sharing in the United States : Bulletin of the United States Bureau of Labour Statistics : Whole Number, 208. 2 INTRODUCTION. Pixifit-sharinp ;intl L:ilM)ur Co-part uersliip exist in a great variety of forms, and in this Report it lias only been possible to ii'wo detailed ])articulars of some of the larger and more typical ^rhenu's, or of those which present some featnre of special interest. One broad distinction, however, may obviously be drawn at the outset, viz., between I'lotil-sluiring or Lalwur Co- partuei'ship schemes existing in Co-operative Societies, and those found in ordinary capitalistic businesses. In this Report the former are dealt with first, since it is to Profit-sharing in capital- istic undertakings that public attention has been principally drawn in recent discussions. It may be added that schemes on a basis resembling Profit- sharing in municipal trading undertakings are not included in this Report. So far as this Department is aware, however, there are only a few schemes of this nature in existence in this country. PART I. — PROFIT-SHARING AND LABOUR CO- PARTNERSHIP IN BUSINESSES OTHER THAN CO-OPERATIVE SOCIETIES. A— GENERAL REPORT. Scope of Eis'quiry : Definition of Terms "Profit-sharing" AND " Labour Co-partnership." It will be desirable at the outset to state in precise terms t}ie meaning- whicli is attached to the words ' ' Profit-sharing " and " Labour Co-partnership " in this Report. Definition of "Profit-sharing.'' — The definition of Profit-/ sharing adopted in this, as in previous Reports, is in the main 1 identical with that formulated by the International Congress on \ Profit-sharing held in Paris in 1889, and subsequently endorsed \ by several other International Congresses,* in the following terms : — " The International Congress is of opinion that the agree- ment, freely entered into, by which the employee receives a share, fixed in advance, of the profits, is in harmony with equity and with the essential principles underlying all legislation." For the j)urposes of the ]■) resent Report the term " Profit- sharing ";' has accordingly been used as applying to /those^'caFe^r- iir^whieli'^ii employer agrees with his employees that they shall receive,"rn partial remunei^ation of their laboiir, and in addition to their wagesj'a^ share, fi:s:ed beforehand, in the profits realised b;^ the undertaking to which the profit-sharing v«cheme relates. As7"towever, some of the terms used are ambiguous, it may be desirable to quote part of the report of the Special Committee who were appointed to investigate the subject, and who elucidated their definition as follows : — (i) With respect to the ''agreement" mentioned in the definition, the Committee consider that, while an agreement binding in law is the nonnal form,' Wey d o not exchide cases^in which the agreemjent has only a moraTihliga.tiou, provided that this^ agreement is. in fact, honourably carried out. (ii) By; a J^_sliare " in ,ii3:oii±s.jb3 meant . a , aiim_paid to an employee, in addition to his wages_, out of the profits, the amount of which'TFUependent on the amount <;il Lhe Sij pi'Oflt '?- If an enin lover undoitakes. for ex- ample, to contribute to a Pension Fund £1 for every £2 contributed by his workmen, this is not a case of Profit-sharing, unless the undertaking is to pay out of profits only, beca\ise the sum payable \inder the agreement does not depend upon the amount of the year's profits. * The International Co-operative Congresses of 1896 and 1897 and the Inter- national Congress on Profit-sharing in 1900. efl to Ihc " pi^ohts " ;i share in wliicli is, uruloi- ii inofil-shaiiu^- scIkmih', allotted to tlie em- jdovtM's, llu'se ])rofits are, in the <)])iiiion of the Ooiftr niittct'. to he iiridiMsiood as tJic actual net balance of '^■,\'\u rcalist'd 1>_\ the tiiianfMal ()])«'iati<)iis j)iojt iouate to savings effected in production, conuuissioii on sales, and other systems under w hi( li the amount of the bonus depends uiK)n tile li.in' >li;ill be " fixed in advance." Tt is not nece>s;uy (Juit tin' employees sliairioutw all the details of the basis upon which the anumnt of their share is fixed; thus an employer may agree to give his employees one-half of I ill his profits in excess of a cei'tain " Reserved 1 Limit," that limit being communicated only to an I icoountant, who certifies what is due to the employee.s; :his would be a case of Profit-sbanng. On the other lumd, if the share given to the employees is indeter- minate, i.e., if the employer at the end of the year determines whether he shall g-ive one-tenth or one- fifth, or isome other fraction of his profits, to hi^s employees, at his absolute discretion, and not upon any i)i>e-arranged l);isis, this is not Profit-sharing, (\\) The next question is, su])posing the total amount which an employer is to give to his employees as a lK)dy to be fixed ujKMi a jjre-determined basis, must the share of I fach individual i>;irticipant 1)e similarly fixed? Or may the employer distribute this .amount at his unfettered discretion among the different emjjloyees, aciording tchemes such as this were admitted, any of the very numerous cases where firms make a present to their employees at Chnstmas * While the general principle here laid down is accepted, it has not appeared })roper to draw in this Report any such hard and fast line as to the irreducible minimum proportion of employees who must be participants. f The Rt. Hon. J. R. Clynes, M.P., in an address given at the annual meeting of the Labour Co-partnership Association on the 22nd May, 1919, suggested that the neglect of some employers, in times past, to take their workpeople into their confidence and discuss with them *' the more material parts and features" of schemes which they were proposing to introduce, had had something! to do with the hostility of some Trade Unions to certain profit-sharing schemes.! He considered, however, that there had recently been a great improvement in| the action of employers in this respect. r, CENBRAL REPORT. ui- tin- N.'w VtMi-, oi- \\\un- a luiiip -uiii is voied to tho employees iit tlu« annual f^cncral nicrting oi .sliureholilers, might be in- rliHltMl as " J*ix)fi1-shaiing-/' .so long- as the present or lump sum was i)ni(l out of \n\)i\is and not as part of the ordinary working exi)enses. Tliis, however, would genenilly be regarded as an iMegitimalc extU( li ii coiiuiiitlee lor the adiiiinislraiioii of tli»' inuHt-shiuiiij,' oi .jo-pailnt'isliip luiul or fiiiids; and these . oiiuiiittt'es fuMiueiitlj' exercise wide powers, in a consultative . in other details of workshop management. Such t (imniittccs arc. in tact, very siinihir to tlie " AYorkshop I iCoinniiitees "' wliich have been or aie beinn- set up in vaiious \voilx> midei the scheme outlined in the Whitle.y 'jHepori. In many rases. ])articularly in the large and j inipcnlanl grouj) m])ei', 1918, Dr. Carjienter (the Cliaiiinan of the Soutli Metroi^jlitan Gas Com- pany) is rejMirted to have said tliat he thought the workmen in > that undertaking were able to influence the prosperity of the X, undertaking even more by their work on the Co-portnership /Committee than l)y their representation on the Board of Direc- / tors, thoug'h they were useful in both capacities. The Co- \ partnership Committee in this undertaking is, in Dr. Carpenter's .wolds, "really a small-s(-ale Parliament of Laboui-, with busi- nesslike habits." (Further particulars with reg-ard to this Com- mittee will be found on pages o(J-2.) Reference may also be niade to the observations on this subject quoted on pp. 94-5, in the account of the scheme of flic British Cyanides Co.. Ltd. It should be carefully noted that the mere issue of .shares to employees, even gratis, does not in itself constitiite either Profit- shariirg_or Cpjjartnershij). It is not unusual, for example, for a private Arm, when converting itself into a limited company, to isstie (1 certain number of complimentary shares to .some of its employees; this would not necessarily be a case of Profit- sharing, especially if the issue were confined, as is often the case, to a few of the principal officials and older employees. It is sometimes, indeed, a matter of some difficulty to decide whether a shareholding scheme should be regarded! as a case of I'rofit-sharin^ or not. If an employer, when making an issue of shai-es to employees gratuitously or on specially favourable /terms, lets it be known thar he intends to make other similar I issues later on. and that his object in so doing is to associate his employees with him in the profits of the undertaking, still more if the scheme itself jjrovides for a constant succession of such issues, such a scheme clearly ought to be inchided. On the ' other hand, a single issue of shares, where there is no prospect ot any succeeding issues, cannot properly be called a " scheme " or " system " of Profit-sharing at all. In the course of years the oiiginal recipients will have died, retired, left the firm's employ- ment, or sold their shares; and the element of participation by employees will thus gradually disappear. It is iifit safe, however. It. rule out of consideration all cases where an issue of shares is unaccompanied by a definite scheme for renewing such i.ssues at recurrent intervals. The employer hini-^elf may not have made up his mind whether he will issue PROGRESS OP PROFIT-SHARING. any further sliares or not. The first issue may be experimental : it may either, on the one hiind, lead the way to further issues, or to a regular scheme of participation ; or it may be unsuccess- ful, and the employer may give up any idea he may have had of issuing any more shares to his employees. In such cases the only safe course appears to he to include a scheme of this nature provisionally when it is started, if it appears to hold out any prospect of establishing a system of participation by em- ployees; and to remove it later on if it proves to have lost the element of employee-participation.* General Position of Profit-sharing and Labour Co-partnership . Fi'Ofjress of Profit-sharing ; Proportion of Abandoned Schemes to Total. — The most noticeable feature in the statistics of the Profit-sharing and Co-partnership movement in this country as a whole. is the large proportioji of schemes which have ceased to oxi'st. Out of 380 schemes which are known to have existed a ■^ouic time or anotherj no fewer than 198 have come to an end Only fourteen of the schemes now existing are of more tlian' thirty years' standing, and only 36 were started earlier than tlir year 1901. The following Table shows the number of xhemes started in each year since 1865 inclusive (with an isolated scheme started in 1829), the number which have since been abandoned, and the num.ber now in existence. Table showing Progress of Profit-sharing in the United Kingdom. Year. Total Number of Schemes started in each year. Number of (Schemes that , have now ceased to exist. Number of Schemes in oper- ation! at 31st October, 1919. Proportion of Existing Schemes to total started. 1829 1865 1866 1867 1868 1869 1870 1871 1872 187.3 1874 1875 Total, 1829-1875 1 6 6 4 1 2 2 4 2 2 1 1 5 5 4 1 1 2 4 2 1 1 1 1 1 1 Per cent. Nil. 16-7 1 1 y 15-4 1 18-2 > 31 26 5 16-1 '' Three schemes of this nature, which were included in the 1912 Report, have been omitted from the present Report, on the grounds indicated in the text. f Including six schemes which are described as '• suspended." II 10 GENERAL REPORT. X)f Y.M,r. Total niunber iif Schemes iturted in each ye»r. Number of Scheiiiea that have now ceased to exist. Number of ' Schemes in oper- ation* at 3 let October, 11119. i Proportion of Existing Schemes to total started. Per cent. i87r. 3 2 1 ^ 1877 — — — 1H7H 2 — 2 1- 42-9 IHT'J — — — 1 1880 2 2 — J 1881 3 2 1 1 1882 2 1 1 !- 36-4 188:5 3 2 1 1884 3 2 1 1 1885 — — — J 1886 6 4 2 1 1887 6 6 — 1 1888 6 G — J- 14-7 1889 18 13 5 1 1890 32 29 3 J 1891 16 14 2 1 1892 17 15 2 1 1893 6 5 1 j- 18-5 1894 6 3 3 1 1895 9 7 2 J 1896 6 4 2 1 1897 3 3 — 1 1898 3 3 \ 17-4 1899 2 1 1 1 1900 9 8 1 J Total, / 1829-1900 194 158 36 18-6 1901 4 2 2 1 1902 4 2 2 1 1903 6 2 4 ^ 48-0 1904 5 2 3 1 1905 6 5 1 J 1906 4 1 3 1 1907 9 5 4 1 1908 16 1 15 )■ 70-9 1909 16 4 12 1 1910 10 5 5 J 1911 8 1 7 1 1912 18 2 16 1 1913 15 2 13 )■ 82-3 1914 18 5 13 1 1915 3 1 2 J 1916 4 4 1 1917 5 5 6 1918 6 V 100-0 1919 29 1 29 ( 10 months). 1 1 \ Total ... 380 198 182* 47-9 Including six schemes which are described as " suspended." PROGRESS OF PROFIT-SHARING. 11 The numbers of schemes started show veiy great variations fix)m year to year. A movement in favour of Profit-sharing' is started, and for two, three or four years it continues with great piierg}' ; then the impetus dies down, and the movement is ((uiescfnt, sometimes for a long i^eriod of_years. The years 1889-92, 1908-9, 1912-14 and 1919 were' periods of maximum activiiy; while the whole period I893-190T, the year 1911, and the period of the war, were periods of quiescence. It is difficult to correlate these fluctuations in any way with those of other industrial statistics, except that the figures seem to indicate, in a very general way, that periods of activity in \/\ the profitHsharing movement coincide with periods (a) of good A /\ einployment, and (5) of industrial UJirest. At such times there/ \ seems to be a recurring tendency on the part of employers to resoit to the expedient of Pix)fit-sharing as a possible remedy for the Unrest. Periods of bad employment, on the other hand, are \ generally also .periods of low profits, which are, of course, "noT/X fiivouruble to the introduction of profit-sharing schemes. Taking the four periods of maximum activity in the profit^ sharing movement noted above, it will be remembered that J ,.8.89_ was the year of the Ijiternational Congress on Profit-sharing referred to on page 3, from which it may be inferred that Profit-sharing was receiving a good deal of public attention at that Time, in this and in other countries. This was also thei year ol the inauguration of the South Metropolitan Gais ComJ pany's scheme.* It may be added that 1889, 1890 and 1891 were all years of good employment; though the tide turned in 1892. ' 1 The next period of maximum activity, 1908-9, is not really \ a case of general activity in the profit-sharing movement at all, but rather illustrates the way in which the gas companies' schemes dominated the statistics of Profit-sharing in the early years of this century. Only four of the surviving schemes of 1908, and five schemes dating* from 1909, originated in industries other than the gas industry. I The next period, 1912-14, is a conspicuous example of a period ) at once of good employment and of industrial unrest. As for -the present ye-ar, in .which_,29 schemes were started diu'ing the first ten months, it niay be conjectured that this * For a detailed account of this scheme, and of the circumstances under which it was introduced, see pp. 47-54. It was at this time also that Mr. A. F. Hills, the managing director of the Thames Ironworks and Shipbuilding Co., Ltd., sought to introduce a profit- sharing scheme in the business of that Company. A series of disputes had occurred in 1889 and 1890, and, in the hope of putting an end to the unrest, Mr. Hills proposed, in April, 1890, a scheme of profit-sharing under which, after 10 per cent, had been paid on share capital, the remaining profits were to be divided equally between the shareholders and the employees. The Trade Unions, however, were, speaking generally, decidedly hostile to the proposal ; and, after discussions extending over three months, it was rejected by a large majority of votes. Mr. Hills subsequently introduced what was called a " Good Fellowship " scheme, a species of " Gain-sharing," under which the workpeople shared in savings effected in labour cost, irrespective of the rate of profits earned. See Report on Profit-sharing (C. 7,458 of 1894), p. 98 ; and Report on Gain-sharing (C. 7,848 of 1895), p. 63. X ]J (JENKRAL REPORT. inviic iiuiiiImt is pm-tly to be aUributed to tlie iulmtluctioii of Hosti>oru'»l .scli«MiM'>, wiiiclj would have been i)itix)duted earlier but tor \\u' War. and jiaitly lo the faci tliat 1919 has been .» period (d tt-riiU'iit in the industrial world. N<» leui'r than S.'} scht'iues were started in the tour yeais 1889-92, a far ^neater number tlian has been started in any similar ])('iind helore or since; but the ett'ert of the ^reat impulse ^iven to the m(»vemeiit in thes«' toni years was very hirgeJy lost during the Jou^' period (d' staj>iiati(in wliicii ltd lowed, the number of new schemes hein^jr barely suftieient to make up for wasta } } Total: 5-15 years, 78 (or 4^ per cent.) \ Total : over 15 years, 30 (or per cent.) 16! ^ \ The average duration for all these cases was rather over eight \| and a half years. xV third of them came to an end before the \fourth, and half of them before the seventh, year of the experi- ~~TT^ should be noted that these figures rather exaggerate the effective duration of the abandoned schemes, since, in not a fcAv cases, a bonus had ceased to be paid, or had sunk to a very low level, for some years before the schemes were formally terminated. Of the 182 existing schemes, 29 have been stai-ted in the present year(1919). "Tu' tlie"bther cases the duration is : — 1-4 3'ears in 17 cases. 5-6 26 7-8 23 9-10 17 11-12 19 13-15 T 16-20 10 21-25 7 26-30 13 31-40 6 41-54 8 The average duration of all the surviving schemes (excluding those started in the present year) is about fourteen years. It is interesting to obsem-e that the average duration shows a s light in creas iKiid 111 <;i>,li, but employees have the optiou of takiij^^ l)art ot their Ixjiius in shares. (e) Bonus paid in lash, but employers reserve right to pay in the form of shares in the business. (/) l^)nus paid in cash, or may be invested in a Provident Fund established by the firm, at option of employee. it/) Bonus i)aid in cash, or credited to Trustee account for purchase of shares, at option of employee, (//) HoMus takes the form of interest on deposits, varying with the rate of dividend on cajjital ; this bonus is paid in cash, unless the employee prefers to leave it on deposit with the firm. (;■) Bonus takes the form of dividend on shares issued gratuitously. (/•) lionus is that portion of the dividend on shares held by em})loyees which represents the advantages given by the firm to omjiloyee-sharcholders over shareholders among the general public. Special attention may be drawni to the two last-mentioned types of scheme, which should be carefully distinguished from those indicated by the code letter '* S '' in Appendices A, A (i) and A (ii). In the " S " schemes a bonus fund is first created by setting aside a certain amount out of the employers' profits, which is then distributed among the individual participating employees; but, instead of being jiaid in cash, it is either paid in the form of shares, or comjiulsorily retained by the employing company for investment in its shares or stock. In the " C " schemes now under consideration, the shares are allotted direct to the employees without any inteniiediato stage of bonus distribu- tion. The " bonus " in this case does not consist in the distribu- tion of shores, the number of which does not bear any necessary relation to the amount of the profits, but in the dividends on the share.*! (where the shores are issued gratuitously), or in that por- tion of the dividend which represents the advantage received by the employee-shareholder over the ordinary investor (in schemes where the shares are issued on fa^-ourable terms, but not gratuitously). Where, as is almost invariably the case, the tlividends on these shares are paid in cash, such schemes are cla^isifiod under the code letter '' C." A huge ]M-0 GENERAL REPORT. ' be iv limit to tli;it kind of thing. A natural limit would, no doubt, •' lie ri'uilied when the cai)ital became so f^reat that the dividends '* to siiarelioiders. There would then • Ik> no new is.sue of stock, and althoufih every .sliareholder woukl ■' ho eoneerned in maititaining the 5 jwr cent, dividend, there would "clearly not bo the .stimuhus that tlioro is at present."* 'I'he (lander of ov^^r-capiUilisation is oue that has been recog'- tiis«'(l and ^iiaidcd iig-iiiist, in many of the scdienies where tho bonus is oitlior paid in the form of shares, or accumulated for investment in shares. Thu.s, Messrs, T. Snowden and Son, who have a scheme of tliis kind, reserve the right to pay the whole or jmrt of the ])onus in cash, if additional capital is not required. S(( ao-aii), Spillers Milling- and Associated Industries, Ltd., pro- vide Ihat, as soon .ts a co-partner holds preference shares to the \alue of twice his sahny, any further l)onus due to him is jiayable wholly in cash. Similarly, where the scheme consists in the issue of shares to employees free, or on specially favourable Uernis, the total amount of the issue is almost invariably limited. It seems possible, however, that the danger of over-capitalisa- tion may have been exaggerated. The objection seems to be ba>^^d on the assumption that the whole of the inA-estments repre- senting- employees' accumulated boniises must be new capital, which is. of_coursej not the case. ' The }K).sition as regards gas undertakings, which have some- times been adduced as examples of undertaking's that can absorb an almo^it unlimited amount of new capital, is thus explainear at the time of application, irrespective of market value, Dr. Carpenter said: — •' Xo; we l)uy from the market. If we are issuing stock, we reserve " a certain pniportion for our working people, but they have to pay • the j)rice at which that stock is issued: but if we are not issuing, " as ha*; happened for several years past, then we have to buy off '• the market, and we issue to them at the price at which we buy. •- If we buy at 1-12.3 for £100, thev have to pay at the rate of £123 " for their £100." • The jtrog and <-'<;/x of a cash-bonus system of Profit-sharing are discus.sed in '■ Experiments in Profit-sharing and Co-partnership : No. 2," issued by the Laljour Co-partnership .Association (C. IMoomslmry Square, London, W.C.I). This pamphlet contains a report of an address delivered by Mr. Alexander Horn, of Messrs. Clarke, NickoIIs and Coombs, Ltd., on the 20th November, 191«, and of the discussion following thereupon. t HouBe of Commons Paper 74, of Session 1918 : pp. G5 and 70. DANGER OF OVER-CAPITALISATION, &C. 21 In reply to an inciuiiy ackbessed to liim by the Department in regard to this evidence, Dr. Carpenter wrote as followvS on the 20th January, 1919: — " I am pleased to have the opportunity of correcting a misappre- hension which, I believe, exists, and which is. I am afraid, encouraged. Our Co-partnership scheme has not involved and does not involve any increase in capital. It does not, in other words, suffer from the disabilities that many so-called Co-partnership schemes do in having special classes of stock created for it. In the early days of the gas industry, and for many years after- wards, stock was lield by comparatively few people. We felt, however, that it would be an advantage to our business if we could induce our customers, to whom we are necessarily bound in a some- what different manner from the ordinary commercial undertaking, to take shares in our business ; and with whatever new issues of stock we made during the last five-and-twenty or thirty years, we took care to give facilities for the purchase of smaller quantities, and to see that these facilities were brought under the eyes of the small investor. That policy proved very successful. When we finst started our Co-partnership scheme, the bonus was given in cash, which, in the great majority of cases, there is no doubt, was largely wasted ; and it occurred to us to apply the same- principles as regards stock to our workpeople as we had to our customers, namely, to induce as many as possible to become share- holders; but we never issued stock specially for the customers or specially for the workpeople. As we extended our business fi'om time to time, we issued stock for the purpose of providiug the necessary capital and for no other. Our co-partners hold at the present time (January, 1919) £422,870 of stock: of that £46,600 was jiurchased by us from new issues for the purpose of converting our workpeople's money bonus into sliares ; but we purchased in the open market for this same purpose £376,270 of stock. New issues of gas companies' stock have to be advertised and sold either by tender or auction, and what our workpeople pay for it is not the face value but the market value, either at which the stock was issued in the case of new issues, or the price we have to pay on the- market when we buy to satisfy our requirements in this respect from time to time." The same objection to investment schemes has, of course, Ijeeii raised in other countries where Profit-sharing- and Co-partnership have been tried ; and it may be interesting" in this connection to quote the answer given to such objections by M. Godin, the founder of the famous co-partnership institution at Guise, in France, known as the Fmnilisiere: — " But, it will be said, an industrial undertaking, though it were- " based on Co-partnership, cannot go on increasing its capital " indefinitely. There comes a time when it iias all it needs to carry " on the industry; and surely when that time comes the disposable " profits must be distributed? No, I answer, there is no need for " any such distribution; the disposable profits will go on being con- " verted into share-capital in the Co-partnership for the benefit of the "participants; but their value will be applied towards re-imbursing " in full the founder's shares, then the other oldest shares, in order " of priority. By this successive re-imbursement and the delivery " of new .shares to the workers, the ownership of the capital will " gradually revert to the active members of the Company." L'J GENERAL REPORT. It may 1h' [>()int(Ml (uil tliat a scheme of this kind, whereby tho capital of tlu» uiulcrtakin^- is, so to speak, in continual circu- lation, so that it is always being- re-absorbed by the workpeople (hen in the employment of the undertaking-, obviously has a great advantag-o, from the jwint of view of making- the co-partnership <)£ lalK)iLr a reivlity, apart from its advantag-e in preventing «'\»-4's.sive issues of capital. The employee-shareholders by this moans gain a much larger measure of control over the business than if they are merely a small section of the ordinary share- liolders, who can always be outvoted by the other shareholders whose interest in the business is purely financial. Fiiunicidl /y'rsiilfs of Fro fit-Sharing, — The financial results of some of the old-established schemes are veiy considerable. Thus, the South Metropolitan Gas Company, whose scheme has been in operation for thirty yeai-s, have jjaid over £770,1)00 in bonuses during that period ; and the employees have over £5'00i,000 invested in the Company's shares or deposited in the hands of the Com- l)any at interest. Messrs. Lever Brothers, Limited, in the ten coinjjleted years of their Co-partnershiji, have distributed over £700,000. 'Messrs. J., T. and J. Taylor, Ltd., a much smaller firm than either of those just mentioned, have paid over £330,000 in l)onuses : their l)onuses have averaged over lOf per cent, on wages, and the employees now own more than half the capital, ^[essrs. Clarke, Xickolls, and Coombs, Ltd., have distributed in 29 years a sum of over £270,000; and their bonus for more than 20 years has never fallen below 10 per cent. These and other similar results certainly show that Profit- sharing and Co-partnership, in their various forms, are capable, under favourable conditions, of giving substantial benefits to the \\-orkpeople employed. Such results, however, are exceptional, and the general results of the system, taken as a whole, are less striking. The Table in Appendix C shows that the average rate oF 1x)nus paid, in all the schemes for which particulars can l)e given, varies within very narrow limits from year to year, the average for the whole period 1901-18 being 5'5 per cent. In evei-y year shown in the Table, from 1901 to 1909 inclusive, at least half of the schemes for which particulars can be given paid a bonus of less than 5 per cent. ; and in all the years shown (except 1915 and 1918), at least three out of every five schemes were paying less than 6 per cent. In eveiy year, indeed, there were a cei-tain numl)er of schemes, averaging about 15 per cent, of the total, which paid no bonus at all; while in 1918 the pro- portion of iiil schemes rises to 18 per cent. The figures for 1918 may be given in somewhat greater detail. The results of 105 schemes are known for this year. The total amount distributed in these 105 schemes was £299,728, divided among 81,833 persons, including those who received no bonus, but would have been entitled to participate if a bonus had been payable. The average bonus in these 105 schemes was thus FINANCIAL RESULTS OF PROFIT-SHARING 23 £3 13s. 3d. The details for the principal groups of trades are as follows : — Group of Trades, and Number of Sehemea covered. Number of Employees participating (or entitled to participate). Total Amount of Bonus. Average Bonus per Head. £ £ s. d. Chemicals, oils, &c. (5) 2,393 30,509 12 15 Food and drink (10) 3,622 43,396 11 19 7 Gas (31) 22,447 24,985 1 2 3 Engineering, &c. (6) 15,004 34,415 2 5 10 Printing, &c. (10) 3,870 29,461 7 12 3 Textile (9) 5,784 52,254 9 8 Merchants, &c. (15) 6,959 67,817 9 14 11 Insurance, &c. (1) ... 18,500 Nil Nil All other groups (18) 3,254 16,891 5 3 10 Total (or average) (105) 81,833 299,728 3 13 3 . If employees in finus which distributed no bonus be excluded, the total number of actual participants in the schemes for which particulars can be given was 52,056, and the average bonus was £5 165. 2d. The outstanding features of this Table are the large bonuses in the chemical and in the food and drink groups, and the small bonuses in the gas, engineering, and insurance groups. The reasons for the low bonus in the gas and in the (life) insurance group are given on pp. 29 and 103, respectively. As for the engineering grouj), the api^arently low bonus is mislead- ing, since about half of the bonus for this group of trades is attributable to one scheme, in which the " bonus " consists of a supplementary rate of interest, varying with the profits, paid on savings deposited by employees: the "bonus" therefore is limited by the amount of use which the employees choose to make of the firm's Deposit Fund. A scheme of this nature cannot, of course, be taken as an indication of the possible value of any and every form of Profit-sharing, as applied to the engineering industry. Statistics of the ratio of bonus to wages can be given for 93 gohe mes in 1918. The average bonus for all trades (taking into account the number participating at each rate, and also the number entitled toi participate, in cases where no bonus was pay- able) was 5;ljgter cent. ; but the bonus paid in the several groups 24 GENKKAr- REPORT. of tnidt's .sho\v> v.'iy •iii-il viuiaiions. Tlie loading- paili( ulars are as folhiws : 1 iroup of Trailos. and Nunil..T of Schemes covered. (or cititi.d to to Wages or ('liemicals, oils. iM-r. (:'> Food ami drink ( 7 ) Gils (31) Knj,'iiu'eriiig, \'f. (fi) Printing. iVrc. ('.•) ... Te.\tile (7) Merchants. Xc. (la) In.su ranee, &c. (1) All other groups (13) Total (or average) (93) (^or iiiiuii'a 10 particiiiatei. Salaries. Per cent. 2,393 16-9 2,513 15-7 22,447 O-H 2,789 7-3 3,198 12-3 4,847 12 1 0,959 14-3 18.500 Nil 1,284 S-H 04,930 51 Ihc ahsoiice of bonus in the iasurance scheme, the low rate (►f bonus in the group of gas undertaking's, and the high rates e ridicu- lous to take half a dozen or even a dozen schemes, in such great groups of trades as the chemicail, the textile, or the printing trades, as giving any indication whatever of the financial }xm- tion of those industries. As a matter of fact several of these groups are dominated by the statistics of one particular firm : and the magnitude or insignificance of the bonus may be due to tlie l>eosition of that firm, not to say of the gioup as a whole. Il may be a>k('(l how far the Ixjnus is a (dear addition to wages, and iiow tar it is merely a substitute for wages. For s<)un' industries, where the workpeople are highly orga- nised, il may he asserted with confidence that the profit-sharing bonus is a i)ure addition to wages, as the Trade Unions would almost certainly not allow the bonus to be taken into considera- tion in fixing the rates of wages. In other cases, however, there are no sufficient dat^i to decide whether tlie Imjuus r> taken into consideration m fixing wages. Tliis uncertainty may exist, for example, (i) in trades where tlie workjieople are not strongly organised: or (ii) in undertakings which ix).S8ess a local monopoly, ^SUch Ui g'Uii-WiH'ks. As regards the unorganised trades, it is noteworthy that there is only one case where it is definitely stated that higher wages would have had to be given but for ihe profit-sharing bonus. The unorganised trades. h<^)wever. are more and more coming under the control of Trade lioards; and it may be anticipated -that the time will soon come when the question whether the EMPLOYEES' CONTROL THROUGH SHAREHOLDERS' MEETINGS. 25 existence of a profit-skaring' scheme has depressed the rate of ; wages will no longer arise, at least as regards the minimum rate,, /i which will be fully protected by law. The case of gas undertakings, and other undertakings with local monopolies, is somewhat different. Here the difl&culty is that, from the nature of the case, it is impossible to determine whether a rate of wages would have been higher but for the bonus, and, if so, by how much. To decide this it would be necessary to compare the rates of wages paid in two gasworks, both in the same locality and working under identical conditions, except that one had a profit-sharing scheme and the other had not; and this state of things cannot, of ooui^se, be found. The question whethea* the profit-sharing bonus is a clear addition to wages could not in any case be answered without very minute enquiry; and in the present circumstances it is further complicated by the great general rise in wages that has taken place — a rise in which the existence or non-existen.".e of a profit- sharing bonus of 5 or 6 per cent, sinks into relative insignifi. cance. If it would be difficult to determine whether the ordinary rate of wages paid was the standard rate for the trade, irrespec- tive of the profit-sharing arrang"ement, it would be even more hopeless to attempt to decide such a hypothetical question ais, whether any particular war-wage advance granted by a firm practising Profit-sharing was less than what would have been granted if the profitrsharing arrangement had not been in existr enoe, and, if so, by how much. Employees' Control through Shareholders' Meetings. — The figures given on page 44 show that the proportion of votes which might be given at a shareholders' meeting by the em- ployees, in virtue of shares held by them, is almost negligible in all but a very small number of cases. At first sight this virtual absence of control through the shareholders' meeting may seem to invove the failure of the aspirations of certain advocates of Profit-sharing and Co-partnership who have been accustomed to attach importance to the employees acquiring control in this manner. It was also hoped by these advocates of Co-partnership that the employees of a business would be able, as shareholders, to gain an insight into the capita lists' commiercial difficulties and financial hazards and anxieties. It is open to question, however, whether the shareholders' meeting is the best medium through which the employees may exercise that control, and gain that knowledge, which is desiderated. The shareholders' meeting is held once, or in some cases twice, a year, often in London or in some other commercial centre remote from the works. The various proposals of the board of directors, as regards dividends, &c., are almost invari- ably passed with little or no serious opposition, in the presence of a handful of the shareholders ; and the chief purpose of the meeting is to gire the directors an opportunity of explaining the position of the industry in general, and of the undertaking which they control in particular. The shareholders, however, are obviously in a very different position from the workpeople : in the case of a large concern 24335 B 26 GENERAL REPORT. there mny be many thousands of shareholders scattered all over the countVy, and only se^-ing one another (if at all) at the general meeting or meetings; more, or a supplementary bonus (to bring the profit.sliariu^r hoiuis uj) to a substantial amount), as a gratuity,* witluiul rc^rjinl to the sliding' stale, whicii remains unaltered. Tlifst' minimum or supplementary ]>onuses have rang-ed from three-quarters of one per cent, (and that jjayable only " so long "as the shareholders receive any dividend at all"), to over 8 per cent. Apart from the gas companies, the most marked effect of the war was in checking the introduction of new schemes : only three were started in 1915, four in 1916, five in 1917, and the same number in 1918. The very large number started during the pi-esent year (twenty-nine in ten months) may be due in part to the holding up of schemes during the war. Several firms refer to the effects of the high Income Tax, and of the Excess Profits Duty, in reducing the amount available for distribution as bonus. Thus one firm, in spite of an increase in gross profits, had a smaller net amount available for distri- Inition, and in fact felt it necessary to pay a special bonus, not on the meagre basis that their profit-sharing scheme would have given. Other firms also improved their scale of bonuses, in order to compensate their employees for the reduction in distributable profits. Another firm, engaged on munition work, found their distributable profits reduced by the munitions levy, which was the counterpart of Excess Profits Duty in munition firms. Several firms refer to the fact that they had encouraged War Savings Associations in their businesses, and that this had re- duced the amount that would otherwise have been deposited in the firm's Savings Bank, or invested in shares in the under- taking. For example, Messrs. E. S. and A. Robinson, Limited, have a savings bank in which their emploj-ees had £20,000 de- posited at the beginning of the war; but during the war they encouraged their workpeople to invest in War Savings Certifi- cates instead of putting their savings in the firm's Savings Bank. This unparalleled opportunity for the investment of small sums in a Government loan at a good rate of interest should be taken into consideration in studying columns 9, 10, and 11 of the Tal)le in Api)endix A. (investments of employees in existing jirofit-sharing schemes). One firm, how^ever, truly remarks that the habit of saving thus formed may work to the advantage of the employers' own thrift or investment schemes in the long run. The Government control of corn mills was sometimes referred to as affecting the working of the scheme; in one case it led to the suspension of a scheme, and in another case it was partly responsible for the abandonment of a scheme, • In calculating the ratio of bonus to wages (see Appendix C, pp. 185-8), only such amounts as represent the true bonus under the sliding scale are included. Bonuses, or supplementary additions to bonuses, given as a gratuity and not nnder the rules of the scheme, are omitted. EFFECT OF THE WAR ON PROFIT-SHARING. 31 Other divers effects of the war, direct and indirect, are given as follows : — A flour-millmg firm. — Many newly engaged men and women have looked upon their engagements as temporary, and have not stayed long euongli to enjoy the benefits of the scheme. A firm of dyers and cleaners attributes the reduction of profits to the depletion of staff through men joining the Colours, and girls going into munitions. Several other firms refer to the depletion of their stafis owing to men joining H.M. Forces. A lace-making firm,. — Money was late in coming in from foreign branches ; in some oases it never came in. This caused a delay in paying the bonus. An electricity undertaking refers to the increased cost of labour, raw materials, &c., and also to the lighting restrictions, as reducing profits and consequently bonus. A firm of wine and spirit merchants refers to the smaller amount of labour employed, and to the stoppage of extensions that had been intended, on account of Excess Pix)fiti-.' Duty. A firm of general merchants in North Wales refers to the loss -of business owing to the migration of 2,000 workpeople from the neighbourhood to otjier parts of the country. 24335 B 4 ,^2 DFyPAILKI) RRPORT. B.— DETAILED REPORT. (i) A.NALVSl.s Ol' ScilE.\£P:S NOW IN L'UIICE.* The .^clienios of I'rofit-sliaring or Labour Co-partnership at prest^nt in force have been analysed, with a view to classifying and comparing thoir principal features; ond the results of this analysis are /ifiven below, the references to the various schemes boiiij,' indicated by means of numbers, viz., the serial numbers aUaclii'd lo the several Sclienies in Appendix A (pp. 150-105). The g-reat majoritj^ of schemes have been included in the analysis, but it will be understood that it has been impossible to mention every minute variation in all the schemes. Moreover, some schemes have no printed rules, and the Department has only a brief summary of their leading features. Again, infor- mation with regard to some of the more recent schemes was received too late to admit of complete analysis. Lerjnl Contract or Gratuity'? The majorit}' of schemes make no reference to the question whether the arrangement for ollotting a share of profits to the employees is a voluntiuy one or a matter of legal right. In some cases'* employees have a legal right to their sliare i]] the profits of the undertaking. On the other hand, several firms expressly stote that their profit-sharing schemes confer no legal rights on their employees,^ or that the bonus is a purely voluntary payment on their part." Determination of Total Bonus. Profits on ivJiich Bonus is calculated; '^Reserved Limit.' ^ — The profits taken into account for the purpose of calculating the amount of the l)onus are usually the net profits of the business for the year preceding the distribution. In six cases,*^ however, \ the bonus is declared on the holf-yearly profits of the under- V taking. In a few private firms,« before the divisible profits are arrived at, a certain amount has to be deducted as remuneration for the proprietors or managers of the business, or as interest on the capital wliicli they have invested in the undertaking, this amount forming the first c ho rge on the net profits. Similarly, with a large number of joint stock companies a cei-tain rate of dividend on shorcliolders' capital must first be paid before the amount of divisible profits is arrived at. The rate of dividend thus payable • Other than gas undertakings schemes, which are analysed on pp. 47-61. • e.q., Nos. .3, 6. and 82a. »• Nos. 10, 22. 24. .34, 4r,, and 157. • Nos. 10 16, 20. 21. 22, 24, 31, .32. 96, 104, 131. 135. 136. 137, and 157 ' Nos. 16, 31, 47, 74, 103, and 114. • Nos. 26, HI, 134, 142. 144, and 152. ANALYSIS OF SCHEMES NOW IN FORCE. 33 yaries from 2^ per cent. (No. 61) to 50 per cent. (No. 63) ; but in tlie majority of cases is either 5 per cent.^ or 6 per cent.** In a number of schemes provision is made for further deduc- tions from the net profits before the participation of the em- ployees begins. In many cases sums are to be set aside for -depreciation*^ or for reserve funds. '^ In the case of No. 6, before any profit is divided a sum is set aside to be added to a Pro- vident Fund for the benefit of widows and orphans of deceased employees. In the rules of selieme No. 135 it is stated that a sum may be similarly appropriated to proA'ide pensions for old employees of the firm. It will be seen that the above deductions, forming- the first charge on the net profits, are in the nature of a "reserved limit," i.e., a limit which the net profits must exceed before the participation of employees can begin. In the case of firm No. 20, this limit is stated to have been based, not on the actual profits of the years immediately preceding the introduction of the scheme, but on an amount below the average of these profits. "With firm No. 157 the " reserved limit " is the average annual net profits during the five years immediately preceding the war. Employees' Share in Divisible Profits. — The principle upon which the aggregate amount of bonus payable is cal- culated is usually made known to the employees, but in some schemes® this information is not disclosed, or is only disclosed to a few of the participants of higher rank, the em- ployees generally being merely informed of the amount which has become due to them from the profits. A number of firms, ^ however, provide that the results of the calculation determining the amount of the bonus are to be certified by an acconntant or auditor, whose certificate may be seen by employees if they so desire. The basis of a large proportion of profit-sharing schemes is the allocation of a fixed proportion of the divisible profits to the employees, the amount distributed rising or falling automati- calix_Jli.th-t.he profits. In two schemes (Nos. 44 and 46), how- ever, the proportion of profits which is set aside to form the bonus is not always the same, but is determined by a fixed scale of percentages varying with the amount of the profits. In a few - Nos. 5, 8, 12 (Pref. Shares), 17, 31, 3:^, 42, 45, 60, 80, 83, 84, 99, 123, 135 (Ord. Shares), 138 (Pref. Shares), and 146. No. 36 provides for a dividend of 5 per cent., plus any deficiency in the dividend for the preceding year. ^ Nos. 12 (Ord. Shares), 20, 49rt, 51, 52, 82./, 101, 104, 120, 135 (Pref. Shares), 139, 143, 156 (Pref. Shares), and 167 ; in the case of Nos. 52, 82«, 120, and 135 the rate is cumulative. Other percentages are as follows : No. 92, 8 per cent. ; Nos. 41, 137, 138 (Ord. Shares), 156 (Ord. Shares), 10 per cent. No. 154 provides for the payment of 5i per cent, on land-owning capital and 6 per cent, on farming and trading capital ; and losses sustained in any year must be carried over against profits in succeeding years. ' Nos. 20, 28, 33, 82a, 84, 86, 104, 106, 134, 135, 142, 143, 146, and 167. '1 Nos. 5, 6, 8, 20, 36, 42, 52, 82rt, 84, 106, 134, 135, 143, 144, 146, 156, and 167. ' Nos. 1, 16, 17, 23, 26, 30, 31, 32, 34, 43, 44, 1.36. ^ Nos. 12, 16, 23, 30, 39, 42, 44, 134, 135, 136, 144, 155, and 157 ;U DETAILED REPORT. iustaiuos," allhi.u<'li the participation of employees does not begin until the profits exceed a certain reserved limit, the bonus itself is not a proportion of the remaining profits beyond this limit, but Ls based on the total net profits. In a number of schemes*' the surplus profits beyond the i-cserved limit aro divided pro rata between capital and waiges, /.e., the bonus is a percentage on wages equal to the percentage dividend paid on capital over the " reserved limit." In two- cases (Nos. 27 and 35) the wAole of the net profits are thus divided. The rules of No. 139 provide that, after pay- ment of the reserved dividend (6 per cent.), a bonus of 2^ per cent, on wages is paid for every further 1 per cent, "dividend declared ; tbus, when a dividend of 10 per cent, is paid the bonus is also at the rate of 10 per cent. Any further profits over 10 per cent, are to be shared pro rata between capital and wages. The bonus in the case of Nos. 116 and 118 is a percentage on wages at a rate which is a fixed proportion of the dividend on capital : in the case of No. 116 this proportion is one-half, but no bonus is paj^able unless the dividend on capital reaches 5 per cent. In three schemes" the amount of bonus is a percentage of the amount available for payment of dividends on capital; and in the case of No. 133 an amount equal to tbe sum distributed in dividends on the "A" ordinary shares is set aside as bonus. A fixed amount is set aside as bonus for every one per cent, paid as dividend in the scheme of No. 25 ; while in the case of Nos. 45 and 51 the bonus takes the form of so many weeks' wages, the number of weeks depending upon the rate of dividend paid. One scheme which has been recently introduced (No. 158) provides first of all for the payment of a bonus at the fixed rate of 5 per cent, on the salaries of the em- ])loyees; in addition, whenever the Company pays a cash dividend at the rate of 10 per cent, or more upon its paid up ordinary capital, a further bonus is paid on salaries at the rate by which the dividend paid on such capital exceeds 5 per cent., with a maximum of 45 per cent. Coming to the usual type of scheme where the bonus is a fixed proportion of profits, there are a few cases in which no mention is made of any part of the total net profits being retained as a reserved limit. The whole of such profits, with unimportant exceptions, are appropriated as bonus in the case of No. 28. In other cases 25 per cent. (Nos. 86 and 145), 20 per cent. (No. 155). and 10 per cent. (No. 130) of the total net profits are thus distribiitable as bonus. Where the participation of employees is dependent upon the profits exceeding a certain reserved amount, the percentage of the srurplus profits which is set aside for the payment of bonus » Nos. 4.3, 44, and 48. »> Nos. .33. 49r,, 50, 60, 61, 84, 101, 104, 122, 144, and 146. « Nos. 14, 32, and 96. In the case of No. 92, the bonus consists of 1.5 per cent, of the amount (if any) distributed as dividend on the ordinary shares in excess of 8 per cent?., pJua three-quarters of 1 per cent, on the amount standing to the credit of the general reserve account. ANALYSIS OF SCHEMES NOW IN FORCE. 35 -varies from 2 per cent.* to 50 per cent.,'' about one-half of tlie -schemes which fix the bonus in this way allotting the latter percentage. (For the other percentages, see note°.) Conditions attached to Profit-sharing. The rules of la very large number of the schemes dealt with in this Report provide that, before employees may participate in the benefits conferred by the scheme, they must possess certain qualifications or fulfil certain conditions. The most common qualification is that which confines participation to employeesi who have been in the service of the firm for a certain minimum' period. The length of service required varies from four weeks^j to five years,® but is usually either six months or twelve months.' (For other periods, see footnote *.) In two cases (Nos. 32 and 155) employees must have served for twelve months to obtain the full bonus, but provision is made for them to obtain some proportion of the bonus if they have worked for a shorter period. In No. 167 employees must have served five years to get a full share, but receive a half share after three years. Employees below a certain age are excluded from participation in a few instances. s^ Among the various classes of employees who are occasionally excluded from participation are those working wholly or partly on commission,^ or those earning more than a certain wage or salary.^ Factory workers, employees working on a premium bonus system, and pieceworkers, are excluded in Nos. 46, 86, and 100, respectively. In one instance (No. 14) employees who belong to a Trade Union are excluded from participation ; but in some schemes membership of a Trade Union is expressly stated to ■^ No. 141. " Nos. 5, 20, 26, 36, 82a, 97, 120, 135, 142, 143, 152, and 167. « 33^ per cent, for Nos. 134, 154 and 156 ; 25 per cent, for Nos. 21, 102, 137, and 138 ; 20 per cent, for Nos. 12, 52, 83, and 157 ; 16f per cent, (of profits of part of the business) for No. 53 ; and 5 per cent, for Nos. 8 and 91. •^ No. 154. « Nos. 82«, 97, 120 and 121. ' Other periods are : — Three months : Nos. 45 and 74. Nine months : No. 42. Eighteen months : Nos. 12 and 23. Two years : Nos. 22, 24, 89, 103, 105, 132 and 138. Three years : Nos. 43, 88 and 99 ; also in the case of No. 49r;, except for those entering the firm's service before reaching the age of twenty-one, when a qualifying period of four years is required. Four years : No. 80 ; also in the case of No. 49a for those entering the firm's service before reaching the age of twenty-one. Four-and-a-quarter years : No. 28. ^' The qualifying age is eighteen in Nos. 23 and 138 ; twenty -one in Nos. 12, 119, 155 and 162 ; twenty-two in No. 80, and twenty-five in No. 120. Under acheme No. '22, employees under twenty-one receive a half-share in the bonus, provided they have been total abstainers and non-smokers during the whole of the preceding year. » Nos. 20, 100, 104, 116, 123, 138 and 146. In the case of No. 89 the scheme applies only to weekly wage earners at the works, and does not include branch manageresses. Persons whose remuneration is wholly or partly dependent on the firm's profits, or on the profits of any department of the business, are excluded under scheme No. 49a. ' Nos. 81, 105, 105a, 116 and 146. 3r> DKTAILEI) REPORT. ho no bar to j)articii):itinii. and in one scheme (No. 106) member- ship of a Trado Cnion is a conipiilsoiy condition of participating'. In a f«'\v cases" emj)h)yccs who are to participate must be selected lor rtvonmii'tub'd ])y (lie n)ana<>ers or foremen. Two firms (Nos. 124 anil 158) re(|uin' their employees to })e members of a provident fund as a condition of Ix'inj^- admitted to participation; and in one instonco (Xo. 49a) employees must own a life insurance |)olicy of a stated amount. Employees who do not possess cer- tain professional qualification.s are excluded from the scheme of Xo. 28. Where employees are otherwise qualified to participate in I)rotits, it is often provided that they may lose this right if found puilty of unsatisfactory conduct,'^ waste or nefirlig'ence," had tiTuekeeijinn-, or absenc-e without good reason,^ lack of in- tei^st in their work,® etc. In some instances employees are re- quired to sign an ogreement on becoming participants under the scheme ; in Xo. 135, for example, the employee must sign an untlertaking "to be regular and punctiial in attendance, to be constant and industrious at work, to be economical in the use of materials, and generally to avoid all broken time and slack- ness, or waste of time, material, or money belonging to the Company," Agreements not to waste time or material must be signed in schemes Xos. 49a and 80; and in the former of these schemes emploj-ees also promise not to divulge the firm's secrets or atfairs. Division of Total Bonus among Employees. In dividing the total amount of the bonus among those en- titled to participate, by far the most common method (except in shareholding schemes, or in '* savings " or " deposit " schemes, i^ for which see jip. 41-3 and 44—6) is to divide the sum amonp-li*^ proi)oition to their earnings during the period to Avhich the dis- tribution relates. In calculating the amount of earnings for this purpose, overtime is excluded in some schemes.^ Xo account is taken of earnings on piece-work in scheme Xo. 27. In scheme Xo. 155, in cases where wages are customarily paid on piece rates, the amount of bonus is calculated on the time-rate basis ruling in the trade. In some cases it is stated that, when calculating the earnings, allowaiu-e will be made in respect of time lost thiough sickness^^; though a limit is sometimes placed on the amount of lost time which will be allowed for in this manner.*^ With regard to time • No8. .34. 45 and 82. • Nos. •». 2H. .32, 45. 105 and 1 IC. • Xos. 32, 45, 4r,, 91, 105 and 11(5. ■• Nob. 12, 45, 4G, 155 and IGT. • No. 45. ' Nos. 22, 27. 40//. IOC. 116 and 155. • Nos. 51, 155 and 167. *• Up to one month in the case of No. 116. With No. 89 when the average time lost through sickness during the previous three years amounts to four weeks per annum, each ca.se will be considered by the Profit-Sharing Committee, who may withhold participation either completely or in part. Scheme No. 143 provides that absence through sickness shall be allowed for at the discretion of the Directors. ANALYSIS OP SCHEMES NOW IN FORCE. 37 lost otherwise than through sickness, scheme No. 51 provides that deductions will be made from an employee's bonus in respect of such lost time; but this firm has an additional provision allowing for ov^ertime which has been worked to cancel such lost time, one hour of overtime equalling- two hours of lost time for this purpose. In the case of No. 185 deductions from the bonus are made for time lost, waste, indolence and insubordina- tion; while with No, 50 it is provided that a reduced bonus may be paid to irregular employees, or to those who do bad worK causing loss to the firm. An interesting feature in scheme No. 155 is the fact that time lost by reason of a lock-out or general or district strike is not counted as time wilfully lost, and does not debar an employee from pai-ticipation in the profits ; but in the case of time lost by reason of a strike on a scale smaller than that of a district strike, such time is counted as time wilfully lost. In many instances the total bonus is not distributed among the participants strictly in proportion to their earnings. In two cases (Nos. 89 and 97) the division is regulated by a scale of wage limits. In some cases the distributibn is based on wages, but a reduced bonus is paid to employees with less than a certain length of service,^ or to those under a certain age.^ In otheir cases, a double share is paid to those with more than a certain amount of service. "^ In the case of firm No. 28 the basis of distribution is length of service only; and in scheme No. 141 half of the bonus is so distributed. In other instances^ an employee's share is partly regulated by his earnings and partly by length of service ; while in three cases^ provision is made for head men or heads of de- partments to receive an increased pix)portion. Wages, length of service, and position, are all taken into consideration in scheme No. 145. In some instances* the bonus is distributed among those en- titled to participate in equal shares. In scheme No. 138 a man receives one-and-a-half times as much, and an overlooker twice as much, as a woman. In many schemes the division of the total bonus among the employees is not regulated! by fixed rules, but is made either partly or wholly at tEe discretion of the employers. In distri- buting the bonus in such cases, various factors are taken into » Twelve months for No. 32 ; five years in the case of No. 167. ^ Employees under eighteen years of age receive one-quarter of the full share in the case of No. 136. In scheme No. 22 employees under twenty-one receive a half-share. (See further under " Conditions attached to Profit-sharing " on p. 35). "^ No. 17 (seven years' service). In the case of No. 33 a double share is given to employees who are not less than twenty-one years of age, who have been at least five years in the service of the firm, and who have become owners of shares in the business equal in amount to half their annual wages or salary. d Nos. 25, 100, 105, 135, 146 and 167. " Double shares in Nos. 22 and 89 ; in the case of No. 26 heads of departments receive one-third more than the normal proportion. ' Nos. 3, 47 and 136. .'507^.1 H :js detailed report. account, such as merit or value of services rendered,'* lengtli of sor\'ice,'' success," i i>09ition/ regular attendance," etc. In two rases (Nos. 12 and 14), lor the purpose of allotting the bonus, the firm divides the employees into classes according to their work, good timekeeping being also a factor wliich is taken into account in the wise of Xo. 14. In one instance (No. 92) the employees are divided into classes according to position and wages or salaries. With scheme No. 102 three-quarters of the total bonus goes to the managers, assistants, clerks, apprentices (ind lads, and one-quai-ter to the workmen; the sum in each case being distributed according to wages. In the case of " savings " or " deposit " schemes (i.e., schemes where the bonus takes the form of interest on the employee's deposits held by the firm, such interest varying with the profits) the amount of bonus is determined, not by the employee's earn- ings or length of service, but by the amount of his deposits. The amount of bonus payable in such cases is often limited in various ways: see section headed " Profit-sharing Deposits," on pp. 44-() below. Payment of Bonus. In almost every scheme the bonus is paid yearly, being deter- mined by the annual profits of the business. There are a fe>w schemes, however, in which the arrangement is to declare and pay (or credit) the bonus every half year,* or even quarterly^ or monthly.'' The rules of one firm (No. 139) provide that part of the bonus shall be distributed in weekly payments, during the year following that in respect of which the bonus is paid. The scheme of firm No. 157 works in cycles of three years, the bonus being declared annually but remaining in the hands of ihe firm at 6 per cent, until the end of the three-yearly period, unless thei employee prefers to take his bonus annually. In two instances (Nos, 26 and 152) a reser^-ation is made that, instead of distri- buting the whole of the bonus, part may sometimes be carried forward as a reserve for the purpose of averaging good and bad years; and in one case (No. 105), if the bonus fund amounts to less than £500, the whole of it is thus carried forward. There are a large number of cases in which part, or the whole of the bonus is not paid out in cash but remains in the hands of the firm for various purposes. In some instances this part /J of the bonus is placed to the employee's account, from which he is allowed to withdraw sums at any time on short notice. • Nos. 24, 34, 40, 80, 82a, 1.39 and 141 ; in the case of No. 141 this applies to half of the bonus only ; while with scheme No. 40 the bonus to the labourers it distributed in proportion to their wages, without any individual discrimination. •' Nos. 24 and .34. *■ No. .'»3 ; with No. 24, which applies to sale agents, the percentage of sales ta expenses is also taken into account at the branch oflBces. ^ No. 34. •■ No. 1.39. ' Nos. 10, 16, 31, 47, 74, 103, 108, 114 and 122. ' No. 1.36. " No. 14. ANALYSIS OF SCHEMES NOW IN FORCE. 39 l>- In other cases it is placed to his credit as a provident or super- annuation fund, and in such, cases is not ordinarily with drawable. A third method is to retain the bonus partly (^ or wholly for investment (on behalf of the employee) in the capital of the undertaking-. The form in which the bonus i? paid in all the existing- schemes dealt with in this Report is shown in Appendices A, A (i), and A (ii) ; see pp. 149-166. Bonus Reserved as a Provident Fund. In six cases^ the whole of the employees' bonus is credited to a provident, pension, or other benefit fund. In a larg-er number of schemes, however, the bonus is only partly devoted to this object, the proportion so treated being usually one-half.^ It is provided in the rules of several schemes" that the share of the total bonus which is due in respect of those employees who have not fulfilled the necessary conditions to enable them to partici- pate shall be paid into a common fund for the benefit of the employees generally. Purposes to which Provident Funds are Applied. Schemes under which the bonus is partly or wholly credited to a provident fund may be divided into two classes, viz. : (i) those in which a common fund exists for the benefit of the parti- cipants collectively, and (ii) those in which each employee's share is credited to his individual account. Common provident funds are utilised for such purposes as superannuation,^ sick allowance,® grants on disablement,* or at death, ^ etc. In one case (No. 30) female employees when leaving to get married receive a grant from this fund. In other cases the fund is util- ised for a variety of charitable purposes. Under the majority of schemes in which the bonus is partly or wholly retained for provident purposes, each employee's share is credited to his individual account. In some schemes of thisi nature it is provided that the amount thus accumulated shall be* paid out to the employee when he attains a certain age,*^ or after a certain period of service with the firm.^ In one instance (No. 138) the rules specdally provide that an employee may obtain " Nos. 8, 21, 28, 82a, 148 and 158. " Nos. 10, 16, 30, 31, 46, 100, 116 and 134. In the scheme of firm No. 30 the whole of the bonus may be paid into the provident fund, at the employee's request. One third of the bonus is credited to a provident fund in the case of Nos. 22, 145 and 167. "= Nos. 16, 20, 33, 60, 106, 144 and 146. ^ Nos. 8, 20, 33 and 167. « Nos. 8, 20, 33 and 60. f No. 8. e Nos. 8, 20 and 33. ^ 60 years in Nos. 31 and 138 ; 70 years in No. 16. Scheme No. 10 provides that the amount shall be paid to an employee at the age when the Directors consider that he should retire. ' 25 years' service in No. 16 ; in the case of No. 30 the accumulated bonus is payable either (i) when the employee attains the age of 60 (55 in the case of a woman), or (ii) after 25 years' service, provided he (or she) has reached the age of 50 (45 in the case of a woman). In No. 145 (a new scheme) the " retained " part is to be allowed to accumulate for 25 years, at interest. 40 DETAILED REPORT. jK)sstvN>i()n of tlu> aiiKunii stiiiidiii^^ to his credit on permanent total (liMihh'iuont. Under fivo sclienies'* arrangements are made for the enii)loyee to receive hi> accuimilated bonus in the form of a priision instead of in a luuii) sum. In all cases provision is math' that in the event of death the amount standing to an riiijdo.vfo's credit slmll be i)aid to liis leg-al representatives. Althoug-li an employee may normally obtain possession of his (k'ferred Ixmuses on leaving-, various provisions are sometimes made, no doubt with the object of preventing employees from leaving simply for the purpose of obtaining possession of their money. In one instance (No. Ib8) an employe* who leavenS or is discharged, except throug-h ill-health or (if a female) to get mairied, nuiy receive tlie whole of ])is or her acciimuloted bonus only if he or she has comjjleted twenty years' continuous service with the Compajiy ; otherwise only a portion of the sum to his or credit may be claimed. In the case of scheme No. 82a employees who leave the firm receive only one-half of their accumulatefl bonus ; while under the rules of No. 22 half the amount of the employee's interest ; in the pension fund is forfeited if he leaves with the firm's ' consent, and the wdiole if he leaves without such consent, or is discharged. In other cases the firm reserves the right, should an employee leave, to defer payment of the amount due \ to him until after a certain period.^ In three cases (Nos. S2a, I'M and 158) it is definitely stated that female employees leaving to get married may obtain jwssession of their accumulated bonuses. Tlie majority of schemes under which part of the bonus is retained as a provident fund make no provision for the em- ployee to withdraw sums from the amount standing to his credit while he remains in the service of the firm. In two instances (Nos. 21 and 134) it is stated that such withdrawals may be made only in special ai)proved circumstonces, tlie latter scheme men- tioning sickness as a circumstance under which withdrawals , would ))e permitted. The rules of No. 46 provide that after thi-ee years an amount up to one-half of an employee's accumu- hited bonus may be withdrawn on giving one month's notice, but that no subsequent withdrawals may be made until another three years have elapsed. hwestment of Provident Funds. Both in the case of common provident funds and of funds .standing in the names of individual employees, the amounts are jjtmost invariably left in the hands of the firm. Usually the sums thus held by the firm are treated as deposits, interest being • No8. 10, 22, 2H, 82a and 167 ; in the first-named scheme the employee may receive his amount either in a lump sum or as a pension : see also footnote ^ on p. 39. »> Three months in Nos. 16 and 46 (in No. 16 payment will not be made until a fortnight after the next half-yearly stocktaking) : twelve months in No. 138 ; in scheme No. 31 payment may be deferred for 12 months if the employee leaves of his own desire ; and in scheme No. 134 the firm retains the right to defer payment for six months, but this provision is stated to be merely a safeguard and is seldom enforced. ANALYSIS OF SCHEMES NOW IN FORCfi. 41 credited at rates whicli vary frora 3 per cent, to Q^ per cent.^ In one case (No. 82a) the fund is invested pai-ily in shares of the undertaking and partly in War Loan; in the case of No. 22 the firm reserves the right to invest the fund as may he deemed expedient, and firm No. 16 simihirly reser^^es the right to de- posit the whole or part of the sum standing to the credit of any profit-sharer in a savings bank. In the case of No. 36 the money is held in trust by the Employees' Society (see pp. 72-5).; while in No. 28 it is utilised for the purchase of pensions in the Royal National Pension Fund for Nurses. Bonus Retained for Investment in Capital. As already stated, a number of schemes provide that the whole or part of the bonus shall be retained for investment, on behalf of the employee, in the capital of the undertaking. In a few cases^ the whole of the bonus is thus retained; while in one case (No. 106) the bonus is retained until an employee has acquired a holding of £50, after which he is at liberty to receive any further bonuses in cash. Employees in scheme No. 121 have the option of either taking their bonus in cash or leaving it with the firm for investment in its capital. In scheme No. 36 em- ployees who are members of the " Employees' Society " have their individual bonuses invested in the shares of the business, while the bonus due to non-members of the Society is credited collectively to a non-members' Provident Eund. In addition, jjart of the profits are devoted to educational, social, provident, propagandist, and other purposes for the benefit of the members of the society, or their wives, widows or dependants. (For further particulars of this scheme, see pp. 72-5). Shares Issued to Employees on Special Term^s. It has been pointed out' (p. 8) that the fact that employees hold shares in the undertaking with which they are connected does not, in itself, constitute Profit-sharing, but that the element of Profit-sharing comes in only when such shares have been acquired by the employee on specially favourable terms. This form of Profit-sharing, either alone or in conjunction witli the simpler type of scheme, has been adopted by many firms. In some instances shares are issued to employees without pay- ment of any kind. Scheme No. 121, for example, proA'ides for, tEe~gratu'itous issue of a number of shares to each employee after he has completed five years' seiwice; while in the case of No. 132 shares are issued free to all employees with two years' service,' with a further issue from time to time to .various employees (chiefly foremen) according to merit. Under scheme No. 150 shares are given to all employees with twelve months' service or over, in proportion to their salaries. In No. 88 shares are distributed to certain selected employees ; fifteen £10 shares are issued in each, year to which a dividend of 6 per cent, or more is paid on the ordinary share capital. * 3 per cent, in No. 10 ; 4 per cent, in Nos. 21, 30 and 46 ; 5 per cent, in Nos. 31, 134 and 146 ; 6t per cent, in No. 16. b Nos 138, 1-44, 146, and 169. In the schemes of firms Nos. 33, 80 and 160, the bonus itself is given in the form of shares. jj DETAILED REPORT. A ci-rliiiii iiiniil)i'r of schemes* provide for the issue of shares to emphnws iiimn fKiyment, but at a price below the «'\ctual market v;ilue of the shares. In the majority of such schemes, arraiigt'iiiciits are made for the employee to pay for his shares by iustalmeuts. (Schemes, however, in which the only advan- tuR-e circorded to employees is the permission to purchase shares by instalments, the full price beinj? payable, and no supple- mentary interest bein«3f allowed, are not regarded as examples of Profit-sharing for the purjioses of this Report.) In one case (No. 119) an employee is entitled to receive one gratuitous preference shore (colled a " service " share) for each year of satisfactory service, provided he has bought one pre- ference share for each "service" share applied for; that is to say, in effect lie gets two shares for the price of one. In the case of Nos. 39 and 99 employees are ollowed to apply for more shares than they can actually pay for at the time: the full dividend is paid on all the shares allotted, from the date of iillotment, ond, subject to the deduction of interest on the amount not paid up, is applied either partly or wholly in paying the balance of the purchase price. Where shares are specially issued to employees, provision is sometimes made for paying an extra rate of dividend, in addi- tion to the ordinary dividend, on such shares. An example of such an arrangement is found in scheme No. 99, under which, whenever a dividend of 5 per cent, or more is paid on the ordi- nary shares, the employee receives, in addition to the ordinary dividend, o bonus dividend at half the rate, making his total rate of dividend one-and-a-half times the rate paid on the or- dinary shares. In three instances^ employees' shares carry a cumulative preference dividend, and in addition are entitled to a further dividend dependent on profits, the extra dividend in one of these cases (No. 162) being paid at such a rate as will make the total rate of dividend on employees' shares enual to the rate paid on the ordinary shares. In this scheme llso, if there is any distribution of bonus shares, the employees share equally Mith the ordinary shareholders. "With No. 166 em- l)loyees receive, in addition to their preference dividend, a bonus dividend of 3 per cent, per annum on the amount paid up on their shares. In connection with the issue of shares to employees, mention may be made of a few schemes under which employees receive dividends without holding shares. In the cose of Nos. 75 end 127 employees are nominated to receive the dividends on a certain number of shares, but the shares remain the property of the firm and the employees themselves cannot hold them. In three instances*^ employees hold certificates which carry divi- dends, but are not markettible in the same way as shares held by the outside public. • Nos. fi. 13, «2, 162. and 16t^. " Nos. 82, lfi2, and 163. ' Nos. 8C, 92, and 160. ANALYSIS OP SCHEMES NOW IN FORCE. 43 In almost every case where shares are issued to employees, -either free or on special terms, there is a maximum limit to the total aggregate number of shares thus set aside. In a few instances a limit is also placed upon the total amount which may be held by each individual employee. Scheme No. 13, for •example, limits each employee's holding- to five £10 shares; while in IsTos, 124 and 162 the maximum limits (nominal value) are £100 and £1,000 respectively. In one instance (No. 166) not more than one hundred pounds' worth of shares may be held, hut provision is made for the wife of an employee to hold a similar amount in her own name. In tlie case of No. 99 the special rate of dividend on employees' shares is payable only ■on shares up to a total value equal to the employee's salary for the previous five years. Provisions against Transfer of Employees^ Shares. Wherever the issue of shares to employees forms the basis of Profit-sharing, it is almost invariably the intention of the firm ■that such shares shall be held by employees only. Three firms* embody this in the rules of their schemes. In some cases the transfer of such shares is either absolutely forbidden^ or is only permitted if the shares are passing into the possession of another ■employee" or of a person nominated by the Cbmpany or its Directors.*^ Employees wishing to sell their shares under scheme j No. 89a must first offer theni to the Trustees at their nominal value plus accrued interest. In schemes Nos. 33 and 146 em- ployees who have acquired shares to the value of one year's wages or salary may be permitted to sell or transfer any shares they may own in excess of this holding. In order to deter employees from selling their shares, one firm (No. 49a) states that in the event of employees attempting to charge or alienate their shares, the latter will be forfeited. In another case (No. 162) shares which have been transferred lose their right to the extra dividends payable on employees' shares ; while in the case of No. 82 the dividends wholly cease in respect of shares held by any unauthorised person. As a means of pre- venting any transfer of employees' shares, arrangements ere made in a few cases® for share certificates to be held in trust, instead of being issued to the individual employees. As a further provision against employees' shares passing into the possession of the outside public, many firms arrange to re-pur- chase such shares, or to control their transfer, should the owner die* or leave the firm's employ.^ But in order to discourage » Nos. 33, 106, and 163. '' Nos. 81 and 106 ; in the case of No. 88 shares may not be sold -while the holder is in the firm's employ. " Nos. 9, 13, 39, 121, and 132 ; in the case of No. 121 the consent of the Trustees of the scheme is required. ^ No. 163 ; the approval of the Directors is required before any transfer can take place. " Nos. 45 49a 81 and 124. f Nos'. 39', 48, 49a', 82, 106, 146, 163, and 166. No. 13, however, provides that the shares of an employee who dies may be held by his widow or heirs. e Nos. 25, 33, 39, 48, 49a, 82, 106, 119, 146, 163, and 166 ; in the case of No. 13 an employee who is over 50 years of age when he leaves is allowed to retain his shares, and such shares are not re-purchased by the Company until his death or, should he leave a widow, until the death of his widow. 4 J DETAILKD RKPORT. I emplovt'os from leaving'- llu' firm's om])loy in order to realise' tlieir shares, tiiio Hrm (No. '{-i) states tliat it will not undertake to transfer such shares until three mouths after the holder lia* left; while firm No. 14G re.serve.s the rig-ht to postpone the ' transfer for six mouths. In schouK' No. 4!)^/, the slinres of a deceased employee are tninsf<'rnNl ;it their " I'aii- " value, which, as, defined in the TrnsI DimmI, is Tioiinally the averaf?e market value. In most shaiflioldin','- scluMnes, howe^-er, the ^s.hares of a deceased em- |)loy<>c ai-c transferred at their nominal or par value. Votintj Rif/hts of Employees. Sluires a<'(|uired hy emi)loyees on specially favourable terms do not, in several instances," confer any voting rif,;:hts upon their owners. Under the pnivisions of scheme No. 121, altliough the shares carry A'otes, such votes may only be given through the Trustees of the .scheme, until the employee's holding amounts to £200, when he may apply to become a direct sliareholder. Votes can only be exercised through the Profit-sharing Com- mittee in No. 81, and through a Committee appointed by the- Directors in No. 138; in scheme No. 36 such votes are exercised ])y proxy through a representative of the Employees' Society. It should be observed that some firms do not state whether the shares wliich are held by their employees carry votes or not. Proportion of Capital held hy Employees. It would ai)pear that in very few instances do employees own a large proi)ortion of the capital of the undertaking for which they work. In two cases (Nos. 6 and 33) over half of the total capital is held hy employees; and in one case (No. 36) one-fifth of the capital is owned by the workpeople. Of the remaining' cases where information has been given on this point, the pro- poition is over 6 per cent, in five cases, ^ between 4 and 6 per cent, in four cases," between 2 and 4 per cent, in five cases,* and less than 2 per cent, in six cases.® Profit-sharing Deposits. A type of scheme which has been adopted in a number of cafes consists in payino- to employees who deposit money with the firm, first of all a fixed minimum rate of interest on such [deposits, an(l secondly a further ixite of interest varying with" the profits of the undeiiakinj?. The fixed rate of interest varies from 2.^ i)er cent. (No. 108) to 7^ per cent. (No. 114), but is usually either 4 or 5 per cent.' In four casess^ the total return • No». ?,?,. .H9, 82, 89. 132, and 146. In the case of No. 82, however, employee BharehoMers may attend and vote at meetings at which the rights of the holders of emplovee-shares are in question. *- Nos. "5. y./. 4«. f)-l, and 121. ' Nos. 13, 99, If'H, and 119. "• Nos. 2.V 42, .')3, 80. and lOr,. ' Nos. 12, 27, HX, 101, 13H. and 150. ' No. 1«. 3 per cent. ; Nn. 107, 34 per cent. ; Nos. 7, 49, .54, 74, and 109, 4 perjcent. : Nos. 2 and 42. 4i percent. : Nos. 81, 105a, 112, and 165. 5 per cent. ' Nos. 1«. 107, 109, and 114 : subject to the fi.ved minimum and maximum rat«9 in the case of Nos. 1)*, 107. and 114. i ANALYSIS OF SCHEMES NOW IN FORCE. 45- on the employees' deposits is at the same rate as the dividend on shareholders' capital. In other cases the total return on deposits is at three-quarters^ or halt^ the rate of dividend on capital, or is determined by a scale according- to the rate of dividend declared.^ The rules of No. 2 provide that the total rate of interest on sums deposited by employees will be not less than the rate of dividend on capital, subject to a maximum of 10 per cent. In three instances,^ after the fixed minimum rate of interest has been credited, an additional amount of interest is credited at a rate equal to half the rate by which the dividend on capital exceeds the fixed minimum rate of interest on deposits. In scheme No. 42, a certain proportion of the net profits is dis- tributed as bonus, and employees are encouraged to save this by the provision of facilities for depositing it with the firm. Sums so deposited are increased by 25 per cent., and the whole credited to an '^investment account"; interest is then credited at the rate of 4| per cent., plus a further rate of interest according as the rate of dividend on the deferred share capital exceeds a certain fixed rate. In scheme Np. 105a also, the rate of additional interest is the amount by which the dividend actually paid in each year exceeds a fixed percentage on share- holders' capital : in this case the " reserved " rate is the average rate of dividend during the four years ended June, 1905. An unusual scheme is No. 165, where the rate of additional interest is determined (subject to certain maximum limits depending on the dividend paid) by the length of the employee's service. In addition to a Tninimum interest payable on deposits, the rules of a number of schemes lay down a maxivvum rate for the total return on employee's deposits. In eight cases® the total rate of interest niust not exceed 10 per cent., and in one case (No. 114) 20 per cent. ; while 7 per cent, is fixed as the maximum in the case of No. 49. Various limits are placed by different firms upon the amount of money which employees may deposit under their schemes. Where a definite sum is mentioned as the maximum amount which will be received from any one employee this sum varies from £50 to £500.* In one instance (No. 108) an employee's ' No. 108 (subject to fixed minimum and maximum rates). b No. 74. "^ No. 54 (three-quarters of 1 per cent, additional interest paid for each 1 per cent, of dividend, free of income tax, over 5 per cent.). •1 Nos. 7, 49, and 112. ' Nos. 2, 7, 18, 42, 105a, 107, 108, and 165 ; in the latter case the total rate of interest must also not exceed the rate of dividend on ordinary shares. * £50 in the case of No. 42 ; £100 in the case of Nos. 49 and 109 ; £200 in the case of Nos. 54 and 105a. In No. 2 there is a limit of £4G0 for workpeople, but this limit does not apply to foremen. In Nos. 7 and 112 there are limits of £200 for employees paid weekly, and of £400 for those paid quarterly. In No. 107 not more than £100 may be deposited, except by special permission. In No. 114 the limit is £500 for those paid weekly or fortnightly ; those paid monthly may deposit not more than five times their annual salary. 46 DETAILED REPORT. total deposit may not normally exceed one year's salary or wages for every five years' service in the firm's employment; but em- ployees may make special application to the Directors for per- niis'sion to* dei)osit lump sums. In addition to limiting an individual employee's deposits, a feM" firms state that the total 1 agpregnte amount deposited under their schemes may not exceed a certain maximum amount; or they take powers to limit the aggregate amount, if necessary. Witli regard to the withdrawal of deposits, provision is almost invariably made for employees to withdraw sums from their accounts on short notice. One month's notice is required for any witlidrawal under Nos. 18 and 114, while the scheme of Js'o. 108 is exceptional in the fact that no amount may be with- drown under six months' notice. In these cases, however, the requirement may be waived in special circumstances or by special permission. In order to discourage employees from withdrawing sums from their deposit accounts, scheme No. 105a reserves the riglit to close the account of any depositor who makes with- drawals too frequently. Employee Directors; Joint Committees. Among the schemes, other than those of Gas Companies, dealt ■with in this Report, there are four cases in which employees are included on the Board of Directors. In one instance (No. 6) half of the directors are employees of the Company. In the three remaining schemes the number of employee-directors is two Tout of five) in No. 36, and one in the case of Nos. 48 and 52. •Joint Committees, consisting of representatives of employers can, under certain circumstances, be punished by fine or im- y prisonment under the Conspiracv and Protection of Property |; Act, 1875, (38 and 39 Vict., c."86, sec. 4). Unquestionably, however, the wide extension of Profit-sharing and Co-partnership in gas undertakings has been due, in large measure, not only to favouring conditions but also to the strong advocacy of the system by Sir George Livesey, the former chairman of the South Metropolitan Gas Company, which was the pioneer of Profit- sharing in gas undertakings. It is proper, therefore, to give a fiill account of the circumstances under which this scheme was introduced, and of its subsequent developments ; more particu- larly as all the subsequent schemes of Profit-sharing and Co- partnership which have been adopted in gas undertakings (with two exceptionst) follow very closely the lines of the South Metropolitan scheme. South Metro'politan Gas Company. At the beginning of November, 1889, the South Metropolitan Gas Company, which had already been giving its officers and foremen an annual bonus dependent upon its profits since 1886, adopted a scheme of general participatioin. In March, 1889, "The National Union of Gas Workers and " General Labourers of Great Britain and Ireland " was formed, and shortly afterwards succeeded in obtaining very considerable concessions in favour of men employed in gasworks. In the course of the autumn the Gas Workers' Union made certain demands upon the South Metropolitan Gas Company; these were not resisted, but the company's officials became con- vinced that further concessions which the company would feel unable to grant would probably be put forward by the Union, * A few schemes, on profit-sharing lines, are known to have been adopted in municipal undertakings, both for gas and for other services. Municipal schemes are not, however, included in this Report. f The Southend and the Watford Gas Companies also have profit-sharing schemes, but these are not based on the sliding-scale principle. V IS DETAILED REPORT. and that "a >tiik.' was lik.-ly to lake place' at any moment with- " out any warning." In onlt'i' lf> avert this contingency, Mr. (afterwards Sir) (Je(»rg-e Livesey, the chairman of tlie company, indtxvd the directors to assent to tlic adoption of a special system of Trofit-sharin^r; and an oli'er on the folhnving- lines was aecord- inKly made (on November 6, 1889) to all the regular staff. The shareholders (as the law then stood) were allowed to re- ceive a dividend of .10 per centw when the price of gas was not above ',i^. {id. per 1.000 feet, and an additional dividend of i jier cent, for each reduction of one penny per 1,000 feet in the price of fjas; the plan proposed was to give the employees a Iwnus of "1 i)er cent, on their year's wages "for even- penny reduction below 2^. 8d. per 1,000 feet" (the i)rice then i)eing 2s. M.). In addition, there was to be placed to the credit of every man who sjiould accept the scheme ing under signed agreements, and to officers who fulfil the conditions of the rules; and the Directors reserve the right to I refuse permission to any man to sign an agreement " who does ! "not take an interest in the welfare of the company and its " co-partnership, or who is wasteful of the company's property, " or is careless or negligent in the performance of his duty."|! There was at one time a clause in the agreement forbidding co- i partners to be members of the Gas Workers' Union; but all| restrictions on membership of this Union have long since been withdrawn. The form of agreement now in force is printed in Appendix E. (p. 206). The period for which the men engage themselves is, for the most part, twelve months; or, in the case of " winter' men," from three to six montlis. Various alterations were made in the scheme in 1894 and 1898, the effect of which was to give improved terms to those who left half their bonus for investment in the company's capital. Employees could also leave the withdrawable half of the bonus on deposit with the company, at interest, and could invest this, and their own savings, in the company's shares. It was at first found that a considerable proportion of the employees failed to avail themselves of the opportunity afforded them of leaving the withdrawable part of their bonus on deposit with the company. The company accordingly gave notice in August, 1899, that those participants in the bonus who, during the past five years, had regulaidy withdrawn all their withdrawable bonus, would at the next distribution, in 1900, have nothing placed in their withdrawable account unless they sliould deposit with the company, week by week, a sufficient sum to equal by June 30, 1900, a week's wages : it was, however, provided that, if a man should have withdrawn money to invest it otherwise, this notice was not to apply to him. Further, at the end of 1900, it was announced that " all those men who have withdrawn ** their bonus must deposit not less than G^. a week in the oom- " pany's savings bank to entitle them to the full bonus next " June." In the revision of the rules of the profit-sharing scheme- which came into force on the 1st July, 1901, the starting point ftO iJliTAILLD UErOltT. vi tho Ihhius scale was made 3^. Id. iusiead of 2s. 8d.; and instoail of llio two rate's previously in force (1 per cent, on wages if all the l»onus were withdrawn and lA per cent, if half were invostinl in stock) l)<)nus was fixed to be paid in future at one uniform rato, vi^., three-tjuarters of one per cent, on wages for ovej-y reduction of one penny in the price of gas below 3s. Iti. j>er 1,(XX> feet. At the same time the investment of one- half of the lx)nus in the company's stock was made obligatory for all except the winter men, and the minimum amount of stock to be j»urchased out uf accumulated bonus was raised from £5 to £10. With regard to the disposal of their stock by employees it was now i)rovided that " any man selling his stock to any outside " party, without the consent of the secretary of the company, " will at once cease to be a Profit'sharer . . . those who sell " their stock except for the best reasons, such as investing in " the building society or buying a house, and those who regu- " larly withdraw their half-bonus, will be struck off the list. " They may, how^ever, again become qualified by saving for two " consecutive years an amount equal to one week's wages in each *' year." By a later revision of the co-partnership rules, which came into force on July 1, 1910, an important alteration wsbs made in regard to the treatment of the bonus. Up till then, while one- half of the bonus w^as required to be invested in the company's stock, the other half might eitlier be left on deposit with the company or invested in stock, or might be withdrawn at a week's notice. Now it was laid down that this second half of the bonus is to be " left in the company's hands to accumulate at interest, " or it may be invested in stock with the trustees, or it may be " withdrawn under special circumstances by giving a week's '' notice." Co-partnership CoTrvmittee. — Th.e sdieme, from its very outset, provided for the appointment of a Profit-sharing Committee (the name of which, was in September, 1903, chaaiged to " Co-partner- ship Commitftee ") and for tlie election of auditors to supervise the accounts, the terms of these provisions being as follows : — " 11. A committee of management eliall be elected, to consist of the " chairman of the board of directors, and 17 members elected by the board, " and 18 members elected by the profit-sharers in proportion to the numbers " at each station, who shall be elected by ballot; one-third of the members " of tlio committee to retire by rotation every year, but to be eligible for '• re-election. Seventeen members shall constitute a quorum, of which not " less than eight shall be workmen, and every resolution to be binding at " such meeting shall have for its support a majority of the members of " the committee present at, and voting ujion, the resolution. " 12. The committee shall appoint a secretary, who shall have no power " of voting. " 13. In the event of any difference arising as to the construction of " these rules, it shall be referred to the committee, whose decision shall be " final and conclusive. " 14. There shall be two auditors, one to be elected by the workmen, " the other to be appointed by the company, whose duty will be to compare ' and initini the workman's pass-book with the general account . . . DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 51 " 15. The committee shall meet for the transaction of business when " summoned by the secretary, but not less than twice in each year ; and " on a requisition of 20 employees or three of their own number at any " time. " 16. The secretary shall receive all notices, summon all meetings of the *' committee, and obey the orders of committee in all other matters and " things whatsoever." In 1910 the number of members of tbe Co-partnersliip Com- mittee was increased from 36 to 54; and it was provided that '' candidates must hold and continue to hold while in office on '' the Committee not l-ess than £25 of stock, and they must hawe-j ; " been not less than five years in the company's service." The number has sine© been increased to 60; and, in December, 1918, it was temporarily raised to 82, so as to include representatives of the large number of women workers who had been taken on// during the war. The men's and the women's representatives sat : together at ordinary meetings of the Committee and also at meet- ings of the employees' elected representatives, who meet by themselves in the week preceding the fixed monthly meeting of | the full Committee. In addition to this the women were per- mitted to meet alone once a month to discuss matters particular to their sex. Speaking generally, a large part of the functions of the Co- partnership Committee consists in smoothing away friction which may arise between individual workmen and their employers, and in removing suspicions entertained by a work- man that he is not being treated fairly. For this purpose a very important part is played by the workmen's representatives on this Committee, to whom the workman who thinks himself hardly dealt with applies in the first instance. In very many cases a talk between the workman and the representative on the Co-partnership Committee of the class of employees to which he belongs suffices to allay the man's discontent. Should this not be the case, the next step is for the representative before whom he has laid his case to put the matter before the superin- tendent or other official in charge of the department of the works in which the workman is employed. If the interview between the official and the representative should fail to produce results satisfactory to the complainant, then the case is brought before the Co-partnership Committee. But the necessity for this step occurs but seldom, most cases being settled in the manner above mentioned. When complaints have come before the Committee its decision has always been accepted without demur. In a certain number of oases, however, the matters which have come before the Co-partnership Committee have concerned, not individual workmen, but the employees of the company as a whole. In this manner the rules of the Superannuation Fund of the company have from time to time received necessary revisions. Among the many useful tasks that have been performed by the Co-partnership Committee has been the settlement of the rules of the company's Accident Fund, and the subseqiient revisions of these rules necessary to adapt them to be certified^ (as they have been) as a Contracting-out Scheme under the Workmen's 52 DETAiLHi) iu:pout. Coiuiu'iisitioii Acts. In rt'lation to this Scheme the Co-partner- sliip Coiiiiiiittoo acts as referee in cases of disputed benefits, the ontire adniiiiistiation of tliis Accident Ftmd being- 'left in its hniuls.* In ^'ivin^- ovidemi' before the Select ('(mmiitteo on Gas XJnder- t-akin^'s (Statutory Prices) in May, 1918, Ur. Carpenter, the Chairman of the Coniiiany, spoke as follows with reg-ard to the Co-i)artnersliip Committee, in rejdy to a (|uestion sugg-esting that the fact tliat the members were emijlojees, subject io dismissal like any other emi)loyees, might make it a little dillicult for thom sometimes to voice the grievances of their fellow- workmen : — " I wish the Committee could be present at one of the " meetings, and they would be most interested at th.e out- " spoken manner in which the men do speak. "When one " talks of difficulties with working men in the country it is " because they do not understand one another, liecause they " do not have an oi)i)ortunity of saj'ing what is wrong. Their " grievances are bottled up and they have no oii])ortunity of " blowing them off, and then you get a wound which festers " and is troublesome. But certainly in our case they do " not mind what they say. I think I might give an example "of it with regard to the military service difficulty. Our " men are being impressed with the number of men of " military age still in our employ, and they formed a com- " mittee of four of our employees under the presidency of " one of the officials whose duty it was to go round the " different works and satisfy themselves as to the ages of *' employees and officials. That is the interesting part of " it ; they did not stop short at the man getting so much a " week, but they dealt with officials earning 'several " hundreds a year, they dealt with everybody of military " agte in fhe compaaij^'s service through the medium of " the "Workmen's Committee luider the presidency of one " officer. They dealt with 2,200' cases, and they came to " the conclusion that there were something like 700 or 800 " of militai*^- age, of whom some 400 or 500 were, in their " opinion, not indispensable men. I give that as an example " that they do take up a very upstanding and independent "attitude.'" • In connection with this Accident Fund a system of "Juries of Workmen " is in force. The rules of the Fund provide that an inquiry shall be made into every accident that is a charge on the Fund, and may, at the discretion of the Company's engineer, he made into any other accident. Every jury shall include at least one memher (but not more than two) of the Co-partnership Committee ; a number of workjwople (but not more than four) from the department in which the injury occurred, and the remainder (making the number up to 12) in order from the Jury List. The duties of a jury include that of investigating the circumstances causing the accident, and stating ^vhether any blame attaches to any official or workman, or whether the plant, machinery, or means of protec- tion were defective ; and if, in the opinion of the jury, anything can be done to prevent a similar accident in future, they are to make such recommendation as hey may consider necessary. DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 53 Eviployee-Directors. — On Aiig-ust 27tli, 1898, a scheme for the election by the officers and workmen of the company of i employee-directors, mode under the provisions of the Company's I Acts of 1896 and 1897, came into operation. This scheme was to continue in force for three years, and was renewed in 1901. In 1907 the schemie was again renewed for a further period of 43 years. It is, however, subject to prior determination should the employee-shareholders reduce their holding of stock below certain specified limits. The number of emi^loyee-directors is not to exceed three, of whom one shall be a salaried officer, and the other two employees in reoeij)t of weekly wages; and it may be reduced below that number if the amount of stock held by the employees should decrease. With respect to the qualification of an employees' director it is provided that : — " The qualification of an employeea' director shall be two-fold, the " having been continuously not less than 14 years in, and continuing " in, the employ of the Company, and the having held for not less than " 12 months prior to the date of election, and the continuing to hold, " not less than £120 stock of the Company, accumulated under the " Cb-partnership scheme. As the aggregate holding of stock [by em- " ployees] increases, so shall the qualification ... of employee- " directors increase in the following proportion: — - Aggregate holding £200,000, qualification £120. „ „ £300,000, „ £140. „ „ £400,000, „ £160. £500,000, „ £180. One-tenth of capital or more, ,, £200." The whole question of the value of the system of employee-1 ■directors was discussed at two recent meetings of the Co-part-' nership Committee, in September and October, 1919. Dr. Carpenter (who is chairman both of the Company and of the, Co-partnership Committee) said that the ordinary directors were^ chosen because of their knowledge of the business of the Company on its financial side, a side on which the employee-directors necessarily had less experience. On the other hand the employee- directors could exert a very real and weighty influence on the policy of the Company, in regard to the employees, because they'i possessed an intimate knowledge and experience on many points j in this connection, often beyond that of an ordinary director.' The usefulness of this was fully recognised and relied upon in the discussions of the Board. The Secretary of the Company endorsed the Chairman's views, and testified to the value of the employee-directors, aind the adv^antage of thus bringing the management into close touch with the employees, and the employees into direct contact with the management. The number of persons employed by the company in 1918 varied between 7,484 and 9,110, of whom 8,350 would have been entitled to share in profits on the 30th June, 1918, if any bonus had been payable under the scheme. ;, 1 DETAILED REPORT. In the 29 years from 1889 to 1917 inclusive, the total amount paid as bonus under the scheme, including the "nest-egg" of .t'(;.S(;;{ i)aid in 1889, was £771,804, the ratio of bonus to wages or sahirics varying from 2^ to 9J per cent. In no fewer than eightoon yoiirs, viz., from 1896 to 1914 inclusive, with one exception, it was at the rate of 7^ per cent, or over. No bonus was i)aid in either of the years ended) 30th June, 1918 and 1919, owing to the raising of the price of gas over ds. id. per 1,00& feet — the base price. In all, 5,400 of the company's employees hold between them / ordinary stock of the company to the (nominal) amount of I £42-'). 000 in their own names. In addition the trustees hold j £27,000 on behalf of 6,590 employees, many of whom also hold stock in their own names; and further, the company holds on behalf of 8,100 of its employees deposits (accumulated bonus and other savings) to the total amount of £70,000. "With regard to the share in the control of the affaire of the company possessed by its employees, it is estimated that out of the total number of votes which could be given at a general \. meeting of the shareholders the proportion representing the voting Astrength of the employee-shareholders is about 7 per cent. ; while ' of the ten directors of the company three (one official and two workmen) are representatives elected by its employees. Eight employees of the Company, in all, have served as employee- directors, since the scheme for the election of employee-directors came into force into 1898. The company have recently started a new arrangement for the deposit of savings with the company. This is not intended to supersede but to supplement the present system, which has been in force for many years, of accumulating savings (which may be credited to the " withdrawable " side of the co-partnership pass book), either in cash or by small deductions from wages. That system will continue in force, and money so deposited may be withdrawn as heretofore. The new system differs from the older one in several respects. The account will be kept apart from the co-partnership, and a special pass book will be provided for the depositor. The mini- mum sum that can be carried to this account from wages or salary has been fixed at 2^. 6d. per weeL Cash deposits may also be inade. One month's notice of withdrawal must be given,, but subject to that condition any portion, or the whole, of the money deposited may be withdrawn at the wish of the depositor. Accumulations of voluntary savings, now credited in the co- partnership pass book, may be transferred to this deposit account, hut nnt hnjiiia accximnlatinns:. The rate of interest will be 5 per cent, per annum, which will \n- credited on each complete pound, as from the first day of each month. DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES, 55 Other Gas Companies. The other gas companies' co-partnership schemes* follow closely the lines of the South Metropolitan, the pioneer company ; but there are various differences of detail, as regards the hasis of distribution, the retention of bonus for investment, reetrio- tions on sale of shares, the proportion of withdrawable to non- withdrawable bonus, conditions attached to participation, and so on. " Maximum Dividend " Companies. — It should be noted that in ten of the co-partnership gas undertakings — 'Cambridge, Cardiff, Chester, Gloucester, Grantham, Hertford, Leamington, Swansea, Weston-super-Mare, and Wrexham — ^the dividends payable to shareholders are not controlled by a sliding scale, these undertakings being what are called " maximum dividend" companies. The operation of the *' m,aximum divi- dend " system, with individual variations which may be left out of account for the present purpose, is, broadly speaking, as follows : — The maximum dividend which the company may pay to its shareholders is fixed, and also the maximum price which the -company may charge for gas. When the profits of the company are more than sufficient to pay the maximum dividend, the ex- cess, up to certain fixed amounts^ is employed in building up a reserve, for equalisation of dividends ; companies working on this system being permitted to pay, out of the pixDfits of future years, any deficiency by which the dividend paid in a bad year falls short of the maximum dividend. After the fixed amount re- quired for building up this reserve has been set aside, the whole of the profits in excess of what is required! to pay the maximum dividend are obliged to be employed in reducing the price of gas. The profit-sharing bonus paid to the employees in these maxi- mum dividend companies goes up and down inversely as the price of gaSjt just as in the sliding-scale companies; and it will be evident that, so long as the dividend is at the maximum — and this, in normal times, was the case with a majority of these companies — the employees have the strongest interest in reducing the cost of production and thereby increasing the company's profits, since the whole of the surplus profits are applied in reducing the price of gas, a reduction which automatically in- creases the employees' bonuses. Where the dividend is not at the maximum the employees' interest in increasing profits is not so direct and immediate; but it is, of course, to their interest to prevent the price of gas being raised (thereby reducing their bonuses), so far as they are able to secure this by good work and by effecting economies. * Except the Southend and Watford schemes. The Southend scheme is at present suspended ; for the Watford scheme, see pp. 60-1 below. t It should be noted that the maximum price of gas under the company's Act of Parliament is not necessarily in all cases the price at which the profit- sharing bonus ceases to be payable. Thus, in the Cambridge scheme, the maxi- mum price which may be charged by the company for gas is 4s. per 1,000 cubic feet, but the profit-sharing bonus ceases to be payable when the price is at or over .3s. 4d. ; while in the Wrexham scheme the maximum price to consumers is -4s., but bonus ceases to be payable to employees at 3s. 56 DKTAILED REPORT. Basis of Distributiou. In every scheme, except that of the SoiiiluMid (ias Coiiipaiiy, tlie bonus is distributed in proportion to the waj^'os or walarios of the participants. In calculating the bonus, it i.s pmvidod in nearly every case that overtime shall be exchnkMl; and in the larpe majority of schemes those employees who are on piecework have their bonus calculated on the amount they would have earned at the ordinary rates of wages in the retrular working hours. The Liverpool Gas Company excludes not only overtime and piecework, but also war wages, or war lM)nus, in calculating the amount due to each emi)loyee. Nearly every s( heme provides that, in calculating the bonus, no deduc- tion shall be made on account of absence due to sickness, pro- vided such absence does not exceed a certain limit. Two calendar months is the period usually allowed, but in the Cardiff scheme the limit is six weeks, and in the Eedhill scheme one month. In the case of the Aldershot and Bournemouth schemes time lost througli sickness will be allowed for "at the discretion of the Directors." Retention of Bonus for Investment. — In some schemes the w holt' of the bonus is retained by the Company for investment, Ihis is the case, for example, in the Cardiff, Eastbourne, Rugby, Walker and Wallsend, Wellingborough, and Wandsworth, Wimbledon and Epsom Gas Companies' schemes. In the Merthyr Tydfil, Eedhill, Tunbridge Wells, and Wrexham schemes the first five annual bonuses are thus retained. In several schemes the whole of the bonuses are retained until a sum has been accumulafted sufficient to purchase one or more shares, at market value The qualifying amount varies, but is most commonlj' £5 worth of stock. Such restrictions are found in the Gas Light and Coke (London), Aldershot, Bournemouth, Cambridge, Croydon, Harrow, Hertford, Ilford, Ipswich, New- market, Swansea, and Weston-super-Mare schemes. The pur- pose of this restriction is, of course, to hasten the accumulation of a sufficient amount to purchase a minimum quantity of stock : without such a restriction the sums accumulated would be so small that it would be some j^ears before the employee was able to pun base even a small quantity of stock. The restriction has the disadvantage, however, of discouraging the lower paid em])loyees, who, of course, take the longest time to accumulate the minimum sum required to buy stock, and who are also the most likely to be attracted by the gratification of handling a Ixinus either in cash or in a withdrawable savings bank balance. Some of the companies which impose such restrictions report that, so far from their schemes tending to lengthen the period during which their employees remain with them, it has rather had the opposite effect, at any rate at the start, since men leave In order to realise tbeir Iwnus, which they could not otherwise hanrlle for several years. Proportion of Capital held by Employees. — The South Metros IKilitan is the only gas company in which the amount of stock acquired by employees through Profit-sharing exceeds five per cent, of the total capital. In seven companies employees now I DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 57 lioltl betweeii two and five per cent, of the total capital ; but in a;ll the remaining- companies the proportion of capital so held is less than two per cent. Kestrictions on Sale of Shares. — Nearly all the gas companies forbid the employee-shareholder to sell his shares without the company's consent, or impose a penalty for so doing': and in many cases he is forbidden to sell at all except to another co-partner. The penalty is usually removal from the list of co-partners, either immediately or at the end of the employee's current period of agreemeut. In some schemes, however, the employee who has been struck off the list of co-partners in this way may be reinstated after an interval, or can be reinstated by depositing a specified sum. In six schemes fhe penalty is not enforced in the case of employees who sell their shares for the purpose of investing in a building society, purchasing a house or land, &c. In some cases it is stated that the company will abandon co- partnership if it is found that a large proportion of employees sell the shares they have acquired through the scheme. Share certificates are retained in the custody of trustees in the case of the Cardiff, Merthyr Tydfil, Eedhill, and Swansea companies. "Withdrawable" Part of Bonus. — This is usually one half; but in the Gas Light and Coke Company's scheme (London) it is only a quarter. In the case of the Bournemouth Gas and Water Company, it has recently been arranged that, after a man has purchased one share in the Company, the balance (after pay- ing his contribution to the Pensions Fund) can be withdrawn by him on request. In one scheme (Croydon) the withdrawable part of the bonus is paid in the form of a warrant or cheque ; in most of the remainder it is entered in the employee's pass-book (in a separate account from the " investment " account), and is withdrawable at a week's or, in a few cases, a fortnight's notice. In several other schemes, on the other hand, in addition to the South Metropolitan, it is only withdrawable by special permission, which is only given when the company are satisfied that the circumstances justify it. In many schemes, even where there is no such strict limitation on withdrawals, it is provided that an employee will be struck off the list of co-partners, tem- porarily or permanently, if he habitually withdraws his bonus ; or that the whole scheme may be terminated if the co-partners generally withdraw their bonus in this way. Conditions attached to Participation. — Except in the case of " winter men," i.e., men taken on during the winter pressure, the workers are generally required to enter into an agreement fc«r twelve months if they wish to enjoy the benefits of the co- partnership scheme. In the Waterford scheme, however, the agreement is only for six months, and at Liverpool for four months. At Shrewsbury the agreement is not for any stated period but until determined by one month's notice on either side; while at Rugby employees are not, in practice, required to sign an agreement. 24335 C :>« DETAILED REPORT. In most eases where luug-tonu u^^ieemeuts are required there iti ii ]»r<)visiou that employees may leave before the termination of their agreement, oii obtaining the permission of the manage- ment. In such cases, liowever, they sometimes forfeHt part or the whole of their bonuses for the current year. \\ ith several conijianies it is .sjtecifically provided that the bunu> for the current i)eriod will be forfeited in case of breach of agreement or dismissal for misconduct. The majority of schemes provide that employees who are wasteful or careless or negligent in the performance of their work shall not be allowed to particijtate ; or that an emjiloyee's Ikuuis may be forfeited to make good any damage caused by his carelessness or wilful neglect. Casual employees are excluded from participation in the Canterbury, Croydon, and Harrow and Stanmore Companies' *;chemes. In the case of the Canterbiiry scheme, the clerical and office staff are also ex(duded ; while with the Gloucester (Company employees who earn more than £200 i)er annum are not allowed to participate. In the Leamington Priors and Rugby Gas Companies' schemes no employees who are under 21 years of age may become co-partners. In the Chester and Wrexham Companies' schemes it is provided that employees in order to ])artiri]>ate must be members of an approved benefit society. Provisions as regards " Winter Men." — The rules of the scheme in force with the Commercial Gas Comi)any (London) provide that men serving under short term agreements shall be entitled to the withdrawable half of the bonus only. With the Aldershot, Bournemouth, Gas Light and Coke (London), and AVaterford Companies, winter men are entitled to the full bonus provided that the whole of it is left with the company; but if they elect to take the withdrawable part in cash they forfeit the remainder. The withdrawable half bonus for winter men is limited to an amount equal to 4 per cent, of the wages at Leamington and to 5 per cent, in the Waterford Company's s<'heme. Facilities for Investing Voluntary Savings. — As in the South Afetropolitan scheme, employees in practically every company are encouraged to deposit voluntary savings, in addition to the profit-sharing Iwnus, at a fixed rate of interest. Money which is deix)sited in this way is withdrawable at short notice; but upon application from the employee arrangements will usually be made for investing the whole or any part of such savings in tlie ronipniiy's shares. Employee-Directors.— The South Suburban Gas Company (Ixmdon) is the only Gas Company, apart from the South Metroiwlitan. in which employees are represented on the Board of Directors. {Sec Ixdow, p. 60.) Co-partnership Committees.— Co-partnership Committees, usually consisting of equal numbers of directors' and work- men's representatives, exist in connection with everj' gas DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 50 company's scheme. In g-eneral their fnuctions are similar to those of the South Metropolitan Company's Committee, as described on pages 50-2. Features of Particular Schemes. — The following points of special interest appear in certain schemes: — Bournemouth. — Several alterations have recently been made in the scheme, on the recommendation of a Committee of em- ployees and staff who were appointed last winter to' suggest amendments. The distinction between the "free" and) the investment " portion of the bonus is now withdraAvn, and it is provided that, after paying two-thirds of the employee's contribu- tion to the Pension Fund, the remainder may be withdrawn, in whole OT in part, on seven days' notice. The employee must, however, first have accumulated enough to purchase one of the Company's shares. The Co-i>artnershii) Committee is increased from twelve to twenty-four (half being members elected by the Avorkmen) and is re-named the " Management Committee " ; and the employees' representatives fonn a permanent sub-committee, who are aiithorised " to discuss and make recommendations on any matter affecting' the interest of the employees, including wages questions." Canterhury. — The bonus in this case depends on the " uni- form " dividend of the company, which suj^plies both gas and water. The dividend payable by the water undertaking- cannot exceed a fixed maximum of 8 per cent., while the gas under- taking is on a sliding scale. Wlien the sliding scale permits a dividend of (say) 6 per cent., the " uniform " dividend is the mean between this and 8 per cent, (the maximum for the water undertaking), i.e., 7 per cent., and the bonus is half this percentage on wages or salaries. That is to say, in the case supposed, the bonus would be at the rate of .3A per cent. On wages or salaries. Cardijf. — The whole of the bonus is retained for investment, but in special circumstances withdrawals may be made with the consent of the Ct)-partnership Committee. Employees are not allowed to sell their stock without the consent of the C'o- partnershii^ Committee. Commercial Gas Company (London). — It is expressly provided in the rules of this scheme that no objection will be taken to employees joining a trade union. Croydon. — This company has a pension fund, two^hirda of the employee's contribution to which is first deducted from his (undivided) bonus. The remainder is accumulated until it is sufiicient to purchase a holding of £b in one of the company's ordinary stocks; further bonuses are then divided into two equal parts, one of which is retained for investment, and the other paid by cheque or warrant. An employee forfeits the whole of his interest in the pension fund if he assigns, charges or alienates the same. 24335 C 2 80 1)Kt.\iij:i) ukport. (irtintluini. — This (•(>ini)aiiy's scheme provides that — " no inoiipy or slock in lesjjecl of this [the investment] half " oi the honus shall l)e withdrawn by a co-partner, unless "he is loaviiif,'- the company's employ; and then only if " lie has had five years' service, excepting under special " circumstances, and with the sanction of the directors of " Ihe com]inny; and any such Ixmus or stock thus forfeited " >hnll form n pool, to he divided equally once every five " years amongst such of the co-partners of the company " who may have been in the employ of the company for " the five years preceding the date of such distribution." Lcaviinf/ton Priors. — Under this scheme employees may pur- cluiso either ordinary shares or debenture stock. Liverpool. — The bonus in this scheme is paid half-yearly. South Siihiirbdn Gas Couipany (London). — This Company has two* employee-directors. The Co-portnership Committee has been designated as the " Works Committee " for the underttikiug, under the Whitley scheme, when the time comes for works committees to be appointed. The Co-partnership Committee has a permanent sub-committee consisting of the whole of the employees' elected representatives, wlio are empowered — " to discuss and make recommendations on any matter " affecting the interest of the employee co-partners, or other " subjects concerning the co-partnership system, which may "be authorised by the Co-partnership Committee." This sub-committee meets as often as required. The elected representatives of the co-partners " have the right to make representations to the managing " officials on any grievance, individual or general, or other "matters affecting the interests of the co-partners in their "respective departments; and, in the event of failure to " obtain a sotisfactory adjustment, they shall be empowered to appeal to the Chairman of the Company. If agreement " is not tlien attained, the matter shall be referred to the " [Co-partnership] Committee, whose decision shall be in the " form of a recommendotion to the Board of Management "or to the employees concerned." ]\'(in(Istrorth, Wimbledon and Epsom District. — Sums can only be withdrawn in cases of " grave necessity." An employee lyorrowing from a monej- lender on the security of his stock certi- ficate is liable to be disqualified from participation in the profit- sharing scheme. Watford. — Under this scheme on employee receives a bonus equol to 3 per cent, .of his total wages or salary. Two-thirds • The Company's Act of 1904 permits the election of three employee- directors, two from the employees in receipt of weekly wages and one from the salaried staff ; but at the present moment the salaried staff have no representa- tive on the Board. DETAILED ACCOUNT OP CERTAIN EXISTING SCHEMES. (U of this bonus is retained by the Company for investment, and one-third placed to a withdrawable account. The bonus is paid half-yearly. This section of the Report may fitly close with the following letter received from Mr. D.. Milne Watson, the Governor of the Gas Light and Coke Company (the largest gas undertaking in the United Kingdom), under date of the 10th November, 1919, which the Department is permitted to quote: — " I am obliged to you for giving me the opportunity of "stating my views with regard to Co-partnership as applied "to this Company and, I believe, to many other Companies " in the gas industry. "We are satisfied that the working of our Co-partnership " scheme has tended toi produce better working relations "between the Company and its employees, and has united " the interests of the Co-partners and the shareholders. " When I tell you that our scheme only came into operation " in 1909, and at the present time there are 8,680 co-partners, " holding £183,000 in stock and having £103,600 deposited " with the Company, for which they are paid interest, you " will realise that considerable progress has been made and " that such a large holding must give the workmen an " increased interest in their work. " I do not say, of course, that Co-partnership is a panacea " for all troubles, but there is not the slightest doubt, fro-m "our experience, that Co-partnership brings about a better " understanding between Capital and Labour, and if more " generally adopted would go a long way towards overcoming* " some of the industrial difficulties of the time." (b) Profit-sharing and Co-partnership other than in Gas Undertakings. (1) Savings or Deposit Schemes. Of the schemes existing in firms and companies other than those connected with gas undertakings, a certain number are based on the encouragement of savings or deposits. The employ- ing firm or company agrees to receive savings, or deposits, at a fixed minimum rate of interest, which is guaranteed whatever the profits may be; and in addition to pay a contingent supple- mentary rate, varying with profits, if the profits exceed a specified level. Sir W. G. Armistrong , Whitivorth and Company, Ltd. This well-known Company of engineers, ordnance manu- facturers, and shipbuilders, of Newcastle-on-Tyne and Oi>enshaw (Manchester), have had a system of jjrofit-sharing deposits in operation for over forty years. The scheme was first started at Openshaw, by Sir Joseph Whit- worth, before his business was turned into a limited liability company. He told his workmen, in 1878, that, if they liked to 24335 G 3 62 DETAIIiKD RKPORT. invest i)art of thoir wages in the firm, he would be their savings bank, and wouhl give them the same dividend that he got him- self on his own (•ai)ital. The business was turned into a limited r-om])any in 18M8 under (lie style ot Sir Joseph AVhitworth and Company, Jiimitcd. wliich continued the system just described. The rules of the company i)rovided that dei)osits of not less than Ia-. and not more than £1 of the depositor's weekly wages would 1)€ iieceivtHl each week from persons in the employ of the company, and that, on each declaration of the annual dividend by the comjjany, interest would be allowed ecial circumstances. Persons leaving the employ of the com])any were to be repaid their dei^osits, with interest, at the expiration of fourteen days. In 1896 the business of Sir Joseph AVhitworth & Co., Limited, was amalgamated with that of Sir W. G. Armstrong, Mitchell & Co., Limited, and the combined undertaking was registered under its present title of Sir AV. G. Armstrong, Whitworth and Co., Limited. The scheme of profit-sharing deposits above referred to was extended by its aj^plication, in a form slightly modified, to the whole of the employees of the amalgamated company. Under this scheme deposits of not less than Is. and not more than £1 of the depositor's weekly wages are received each week from persons in the employ of the company, the maximum amount which may be deposited being £200; in the case of officials paid quarterly these limits aiie raised to £2 a week, and £400, respectively. The directors, however, reserve the right of fixing a limit to the totiil amount which will be received. The dejwsits carry a fixed interest of 4 per cent., and, in addition, a Iwnus is declared each year equal to half the difference between this fixed rate and the dividend jjaj'able on the shares of the company, but so that interest and bonus together shall not in any case exceed 10 per cent. Interest and bonus are added to depositors' accounts unless they give notice to withdraw in cash. Deposits can be withdrawn u]) to one-half on seven days' notice, or the whole on fourteen diiys' notice: under special circum- stances no notice is required. Persons leaving the employ of the company will be rep;ild their dejiosits at the end of fourteen days.* • The pcheme is printed in full in Appendix E, pp. 191-2. In this case the employees' deposits are unsecured. In other cases they are secured ; an example will he found in Appendix E, on p. 211, where a form of agreement is given formerly used by n company which allowed its employees to invest in its debentures (£.5 per cent.), promising to pay the employee debenture bolder, in addition to this fixed interest, the difference between this interest and the rate of dividend paid on its ordinary shares. For a case in which the employees' deposits are secured by debentures of the employing company, see p. 77. DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. G3 The total amount of bonus paid in 1918 (i.e., sums paid on employees' deposits over and above the fixed minimum rate of 4 per cent.) was £17,187; and the total amount on deposit with the company at the end of December, 1918, was £581,908. The number of eniijloyees to whom these deposits belonged was 12,215, of whom 3,035 were women and g-irls. The average number of employees of all grades in constant employment during 1918 was approximately 69,000, of whom about 18,000 were women and girls. The employees of the company havo also made investments in its securities, apart from the profit-sharing deposits described in the text ; these investments (the amount of which it is not possible to state) were made on the same terms as in the case of the general public. Fox Brothers and Company, Ltd. Une of the oldest schemes of Profit-sharing in existence in this country is that introduced in 1866 by Messrs. Fox Brothers and Company, woollen manufacturers, of Wellington, Somerset (converted into a joint-stock company in 1896). The firm had for some time allowed their managers, foremen and clerks to receive a bonus calculated in pai-t according to their respective positions, in part according to the year's profits. In 1866 they introduced a plan of receiving from their workpeople sunis of money on deposit, to bear a rate of interest never less than 4A per cent, nor more than 10 per cent., but within these limits varying '' in accordance with a certain fixed scale based on profits, which '* has been prepared by Messrs. Fox Brothers and Company." The firm undertook to repay any siim up to £50 on seven days' notice, above £50 on two months' notice. The supplementary rate of interest (varying- with profits) is now only allowed on " investment accounts," i.e., amounts of £5 or upwards, and not on small sums left in the " savings accounts," which receive only a fixed rate of 4^ per cent. New rules came into force in 1916. The limit of the amount that may be withdrawn from investment accounts at seven days' notice has been raised to £100 : one month's notice is now re- quired for the withdrawal of amounts over £100. A limit on the amount that may be invested by an individual depositor under the profit-sharing scheme has been fixed, mz., £400 in the case of ordinary workpeople, with a higher limit in the case of foremen. Sums over this limit may he deposited, but re- ceive only a fixed rate of 5^, per cent. The number of workpeople in the employment of the com- pany in 1918 was 1,423 (622 men and boys, and 801 women and girls). The number of employees who had taken advantage of the profit-sharing scheme, and who participated in the bonus, showed no great change until 1918, when a remarkable increase took place, the number of men and boys participating showing an increase from 229 to 430, and the number of women and girls from 95 to 398 ; and the total deposits of the employee-depositors reached the large sum of £60,600. This is exclusive of deposits exceeding the limits mentioned above, to which the fixed (non- profit-sharing) rate of 5J per cent, applies. 24335 C 4 64 I)i;taii-i;i) report. A iiuMiiluT of tlio firm, Mr. Joseph II. Fox, expressed his opiuion of tho scheme as follows in an address* j^iven before the Social Science Association in 1881, After mentioiiinj^- that the .system had heen thoroug-hlj- appreciated by the workpeople, Mr. Fox continued : — "Sccondhj. — Thoio has been scarcely any trouble experienced in carry- ing it out, and I am not aware that there has ever been any complaint made of the rate of interest given, although this has varied from 4^ per cent, to 10 i>er cent., nor am I aware that it has ever been sug- gested that the rate of interest was unfair or any wish expressed to know how it was calculated. The decision of the partners has in all c^ses been accepted without question. " Thirdly. — It has on one or two occasions hap}>ened that, when a high rate of interest has been paid, applications for increased wages have followed, it, no doubt, being thought that, as the business had been prosperous, a better rate of wages could be afforded. " Foiirtlily. — It is very difficult to form an opinion as to the effect produced on the carefulness and attention of the workpeople, and whether in this sense the scheme has answered. I believe it has in the case of many of the foremen and others in places of trust; but these have had, it must be remembered, an additional stimulus from their being partly paid in accordance with results. But with the ordinary workpeople there is not so much scope for showing interest, and as they nearly all work by the piece, it can produce but little effect on their industry. There are, of course, many ways by which economies may bo effected — by the saving of material, by care of machinery, and in other ways; but it is very difficult to form a definite opinion as to the results of the scheme in this imjwrtant respect. It must be borne in mind that in a manufacturing business the skill and judgment in the purchase of the raw material and the sale of the goods are important factors, and that when a largo amount of raw material is worked up, and when stocks both of raw material and of manu- factured goods are necessarily heavy, and when there is a constant fluctuation in prices, the apparent profits are much affected by these fluctuations. These matters are, of course, outside the workpeople, and they feel that their exertions may be in part neutralised by other causes not under their control, and this operates prejudicially on the working of this scheme. Could they clearly see cause and effect, and directly trace the residts of their increased watchfulness in the increased prosperity of the business, then their participation in the profits would probably have more definite results. " Fifthly. — There is no doubt that the management of the business by the partners is much more closely watchetl by the workpeople, and especially by the foremen and others in places of trust. " Having thus endeavoured to describe some of the results of the plan carried out in our works, I will attempt to point out some of the lessons that these appear to me to teach, and also to state some of the difficulties that seem to me to threaten all schemes the object of which is to make the employed participators in the profits with their employers. " Firi^t. — Unless a sufficiently large share of the profits be given, the desired effect will not be produced, that is to say, that increased attention and intelligence will not be aroused which are necessary tO' ensure its success. " Secondly. — Tlie larger the interest given to the employed, and the more their prosperity depends directly on the prosperity of the con- cern, the greater will their influence become. As long as a business is prosperous and well managed all will go well ; large profits will be divided, and the employees will be satisfied. But when bad times • Transactions of the Social Science Association, 1881, pp. 671-5. DETAILED ACCOUNT OP CERTAIN EXISTING SCHEMES. 65 oome, either from depression in the trade carried on, or from bad management, then difficulties will arise, the workpeople may becomc- dissatisfied, and, in the latter case especially, may insist on the management being changed. In any case the difficulties of the principals will be greatly increased, and they may come into awkward collision with their workpeople. " TJiirdly. — I fail to seo that tlie introduction of industrial partner- ships will altogether solve tke wages difficulty. Divide the profits as you will between capital and labour, it will always be a question open to dispute whether that division is a fair one. It is true that by introducing plans whereby labour is to share directly in the profits made by the joint action of capital and labour the total profits earned may be augmented, and the earnings of the labourer be also increased ; and yet after all he may remain dissatisfied with his share, and may demand eithei- an increase of wages or a larger share in the profits. *' In conclusion, it seems to me that the experifnce gained by the working out of the scheme adopted by us shows that when the basis exists of an excellent understanding, and thorough goodwill between the masters and workmen, and when the share of the profits given to the latter is not too large, then the system may be carried out successfully so long as the management of the concern is good and the business prosperous; but that the results on the profitable working of the business are somewhat dubious. It has, however, the advantage of avoiding to a large extent the difficulties which might arise were the share of profits divided among the workpeople to be on a larger scale." At the time of the 1912 Enquiry, Mr. Fox stated that he did not think that the experience of the intervening years had materially altered his views. In connection with the present enquiry, the secretary of the company expresses the opinion that the scheme has given satis- faction to the company and to the workpeople, and that it has promoted harmonious relations between them. On the other hand, there is no evidence that it has called forth extra zeal on the part of the employees, or that it has tended to lengthen the average period during which the workpeople remain in the firm's employment, and to prevent changes of staff. E. S. and A. Robinson, Ltd. [For an account of this firm's deposit account scheme, see pp. 104-5.] Richard Thomas and Company, Limited. This company are large manufacturers of tinplates and other articles of iron and steel, and have a number of works in South Wales, Monmouthshire, and Gloucestershire. They employ about 7,200 workpeople when all the works are in full operation. In June, 1913, they introduced a scheme of " Employees' Profit-sharing Deposits." Under the original scheme, the com- pany received sums on deposit at a fixed minimum rate of interest of 5 per cent, per annum, to which was added a bonus equal to the difference between this fixed rate and the average rate of dividend and interest paid on the shares, debentures, and borrowed capital of the company, with a maximum of 12 per cent, per annum. The rules were revised in September, 1918. and now provide for a. fixed minimum rate of 7| per cent., with a bonus 66 DETAILED REPORT. I'ljiKil to the (lint'iciitc I)rl\vc(Mi Ti per cent, and tlie rate of ilividriitl paid on tlu' company's ordinary shares, subject to a nmxinnun of 20 i^er cent. Enii)loyee.s may i)ay in such sums as they please, or they may arranji^o for a fixed sum to be deducted from their wages every wi'i'k and credited to their account. Interest and bonus may be drawn in cash, or credited to the onTiiloyee's deposit account, at the employee's option. Income tax at the current rate is deducted both from interest and from l)onus; but employees with incomes under £i;30 a year can, of course, i^ecover these deductions in the usual way. The maximum amount which may be deposited is five times the annual salary, in the case of employees paid monthly, and £500 in the case of employees paid weekly or fortniprhtly : these amounts are exclusive of accumulated interest and bonus. The directors reserve the right to vary these limits, and to place a limit on the aggi"egate amount which may be received on deposit from the employees collectively. From July, I9I3, to September, 1918, iu addition to interest at 5 per cent, per annum on the deposits, bonus was declared half-yearly varying from 08 per cent, to 7 per cent, per annum, the average rate of bonus being 535 per cent, per annum; so that, including interest, the depositors have received an average return of 1035 per cent, per annum on their investments. As regards the success of the scheme, the Company write: — " At present there are about 539 dejxisitors, with deposits " amounting to about £75,000: and, although the number of " depositors represents only alxjut 10 per cent, of the total '' employees of the company, we look upon the scheme as "being quite a success, having regard to the fact that " during the war we encouraged our employees as much as " possible to take up "\A'ar Savings Certificates and invest " in AVar Loan, &c., Avliich of course would take up their " surphis earnings." (2) Shareholding by Employees. A large number of schemes provide for the acquisition by employees, either gratuitously or on specially favourable terms, of shares in the capital of the businesses by which they are employed. Such shares may be either (i) ordinary or preference shares, such as are issued to the general public, or (ii) special shares limited to employees, which, as a rule, carry no voting riglits, or rights of voting only on special occasions (e.g., when tlie rights of employee-shareholders are in question), or at special meetings of employee-sliareholders. Four classes of shareholding schemes may be distinguished : — (i) Schemes based on the distribution of a profit- sharing Iwnus, part or the whole of which is retained for the acquisition of shares in the capital of the employing company. I DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 67 (ii) Scliemes in which the profit-sharing' bonus is itself given in the form of shares. (iii) The issue of shares to employees gratuitously. (iv) The issue of shares to employees on specially favour- able terms. It may be pointed out that the first two groups of schemes are on a different footing from the last two, representing as they do Profit-sharing in that developed form which some advocates of the system prefer to call " Labour Co-piirtnershij)." These are the schemes classified as " S " in the Table of Existing Schemes (Appendix A, pp. 150-165). Classes (iii) and (iv), on the other hand, do not begin with the distribution of a profit-shar- ing bonus, which is then capitalised, but proceed at once to the allotment of shares to employees, without any intermediate stage. The profit-sharing; bonus in these cases, therefore, con- sists, not in the shares distributed (the amount of which may not bear any relation to the amount of the profits), but in the dividends paid thereon (if the shares are issued gratuitously), or in such part of the dividends as represents the advantage given to emiiloyee-shareholders over the outside investing ])ublic (in cases where the shares are issued on favourable terms, but not actually free of charge). AVhere, as is almost invariably the case, these dividends are paid in cash, schemes of this type are classified as '' C " in the Table of Existing Schemes. Bradford Dyers' Association, Ltd. This company, which employed in 1918 nearly 10,000 persons, voted a sum of £5,000 at the annual general meeting on February 28th, 1912, to be distributed as a bonus on ordinary shares held by employees, so long* as they remained in the company's employ- ment. No bonus was to be paid if the dividend on ordinary shai'es fell below 5 per cent. ; but, if the dividend was at or above that rate, the bonus was at the rate of 5 per cent, on holdings not exceeding* one thousand £1 shares. (The rate on holdings exceeding one thousand shares was lower.) No indivi- dual employee was entitled to register, for the receipt of this bonus, except with the consent of the managers of the fund, shares in excess of the amount of his remuneration for the preceding two years. Supposing, for example, his wages were 25s. a week, i.ei, £130 for two years, he could register 130 shares. Facilities were provided for employees to acquire shares up to double the number they could immediately pay for : the arrangement is fully described below. The bonus was at first dependent on grants voted year by year by the shareholders at the annual general meeting ; but in February, 1918, the scheme was put on a permanent footing, and the basis was slightly altered. The bonus is now an amount fluctuating with the rate of dividend on ihe ordinary shares. If the dividend is under 5' per cent, employee-shareholders get no bonus, but if it is over that rate they receive a bonus at r,S liKTAILKD UEPOllT. half ilii^ ralf t'l' dividiMul (iucludiug boniis-clividends). For fxaiiipli', ill it'sjx'ct <)]■ tiio last financial year, when the divi- dend (in(ludin<;- honus-dividendj on the ordinary shares was I7A pel' ctMil.. (MMployoe-sliarelioldors received a total of 26 per ccnl. nus of 8^ per cent, in adtlilion lo I he regular dividend paid lo the shareholders g-enerally. Shart's oil the previously existing " Employees' Benefit Fund Hegisti-r " were to 1h' transferred to the new Register ; but in fill lire the niaxinnuii initial amount that any employee was entitled to have registered for the receipt of bonus was to l>e such number as would be equal (at par value) to three-quarters of his average annual remuneration during the three previous years. Any addition to his registered shares in any subsequent year was not to exceed one-fourth of his remuneration in that year; and the maximum amount he might have on the register at any given date was not to exceed the total of his remunera- tion for the previous five years. The total number of shares that may be legistered by all the employees collectively must not, under the rules as they stand at present, exceed 400,000. Employees receiving £250 a year or less may register either preference or ordinary shares; other employees only ordinaiy shares. The reason for this special facility for the lower-paid men is explained to be that " many careful and thrifty workmen " are very chary of placing their savings, which may have taken "years to accumulate, in shares where there appears to be con- " siderable risk of fluctuation in the value." All employees of three yeai's' service or over are eligible to register shares. The term " employee " is defined as including any person in the sole employment of the comjiany, other than the chairman, the managing director, and members of the execu- tive committee of directors at the date of the resolution. The shares, both ordinary and preference, are of £1 nominal value ; but they con only be entered on the bonus register in nniltiples of 10. All right to the bonus ceases (i) from tlie date of sale of any shares by an employee who remains in the company's service, or (ii) from tlie date of termination of employment, by death or othei-wise. This, however, is subject to the proviso that, up to a number not exceeding 10 per cent, of the total authorised maximum, shares registered by an employee who retires on or after attaining the age of 65. or from infirmity at an earlier age, may be allowed to remain on the register during the life of the eTuployee or for any less period. The arrangement under which employees could acquire shares up to double the number they could immediately pay for has been continued. The arrangement is thus explained by the Association : — Under the original scheme the sum voted by the shareholders was handed over to Managers, who dealt with it outside the -Association, since coniponies are not allowed to lend money on their own shares. The Managers advanced personally to any employee who requested it a sum sufficient to enable him to DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 69 purchase additional shares equal to the number he could pa^ for. For example, if he could pay for 10 shares he was allowed to buy 20, and deposit the whole 20 with the Managers of the Fund, who advanced the purchase price of 10. The employee could pay off his debt by simply allowing the dividends and' bonus (less 5 per cent, interest on the money borrowed) to accumulate, or he could expedite the repayment by adding as much as he pleased out of his own savings. To facilitate this the Association established a Savings Fund, in which employees could deposit sums of not less than 1^., receiving interest at 5 per cent, on each complete £1. The Chairman and' the Managing Director of the Company, who are the Managers of the Fund, have decided to continue this arrangement — still, of course, as a personal arrangement, apart from the Association. At the annual general meeting of shareholders in February, 1918, a sum of £100,000 was voted: — (i) for the acquisition of shares for presentation to em- ployees who were then serving, or who had served, in H.M. Forces. (These are preference shares; they are entered on the Employees' Bonus Register, and draw the profit-sharing bonu-s. They cannot be sold without the consent of the Trustees of the " Bradford Dyers' Association Fighting Forces Fund," until five years after the 1st March, 1918.) (ii) for grants to such employees who were wholly or par- tially incapacitated, and (iii) for grants to the widows and other dependants of former employees who had died on service in H.M. Forces. It should be noted that the shares thus presented were all bought in the ordinary way, at the full market price, and that it was provided that no part of the sum granted was to be invested in any new capital which might be issued. Similarly, all the shares registered by employees for the receipt of bonus have to be bought in the ordinary way, at the market value. No fewer than 3,600 employees hold shares in the company, to the total nominal value of £295,870, or 557 per cent, of the total paid-up capital. The particulars are given below: — No. of Nominal Employee Value of Share- Shares holders. Held. Soldiers sei'vingjOr who have served, in H.M. Forces, to whom Preference Shares have been allocated gratuitous 2.820 135,000 Other employees of the Association : — Holding Ordinary Shares 560 145,260 Preference ,, 207 12,950 Retired employees holding Ordinary Shares 13 2,660 None of the retired employees hold Preference Shaies. 70 DKTAILKD IIKPORT. 'lliu roiupaiiy luive no S4'i):iiat company, or their wives. It had over 1,5UU members witliiii a year of its starting-, and now has 2,400 members, iiu'ludiiig wives. The members pay in a small sum weekly, and certain l)enetits are paid in the event of the death of a member, the balance remaining' at the end of the year being distributed among the members. The directors, in introducing the profit-sharing scheme, ex- pressed the hope that employees would use the money thus distributed in piirchasing shares; but employees are not, of course, restricted to this sum, and may purchase shares with their other savings. There is no restriction as to the age or length of service of employees before they can participate. The number of present employees who held shares issued under the scheme on the 1st March, 1919,, was 439; and the nominal value of their holdings £20i,234. In October, 1918, an issue of ordinary shares was made to ordinary and employee share- holders in the proportion of three shares for every four held, at 30s. per share. In April, 1919, reserve funds representing accretions to capital were capitalised, and bonus ordinary shares were issued, at the rate of two bonus shares for every five ordinary or employee shares held. Both these operations represented considerable benefits to the employee shareholders, in common with the ordinary shareholders. No issue of em- ployees' shares has been made for the years 1917 and 1918, owing to permission not being granted by the Treasury ; other- wise it is possible that the number of shareholding employees would have further increased. Foster, Sons and Company, Limited. As an example of special arrangements made with the object of enabling the employees of a profit-sharing firm to acquire by the investment of their bonus not only a financial interest in a business, but also a considerable share in the control of the undei^ taking, may be cited the case of Foster, Sons and Company, Limited, of Burnley and Padiham, a firm of decorators and furnishers, plasterers, slaters, &c., employing, in 1918, 43' [jersons. This business was originally a private firm (William Foster & Sous), and in that form had already introduced a system of Profit- sliaring in January, 1900. Under this scheme capital was to receive, in the first place, a fixed rate of interest; while the. remaining net profits were to be divided in stated proportions' between the firm and its employees, the share of the employees being divisible among tliem in cash, in proportion to wages earned. In 1903 the business was turned into a joint-stock company, »viiile at the same time an association was formed of the employee^ of ithe new cximpany with the special object of enabling them to DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 73 acquire an interest in its capital and a isliare in the control of its affairs. The title of this society, registered under the Industrial and Provident Societies Act in April, 1903, is " Fosters' Em- ployees, Limited"; and it is stated that most of the employees of Foster, Sons & Co., Limited, joined the society on its forma- tion. By the articles of association of the company its directors are required to retain 1,000 of its (£1) shares for issue to the Employees' Society. The disposable profits of the company, after providing for the creation and maintenance of a reserve fund, are to be divided in the following manner: — The shares are, in the first place, to receive a dividend for each year at the rate of 5 per cent, per annum,* and the remaining profits are to be divided as follows: — One-tenth is to go to the Employees' Society, for its common fund (see helow)^ and four-tenths to the Employees' Society to be applied for the purchase of shares in the company and for the benefit of the employees : as to this four-tenths the company is to declare how much is paid as a bonus on the wages or salaiy of each employee who is a member of the Employees' Society, and how much is paid as a bonus on the wages or salaries of the non-members of that society collec- tively, such amounts to be strictly in proportion to the respective wages and salarie-s paid. Finally, one-fourtli is to go to the manager or managers for the time being; and tlie remaining one-fourth is to be paid to the holders of tlie ordinary shares as a further dividend. So far as concerns the share to be taken by the employees in the management of the affairs of the company, it is provided in the first place tliat the Employees' Society shall be entitled to appoint one delegate for every hundred shares held by it, to attend the general meetings, and to speak thereat, but one only of such delegates shall be its proxy to vote thereat; and, in the next place, that the employees shall be represented on the Board of Directors in the following manner : — ■ The number of Directors is to be not less than three nor more than five, and the first Directors are to be Mr. Thomas Foster and Mr. John Foster (the partners in the former firm of William Foster & Sons), and a third person appointed by them. So long as Messrs. Thomas and John Foster shall together hold one-half oi the share capital of the company for the time being issued and are willing to serve, they shall continue to be directors. The Employees' Society shall be entitled to appoint one of its members (whether himself a shareholder in the company or not) a director of the company whenever it holds at least one-tenth of the share capital of the company for the time being issued, and one more when it holds one-fifth. In the last case the total number of directors shall be five. Subject to the provisions last stated, the directors may appoint additional directors, but so that the total number of directors shall not exceed the maximum above specified. * Provision is made for the making up of anj deficiency on the dividend for the preceding year. 74 DiyPAILKD REPORT. Tho special <)l)jecls oi tlu' Kniijloyecs' Society are declared by iUs rules* to he to denl in the shares and debentures of Foster. Sons and Company, Jjiniited. Su!)ject to the provisions stated! Ik'Iow as to tlio couiinon fund, all sums rereived by the Society uutler arran{4eiuents of tiiat company for sharing profits with its employees are to be treated as ca])ital and invested iu the manner stated below and ereditcd in the books of the Society as follows : — (1) Each member of the Society is to be credited with the amount declared by the company to be paid as bonus on his wages or salary, and, whenever there is a suffi- cient sum standing to his credit, enough shall be transferred to his share account to create a fully paid-up share in the Society. (2) The bonus on wages of non-members of the Society is to be credited collectively to a non-members' provident fund, to be administered a,s a tnist for the benefit of those employees of the company who are not members of the Society, or their wives, children, or widows, or persons dependent on them. (3) The sums declared by the company to be paid Por the credit of the common fund are to be applied for educa- tional, social, provident, pix)pagandist and other pur- ])oses for the benefits of the members of the Society or their wives, children, widows, or persons dependent on them. The capital of the Society is to' be invested in fully paid-up shares in the company, so long as such shares can be acquired, by allotment, at par. Thereafter the committee of the Society are, if autliorised by a general meeting, to invest any further capital in the purcliase at the market price of additional shares or debentuies in the company. If any balance-sheet of the Society Avould othei'w'ise slnnv a deficit in capital account, the amount of such defict shall be written off the reserve fund, and failing that off the common fund. The j)rofit and lovSs of the Society is to be calculated annually, and at the same time its investments are to be valued by the committee. Any deficiency in the value so set upon these invest- ments as comi)ared M-ith their normal value is to be treated as a loss by the Society for that year, and any surplus above such nominal value is to be put to resein-e fund until such fund equals one-fourth of the nominal value of the Society's investments for the time being; and any further surplus is to be treated as profit for the year. Out of the pix)fits of the Society share capital shall in the first place receive interest at the rate of 5 per cent, per annum, whenever the profits suffice to pay such dividend, after extin- guishing any adverse balance and providing for reduction of • The Rules of the Employees' Society consist of "General Rules for an Industrial and Provident Productive Society," published by the Labour Co- partnership Association (6. Bloomsbury Square, London, W.C.), modified iu the " Special Rules " of this Society DETAILBD ACCOUNT OF CERTAIN EXISTING SCHEMES. 75 prelimiuaiy expenses and payin<>' any subscriptions due to co- operative propag'andist associations. Any surplus profit is to be applied as follows : — " (1) In paying tlie employees of the Society a dividend upon the wages or salaries received from the Society during the year at the same rate as the dividend on wages declared by the company for the period in question. " (2) If any surplus still remains, in forming a reserve fund, until such fund shall equal 25 i^er cent, of the nominal value of the Society's investments for the time being, Such fund shall be applicable by resolution of any general meeting on a recommendation of the com- mittee to meet any contingency affecting the Society or for any other purpose, whether within the objects of the Society or not, other than, the payment of interest on shares, provided that notice of everj^ such recommendation be given to every member not less than six clear days before such meeting. '' (3) If any surplus still remains, in paying any arrears of interest on shares which in any previous year have not received 5 per cent., the oldest of such arrears to be paid first. " (4) If any surplus still remains, in paying the committee for their services according to any scale from time to time appiMDved by the general meetings; and " (5) If any surplus still remains, in paying in cash a further dividend on .shares for the year." Out of the total subscribed capital of the company (3,-479 shares of £1 each) 749 shares are owned by the Employees' Society. These shares entitle the Society to oiie-fifth of all the ^'otes that can be given at a general meeting of shareholders of that company; and out of the five directors of the company two are employees, appointed by the Employees' Society. Mr,. Thos. Foster, in reporting upon the scheme in connectioi with the present enquii-y, states that the building trade in Burnley and district was very bad for some years before the war, and no bonus was paid. During the war it was deemed desirable to retain all surpluses over the 5 per cent, dividend to guard against contingencies, owing to the extremely uncertain position. The number of the comj^any's employees who belong to '* Fosters' Employees, Limited," fell to 18 in 1918, partly owing to the large number of employees who had left on account of the war, and partly owing to a general loss of interest in the scheme. The management and the Emi)loyees' Society are, however, taking steps to increase the membership of the Society, so as to include all who are regarded as permanent employees; and the response, Mr. Foster says, is gratifying. He adds that, though the scheme has not hitherto had quite so much effect as was hoped, the company still believe the scheme to be excellent, and expect that, before the end of the current year (1919), it will have the enthusiastic co-operation of most employees. 70 ItK'IAII.ED REPORT. //ii:i II. \\(ifso/i and Viney, Lhnited. In .M;iy, ISSli, Messrs. lliizcll, Watsou uucl Viney, Limited, luiiilei-s aiul lKK)kl)imleis, oi London and Aylesbury, a firm now (•nij)loying between 1,400 and 1,450 per'^ons,* brought fonvard a scheme of Profit-sluiring under which they projiosed to allot by way of Iwnus to all persons who had been employed by lluMu for more than three years, one-halt of any pi-ofits that mi<;ht be made over 10 per cent. One-half of the bonus was to bo paid in cash in proportion to wages earned, the other half being added to a provident fund, to which the employees pay weekly contributions, which have been supplemented by large donations from the company. This fund provides sums jiayable at death, and g-rants during exceptional illness or calamity, and a limited number (at jjresent 26) of pensions of 10.«r. a week to members over 60 years of age. The interest of an employee in the provident fund cannot be assigned or taken by creditors. Provision is made for enabling an employee who leaves the firm to receive two-thirds of his subscriptions to this fund without interest. The amounts which accrued to the employees under this profit-sharing scheme, taking the bonus paid in the years 1887-93 inclusive, were equivalent to an average addition to the wages of participants of 08 per cent. In 1890 the firm made an arrangement by which employees were allowed to buy £10 shares in the company at about three- quarters of their market value, by weekly instalments of Is. each. The employee at once received the full dividend, and if he died before all the instalments were paid, his representa- tive took the shares without further charge as fully paid-up. The profit-sharing scheme (apart from the arrangement for the purchase of shares by employees) was discontinued in 1895, on the ground, as stated by the comjtauy, that the profits had not for some time allowed the payment of bonus. But the share-purchase arrangements have been continued, under terms varying from time to time, but, speaking generally, of a similar character to those above described ; and in all cases the shares have been allotted to the employees at about three-fourthg of their market value. Under these share-purchase schemes it is provided that, "in order to ensure that the shares shall be " held by those employed in the business," the following restrictions shall be imposed as to the re-sale of them: — " (9) Ska re holders leavinr; the company when under 50 years of ape. — Any shareholder who leaves the company from any cause whatever before reaching the age of 50 shall l>e bound to offer his (or her) shares for re-sale at the price paid for them (i.e., £10 each) to some other employee of the company. If any descendant of the shareholder so leaving shall be in the employment of the com]iany the shares may be transferred to him. If the shareholder has 7io descendant in the employ of the com- pany, then he shall give the directors notice of his * Including those serving with the Colours. DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. li intention to sell his sKares. It sliall be the duty of the directois to find an employee or somo other person to purchase the shares at £10 each. If the directors fail to find a purchaser in one month from the date of such notice, then the shareholdei' shall be at liberty to retain his shares or to sell them in the open market at the best price obtainable. " The same conditions shall apply to any shareholder who xcishes to sell these shares while remaimng in the company' s employment. " (10) Shareholders leaving the company when over DiO years of age. — Shareholders who have attained the age of 50 before leaving the company's employment shall have the privilege of retaining possession of their shares for life, and after their death clause 12 shall apply. " (11) Shareholders dying before all instalments are paid. — ^If the purchaser dies after he has paid his first instalment, and before his purchase is completed, all further liability as to instalments on his shares shall cease, and the shares become the property of his heirs, to be dealt with in exactly the same way as shares of shareholders dying, after paying all their instalments, and in the same manner as described in the next para- graph . " (12) Sh-arehalders dying after paying all their instal- ments. — Upon the shareholder's death, at any age, the shares may be held by his widow, if she sO' desire, during her lifetime. At her death the shares must be trans- ferred, as described in paragraph 9." Not more than five shares are to be allotted to any one employee on the special terms described above, and in allotting such shares " preference will be given to those who have been "longest in the company's employ, and to any who may have " bought shares at a higher price " (than £10 each). The total nominal value of the shares now held by 345 of the company's employees is £17,200. These shares, it should be underetood, entitle the holders to the ordinary voting rights; and the proportion borne by the votes of these employees to the total of all the votes that could be given at a general meeting is approximately 6 per cent. The company's employees are allowed to deposit their savings with the firm at 4 per cent, per annum (free of income tax), these deposits being Siecured by £17,200 5 per cent, first mortgage debentures of the company, the market value of which is par, and by other Stock Exchange investments whose present value is £5,171. The present number of depositors is 1.272. and the total amount on deposit £21.010. The provident fund (referred to above) possessed at Tune 30th. 1918, a capital of £18,164. and had a membership of 691. This fund is invested mainly outside the company; but there are held on its account 237 ^£10 5 per cent, cumulative preference shares of the company, 14 of the company's 5 per cent, movi- gage debentures, and 33 of its ordinary shares, besides £1.300 ?5s DETAILED REPORT. on ile]i().sit with the coiiii)any. Any memljer of the provident tiiiid wlio is iiiaking- iui ett'ort to save, and who sees that a loan of a nio(hM-ate aniouut will helj) him in this direction, is elijrihh' for a loan from the company, to be repaid by instal- ments spToa^l over several years, with interest at 4 j>er cent. ]M'r annum. Ix>ans are granted ujxjn condition that they are used for some puriK)s;e of thrift, such as buying- a house, buying shares in the company, or in some way increasing the applicant's «-;ii»it;il. To qualify for a loan, Iwrrowers must be able to produce evidence of having already made some savings, and ihey must be able to gTve reasonable security, which, however, involves the l)orrower in no legal costs. By adding to the loan a >siira equal to the insurance risk the borrower is able to secure that, in the event of hi.s death while the loan is rnnning, his representatives have nothing to pay, and the house, or what- ever i)ro])erty the loan has purchased, becomes his free of further charge. Eighty-five loans have been made, amounting to £18,100, of which £15,200 has been repaid. The borrower can rei)ay at any time ; but the company cannot call in the loan before the termination of the agreed period, even if the borrower leaves the company's service. In addition to the provident fund there is also a pension fund, which was establislied in 1910 with the view of enabling members of the office and administrative staff with earnings of at least 40,?. a week (25,$. in the case of women) to make substantial savings on their own account. The money paid in by the members, who were 64 in number at December 31st, 1018. accumulates at 4 per cent, compound interest; and each year the company pa3^s into the fund a sum sufficient to pro- vide a 50 per cent, bonus on the members' savings. Of the £8.T25 to the credit of this fund on December 31st, 1918, the greater part was invested outside the firm's business. The company contribute a large sum annually in various other ways for the advantage of the whole staff. These contribu- tions amount to over £5,000 annually. With respe^'t to the results obtained by the arrangements above described, the company state: — "We continue to find " beneficiail results from the workers' investments, and it is "our intention on a future occasion to increase the amount of " workers' shares, which will be available at less than the " market price." Lever Brothers, Limited. Ijord Leverhulme, the chairman of thi.s well-known soap manufacturing company, introduced a co-partnership .scheme in 1909. It has since been amended several times, and the account liere given is based on the scheme as it stood in August, 1919.* The company's articles of association provide that, after pay- ment of preference dividends and a dividend of 5 per cent, upon the ordinary shares fall of which are held by Lord Leverhulme or by members of his family), any further sums proposed to be ilistributed by way of dividend are to be applied in the payment, • At the time of going to press with this Report (January, 1920), certain changes in the scheme were under consideration. DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 79 to the trustees of the " Co-partnership Trust," of a dividend at the rate of 5 per cent, per annum upon the " preferential certificates ' ' of the Trust : the surplus profits are then divided between the holders of ordinary shares of the company and the trustees of the " Co-partnership Trust " in proportion to the total amount paid-up for the time being on the issued ordinary shares of the company and the total nominal amount of (a) " partner- ship certificates " then issued and outstanding, and (6) 5 per cent, cumulative preferred ordimiry shares for the time being standing in the names of the holders of the partnership cei'tifi- cates. The certificates (partnership and preferential) are for £1 or a multiple of £1, and are to be issued from time to time as required by the scheme ; but in no case are partnership certificates for a nominal amount exceeding £1,000,000 to be at any one time issued and outstanding, except with the consent in writing of "the holder of the majority shares of the company," i.e., the registered holder or holders of all the issued ordinary shares of the company, or such holder of ordinary shares as shall be nominated in writing by the holder or holders of at least three-fourths of the then issued ordinary shar-es, to exercise the powers conferred upon " the holder of the majority shares of the company." Such holder shall at any time or times be at liberty to require that any further issue of par-tnership certifi- cates shall be stopped, either permanently or for such period or periods as he shall think fit. The trustees are to be the directors, for the time being, of the company (other than Lord Leverhulme or* the Hoir. W. Hulme Lever) or such of them as are willing to act. It is expressely declared that the trust deed shall not be construed as creating a partnershiji in law between the conrpany and any person interested under the scheme. The conditions upon which partnership arrd preferential certi- ficates may be issued are stated irr the scheme in the followirrg terms : — " 2. Every director of any length of service and /or age, "and every employee who shall be not less than 22 years " of age, be of good character, and shall have a clear record " of at least four years' faithful and loyal service with the " company, or any of the associated companies, or the chair- " man of the company's directors, or the Hon. W. Hulme " Lever, and who shall agree to be bound by the provisions "of the trust deed and the scheme, and also undertakes not " to waste time, labour, materials, or money in the discharge " of his duties to the company, but to loyally and faithfully " further the interests of the company, its associated com- " panics, and his co-partners, to the best of his skill and " ability, may, subject to such provisions, have issued to " him from time to time partnership certificates upon the " terms hereinafter mentioned. Provided that the holder of " the majority shares of the company shall, if he so think " fit, be entitled to cause certificates to be issuee final and bincl- " ing "6. The trustees shall from time to time issue to every ])erson qualified to receive the same, partnership certifi- " cates in accordance with the foregoing provisions. • For constitution and f unctionR of this Committee, see below, pp. 83-4. DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 81 Clauses 7-9 lay down the limits of the nominal amount of ** partnership certificates " which a director or employee may receive, according to his rank and salary. Clause 10 lays down the conditions urwler which " partner- ship certificates" may be cancelled, as follows: — " 10. The partnership certificates held by any director " or employee shall be cancelled : — " (i) In the case of a director, if he shall in the " opinion of the holder of the majority shares of the *' company, or in the case of an employee, if he shall " in the opinion of the trustees, be guilty of neglect " of duty, dishonesty, intemperance, immorality, wilful " mi'sooinducti, flagrant inefficiency, disloyalty to his " employers, or breach of his undertaking not to waste " time, labour, materials, or money in the discharge " of his duties, but to loyally and faithfidly further " the interests of the company and its associated com- " panics to the best of his skill and ability, and whether " or not he shall resign or be discharged from his em- " ployment in consequefnoe thereof Any " employee whom the trustees shall consider guilty, " or the widow of such employee, shall be entitled to " have his case considered by the committee before '' being finally dealt with by the trustees, and any sucli '■' employee or widow may appeal from the decision ot ■' the trustees to the holder of the majority shares of " the company, whose decision shall be final and binding. " The procedure specified in clause 5 hereof, as to the " reference to the committee, the decision of the trustees, " and the appeal therefrom, shall, so far as applicable, " be followed in any proceeding under this sub-clause. " (ii) If the employment of a director or employee " shall cease, if a man before he attains the age of 65 " years, or if a woman before she attains the age of " 60 years, by voluntary retirement or resignation and " not owing to permanent incapacity to work caused by " ill-health. " (iii) If the director or employee, being a man, shall " attain the age of 65' years, or being a woman shall " attain the age of 60 years, and shall retire, whether " upon his or her own initiative or upon* the reque>st " of the company or an associated company. " (iv) If the director or employee shall die or shall " from any other cause, save those hereinbefore speci- " fied in this clause, cease to be a director or employee. " (v) If during the life of the drrector or employee " any act or event shall happen whereby the partnership " certificates held by him under the scheme, if belong- " ing absolutely to him, would become vested in or '' charged in favour of some otJier person or corpora- " tion. 82 nKTAlM']!) UEPOKT. TJie " prefereutial certificates " referred to above are issued oil tilt' convorsioii of pai-tiiership certificHites, as will be seen from Clausti 11, quoted below. It is explained, however, that the jfraiiliiiport of institutions which serve the needs of the Company's employees, such as churches, schools, clubs, or parks, or for the granting of scholarships to employees' children. Clause 12 deals with the cancellation of " preferential ceitificates," as follows: — " 12. A Preferential Certificate, or the right to a Pre- " ferential Certificate, shall cease and be cancelled: — " (i) if the holder thereof shall die; " (ii) if the holder thereof, being a former director " or employee, shall enter into any employment or " business without the previous consent in writing of " the trustees ; " (iii) if the holder thereof, being the widow of a director or employe©, shall marry again; (iv) if any act or event shall hai)peu whereby the " Preferential Certificate, if belonging absolutely to the " per.son to whom it is issued, would become vested in " or charged in favour of some other person or a oor- " poration ; DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 83 " (v) if the holder thereoi' shall, in the opinion of the holder of the majority shares of the company, be " guilty of dishonesty, intemperance, immorality, or *' misconduct. The words ' the holder th.ereof ' where contained " in this clause shall mean and include the holder of a Preferential Certificate or any jjerson claiming" the " right to a Preferential Certificate, as the case may " be." In July, 1909, 1,041 employees of Lever Brothers, Limited, including directors, managers, salesmen, travellers, advertising managers, clerks, workmen, labourers and othei's, who had quali- fied under the terms of this scheme, were handed Certificates (Partnership and Preferential) of the nominal capital value of £113, G50'. The scheme was made retrospective, so that any employee who was 25' years of age in 1901 and had five years' sem'ice or more at that date was eligible to receive certificates for eight years ; and, of the total number of certificates then issued, 30i3 were retrospective for eight years or over, and 738 retrospective for periods varying from one to seven years (average, 3" 7 years). The dividends on the partnership cetrtificates were originally credited to the persons entitled to receive them in a savings bank account; they are now paid in the form of 5 per cent, cumula- tive preferred ordinary shares, which the holder can sell at any time for cash at par value, if he so desires ; but, so long as the shares are held by the co-partner to whom they were originally allotted, they also participate further in profits, to the extent that they yield to him the same rate of interest as that enjoyed by the ordinary shareholder. Committee. — In connection with the working of the scheme there is established a committee consisting of three persons nominated by the persons constituting the management class, three nominated by the persons constituting the salesman class, three nominated by the persons constituting the staff class, and three nominated by the holders (if any) of the preferential certificates for the time being outstanding. No person not ordinarily resident in the United Kingdom is eligible for election as a member of the committee. No resolution of the committee is to be deemed to have been carried unless supported not only by a majority of the members- of the committee, voting individually upon the resolution, but also by a majority of the different sections of the committee represented and voting at the meeting; and for this purpose each section of three members is to be deemed to be entitled to one vote, which shall be given in accordance with the direction oi a» majority of the members of that section present at the meeting : and, unless there is such a majority, the vote of that section is not to be counted. . The committee elects a chairman, and such chairman, it the voting of the members of the committee be een- sioners ; (iii) to the relief of the necessitous mother of any deceased certificate holder who was formerly supported by sucli holder ; • The Trust Deed establishing this Trust is a document of eight krge pages, containing 26 articles and two schedules ; one of the schedules contains 23 clauses. There is also a supplementary Trust Deed, dated 15th June, 191 H, of three large pages. This indicates the great elaboration of some of the modern schemes, and the care taken to give them legal form. Similarly, the new shareholding scheme of Spillers Milling and Associated Industries, Ltd., is also contained in a Trust Deed, which is nearly as detailed as Messrs. Wilkin's. 24335 T> 90 DETAILED REPORT. (iv) to the relief of any necessitous employee or former omjiloyee of the company; (v) in payn'ient of subscriptions to hospitals, convalescent homos, &c. ; (vi) in any oilier manner approved by the directors of the company. The sum of £1,743 was paid under the Trust Deed in respect of the year ended the 31st December, 191G, and the sum of £2,423 in respect of 1917. The number of holders of pension certificates is rather over lOO. The company also receive sums on deposit from employees, on which 5 per cent, interest is allowed. The total amount so 2 «)2 DKTAILKl) RKPORT. I'roin lilt' clt'iii- pKilit (i! the year, i.e., " tlie net aniuimt " a\ailal)l»' h)v divideiul reserve or carrying- forward, after " tlodiictidii of all oiit^'-oings whatsoeTer," there is deducted a Niiiii Niilficifiil to ]>;iy 5 per cent, on the preferred shares aaid II ])(M- cent, on the ordinary sharesv One-fifth of the remainder forms " the gratnity fund." (The proportion set aside for the gratuity fund was originall}' one-tenth, and has been raised to its ])resoiit level by successive revisions.) The amount of the gratuity fund is certified l)y or on behalf of the official auditor or auditors of the company, whose certificate must be accepted by all concerned as absolutely conclusive. To be admittt'd to participate an em])loyee must be twenty-one years of age on tlie day of distribution, must have been con- tinuously in the emi)loyment of the company for eighteen months immediately i)roceding that da}', and be then still in the com- pany's service. If an employee leaves the company's service, and is afterwards taken on again, he or she has to sei'A^e a fresh term of eighteen months before he or she again becomes eligible to participate. He or she must also not have been absent during the company's financial year, ending 81st October, (i) in Hull, where the '' one-break "' system has been adopted, more than 120 hours, and (ii) in London more than 60 quarters or 215 hours in the aggregate, unless with the sanction in writing of a manag- ing director. In case of sickness or other unavoidable cause, the managing directors may, however, grant an approximately proportionate amount of any gratuity to which the employee Mould otherwise have been entitled. On the other hand, the managing directors may withhold the whole or any part of a gratuity, for any reason which in their opinion is sufficient, the amount so with- held going to augment the other gratuities. The number of em})loyees in constant employment who received a gratuity under the scheme in 1918 was 444 : this number included practically all the men and 27 per cent, of the women. In respect of the years ended 31st October, 1915 and 1916, men (or women) serving in HM. Forces, or otherwise absent on war service, received half of any gratuity to which they would have been entitled had they remained in the service of the c<)mi)any, and the other half was set aside as a general fund for the relief of the employees or ex-employees of the company who rendered naval, military, or other war service, and their dependents. For the years ended 31st October. 191T and 1918, men ('or womeiO absent on war sei'vice received h;ilf of any gratuity which they would liave received had they remained in the seiwice of the company, and the total available amount was distril)uted on this liasis. it being considered that the creflit balance of the general rel)»^f fund was amjjle for the purpose for which it was required. The gratuities are jKiid in cash. The amount of the gratuity to be Dnid to each individual is decided by an elaborate scale. Participants are placed in one of fifteen classes, who receive respectively half a gratuity, one whole gratuity, one-and-a-half gratuities, and so on up to twelve gratuities. A " gratuity," DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 93 i.e., tlie unit of i)artiL'ii)ati()ii for Ihe purposes of this table, is that fraction of the entire <>ratuity fund obtained by dividinj^' it by the total number of gratuities which haA'e to be provided, in accordance with the scale. The total number of g'ratuities, or units of participation, which had to be taken into account for the purposes of ihe distribution in 1918, for example, was 800, giving- an average of 1^ " gratuities '' to each participant. Sixty-four employees have invested i'l the company. They hold 5,825 fully paid ordinary shares ajid 600 fully paid pre- ferred shares : both classes of shares are of £1 nominal value. The objects of the company in introducing the scheme are .stated to have been " to give as many as practicable a personal " interest in the economical administration of tlie business of *' the company." The notice goes on to say that " as it will be " to the direct i:)ecuniary advantage of all participators that " there be no waste of time, labour, or material, it is confidently " expected that they will throw into their ^Aork an amount of " zeal and energy that will effect economies othei wise unattain- '•able." The company rej)ort that the scheme has given satisfaction bolh to themselves and to their employees; that it has called forth extra zeal on the j)art of the latter, and promoted harmo- nious relations between the company and those in their employ- ment. British Cijajiides Company , Limited. This scheme is of interest both on account of the care that was taken to make the proposals known io and accepted by the employees, before their introduction, of the manner in which the bonus is paid, and of the central position that is given in the working of the scheme to the employees' Consultative Committee. The scheme was adopted by the directors on the .1st November, 1916, and thereafter approved by the principal shareholders. It was then submitted to a general meeting of employees and explained by the Chairman of the company on the 8rd Januaiw, 1917; The employees approved the proposals in general, and appointed a provisional committee to work out the details of the scheme, especially as regards the Consultative Committee. The pr^)visional committee held three meetings, and presented a report containing recommendations for the constitution and functions of the Consultative Committee. These recommenda- tions were approved by the Board of Directors, and circulated among the employees. They were then submitted by the chair- man of the provisional committee to a general meeting of the employees, over which the Chairman of the company pi-esided. on the 2nd April, 1917, and adopted; and the scheme came into force on the 1st May, 1917. The rules of the profit-sharing scheme and the regulations of the Consultative Committee are printed in full in Appendix E (pp. 192-4). It will be noticed that the bonus fund consists of a sum equal to 2| per cent, on the total of wages and salaries for every 1 per cent, (free of income tax) by which the share- holders' dividend exceeds 6 per cejit. (also free of tax). "When •34335 D ;^ m l)KTAII-i:i» UKroKT. tlio sli;iivli<>lil('i>' (lividfiid, {hcrefore, is at 10 per cent., the omployees' Imjiius is at the same level. Above this level, the eini)I<)yeos' bonus is ;il tlie i-ate of 1 per cent, on wages and .s;ilarit's tor cvoiy 1 imt rtiil. (free of tax) distributed as divi- (liMid. Houuscs to individual (•iii|il(iye('s are paid in cash. They are not paid ill a lump suui, but at weekly oi' other intervals during- the year sutceeding that in \\hi(di the profits were made. The weekly payments are based updii reg-ular attendance; the pay- ments at huiger intervals are intended as a reward for efficient work. Anotlier portion of the bonus fund is credited to a fund for the benefit of the employees ((dlectively. Temporary em- jdoyees (including- the women and g-irls employed) do not participate in any part of the bonus. On the other hand, emjjloyees on seiwice witli PI. 51. Forces received the same benefits us those remaining- in the works. It is to the Consultative Committee, however, that the com- pany attach the most importance, li^pon this point they write : — " In our opinion, after nearly two years' experience, by " far the most important feature connected with the scheme " is the ai)pointment of the Consultative Committee. " We have found this committee of the greatest use in " handling the innumerable questions which arise in con- " nection with the operation of a factory and the welfare of "the operatives; and the tendency of the Board [of '' Directors] is continually to exx)and the functions of this " committee and lay upon them a wider scope of responsi- " bility. It is our personal belief, which is shared by the " higher officials on our staff at the factory, that the " functions of this committee will continue to expand until " practically every question which concerns the operatives '' and therefore the management and operation of the '* factory, except probably individual wages and salaries, " may in case of nece.ssity be referred to this committee for " settlement, subject, of course, to confirmation by the " Board. On this point, it may be of interest to record " that on no single occasion up to the present has the Board " found it necessary or advisable to withhold its consent to " any recommendation put forward l)y the committee. " We have also found that the closer intercourse which is " brought about through this committee between the board, " the staff, and the workmen has been all for good, not " only in bringing before the directors the point of view of " the workmen, but in bringing the workmen members of " the committee into touch with the wider view-point from " which jiroblems which they might have regarded as cou- " cerning themselves alone have to be considered, " Our exj)erience has admittedly been very short, and has " been gained under exceptional circumstances, and we ore " very reluctant to express any definite opinion at so early "a stage; but such experience as we have had justifies ■' the hope that in the formation of works committees of DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 95 " mixed constitution, as this is, whose powers may ulti- " mately be second only to those of the Board, lies the " solution of the difficulties between employer and employee, " which have arisen through the wide adoption of the ' ' limited liability company for the performance of industry " in place of what may be termed the family business," Clarke, Nicholls and Coombs, Limited* An example of the type of Profit-sharing in which part of the fund available for the payment of bonus is paid in cash and the remainder is credited to a provident fund for the benefit of the employees may be found in the scheme of a large London firm of confectionery manufacturers, Messrs. Clarke, NickoUs and Coombs, Limited, which came into force on January 1, 1890. The arrangement in this case is that " after paying all salaries, *' liabilities on agreements, making allowances for bad debts, " and the usual provision for depreciation and other reserves, " paying interest on debentures, dividend on preference shares, " and a dividend at the rate of 6 per cent.f on the ordinary capital " of the company, any balance of profit remaining will be divided " into two parts, of which one-half shall belong to the ordinary " shareholders, and go to^ augment their dividend, and the other "half shall belong to the total wages fund of the workpeople, " clerks, and other emi^loyees of the company, excepting such " as are paid wholly or in part by commission." The company's accounts are audited by a professional accountant. Eacb employee who has been at least twelve months in the company's service previous to the annual distribution is entitled tO' partici- pate, and shares in the proportion that the sum paid to' him or her in wages or salary bears to the total sum paid in wages and salaries during the year. The bonus is paid in cash. A certain number of employees each year are, of course, not entitled to participate owing to not having completed the qualifying jDeriod of twelve months' service ; and a sum is set aside representing what would have been paid to such employees had they possessed the necessary qualification, and is carried to a provident fund for the benefit of the employees. The balance yearly remaining to the credit of this fund is invested (under the control of the directors) in the company's debentures and preference shares, and forms the nucleus of a superannuation fund. All the benefits provided by the scheme are declared to be a free gift onJy, no right being confeiTed upon any person. * An account of the scheme in force in this business, giving much detailed information which cannot be inchided in this Report, will be found in " Experi- ments in Profit-sharing and Co-partnership : No. 2," issued by the Labour Co-partnership Association (6, Bloomsbury Square, London, W.C.I). This pamphlet contains a report of an address delivered by Mr. Alexander Horn, one of the Directors of the Company, on the 20th November, 1918 ; and of the discussion following thereupon. t The company states that it had paid 10 per cent, on its ordinary shares for two years prior to the introduction of the profit-sharing scheme, but it waa thought wiser to start dividing profits with the workpeople after only 6 per c«nt. had been paid to the ordinary shareholders. The directors suggested this aa, having every confidence in the scheme themselves, they thought, if the work- people saw something tangible within their grasp, they would be more likely to give it a fair trial. 24335 D 4 1)1') I)ETAII,i:i> KKI'Oin'. rhf lii'iit'tit> jtiiividcd \)\ iiiiMii- of tlu' piovidciil fuiui are (a) thr payiiuMit oi two-thirds oi tJunr wag'cs tor six wooks to cin- plovci's who tall ill : (h) tho i)aynuMit of £5 to the representatives nt a diMcased cinidoyee; (c) the pavnieiit of t'5 to women who marry attrr l)eiii;:'- five years in the company's service; (d) the j^radual accumulaliou of a superannuation fund. The amount now standing' to the cicdit of this superannuation fund, which is for the lienetit ot :ill employees who liave been 25 years in the service of th(> firm, is £02,000, invested in the cf(mi)any's shares and delientures. 'Ilic nninlH'i' of workjjwjple employed has fallen greatly during the \\;ii, the confectionery trade having been one of those whi(di wcK^ nnist affected by tiie reduced supply of sugar; the average number employed in 1914 was 2,800, or double the number, employed in 1918. Tlie number of workpeople wlio participated in the bonus shows, of course, a corresponding diminution, and fell to \XA2 in 1918; but the amount of the b(mus paid in 1918 and in 1919 (in respect of the profits of 1917 and 1918, respectively) was £]9,o00 in ea( h case, tlie largest amount ever paid. The proportion of Ixjiuis to the earnings of the workpeople, which varied fiom about 4 to G per cent, in the first seven years of the scheme, has never fallen beloAv 10 per cent, since 189T, and reached a percentage of 23o in 1918 and 24"o in 1919. Tho average percentage for the whole period of the existence of the scheme has been 12"9, and the tot;il amount allotted, from 1891 to 1919 inclusive, is £274,025. Xo special facilities are given for acquiring shares, but the acquisition of shares by employees is, according to the Return received from the company in connection with the present eiiquiiy. " encouraged where opportunity offers," and, in fact, 58 em- ployees hold shares. The total value of the shares so held, and of deposits held by 150 employees, is about £50,000 : most of this is rei)resented bv shares, the deposits being mostly of small amounts. The (>ompany consider that the scheme has, on the whole, given satisfaction both to themselves and to the workpeople; that it has promoted harmonious relations between employers and work- ])eople, and tended to lengthen the period during which their workpeople remain in their employment. So far as calling forth extra zeal on the part of the employees is concerned, however, they rej)ort that this has been experienced only to a limited extent, mainly amongst heads of departments or foremen, and the older employees. 11 . Dennis and Suns, Ltd. This is a firm of potato gi-owers and merchants, and fmit brokers, salesmen, and auctioneers, employing between 400 and 500 persons at their farms in Lincolnshire and the neighbouring counties. They also have agencies, offices. &c., in London, LiveqKX)!, Leicester,. Southam])ton. the Channel Islands and France; but the profit-sharing scheme does not apply to these places. It does, however, apply both to the farming and to the trading departments in Lincolnshire. DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 1)7 The sclieme, wliicli was explained to a meeting- of tlie work- people on Marcli 15tli, 1919, provides for the payment of the *' customary or market " rate of wages lo labour, and for interest at the rate of dh per cent, on land-owning capital, and at the rate of 6 per cent, on farming- and trading capital (horses, ploug-^hs, stock, &c.). All profits remaining- after these payments ' have been made will be divided into three equal shares, one of which will gx> to land-owning- capital, one to fanning and trading capital, and one to labour. x4.ll workers who have worked not less than one month (34 working days) will participate. Each worker will jjarticipate in projiortion to his earnings during the past twelve mouths. The bonus is to be paid in cash, and no stipulation is made as to its investment in whole ot in part ; but the Directors are prepared to consider proposals for the investment of any sums. In the event of there being a loss in any year, the loss will be carried forward to the succeeding year, and will come off future jirofits. The employee co-partners will be invited to nominate members to Committees of the Board which are to be set up to deal with wages, hours of work, and kindred matters. Women co-partners will be eligible to- sit on these Committees when questions affecting women arise. Xo restriction is placed on the freedom of the workers to join a Trade Union, or to leave the firm's employment at any time on giving the usual notice. William Gray and Company (1918), Ltd. This well-known firm of shipbuilders and marine engine builders introduced a profit-sharing scheme in March, 1919. It applies to all employees, male or female (except the directors), who have reached the age of 21 j^ears and have served at least twelve months. The number of persons who will come under the scheme is estimated at 4,000. The bonus consists of one-fifth of the net profits of each year, " after the Directors shall have made what, in their sole opinion, " are the necessary allocations." The trustees may, however, demand a certificate of the Company's auditor or auditors as to the exact amount of divisible profits available for division among the employees. The individual shares are determined by the employees' total earnings during the j'ear, exclusive of overtime. Where ^^ages are customarily paid on piece-rates, the bonus is calculated on the time-rate basis ruling in the trade. An employee who has left the firm's service (unless he was discharged for misconduct) is entitled to share in the bonus in proportion to the length of the period worked, provided that such period was at least three months. One of the most important clauses in the agreement is that relating to lost time, which reads : — " Employees who have without good and sufficient reason lost " more than twelve days' time during any year shall not par- " ticipate in the divisible profits. To enable a correct record of " time to be kept, every employee must take out a card, time- " board or check." *)S DETAILIIl) UlirOKT. Absence at recognised liolidays, absence through sickness^ thn)UKh })r4';ik(l<)\vn of jjUuit, or throuoli weather preventing work, or siniihir reasons, is not considered ;is " lost time." In certain circumstances, even time lost tiir()U<4ii strikes is not so considered. The rule with regard to strikes reads: as follows: — " Time lost by i-eason of a lock-out, general or district strike, " wliether autliorised by Trade Unions or not, shall not be con- " sidered as time wilfully lost, and shall not debar participation " in the (livisil)le profits. The directors of the Company are " most anxious not only to continue to work on the friendliest " relationship with the Trade Unions, but, if jwssible, to improve " that relationship. Time lost by reason of a strike on a scale " smaller than a district strike, shall be considered as wilfal " loss of time. . . ." The objects of the scheme, as set forth in the preamble to the agreement, are as follows: — " The Directors put forward the scheme with the objects of " giving every man and woman employed by the Company an " interest in its welfare, of encouraging them to keep good time " and avoid waste, and thereby increase the output of ships, " marine machinery and ship repairs, and of maintaining one "of Great Britain's vital industries in the face of severe foreign " competition which must shortly make itself felt. " The Directors are confident that their aims can be realised, " because they appreciate the fact that the good feeling between " the Company and its employees at West Hartlepool has been " a powerful factor in building up a business which is respected "' throughout the shipping world; and it is their earnest desire "' further to improve this relationship by sharing the profits of " the business with its employees, and in return they ask their " fuller co-operation for the future." The rules of the scheme are given in full in Appendix E. (pp. 194-G). Home and Colonial Stores, Limited. This well-known niultii)le-sliop company introduced a profit- sharing scheme in 1915, and the first bonus was paid in that year in respect of the profits of the year 1914. The bonus is paid to the whole of the employees at the company's branches, and the amount distributed is equivalent to the amount paid in dividend on the " A " ordinary shares of the company. The amount paid in 1915 in respect of the profits for 1914 was £25,000 : in each subsequent year £30,000 has been distributed. The amount is distributed amongst the individual employees who are with the company at the time of distribution in ])roi)ortion to the total wages paid to each participant for the year in question, and is calculated, in the case of an employee entering the company's service in the course of a year, from the day of his or her entry. Men serving with the Forces shared proportionately in resi)ect of the time spent in the company's service during the year in which they left, but from the time of joining the Forces they came under other arrangements. DETAILED ACCOUNT OP CERTAIN EXISTING SCHEMES. 99 The number of employees before tlie war was approximately 4,000. The average number in 1918 was 3,137, viz., 050 men, 371 boys, and 2,110 women and girls. The bonus (which is paid in cash) was sufficient to make an addition of one-seventh (over 14 jDer cent.) to the wages and salaries of all the participants. It will be obseiwed that the scheme was introduced early in the war, when some 200 of the company's employees had already left to join H.M. Forces. Writing- in July, 1915, the company reiDorted. : — " The annoimcement [of the profit-sharing scheme] and " the subsequent distribution of cash brought forth expres- " sions of gratification from our employees throughout the " kingdom, " It is difficult, owing to the dislocation of staff on account " of enlistments, tq state definitely the result as regards " increased zeal, &c. But as a matter of fact the staff have " had an exceptionally trying year, and there can be little " doubt that the scheme has tended to maintain the har- " monious relations which have been a feature of this " company's history in exceedingly difficult circumstances." Reporting in connection with the present enquiry the company say : — " The arrangement has worked well and has met with the " unqualified approval of our branch employees." Indemnity Mutual Marine Assurance Co., Ltd. The scheme of this company is interesting as being one of the very few profit-sharing schemes found in financial undertakings in this country. It is not unusual for such undertakings to give a gratuity to their employees at Christmas, often of substantial amount; but this is generally a gift pure and simple, un- co venanted, and bearing no fixed and definite relation to profits. The profit-sharing bonus of this company will supersede the gra- tuity jDreviously paid to employees at Christmas. It is interest- ing to note, in this connection, that Profit-sharing in France has attained some of its greatest successes in insurance companies.* The company introduced the profit-sharing scheme in January, 1918. Two per cent, of tbe underwriting profits in excess of £20,000 is divided among the staff; and all employees are eligible except {a) employees who have been dismissed or are under notice before the 31st December in any year; (h) employees seiwing the company under special agreement; and (c) porters, messengers, and the like. It was provided that the bonus should be paid to membervS of the staff who were absent on military service, or to their exe- cutors, under the following conditions:- — (i) In the event of an employee dying on seiwice, the bonus is to be paid to his executors. * See Report on Profit-sharing Abroad (Cd. 7283 of 1914), pp. 5, 12-13, 15-16, 19, and 124-7. IOC* . KK'I'AII.KI) RKl'ORT. (ii) If an employee returns to the company's sen-ice after ileniobilisation,aud completes twelve calendar months' service therein (or such shorter period as the Board may determine), the trustees are to pay over to him amounts standing- to his credit, (iii) If an employee does not return to the company's ser^-ice hi> Iwnus is not paid to him, but put into the common juxd of the '* Efficiency Fund " {see below). The Ixjuus is not paid until the third year after that to which the i>ixjfits i^late. The first Ixjnns, for example, which was paid in January of this year (1919), was based on the under- writing profits of the year 191b. This peculiarity is due to the s]iecial conditions of marine insurance, in which many months often elapse after a premium has been paid before it is known whether the '' risk " in respect of which the premium was paid will involve a loss, and, if so, how much the loss will be. The bonus fund, i.e., the product of the-2 per cent, charge on profits over £20,000, is paid over to trustees, who divide the fund into two equal parts, one of which is distributed in accord- ance with length of seiwice (service with H.M. Forces being counted as service with the company), the other in accordance with efHciency. The "Long Service" Fund is divided as follows : — Employees with less than 5 years' service, no bonus. 5 but less than 10 j-ears' service, 1 unit. ,, 10 ,, 15 ,, 2 units. 16 ,, 20 ,, 3 units. ,, 20 ,, 25 ,, 4 units. ,, 25 years' service or over, 5 units. Members may not assign or charge their share in the fund ; if they do so they will forfeit their share. The "Long Service" Fund paid in January, 1919, was divided among 15 employees, representing 44 "units," and amounted on the average to about 20 per cent, of their salaries; and it is anticipated that the bonus paid next year (in respect of 1917) may be even more substantial than this. The other half of the bonus, which is called the " Efficiency Fund," is not divided i^ any fixed manner, but distributed among qualified members of the staff as the Board may deter- mine. The whole of the " Efficiency Fund " need not be dis- tributed in each year; any part not distributed will be carried forward to a succeeding year. The " Efficiency Fund " in January. 1919. was divided among 25 employees, and repre- sented about 20 per cent, of their salaries. Both halves of the bonus are paid in cash. The amounts of the combined funds paid Aaried from 10 to 60 per cent, of the salaries of the recipients. It is, of course, too earlv for the company to pronounce an opinion as to tlie merits of the scheme, but they remark that " the staff of the company have always worked with the greatest zeal, and the relations between employers and employed have always been most satisfactory." DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 101 John Knight, Limited.* Tliis well-kuowu finn of soap muuuiacturers, whose works are at Silvertown (London, E.), have had a scheme of Profit-sharing in force since 1904. The original scheme i)rovided that, after 6 per cent, had been paid on capital, each em])loyee was to receive one week's wages for each additional 1 per cent, paid on capital. The bonus was paid in cash, though the participating employees were allowed to leave the whole or any part on deposit with the Company at interest. Early in 1909 the scheme was altered, and lialf a week's wag'es are now paid as bonus for each half per cent, paid on capital over 5 i)er cent. Henceforth also a third of the bonus Avas retained and invested in the Company's ordinary shares, in the names of trustees, on behalf of the employees. The i3i'oi:)oi'tion' retained for investment has, since 1912, been increased to one- half. There was originally an age limit for admission to the scheme, but this was abolished in 1912, and any employee who has been in the Company's service for at least three months, and who is recommended by his or her foreman, is qualified for admission. The conditions printed on the back of the form of receipt which the participating- employees are required to sig'n each year ])rovide that : — " Any employee g'uilty of misconduct, or who is proved to have been wasteful of the Company's property, or who does not take an interest in his or her work, or is a bad time- keeper, will be liable to have the whole or part of tlie bonus withheld. " Any employee discharged for dishonesty forfeits all claim to any sum standing to his or her credit in the bonus fund. " The Directors reserve to tlien) selves the right to decide, in each individual instance, as to whether the bonus has been earned or not." The number of employees during' the twelve months preceding the declaration of bonus in 1918 was about 90O, all but 30 of whom were i^ei'iU'iiient employees, and the numbei' of employees who jiarticipated in the bonus was 79G, who received £3,95'j, or three and a half weeks' wages. The average ratio of bonus to wages or salaries (including both the part paid in casJi and the j)art retained for investment) during- the period 1905-18 has been 6'1 per cent. The number who participated in the bonus distributed in February, 1919, was- 844 (including em- ployees in H.M. Forces), w^ho received £7,212, equal to four and a half weeks' wages, or 8' 65 per cent, on their earnings. The total amount held by the trustees on behalf of 911 employees in July, 1919, was £10,459. In addition. 34 em- ployees hold shares not obtained through the profit-sharing * The style of the Company, when the profit-sharing scheme was introduced, was '-John Knight and Sons, Ltd." The reconstitution ot the Company under its present title in. 1906, however, made no diHerence in the profit sharing arrangements. 1(»2 DETAILIiD REPORT. PclnMuo, to ihe tuiiouiil of £1.892 (nominal value), mostly in ordinary shares. The C()mi)aiiy have no arrangements under wliicli existing oniployetvs, a.s such, are rejjresented on the Board of Directors; hut it may ]>e mentioned that four of the seven Directors were formerly employed by the Company in the offices. The Company had a three weeks' strike i)i 1911, hut, apart from that, they regard the sroportion to the employee's success, as shown by the increase in the premiums collected. Employees serving with the Colours were included in the last distribution, that of 1915. Since the scheme was inaugurated the total amount of " remaining " profits distributed has been £3,390,000, of which £505.000 went to the shareholders, the same to the outdoor staff, and £2.205,000 to the policy-holders in the industrial hranch, who now number over 22 millions. The number of participating employees has varied from 14,370 in the first year to 19,277 in the year 1915, the last in which any DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 103 bonus was paid. The average pixjportioii of bonus to salaries during- the eight years in which a bonus was paid was 4"6 per cent. The war has, however, as might be expected, caused a heavy drain on the funds of all the life insurance companies, and not least on those of the Prudential, which is one of the largest. Fp to the end of the year 1918 it had paid over £4,900,000 in respect of over 230,000 claims. Besides the direct drain on the invested funds of the company through the excessive number of claims, the war has also affected its resources adversely through the operation of the Courts (Emergency Powers) Act, which pro- hibits (inter alia) the enforcement of the lapse of any life insur- ance policy " for an amount not exceeding £25, the premiums " on which are payable at not longer than monthly inter\'als, " and have been paid for at least the two years preceding the " fourth day of August, 1914." The combined effect of these two cau:ses has been to reduce the company's resources by an amount much gi^ater than that allotted as bonus in the pre-war year 1913. During- last year (1918) the company's funds were also subject to a heavy drain owing to the influenza epidemic : no less than £650,000 was paid in the industrial branch alone, and on civilian claims alone, in the two months from the 2nd November, 1918, to the end of the year. About 300 acting members of the staff are shareholders in the cx)mpany, holding £1 shares to the nominal value of about £27,600* in all, or 2' 8 per cent, of the total capital. The company have a Staff Provident Fund for the benefit of the outdoor staff (superintendents, assistant superintendents, and agents) in receipt of salaries not exceeding £400, and who have completed one year's service. To the employee's contributions (which must not exceed 5 per cent, cf his salary for the year) the company add 50 per cent. ; and, as a special inducement to employees to join as soon as they have completed a year's service, the company's contribution is increased to 100 per cent, for one year to those joining in their second year. Interest is paid both on the employees' own contributions and on the com- pany's additions thereto. The total amount of the fund on the 31st December, 1918, was £308,847, in the hands of 5,803 contri- butors; of which £196,511 represented the employees' own contributions, and £112,336 the company's additions thereto, including interest in each case. The company report that the profit-sharing scheme has given satisfaction to themselves and to their employees eligible to participate; that it has called forth extra zeal, promoted har- monious relations, and tended to lengthen the time during which their employees remain in their employment. E. S. and A. Robinson, Ltd. This is a firm of printers, paper bag and cardboard box manu- facturers, and manufacturing stationers, who started business about 75 years ago, and now employ upwards of 2,000 persons (men and boys, 1,200; women and girls, l,100i). 104 PKTAILHD REPORT. Scheme No. 1.— Tlie Hrm iutioduced a profit-sharing- scheme in lyi:^, unilcr which one-third of the net profit over and above a certain fixed mininunu is distributed amono- those employees who have been continuously in the company's sei-vioe for two years precinliii*,' the L*8tli Fel)rnary (the end of the company's financial year) and wliosc average rate of wages during- the year, when omi)luyed, does not exceed £(i (formerly £3) a week. Employees receiving over £6 a week also participate in the profits, under another scheme, by means of a l>onus varying- wiih the profit of the year. The share of profit is paid to the workers in proportion tx3 wages actually earned, with an addition of £1 for each year of service. For example, if a man's ivctual eai-iiings were £l(V), but he had been fifteen years in the firm's .service, his share would be calculat-ed on the sum of £115'. Men serving in H.M. Forces have received their share of the profits as though they were still in employment : their share has been calculated on what they would probably have earned if their employment had not been interrujited. The share of profits is paid in cash : it has increased every yeiu- since the start, and in the last two or three years repi-e- sented a very substantial addition to regular wages. Scheme No. 2. — The firm also have a sj-stem of AVorkpeople's Deposit Accounts, in which any jierson who has been in the em- ployment of the firm for two years or over may deposit his or her savings, provided his or her salaiy does not exceed £300 a year. Employees must not deposit more than 25 per cent, of their wages for the year, or have more than £200 on deposit. Deposits receive interest at a rate varjang from a minimum of 5 per cent, to a maximum of 10 per cent., according to profits. When the dividend on ordinary shares exceeds the average for the four years ended June, 1905, the rate of interest will be increased by the same amount. Supposing, for example, the average for the four years mentioned was 6 per cent., and the rate in one particular year was Sh per cent. ; then depositors would receive an additional 2^ per cent., making 7^ per cent, in all. The fixed minimum interest is paid quarterly : the additional interest (if any), varjdng with the profits, is paid Avithin three months of the close of the financial year. Savings may usually be withdrawn at a week's notice. In order to encourage i)ermanent saving, however, the firm reserve the right, by giving notice, to close the account of any dejwsitor who makes withdiawals too frequently. Accounts may also be closed for any other reason. Depositors leaving the firm's em- ployment receive their deposits, with interest at the fixed mini- mum rale, but do not receive any share in the additional interest ( var\'iug with profits) for the current financial year. The nu3nl)er of dei>ositors at the end of March, 1919, was 678, wli) had £23,870 to their credit, an average of over £35 each. The finn have a Welfare Committee, which discusses such things as holidays, arrangement of hours, canteens, working conditions, &c. The workpeople's representatives are elected by ballot : the men's and the women's representatives sit together on the 'iame Committee. DETAILED ACCOUNT OF CERTAIN EXISTING SCHEMES. 105 The fiiTu xeg-ard tlie profit-sliaring sckeme as satisfactory ; it has streng-thened the good feeling" existing between themselves and their workpeople, and has called forth extra zeal on the part of the workers. Firm No. 16. A firm of paper-makers in the West of England, employ- ing nearly 200 jjersons, have a profit-sharing scheme which dates from July, 1889. This scheme provides for the pay- ment to the employees of a bonus dependent on the profits of the business, this arrangement conferring no legal claim, but the amount to be certified by an accountant. The bonus is paid half-yearly, and is distributed among parti- cipants in the proportion of each worker's wages to the whole wages of the mill. The qualification for participating is that the employee must have been employed during the entire half-year, and must have been entered on the list of profit- sharers not later than the first month in the half-year, by his or her oAvn written request, Avith the consent of the firm. One-half of the pai'ticipant's bonus is paid in cash, the other half being credited to him as a provident fund, on which interest at 6j per cent, per annum is allowed half-yearly. The provident fund of an employee may be drawn out when he attains the age of TO, or completes 25 years' continuous service ; if he dies, his representatives get the amount at once. If he quits the service of the firm, provision is made for his getting his provident fund within a fortnight after the next half-yearly stocktaking, subject to the condition that not less than three months must elapse between the date of his leaving and the payment of his provident fund ; he also gets no part of his bonus for the current half-year. (The interval of three months is imposed as a deterrent to unthrifty employees, who might other- wise leave in order to get their provident fund immediately.) T]ie rules of the scheme provide that the sums credited to the provident fund may either be left on deposit with the firm or maj^ be placed in a savings bank; as a matter of fact the former course has been adojoted in all cases. Bonuses forfeited owing to profit-sharers leaving the firm's employment, and all other un- distributed shares of bonus, do not accrue to the firm but are held by them as a reserve fund, at Q\ per cent, interest, for the benefit of all or any workers, whether profit-sharers or not, at the discretion of the firm. There is at present on deposit with the firm a sum of £4,398, belonging to 171 emijloyees, and representing partly provident fund, and partly cash left on deposit. In addition, eight em- ployees have money on loan with the company, at 5 per cent, interest, to the total amount of £404. As regards its i-esults, the firm state that it has helped to promote harmonious relations between themselves and their lOlJ DETAILED UliPORT. '.v<)rkj)(M)j)li>. Tln'y have not had any strike or dispute since the introduction of the s( licnic. They do not consider, however, that it has called forth extra zeal on the part of tlie employees, or that it has tended t-o lenf,''then the average time for which their workpeople remain in their employment. (iii) Detailed Account of Certaix Abandoned Schemes. Henry Briggs, Son and Co., Ltd.* This scheme was introduced by Messrs. Briggs at their collieries (the AVhitwood and Methley Collieries) near Xorman- ton, in Yorkshire. In 1865 the firm turned their business into a limited company : most of the shares were taken by the partners, but a large amount of capital was oft'ered to the public, prefer- ence being given to the officers, workmen and customers of the fimi. At the same time the principle of Profit-sharing was intro- duced by a scheme thus described in the prospectus issued prior to the formation of the company: — "In order, however, to " associate capital and Labour still more intimately, the " founders of the company will recommend to the share- " holders that whenever the divisible profits accruing from " the business shall (after the usual reservation for redemp- " tion of capital and other legitimate allowances) exceed 10 *' per cent, on the capital embarked, all those employed by the " company, whether as managers or agents at fixed salaries, "or as workpeople, shall receive one-half of such excess profit " as a bonus, to be distributed amongst them in proportion to, " and as a percentage upon, their respective earnings during " the year in which such profits shall have accrued." It was further arranged that the bonus received by those employees who took shares in the company should be at a higher rate than that received by those who did not hold shares, the former class receiving on the first distribution of bonus, twice as much, on subsequent distributions half as much bonus again, as the latter. In 1872 the price of coal and the rate of colliers' wages rose rapidly, the advances in wag(»s granted to the miners being an increase in the aggregate of from 2T| to 30 per cent, upon their standard rate;t and it was thought proper to increase the minimum rate of interest on capital from 10 to 15 per cent. The first division of profits on the new basis was that for the year ending June 30. 1873: and this basis was maintained during the rest of the period during which the profit-sharing scheme was in i • Further particulars of this well-known scheme will be found in Methods of !>ocinl Reform, by W. Stanley .Tevons (pp. 122-155) ; Industrial Partnerships, by H. C. Briggs ; Thornton. On Labour (pp. .348-355) ; Prnfit-sharinr), by Sedley Taylor (pp. 117-154); Die Geirinnbetheilignng, by H. Frommer (pp. 11-34) ; Profit-sharing hctii-ern Employer and Employee, by N. P. Gilman (pp. 243-272) : Co-operatire Production, by Benjamin Jones (pp. 494-499). t It is asserted that by June. 1873, the advance in wages had increased to at least 50 per cent, on the original standard. {^Co-operative Production, by Benjamin Jones, p. 497.) DETAILED ACCOUNT OP CERTAIN ABANDONED SCHEMES. 107 force. The total amount received by the eraployees as bonus was as follows : — £ Year ending June 30, 1866 1,800 1867 2,700 1868 3,150 1869 3,462 1870 1,740 1871 1,745 1872 5,250 1873 14,256 1874 6,048 Total £40,151 Thus, during the nine years covered by the Table, the average amount received as bonus was about £4,460 a year. What was the average ratio of bonus to wages during this period as a whole is not stated by the authorities consulted : the ratio for 1865-66 is, however, given as 10 per cent, in the case of shareholding, and 5 per cent, in the case of non-shareholding employees, and the ratio for 1866-67 as 12 per cent, in the case of shareholding and 8 per cent, in the case of non-shareholding employees; while it would seem that the bonus divisible for 1871-72 was at the rates of 9 and 6 per cent, for shareholders and non-shareholders respectively. As regards the numbers participating, it is stated that the number of employees participating in the year ending June 30, 1873, was 1,937, and the number participating in 1874 was 2,218.* It is stated that in 1868 the number of persons employed in these collieries was 989 adults and 214 boys, and that in the earjy part of 1869, out of 989 adult workmen, 144 held between them 178 shares, equal at par value to £1,780. From the first adop- tion of the profit-sharing scheme there had been a committee of the workmen, called together from time to time to give advice in respect to improving the processes of coal mining; and, as the accounts were verified each year by a professional accountant chosen by the shareholders, the employees had always a full knowledge of the affairs of the business, though at first no direct control. In 1869, however, one of the workmen share- holders, elected by his fellows, was given a seat on the board of five directors. It will be seen that the arrangements made to carry out the method of industrial partnership were m many respects singularly complete ; and their effect upon the conduct of the workmen was for some time considered to be very satisfactory. A spirit of harmony between employer and employed was developed, such small disputes as arose being amicably settled without loss of time; the coal was got in a more careful manner; there was a considerable saving in timber used for props, &c. The men showed a willingness to work extra hours * Profit-sharing, by Sedley Taylor, p. 147. lOS DHTAlIiED REPORT. when this was asked of Uu'iii in the interests oi the busiuess, and ■j^enoially were readier to obey orders than before the introductiou of Profit-sharing. The circumstances which led to the abaiidiJiinienL of the method of Profit-sharing were briefly as follows: — Messrs, Jiriggs had h(»}u'd that Profit-sharing would be accepted by their workmen as a .substitute for Trade Union organi- sation, they, on tlieir part, abstaining from joining any com- bination of emi)loyers for the regulation of wages. " Until the " summer of 1808, the -workmen seemed to enter into these views; " but at that time a growing desire to join the Union began to ■'manifest itself, on the ground that, as the company agreed to " pay the average w€<'kly wages of the district as well as a share " in the profits, and as the Union tended to raise those wages, it ■■ was to the interest of tlie workmen to aid in that endeavour."* In 1872, after the directors had fixed upon August 19 for the annual meeting of the shareholders, they received a notice stating that a great meeting and demonstration of the Miners' Union was to take place on that day, and requesting that work at the pits .shouhl be stopped in order to enable the men to attend. There- upon tlie managing director, Mr. Archibald Briggs, issued notices to the eifect that those who stayed away from work on August 10 would forfeit all claim to bonus for the future, and must take their chance of losing the bonus for the past year, since it lay in tlie i)ower of the shareholders to settle what bonus was to be given, and to whom; and the men were told in plain terms that they had U) choose between Profit-sharing and Trade Unionism. Al>out one-third of the men stayed away from work, and were deprived of bonus until reinstated the following Christmas. During 1873, a year in which the coal trade was very prosperous, the relations between Messrs. Briggs and their men, though not so good as before, were fairly satisfactory ;t but in 1874 a dispute aixjse about the use of " riddles " for sifting the coal in the pits. The use of riddles underground had, for reasons into which it is unnecessary to enter here, long been a grievance in the eyes of the Yorkshire miners; during the fat years, when coal was so much sought after that even " smudge " was saleable, the men liad been allowed to send up the coal unsifted, a slight reduction being made in their tonnage rate of wages. Now that prices were falling, tlie emjiloyers wished to revert to the use of the riddle in their pits: but the Trade Union declared that never again should riddles be introduced; and Messr'^. Briggs's men for * Memorandum bv Messrs. Briggs in Sedley Taylor's Pmnf-ithurhn/. pp. 122, 12.3. ... t At this time "some of the surrounding colliery proprietors, anxious to attract men to their pits and secure as large a share as possible of the great prosperity, and finding the l)onus given by our company was a great inducement to men to remain with us, began to offer something beyond the regular wages of the district, saying it was 'instead of Briggs's bonus,' thus strengthening the ▼iew already entertained by some discontented men that the bonus was something kept back out of the weekly wages to be given at the end of the year, and that if we could pay it the?i we could give it to them weekly just as well " fMeraorandum by ]Messrs. Briggs in Sedley Taylor's Pmiit-sharinfj, p. 125.) DETAILED ACCOUNT OF CERTAIN ABANDONED SCHEMES. lOi) some time declined to use them. " Tiie events above described " did not, however, lead at once to the abolition of the industrial "■ partnership system. At the meeting- of shareholders held iu " Angiist, 1874, it was decided not entirely to abandon it, but to " give it one more chance, modifying', however, the rules regula- " ting the distribution of the bonus, and making these rules " more stringent."* Not long after this Messrs. Briggs, in common with the other employers of the district, announced their intention of reducing the men's wages. This reduction the miners, including those employed by Messrs. Briggs, declined to accept, and a strike of four weeks' duration ensued. As the direct consequence of this fact " the final step was taken, and " a resolution passed at the half-yearly meeting of shareholders, " held in February, 1875, that the payment of a bonus on the " industrial partnership principle should be discontinued. " Many of the men themselves had expressed a wish to the same " effect, having an idea that we were in some way merely " keeping back a portion of their wages to be probably (but not "certainly) returned to them at the end of the year; and they ** said they would prefer io be paid precisely the same wages, " and be put on the same footing, as men at other collieries. "t In connection with this case it is worth noting that the system adopted did not partake of the nature oi a definite, binding agree- ment between employers and employed, since the shareholders might at any time refuse to^ vote the bonus. Among the reasons for the workpeople's dissatisfaction with the scheme appear to have been the facts (a) that the initial rate of dividend reserved to the shareholders before any division of profits in favour of the employees could take place was raised by 50 per cent, when wages advanced, but no proposal appears to have been made to reduce it when a reduction in wages was proposed; (h) that in 1873 a sum of £30,000 was taken out of the last year's profits and invested In a new mine, the shareholders getting new shares in respect of the purchase, but the employees losing £15,000 of bonus, which would otherwise have come to them as their share of this £30,000 ; and (,c) that ithe employees' share in profits was further diminished, because (as is stated) " large sums were placed to depreciation and reserve funds, " altogether out of proportion to what is usual, and the men were '' thereby deprived of the share which ought to have come to " them as bonus. In the two years 1873-4, the reserve was ."increased by £26,600; and in the three years 1873-4-5 'stores, " ' repairs, renewals, and depreciations ' were credited with "£151. 377. "i Messrs. Gilbert Brothers. This firm of boot manufacturers, at Nantwich, is believed to have been the first§ to take advantage of an Act, passed in 1907, entitled the "Limited Partnerships Act," under which it is * Memorandum by Messrs. Briggs in Sedley Taylor's Fro/it-sharing, pp. 128, 129. t Ibid., p. 129. X Co-optrative Produclion, by Benjamin Jones, pp. 497-8. § According to the Companies Department of the Board of Trade, no other firm has taken advantage of this Act. no DHTAILEU lUirullT. IKjssihIo ior th<.^ employees of a private firm, collectively, to acquire an interest in the business. The Act, which came into oju'iMtion on ,I;inuary I, 1908, enables the lormation of limited partnersiups, by virtue of which one or more individuals can, afl " limited partners," enter into partnership with other persons who are called " general partners." A body CQrpora,te may become a limited partner. The limited partners contribute to the partnership capital in cash or in other property valued at a stated amount, but are not liable for the debts or obligations of the firm beyond the amount so contributed. The Act further provides that ** a limited partner shall not take part in tho " management of the partnership business, and shall not have " power to bind the firm," but he " may by himself or hie agent " at any time inspect the books of the firm and examine into the " state and prospects of the partnership business, and may advise " with the ^lartners thereon." ]\res9rs. Gilbert Brothers began by introducing in 1907 a scheme of 'h-ofit-sharing, under which a fixed proportion of their profits was allotted to the payment of bonus to their employees ; and in December, 1907, 108 of their employees received a bonus in respect of the year ending June, 1907, under this scheme. In 1908, however, this system of Profit-sharing was further developed by taking advantage of the new Limited Partnerships Act. The emi)loyees of the firm formed a Society, which, in June, 1908, was registered under the Industrial and Provident Societies Act, 1893, under the name of *' Gilbert Brothers* " Employees, Limited." By the Special Eules of this Society its objects are declared to be *' to carry on the industries, busi- " nesses and trades of manufacturers of and dealers in boots, " shoes, and every kind of footwear, both wholesale and retail, " and whether alone or in limited partnership with any other " society, company, firm, or person." The Rules further pro- vide that "the following may be admitted members; {a) em- " ployees of Gilbert Brothers, wholesale shoe manufacturers, " Xantwich, who have been employed for at least six months; " (6) the managing partners for the time being of that business; " {(■) other persons ai)proved by such managing partners and " elected by the committee of the society. This committee, " which is elected from those who have been members of the " society for at least two years and have at least £10 paid-up " in the shares of the society, possesses the ordinary powers and " duties of a committee of management, but does not posses;^ " certain special powers and duties, which are assigned to a '' separate committee termed ' the Finance Committee.' This 1'^ Finance Committee consists of not less than four and not more " than five members, and its powers and duties are thus ^'defined: — "H) It^ may at all reasonable times inspect the books of 1'^ any partnership in which the society is a limited '' partner and examine into the state and prospects of ^1 the partnership business, and may advise with the "general partners thereon and (in so far as the same "i«: permitted hy the Limited Partnerships Act, DETAILED ACCOUNT OF CERTAIN ABANDONED SCHEMES. Ill " 1907), may meet and confer with the general " partners whenever occasion requires upon all difter- " ences and questions concerning- the capital of the " partnership and the managers' salaries. " (2) It shall inform the employees of any such partnership " by notice in writing to each employee, or at a " general meeting of the society, how much (herein- " after called Part A) of the profit-sharing fund as " defined in any agreement for sharing profits be- " tween such partnership and its employees, is paid " as bonus or dividend on the wages or salary of those " employees taken collectively who, at the date to " which the accounts of the partnership were made up, " were members of the society or under the age of " 16 years, and how much (hereinafter called Part B) " is paid as bonus or dividend upon the wages or " salaries of the other employees collectively." ** (3) It shall further privately inform the accountant of the *' society how much of Part A is declared in respect of " the wages or salary of each member, and of each '* employee under 16 years of age." It is provided 'that " all sums received by the Society, under " arrangements of or with Gilbert Brothers, for sharing profits " with its employees J shall be treated as capital and not as income "of this Society. They shall be invested according to the rule "with respect to investment set forth below, and credited in the "books of the Society, as follows: — " (1) Each member of the Society shall be credited with the " amount received by the Society as dividend or bonus " on his wages or salary, such amounts not to be " withdrawn so long as he is a member of the Society " and has less than £200 fully paid-up in the "shares of the Society; but, whenever there is a " sufficient sum standing to his credit, enough shall " be transferred to his share account to create a fully " paid-up share in the Society until he has £200 fully " paid-up in the shares of the Society; and application " for membership of the Society shall be taken to " include application from time to time for any such " share or shares. " (2) Any amount received by the Society in respect of an " employee under 16 years of age shall be entered in " his name until he is 16 years of age. If he then, " or within one year afterwards, becomes a member, " it shall be transferred to his share account, and " otherwise to Part B. " (3) The Society shall hold that part of its capital repre- " senting Part B as a non-members' provident fund " for the benefit of all employees of Gilbert Brothers, " who, from time to time, are not members of the *' Society, or their wives, children, or widows, or 1 ]'J DKTAlIiKD KKl'OllT. " persons depeiulent on tlieui, to he administered " under regulations made by the committee of manage- " ment of the Society from time to time and approved " by the managing partners of Gilbert Brothers." Shares were to be of two kinds, "Invested" and " Accumu- " lated," the latter being shares paid-up in the manner stated above under (1) and (2), while all other shares were called in- vested shares. Invested shares were to have preference both as t person was to hold more than £100 in invested shares. The capital of the Society, except such sunjs as might appear to the committee to be likely to be necessary to meet the current expenses of the Society, and to pay out any of its members who might at any time cease to be employees of Gilbert Brothers tor at least six months, or to satisfy the purposes for which the non- members' provident fund was held, were, in furtherance of it< objects, to be apj^lied in augmentation of the Society's share or intei-est in Gilbert Brothers as a limited partner therein, or in the purchase of the whole of such business. Subject to the above, the committee might invest in the manner jirovided in the general rulesw Interest on shares was to be at the rate of 5 per cent, per annum M-henever the profits of the Society, after extinguishing any adverse balance and providing for reduction of preliminary expenses, and for any subscriptions due to propaganda organisa- tions, sufficed to pay such interest. Any surplus profit was to be applied in forming a reserve fund, applicable by resolution of any general meeting on a recommendation of the committee to meet any contingency' affecting the Society, or for any other pui'pose, whether within the objects of the Society or not, other than the payment of interest on shares, provided that notice of every such recommendation be given to every member not less than six clear days before such meeting. The terms of the partnership agreement which, on July 28, 1908, was entered into between Messrs. Gilbert Brothers, as general partners, and the Society, as limited partner, provided that the partnership should commence as from June 30, 1907, and should continue until three months' notice of intention to terminate it should have been given by any partner, or until the whole of the capital should have been acquired by the limited partner. The agreement also provided that, after paying salaries to the general partners (the two Messrs,. Gilbert), depreciation, and interest on capital at 5 per cent., the remaining profit should go to form a profit-sharing fund, until Is. in the pound should have been paid on wages, and, after that, a reserve fund. The agreement also provided that, as the amount of capital belong- ing to the employees increased, the capital belonging to the general partners should be reduced; and that, when the two general partners had been entirely paid out, then the business should belong to the Employees' Society as their sole property, and l)e carried on by that Society as a workers' productive society. During the twelve months ended 80th June, 1912, the last year for which the agreement was in force, the firm had an DETAILED ACCOUNT OF CERTAIN ABANDONED SCHEMES. 1 IP> average of 94 workpeople in their employment, of whom 92 were members of " Gilbert Brothers' Employees, Limited," and parti- cipated in profits, receiving £151, being at the rate of 5 per cent, on their wages. Later in the year 1912, however, the scheme was abandoned at the reqnest of the employees them- selves, Avhoi had recently joined the National Union of Boot and Shoe Operatives. There was a dispute in 1913, the trade union workpeople being withdrawn for one week in support of a demand for an improved scale of payment. Later in the same year the factory was transferred to other owners. Irvine^s Shipbuilding and Drjj Dochif Company, Limited. This scheme was introdiued by Sir Christopher (afterwards Lord) Furness in the two shipyards with which he was connected, viz., the Middleton Shipbuilding Yard at Hartlepool, and the Harbour Dockyard at West Hartlepool, both belonging to Irvine's Shipbuilding and Dry Docks Company, Limited. In a speech delivered to representatives of the trade unions concerned, on October Tth, 1908, he referred to the great damage done to the shipbuilding industry by the disputes which had taken place therein during the previous year or two. In parti- cular he pointed out that the liability to strikes, with the consequent delay, made it ditHcult for shipbuilders to take con- tracts to which a time-limit was attacheil, since it was impossible for them to guarantee that the ships would be completed within the specified time. It is stated, in this connection, that four steamers built bv the companv during these years were respec- tively 152 days, 273 days, 304 days and 2T3 days late. He therefore made two alternative offers. 'Vhe first was to hand over to the trade unions, either singly or in combination, the company's shipyards at AY est Hartlepool as going concerns, for such sum or sums as might be determined by a recognised firm of assessors, appointed by joint nomination. Sir C. Furness undertook that the company would not be exacting while the business under its new control was in the preliminary stages, that they would allow them ample time to raise part of the pur- chase money, and would readily convey to the new management all the information at their command and such suggestions as miglit prove of service. The second alternative was that the employees should become " limited co-partners " in the shipbuilding business of the exist- ing company. Special shares, called employee-shares, were to be issued, the workpeople paying for them by a deduction of 5 per cent.* from their earnings until the amount was covered,. Interest at the fixed rate of 4 per cent, was to be paid on the amount paid-up on the employee-shares, whether any surplus dividend was earned or not; and, in addition, they would receive a share proportionate to the amount of their holdings, and pari passu with the ordinary shareholders, in the sum remaining after paying a cumulative dividend of 5 per cent, on the ordinary * In the scheme as ultimately introduced, the deduction was only 2i per cent, in the case of men whose standard rate of wages was 24*-. a week or under. in innwiLVA) up:roRT. sliiui's and tho appropriations for depreciation, reserve, and (U'vt'U)i)inont funds. The amounts so paid as bonus out of profits would l)o (Unvoted, in whole or in part, to the credit of the shares hehl by tho employees. A workman leavinj^ the sei-A'ice of the company would be free to sell his shares to one or more of his fellow-employees at an assessed or arbitrated value, based on the market price of the . day. I The works would continue to be under the control of a board of directors, with the supreme power, as before, vested in the chairman and manag-ing- director; and the distribution of the funds of the company would remain solely in the hands of the company's officers, as before. In particular, the amounts to be set aside for depreciation, for developments, and for reserve, would be entirely in the discretion of the directors. It was to be made an imperative condition of the agreement that the employee co-partners should not, under any circum- stances whatever, go> on strike, while the company gave up their right to lock them out. It was hoped that the labour co-partners would submit any complaints against the manage- ment, in a friendly spirit, thix)ugh the works council (see below). It was to be understood that a strike would overthrow the sysiem. It was also hoped and expected that the labour co-partners would show constant concern for the success of the business; would discourage waste and " watch keenly every possible avenue *' for the adoption of economies " ; would do their work zealously, and not put any obstacles in the way of their co-partners doing the same ; and would indicate to the works council directions in which unnecessary supervision or clerical labour might be withdrawn. The Works Council referred to was a body composed of an equal number of representatives of the employees and rep re- sentatives of the firm. Sir C. Furness desired, for convenience sake, that the workpeople's representatives should be actual employees of the company ; but he was prepared to consider the admission of trade union officials, not being employees, as sup- plementary members, i.e., as a kind of ''aldermen." The functions of the "Works Council are thus described: — ** It would be a kind of Court of Reference and Committee " of Counsel rolled into one. Its chief purposes would be the ** promotion of friendly communication between the firm and "its labour partners on all affairs of common interest; and " an important part of its duty would be to take into' con- ** sideration on the instant, before any ill-temper had entered "into them, all matters or incidents calculated to breed ** friction in all or any of the departments of the establish- ** ments. I would have it made a medium for the asking ** of straight questions on any matter of concern ; and, on the *' other hand, I would have it used by the officers of the firm ^' to convey frankly to the represent^i fives knowledge of any ** circumstances or conditions that might at the moment be " influencing the business prospects and efficiency of the " company." DETAILED ACCOUNT OP CERTAIN ABANDONED SCHEMES. 115 Sir C. Furness explained that the autliority to engage, instruct, direct, suspend or discharge employees remained in the hands of the officials of the company alone. In the event of the Works Council failing to agree upon any major matter in controversy, the question would be referred for settlement to a Court of Arbitration; and alternative means of constituting such a Court were suggested. At a further conference in November, 1908, after the scheme had been discussed by the Trade Unions concerned, the scheme was accepted by the workpeople; and the necessary special reso- lutions were passed by the shareholders on 29th December, 1908, and confirmed on 13th January, 1909. A deed, of indenture embodying the terms of the scheme was entered into by Sir C. Furness on 1st February, and the scheme came into force on 31st March, 1909. It applied to all skilled and unskilled labour, except casual workers; anj^ man employed for 28 days consecutively ceased to be a casual worker. Membership of a Trade Union was made compulsory for men to whom the scheme apj)lied. The number of employees' shares was 50,000, and the nominal value was £1 each. All employees to whom the scheme applied were obliged to apj)ly for a minimum of ten £1 emi^loyee-shares, but might apply for more. The employee-shares conferred no right of attending or voting at the ordinary shareholders' meetings, but separate general meetings of employee-shareholders might be held. In December, 1909, the company announced that it was pro- posed to pay a dividend at the rate of 5 per cent., over and above the minimum guaranteed rate, in respect of the nine months ended 31st December, 1909. Employee-shareholders thus re- ceived 9 per cent, in all (4 per cent, minimum phis 5 per cent, dividend), and the ordinary shareholders 10 per cent, (fixed rate of 5 per cent. jAus contingent additional rate of 5 per cent.). The emjjloyee-shareholders, in reply to a request fix)ni the directors for an indication of their attitude towards the scheme, held a meeting at the end of December, and signified their desire to continue under the scheme. On the completion of the first financial year, which was stated to be provisional, the question of continuing under the scheme was put to a vote of the Trade Unions. In five Trade Unions where all the members were allowed to vote, whether co-partners or not, the voting was 85 in favour of continuance and 504 against. In ten other societies, where only co-partners voted, the voting was 302 for and 354 against. Thereupon a vote was taken of all the co-partner employees, and resulted in a vote of 492 for and 598 against. The total number of employees was between 1,500 and 2,000, so that a large proportion did not vote. The adverse vote is said to have been due to disappointment at the fact that employment under the co-partnership scheme had not been absolutely uninterrupted for all the labour co-partners. It is also stated that some of the employee co-partners had found 1 ]{] DI.TAILHI) liKroUT. it (iillicult Ui ^llal»' tlu" (•{inii)uls<)rv (k'(lu(li<)U jioiu wa^es ; and aiiotluT alleyiMl caiiso of comiilaint was ihat men teini><)rarily out of work at the Irvine Sliipbuiltliiig Company's yards were unable to get ^m])loyment at other local yards, owin^- to the hostility of the men a1 those yards to the f()-])aitnershii) scheme. .\olis on (filter Abondoncfl Schemes. All till,' luinrniation that is now available — or all that is woi ili^ giving at this distance of time — with regard lo manj- of the] schemes of Profit-sharing or Co-partnership which have ceased to exist is contained in Ai)pendix B. In some cases, however, additional information is available which seems to be worth pre- serving as of permanent value even in the altered condition^ of the present day. This is partiinilarly the case where the only complete account of a scheme is contained in the Report on Frojit-slmring , issued in 1894, which has long been out of print. The folloAving notes are accordingly taken, for the most part, from the 1(S04 Keport, or from statements subsequently made to the Bnaid of Trade, or to this T)e])artnient, by the firms themselves. l-'r of} [-sharing in Agriculture. — Twenty-three schemes of Protitr sharing in agriculture are known to have been in operation in this couutiy at one time or another, eight of which are now in <^xistence. Of the 15 abandoned schemes, a large propoiiion were introduced and carried on by wealthy landowners or large tenant farmers for philanthropic reason <, the financial results being generally very disappointing. Xine of the 15 schemes were started in the years 1882-95. and were therefore involved, during a large part of their course, in the a(;ute agricultural depression that occurred at the end of the nineteenth century; and it is not surprising that Profit --sharing under these circum- stances was unsuccessful. The more recent schemes do not, in general, jiresent any features of special interest. "With regard to one of them (^lessrs. Paget and Allsebiyjok's scheme) Mr. AA'ilton AUsebrook wrote, under date of March, 1919 : — " I have always been an advocate of l^rofit-sharing. and had hoped that it would make the men more careful of their tools, imple- ments, etc., and more industrious, keeping better time. etc. But I mu.st confess that, though I always kept on good terms with my men, and they were always very grateful to receive their bonus at the time. I have never been able to observe any difference whatever in their demeanour as affecting time-keeping, and carefulness. They are t(X) .short Kigbted.' Tiie remaining schemes which have been selected for notice existed in a great variety of industnes, and it has not been thought necessary to classify them under industrial headings. }fessrs. Aitken, Dott S{ Son, frame-makers, of Edinburgh, adopted Profit-sharing in 1889, but discontinued it in the follow- ing year. They wrote as follows with regard to this scheme: — '• Our hands being elderly, as a rule, seemed to keep on at the t-amo pace as before. The sjstem was stojiped by us because we (at the time) wished it to be the prelude to a more co-operative system. NOTES ON OTHER ABANDONED SCHEMES. 117 in Avhich the workers Avere to run a slight risk, but make, under normal conditions, a larger profit or income to themselves. They Mere by no means unanimous, but probably a majority were against running the infinitesimal risk they Avere called upon to run. We thereupon closed all abnormal relations, and fell back into paying the fair current wages of the trade." Mr. Joseph Bromhead, who' employed nearly 100 persons in a laundry near Bristol, adopted a system of Profit-sharing in NoA^ember,- 1890, but gave it up at the end of the fir.st year because it was not found to produce satisfactory results. Mr. Bromhead stated that his experience led him to believe that better results are toi be obtained by putting- employees on piece-wage than by offering them a share in profits. Mr. Joseph CoJlard, a printer and stationer in London, adopted a system of Profit-sharing in October, 1891, based on the distribu- tion of 5 per cent, of the net profits, without deducting anything for interest on capital or personal management. He abandoned the scheme in 1893. for the reasons mentioned in a report to the Dejjartment, as follows: — " I haA-e not found the profit-sharing system work aa'cU as applied to all classes of AA'orkers. My last balance-sheet, quite recently pre- pared, shoAAS that the AAork generally' has cost me more. I haA'e done a larger trade, but made less profit than the previous year. In future, I .shall only giA^e bonuses to those who deserve it, foremen and others Avho help in the management." Messrs. John Devereux and Sons, of Lowestoft, grocers and pro- vision merchants, introduced a scheme of Profit-sharing in 1892. At first they were well satisfied, finding that zeal w^as evoked, the stock better looked after, waste gniarded against, and better atten- tion given to the business generally. They thought they were largely recouped for the bonus by the additional energy displayed. In 1897, however, they abandoned the system. "We found it admirable," they wrote, " for the first two years; but after that all interest died out, and the thing became practically a dead letter. AVfl»do not see anv extra zeal evoked by the majority of the staff." Two ladies interested in social problems. Miss Mary Hamilton and Miss Edith Simcox, started a business on profit-sharing lines in 1876 under the style of Hamilton and Company. The business was turned into a limited company in 1883, and wound up in 1891. jN"o profit-sharing bonus was i>aid, excejit in 1882, 1883 and (on a very small scale) in 1889. This was one of a number of undertakings in the dressmaking and millineiy trades which were started by philanthropic persons with a view to improving the jiosition of needlewomen, and which wei'e all unsmocessful, at least from the financial point of vicAV. Miss Simcox, however, api>eans to have considcreid that the experiment was worth making for other than financial reasons. )She wrote : — " Tlie confidential intercourse betAveen employers and employed possible when the former have no Avish to conceal their actual profits, and are sincerely desirous to share such profits as they can make, certainly tends to promote harmony. But I am inclined to lis DI'ITAILKI) ItHI'OHT. atliuh iiion* iiMix)rtiUKo to closo personal intercourse and sympathy hotwi'cn I'inploycrs and employed than to the formal promise of a share in prolits. If tho latter is only intended as a bribe for ' extra zeal,' tho operatives will view it with suspicion, and with good reason, for if a few firms make extra profits by the help of such ' extra zeal,' tho rest of tho trade will try to do tho same, and tho result all round would hv, at best, rather more work for rather moro money, and not impossibly rather more work for the same money. Strugf^ling firms in financial difficulties will not find a royal road to dividends paved by good intentions about Profit-sharing. A well-managed and successful business will work more pleasantly, and tho partners will get their money's worth in the gain of their employees, if they resolve frankly to transfer a i)ortion of the profits they might spend or re-invest to the whole Iwdy of workers by whose help the profits were earned. The firm that takes a step of this kind helps to raise the standard of living among the workmen con- cerned; it does not raise its own dividends." For ])articulars of the iin successful Profit-sharing- experiment of Mr. Herbert Hutchinson, a buikler and arcliitect of Haslemere, who afterwards turned his business into a co-operative society, see pp. 14G-8). Messrs. Idris and Covipani/, Limited, mineral water manu- facturers, of London, adopted Profit-sharing- in 1890. x\fter pay- ment of fair salaries to the partners for manag-ement, and of interest on capital (at the rate of 5 and 6 per cent, on debentures, G and T per cent, on preference shares, and 10 per cent, on ordinary- shares), the surplus, if any, was divided beiween the shareholders and the employees in proportion to the amount of capital held or of wag-es or salaries earned by each. Part of the bonus was paid in cash, and part credited to a Benevolent Fund ; but employees were encourag-ed to invest their cash bonuses in preference shares, and it was announced that employees who took these shares would receive a supplementarj- bonus in future distributions. The firm reported that many of the reg-ular employees appre- ciated the scheme, but that it caused dissatisfaction among the casual workers, who are employed in large numbers in the mineral water trade during the busy season. The^ employees did not participate in the bonus. Some also of the regular workers did not appreciate it. The finii, therefore, decided to alter the basis of distribution among the individual employees; henceforth the share of each participant was hxed at the dis- cretion of the managers. AVriting in 1893, the firm reported that the facilities for em- ployees to invest their bonus in shares had worked well, and that the moral of the whole of their employees had improved. Four years later, however, they wrote that they had been disappointed to find that the money had not been used, in many cases, in the way they had intended, viz., as a provision for old age and sickness. The scheme was discontinued in 1903, owing to depression of trade. Messrs. McVifie and Price, Limited, introduced a profit-sharing scheme in 1890, under which a fixed percentage of their profits was allotted to their employees as bonus. The bonus was paid NOTES ON OTHER ABANDONED SCHEMES. 119 in cash. In reply to an enquiry as to whether the scheme had proved satisfactory, the firm wrote in 1893 : — " This is a moot point; we are not satisfied with the results of the experiment so far as it has gone, but we have no intention of dis- continuing the payment of the bonus. We employ a large number of young people, and think that the interval between payments (one year) is too long. We propose having half-yearly or quarterly pay- ments, and will see how that turns out. The effect on a number of our hands has been excellent, but on the larger proportion the results cannot be discerned till within a month of the payment of bonus, and a month after they ha%'e lapsed into the usual condition of ' factory hands,' neither worse nor better." The scheme was suspended for some years after the destruction of the works by fire in 1894; it was afterwards revived, but was definitely abandoned two or three years ago, the employees being dissatisfied with the reduction of bonus, consequent on a decline of profits. Messrs. Osbonie and Young, Limited, corn and fomge mer- chants and flour factors, of Brixton, introduced a profit-sharing scheme in 1890, under which their employees received half of all profits in excess of the average for a series of years before Profit- sharing began. The bonus was paid in cash, or it might be left on deposit with the firm at 5 per cent, interest. The bonus in the fi^rst three years averaged 6' 6 per cent, on wages and salaries, and the firm at this time were highly satisfied. " The Profit-sharing has undoubtedly proved a great success," they wrote, " especially among the thoughtful and more intelligent of the employees. The greatest harmony and good feeling exist. ... It also begets a readiness and a Avillingness to serve when required, irrespective of the exact time for leaving work." The firm also found gi-eater carefulness to prevent waste; better care of horses, harness, &c., and an increase of trade (and consequently of profits) in spite of a reduc- tion of hours by ten per week. In 1897, however, and subsequent years, the firm reported that their anticipations had not been realised. Any extra zeal evoked during the first two or three years had nearly or entirely died out. Some of the older employees still A'alued it, and showed an increased interest in their work, but this was not the case with some of the more recently engaged men. Many of the employees had come to regard the bonus as deferred pay. The firm there- fore abandoned Profit-sharing, and increased the wages of the "old and worthy hands." Messrs. Peto Brothers, builders, of London, introduced a profit- sharing scheme in December, 1889, in connection with a contract they had undertaken for the extension of Cane Hill Asylum. They offered the men employed on the job one quarter of the whole net profits on the contract; and announced that, if the experiment proved successful, they intended, as far as possible, to adopt Profit-sharing in all future works. The scheme was strongly opposed by the Trade Unions con- cerned, on the grounds (inter alia) that it deprived of participa- tion all who earned less than £b in wages on the contract; also 120 l)KT.\ILKI> IIKI'OFIT. tliose wiio '■ iii(ii\ Iiliiiill y oi in ((niiUiiui t loii do anyl'hiiis;' tending to (liniiiiisli IIh" pioiits on I lie contiatt hy . . . joining' any >tiil\t' tor shorter lioiiis, oi toi- \\;i(l I'utos ot wages on which the twider for the controet was liased, whetlier the strike he general or otherwise. The shares of men so tort ])ai(l in cash, and was in jiroportion to each man's salary. The firm reported that the .scheme had produced good results; it had i)vomoted luirmony and g-ood understanding between them- selves and their employees, and induced greater care and nu)r& attention to the detiuls of the business. They did not, however, find an}- material increase in their returns; and had come to the conclusion that to make remuneration depend directly upon tho efforts of each employe'^ instead of upon the total result, was a far more effectual and mutually l>eneficial method than Profit- sliaring. Commissions to managers, senior hands, and head (Miuiiter-nien, with smiljei' commissions to second and third hands, would, they tliought, produce better results than a scheme which gave a bonus to all meml)ers of tlie staff independently of indi- vidual merit. The scheme was abandoned in 1894, on the conversion of the business into a limited company. The firm have since introduced a new system of commissions, paid at the end of the financial 3'ear at a rate varying with the ])rofits ot the business as a whole, but confined to heads of depart- ments. This s^'stem is still in force. .\/rssrs. .John TIioinn.'<. PROFIT-SHARING AND LABOUR CO- p^f^T II. -'PROFIT-SHARING AND LABOUR CO- PARTNERSHIP IN CO-OPERATIVE SOCIETIES. Introduction. It is of course impossible in this place to trace, even in outline, the general history of the co-operative movement ; all that is here attempted is to indicate very briefly some of the main tendencies of the movement, in so far as they concern the payment of a proflt-^sharing bonus, or the institution of co-partnership, by some of the co-operative societies. An attempt, in short, is made to give so much of the history of the movement as is necesisary to enable an answer to be given to such questions as these: — " How does it come about that a profit-sharing lx)nus is paid by "some co-operative societies and not by others? Are Profit- " sharing and Co-partnership in any sense inherent in the " principles of co-operation; or are they something extraneous, " which may be adopted or not at the pleasure of those having the ** management of the undertaking without anj- sacrifice of co- -operative principle?" Although numerous experiments in co-operation were made in the early years of the nineteenth century — one such experiment, indeed, the Hull Anti-Mill Society's corn mill, actually dating from 1797 — most of these early ventures were failures; and for practical i)urposes the year 1844, when the Rochdale Equitable Pioneers' Society opened their store, may be regarded as mark- ing the beginning of the co-operative movement in this country. The distinguishing feature of the British co-operative move- ment, as it has in practice developed in the three-quarters of a century since that date, is the great predominance of the retail distributive store. Not only the distribution but also the greater part of the production carried on by co-operative societies in this country is carried on either directly by the retail distributive societies themselves or by federations of such societies, notably by the two great wholesale societies, one in England and one in Scotland. The producing societies (or de^jartments) so formed are entirely subsidiary to the retail distributive societies, and are carried on with the same ideals and on the same principles as they:_ in jiarticular, they adopt the plan followed by the retail societies of distributing Iheir profits, or Ihe greater part of them, in the form of a " dividend " to customers, in proportion to their purchases. In other words, they look primarily to the interest of the consumer. This, however, was not the only motive that actuated those in- terested in the movement, even those identified with what has come to be distinguished as the distributive side of the move- ment, or "consumers' co-operation." Thus, the programme of PARTNERSHIP IN CO-OPERATIVE SOCIETIES. 123 the Rochdale Pioneers included a great variety of objects, as follows : — 1. The establishment of a store for the sale of provisions, clothing-, &c. 2. The building, i^urchasing, or erecting a number of homes in which those members desiring to assist each other in improving their domestic and social conditions may reside. 3. To commence the manufacture of such articles as the Society may determine upon, for the employment of such members as may be without employment, or who may be suffering in consequence of repeated reduc- tions in their wages. 4. As a further benefit and security to the members of this Society, the Society shall purchase or rent an estate or estates of land, which shall be cultivated by the members who shall be out of employment, or Avhose labour may be badly remunerated. 5. That, as soon as practicable, this Society shall proceed to arrange the power of production, distribution, education and government, or in other words, to establish a se'lf-isupporting home colony of united interests, and assist other societies to establish Siuoh colonies. 6. That, for the promotion of sobriety, a temperance hotel be opened in one of the Society's houses as soon as convenient. It will be seen that what may be called, for the sake of dis- tinction, " Producers' Co-operation," i.e., co-operative produc- tion primarily in the interests of the producers, took a prominent place among the objects which the Pioneers set before them. This motive was prominent in the discussions that took place, and in the experiments that were tried, during the half century preceding the opening of the Pioneers' store at Rochdale; and it was powerfully reinforced by the rise of the " Christian Socialists," whose ideal was the self-governing workshop, owned and managed by the workers themselves. The origin of this movement is thus described by a writer in the " Economic Journal " for March, 1902: — " About 1849, a group of young University men, working " with the Rev. Frederick Denison Maurice in London, " under the name of ' Christian Socialists,' commenced ari. " active propaganda in favour of a novel form of co^opers- " tion, to be carried on, not in the interest of the working "classes in general with the object of ultimately forminy: " self-supporting communities, as advocated by the co- " operators of twenty years earlier, nor in the interests of " the consumers, as were the societies based upon the lines " of the Rochdale and Leeds societies, but in the interest-s "of the workers employed by the societies, it being pro- " posed that these workmen should own the capital, manage " the business, and divide among them the profits." 24335 E 2 121 PROFIT-SHARING AND LABOUR CO- Thc proiuoler- ol tliis new nioveiuent foraied a propagandist body, culled the " Society- ior Promoting Working Men's Asso- ciations," which set forth the following as their objects: — *' (i) To extend the principles and practice of associated labour. " (ii) 'J'o enable the associates and their families to receive (ill the net profits arising from tlieir lal)Our, after they shroducti^-)e association. " side of the movement, on the other hand, Profit- S'haring is holding its grouiid fairly well. It may be desiralble to point out that Profit-sharing in co- operative societies is not quite on the same footing as Profit- sharing in other undertakings. The " profits "of co-operative societies, as is well known, are not, in general, liable to Income Tax, for the reason that they are not income in the ordinary sense. They represent simply the dilference between the price at which a body of people buy goods, or the cost at which they produce them, and the price at which they re-sell them to them- selves. It is, therefore, only a matter of convenience and of policy whether the " dividend " (as the shared-out difference between the buying and the selling price is called) shall be large or small; some societies prefer to charge relatively high prices, and get their money back in the form of a large " dividend;" while others prefer to reduce prices to the lowest possible level, thus getting the whole of the benefit in low prices, and little or none in "dividend." The ultimate result in either case is the same; and in a co-operative undertaking there is, generally speaking, no one corresponding to the proprietor of an ordinary business, whose remuneration depends on the profits. It has not therefore been deemed necessary to apply precisely the same tests to schemes of Profit-sharing in co-operative societies as to those in ordinary capitalistic businesses ; and it is probable that some of the schemes included in this part of the 24335 E 3 12(5 PROFIT-SHARING AND LABOUR CO- Report wuuld not ho n>yanlt'd as Piofit-sliaiingjn the strict sense, if the tesis ai)plie(l to ordinary businesses were rigx^roiisly applied. For exanijde, a hu-g<' inunber of societies i^rovide that the fund out of which the i)i<)fit-shariiin- distribution is to be made is to consist of an approjtriation out of profits of not less than a farthintee also Labour Gazette for August, 1918, pp. 304 and 305. PARTNERSHIP IN CO-OPERATIVE SOCIETIES. 127 INDUSTRIAL CO-OPERATIVE SOCIETIES. (1) Associatio:ns of Consumers. (rt) Retail Distributive (Store) Societies. Projit-sharin(j with Employees. The number of the Co-operative Retail Distributive (Store) Societies at the end of 1918 was 1,384, of which only 103, or approximately 7^ per cent., gave any share in profits to their employees. In regard toi those Store Societies which have given a share in their profits to their employees, the addition made to the remuneration of the employees by the bonus on wages which they have received is shown in the Table below : — Ratio of Bonus to Wages in Profit-sharing Retail Distri- butive (Store) Societies, 1911-1918. {Compiled from Returns Tnade to the Co-operative Union, to the Ministry of Labour, and to the Chief Registrar of Friendly Societies.) Number of Profit-sharing Ratio of Bonus to Wages . Number of Employees at end of year. and Salaries. Societies sharing Year. Profits at Dii5tribu- Pro- Distribu- Pro- Both eud of tive ductive Total. tive ductive Depart- year.* Depart- Depart- Depart- Depart- ments ments. ments. ments. ments. together. Average of Per cent. Per cent. Per cent. 1901-10 220 13,212 2,506 15,718 5-1 5-0 5-1 1911 ... 192 14,410 3,086 17,496 4 4 4-5 4-4 1912 ... 185 13,816 3,029 16,845 4 4 4-5 4-4 1913 ... 179 14,324 3,107 17,431 4 4 4-5 4-4 1914 ... 176 14,761 3,225 17,986 4 5 4-6 4-5 1915 ... 167 15,866 3,270 111,136 4 3 4-3 4-3 1916 ... 142 14,629 3,272 17,901 4 6 4-4 4-6 1917 ... 137 15,255 3,103 18,358 4 3-7 3-9 19l8t ... 103 14,428 3,150 17,578 4-0 3-4 3-8 Note.— A Society is not included in the Table for any year in which it did not allot a sum to employees. * Most of these Societies share profits both with the distributive and with the productive employees, but a few Societies in each year share profits with productive employees only. t The figures for 1918 are provisional, and subject to correction. It will be seen that the number of " Store " Societies practising Profit-sharing has steadily and (especially since the war) rapidly declined, the number in 1918 being only 103, as compared witli an average of 220 in the ten-year period 1901-10. Owing to the growth of the individual Societies, however, the total number of employees in receipt of a profit-sharing bonus has remained almost unchanged. 24335 ^ * 12,^ PROFIT-SHARING AND LABOUR CO- The ratio of bonus to wages also shows a decline as compared with tJie average of the ten years 1901-10. It was then almost exactly 5 per cent.; for the next six years (1911-16) it stood at ahout 4i per cent., with very little variation; but during 1917 and 1918 it has sunk to 4 per cent., or even less. Shareholding by Employees. The membership of Retail Distributive Societies, as of Co- operative Societies of every type, is invariably open, subject to election by the Committee of Management, so that there is no difficulty in the emploj'ees becoming shareholders, and it is believed that in most cases they do so. In regard to the extent of the control capable of being exercised by the employees at meetings of the shareholders, it must be borne in mind that the rule in these Societies is one member one vote, irrespective of the number of shares held by each. x\s to their direct influence upon the proceedings of the Committee of Management, it may be stated that it is very unlikely that in any appreciable number of cases employees of a Store Society would be fo'und to have seats on its Committee. • (&) Wholesale Societies. Profit-sharing with Employees. The English Co-operative Wholesale Society, which at the end /oi 1918 employed 3,796 persons in its distributive and 17,366 in dts manufacturing departments,* does not now share profits with its employees. ' On tiiis Society deciding in 1873 to establish its own workshops /{for production, the members, upon the recommendation of the Committee, adopted a scheme under which a bonus was to be paid to the employees based partly upon the profits made by the Society and partly upon an increase in sales. When the dividend upon purchases paid to members reached 2d. in the £, the employees were to receive a bonus of 2 per cent, upon their wages, and an additional ^ per cent, for each increase of ^d. in the £ in the dividend upon poircliases, until the bonus upon wages reached a maximum of 4 per cent. In addition, when the sales of the Society for the year averaged £2 per quarter per head of the total membership of the shareholding societies, a further bonus of 1 per cent, upon wages was to be paid, with an additional h per cent, for each increase of 25. 66?. per head in the average sales up to a maximum of 3 per cent, upon wages. This arrangement applied to all employees of the Society, whether engaged in its productive or its distributive departments. v/ In 1876 the Committee of the vSociety reported that the bonus ' system had not given satisfaction, and recommended its dis- ^ • The English Wholesale Society carries on the following industries : — Building, / the manufacture of textiles, boots and shoes, and other clothing, printing and bookbinding, woodworking, furnishing and brushmaking, the manufacture of soap, candles, starch, margarine, etc., flour milling, the manufacture of biscuits, sweets, preserves, pickles, and other food, and of tobacco, as well as farming and dairying, and coalmining. PAETNERSHIP IN CO-OPERATIVE SOCIETIES. 129 continuance, this course being adopted at a general meeting oi delegates by 150 votes to 78. In 1882 the Committee introduced into certain departments a system under which a bonus was to be paid based upon an increase in sales and a decrease in expens.es, subject to a certain minimum of profit being shown on the working of the depart- / ment. This was extended to a larger number of employees during 1885 ; but in 1886 the Committee again reported adversely upon the scheme, with the result that it was abandoned, and no further steps have been taken as regards Profit-sharing with employees. The Scottish Co-operative Wholesale Societ}-, which carries on similar undertakings to the English Society, adopted Profit- A sharing in 1870. The scheme then adopted provided that its employees (all of whom were at that time employed in dis- tribution) should receive a bonus on their wages at double the rate of dividend paid to members on pui'chases. In 1883 the Society commenced piX)duction, and in 1884 the old arrangement as to bonus was replaced by a new scheme which established a differential rate between workers in the distributive and in the productive departments. Under this, the distributive employees received a bonus at the same rate as the rate of dividend on members' purchases ; while the rate of bonus to productive workers was determined by the net aggregate profit made in the manufacturing departments only. This arrangement was again revised in 1892, when the Society decided to pay to all its employees, whether employed in its distributive or its productive departments, a bonus on wages at the same rate as the dividend on purchases paid to members: it was required, however, that one-half of each worker's bonus should be retained and placed to his credit in a special fund, called the Bonus Loan Fund, which received interest at the rate of 4 per cent, per annum. Except with the consent of the Committee, deposits in this Eund were only withdrawable after the^ expiration of three months from the date of the employee leaving the service of the Society. The scheme was brought to an end in 1915, under the following circumstances. A motion for the cancellation of the _ rule regarding the payment of a bonus on wages to the Society's employees was submitted at the quarterly general meeting of the Society in September, 1914, and agreed to ; and the cancellation was confirmed at the next general meeting in December of the same year by the necessary two-thirds majority. The ameiulerl rule was duly registered, and payment of the bonus discontinued in the February following. At a subseqiient general meeting, however, it was decided to continue a payment at the rate of 8^. in the £ on wages (the rate at which the bonus had normally been paid) to the workers who had been in the employment of the Society at the date of the withdrawal of the scheme, by way of compensation. i:{() PROFIT-SHARING AND LABOUR CO- Tlie rt'asoiis given f(ji- tin; withdrawiil of the scheme are as follows : — ■' Hrii'lly the jiiineipal poiiil.s adilueed ill llio een in existcnc>e for fifty yeaas, and tlie total amount of the bonuses that have been distributed to the employees is now over £103,811. It is only within the last 27 years, however, that employees have been able to invest their surpluses, Ihroup-h the Bonus Investment Society, in the Bakery. There is a tacit understanding: that employees sball invest at least a ijuarter of their bonus in the shares of the Bakery, and this is almost exactly the proi)ortion which has, in fact, been so invested by the employees, on the average, during the 'last two years. (2) Productive Associations of Workers. Unlike tbe Societies dealt with in the previous section ,. which.' are formed and managed primarily in the interests of consumers, the productive associations of w^orkers are formed and managed primarily in the interests of the persons employed. They are in tJie main an attempt by the workers in vai-ious industries to substitnte for the ordinary^ conditions of employment by an individual capitalist or a Joint Stock Company a system under which the members of tbe Societies work in a. factory or work- shop either rented by, or belonging wholly or in part to, them- selves, under conditions of labour decided upon by the members, and carried out under the direction of a manager and committee elected by them, the profits of the undertaking being distributed as the members, in g-eneral meeting assembled, may decide. In 1918 there were 76 associations of this general character at work in the United Kingdom. Four of these Avere of a special type known as '' Home Industries " Societies, all in Ireland; none of which allotted any sum as bonus to their employees out of profits. As they are somewhat different in character from the other " Productive Associations of Workers," they are omitted from the following- tables. There h.as been a great decline in the number of these Societies since the issue of the last Profit-sharing Eeport in 1912. In the interval, six Societies of this type have been both, registered and dissolved, and six others, which are still in existence, liave been registered. On the other hand, in addition to the six Societies which have been both, registered and dissolved in the interval, three Societies have been absorbed by the (English) Co-operative Wholesale Society,, and no fewer than twenty-three otbers h.ave been dissolved. The decline in the number of tbese Societies has, in fact, been almost continuous since the year 1904, when the number stood at 125. Those now remaining, however, are often the larger and more prosperous and well-establivSihed Societies, so that the number of employees remains at nearly a uniform level; while the sales and profits of these Societies, especially during the war, show very large increases. The increase in sales is no doubt largely due to the general rise in prices. PARTNERSHIP IN CO-OPERATIVE SOCIETIES 1:^3 The principal statistics of the 72 Societies of this group remain- ing in existence in 1918 (omitting the four " Home Industries " Societies) are as follows : — Productive Associations of Workers — Summary 13y Industries, 1918. (Compiled from Returns made to the Ministry of Labour and to the Chief Registrar of Friendly Societies.) So- Membership. Capital, cieties at end of year. Sales. Industries. 1 Indi- 1 So- viduals.icieties. 1 Share. Loan, Reserve and In- surance. Profit.* & & £ £ Building I -to — 547 406 76 828 72 Metal, Engineer- 6 709 124 17,090 4,501 17,502 110,284 8,192 ing, etc. Textile 10 9.284 1,235 184,953 182,355 39,185 1,085,068 59,860 Boot and Shoe 19 4,275 1,141 109,593 115,184 100,496 1,111,-522 96,380 Other Clothing •1 2,479 892 69,820 4.5,551 48,045 643,780 68,161 Printing and 19 2,866 525 81,850 33,042 32,715 451,953 51,871 Allied Trades. 1 "Woodworking 6 289 139 21,856 49,785 3,449 52,280 ; 1,986 and Furnish- 1 ing. Food Prepara- 2 427 541 45,375 28,008 9,881 204,352 13,330 tion. Bassdressing, 1 64 — 227 591 2,707 12,134 2,,591 Mat and 1 Brushmaking. i Leather 1 14 I 209 201 480 4,012 715 Miscellaneous... 3 1,034 1 5,514 5,974 2,247-\ 5,835 638 Total ... 72 21,481 4,599 537,034 465,598 252,289 3,682,003 303,796 * The amounts in this column are the amounts of the profits before dividend on the share capital has been paid. t Deficit. It will be seen that- the trades in which Societies of this type are most in evidence are the boot and shoe and other clothing trades, the textile trades, and the printing and allied trades. Profits and Profit-Sharing. In these Societies the profits realised are devoted in the first instance to paying a fixed rate Oif interest (frequently 5 per cent.) on the shares ; out of the balance sums are usually added to Ke- serve Funds, including Accident, Compensation and In- surance Funds; a dividend on purchases is in many cases paid to the customers of the Society ; capital in some cases gets a further share in profits over and above the fixed rate of interest; and a portion of the profits, varying in different cases, is usually allotted toi the employees in the shape of a bonus upon the wages earned by them, this bonus being wholly or in part capitalised as shares in the Society, entitling the holders to participate in the manage- ment of the concern : in addition, in a considerable number of 134 PROFIT-SHARING AND LABOUR CO- S(K-iotios, amounts are allotted out of profits to Provident Funds f(»r the luMiefil of tiuMr employees. Tlie goods ju-oduced by these Societies are in the main sold to retail Distributive Societies, which frequently provide a considerable portion of the capital emi)loyed, and which share in the manaoement by means of delct-atos elected to the management committees of the Societies. The number of the Workers' Productive Societies which in the years 1911-18 shared profits with their employees, the number of their eiuployees participating in profits, the ratio of bonus to wages, and the amounts allotted out of profits to Provident Funds for the benefit of employees, are shown in the Table which follows : — Profit-Sharing by Productive Associations of Workers, 1911-1918. {Compiled from Returns made to the Co-operative Union, to the Ministry of Labour, and to the Chief Registrar of FHendly Societies.) Year. All Societies together. Societies which shared Profltg with their Employees No. of Societies at end of year. No. of Em- ployees at end of year. No. of Societies* which paid Bonus on Wages in year. No. of S^o. of Em- Katio of Societies*! ployees Bonus to which receiving Wages of allotted ! Bonus on Partici- Sums to Wages in pants in Provident year. year. Funds in year. Amount allotted to Provident Funds in year. Average of 1901-10 1911 ... 1912 ... 19i:^ 1914 ... 1915 ... 1916 ... 1917 ... 1918 ... 100 89 85 85 85 78 77 74 72 6,756 7,190 7,631 7,917 8,002 7,826 7,590 7,316 7,139 41 41 41 40 37 36 40 42 44 4,453 5,014 5,988 5.851 6,120 6,277 6,039 5,906 5.831 3r cent. 4-4 20 5-1 23 4-9 24 5-2 27 5-5 27 7-6 25 8-0 29 7-4 31 8-2 32 £ 1,437 3,326 3,950 4,992 4,045 5,242 5,649 6,513 8,484 • Some of these Societies paid bonus on wages and also allotted sums to Provident Funds ; this was the case with 26 Societies in 1918. It will be seen that, though the total number of Productive Associations has steadily declined, the number of Associations practising Profit-sharing has been maintained at a nearly uniform level ; it was, indeed, higher in 1918 than in any previous year since 1908. Forty-four of the 72 Societies included in the Table allotted a share in their profits to their employees in 1918 : 18 of the^se paid a bonus on wages only, and 26 both paid a bonus on wages and also allotted sums to Provident Funds for the benefit of their employees. Six other Societies credited the whole of the <'mplo\-ees' share in profits to Provident Funds. PARTNERSHIP IN CO-OPERATIVE SOCIETIES. 135 Share of Employees in Membership, Capital and Control. The extent to which the employees share in the membership, .capital and control of these Productive Associations of Workers, is shown in the four Tables which follow : — Productive Associations of Workehs — Share of Employees, OTHER Individuals, anb Societies, in the Membership, 1911-1918. {Compiled from Returns tnade to the Ministry of Labour. ) Tear. Kumber of Societies to which the particulars relate. Average of 1901-10. 1911 1912 1913 1914 1915 1916 1917 1918 89 77 76 76 78 71 72 69 67 Membership. Employees. No. 3,502 3,852 3,964 4,365 4,679 4,655 4,696 4,819 4,826 Per- centage. 19-0 Other Individuals. No. Per- centage. Societies. No. Per- centage. Total Mt-mber- sUip. 11,352 61-6 3,556 3,537 3,355 3,546 3,897 3,902 4,277 4,576 4,534 11,627 61 1 11,755 61 6 12,183 60 6 13,536 61 2 14,143 62 3 15,132 62 8 15,884 62 8 16,459 63 7 19-4 18,410 19,016 19,074 20,094 22,112 22,700 24,105 25,279 25,819 It will be seen that the propoi-tion of employees to the total membership was apparently on the increase up to the outbreak of war. The slight decline since then may presumably be attributed in part to the war. It should also be noted that, though the apparent voting strength of the employees was less than 20 per cent., their actual voting strength is really greater than appears, ^ since proxy voting is rarely allowed, and employees are more likely to be on the spot than the " other individuals." Productive Associations op Workers — Number aisd Propor- TiON OF Employees who were and who were not Members, 1911-1918. (Compiled from Returns m.ade to the Ministry of Labour.) Year. Number of Societies to which the particulars relate. Employees who were Members. Number. Percent- age. Employees who were not Members. Number. Average of 1901-10. 1911 1912 1913 1914 1915 1916 1917 1918 77 76 76 78 71 72 69 67 3,502 3,852 3,964 4,365 4,G79 4,655 4,696 4,819 4,826 55-4 56-9 59-2 62-2 61-0 61-5 62-6 66-4 68-2 2,815 2,918 2,737 2,654 2,986 2,914 2,805 2,435 2,249 Percent- age. 44- 6 43 1 40 8 37 8 39 38 5 37 4 33 6 31 8 Total Employees. 6,317 6,770 •6,701 7,019 7,665 7,569 7,501 7,254 7,075 \:u] PROFIT-SHARING AND LABOUR CO- It will be seen that the proportion of employees who are members shows a marked increase, especially in the last two years, and exceeded 68 per cent, in 1918. Productivk Associations of Wokkeus — Share of Employees, OTHER Individual Members, Societies, and non-Members IN Share and Loan Capital, 1911-1918. {Compiled from. Retttrns made to the Ministry of Labour.) Capital held by No. of Societies to which the Other Non- Employees. individual Societies. Members Year. Members. (Loans).* Total share particu- lars and loan capital. Per- Per- Per- Per- Amount. cent- Amount. cent- Amount. cent- Amount. cent- age. age. age. age. Average £ +• £ £ £ of 1901-10 89 74,695 12-2 219,391 35-9 257,659 42-1 59,894 9-8 611,639 1911 ... 77 87,886 13-9 219,616 34-7 271,057 42-9 53,767 8-5 632,326 1912 ... 76 91,819 15-1 222,774 35-5 250,7(18 ;j9 • it 59,869 9-5 628,230 1913 ... 76 96,106 14-2 242,101 35-8 276,085 40-9 61,740 9-1 676,032 1914 ... 78 109.331 14-7 264,548 35-5 310,680 41-7 60.354 8-1 744,963 1915 ... 71 123,952 16-1 284,614 37-0 302,727 39-3 58,749 7-6 770,042 ]91t; ... 72 141,129 16-9 310,615 .37-2 315,607 37-8 67.143 8-1 834,494 1917 ... 69 157,124 17-7 340,505 38-3 321,597 36 • 1 70.613 7-9 889,839 1918 ... 67 175,729 18-3 371,376 38-4 341,464 35-3 78,637 8-1 967,206 * Including Bank overdrafts. Productive Associaiions of Workers — Proportion of Members of Committees ov Management who were respectively Employees, oiher Individual Members, xtstd Representatives of Societies, J 911-1918. {Compiled, from Returns made to the Ministry of Labour.) Number of Societies to which the particulars relate. Numbe r and Proportion of Committee-men who were Year. Employees. Other Individual Members. Representatives of Societies. Total Com- mittee- No. Per- centage. No, Per- centage. No ' '^^^■ ^ °- centage. men. Averaoje of 89 309 38-9 342 43-0 144 18-1 795 1901-10, 1011 77 263 38-0 284 41-0 145 21-0 692 l')12 76 267 40-0 283 42 4 118 17-6 668 1913 76 265 39-8 287 43 1 114 17-1 666 1914 78 272 .38-4 288 40 7 148 20-9 708 1915 71 257 39-3 263 40 3 133 20-4 653 191G 72 265 39-6 267 39 9 137 20-5 669 1917 69 274 41-5 255 38 6 131 19-9 660 1918 67 275 43-3 240 37-8 120 18-9 635 PARTNEBSHIP IN CO-OPERATIVE SOCIETIES. 137 The two preceding- Tables sliow a very marked increase in the employees' capital holdings, which exactly doubled between 1911 and 1918 : this was accompanied by a considerable increase in the proportion of the total capital held by employees, and in the percentage of employees who were members of the committees of management. There is, however, a great variation in the practice of the several Societies in regard to the admission of employees on the managing committees. The returns received give the following results : — In IT Societies, with 31' 5 per cent, of the total sales of the 67 Societies, the employees were not rei)resented on the managing committees at all ; In 27 Societies, with 25" 8 per cent, of the sales, some of the committee-men, but not a majority, were employees ; In 23 Societies, with 42' 7 per cent, of the total sales, employees form.ed the majority of the managing committees : IG* of these Societies were engagied in the manufacture of boots and shoes. It may be of interest to give, as an example of one of the more successful of these Productive Associations of Workers, a detailed account of one of them, viz. : the Co-oPEEATivE Printing Society, Limited. The Society was established in 1869, by a small group of work- ing men, chiefly operative printers and co-operators; and its first Committee consisted of representative co-operators and trade unionists engaged in the printing industry. The business was at first confined to Manchester, but grew very rapidly; and within three years from the starting of the business it was decided to erect printing works in Manchester for the Society's own use, and to establish a branch in Newcastle. A few years later (1875) it was decided to alter the name of the Society from *' The North of England Co-operative Printing Society, Ltd.," to its present title. The London Branch was opened in 1886; and the Society decided to erect new printing works in Newcastle and in London in 1892 and 1893 respectively. In 1875 the Society had pur- chased the premises it occupied at Highbridge, Newcastle-on- Tyne. For some years after 1874 the Society passed through a time of some difficulty, partly owing to bad management, and partly owing to the general industrial depression of 1879; but ivom. 1884 to the present time, and particularly during the last fifteen or sixteen years, the Society has been very prosperous. The Society has from the first had the support of the Trade Unions and the Co-operative Societies, both as shareholders and as customers; in fact it has ccmparatively little custom outside i;^,S PROFIT-SHARING AND LABOUR CO- these botlies. A I 11h> present time, Trade Unions and Co-opera- tive Societies are the largest shareholders, the others being employees and other fo-o])erators, many of whom have succeeded to the shares held hy the founders of the Society. The Society adopted the system of sharing profits with its emi)l(iyees from the outset. At first the bonus was calculated as follows: interest on loans was paid at a rate not exceeding six per cent.; then a dividend at the rate of "seven per cent.; and the remaining net profits, if ony, were divided equally be- tween the shareholders and the employees in such a way that the shareholders received a supplementary dividend on the amount of their shares, and the employees a bonus of equal amount on their wages or salaries. For example, in the second half-year of the Society's working, when the total dividend to shareholders was ten per cent (i.e., fixed dividend of seven per cent., j)lus supplementary dividend of three per cent.), the em- ployees received a bonus equal in total amount to the three per cent, upon the paid-up share capital. In 1872 the basis of distribution was altered, the alteration becoming operative in 1873. The rate of dividend to share- holders was raised to 7^ per cent., and the remaining net profits were divided into three equal parts, apportioned to the share- holders, to the emploj-ees, and to customers, respectively. In 1891, however, the Society adopted a new method, and since that date has paid the same rate of dividend on wages, on purchases, and on capital. In 1893, the fixed rate of dividend on capital was reduced to five per cent, (the rate now generally adopted by Co-operative Societies of all descriptions), which,, of course, considerably increases the amount falling due to the employees as bonus. Tlie Society had about 550 employees at 'the 31st December, 1918. During the Mix years of its existence it has distributed £29,040 in bonus among its employees; for the last ten years (1909-1918 inclu^ivei the bonus has averaged over three per cent. on wages. Employees are not obliged to invest any of their bonuses in the Society's shares, but many of them are in fact shareholders. The amount invested by employees in the Society's shares would no doubt be larger but for (i) the limit of ten on tlie number of shares allotted to employees, and (ii) the unusually favourable terms allowed to employees who leave their bonuses in the Society's Thrift Fund. The Society adds 10s. to every £1 paid in by the depositor, and pays 5 per cent, interest both on the employees' deposits and on its own additions thereto. Depositors can with- draw the amount standing at their credit on leaving the Society. If they leave before the end of five years thej^ receive their own contributions only ; if they leave after serving five years, but less than ten years, they receive their own and one-half of the PARTNERSHIP IN CO-OPERATIVE SOCIETIES. 189 Society's contributions; and if tliey have served ten years tliey receive all the Society's contributions as well as their own. Special provision is made for females, who can withdraw all the amount standing- to their credit if they leave after serving seven years. The Society has always made good conditions for its workers one of its guiding principles. It was the pioneer in the printing- trade in the United Kingdom, first of the 52-hours and after- wards of the 48-hours week ; the 48-hours week has been in force in the Society's works for eighteen years past. All the em- ployees g'et at least the Trade Union minimum rate of wages ; the great majority get something over the minimum. By way of celebrating the jubilee of the Society a Pension Fund has been established. The fund was started with a sum of £11,000 transferred from the Society's Benevolent Fund, to which a further sum of £5,000 was added, as a direct contribu- tion from the Society itself, at the shareholders' meeting held in November, 1919. It is proposed to make a contribution every half-year, should the profits permit, at the rate of £2,000 per annum, or such other sum as may be voted by the shareholders' meeting; but the Society are not to be bound to make any such contribution. The funds are to be invested in trustee invest- ments, and not in the Society's business. Employees may retire at the age of 61, with the consent of the directors; and must retire at 65, except with such consent. The proposed rate of pension is to be one-third of the emploj'ee's average earnings during the last five years of employment in the case of those who have served for at least 40 years; with pro- portionately smaller amounts for those who have served for 30 but less than 40' years. The pension may be reduced by the directors if a national pension scheme is introduced under which the employees could claim benefits ; and no pension is to be granted if the funds are insufficient. Pensions may also be withheld, in ceaiain cases, at the discretion of the directors. On the other hand, the directors have power, in special circum- stances, to increase the pension which would be payable under the strict rules of the scheme. AGRICULTURAL CO-OPERATIYE SOCIETIES. Productive Societies. The number of Agricultural Productive* Societies in existence at the end of each of +he years 1911-16,1 the number of these Societies which in these years shared profits with their employees, the number of the employees of these Societies, and * Profit-sharing is also carried on by some agricultural distributive societies, but only to a very small extent ; and it has not been thought necessary to give particulars of the distributive societies in this Report. t Particulars regarding the agricultural co-operative societies cannot be given for a later date than 1916. 110 rilol'lT-SlIAKING, &C., IN CO-OPERATIVE SOCIETIES. the ratio which the bonus received by them bore lo their wages, uie shown in the Table which follows: — Pi{(>irr-siiAi;iNt; 1!V AliHICULTURAL PRODUCTIVE SOCIETIES, 1911-1916.* {('ornptlcd from Returns made to the Ministry of Labour^ to the Chief Registrar of Friendly Societies, and to the Irish Agriculiaral Organisation Society.) Total Number of all Societies at end of Year. Societies •which ihared Profits with their Employees. Year. Number of Fm'Slm'eei I'*"" "^ ^o°"« Societies rS;e vinf »« "^^^^K^^ °^ which paid BonuVon Partioipants Bonus in Year, wagcs in year. '" Y^^^' Average of 1901-10 ... 1911 1912 1913 1914 1915 1916 261 338 352 368 383 389 387 29 51 55 67 61 67 79 181 372 316 432 4.35 488 484 4-5 5-6 6-6 5-4 5-6 6-3 8-2 It will be seen that, taking all the Societies comprised in this group together, the element of Profit-sharing with employees has not, so far, played a very important part in the organisation of the Agricultural Productive Societies, as only slightly over 20 per cent, of the Societies share any of their profits with their employees. This proportion, however, is higher than in any previous year, and compares with an average of 11 per cent, in the ten years 1901-10. The number of employees receiving bonus, and the ratio of bonus to wages, also show an increasing tendencj', the ratio in 1916 being 82 per cent., or nearh^ double that of the average of 1901-10. Among these Societies the principal group is formed by the Irish Dairying Societies, 318 in number in 1916, with aggregate sales of £4,713,439, or 84"3 i)or cent, of the total sales of the whole of the Agricultural Productive Societies in the United Kingdom. The profits made by these 318 Irish Societies in 1916 amounted to £71,073, out of which £1,580 in all was paid by 68 Societies to their employees as bonus on wages, to which it made an average addition of 7"6 per cent. With respect to shareholding by employees, the rules of the Irish Agricultural Productive Societies provide that the share in profits falling to the employees shall be accumulated as shares in the Sofieties; and in those cases in which a share in profits has been paid to the employees, it may be presumed that there are a certain number of employee-shareholders. In Great Britain, on Ihe other hand, the bonus is paid in cash; and, both in Ireland and in Great Britain, it does not appear that in any considerable number * Particulars regarding the agricultural co-operative societies cannot be given for a later date than 1916. CONVERSION OF ORDINARY BUSINESS INTO 141 CO-OPERATIVE SOCIETIES. of cases employees are members of the Society by which they are ■employed, nor that the employees are, to any very appreciable extent, represented on the Committees of Management of these Agricultural Productive Societies. CONVERSION or OEDINARY BUSINESSES INTO CO-OPERATIVE SOCIETIES. In the great majority of cases the industrial Co-operative Societies are undertakings initiated, and from their commence- ment owned and managed, mainly or entirely, by working-men. But in a few cases undertakings originally established by em- ployers in the ordinary way have, by the admission of the work- people employed to a very extensive share in the profit, capital, control, and responsibility, and by the adoption of co-operative principles of organisation, been converted into Co-operative Societies. A short account of three cases in which a change of industrial organisation of this nature has taken place will be of interest in connection with the subjects dealt with in the present Report. WiUiavi Thomson and Sons, Ltd. The best known example is that of the business of woollen and worsted manufacturers carried on under the name of William Thomson and Sons, Limited, at Woodhouse Mills, Huddersfield. The owner of this concern, Mr. George Thomson, turned it, in October, 1886, into a society, which was registered under the Industrial and Provident Societies Acts, The property was taken over from the firm by the new society at a valuation of £19,713, including £10,628, value of raw materials and unfinished and finished stock, £4,226, book debts, and £4,859, value of machinery and fixtures. It was paid for partly in shares but mainly in loan stock, carrying 5 per cent, interest and repayable only if such interest should not be paid for two consecutive years. After providing for interest on loans and for depreciation (at the annual rate of 10 per cent, for fixtures and 2^ per cent, for buildings), the rules of the society provide* that the dividend on the shares shall be limited to 5 jjer cent. ; but if at any time the profits of the business do not allow of such dividend being paid in full, the deficit (but without interest) is a first charge on the subsequent profits. Out of the balance remaining after satisfying the claims of the shareholders the rules require that not less than 10 per cent. «hall be carried to reserve, until this fund amounts to 10 per cent, of the capital. * The Rules are stated in their present form. The provisions in regard to ihe Assurance and Pension Fund were inserted (with consequential amendments of the other provisions with respect to the division of profits) in 1892. X42 CONVERSION Ol' ORDINARY BUSINESSES The Coininittoo may, if thoy Uiink fit, devote a iKJitiun ol'.the ]>nitit.s to a I Mild to be called the Assurance aud Pension Fund aj^iiinsl sickness, accident and iiifiiiiiity , in which ca»e the l<>no\vin<^ scale shall apply : — (1) Whenever the net profits realised in any year are etiual to 5 per cent, of the wages paid during that period, a -uni equal to 1 per cent, of such wages. (2) For every sum by which such profits are 2i per cent. nioiv than such 5 per cent., an additional sum equal to 1 jxr cent, of such wages; but &() that the total amount thus applied shall not exceed 5 per cent, of the wages paid during- such jieriod. The remaining- net profits are to he divided into two equal pai-ts, one-half to go to the employees of the society as a bonus on wages and the other half to the customers of the society as a dividend on purcluises.* The share thus allotted to the employees is to be paid, not in cash, but in shares or payments on account of shares in the society. ]iy the rules Mr. Thomson was aj)]M)inted to be general manager of the society during his life, but owing to ill-health and increasing- years he resigned the jiosition on 30th Sejitember, 1917. He nominated Mr. F. C. Langley (who had been employed by the firm for 26 years) as his successor, and the appointment was confirmed by a special general meeting of the shareholders. Under the special rules of the society it is declared that the general manager shall " control all business carried on by the " society, and engage, remove, or discharge all assistant " managers, salesmen, or employees of every description required " to conduct such business, and fix their duties, salaries, or other " remuneration at such rates, and require them to give security " in any form approved by the committee, as he may determine, " subject to the dutj- of regularly reporting all such acts to the " committee." The committee of the society consists at present of the general manager, Mr. Thomson (honorary member), three employees of the society, two representatives of co-operative societies which hold shares in "William Thomson and Sons, Limited, one repre- sentative of the Huddersfield District Fnion of Textile Workers, and the secretary of the General Union of Textile Workers. This committee meets monthly; but those of its members who are employed in the mills act as a sub-committee, meeting as required, and dealing with questions of an urgent nature, such as a break- down of machiners'. The share capital of the societv on the 31st January, 1919, was £15,702: the loan capital, £11,164: resei-ve fund, '£4,861 ; assurance and pension fund, £584. The number of employees was 107. * This dividend on purchases is paid only to the two Co-operative "Wholesale Societies, not to fjeiicral traders, who prefer the usual terms of credit, etc. On account of the arrangements which have l)een made as to co-operative purchases, the exact etjuality between the share of the employees in the " remaining net. profits " prescribed by the rules is subject to certain variations. INTO CO-OPERATIVE SOCIETIES. 148 Out of the total (£15,702) of share capital, £3,995 was held by co-operative societies, trade unions, and friendly societies, and £4,679 by the workers; the remaining- £7,108 being held by indi- viduals, 269 in number, interested in the co-partnership move- ment. Of the loan capital, £4,962 is held by trade unions, co- operative societies, and members of Mr. George Thomson's family. The society has recently had an oijportunity of purchasing- the mills, including- the premises oo(!.ui)ied by the society itself and those occupied by several adjoining- concerns. As the society had for some time felt the need of greater freedom for extensions, it clecided, in July, 1919, to raise £15,000 in 6 per cent, registered ten-year bonds. A special appeal, was made to trade unions, co-operative societies, and other similar institutions to take up bonds. The issue was very quickly taken up, and the purchase of Woodhouse Mills was completed on the 1st August, 1919. The society's sales were at the outset about £22,500 a year, but they have now risen to nearly four times that amount, being £85,368 in 1918. The profits realised have, during- the existence of the society, varied g-reatly in different years, but the share- holders have received their 5 per cent, all through ;* and it is to be noted that on several occasions in years in which the profits did not suffice to pay this rate in full, the employees voluntarily made good the deficiency out of their wages, the sums thus g-iven up by the workpeople to the shareholders amounting in all to £1,400, which was repaid to the workers out of tfte profits of the year 1912. After allowing for this amount, the average net addition which the share in profits (bonus on wages plus sums credited to the assurance and pension fund) allotted to the employees has made to their wages since the society was formed has been equivalent to 6 per cent. With regard to the wages paid by the society, it is to be observed that in 1893 it was decided, at the suggestion of Mr. Thomson, to substitute experimentally for the system of pay- ment by piece-work, usual in the woollen weaving industry, a system of time-wages ;t and at the same time to adopt, instead of the hours worked in the trade (then 56| hours per week), a 48-hour week : time-wage payment with a 48-hour week has been in operation in these mills ever since. The minimum weekly pension allowance is 12^. for men and 8.'?. for women. It is of interest to note that no married women are employed by the society; those w^omen who, upon their marriage, have worked not less than five years with the society being granted out of the assurance and pension fund a sum of £5, and if not less than ten years, £10. * On one occasion 4 per cent, only was paid, l)nt the deficiency of 1 per cent was made up to the shareholders out of profits soon afterwards. t The main objection entertained by the weavers to being paid piece-wages was that they received no remuneration in respect of periods between finishing one job and starting another, this " waiting for warps " causing them consider- able disadvantage. The time-wage rates introduced when piece-work was abolished were based upon average earnings in each department during a fairly good year. 1 1 I CONVERSION OF ORDINARY BUSINESSES^ It would iipjuMi- that the jxysitiou occupied by the workpeople of Win. Tliuinsou and Sons, Limited, is of such a nature that thev identity themselves to a roniarkahlo extent with the interests of tho business. Ti»e veiy considerable sums contributed out of their wages by the workpeojjle in order that the shareholders should not receive less than their usual return of 5 per cent, have already been mentioned. From the point of view of the management, the fact that the worki)eople are directh' interested in the business is found to result in their exhibiting increased application and avoiding waste; it also makes the management much less costly, because, as Mr. Thomson has said, " each man and woman becomes his *' or her own manager." Brownjield' s Guild Pottery Society, Ltd. Another case in which an ordinary business has been turned into a co-operative society is that of Brownfieid's Guild Pottery Society, Limited. Mr. Arthur Brow^nfield, tlie owner of the old-established pottery works of Messrs. William Brownfield and Sons, at Cobridge, in Staffordshire, determined, in consequence of the lock-out which took place in the pottery industry in 1891, but in which his firm was in no way concerned, to place this undertaking upon a new footing by transferring it to a co-operative society, which was registered, under the Indus- trial and Provident Societies Act, in October, 1892, and com- menced to manufacture in January, 1893*. The share in the assets of the late firm which belo'nged to Mr. Arthur Brownfield, the founder of the vsociety, was repre- sented by £6,000 deferred stock, carrying interest at 5 per cent., which was not to confer a right to demand payment of the principal from the society so long as any claim for the payment of the ordinary share capital remained. The capital of the society consisted of £6,690 deferred stock, £T,-5-j1 preferred shares, and £932 loan stock. The £6,690 deferred stock included, in addition to the £6,000 belonging to Mr. Brownfield, £690 belonging to employees of the society. Of the 7,531 pre- ferred shares, £251 belonged to employees of the society, £1,410 to trade unions, £1,760 to working potters employed in other works and to railway servants, £650 to 25 co-operative societies, £23 to employees of co-operative societies, £125 to three cus- tomers of the Guild Pottery Society, £480 to persons who sup- plied the society with raw materials, and £2,832 to the general public. The £932 loan stock consisted, in part, of £200 advanced by two managers of co-operative societies, and £50 advanced by a co-operative society, these loans canying interest at 5 per cent. ; while the balance (£682) was advanced without interest by Mr. Brownfield, this sum including £282, part of his salary of £400 a year remaining unpaid. The total number of persons employed by the society at the start was about 400, of whom 200 (not including Mr. Brownfield") held stock or shares, all the 200 holding deferred stock, while 150 held both deferred stock and preferred shares. The whole of the employees were expected before long to have become owners INTO CO-OPERATIVE SOCIETIES. 145 of at least £1 apiece of deferred stock, as they were taking up this stock by instalments; every week, when the workers were on full time, men paid 5 per cent, on their earnings and women 2^ per cent. It was intended that the holdings of the employees in the deferred stock should be increased until they amounted in the aggregate to £2,000. The rules provided that the net profits, after providing for the interest and dividend upon any loans or deposits or guaranteed preferential shares, should be applied in reduction of the fixed stock and plant at specified rates, and in the reduction of any preliminary expenses : thereafter share capital was to receive a dividend of 6 per cent. ; not less than 10 per c«nt. of the profits Avas to be carried to reserve until this fund amounted to 10 per cent, of the capital ; not less than 2^ per cent, of the net profits was to be devoted to an education fund ; the society's subscription to the Co-operative Union was to be paid ; the committee might devote a certain part of the profits to an assurance and pension fund ; then three-fourths of all remaining net profits were to go to all the persons who, during the period to which the division related, had been employed by the society for not less than six calendar months on the whole, the proportion of profits falling due to each person to be det-er- mined as the committee might decide from time to time — it was, in fact, distributed in proportion to the weekly wages — while the other fourth of the net profits was to go to the customers of the vsociety. All bonus coming to employees was to be in the shape of shares or payments on account of a share in the society. Mr. Brownfield was manager of the society, the rules providing that he could be removed only by the vote of five-sixths of all the members of the association and five-sixths of all the votes cap- able of being given at a special general meeting. He was to control all business carried on by the society, and engage, remove, or discharge, all assistant-managers, salesmen, or em- ployees of every description, &c., subject to the duty of regu- larly reporting all such acts to the committee. His remuneration was determined by an agreement made between him and the committee, which was part of the conditions of the purchase of the business. The committee consisted of 18 members, of whom 16 were persons employed by the society (including !Mr. Brownfield, one of the travellers, the art director, the cashier, the stock- keeper and several of the leading operatives), and two were representatives of trade unions (the ^"ational Order of Potters and the Pottery Hollow Ware Pressers' Society). The undertaking was at its outset considerably hampered by having to contend with the prejudice of the former customers of the late firm, who objected to the Guild Pottery supplying co- operative distributing societies, which led to a falling off m the trade done. The profits did not suffice to permit of the payment of any bonus to employees in 1894. In 1895 they received a bonus at the rate of 1} per rent, on their wages. In 1 U; COXVHRSION OF ORDINARY BUSINESSES 1S!)(» IK) Ikiiius was paid, ilio profits of the precediiif^- year not haviiit5 2^° Name anJ Address of Firm. 186.5 1866 1870 1874 1875 1876 1878 1878 1881 1912 1882 1883 1884 1886 14 1886 15 1889 16 1889 17 1889 IXame and address not for publication] Fox Bros. & Co., Ltd., Wellington, Somerset. Oolne Fishery Co.. Briffhtlinggea. [iVc//«e and addrens 7iot for jiuhli cation] Women's Printing Society, Ltd., 31-85, Brick Street, Piccadilly, London, W.l. Tollesbury and Mersea Native Oyster Fishery Co.. Ltd., Tollesbury, Essex. Sir W. G. Armstrong, Whitworth & Co., Ltd., Elswick Works, Xewcastle-on-Tyne. Cassell & Co., Ltd., La Belle Sauvage, Ludgate Hill, London, E.C.4. [Name and address not for jmhlication] Do. do. do, Brooke, Bond & Co., Ltd., Goulston Street, Aldgate East, London, E.l. Fidler & Sons, Royal Berkshire Seed Stores, Reading. Blundell, Spence & Co., Ltd., Hull Hazell, Watson & Viney, Ltd., 52, Long Acre, London, W.C.2. A. Boake, Roberts & Co., Ltd Carpenters Road, Stratford, London, K.1.5. \_Name and address not for jmblication] [Name and address not for puhlication] [Name and address not for jinhlieation] Nature of Business. Manufacture Woollen manufacture Oyster cultivation Bookbinding, lithography stationery manufacture. Letterpress printing and Oyster merchants and planters.. Shipbuilding, engineering and ordnance manufacture. Printing, publishing and book- binding. Manufacture ... Do. Tea blending and packing Seed and potato cultivation, farming, and fruit salesmen. Colour, paint and varnish manu- facture, oil boiling and refining, etc. Printing and bookbinding Manufacturing chemists Supply Paper manufacture Manufacture of leather board and shoe stiffeners. • As one and the same individual may hold investments of different kinds, there is a certain amount of duplication in the figures representing the number of employees holding investments. The figures include, in many cases, investments apart from the profit-sharing arrange- ments : but some employers are imable to give any information as to amounts privately invested by employees. (rt) Profit sharers may leave bonus on deposit with the firm. ROFIT-SHARINQ OR LABOUR CO-PARTNERSHIP. 151 SE LETTERS IN COLUMN 8 SIGNIFY AS FOLLOWS : — ■W.S.=paid partly as W. and partly as S. P.S.=paid partly as P. and partly as S. S.C.=paid as S. for a prescribed period or until employee has a prescribed holding, then partly as S. and partly as C. S.W.=paid as S. for a prescribed period or until employee has a prescribed holding, then partly as S. and partly as W. S.P.=paid as S. for a prescribed period or until employee has a prescribed holding, then partly as S. and partly as P. P.S.C.=portion of bonus paid as P. and remainder as S.C. an ding in Pension or Provident Funds in the names of individual employees. ' iiber employed Investments by Employees." during twelve ;nonths precediug i4 M declaration of Number of a honus in 1918. employees par- How a ticipating (or entitled to Bonus is No. of employees Nature of Investments. Total nominal ri Perma- Casual participate* Paid. liolding amount of 'u nent (Maxi- in 1918. Invest- Invest- tJl Iverage mum ments. ments. No.) No.) 5. 6. 7. 8. 9. 10. 11. 12. 128 28 127 C.(a) 141 Deposits. (ft) 1 1,423 — 828 W. 828 Deposits. 60,600 2 6(0 110(c) 430(c) C. — — — 8 170 — 30 C. — — — ■ 4 39 2 39 G.Cd) 12 Ordinary Shares. 320 5 19 82 100 C. 100 Ordinary Shares. 11,800 6 9,000 — 12,21 r, w. 12,215 Deposits. 581,908 7 810 12 810 p. (0 f Shares. V Debentures. 9,540 \ 300/ 8 626 — 575 c. -» c. / f 40 Shares. 9,831 1 { ^ \ 2a 626 — 40 \ 98 Deposits. 5,473 i 1,660 1 1st half year 827 2nd „ 867 i C.P. (*) C^-) (ft) 10 (i) ib) * C^-) (?') (*) (^) (ft) 11 665 — 444 c. 64 1 345 j 1,272 1 Ordinary Shares. 1 Preferred Shares. Shares. 5,825 ) 600 j 17,200 1 12 1.400 to .150(/) 220 c. Deposits ((/). 21,010 ( 13 691 64 Provident Fund (^). 18.164 [ 8,725 ) Pension Fund (17). 4.-)0 — (^) c. (5) (*) (ft) 14 (&) (*) C^-) c. (&) ( 171 (&) Provident Fund (ft) 4,398^ 15 184 _ J 1 1st half year 188 2nd ., 179 jc.p. {_» and Deposits. Loans. 404/ 16 83 ~ 88 c. 17 (&) Information not available. (c) Members of the company are employed in rotation. (rf) Employees hjuve the option of taking a third part of their bonus in shares, (e) Held by Trustees of various Charitable Funds. (/) Including those serving with the Colours. {g') For further particulars with regard to these investments, see account of scheme ou pp. 76-8. lb-2 Existing Schemes op Profit- Namc und Addreiw of Firm. Nature of Business. !«. IS89 I \ Xamc and iiiliii;:-!.* not for puhl'ieatwii] ... i Manufacture |s«'.t .s.mth .M.'tropulitan Gas Co., 7ii'.i, Old Kent Gasworks ... Hond. London, S.E.IO. 18'.tended. Firm is under Government control. (I) The Company's refineries are in America. The English house (to which alone the figures in this Table refer) is solely a distributing branch. (r) Information not available. («f) Scheme temporarily suspended. (#) In a few cafen the bonus is paid in cash. SHARING OR LABOUR CO-PARTNERSHlP-cr.^j/r/. 163 Number employed during twelve months preceding declaration oE bonus in 1918. iDve&tments by Employee*. Number of employees par- tiuipatinir (or f ntitled to participate; in 1918. 1,500 j - 50 I i 8,054 478 I 8,:i.-,(i Per- manent (Average No.) Caaual (Maxi- mum No.) 5. 6. How iJonus raid. W. 1,372 105 137 5o 43 44 331 1(33 40 1,100 722 80 73 2,290(^|) 1,487 I 270 43 130 1,419 80 1,132 10.-. 67 j 26 - ! (.0 - i 11 - j 1S40/) - ! 14S 1,123 - ! (562 . / 1 1st half year 52 i I 2nd ,." 58 93 1,%2 - j 1.13(1 - I (O - 43 i P.S. • I c.p. ! p. C.P.(«) c. (' c. W.('') p. No. of employee holdint; invBMi- mcnt-. Kmi 5.40(1 (1,590 S,l()() 3,745 2(18 1.132 217 74 w.s. t 1 72(1 1.02.-. en 748 c.p. 82 c. ■sr, W') 1,840 w, ( •S 949 (O C. p.s. I W.S. ' t P.S. (./) c.s. I 18 82 82 48 1,200 37 Nature o( Invi-atmenU. Stock. Stock (held by TruHtecH). r'ejiooitH ( P.F.). SujuTanntiation FUM.I Shares and Depuaite. Slmrfri and Debentures (P.F.). Deposits (P.F). Shares. Preference Shares. Dejwsits. Shares. Deposits. Ordinary Stock. Depo.sits. (Provident Fund, t DepoHitH. Deposits (P.F.y Deposits. Sliares. Preference Shares. Deposits. ('•) Shares. Deposits. Shares. Shares. Shares. Shares. Total DOIll tjLl am.. In 27. 7(» 166, ■VI 62 1 ,306; ,"00 j ,2fi4 3.6tJ0 2»'.ii 963 ( Vi.lUI I 8.339 ( 12.H91 \ fi.I49/ 4,792 :i96 145,758 2,99 l«xljfi«d in Provident Fund, credited to Deposit Account, or taken in " 69 70 71 72 73 74 75 76 77 78 79 80 81 82 -^ 82a/ 83 84 85 86 (^) Figures for Lever Bros., Ltd., only. The number of employees in the associated companies cannot be given ; but the number of employee-partners in these companies in 1917 was :— In the United Kingdom, 1381 ; abroad, 960. (A) The bonus is given in the form of dividends upon Partnership Certificates and is paid in shares ; see account of scheme on pp. 78-85. (j) Shares held by employees both of Lever Bros., Ltd., and of the associated companies. No information can be given as to shares acquired by employees outside the co- partnership scheme. (Jt) Exclusive of fruit pickers. LIS Existing Schemes of Profit- go c. .£ oca o S Si Name and Addrens of Finn. Nature of Dusinesis. 87 1911 88 1911 r89 1911 \89a 1914 90 1911 91 92 1911 1911 93 1911 94 1912 95 1912 96 1912 97 1912 98 1912 99 1912 100 1912 101 1912 102 1912 103 1912 104 1912 105 1912 .105 106 a 1914 1912 107 I 1912 108 109 110 1912 1913 1913 Merthyr Tydfil Gas Co., Picton Street, Merthyr Tydfil. [iVrt?;^e attd address 7iot for puhlication] Johnson Bros. (Dyers), Ltd., Bootlo Dye Works, Liverpool. Do. do, Liverpool Gas Co., Duke Street, Liverpool [Name and address not for publiration] lioders & Nucoline, Ltd., Cairn Mille, Silver- town, London, E.16. Chaa H. Osborne, 61, Bute Street, Luton ... Harrow and Stanmore Gas Co., Gas Works, Harrow. Hertford Gaa Light Co., Gas Works, Hert- ford. Notting Hill Electric Lighting Co., Ltd., Netting Hill Gate, London, W.ll. Wilkinson & Riddell, Ltd., Birmingham ... Aldershot Gas, Water, and District Lighting Co., Aldershot. Bradford Dyers' Association, Ltd., 39, Well Street, Bradford. [Name and address not for publicatiofi~} Solicitors' Law Stationery Society, Ltd., 104-7, Fetter Lane, London, E.C.4. [Name and address not for puhUcation'\ Samuel Jones & Co., 7, Bridewell Place, London, E.C.4. R. S. Murray & Co., Ltd., Fleet Works, 57, Clerkenwell Road, London, E.C.I. E. S. & A. Robinson, Ltd., 1, RedclifPe Street, Bristol. Do. do. Robert Martin, Ltd., Tower Street, West Hartlepool. Reuben Gaunt &; Sons, Ltd., Springfield Mills, Farsley, Yorks. James Cropper & Co., Ltd., Burnside Mills, Kendal. Waygood-Otis, Ltd., Falmouth Road, London, S.E.I. Canterbury Gas & Water Co., Castle Street, Canterbury. Gasworks Brewers, millers and wine mer chants. Dyeing and dry cleaning Do. do. Gasworks Farming Oilseed mills ... Straw hat manufacturer Gasworks Gasworks Supply of electricity Textile merchants Gas, water and electricity under taking. Commission dyers and finishers.. Merchants Law and Parliamentary printers and stationers. Manufacturing ironmongers and engineers. Gummed paper manufacture, etc., and engineering. Manufacture of confectionery and chocolate. Lithographic printing and manu- facture of stationery. Do. do. Letterpress printing Worsted spinning, wool comb- ing, and woollen cloth manu- facture. Paper manufacture Lift and crane engineers . . Gas and water undertaking (a) Information not available. (J) For 1917. (o) Bonus may be left on deposit with the Society at 4 per cent, interest. SHARING OR LABOUR CO-PARTNERSHIP — C07\td. 150 Number employed during twelve months preceding declaration of bonus in 1918. Number of employees par- ticipating (or entitled to participate) in 1918. How Bonus is Paid. Investments by Employees. c No. of employees holding Invest- ments. Nature of Investments. Total nominal amount o( Invest- menta. i 3 7i Per- manent (Average No.) Casual (Maxi- mum No.) "3 •c 9 CO 5. 6. 7. 8. 9. 10. 11. 12. 56 61 965 5 16 60 418 s.w. c, w. { 14 60 2 882 Stock. Ordinary Shares. f Preference Shares. -! let Mortgage De- L benture Stock. Deposits. 240 87 1,090 j 1,880 r ^^ 10,420 89 • 965 2,182" 31 974 26 307 2,208 23 257 c. w.s. c. W.P. { 307 1,275 30 287 Shares. Ordinary Stock. / Ordinary Stock. \ Mortgages. Bonus Certificates. 5,885 89a. 28,976 ^ 4,903 \ 90 2,4.50 J — 91 4,746 1 92 («) («) («) c. — — — 93 129 18 12 21 87 24 s.w. s.w. { 67 9 7 / Ordinary Stock. \ Preference Stock. Shares. Deposits. ??} - 27 — 27(5) c. — — — 96 421 — 248 c. — — — 9" 234 31 190 S.P. { 168 190 Stock. Deposits. 2,704 \ 2,574/ ^^ 9,800 — 3,600 c. 3,600 Ordinary and Pre- ference Shares. 295,870 99 1 345 24.5 271 243 O.P. C.(.) { { 32 11 14 4 Shares. Deposits. Ordinary Shares. Deposits. 180 — 115 c. — — — 102 378 — 115 c.w. 238 Deposits. 6,yn0 103 386 286 0. — — — 104 2,134 — 1,858 C.(d) — — — 105 1 2,131 10 — 672 7 w. S.W.(e) 678 6 Deposits. Shares. 23,870 1 106 05a J 106 648 109 c. / I 9 128 Ordinary Shares. Deposits. 3,400 \ 10,889 J 107 490 — 43 p. { 43 162 Loans. Deposits. 3,324 \ 6,570/ 108 841 — 52 w. 52 Deposift. 1,299 109 99 87 w.s. 60 Ordinary Shares. 579 110 ( •< X I, » 2 ® n 2. Name and Addresa of Firm. Nature of Business. 4. 1915 1915 1910 1910 1910 1917 1917 1917 1918 1918 1918 1918 1919 1919 1919 1919 1919 1919 1919 1919 1919 1919 1919 1919 1919 Homo & Colonial Stores, Ltd., 2 & 4, Paul Street, Finsbury, London, E.C.2. Court Laundry (IL C. Neill-Wutson, pro- prietor), Ilarcourt Street, Dublin. \Vm. Goodacre & Sons, Ltd., Ceylon Mills, Victoria Docks, London, E.IO. Eva Bros., Clayton, Manchester T. & C. H. Arrowsmith, Ltd., Astley Mills, Astley, nr. Manchester, Wm. Hollins & Co., Ltd., Pleasley Vale, Mansfield. British Cyanides Co., Ltd., 49, Queen Victoria Street," London, E.C.4. Watson, Laidlaw & Co., Ltd., 98, Dundas Street, Glasg^ow. Indemnity Mutual Marine Assurance Co., Ltd., 1, Old Broad Street, London, E.C.2. Henry Crossley, " News" Office, High Street, Wether by, Yorks. Jacobsen, Welch k Co., Ltd., Newton House, 7, Paternoster Square, London, E.C.4. T. Snowden k, Son, Argyll Mills, Bingley, Yorks. [JYame and address nut for ■i>n'bUciition'\ S. P. Myers & Co., Ltd., Bradford and Wilsden, Yorks. George Hill & Son, Ltd., 227, High Road, Streatham, London, S.VV.IO. Joseph Wilson, Ltd., Grange Shed, Bradford Jones Bros, k, Co. (Wolverhampton) Ltd., Ablow Street, Wolverhampton. r,ondon County Westminster and Parr's Bank, Ltd., 41, Lothbury, London, E.C.2. "Our Sons," Ltd., 18-22, Electric Avenue, Brixton, London, S.W.9. Sir John Shelley- Rolls, Bart., Avington, Itchen Abbas, Winchester. Sutton &; Co., Golden Lane, London, E.C.I. W. Dennis & Sons, Ltd., Kirton, Lines. Wm. Gray & Co, (1918), Ltd., West Hartle- pool. Achille Serre, Ltd,, Hackney Wick, Lon- don, E,9. Robt. Ingham Clark & Co,, Ltd., West Ham Abbey, London, E.15, Retailers of grocery and pro- visions. Power laundry Coco mat and matting manu- facture, and engineering, Forgemasters Cotton spinning and weaving ... Textile spinning and manu- facture. Chemical manufacture .,, Manufacture of centrifugal dry- ing and separating machines, etc. Marine insurance.,. Newspaper proprietor and printer. Envelope makers and manu- facturing stationers. Dress goods manufacture Boot and shoe manufacture Stuff manufacturers and mer- chants. Builders, contractors, etc. Stuff manufacturers Metal stampers ... Banking Clothiers and outfitters Farming General carriers Potato growing Shipbuilding Dyeing and cleaning Manufacture of aeroplane dopes and coverings, varnishes and enamels. (a) The excess of participating employees over the average number of permanent employees is due to the large number who joined H.M, Forces, (6) Employees may leave their bonuses on deposit with the firm at 5 per cent, interest, ((•) The bonus is given in the form of certificates entitling the holder to the income on a stated proportion of a common fund, held by Trustees on behalf of the participat- ing employees collectively. (f7) The bonus is paid into a Post Office Savings Bank Account, but employees over 21 years of age may take their bonus in cash. Sharing or Labour Co-partnership— co/iic^. 1G3 Per- manent (Average No.) Number employed during twelve months preceding declaration of bonus in 1918. Casual (Maxi- mum No.) Number of employees par- ticipating (or entitled to participate) in 1918. Investments by Employees. How Bonus Paid 8. No, of employees holding Invest- ments. Nature of Investments. 10. Total nominal amount of Invest- ments. 11. 3,137(a) 126 800 92 313 2,351 186 414 44 7 495 119 Not stated. 180 — 2000^;) — 50(^) 250) 257(i7) — (/O (70 4,2000) — 240) — 530) — 00 w 400-500 — 0) 5.4920) 250) 6280) — 162 — . 4,4300) 106 427 62 313 912 218 432 44 9 483 119 C. C.P. C.(&) c. c. s.o) c. c. c, c. w.O) S.O) C.P. s.(/) c. p. (70 0. c. c. c. c. c. (75) c. 120 18 912 21 2 15 3,136 17 Loan Capital Deposits. Ordinary Shares. Preference Shares. Deposits. / Preference Shares. \^ Ordinary Shares. Ordinary Shares. Deposits. Preference Shares. Loan Capital. Shares. Ordinary Shares. 983 3,4631 85U V 145 J 3,260 \ 3,000 J 12,645 \ 252 J 658 150 66,536 678 O) Bonuses credited to employees' individual Loan Capital Accounts, with the proviso (i.) that firm may pay the whole or part of the bonus in cash if additional capital is not required, and (ii.) that an employee, when sums accumulated out of bonus in Loan Capital Account exceed total full wages for one year, may withdraw such excess. (/) For the present it is the intention of the Company to pay the bonus in the form of employees' shares ; but it may be paid in cash, at the Company's option. O) Number in 1919. (^) Information not available. „ , , . c -n < ^ a O) Number employed by London County and Westminster Bank, exclusive of Parr s staff The number relates to 1919. (As) Not yet determined. Existing Schemes of Profit- so a .2 ^'2 oS| 9 P o l.-.s 191 it l.VJ mill it;o 1919 IGl 1919 102 1919 u;3 1919 ltJ4 1919 16-". 1919 i(;6 1919 167 1919 168 1919 169 1919 170 1919 171 172 173 174 175 176 1919 1919 1909 W 1917 (A) 1918 00 1918 (A) N:iini' and Adilres:4 of Firm. Uurmah Oil Co.. Ltd., 17.'), West George Street. Glasg-ow. Edward Wood A: Co., Ltd., Ocean Iron Works, Ordsal Lane. Manchester. J. L. Thomas & Co., Ltd., Exeter Constructional Co-partnert<, Ltd., Chepstow, Mon. Alfred Hickman. Ltd., Bilston, Staffs. British Empire Trust Co., Ltd., 34, Nicholas Lane, London, E.C.4. Coaster Construction Co.. Ltd., Rossie Island, ?[oiitrose. Distillers Co., Ltd., 12, Torpichen Street, Edinbur;i-h. Crompton .t Co.. Ltd., Salisbury House, London Wall, London, E.C.2; Grout & Co., Ltd , Yarmouth Tootal Broadhursc Lee Co., Ltd., :>f>, Oxford Street, Manchester. Carrbrooke Manufacturing' Co.. Batley Carr Joseph Smithson, Ltd., India Buildings, Horton Street, Halifax. Hawkins i: Tipson, Ltd.. Globe House, 29, Minories, London, El. ■ Donald Campbell & Co., Ltd., 10, St. Mary Axe. London. E.C.3. Wise, Speke & Co., 28, Coliingwood Street, Xewcastle-on-Tyne. Fletchers Sauce Co., Ltd., Selby, Yorkshire Jordan k Sons, Lta., 116 k 117, Chancery Lane, London, W^.C.2. Lily Laundry, Ltd., Russell Street, Dar- lington. Nature of Business. 4. Oil company ... Constructional engineers Soap and candle manufacturers, oil and colour merchants, manufacturers and importers of lamps. Public works contractors, engi- neers, etc. Ironmasters, etc. ... Trustees, registrars, industrial finance and banking business. Shipbuilding Distillers and con Electrical engineers tractors. Silk manufacture Textile manufacturers and mer chants. Blouse manufacturers Dress goods manufacturers Rope manufacturers Eastern and general produce merchants. Stockbrokers Sauce manufacturers Company registration agents, printers and publishers. Steam laundry (a) Employees in the United Kingdom only. The figure relates to the year 1919. (J) Number in 1919. (c) The bonus is given in the form of dividends upon Partnership Certificates and is paid in Shares. ( c. — Sale of Farm. x\0 400 or 600 198-205 ■ Not known c. c. Not known — Dissatisfaction of employers with results. Conversion of business into limited liability company. Not known. xU xV2 xVi „ C. Shares Not known. x\i 900 c. c. Shares Dissatisfaction of employers with results. Substitution of shorter hours. xlb a!l6 ' Not known c. Shares Dissatisfaction of employers with results. xll )) w. — Death of employer. j-lS I 200 i c. Shares Dissatisfaction of employer with results. x\^ the whole of the amount distributed was invested by the participants in the 170 Abandoned Schemes op Profit- Date of Com- 6 mencomcnt ^ and of 5 Termination of Name and Address ol Firm. Nature of Business. Prollt-slmring or Co-piirtnorship. I. 2. 3. 4. ar20 1872 Troughton & Simms, 138, Fleet Mathematioal Instru- Street, London, E.C.4. ment making. 2-21 1872-84 Spottiswoode k Co., New Street Square, London, E.C.4. Printing 7 Dissatisfaction of employers with xoS system. I Liquidation. .'•59 A pathy of employees, and liabili- «60 ties imposed by Workmen's 1 Compensation Acir. Dissatisfaction of employers with , j61 results. i Apathy of employees. 1 a;62 Dissatisfaction of employers with [ d"63 results. I Transfer of business. | x6i Job finished ; discontinuance of , d-i'>'> business. Want of success. ^"66 (d) In 1903 and later years part of the bonus was devoted to various clubs, a library, &c ; there was a small distribution of cash in some of these years, but no sums were carried to Provident Fund. (e) C.P. from 1900 174 Abandoned Schemes op Propit- Dato of Cora- moneement and of Termination of Proflt-flharing or Co-partnership, 2. Name and Address of Firm. Nature of Business. 4. xG7 «68 a;69 aj70 xll xl2 a;73 xli ^75 xl& xll a;78 x79 a-80 a:81 a;82 x83 arSl 1890-1908 1890-1916(a) 1890-1900(J) 1890-1903 1890-(?) 1890-98 1890-91 1890-93(0 1890-95 1890-92 1890-93 1890-91 1890-91 1890-93 1890-9i 1890-92 1890-1909 1890-1903 1890-93 -a;86 1890-97 ar87 1890-91 a!88 1890-1907 ^89 1890-91 a;90 1890-1904 ar91 1890-1900 ar92 1890-91 JackRon & Sons, King's Road Corner, Reading. McVitie &; Price, St. Andrew Biscuit Works, Edinburgh. Robert Martin, Crown Printing Works. West Hartlepool. Newman & Son, 27, Widegate Street, Bishopsgate, London, E.C.2. Thomas Hailing, Oxford Works, Cheltenham. Cardiff Milling Co. (formerly James Tucker, Ltd.), Cardiff. Bailey, Nokes i: Co., Ltd., Bir- mingham. London, Deptford and Greenwich Tramways Co., London. Archibald Edmeston & Son, Can- non Street, Salford. G. Hubbard, 1 1 2, Fenchurch Street, London, E.C.3. Kensington Co-operative Stores, Ltd., London. General Service Co - operative Stores, Ltd., London. Central Co-operative Stores, Ltd., London. London Co-operative S upply Stores, Ltd., London. Charles Joyner & Co., Icknield Square, Birmingham. G. Holloway, Temple Guiting, Gloucestershire. [jVanie and address not for pub- lication.] Osborne & Young, Coldharbour Lane, Brixton, London, S.VV.9. Robert McVitie, Queensferry Street, Edinburgh. W. & J. Mackay k Co., Ltd., Fair Row, Chatham. Browett, Lindley & Co., Ltd., Sal- ford (now Sandon W^orks, Patri- croft, Manchester). [yame aiid address not for pub- lication.'] Drake & Gorham, Ltd., 66, Victoria Street. London, S.W.l. Marquis of Hertford, Ragley, Warwickshire. Headley Bros., Ashford, Kent ... Joseph Bromhead, Westbury, nr. Bristol. Tailors and Outfitters... Biscuit ManufaoturerB Printing Printing Printing Millers Rolling Mills and Am- munition Makers. Tramways Engineering Works ... Building Stores Stores Stores Stores Chandelier &c. Manu- facturers. Farming... Engineers Corn Merchants, Flour Factors and Forage Merchants. Baker and Confectioner Printing, Bookbinding, &c. Engineering Works Fruit Preserving Electrical Engineering Farming... Printing... Laundry Work ... (a) Scheme suspended for some years during this period. (J) Mr. Martin introduced another profit-sharing scheme in 1912, which is still in force, see No. 106, p. 158. SHARING OR LABOUR CO-PARTNBRSHIP— con^rf. 175 Number of Employees at date of Termination. How Bonus was paid. Nature of Investments (if any) by Employees. Ueason for Abandonment of Scheme. d 3 1 5. 6. 7. 8. 9. 45 250 C. c. — Dissatisfaction of employers with results. Dissatisfaction of employees. a?r,7 14 26 c. C.(.) Deposits (P.F.) Deposits Dissatisfaction of employer with results, (h) Transfer of business. a?70 9 c. _ Not known. ^71 120 c. Deposits Liquidation. cc72 Not known 0. — Want of success. xU Over 100 0. — Apathy of employees. xli 60 c. — Dissatisfaction of employers with results. Want of success. xl^ Over 150 c. — xl& Not known Not known — Want of success. xn i» II — Liquidation. a;78 )) II — Liquidation. xl9 ») )i — Liquidation. x80 250 Not known C.P. S. (loans) Deposits (P.F.) Deposits Conversion of business into limited company. Death of employer. a;81 .f82 1,185 94 C. C. Workmen's Debentures. Deposits Diminution of profits. Dissatisfaction of employers with results. a;83 x8i 65-70 72 C.(i) C. Deposits (P.F.) Business converted into a limited company, a number of em- ployees taking shares. Apathy of employees. a-85 xSa 80 10-18 c. c. Dissatisfaction of employees and removal of business to other works. Want of success. ^•87 a-88 Not known c. — Not known. a?89 25 c. Farms let. ar90 77 100 w, c. Changes in business arrange- ment?. Dissatisfaction of employer with results. j-!)l .r92 (^) C. till 18'.t9 ; then S. Id) P. from 1896. i7«; Abandoned Schemes of Profit- Date of Com- 6 mencement 'A and of •j Termination of Name and Address of Firm. Nature of Business. o I'rotlt-sharing or Co-partnership. \. 2 3. 4. ./•'.>:{ 1890-19(11 Idris & Co., Ltd.. Camden Town, Mineral Water Manu- London, N.W.I. facture. iP94 189()-(?) William Terrell & Sons, Ltd., Wire and Hernp Rope Amos Vale, Bristol. and Patent Engine - packing Manufatiture. i .r9.-) lbl)0-1916 \^Name and addreag not for pnh- li ration.] Millers ' j,96 (a)lS9l-99 Hon. T. A. Brassey (afterwards Lord Brassey), Park Gate, Battle, Sussex. Farming (two farms) ; a-97 1891-94 Phillips & Co., Wrexham Teamen and Grocers ... a-98 1891-1909 Women's Work A.?sociation, Chel- tenham. Embroidery, &c. .r99 1891-99 William Lawrence & Co., Ltd., 64, London Road. Nottingham. Cabinet Making, &;o. ... ' ,rlOU l.s91-93(?) Edward Take & Co., Bradford Wholesale Produce Mer- i and Leeds. chants. i JflOl 1891-97 John Barbour & Co., Whitehouse, Belfast. Flax Spinning ... ;rl02 1891-1906' Dobson & Barlow, Ltd., Kay Street Works, Bolton. Engineers arl03 ]891:r94(J) Sir Alfred Hickman, Spring Vale Furnaces, Wolverhampton. Iron Smelting ... ... ' «104 1891-1902 Franklyn, Davey & Co., 12, Welch Tobacco and Snuff Manu- Back, Bristol. facture. a;105 1891-1900 [Name and address not for pub- Manufacture of Woollen lication.'] and Worsted Goods. --C106 1891-98 R. H. & S. Rogers, Ltd., 9-12, Shirt and Collar Manu- Addle Street, Wood Street, facture. London, E.C.2. . - «107 1891-93 Joseph Collard, 43, Charing Cross Road, London, W.C.2. Printing and Stationery a;108 1891-99 Waltham Bros., Ltd., Stockwell, London, S.W.9. Brewers arl09 1891-95(0 Crompton & Co., Ltd., 381, Salis- bury House, London, E.C.2. Electrical Engineers ... alio 1892-96 Petty k. Sons, Ltd., Whitehall Printers and Manu- ' Printer ies, Leeds and Reading. facturing Stationers. ,t111 1892 Robert Mushet & Co., Bonnington Iron Works, Leith. Engineers a.-112 1892 Welsh Liberal Newspaper Co., Newspaper Printers aad Ltd., Swansea. Publishers. ,rll3 1892-(?) James Johnston, Abbey Road, Stirling. Timber Merchant ... '. a-lH 1892-95 Peel Bros., LiQColn Corn Merchants and Millers. aril.-) 1802-97 John Devereux & Sons. High Street, Lowestoft. Grocers, &c 1 a-116 1892-94 Raithby, Lawrence &. Co., Ltd., Queen Street, Leicester. Printers, &c a-117 189-2-94C?) John Ratcliffe, 108, St. George's Road, Bolton. r)ecorator (a) Profit-sharing was started on one farm in 1891 and on the other farm in 1895. (/>) A fresh scheme has recently betn [started in this business (now Alfred Hickman. Ltd.), see No. 1G2, p. 164. SHARING OR LABOUR CO-PARTNERSHIP— COn^(i. 177 Number of Employees at date of Termination. How Bonus was Paid. Nature of Investments (if any) by Employees. Reason for Abandonment of Sc'heme. ' "5 I 9. 750 102-118 8 16 14 8 400 P. C. c. C. (rf) c. Xot known Preference Depression of trade. I a!93 } Shares and Deposits (P.F.). I — Dissatisfaction of employers with 3-94 results. — Business closed. Deposits ! Occupation of farms given up. 25 C. 450 C. 2,800 C. 500 C. 163 c. 200-250 w. 1,000 c. 23 c. 133 C.P 500 0. 223 c. Deposits Deposits Debentures Deposits Deposits Workmen's Debentures. 223 C. Shares 200 C. — 18 C. or S. Shares Not known C. 20-25 c. — 46-50 c. — 165- c. Shares 15-40 c. — Conversion of business into limited company. Liquidation. Special circumstances connected with conversion of business into company. Not known. Bad state of trade. Apathy of employees, Dissatisfaction of employer with results, (h'). Transfer of business. Badness of trade. Apathy of employees and liabili- ties imposed by Workmen's Compensation Act, 1897. Dissatisfaction of employer with results. Dissatisfaction of employers with results. Scheme not taken up by employees generally, (c). Dissatisfaction of employers with results ; share-purchase system substituted. Dissatisfaction of employers with results. Not known. Not known. Dissatisfaction of employers with results. Dissatisfaction of employers with results. Voluntary liquidation and recon- struction of company. Dissatisfaction of employer with rpsults. j-96 a;97 r98 a;99 iclOO ajlOl a.-102 .Trios a;104 a;106 J- 106 a- 107 xlQ9> a- 109 •rl 10 a;lll a;lia *113 xlU xUh xUQ xm Co') This Company has recently started a fresb scheme, see No. 166, p. 164. . (d) At one of the farms the bonus was to have been paui partly in cash and partly in shares, but no bonus was in fact earned on this farm. 178 Abandoned Schemes of Profit- Diite of Com- & menoomont % iiml of 1 rcrmination of Name and Addrebs of Firm. Naturo of Bueinesi. rroflt-slmring OQ or Co-partncrsliip. 1. 2 3. 4. 1893-1902 Brush Electrical Engineering Co., Ltd., 11, Arundel Street, Strand, London, W.C.2. Electrical Engineering a;126 1893-1912 Jacob Pickwell, 409, Victoria Street, Grimsby. Master Stevedore 35127 1893-99 William Parnall & Co., Ltd., 108, Victoria Street, Bristol. Shop Fitters, kc. «128 1893-95 The Ideal Club and Restaurant, Restaurant and Sale of 185, Tottenham Court Road, Provisions. London, W.l. al29 1893-(?) Jesse Mundell, Middlesbrough ... House Painter a;130 1894-98 William Cussous, Ltd., 18, Beverley Grocers, Provision Mer- Road, Hull. chants, «fcc. «131 1894-1900 Clark's Bread Co., Ltd., 12, Font- hill Road, Hove, Brighton. Bakers and Confectioners a;132 1894-1909 Richard Briggs & Sons, Lime Manufacturers and Ltd., Bankfield Lime Works, Quarry Proprietors. Clitheroe, Lanes. ^133 1895-98 E. Broad, Redruth, St. Austell, and Hayle, Cornwall. Draper a;134 1895-97 R. Biuns & Sou, Cross, near Fruit Growers and Axbridge, Somerset. Nurserymen. a;13o 1895-98 Smith and Forrest, Manchester ... Oil, Tar, and Resin Dis- tillers and Merchants. a;136 1895-96 Wm. Hancock & Co., Ltd., Cardiff Brewers a;137 1895-97 White Stile Laundry, Brentford Laundry a;138 1895-96 N. J. Powell & Co., Ltd., 101, Vellum Binders and Whitechapel High Street, Pocket-book Makers. London, E.l. «139 1895-99 John A, Hunter & Co., Liverpool Provision (Bacon, &c.), Merchants. fl!l40 1896-98 Kensington Co-operative Stores, Ltd. (Dressmaking Depart- ment), 64-74, Hammersmith Road, London, W.14. Dressmaking, &c. xUl 1896-1901 A. Morton & Co., Darvel, Ayrshire Curtain and Carpet Manufacturers. mU2 1896-1909 Nottingham Brewery, Ltd., 52-58, Mansfield Road, Nottingham. Brewers ajU3 1896-1907 [Na7)ie and address not for pub- lication.] Provision Merchants ... 0144 1897-1901 Herbert Hutchinson, Haslemere, Surrey. Architect and Builder (a) But after a prescribed amount had been accumulated further bonuses, and SHARING OR LABOUR CO-PARTNBRSHIP— COn^rf. 179 Number of Employees at date of Termination, 47 456 45 70 302 25 510 1,315 4,400 45 20 9-] 2 190-200 94 80 150-180 5 30-40 158 17 80-100 70 10-18 681 200 10 140 How Bonus was Paid. Nature of Investments (if any) by Employees. Reason for Abandonment of ."^cheme. C. c. c. c. c. c. W.P. Not known C. P.(a) C. c. C.P. Deposits c. — c. Debentures c. — c. c. Shares c. Shares c. c. Co-partner- ship Certificates. C.P. Deposits (P.F.) c. — Depo8its(P.F.) Deposits Deposits (P.F.) Dissatisfaction of employers with .ell 8 results, "Lapsed." asiig Dissatisfaction of employers with a;120 results. Diminution of profits, a;121 Apathy of employees. a:122 Liquidation. j?l23 Dissatisfaction of employers with .z;124 results. Dissatisfaction of employers with a;125 results. Dissatisfaction of employees with a!l26 system. Liquidation, a;127 Failure to earn profit. ail 28 Not known. a?129 Dissatisfaction of employers with a;130 results. Dissatisfaction of employers with a;131 results. Dissatisfaction of employers with arl32 results, and grant of higher wages. Information not available for a;133- publication. Transfer of business. a;134 New responsibilities of employers xl'So under Workmen's Compensa- tion Act, 1897. Dissatisfaction of employers with xl'Sly results. Transfer of business. a;137 Changes in business. arl38- Changes in constitution of firm. xl^9 Liquidation. a; 140 Dissatisfaction of employers with ajl4l results. Diminution of profits. a;142 Substitution of increased wages. xH^ Conversion of business into Co- Jl44 operative Society (^nee pp. 146-8). the interest on accumulated bonuses, were paid in cash. 180 Abandoned Schemes of Profit- Date of Com- ! 6 mencement 7, and of "rt Termination of Name and Addiei-s of Firm. Nature of Businesi. 'J* rroHt-sharing or 1. Co-partnerehip. 2_ :\. 4. «;14r» 1897-1903 Richmond ( Jas Stoveand Meter Co., 1 Gas Engineers (manu- Ltd., Warrington. Stratford, &c. facturers). a-ltfi 1897-1905 [iVaff/(? and tiddriKK not for jmh- lication.'] Builders 1 x\M 1898-1902 Meath Home Industries Associa- Xeedlework, Embroid- tion, Randlestowp, Xavan. ery, Weaving and} Knitting. ! a:148 1898-1907 \_Name and addrexx not for puh- Pencil - Case Makers, ' li cat ion.] Silversmiths, ice. «14» 1898-1904 Ill'ord, Ltd. (formerly Britannia Manufactui'ers of Pho- Works Co.. Ltd.), Ilford, Essex. tographic Plates and Papers. 1 arloO 1899-1901 J. E. Nelson. Sunderland... ■ Slater and Slate Mer- chant. a;ir)l 1900-04 Teesdale & Co., Ltd., South Vale Manufacturing Confec- i Works, Carlisle. tioners. a-152 1900-03 Young it Marten, Ltd., Caledonian Builders' Merchants, &c., Works, Stratford, London, E.15. Manufacturers, Iron- founders, kc. 8-ii. 182 Abandoned Schemes of Profit o Date of Oom- 1 meneoment (vnd of ■3 •c Tormination of Name and Address of Firm. Nature of Business. Proflt-sharing or Co-partnership. 1. 2. 3. 4. fl-171 1905-13 {^Name and address not for pub- Provision Merchants liration.] and Food Specialists. 0-172 190G-16 Mail and Leader, Ltd., High Bridge, Ne\vca8tle-on-Tyne. Newspaper Publishers a-173 1907 Levant Mining Co., Pendeen, Cornwall. Tin and Copper Mining a-174 1907-10 Raymond Bro8., Manor Road, Cabinet Making and Yeovil. Upholstering. arl75 1907-16 A. C. Penman, Queensbury Motor Motor Carriage Manu- Works, Dumfries. facturing. arl7G 1907-14 [Name ufid address not for puh- Manufacturing Confec- lication.'\ tioners. xl77 1907-12 Gilbert Bros., School Lane, Nant- wich. Boot Manufacturers ... arl7S 1908-18 Castner-Kellner Alkali Co., Ltd., Weston Point, Runcorn. Chemical Manufacturers ajl79 1909-10 Irvine's Ship Building and Dry Docks Co., Ltd., West Hartle- pool. Shipbuilding a;180 1909-11 Carmarthen Gas Co., Carmarthen. Gasworks «181 1909-17 \_Name and address not for puh- Training and Supply of lication.l Nurses. a;182 1909-11 Norman Sawyer & Co., Ltd., St. George's Hall, Cheltenham. Printing... arl83 1910-11 Wessex Press, Ltd., 35, Fratton Newspaper and Letter- Road, Portsmouth. press Printing. arlS-l 1910-13 J. T. Cooper & Son, King's Street, House Furnishers and Gravesend. Removal Contractors. a-185 1910-18 Longwood and Slaithwaite Gas Gasworks Co., Longwood, Huddersfield. arl86 1910-12 [JVame and address not for pub- lication.] Manufacture ... arl87 1910-14 [A'^ame and address not for pub- lication.] Provision Merchants aTl88 1911-18 Plymouth and Stonehouse Gas Light and Coke Co., Plymouth. Gasworks a!l89 1912-14 [JVame and address not for pub- lication.] Manufacture arl90 1912-14 []\^ame and address not for pub- lication.] Rag Merchants... a!l91 1913-15 John S. Booth & Sons, Ltd., Castle Bank Mills, Wakefield. Cloth Manufacturers a:192 1913-16 Paget and Allsebrook, Oldfallings Farm, Wolverhampton. Farming arl93 1914-15 Brough and Sons, Oxford Street, Newcastle- on-Tyne. Provision Merchants a-194 1914 A. Simpson, 3a, New Briggate, Leeds. Photographer ... irl95 1914-18 Maidenhead Gas Co., 5, High Gasworks ,, Street, Maidenhead. arl96 1914-17 Grainger and Smith, Ltd., High Woollen Merchants and Street, Dudley. Warehousemen. al97 1914-(?) Paget and Rymer, Tytherington, Falfield, Glos. Farming a-198 1915-16 J. Blakeborough & Sons, Ltd., Engineers and Valve Brighouse, Yorks. Makers, Iron and Brassfounders. (a) Held through " Gilbert Bros. Employees, Ltd." Sharing or Labour Co-partnership — contd. 183 Number of Employees at date of Termination. How Bonus was Paid, Nature of Investments (if any) by Employees. Eeason for Abandonment of Scheme, d 3 u o 5, 6. 7. 8. 9. 18 C. — Dissatisfaction of employees. a;171 250 c. Shares. Dissatisfaction of employees. a,- 172 465-523 7 50 10 c. c. c. c. Deposits. Deposits, Dissatisfaction of employers with results. Dissatisfaction of employers with results. To allow employees to invest in War Loan. Change of management. a;173 xUo xl76 94 1,150 Not known P.S. c. c. Shares (a) Preference Shares. Dissatisfaction of employees ; demand for increase in wages. Confusion caused by wages awards in which bonus some- times was taken into account and sometimes not. Dissatisfaction of employees. a;177 a;178 a-179 19 3 c. c. — Dissatisfaction of employers with results. Shortage of staff. a; 180 a;181 46 c. — Dissatisfaction of employees. xl82 50-130 c. — Liquidation. a!l83 40 c. — Apathy of employees. a;184 84 600 58 w.s. c. Ordinary Stock and Deposits. Deposits and Deposits (P.F.) Undertaking municipalised. Dissatisfaction of employers with results ; strike. Want of success. d;185 u;18G a;187 406 Not known S.P. c. Shares and Deposits. Dissatisfaction of employers with results. Dissatisfaction of employees. a;188 xl89 14 230 5 c. c. c. Shares and Deposits. Business formed into a limited company. Dissatisfaction of employers with results. Farm given up. 3-190 0-191 a-192 300 c. — Apathy of employees. a;193 7 c. — Outbreak of war. arl94 50 w.s. — Dissatisfaction of employees. a-195 750 Not known p. c. Deposits. Abandoned in favour of monthly bonuses. Farm given up. j-196 0!l97 900 c. — Introduction of the 12J per cent. bonus. a-igs (J) But after a prescribed amount had been accumulated, further bonuses were paid in cash. 1S4 ABANDONED PROFIT-SHARING SCHEMES, CLASSIFIED. AIM' END IX H. (i). Ama.vdonei) Sciikmks of PiioFiT - sharixg or Labour Co-rARTNKKSHir, SUiMM AUISKIJ BY (a) FoRM OF BONUS I'avmkxt and (/j) Pkriod in which Started. Schemes started How 1 Bonus was Up to 1 paid.* and in- (B71- 1881- ISSfi- 1891 1S96- 1910- 1911- Total cluding 80. Ho. yo. 9.-). 1900. 10. 19. 1870. C. W. P. S. C.P. 16 9 1 42 37t 13 23 8 152+ 3 7 2§ 14 — 1 ; — 2 1 — -1 2 3 2 1 2 2 2 c.s. — — — 1 t 1 — — 2 Miscel- — — 1 2 2 — 2 2 911 laneous. Not 1 1 — 2 — — — 9 known. Total... 17 13 7 •"is U 19 29 11 198 * The references are to the code letters used in Appendix B. (pp. 168-183). For an explanation of these code letters, see notes at head of Table on pp. 168-9. t One employer had a C. scheme on one farm, and a C.S. scheme on another. The latter has been ignored, as no bonus was ever paid under it. X Including- four schemes where the bonus was C. for the greater part of the time, but either P., C.P., or S. for the remaining years. § Including one scheme in which the bonus was S. for the greater part of the time, but C.P. during the first few years. II Including two W.S. schemes ; two W.P. schemes ; one P.S. scheme ; one S.P. scheme ; and Nos. ic 34, the regular headings. ■4.T, and .'• 112, which cannot be classified under anv of RATIO OP BONUS TO WAGES. ].S5 APPENDIX C. RATIO OF BONUS TO WAGES UNDER PROFIT-SHARING SCHEMES 1901-18 (SO FAR AS REPORTED). Note's. (i.) It should be noted that the figures for each year include bonus distribu- tions under schemes which were in existeuce in that year but have since Ijeen abandoned. (ii.) Where a firm has two distinct and separate schemes, the bonus distril)u- tion under each scheme has been counted separately. (iii.) Where the bonus is paid at intervals of less than a year, the total amount paid for the whole year has been taken. (iv.) No information can be given as to the ratio of bonus to wages in a certain number of schemes in each year. In addition to those cases where the employers have failed to make returns, there are two classes of schemes in which the ratio of bonus to wages can rarely be given, viz., (a) schemes based on the issue of shares to employees gratuitously or on specially favourable terms, and (b) schemes based on the acceptance by employers of savings or deposits from employees at a rate of interest varying with the profits. In such cases the bonus is a sum varying with the value of shares held or with the amount of savings or deposits received, and does not necessarily bear any relation to the wages or salaries of the employees concerned. 24335 186 RATIO OF BONUS TO WAGES.* No. of 1 No. of No. of Ratio of Bonus to Wages.* SchencF which the par- ticulars relate. No. of I'artici- { pantH. i 1 1 Schemes to which the jiiir- ticulars relate. No. of ! Partici- ' panty. \ i Schemf s to which the par- ticulars relate. No. of Partici- pants. 1901. 1902. 1903. Nil 7 1 t 8 t 9 t Under 1 per cent ' — 1 113 1 119 1 and under 2 per cent. ... 3 141 1 — — 2 334 2 .. ..3 7 l.HOl , 6 620 7 819 3 „ ..4 9 4,702 , 8 419 7 880 4 .. .,5 8 1 '.(28 ! 6 2,273 4 814 5 .. „ 6 ., 7 I 2,046 ' 10 2.066 6 2,283 6 ., „ S 4 ! 742 5 4,8-7 7 6,077 8 .. ,. 10 3 73 ■ 2 110 1 108 10 ., .. 12 2 362 5 455 3 163 12 ,. ., 16 3 1 1,479 1 1.361 1 28 16 ,. .. 20 — — — — — — Over ■-'(• per cent 1 42 i 1 49 2 1,442 Total 54 11,816 53 12,343 50 13,067 Average Ratio J 1 5-0 per cent. 5"9 pe] r cent. 6'8 per cent. 1904. 1905. 1906. Nil 12 t 6 t 9 + Under 1 per cent — — — — — — 1 and under 2 per cent. ... 5 1.09.3 4 6U9 4 862 2 ,. ,.3 ■> 2.813 6 3,049 6 3,024 3 „ „ 4 6 ] ,260 6 656 4 492 4 ., ..5 6 869 6 1,147 6 1,075 5 .. .. 6 4 1,946 7 1,905 8 1,994 6 .. ..8 6 1.4 0.5 5 1.459 6 1,837 8 .. .. 10 3 5,132 3 5,046 3 5,435 10 „ ., 12 2 170 5 2,812 4 275 12 .. ., 16 1 44 3 206 5 1,205 IG .. ., 20 — — — — 2 1,670 Over 20 per cent 2 1,609 1 53 1 53 Total 52 16,341 52 16,942 1 58 17,922 Average Ratio J 6-5 pe r cent. 6-5 pe r cent. 7-1 pe r cent. * The ratio is based on the wages, not of the total number of employees in the respective firms, but of those only who were covered by the profit-sharing arrangements. t For the number who would have been entitled to participate if a bonos had been paid, tee Appendix C. (i) on p. 189. X Taking into account the number of participants in each case where a bonus was paid, and also (in casts where the bonus was nil) the number who would have been entitled to participate if a bonus had been paid. RATIO OP BONUS TO WAGES, 187 No. of No. of No. of Ratio of Bonus to Wages.* Schemes to which the par- ticulars relate. No. of Partici- pants. Schemes to which the par- ticulars relate. No. of Partici- pants. Schemes to which the par- ticulars relate. No. of Partici- pants. 1907. 1908. 1909. Nil 8 t 10 t 10 t Under 1 percent. ... 1 1,100 i 1 1,100 2 1.62? 1 and under 2 per cent. ... 3 559 2 247 o 2,180 2 . ., 3 6 627 7 15,347 5 235 3 , V 4 6 8,131 6 2,470 9 18,460 * . o i 4 728 5 1,141 10 957 5 . ., 6 5 1,956 i J2 3,959 13 4,5U7 6 , .. 8 11 7,594 ; 9 7,541 12 8,285 8 . „ 10 2 228 ; 1 78 1 50 10 . .. 12 4 1,087 5 222 2 39 32 , ., 16 2 89 1 3 1,899 2 1,854 16 , „ 20 2 1,766 — — 2 634 Over 20 per cent 1 56 i ' 55 1 59 Total 55 18,921 ; 62 34,059 71 38,881 Average Ratio t 6-0 pe r cent. 4'5 pe r cent. 4-8 pe r cent. 1910. 1911. 1912. Nil 9 t 17 t 16 t Under 1 per cent 2 315 2 399 1 280 1 and under 2 per cent.... 6 3,471 3 2,322 4 858 2 .. ,.3 4 207 2 207 6 3,079 3 ,. „ 4 11 10,894 11 10,657 13 1,742 4 ,. ,.5 10 18,974 H 2,310 10 11,122 5 ,. ..6 16 2,869 12 19,220 17 21,796 6 .. ,8 16 3,289 25 5,817 21 4,418 8 ,, .. 10 7 8,342 6 7,610 4 7,311 10 „ .. 12 2 42 4 2,660 5 507 12 ,. „ 16 1 ! 1,885 3 145 5 4,077 16 ,. ., 20 1 112 — — — — Over 20 per cent 1 61 1 66 2 67 Total 86 50,461 100 1 51,443 1 104 55,257 Average Ratio X 5-0 per cent. r>-5 per cent. 1 5-8 per cent. * The ratio is based on the wages, not of the total number of employees in the respective firms, but of those only who were covered by the profit-sharing arrangements. t For the number who would have been entitled to participate if a bonus had been paid, see Appendix C. (i) on p. 189. t Taking into account the number of participants in each case where a bonus was paid, and also (in cases where the bonus was nil) the number who would have been •entitled to participate if a bonus had been paid. 24335 G i 188 RATIO OF BONUS TO WAGES. lliitio of Mouiis to Wages. No. of Schemes to which the par- ticulars relate. No. of Partici- pants. I No. of Schemes to which the par- ticulars , relate. No. of Partici- pants. I No. of Schemes' to which the par- ticulars relate. No. of Partici- pants. Nil Under 1 per cent. ... I and under 2 per cent. 2 4 5 6 8 10 12 16 10 12 16 20 Over 20 per cent. Total Average Ratio X 1913. 16 t ; 1 247 6 343 7 3,307 6 1.504 18 2,891 15 14,917 25 23,797 8 9,731 6 2,358 2 801 1 15 2 64 113 59,975 5*9 pel r cent. 1914. '1 II 18 1 + 1 1 235 4 502 9 4,362 9 1,851 1 11 1,700 l| 23 15,945 I' 24 25,783 M 10 9,015 ' 2 219 5 6,336 2 1,147 3 76 121 67,771 6' 7 pel " cent. 1915. 7 1 2 4 13 13 12 22 4 4 4 3 1 t 4 lis 460 31,585 2,134 6,416 12,411 1,088 3,204 5,051 1,007 15 90 63,488 5"3 per cent. 1916. Nil ... Under 1 per cent. . 1 and u nder 2 per 2 ., 8 3 „ » 4 4 .. 5 „ ,, 6 6 ,. 8 8 .. 10 10 „ ,, 12 12 ,. 16 16 „ 20 cent. 11 5 8 18 14 11 10 2 1 6 3 Over 20 per cent. Total Average Ratio X 9,740 9,404 4,087 2,801 3,566 2,2.56 895 55 8,936 1,588 2,112 191' 1918.11 9 4 4 6 20 10 t 10,007 460 2,553 12.611 2,171 3,188 3,428 1,356 201 5,835 3,889 :!.5(i7 17 6 6 9 9 3 2 8 7 7 9 2 8 94 45.440 94 49,2(16 93 t 2,248 9,734 590 1,246 224 401 2,656 1,806 2,817 8,003 1,001 4,427 35,153 4"G per cent. ' 5-3 per cent. •1 per cent. * The ratio is based on the wages, not of the total number of employees in the respective firms, but' of those only who were covered by the profit-sharing arrangements. t For the number who would have been entitled to participate if a bonus had been paid, .tee Appendix C. (i) on next page. J Taking into account the number of participants in each case where a bonus was paid, and also (in cases where the bonus was nil) the number who would have been entitled to participate if a bonus had been jiaid. II For details of distributions in 1918. .ser Appendix C. (ii) on next page. RATIO OP BONUS TO WAGES. 1,S9 Appendix C. (i).— Ratio of Bonus to Wages Summary for Period 1901-18. Year. Number of schemes to which the particulars relate. Number of Employees Participatine (in Entitled to oases where a Partu-ipate (in bonus was paicb. '^t^'-'^ ^'""■® *.V® ' bonus was nil). 1901 1902 1-903 1904 1905 1906 1907 1908 1909 1910 1911 1912 1913 1914 1915 1916 1917 1918 11,816 12,343 13,067 16,341 16,942 17.922 18,921 34,059 38,881 50,461 51,443 55,257 59,975 67,771 63,488 45,440 49,206 35,153 Average for ~\ 1901 -1918/ 78 36,583 1,703 2,276 1.71)0 1,, « n 2 566 401 2,032 6 „ „ 8 „ 8 3,187 2,656 14,800 8 „ „ 10 „ 7 6,759 1,806 20,622 10 „ „ 12 „ 7 4,294 2,817 26,804 12 „ „ 16 „ 9 8,383 8,003 76,931 16 „ „ 20 „ 2 1,503 1,001 15,856 Over 20 per cent. 8 5,833 4,427 77,448 Total 93t 83,210 35,153t 262,476 Average ratio of bonus to wages, taking into account the numlier particupating (or entitled to participate) in each case = 5"1 per cent. * The number entitled to participate in schemes in which the bonus was /^/ was 29.777. . , • r , t I'hese figures relate to those schemes only ni which the nrlio ot bonus to wages can be given. The nmount of bonus is known in twelve other cases. The total amount of bonus paid in 1918 in these 105 schemes was £299,728 ; it was paid to 52,056 participants (excluding those entitled to participate in cases when- the bonus was nil, who numbered 29.777). For further particulars, .^y^ p. 23 above. 24335 ^ 3 190 PROFIT-SHARING IN FARM SETTLEMENTS. APPENDIX D. PROFIT-SHARING IN FARM SKFILEMENTS BELONGING TO BOARD OF AGRIOULTURE AND FISHERIES. The Board of Agriculture ami Fisheries iuive introduced, experimentally, a profit-sharing scheme tor ex-Service men, at certain of their farm settlements. These settlements are at Patringtou (Yorkshire), at Pembroy (South Wales), at Rolleston (Nottinghani.shire), at Amesbury and Berwick St. James (Wiltsliire), and at Wantage (Berkshire). The profitr-wharing scheme provides that, after payment of all working expenses {i.e., interest on capital, rent, rates, repairs, etc.), and the allocation of 20 per cent, of tlie annual profits to a reserve fund, formed for the purpose of meeting losst^ and maintaining a yearly dividend, the remaining net profits on the farm are divided between capital, manage- ment, and labour, in proportion to the amounts that have been paid out to theni in the " Working Account." Each Michaelmas the produce and stock in hand is valued by an inde- jw-ndent valuer, to determine the annual profit. The dividend duo to capital is divided between the settlers and the State in proportion to their restJoctive cx>ntributions fx> the " Wording Capital." The dividend due to v)a,nu(jcinent is allocated to directors, assistant directors, and their staffs ; and to the State, in respect of administrative costs at the Head Office. The profits allocated to labour are divided among the settlers in propor- tion to the amounts paid out to them during the year. A settler is not allowed to share in the profits until he has worked for six months on probation; and the proportion of the profits corresponding to the earnings of casual workers, or of workers who have not completed the six months' probationary i>criod, is carried forward. The Director of each settlement has power to dismiss a settler if he proves unsuitable, on giving the usual notice. Settlers are allowed to invest any of their dividend or other capital in the working capital, receiving interest at the rate of five per cent., and also the dividend due bo capital, as above, under the scheme for the distribution of the profits. A settler's " share " may not be sold, except to the Board of Agriculture and Fisheries, who will take it over at par, either (i) on fourteen days' notice, (ii) on his death, or (iii) on liis leaving the settlement. Except at Patrington (where 48 ex-Service men are now employed), the scheme is of very short standing, and cannot bo said to have passed the experimental stage. At Patrington, the balance sheet for the eighteen months ended Michaelmas, 1918, showed a profit; but only one ex-Servico man had served the six months' probationary period, qualifying him to participate. RULES OF CERTAIN PROFIT-SHARING OR CO-PARTNERSHIP 191 SCHEMES. APPENDIX E. RULES OF CERTAIN PROFIT-SHARING OR CO-PARTNERSHIP SCHEMES. All the rules quoted in this Appendix, with one exception (one of the anonymous schemes) relate to schemes actually in force at the present time. An endeavour has been made to give a representative selection of rules relating to various industries, and to several types of scheme (cash bonus schemes, savings or deposit schemes, and shareholding schemes). (i.) Sir W. G. Armstrong, Whitworth and Co., Ltd. Bules of Employees' Deposit Fund. 1. Amount.— Deposits of not less than one shilling and not more than one pound of the depositor's weekly wages will be received from persons in the emjoloy of the copipany each week. The amount agreed upon will be kept off through the wages sheets. 2. Ofl&cials who are paid quarterly may deposit sums of not less than one shilling and not more than two pounds per week. The amounts must be handed in at the Cashier's Office of each department. 3. In the case of employees paid weekly, the total amount which may be deposited is £200. In the case of those paid quarterly, the total is £400. 4. Interest and Bonus. — A fixed sum equal to 4 per cent, per annum will be allowed as interest on all deposits, and will be added to the depositors' accounts at the end of June and the end of December in each year, except in the case of such depositors as may give notice of their intention to with- draw the interest in cash. 5. In addition to the fixed rate of interest, a bonus will be declared each year equal to half the difference between the fixed rate of 4 per cent, and the dividend payable on the shares of the company. As in the case of the fixed interest, this bonus will be added to the depositors' accounts unless they give notice of their intention to withdraw it. 6. Sums withdrawn will be entitled to only 4 per cent, interest from the 31st December preceding up to the date of repayment. They will, however, be entitled to their proper I ion of the bonus up to the said 31st December preceding. 7. No interest or bonus Avill be allowed on sums of less than t<^n .shillings, or in respect of any period less than one calendar month. 8. Deposit Books. — All sums deposited with the C-onipany will be entered in a deposit book. On a date which will be duly announced, this book will be handed to those depositors having time boards, at their respective time offices, by one of the company's staff, and on production by the de- positors of their time boards. 9. In order to be written up, all deposit books must be returnetl at the time offices once in each month, to one of the company's staff apixiinted to receive them, and on a date which will be duly announced. 10. Those officials who have not time boards will receive their deposit books direct from the account branch and must return them there each month. 11. Bepayments and Withdrawals.— Deposits will be lepaid or may be withdrawn as follows : — Up to one-half on seven days' notice. The whole on fourteen days' notice. 24335 ^ ^ r.»2 RULES OF CERTAIN PROFIT-SHARING 12. IimIci' siHHial will aj)ply on and after January 1st, 1903. 16. The Board of diraid during that year in wages and salaries, other than to the directors and managing directors, so that in any year when 10 per cent., free of tax, is received as dividends by the shareholders, there shall be set aside for the employees of the company a sum equal to 10 per cont. of the total sum paid in wages and salaries during that year, and, further, that for each 1 per cent., free of tax, above 10 per cent, distributed as dividend, there .shall be set aside an additional sum of 1 per cent, upon the total wages and .salaries. 3. That when, after payment of dividends at the rate of 6 per cent., free of tax, any portion of the profits are placed to re.serve, an amount equal to that which would have been set aside, if such profits had been distributed in dividends, shall be placed to a special reserve for the collec- tive benefit of the employees. OR CO-PARTNERSHIP SCHEMES. I'j;^ 4. That a consultative committee be formed of employees of the com- pany, of whom not less than half shall be workmen, for the purpose of administering the funds thus set aside, and of considering all matters re- lating to the general welfare of tiie employees of the company, including the equitable adjustment of tho minimum wage to the cost of living, with power to make recommendation to the board of directors. 5. That suitable machinery shall be established for regulating relations between the board and such consultative committee. 6. That the general principle governing the distribution of the sums thus set aside shall be to increase the productivity of lalwur by improving the working and social conditions of the employees and, inter alia, (a) By distributing a portion in cash over the succeeding year, by weekly payments based upon regular attendance, and"bv pay- ments periodically as a reward for efficient woik, subject to a minimum period of service in the employment of the Company. (h) By placing the remainder to a fund administered for the collective benefit of the employees. Constitution and Functions of Consultative Committee. 1. That the consultative committee consist of nine meml>ers. 2. That the managing director be ex-officio chairman of the consultative committee. 3. That the works manager be a permanent member of the consultative committee. 4. That the consultative committee shall appoint as permanent secretary a member of the clerical staff of the company, who shall be paid a salary from the funds at the disposal of the committee. 5. That of the seven members of the consultative committee, other than the chairman and works manager, two be elected from the staff of the company, one be a foreman and four from the workmen. N.B. — It is understood that foremen are to be regarded as workmen, and therefore are eligible for election as workmen members. 6. That the staff representatives be elected by the staff, the foreman by the workmen, and the workmen representatives by the workmen, in the manner set out below: — (a) The foreman member shall be elected by the workmen from both works by ballot, from a list of the foremen issued annually by the works manager. (b) Any workman above 21 years of age who shall have been continually in the employment of the firm for two years prior to the first day of the year in which the election is held, excepting only the foreman elected as the foreman member, shall be eligible for election as a workman member. (c) Of the four workmen members two shall be elected from each works. {d) Any ten workmen may nominate one workman member for the committee, such nominations to be ballotted for by general ballot, (e) Each workman shall only sign one nomination paper, such signa- tures to be made clearly, and in the event of any man not being able to sign his name his mark must be accompanied by his foreman's signature as witness. (/) The two names from each works receiving the highest number of votes in the general ballot, together with the foreman elected as above, shall constitute the workmen's section of the com- mittee. [g) For the purpose' of electing workmen members of tlie committee. every workman who has been continually in the employment of the firm for three calendar months prior to the date of election shall be entitled to four votes. 7. That for the election of the staff similar procedure be adopted as for the workmen, but for each nomination sent in, only four signatures will be necessary, and each member of the staff shall have two votes. 194 RULES OF CERTAIN PROFIT-SHARING 8. That tlio two elected members of the staff, the foreman, and two of the four workmen members shall retire annually from the committee, but shall bo eligible for re-election. Tho two workmen members remaining on the committee for the second year shall be the one from each works who received the highest number of votes, or, in the event of equality, shall be chosen by lot. 9. That meetings be held every throe months between two members of the committee elected by the committee and two members of the board of directors, alternately in London and Oldbury. 10. That in the event of the committee desiring to discuss a special point with the board of directors, tho committee shall elect two of its members for the purpose of meeting two members of the board of directors, and shall instruct the secretary of the committee to write to the secretary of the company asking him to lay the matter before his board in order that a meeting may be held at an early date at the convenience of the directors. 11. That at such meetings the managing director shall not be a repre- sentative of the board of the company or of the committee, but either party may invito him to be present in an advisory capacity. (iv) Messrs. Eva Brothers. Profit-sharing Scheme- In order to further the interest of our employees in tho welfare of this business, and to promote the mutual goodwill and hearty co-operation between employers and employed which will be so necessary in the days to come, we have inaugurated a jirofit-sharing scheme for the benefit of our regular servants. Share of Profits. — We earmark a definite proportion of our net profits for the benefit of our employees. This proportion as well as the definition of tho term " net profits " is known only to ourselves and our auditors (Messrs ), who will certify from time to time the amount due for division under this scheme. Time of Payment.- — ^The profits are payable quarterly, towards the end of the quarter following the one in which they are gained. Beneficiaries and Qvbalifications. — The beneficiaries are all our em- ployees with six months' continuous service, and full completion of the current quarter's service. The amount of profits for division is equally divided amongst the total number of beneficiaries, irrespective of earnings, each employee thereby receiving the same share. Up to the age of 18, each beneficiary receives only one fourth part of a full share. Tribunal. — A mixed tribunal has been instituted, consisting of three employers or persons appointed by them, and three or more employees, who settle all points of difference arising in the working of this scheme. I'n case of non-agreement of the tribunal, our solicitor shall decide. Duration of Scheme. — As this division of profits is in tho nature of a free gift by us, involving no extra obligation on tho part of our employees, we retain the right to amend it or cancel it at any time with or without notice. (v) WiLLTAM Gray and Companv (1918), Limited. Bules of Profit-sharing Scheme. 1. The Trustees shall be appointed as follows: Every trade or section in each of the yards and /or woi-ks of the Company shall elect a representa- tive, and the representatives so elected shall meet together and elect the Tru.stee for the yard and /or works, who shall be an employee of the Company. The Trustees shall appoint some other employee of tho Com- pa/zy, which appointment must have and continue to have the approval of the Directors of the Company, to act as Secretary, and the remunera^ tinii of such Secretary, the whole of whose time shall, if required, b© OR CO-PARTNERSHIP SCHEMES. 195 devoted to this work, shall bo paid by the Company. The reasonable remuneration of the Trustees, to be fixed a^ to amount by the Directore, shall also be paid by tho Company, 2 This Agreement shall, as hereinbefore limited, bo operative in the first instance for the years 1919, 1920 and 1921, provided always that in the event of the Government passing legislation involving profit-sharing, co-partnership or restriction of profits other than by means of the Excess 1 rofits Duty, the Directors retain the right to withdraw the Agroomont, and in the event of such withdrawal the divisible profits :i,s hereinafter defined shall be calculated to the date of tho withdrawal. Tho Agreement may be renewed for a further period by the consent of lK>th parties. 3. The net profits of the Company, after the Directors shall have made what, in their sole opinion, are the necessary allocations, shall be divided, subject to the provision in Clause 10 hereinafter contained, as to 80 per cent, to the Shareholders of the Company and as to 20 per c-ent. to the employees, which latter amount shall for the purposes of this Agreement be deemed as the divisible profits under this Agreement. 4. Every man and woman in the Company's employment who has attained the age of twenty-one years, and who has been in the employment of the Company not less than twelve calendar months, shall, with the exception of the Directors of the Company, be deemed to be employees for the purposes of this Agreement, and subject to certain qualifying con- ditions hereinafter stated, shall participate in the divisible profits. 5. Employees who have without good and sufficient reason lost more than twelve days' time during any year shall not participate in the divisible profits. To enable a correct record of time to be kept every employee must take out a card, time-board or check. 6. An employee shall not, for the purposes of this Agreement, be con- considered to have lost time (a) through absence during recognised holidays, (h) when sick, provided a satisfactory medical certificate be furnished to the timekeeper, (c) when in the opinion of his foreman or yard manager the weather shall prevent work, (d) when in the opinion of his foreman or yard manager there shall he insufficient material to hand, a breakdown of plant or machinery, or for other reasons the man's job was not ready for him, (e) ^\hen given leave of absence by his foreman or yard manager for any definite purpose. 7. An employee le;iving the firm, provided he was not disclia,rgon(lliost relationship with the Trade Unions, but, if possible, to imi)r()vo that relationship. Time lost by reason of a strike on a seal© smaller than a district striko shall be considered as wilful loss of time, and th(( days so lost shall bo counted under the conditions of Clause 5 hereof. 13. The Trustees may demand a Certificate of the Company's Auditor or Auditors as to the exact amount of divisible profits available for dirision amongst the employees under this Agreement. 14. Divisible profit due to men who cannot be traced within twelve calendar months from the date of distribution shall bo paid into a special* reserve fund, which fund shall be available to meet any unexpected or late claims, and shall be carried foi-ward to the following year. The fund will then bo administered by the Trustees. lo. If an employee who is entitled to a share of the divisible profits shall die during the currency of a year the whole of the amount due to him or her up to tlie date of death shall be paid to his or her next-of-kin. 16. Any dispute or difference betwcnm the parties hereto arising under this Agrement .shall (except as aforesaid) be referred to an Arbitrator to be mutually agreed between the Directors of the Company ftnd the Trustees, and the award of any such Arbitrator shall be binding and con- clusive on both parties, and the provisions of the Arbitration Act. 1889, shall apply to any arbitration under this clause. (vi) K. S. MUBR.W .4NU Co., LlMITHO. Bonus Scheme. In order to encourage diligence and to give the workers a direct interest in the Company's prosperity the Directors have decided to give a bonus to all their workers who have been in the regular service of the Company for twelve months previous to the 30th June in each year, commencing from the Lst July, 1912, and qualified in accordance with the rules and regulations set out hereunder, and they hope this step will increase the feeling of goodwill and loyalty of the workers and also tend to greater efficiency and carefulness, with the result that preventable waste of raw materials, finished goods, fixtures, and plant will be reduced to a minimum. The bonus payable will be based upon the amount of the ordinary dividend declared in each year as follows: — After payment of six per cent, on the ordinary shares, for every additional one per cent, paid to the ordinary .shareholders one per cent, will be paid to the workers, and the total sum this amounts to Avill be credit-ed to the total wages account of the workers; and the percentage that sum bears to the total wages paid will be the percentage payable to each v.orker who has qualified. In order to qualify for participation in the bonus the following rules and regulations must have been observed and obeyed: — Bules. (1) Each worker must have been in the employ of the Company con- tinuously for twelve months commencing 1st July of one year till 30th June of the next year, and be still in their employ at the time the bonus is distributed. (2) Any worker who has been absent from work for any period during the twelve months without the express permission from the Company will not be eligible to participate in the bonus. (3) Any worker who has voluntarily quitted, or has been dismissed, the Company's service during the year — even should such worker be subsequently re-engaged during the period of the twelve months — will lose all rights to particijjate in the distribution for that year. (4) All workers must have observetl all the rules and regulations as set out in the brwk of rules governing their employment as handed t^) and agreed to by them on entei'ing the Company's service OR CO-PARTNERSHIP SCHEMES. ]f)7 The Directors reserve discretionary power to uaive the disqualification ot any worker who has been absent through illness, slackness of trade, or any other cause over which lie or she has no control ; but in the case ©f workers put off through slackness of trade, should they not return to work when requested to do so, they forfeit all right to participate in the konus, and shall be absolutely barred from doing so. No worker shall be able to qualify for participation in tbe bona., who IS paid wholly or in part by commission or bonus. The accounts of the Company are made up from the 1st Feln-uary to the Jlst January in every year, the result being known, and the bonus (It any) distributed, in the beginning of April. The Directors will not allovv any question as to the accuracy of the accounts, the certificate of the Company's auditor as to the dividend earned being conclusive. This bonus scheme being entirely a voluntary and free gift by the Directors to the workers, they reserve the right to withdraw or amend it at any time by giving twelve months' notice in the month of Febi-uarv in any year of their intention of so doing. (vii) S. P. Myers and Co., Limited. Einployees' Propt-Sharing Scheine. 1-- — The Company have determined to adopt a scheme for sharing profits with certain of their employees, who are hereinafter called " Participating Employees." 2. — The scheme is intended to take effect as from 1st January, 1919, and will be in accordance with the details hereafter set forth, subject to variations which may from time to time be made by resolutions of the Company in general meeting. 3. — The participating employees will include all persons (male or female) in the permanent and exclusive employ of the Company, except: — (o) Those who are remunerated entii'ely or partly by commission on profits ; (b) Those whose remuneration from all sources exceeds £500 per annum ; (c) Any employee who has not been employed by the Company for a full period of 12 calendar months preceding 31st December of each year. 4:. — It is intended that the net profits of the business in each financial year — after providing for depreciation, reserve fund, remuneration of governing and other Directors, commissions to jaersons entitled to com- missions on profits, interest on mortgages and loans, income tax, excess profits duty, preferential dividends, and other outgoings — shall be applied in payment of a dividend at the rate of five per cent, per annum on all ordinary shares and employees' shares for the time being issued, and that the surplus shall be applied in payment of a bonus to participating employees and of further dividends on the ordinary shares and employees' shares in such manner that the bonus on wages and the furthei- dividends on shares shall be at the same rate per cent. The bonus to employees in each year will be apportioned on the following basis, namely : — (a) Employees of from one to ten years' standing to rank for their last year's wage or salary. (h) Employees of from ten to twenty years' standing to rank for one and a half times the last year's wage or salary, (c) Employees of over twenty years' standing to rank for double the last year's wage or salary. 198 RULES OF CERTAIN PROFIT-SHARING 5. — 'The bonuses payable to participating employees will, at the difi^ cretion of the Directors,* be paid in cash or applied in paying up employees' shares of £1 each to bo issued to participating employees. Fractions of £1 will be placed to the credit of the employee entitled thereto and carried forward to the next bonus distribution. Any bonus which accrues in respect of the wages of a participating employee whoso employ- ment commences or determines during the currency of a financial year will not i)e paid to such omjjloyee but will bo j)la<'ed t-o the credit of an Employees' llenefit Fund in the books of the Company, and whilst to the credit of such fund interest at the rate of five i>er cent, per annum will be added thereto. 6. — Euiployees' shares may, if required by an employee and subject to the approval of the Diirectors, be is.sued at par to any persons in the employ of the Company although they may not be participating employees within the definition above set forth, but no employee will be allowed to take employees' shares of a larger nominal value than the bonus which he would have received on the basis above set forth for the period of employment if he had been a participating employee. 7. — Employees' shares will be of the nominal value of £1 each, will be fully paid up, and will rank for dividend along with the ordinary shares. In the event of a winding up, the shares rank for return of capital with the ordinary shares until the full amount of 20s. per share has been returned, but they will not be entitletl to any part of the surplus assets( if any). 8. — Employees' shares will not confer a right to vote, or to receive notices of or attend at meetings of the Company, or to inspect or require particulars of balance sheets or reports. 9. — An employee will only be entitled to retain his employees' shares so long as ho remains an employee of the Company, and if by death, resigna- tion, withdrawal, dismissal, or otherwise, he ceases to be employed by the Company, he or his executors or administrators must within six calendar months after such emi:)loyment cea.ses, or such further time as the Directors may for special reasons allow, transfer the share to some other employee of the Company or to somo other person nominated and approved by the Directors. In default of such transfer being effected within the time named the Directors will be at liberty to cause the share to be transferred to any penson nominated by them at any price they may think fit. In every such case the shareholder or his executors or administrators wiU receive oidy the amount paid for the share and will not be entitled to question or dispute the transaction. 10. — To assist an employee shareholder, his executors or administrators in effecting a sale of any share or shares the Directors propose to allow a notice to be exhibited in a suitable place in premises occupied by the Company setting forth the number of shares for sale and the name and address of the holder. 11. — An employee holding employees' shares will be at liberty to transfer to any other employee or to any person approved by the Directors any of his shares .so long as he continues to hold employees' shares equal to one full year's salary, wage or remuneration at the rate prevailing at the date of the proposed transfer. 12. — The Directors may at their discretion su.spend or postpone the transfer of any employee's share for a period of six calendar months after the determination of his employment — the object being to discourage employees from leaving the Company for the purpose of realising their shares. 13. — An Employees' Benefit Fund is proposes! to be created, which wiU be administered by the Directors at their discretion for the benefit of the employees of the Company. All money carried to the credit of the Employees' Benefit Fund will be entitled to interest at the rate of five per cent, per annum whilst the fund is retained by the Company. Betcmber ^\st, 1918. * For the present it is the intention of the Directors to apply the honus in paying up employees' shares. OR CO-PARTNERSHIP SCHEMES. 199 (viii) E. S. AND A. Robinson, Limited {two schemes). Bules of Profit-sharing Scheme (dated March 31st, 1919). 1. At the conclusion of each financial year the Directors will set aside for distribution among the workpeople ot the Company a certain fixed proportion of the amount (if any) by which the clear profits of the Company's business for that year, excluding any profit or loss on the sale of plain papers and other goods not printed or manufactured in any way by the Company and excluding any profit or loss on the business of any subsidiary company, exceed a certain fixed minimum sum. 2. Distributions under this scheme will take place as soon as practicable after the Company's accounts for the year have been completed and audited, and tlio amount for distribution ascertained.. 3. If the profits of the Company for any financial year do not exceed the fixed minimum sum referred to in Rule 1 there will be no share of profits available for the workpeople, or should the amount available for division be lees than £500, it will not be divided but carried forward to the following year, and for all purposes of these rules will be considered as earned during such following year. 4. The sum available for distribution will bo divided between the employees entitled to share in proportion to the actual earnings of each employee during the year, plus £1 for each completed year of uninterrupted service, calculated up to the last day of the financial year for which the distribution is made ; that is to aay, an employee earning £100 in the year and having been in the employ of the Company for 10 years would receive profit-sharing based on £110, or if 20 years' service on £120 and so on. 4. (a) The Directors reserve the right to pay any money due under this scheme in cash, in shares of the Company, or in Government Securities. 5. No employee will participate who has not been continuously in the employ of the Company for the two years immediately preceding the last day of February on which the financial year ends in respect of which the profits are divided. 6. No employee, the average rate of whose wages during the year when employed exceeds £6 per week, will participate in the division of profits for that year. 7. No employee who is dismissed or leaves for other employment before the end of the Company's financial year will participate in the division of profits for that year. But, (a) Any girl otherwise qualified to participate, who, having worked three months or more during the Financial Year, leaves to be married, shall participate in proportion to her earnings for each completed quarter of employment. (5) Any employee otherwise qualified to participate, who, having worked three months or more during the Financial Year, retires through old age or ill health, shall participate m proportion to his or her earnings for each completed quarter of employment. (c) Any employee otherwise qualified to participate, who, having worked three months or more during the Financial \ear, shall die shall be entitled to participate in proportion to his or hor earnings for each completed quarter of employment but this provision shall not constitute the amount to which ho or she may be entitled a debt from tho Company, and the Directors reserve the right to pay the money to any person or persons whom they shall consider the most deserving dependent or dependents of the deceased employee. 8. The Directors reserve the right (a) To exclude from the benefit of this Scheme any employee other- wise qualified for any cause, and particularly for carelasanes*. inefficiency or bad conduct. 200 RULKS OP CHRTAIN PROFIT-SHARING (b) To alior tlie toniis of this Scln'iuo or discontinuo it eiitiioly by giving iiotico at any time of such alteration or discontinuance, but such notico unless given before the end of ^lay shall not have effect until the expiration of the then current Financial Year. [). The oinployoes shall neithei- have tlie rights nor be under the liability of partners, and accordingly shall havo no rights to intermeddle with the management or bo entitled to investigate or inspect tho accounts of the business. 10. The decision of tho Directors as to any question of law or fact and as to tho interpretation of these Rules or any question arising tliereunder shall be final and conclusive, and shall bind all pei"sons participating or claiming to participate in the distribution under these Rules. Itnles of Workpeople's Deposit Account Scheme (dated January, 1914). 1. — ^Any person who lias been in the employ of the Company for two years or over and who is api)roved by the Directors may have an account providing his or her salary does not exceed £300 per annum. 2. — No one may pay in more than 25 jjer cent, of his or her wages during the Company's- financial year terminating on the last day in February, nor have more than £'200 on deposit. 3. — No deijosit shall be less than Is. and no withdrawal less than 5s. unless the depositor's balance is below that amount. 4. — Interest at the rate of 5 per cent, per annum (subject to clause 5) will be paid by the Comjiany, and in every year when the rate of dividend paid by E. S. & A. Robinson, Ltd., to their ordinary shareholders exceeds the average of the 4 j-ears ending June, 1905, the rate of interest will be in- creased to the same extent up to a maximum of 10 per cent, per annum ; for instance, if the Company's dividend is 1 per cent, above the average men- tioned, an additional 1 per cent, will be paid to the Depositors, making 6 per cent, in all,, and so on up to 10 i>er cent. This additional interest (if any) will be placed to the credit of the Depositor each year by May 31st, i.e. within 3 months of the close of the financial year. 5.— To encourage permanent savings the interest will bo credited -to each account quarterly (viz., on May 31st, August 31st, November 30th, and last day of February) on the sum standing to the Depositor's credit at the close of the j'l'evious quarter, first deducting therefrom all withdrawals made since that date. In calculating interest any fraction of Id. less than }jd. shall be ignored, but hi. or larger fraction shall be reckoned as Id. 6. — Deposits will be received by the foremen on Saturdays from 12.30 to 1 p.m., and must be handed in by the Depositor, the monej' and i>ass book being in a sealed envelope, with the amount of the deposit marked on the outside or on a slip of paper placed inside the envelope. If desired, deposits may be sent to the Com]>any"s office hj post, and all deposits received in this way will be acknowledged by post to the Depositor's private address on the Monday following. A week's notice must be given to the foreman or by post by anyone desiring to open an account. 7. — Payments in cash will be entered and initialled by cashier in the pass book supplied to the Depositor, and the book will l>e returned to the Depositor early the following week. 8. — "Written notice of withdrawal, together with the pass book, to be handed to the foreman on Saturdays between 12.30 and 1 o'clock, or sent by post. Payment in cash will be made during the following week to the Depositor only and receipt signed b}' him or her. If desired, payment will be made by cheque to the Depositor's private address. The directors reserve the right to lequire two months' notice foi' the withdrawal of any sum exceeding £20. 9.. — As the directors desire to encourage permanent saving on the part of their workpeople they reserve the right by giving notice to close the account of any Depositor who makes withdrawals too fre([uently, and also to close the account of any Depositor for any other re;ison, by, in either case, paying him or her the amount that ho or she would be entitled to in case of leaving as next herein provided. OR CO-PARTNERSHIP SCHKMES. 201 10.— Any Depositor leaving the employ of the Conipanv will be paid the amount standing to his or her credit at that time, together with interest at the rate of 5 per cent, per annum to the date of his or her leaving on the amount standing to his or her credit at the end of the pievions quarter. first deducting therefrom all withdrawals since that date, but will noi participate in any higher rato of interest for that financial year. 11.— Any Depositor losing his or her pass book will be charged (kl. for a new one. 12. — In case of a Depositor's death any amount then standing to the credit of his or her ac-count, and interest to the d and paid to the Executors or Administrators of the deceased person at the rate paid to the Depositors for the Company's preceding financial year, first deducting therefrom any interest already paid or credited to the deceased from the said 1st of March. 13.— The Directors reserve to themselves the right to revise the rules at any time : notice of such revision to be given to the Depositors. 14.. — The Directors may at any time close the accounts of all the De- positors by giving them notice thereof and repaying the amount then standing to the credit of each Depositor with interest, at the iat« of 5 per cent per annum up to the date of closing on the sum standing to his or her credit at the end of the previous quarter, first deducting therefrom all withdrawals since that date. 15. — In case of any dispute arising between the Company and any Depositor as to the meaning or effect of the terms on which deposits are received, the same shall be referred to the Directors, whose decision shall be final and conclusive. (ix) The Soltcitoks' Laav Stationery SociErv, Limited. Staff Profit-Sharing Scheme. Tho Articles of Association of the Society provide that everyone exclu- sively employed by the Society during tho whole of any year in respect of which a dividend exceeding the rate of 6 per cent, per annum is paid to the shareholders, shall receive in respect of such year, for each additional 1 per cent, of dividend so j^aid, a bonus of 1 per cent, on the total amount (exclusive of expeii.ses) paid to him or her during such year as wages, salary, or commission. Thus, if tho dividend of 10 per cent, paid in respect of the year 1912 is maintained, the bonus will be at the rate of 4 per cent. On the recommendation of the directors the society in general meeting has power, except in respect of a past year, to fix a lower rate of payment either in respect of the then current year or of any future years, or generally, or may alter the qualification of tho employees to participate therein, or the system upon which the payments are to bo computed, or may resolve that such or any similar payments be discontinued, either permanently, or for any specified period, or until tho happening of any specified event. No employee of the society shall have any right to investigate the accounts or books of the society, and the deterniinatinn of the direotore in regard to any question arising under or in relation to the bonus shall be conclusive as against the employees of the society. The bonus is payable after the annual general meeting in each year to those who qualify. Employees may, if they wish, allow the amount duo to them as bonus to remain on deposit with the society at simple interest at the rate of 4 per cent, per annum, the principal with interest to date to bo payable to them on any Friday between the hours of 11 a.m. and 3 p.m., except on Good Friday or a public holiday, by giving 14 days' previous notice in writing. {Signed) General Manager and Secretary. 202 RULES OF CERTAIN PROFIT-SHARING The jnnjmcut of bonus i.i made h;/ mranx of the following warrant and covcrinij letter which, it will be noticed, is so devised as to resemble a (locitii\cn't xised in imying a dividend, a form to which the General Manager and Secretary attaches some importance: — No Dear Sir {or Madam), As the dividend declared in respect of hist year was at the late of ... per cont. per annum, a bonus is payaljh) under the Profit-sharing scheme at the rate of ... per cent, upon tlie amount earned, by each employee exclusively employed by the society during the whole of such year. The amount duo to you is £ : s.: d., for which please find bonius warrant annexed. The warrant requires your signature at foot, and may be j^resented for payment at the National Provincial and Union Bank of England, New Court, Carey Street, W.C., or it may be handed to Mr. , the society's accountant, at the head office, in your dinner hour to-day or to-morrow, to 1)0 placed on deposit with the society at 4 per ocnt. simple interest per annum, subject to rules settled by the board and to be obtained from the accountant. The money so deposited will l>e used in the society's business. Income Tax, if payable in respect of this bonus, should be paid by you to the proper officer for the receipt of taxes. Yours faithfully, (Signed) General Manager and Secretary. To Department. THE SOLICITORS' LAW STATIONERY SOCIETY, LIMITED. lao STAFF BONUS WARRANT. Date. To the National Provincial and Union Bank of England, Limited, Lincoln's Inn Branch. Embossed Pay to the Order of ( Cheque \ Stamp. he sum oj. On behalf of the Society. £ Director General Manager and Secretary Employee's Signature This Warrant must be presented within one montli from date. OR CO-PARTNERSHIP SCHEMES. ' 20H (x) South Metropolitan Gas Company. Co-partnership with Officers and Workmen. Object and Details of Working. — To induce all the officers and employees to take a real interest in their work by giving thera a new motive for endeavouring to promote the prosperity of the ooinpaiiy, and (equally important) to give them an opportunity to improve their position in life by saving their annual bonus and becoming owners of property in the stock of the company. By the sliding scale system (established by Act of Parliament) the profit* the company may divide among its shareholders are dependent upon the price charged for gas — for every reduction of Id. per 1,U0U cubic feet the shareholders become entitled, by the (Company's Act of 1900, to 2s. 8d. per cent, additional dividend, and, on the other hand, should the price of gas be raised, the shareholders' dividend is reduced 2s. Sd. jxyr cent, for every penny. It is therefore in the interest of the shareholders that gas should be sold at the lowest practicable price; but .as the Act of Parliament did not apply the principle of the sliding scale to the employees of the company, they consequently had no direct interest in the price at which gaa was sold. Tn order to remedy this defect, the directors, on October 30th, 1889, unanimously resolved to offer to their officers and all workmen who were willing to sign agreements a share in the profits of the company in the form of a percentage on their salaries and wages. The principle of the sliding scale was adopted, the percentage (or bonus) rising when the price of gas is reduced, and falling when it is raised. The initial price or starting point Avith the sliding scale which regulates the dividend of the shareholders is fixed by the Act of Parliament of 1900 at 3s. Id. per 1,000 cubic feet, and the same figure now applies to the Co-partnership scheme. The shareholders get 2s. Sd. per cent, for each penny reduction in the price of gas. The Co-partnership bonus is at the rate of 15s. per cent, on the annual salary of the officers and the year's wages of the workmen for each penny at which gas is sold l)e]ow 3s. Id. per 1,000 cubic feet. One-half of the bonus is invested in the company's Ordinary Stock in the names of the three trustees until the amount credited to any co-partner is sufficient to give him a stock certificate in his own name. The remain- ing lialf of the bonus is left in the company's hands to a-ccuniulate at interest, or it may be invested in stock with the trustees, or it may be withdrawn under special circumstances by giving a week's notice. Scale of Bonus. If the price of gas is at or above 3s. Id. per 1,000 feet— No Bonus. At 3s. Od.— J per cent. At 2s. 5d.—6 per cent. „ 2s. lld.—U „ ., 2s. 4J.-6f „ 2s. 10d.—2l „ ,, 2s. 3d.— 7^ „ 2s. 9d.—3 ,, „ 2s. 2d.— 81 ,, 2s. 8rf.— 3f „ „ 2s. Id.— 9 ,^ 2s. 7d.— 4i ,, ., 2s. Of?.- 9f „ 2s. M.—5i „ Anf^ so «"• liules. 1. Employees working under signed agreements and officers who fulfil the conditions of these rules shall be entitled to the Co-partnership l>onus. The directors reserve the right to refuse permission to any man to sign an agreement who does not take an interest in the welfare ot the company and its Co-partnership, or who is wasteful of the company s property, or is careless or negligent in the perforinanco of Ins duty. 2. The bonus shall be calculated on the salaries of the officers, and the wages of the emplovees, no account being taken ol overtime. Ihose employees who may be employed on piece-work shall have their bonus calcu- lated on the amount they would have earned at their ordinary rat« of wages in the regular working hours. '2()i ni'l.KS OF CKRTAIN I'KOFIT-Sil AH 1 N«J 3. No doduction shall be mndc on account of absoncc caused by sickness, iinlcNs tlio total ;uii()unt of such absence exceeds two months (8 weeks) in ♦ho year, iind then only tho exccBs over that period bhall bo deducted. 4. Tiie bonus year shall ond on tho 30th June in each year and the bonus shall not !>(> declared until that date. It shall bo paid in full to employees disehargod from tho company's service on account of slack- ni>.4i« of work, or in tho event of superannuation or death, for the period such employees have worked under agreement since the previous declara- tion of bonus. Men leaving tho company's service of their own accord before the declaration of the bonus and with the approval of their engineer or suporinti'iident, .shall, in respect of the current year's Ixjnus, ije paid only the withdrawable half cak'ulat<>d on the time they have been under agr(^ement in such year. Should a man bo diiwhargcd for misconduct or breaking the terms of his agreement, ho shall not bo paid bonus for the expired portion of the period of the agreement ho was working under at tho time. 5. On the dtndaration of the bonus on the 30tli of June in each yoar, or in the case of a winter man on the com])leti()n of the term specified in his agreement, the whole of the bonus to which he may be entitled (see Rule 6 for winter men) shall become tho absolute property of the employee. One- half shall be separately entered in his i)a.ss Ijook and invested in the com- ])any's Ordinary Stock, either in his own name or on his behalf in the uanu\s of the three trustees, and the other half .shall be entered in his pass lKK)k to accumulate at interest, but under special circumstances, it may be allowed to be withdrawn upon giving not less than seven days' notice upon a form provided for the purpose. The whole of the bonus, however, may be placed direct to the trust account if any employee notifies the pay clerk or the Co-partnership secretary that such is his desire. Under no circum- stances whatever, except fraud, shall tho declared bonus or any part or any accumulations thereof, whether in the hands of the trustees or in the name of the em])Ioyee, be forfeited. 6. Winter men under signed agreement sha.l be entitled to the full bonus, provided they return in the following winter, and leave the with- drawable half on deposit with the company. If, however, they choose to take the withdrawable half in cash, they are perfectly at liberty to do so, but in that case they will not be entitled to the other half. Should the bonus at any time amount to 10 per cent., the maximum payable to winter men who take payment in cash, viz.. 5 per cent., Avill be reached. Winter men who leave their bonus with the company and who do not return the following season can, on application to the Secretary, obtain payment of the withdrawable portion to which they were entitled when leaving, plus the usual interest. 7. The committee shall appoint three trustees, one director, one oflScer, and one co-partner workman, in whose names the half bonus and any interest, savings, or transferred amounts added thereto shall be invested annually in the company's ordinary stock. If the amount so accumulated by any employee be sufficient for the allotment of £10 or more of stock, the trustees .shall transfer such amount to hmi. In the event of leaving the service of the company or on the death of any depositor the trustees shall pay to him or to his representatives, in accordance with Rules 5 and 11, whatever money may be standing in his name in their hands, but under no other circumstances shall any money be withdrawn from the Trust Account. The committee shall be authorised to devote out of any year's bonus a sum of money not exceeding £'100 for the purpose of pro- moting the objectvs of Co-part nershi]>. 8. Interest at the rate of 3 per cent, per annum shall be allowed on all amounts, excluding fractions of a pound, accumulated with the company. It .shall be calculated up to June 30th in each year, but shall not be given for an incomplete month. 9. The cempany will receive and add to his account .such amounts as any employee may deposit as savings, and on all such sums interest shall be paid as per Ride 8. 10. The company will, on the application of any of their employees, make arrangements for the transfer and investment of any sums to their OR CO-rARTNERSHIP SCHEMES. 205 credit in the withdrawable account or any other money they may aesire to invest, into the stock of the company. Any employee selling stock purchased through co-partnership, without the consent of the secretary of the company, or pawning or pledging the same, will at once cease to be a co-partner, notwithstanding any agreement he may have signed. No •o-partnership system can endure unless it continues to fulfil the objects for which it was founded ; therefore those co-partners wlu) do not en- deavour to promote the welifare of the company and of co-partnership, and who sell, pawn or pledge stock or withdraw bonus except as allowed under special circumstances shall be struck off the list and not be ])ermitted to renew agreements. They may, however, again become (pialified after the lapse of two years if during that period they liave taken an active interest in the prosperity of the business and have Foi-oman or Forewoman in charge. 4. The hours of working to be 48 per week. 5. The Company undertakes that during the continuance of this Agree- ment the various rates of wages in force at the date hereof, and which, under Clause 2, may become payable to the said Employee, shall not be reduced. 6. The said Employee .shall be entitled to the benefits and be bound by the rules and conditions of the Co-partner.ship so long as he/she shall continue in the service of the Company under Agreement. As witness the hands of the parties, For and on behalf of the South Metropolitan G-as Company. No obstacle will be placed in the way of any employee engaged under the- above Contract who may wish to leave the Company's employment before the expiration of the period of service therein specified, provided he or she shall notify such wi.sh to the Engineer of the Station, or Superin- tendent of the Department at or in which he or .she may for the time being be employed. On receipt of such notice the Engineer or Superin- tendent shall, in his or her discietion. consider whether the services of such employee can be disj>ensed with without detriment to the Company, and, if .so, permission will be given to leave at the expiration of the usual week's notice. An Agreement may be revoked, at the discretion of the Lady Superintendent, if motherhood causes a woman's continu- ance at work to be inexpedient. OR CO-PARTNERSHIP SCHRMES. 207 (xi.) Spili.ees Milling and Associated Industeies, Ltd. Bules of Staff and Workmen's Savings Bank (as amended in 1910). 1. Any employee of the comijany may become a depositor on signing the Application Form provided for the purpose. 2. The cashiers at the company's offices at Bristol, and other places, are L!,uthorised to receive monies from dejoositors for transmission to the Head Office, in sums of 10s. or multiples of 10s. 3. Depositors may pay to the Company's authorised collectors, for whom the company will be responsible, amounts of Is. or multiples of Is. not exceeding 20s. at any one time. The depositor must initial the entry of the amount in the collector's book, and the collector will initial the depositor's card, which will be his receipt for the money paid. When the total amount paid by a depositor to a collector reaches 20s. it will be transferred to the depositor's personal account in the Savings Bank books. 4. Interest at the rate of four per cent, per annum on every completed pound will be added to the account at the end of the financial year, the last day of February. 5. The amount standing to the credit of a depositor must not at any time exceed £100. Wlien this sum is reached the employee wishing to deposit further sums may pay such sum to an ordinary deposit account with the company at the usual rates of interest. 6. If the company sha,ll pay in respect of any year of the company's working a dividend on its ordinary shares at a rate exceeding 4 per cent, per annum on the nominal or face value of such shares, the depositor, if at the time of the distribution of such dividend still in the employ -of the company, will be entitled to receive in respect of such year further interest at the rate of one-half per cent, per annum for every one per cent, -of dividend in excess of 4 per cent, and up to 10 per cent., but in no case shall such extra interest exceed 3 per cent. 7. One month's notice in writing from the depositor (on the form provided for the purpose) of intention to withdraw all or any part of the amounts deposited shall be given to the Company's Accountant at the Head Office, but a deposit-or will be permitted to withdraw once in any one week a sum not exceeding £2 on giving two days' written notice to a collector or cashier at the branch. 8. A depositor withdrawing any money must produce his pass book, or •collecting card, in order that the withdrawal may be recorded therein. 9. Depositors must send their collecting cards to the Accountant's De- partment at London, for audit, the first Monday in February, May, August, and November every year. 10. Pass books must be sent to the Head Office, London, for .iddition of interest, and for purposes of audit during March in each year. Every ■care must be taken by the depositor to guard against the loss of his book, or collecting card. 11. A depositor's pass book must not be used as a security for money borrowed, and no person holding a pass book in respect of a loan can be recognised by the company. 12. On a depositor leaving the employ of the company all interest shall cease, and the balance of the account will be paid to the depositor on receipt of a notice of withdrawal. 13. The company reserves the right to terminate the arrangement at any time on giving three months' notice. 14. All money deposited shall be the bona fide property of the depositor. Disregard of this rule renders the depositor liable to forfeit all interests on deposits to which he would otherwise be entitled. •JOS RULES OF CERTAIN PROFIT-SHARING (xii.) Stroud Brewery Co., Limited. Employees' Profit-Shar'nig Scheme — Rules and llegulations. The directors are desirous of instituting a profit-sharing scheme for the benefit of tlio emjjloyces of the brewery. The objects tliey liave in view are: — (i) To give to those employed in the l)rewery a share in the profits wlien the company is prosjx'ring, and thus enlist their active co- operation in securing economy and efficiency, (ii) To assist the efforts of tho.se whi) are striving to improve their position in life, (iii) To ensure as far as possible, in the intere.sts of employer and employee alike, the permanence and regularity of employment. They therefore offer to every employee (except those whose remunera- tion exceetl.s £250 per annum, those who are Buying Agents, and those whose remuneration is, either wholly or in part, derived from commission) an annual l>onus upon his wages according to the following scale: — When the Dividends are A Bonus of 5 per cent. 21 per cent, on wages earned, 6 ,, 3" ' >} "a >j >> >) 8 4 Q 41 ■^ )> ^5 >' >> >} 10 „ 5 and so increasing the bonus bj- ^ per cent, for every 1 per cent, of dividend. The proposal is made subject to the following rules and conditions: — 1. Xo employee to be entitled to a bonus until he has been for one complete year in the service of the company (with the exception of those employed in the maltiiigs right through one season and who return to work again at the beginning of the next season and are in the company's employ in the January following). 2. The directors reserve the right of -nnthholding the bonus from any man whose work or conduct is distinctly careless or unsatisfactory. 3. The bonus shall be calculated to the 17th >vovember in each year, and shall be declared in, or about, the January following, and after declaration it shall only be liable to forfeiture in case of fraud. 4. The bonus for any current year shall be liable to forfeiture in the case of any employee who leaves without notice, or who is dismissed for mi.sconduct ; or to make good any damage caused by his carelessness or wilful }ieglect of duty. In acting upon this rule the decision of the directors icill he final. 5. The bonus will be calculated on the total daily wages earned by the employee in the course of the year, which, for this purpose, shall end on the 17th November in each year; no account being taken of overtime. 6. No deduction shall be made on account of absence caused by accident or illne.ss, unless the amount of such absence excee not less than 25 ]>er cent, of the amount distril.utahic (including Income Tax) among tiic manage- ment shareholders out of the i)r(jhts which it shall h(> determined to distri- bute for that year after payment to the management sharelu)lders of th« fixed non-cumulative dividend for that year at the rate of lU per cent. That such bonus fund be subject to the foiluwiug conditions and be applied in manner following: — (a) It shall be distribtitetl by the directors as a bonus amongst such of the emj)lovees of the company as may have performed their duties in a manner satisfactory to the directors rat^ably in pro- IKjrlion to length of .service and to their respective salaries, as follows : — For the jjurpose ol making the calculations for ..uch distribu- tion there shall bo added to the amount of the salary of each such employee payable at the close of the financial year, in respect of which the bonus is set aside, an allowance of 5 })er cent, for each year of service the employee has then completeossible after jiayment of the final dividend on the management shares of the company. (/) So soon as possible after the 30th June in each year the directors shall cause to be prejDared a list or lists of the employees who in their opinion are entitled to participate, with the amounts calculated as aforesaid of their respective salaries and additions as at the close of the financial year then last past and certifying the proportion of the amount distributable to each employee. It shall be in the absolute discretion of the directors and they shall be the sole judges as to whether or not an emjiloyee shall or shall not participate, and every such list shall be deemed to be correct and shall not be questioned and may be acted ujJon by the companj' without incurring any liability whatever. (j/) The directors .shall not be bound to distril>ute the whole of the bonus fund in respect of each financial year but may carry forward a portion thereof not exceeding one-half per cent, upon the total amount of salaries and additions thereto mentioned above. CO-PARTNERSHIP SCHEMES. 2)'^ (■h) No employee or number of employees shall be deemed to have any legal rights to a bonus or any interest in the bonus fund until such bonus shall have been definitely alhx^atetl to him or them by the directors. (i) The directors may determine that all oi- any provisions relating to the bonus fund shall be varied from time to time as occasiou or circumstances may require, and may put an end to the bonub ftmd as at the close of any financial year. (xvi.) SirAltKHOLUING ScHEME OF A FIRM OF EnGI.VEEKS. The shares are 7 per cent, non-cumulative participating preference shares, issued to employees of the company at par. The following are the regulations relating to their issue, holding, and transfer: — 1. The shares shall be issued against payment to the ccmipany of th» sum of £1 for each share, and such shares shall rank for all puiposes from the date of issue pari passu with the existing preference shares of the company, provided only that the dividends on such shares shall accriK^ and be payable proportionately from the dates of payment of the instalments. 2. Each employee shall be entitled to apply in his own name for 5 shares or any multiple of 5, but not exceeding 100 shares in all, but a married employee may, in addition, apply in the name of his wife for o shares or any multiple of 5, btit not exceeding 100 in all. 3. Payment for these shares shall be made, in the case of those in receipt of weekly wages, by oO equal weekly instalments, and in the case of those in receipt of a monthly salary, by 12 eqtial monthly instalments. Payment in full or on account of instalments will be received at any time, and such pre-payments will rank for dividend from the date of actual payment. 4. The holder of such shares, so long as he is an employee of the company, shall be entitled^^ in addition to such dividend as may be declared on the preference shares from time to time, to a bonus to be paid out of the profits of the c^)mpany equivalent to 3 per cent, per annum on the amounts paid up on stich shares, and such bonus shall be paid half-yearly. 5. In the event of an employee being the holder of such shares leaving the company's service at a time when he has paid either in full or in part, he shall offer the said shares to the directors at the par rate plus the proportionate part to the date of sale of the accruing dividend, and in the event of the directors failing to find a purchaser among the employees or ofl&cials of the company for such shares within a period of one month at such rate, then the employee shall be entitled to letain the shares or dispose of them as he may think fit, but the right to the bonus referred to in clause 4 hereof shall cease as on the date on which the emjjloyee leaves the company's service, the proportion of the l)onns to that date being paid to such employee. 6. In the event of an employee desiring to sell his shares, although re- maining in the comjiany's service, he shall offer the said shares to the directors at the rate aforesaid, subject to the conditions set forth in the previous clause. 7. In the event of the death of an employee, his heirs, executors or administrators shall offer the shares to the directors on the terms and subject to the conditions set fortli in clause 5. 8. In the event of any employee ajiplying for shai-es in his wife's name, as provided in clause 2 hereof, his wife shall for the purjioses of these regulations be regarded as an employee of the company so long as she holds such shares. In'the event of her death her shares shall be transfeired to her husband, if he be then an employee of the company. On her husband leaving the companv's service her shares shall be oftVrcd to the directors, together with her hus])and's shares, according to the ])i-ovisions of clause 5. 9. In the event of an employee being unal)lo to continue ])ayment of the instalments on his shaies, the directors may, upon ai)])Iication by the em- ployee, agree to suspend the payments for a ]>eriod of three months, at the end of which time, if the employee is not able to continue payments, he shall offer the shares for sale to the directors on the terms and subject to the conditions set forth iu clause 5. 214 RULES OF CERTAIN PROB'IT-SHARING OR CO-PARTNERSHIP SCHEMES. 10. certificates for these shareti will be issiUHi 14 days after payment of the final instalments. 11. The above regulalion.s, or any of them, may be varied by the Board of the company, provided that such variation shall finst have been approved by a three-fourtlis majority at a meeting of the lioklei-s for the time Jjeing of such sliares. 12. Tlie regulations as to these shares, for the time being in force, shall be endorsed on the certificates of such shares. Number of Shares applied for. 5 10 15 20 25 50 75 100 50 weekly pay- ments of 2/- 4/- 6/- 8/- 10/- 20/- 30/- 40/- 12 monthly pay- ments of 8/4 16/8 £15 £1 13 4 £2 1 8 £4 .3 4 £0 5 £8 6 8 Until such time as the directors give notice that the List of Applications for this issue is closed, employees may continue to send in applications for these shares notwitlistanding the fact that they are already holders of shares {irhether fully-jKiid or partly-paid), subject to the Jirnltation in clause 2 hereof. Form of Application for Shares. To the Directors of & Co., Ltd. I (name in full) of (full postal addressj hereby request that you will allot to me Preference Shares of £1 each, and I hereby agree to accept the same or any less number that you may allot to nie upon the terms and conditions of the Company's circular dated the 4th April, 1919, and Memorandum and Articles of Association of the Comi^anyj and I authorise you to place my name on the Register of Members in respect of the Shares allotted to me, and I hereby undertake to pay for the Shares allotted to me by -i^ gQ-joi j^. fu] payments, and I authorise the Company to make the necessary deduction . weekly wa^es ,. .■, ^ ^ from my y^^,ith'ly saTary ^^^ }^^^ purpose of such payment. Signature. Date. BIBLIOGRAPHY. 215 APPENDIX F. List OF Publications in the Library of the Intelligence and Statistics Department dealing with Profit-sharing avd Labour Co-partnership. UNITED KINGDOM. (a.) Official Publications. Industrial Questions and Traxle Unions, Correspondence with U M Missions Abroad regarding. Reports ivelating to the Progress of J^oreign Industry and Production, Co-operative Societies. &c., 1od7. Co-operation in Foreign Countries, Jieports by U.M. liepresentatives Abroad on the Systems of. Commercial No. 20 (1886). [U. 4783 1 Beport on Profit-sharing. J. Lowry Whittle, 1890. (C 6267 ) Beport on rrofit-sharing. D. F. Schloss, 1894. (0. 74-38.) Beport on Profit-sharing and Labour Co-partnership in the United Kingdom, 1912. [Cd. 6496.] Do., 1920 [Cmd. 544]. Beport on Profit-sharing and Labour Co-partnership Abroad 1914 [Cd. 7283.] ■ ' ' ' Labour Gazette. Articles, with statistics of Pro fii-sharing :— July, 1895; July and December, 1896; July, 1897; August, 1898; August, 1899; August, 1900; August, 1901; March and July, 1902; October, 1903; October, 1904; September, 1905; April, 1907; January and February, 1909; October, 1910; October, 1911. Profit-sharing and Labour Co-partnership, July, 1912; Septem- ber, 1913; September, 1914; November, 1915. Abstract of Labour Statistics of the United Kingdom. 1st (1893-94) to 17th (1915). Statistics of Profit-sharing in each issue. Beport on Industrial and Agricultural Co-operative Societies in the United Kingdom, 1912. [Cd. 6045.] Profits and Profit-sharing with Employees (Associations of Consumers), p. x.\vi. Profit- sharing (Associations of Workers), p. xxxiii. Boyal Commission on Labour, 1891-1894: — For references see (1) Index to the Evidence given by repre- sentatives of Co-operative Societies and of Various Movements, before the Commission sitting as a Whole. (C. 7063-iii.) (2) Index to the Evidence taken before Groups .4., B and C. (C. 7063-iv.) (3) Glossary of Technical Terms. (C. 7063-v. c.) (4) The Agricultural Labourer. Vol. 1. Part iii (C. 6894-iii), Part iv. (C. 6894-iv). Snmll Uolding Colonies Acf, 1916. Annual Reports of Proceedings under. Board of Agriculture and Fisheries. 1917 [H.C. 34/1918]; 1918 [H.O. 115/1919]. Profit-sharing in holdings. Profit and Loss Sharing on the Farm, " Wages Board Gazette." (Agri- cultural Wages Board), October 15, 1919. Coal Industry Commission, 1919. For references, see Vol. II — Reports and Minutes of Evidence on the Second Stage of the Inquiry [Cmd. 360]. Vol. Ill — Appendices, Charts, and Indexes [Cmd. 361]. Production and Distribution of Milk, Final Report of the Committee on. 1919 [Cmd. 483]. Report of the Sub-Committee on Labour in Dairying — Relations between employers and employees. Appen- dix A— Particulars of Co-partnership, Profit-sharing, and Bonus Schemes. (6.) Unofficial Books, Pamphlets and Articles. Agriculture. Co-operative Agriculture: A Solution of the Land Que-stion as exemplified in the History of the Balahine Co-oprrative Agricultural Association, County Clare, Ireland. Wilham Pare, 1870. (London: Longmans, Green & Co.) 216 Hii?Li(K;RAriiY. Agrintlturc. The Irisli l>aml .iiid I.iibour Qiicstion illustrated in the llistorii of linldhinr i{v]><)rt of the Unionist Social l^ei'orni Coni- niitte<-, 1914. (Murray.) Boniis on Wmjts {I'mpl-.tharnKi). Chapter IV in " Co-operation and the Future of Jndu.stry." Leonard S. Wolff, 1918. (Allen & Unwiu.) Better Way, A. See Labour Co-partnership Association, p. 219. Cajntal and Lahonr, The (Jhi'nns of. W. Pare, 1854. (London: Ward it Lock.) Paper read l)y F. W. Shorcy at tlio 1890-91 Session (January, 1891) of the Institute of Marine Engineers. (Printed by Wilsfjn «te Whitworth, Broadway, Stratfoi-d.) Partnership of, as a Snlution of the Con.fiict hetveen then). Henry Vivian. Pead before the Economic Section of the British Asso- ciation, 13th September, 1898. The MaiTiage of. See Labour Co-partnership Association, p. 219. The Futiire L'eUdions of. J. B. C. KershaAV. "Fortnightly Pe- view," December, 1913. Labour and Capital in Alliance. W. T. Tliornton, 1869. See "Labour, On." Clarke, Nickolls d- Coombs, Ltd. See Profit-.shaiing. Also Labour Co- partnership Association. Also The Proof of the Pudding. Coal Mining, Co-partner.'ihip in. See Co-partnership. Also Whitwood Collieries. Commandite, Partnership en. See Partnership, p. 220. Co-operation, Jlistory of. G. J. Holyoake, 1875. 2 vols. Vol. II, Chapter ^Y- -Industrial Partmrship. (London: Triibner & Co.) The Progress of, in England and France. (Pefei-ences to profit- sharing and co-i3artnership schemes.) A. Alillerand. '' New Review." Septeml)cr, 1889. Industrial. D. F. Schloss. " Conteniporaiv Review." April. 1890. at Home and Abroad. C. R. Fay. 1908. ~ Part III, Chapter V— Profit-sharing : The Workers' Society and the Co-operative Store. (London: P. S. King -partnership Magazine." No. 1 (January, 1911) — in progress See also Labour Co-partnership Association, p. 219. Croydon Gas Company. " The Croydon Co-partner." No. 1 (January, 1913) — in progress. Hazell, Watson d> Viney, Ltd. See Labour Co-partnership Association, p. 219. Ilcbden Bridge Fustian Manufacturing Co-operative Society, the story of the formation of, 1888. Report of Coming of Age Celebrations 1891. A brief sketch of Twenty-one Years' Work in Co-operative Produc- tion. Joseph Greenwood, 1891. Industrial Conference, Preliminary. Report of Proceedings, 16th March, 1894. With description of a Suggested Union of Employers and Employed. (London : Methuen & Co.) Proceedings in connection with the. Newcastle-on-Tvne. 13th and 14th October, 1899. Industrial Co-partnership. Dr. Charles Carpenter, 1914. With Chrono- logical Notes on British Profit-.sharing and Co-partnership, 1829- 1914. (Co-partnership Publishers, Limited.) Industrial Efficiency. Arthur Shadwell, 1906, 2 vols. Chapter VIII — Wages. (London: Longmans, Green & Co.) Industrial Partnership. Notes by Spenser Farquharson. " Economic Review," July, 1897. See " History of Co-operation." (Holyoake.) , An. (Wm. Thomson & Sons.) Notes by J. M. Ludlow. " Economic Review," April, 1902. Industrial Partnerships. W. Stanlev Jevons. See " Social Reform, Methods of." Industrial Peace and Industrial Efficiency. Proposals submitted by Sir Christopher Furness, M.P., to a Conference of Trade Union Repre.sentntives (Shipbuilding Industrv), West Ha.rtlejxxjl, 7th October, 1908. industrial Peace, Ways to. (1) " The Capital of Labour: a Suggestion for the Engineering Trades." Sir W. Mather. (2) " The Com- mercialisation of Labour." Yves Guyot. " Nineteenth Century," February, 1918. Industrial Prnhlem, Three Solutions of the. (Profit-sharing, industrial partnership and co-aperation.) C. H. D'E. Leppington. " Charity Organisation Review," April. 1803. Industrial Pcmuneration Conference. January, 1885. Report of Proceed- ings and Papers. (Tx)nd(»n : Cassell & Co., Ltd.) Industrial Prinvnerntinn. Methods of. D. F. Schloss. 3rd Edition, 1917. (London : Williams tt Norgate.) The Increase in. under Profit-sharing. D. F. Schloss. " Economic •Journal," June, 1891. BIBLIOGRAPHY. 2VJ Industrial Union of Employers and Employed. T. "VV. Bu.shill. " Economic- Review," April, 1894. J. M. Ludlow. " Economic Review," October, 1895. Industrial Warfare. The Aims and Claims of Cajntal and Labour. C. Watney and J. A. Little, 1912. (London: John Murray.) Chapter XIX — Profit-sharing and Co-partnership. Industry, The Efficient Organisation of. See Labour Co-partnership. International Co-operative Congress (Fifth), 1902. Second Part (B) — Reports on Profit-sharing in various countries. Third Part- Meeting on Profit-sharing. 7s Co-partnership and Profit-sharing in Industry an advantage or a dis- advantage to the Worker? H. W. Locke, 1913. (Hodgson Pratt Memorial, Ltd.) Knight, John, Ltd. See Labour Co-partnership Association (below). Labour Co-partnership Association (6, Bloomsbury Square, London. W.C.I.). Selection of Publications of : — Annual Reports. 1st (1884-85) to 33rd (1918-19). See also " Co- partnership." The Principles, Objects and Methods of the Labour .4.ssociation. E. Vansittart Neale. Co-operative Workshops in Great Britain. Thomas Blandford, 1!^05. 1897, 1898. The Marriage of Capital and Labour. Address bv Hodgson Pratt. 1896. Labour Co-partnership. James Bonar, LL.D. Read at Leeds Indu.s trial Conference, 4th March, 1899. • Should Workmen be Partners? F. Maddison, March. 1901. Partnership as a Force in British Industry. F. Maddison. — — Sistory and Present Position of Labour Co-partnership. Aneuriii Williams, M.P., March, 1901. Labour Co-partnership and the Aspirations of Labour. Aneurin Williams, M.P., 4th May, 1907. Labour Co-partnership in relation to Social Progress. Professor S. J. Chapman, 1907. Variations of Wages in some Laboiir Co-partnership Work.$hops. With some comparisons with Non Co-operative Industries. Robert Halstead, 1900. Co-partnership in Industry. Dr. Charles Carpenter, 1912. Labour Co-partnership and Labour Unrest. Aneurin Williams, M.P., 1912. A Better Way. Partnership of Labour with Cai)ital. Aneurin Williams, M.P. (n.d.). A Better Way. Some Facts and Suggestions as to introducing the Partnership of Labour with Capital into Established Businesses. Aneurin Williams, M.P. ((n.d.). Capital and Labour. A brief sketch of the " -Maison Leclaire " (Parish and its Founder. Maiy H. Hart. Workmen as Producers and Consumers. F. Maddison (n.d.). The Efficient Organisation of Industry. Henry Vivian (n.d.). ■ Labour Co-partnership in Practice. Henry Vivian (n.d.). . The Industrial Possibilities of Wales. With special reference to tlie SMe Industry. W. J. Parry (n.d.). Co-partnership Organisation of Labour. E. W. Mundy, May, 1914. Beport of Annual Public Meeting, 21st May, 1914. Addresses expla- natory of the actual working of the Co-partnership Principle in the foUowing businesses :- J., T. and J. Taylor, Ltd. :A\ al>a.ll Looks and Cart Gear Society, Ltd.; South Metropolitan Gas Co.: Gas Light and Coke Co. ; Wm. Thomson and Sons: Hazell. A\atson and Viney, Ltd.; John Knight, Ltd.; Maypole Dairy Co.: Lever Bros., Ltd. /-. 1 May, 1919. Speeches on Profit-sharing by Lord Robert Cecil. M.P., and Right Hon. J. R. Clynes. M.P. H 2 24335 220 BIBLIOGRAPHY. Labour Co-parinerslup Associatlvn. Exitcriinents in Vrofit-sharing and t'o-ixirtneraliij). Addresses in November, 1918. (1) J., T. and J. Taylor, Ltd., Mr. T. C. Taylor; (2) Clarke, Nickolls and Coombs, Ltd., Mr. Alexander Horn ; (3) Co-partnership in Mining, Lord Brassey. Co-partnership after the War. A Memorandum submitted February, 1917, to the Reconstruction Committco appointed by H.M. Government. Memorandum on the AjrpUcation of Labour Co-partnership to National Factories. Submitted jointly by the Labour Co-partner- ship Association and the Co-ojH-rative Productive Federation to the Ministry of IMunitions, January, 1919. Memorandum on Labour Co-partnprahip. Addressed by the Labour Co-partnership Association to all joint bodies of I^mployers and Employees, and especially to Joint Standing Industrial Councils and Interim Reconstruction Committees, February, 1919. Labour Co-partnership. H. Dem/arest Lloyd, 1898. (London and New York : Harper Bros.) liecent Progress of. Aneuriii Williams, M.P., and Henry Vivian. " Economic Review," April. 1901. Association, The. Notes. F. Maddison. " Economic Review," July, 1910. Notes in " Economic Review." Henry Vivian, January, 1912; L. V. Lester-Garland. July, 1912. Chapter V— in " Trade Unionism." C. M. Lloyd, 1915. (A. & C. Black.) and Labour Unrest. Theodore Gregory, F.C.A. Manchester Statis- tical Society's Transactions, 1913. Labour, On. Its Wrongfxd Claims and Bightful Dues. lis Actual Present and Possible Future. W. T. Thornton, 1869. Book IV— Labour and Capital in Alliance. (Ijondon : Macmillan & Co.) Labour, The Co-partnership of. Aneurin Williams, M.P., and Henry Vivian. " Economic Review," July, 1894. Labour Ideals— the Better Way. W. R. Bousfield. " Contemporary Review," January, 1913. Labour Question, Lectures oh the. Thomas Brassey, M.P., 1878. Lecture VI — Co-operative Production. (Longmans, Green & Co.) Lever Bros., Ltd. " Progress," 1911 — in progress. See also Labour Co-partnership Association, p. 219. Limited Liability and Co-operative Capital. A Practical Suggestion. W. S. Ogle, F.C.A., 1911. (C. & E. Layton, 56. Farringdon , Street, E.C.) Marcroft Family, The. A History of Strange Events. William Marcroft. Senr., 1889. (Rochdale: P. Wrigley & Sons, Ltd.) Masters and Men: a new Co-partnership. Thomas Foster, 1918. (Headley Bros.) Maypole Dairy Co. See Labour Co-partner.ship Association, p. 219. Mining, Co-partnership in. See Labour C-o-partnership Association, p. 219. Money and Profit-sharing, or the Double Sta.ndard Money System. James C. Smith, 1908. (Kegan Paul, Trench, Trubner & Co., Ltd.) Partnership " en commandite," or Partnership with limited liabilities, 1848. (Effingham Wilson & Co.) Pottery Trade, Profit-sharing and Co-operation in the. Warneford Moffatt. Sec Profit-sharing, p. 221. Pressing Questions. Profit-sharing, Women's Suffrage, Electoral Reform. A. H. Mackmurdo, 1913. (John Lane, the Bodley Head.) Profit-sharing. Profit-sharing between Capital and Labour, On. A word to Working Men. Sedley Taylor, 1882. (Cambridge: W. Me1>- calfe & Son.) Paper read to the Manchester Statistical Society by Sedley Taylor, 10th January, 1883. Six Essays. Sedley Taylor, 1884 (Kegan Paul, Trench, Trub- ner & Co.) BIBLIOGRAPHY. 221 Profit-sharing. Profit-shdring and Co-operative Production. Paper read by E. O. Greening at the Industrial Remuneration Conference, 1885. — - and Co-operative Production. L. L. Price. " Economic Journal " September, 1892. and Co-operative Production. Special supplement to " The New Statesman," 14th February, 1914. Agreement {South Metropolitan Gas Co.). See Gas Companies, p. 218. and Co-partnership. Aneurin Williams, M.P. See " Co-partnership and Profit-sharing," p. 217. between Employer and Employee. A study in the Evolution of the Wages system. N. P. Gilman, 1890. (Macmillan.) D. F. SchJoss. " Charity Organization Review," January, 1890, and March, 1891. — — in Agriculture. Article by Albert Grey in " Journal of the Royal Agricultural Society," December, 1891. Precedents. H. G. Rawson, 1891. (Stevens & Sons, Ltd.) Firms (British), List of, with Notes. T. W. Bushill and D. F. Soliloss. " Economic Review," January, 1891. Official Beport by J. Lowry Whittle. Note in " Economic Review," March, 1891. Official Beport of 1894, Note on. " Economic Journal," September, 1894. Scheme of Clarke, Nickolls & Coombs, Ltd. Note in " Economic Review," April, 1891 Schemes. Notes on. W. H. Frere. " Economic Review," April, 1892. and the Labour Question. T. W. Bushill, 1893. (Methuen & Co.) Co-operators and. W. 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" Economic Re\iew," April, 1 Vindication. Sir George Livesey. " Economic Review," Oc-tober, 1901. . ■„ . ,, T Some Aspects of. George Mathieson. " Economic Review, January, 1902. „ , , . , The South Metropolitan Gas Co. Note as to alleged exclusion of trade unionists. " Economic Review," January, 1902. Experiments. Notes. M. W. Middleton. " Economic Review, April, 1903. . ,, t. • t i '. Hostility of Trade Unions to. Labour Notes in Economic Journal, September, 1902; June, 1903; June, 1904; June 1910. _ See " Industrial Democracy." B. & S. Webb, 1902, p. ool. (Longmans, Green & Co.) m c -i-u Money and. or the Double Standard Money System. James C. Smith, 1908. (London : Kegan Paul, Trench, Triibner & Cx>.) C. R. Fay. -See Coroperation at Home and Abroad. 24335 ' ^ ^ 222 BIBLIOGRAPHY. Profit-sharing and Co-partnership. Monthly Journal. Vol. I, 1812-13; Vol. II — five issues only. (London : Ck)-partnership Publishers, Ltd.) nnd T.nhr.vr Co-pnrtnt'rxhip. Theodore Oooke Taylor. "Contemporary Iteviovv," May, 1912. and Labour Co-parfnership. Xotes on Principles of. Howard Button, 1918. (Gee & Co., 34, Moorgate Street, E.C.) Si>eeches by Lord Robert Cecil, M.P.. and Rt. Hon. J. R. Clynes. M.P. See Labour Co-partnership Association, p. 219. in Operation. (J., T. & J. Taylor, Ltd., Batloy.) Notes. J. L. Stocks. " Economic Review," July, 1912. and Co-partnership. Chapter XIX of " Industrial Warfare: The Aims and Claims of Capital and Labour." C. Watney and J. A. Little, 1912. (Murray.) Article and review of publications. Prof. ^\'. J. Ashley. " Quarterly Review," October, 1913. and Co-operation in relation to the Standard of Life. Prof. D. H. Macgregor. " The Industrial Unrest and the Living Wage," 1913. (P. S. King & Sons.) and. Co-partnership. Lord Leverhulme. " The Industrial North," 1919. (Bradford, Leeds and London : " The Yorkshire Observer.") — — anHt and Stock Sharing, (b) Co-operation. (New York: G. P. Putnam's Sons.) Net Profits in Manufacturing Industries. Part IV of the 21st Annual Report (1891) of the Massachusetts Bureau of Statistics of Liiljour. Deals with the share*> of capital and labour in the product. Pension Funds, Profit-shnring Plans, and Plant and Community Sanita- tion. " Reix)rt on Conditions of Employment in the Iron and Steel Industry of the United States,"' 191.3. Department of Com- merce and Labour. Senate Document No. 110, 62nd Congress, 1st Session. Vol. Ill, chapter XII. Productive Co-operation. Chapter VII, section II in the " llie Labour Movement in America." Richard T. Ely. New edition, 1905. (New York : The Macmillan Co.) Profit-sharing in the United States. Boris Emmet. Bulletin No. 208 (December 1916) of the United States Department of Labour, Bureau of Labour Statistics. in the United States. Section, p. 962, in "The New Encyclopedia of Social Reform." AV. D. P. Bliss, 1910. (New York and London : Funk and Wagnalls Co.) Report on. N. P. Gilman. (Fifth International Co-operative Congress, 1902.) Its hearing on Industrial Unrest. "Journal of Political Economy" (Chicago), December, 1917. Its Principles and Practice. A CoHaboration bv A. AV. Burritt, H. S. Dennison, E. F. Gay, R. E. Heilman and H. P. Kendall, 1918. (New Y'ork and London: Harper Bros.) by American Employers. With Examples from England and Types in France. National Civic Federation, 1916. at a Mill in Bhode Island. Chapter IV — Earnings of Operativee. " Report on Condition of Women and Child Wage-Earners in the United States," 1910. Department of Commerce and Labour. Senate Document No. 645, 61st Congress, 2nd Session. Vol. I — Cotton Textile Industry. Chapter IV — Suggested Remedies for Depressions. First Annual Report (1886) of the United States Commissioner of Labour. Part II, Seventeenth Annual Report (1886) of the Massachusetts Bureau of Statistics of Labour. Carroll D. Wright. Schemes. Extracts from American journals relating to Bulletin 36 (June, 1905) of the Massachusetts Bui-eau of Statistics. " Current Comment on Labour Questions." between Employer and Employee. N. F. Gilman, 1890. Bee p. 221. On Associations formed in the United States. D. F. Schloss. " Economic Review," October, 1892. or the Workers^ Fair Share. G. W. Perkins. Address before the National Civic Federation, September 11, 1919. Profit and Wages. G. A. Kleene, 1916. (New York : The Maemillan Co.) Stockholding by Employees in the United Sta.tes Steel Corporation, [a] Ernest Aves, " Economic Journal," March, 1903. (h) Address of Mr. Seth Low to the National Civic Federation. " Civic Federa- tion Review," March. 1909. Work, Wages, and Profits. H. L. Gantt, 1910. (New York r Engineering Magazine.) France. Action7\ariat omn^ier, L\ Les modes d'entente entre le capital et le travail. Charles Gide. Paris, 1910. Actions de travail, Les. J. Granier. Preface by Charles Gide. Paris, 1910. Reprint from " Cote de la Bourse et de la Banque." G. Martin. Paris, 1911. BIBLIOGRAPHY. 225 Actions dans les societes anonymcs a ^participation ouvriere E. Antonelli Preface by Aristicle Briand. Paris, 1912. Applications de la participation aux benefices. V. Bbhmert. Translated by A. Trombert, 1888. Another edition with Api^endix, 1896. Association de Vouvrier aiox profits du patron, L', et la participation aux benefices. Paul Bureau. Paris, 1896. Bulletin de la participation aux benefices. Societe pour I'etudo pratique de la participation du personnel d ns les benefices. Quarterly. Vol. I (1879) to current issue. Commandite en France. E. Martin Saint Leon. " Economic Journal " June, 1907. Concours de la participation aux benefices au Musee Social, Le Paris 1897. Concours pour la participation aux benefices. Rapport par E. Levas- seur a la Society du Musee Social. " Musee Social," Serie B, No. 9. Paris, 1897. Concjres international de la participation- aux benefices, 19CK). tV)nipte- rendu des seances. Contrat de la participation aux benefices, Le. Son caractere et ses resultats. Charles Robert. Paris, 1889. Contrat du travail, Le, et la participation aux benefices. Guide pratique de legislation et de jurisprudence. P. Follin. Paris, 1909. Co-operation and Profit-sharing in France. Translation of extracts from the Report of the French Senate Committee appointed to inquire into the Bill passed by the Chamber of Deputies on Co-operative Production and Supply Associations, and on Profit-sharing; laid before the Senate on 22nd February, 1892. (Stationery Office Paper, 1893.) in England and France, The Progress of. References to Profit- sharing and Co-partnership Schemes. A. Millerand. " New- Review, " Sept-ember, 1889. at Home and Abroad. C. R. Fay, p. 216. Co-opcraiive Production in France and England. Participation and Profit-sharing. Edward Oummings. 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(Lalx)ur Co-partnership Association.) r; '^ a Guide pratique pour V application de U particijxttwn aux benefices. A. Trombert. Paris, 1892. New edition, 1912. Leclaire. A Lecture by W. H. Hall, ,1880. (Manchester: Central Co- operative Board.) ^ ±- j L'ami des ouvriers. Leclaire et son system e de rem^nneration du travail (1838-1877). Translated from the German of \ . Bohmert. La Maison de, devenu Bedouly et Cie. Entreprise de pemture, d'C, rue Saint-Georges II., Paris. Association delouvner aux benefices du patron. Vol. I., Maison Leclaire RaPP<>!;^' .g^-' 1865-1885. 'Vol. II., Redouly et Cie. Rapports, &c., i«»i-i»yi. Rapport par M. Bedun. Paris, 1883. See also Labour Co-partnership Association, p. ^19. 22t) HIHLIOGRAPHY. Metayage in Western Frnncr. L. L. I'rict-. " Kconomic Journal." March, 1894. I'apeterie co-opdrative d'AiKiotih'iitt. Laroehe—Joulicrt et Cie. Share- holder's Book, Rules, *fec. 1912. Faificipation aux benefices, La. Etude theorique et pialique. M. Vaiilnoi-. Paris, 1898. E. Waxweiler. Paris, 1898. Etude historique, eritiqiie et documentaire. A. Paver. Preface by E. Vallee. Paris, 1911. Participation aux brnepers d'ajyres une enquete recente. La. Rapport ])rosente au Cougres de TAUiance Co-operative International de 1902, par Albert Trombert. Participation aux benefices en France, l)e Vetat actuel de la. M. Garcel, Faculte de Droit de I'l'niversite de Paris. Paris. 1906. Participation des ouvriers aux benefices dr V entreprisc, La, considiree au point de vue du droit. A. Crouzel. Paris, 1885. Partnership " en Commandite." P. 220. Profit-sharing, Types in France. irt on Profit-sharing in France. A. Trombert. (Fifth Inter- national Co-operative Congress, 1902.) l'rofit-s:harin(i and Welfare Work in Fmnce. Edward .1. Deason. " Co- partnership," August, 1919. Solution de la qvestion sociale dans Vindustrie. Une. M. S. Perisse. Paris, 1905. Suppression des gri'ves par V association mtx benefices, La. Conference faito a la Sorbonne le 27 dec. 18G9. par Charles Robert. Paris, 1870. Wohlfahrtseinrichtnngen der Arbeitgeber in Deutsehland und Frankreich. See Germany, p. 227. Belgium. Industrial Communities. Mariemont and Bas6oup C8 Cussons, William, Ltd 178 Dalley, Clement, & Co., Ltd; 152 Dartford Gds Co. (absorbed by South Suburban Gas Co.) Decorative Co-operators' Association, Ltd 170 Denaby Co-operative Pottery ••; „ \^^ Dennis, W., & Sons, Ltd ^\~''\^, Devereux, John, & Sons ll<,l/b Dewsbury Reporter : see Reporter, Ltd. [Dewsbury.J Distillers Co., Ltd ]^\ Dobson & Barlow, Ltd ^'^ 230 INDEX OF NAMES. Page. Douglas & Son, Ltd 154 irOvly e 3-5, 150 Fox, Head & Co. 168 Fox, Mr. J. H., opinion on effect of profit-sharing quoted... ... ... 64-5 France, profit-sharing in, referred to ... ... ... ... ... ... 21-2 Franklyn, Davey & Co. ... ... ... ... ... ... ... 176 Furness, Sir C. (afterwards Lord) ... ... ... ... 113-5 Gallery, S., & Sons 180 Garnett, P. & C, Ltd 154 Gas Light & Coke Co 29,56-8,61,156 Gas Workers' Union ... ... ... ... ... ... ... ... 47-9 Gaunt, Reuben, & Sons, Ltd. ... ... ... ... ... ... ... 158 General Service Co-operative Stores, Ltd. ... ... ... ... ... • 174 Gilbert Bros 109-13,182 Gimson & Co 170 Gloucester Gas Light Co. ... ... ... ... ... ... 55,58,156 Godin, M., quoted ... ... ... ... ... ... ... ... 21 Goodacre, Wm., & Sons, Ltd 162 Goodall & Suddick 170 Grainger & Smith, Ltd 182 Grantham Gas Co. ... ... ... ... ... ... ... ... 55, 60 Gray, Wm., & Co. (1918), Ltd 97-8,162,194-6 Greening & Co., Ltd. ... ... ... ... ... ... ... ... 168 Grey, Earl 170 Grout & Co., Ltd 164 Gryfe Tannery, Ltd 160 Guild of Handicraft, Ltd 172 Guy's Hospital Trained Nurses" Institution ... ... ... ... ... 152 Gwynne, John & Henry ... ... ... ... ... 168 Hailing, Thomas 174 Hamilton & Co., Ltd 117-8,170 Hancock, Wm., & Co., Ltd 178 Harris, F. W 180 Harrow & Stanmore Gas Co. ... ... ... ... ... ... 56,58,158 Haslemere Builders, Ltd 146-8 Hasler & Co., Ltd 156 Hawkins & Tipson, Ltd. ... ... ... ... ... ... ... 164 Hazell, Watson & Yiney, Ltd. 76-8,150 INDEX OF NAMES. 2:31 Headley Bros. Heathcoat, J., & Co Hertford Gas Light Co. Hertford, Marquis of ... Hickman, Sir Alfred Hickman, Alfred, Ltd. ... Hill, G., & Son, Ltd Hill, W., & Son, Ltd Hills, Mr. A. F. (managing director of Thames Ironworks) Hollins, Wra., & Co., Ltd Holloway, G. ... ... Holmes & Co. Home & Colonial Stores, Ltd. ... Horn, Mr. Alexander (of Messrs. Clarke. Nickolls & Coombs, Ltd. ) Hubbard, G Huddersfield, ^ee Longwood & Slaithwaite Gas Co. Hunter, John A., & Co. Hutchinson, Herbert Ideal Club and Restaurant Idris & Co., Ltd. IlfordGasCo Ilford, Ltd Indemnity Mutual Marine Assurance Co., Ltd. Ipswich Gas Light Co Irvine's Shipbuilding & Dry Docks Co., Ltd. Jacks, W., & Co. Jacobsen, Welch & Co., Ltd. ... Jackson & Sons ... Johnson Bros. (Dyers), Ltd. ... Johnston, James Jolly & Son (Bath), Ltd. Jones Bros. & Co. (Wolverhampton), Ltd. Jones, Samuel, & Co. ... Jordan & Sons, Ltd. Joyner, Charles, & Co. ... Kensington Co-operative Stores, Ltd. Kensington Co-operative Stores, Ltd. (Dressmaking Department) King, Bolton Kinnear, John Boyd Knight, John, Ltd 101-2,154 Labour Co-partnership Association ... ... ... ... 7-8,20,74,0.5 Ladyman, J. H., & Co 1^- p KCT.. 174 160 55-6, 158 174 1(57, 176 ltJ4, 167 162 170 11 162 . . „ 174 170 '.• S-'J. 162 .) 20 174 178 118. 140-7. 178 178 "ll8. 176 56 156 180 '.'. 99," 100 162 56 160 .. 113-G 182 170 162 174 '149 158 176 168 162 1.58 164 174 174 ... 178 170 "■29, 170 Lawrence, William, & Co., Ltd Lawson, Wm. Leamington Priors Gas Co. Lee & Hunt Levant Mining Co. Leverhulme, Lord Lever Bros., Ltd. Lily Laundry, Ltd. Liverpool Gas Co. Livesey, Sir Geo 176 168 ....')5, 58, 60, 154 172 182 78-9 ,17,22,26,78-85,156 164 5'>. 57, 60, 158 47,48 Lloyd & Summerfield Co-partnership, Ltd 168 232 INOKX OF NAMES. Page. Loders & Nucolirie, Ltd. ... ... ... ... ... 158 London Co-operative Supply Stores, Ltd 174 London County Westminster & Piirr's Bank, Ltd 85-6, 162 London, Dcptford, and Greenwich Tramways Co ... ... 174 London, gas companies in : nee under Commercial Gas Co. ; Gas Light & Coke Co. ; South Metropolitan Gas Co. ; South Suburban Gas Co. ; Tottenham District Liglit, Heat & Power Co. ; Wands- worth, Wimbledon, & Epsom District Gas Co. Longwood and Slaitliwaite [Huddersfield] das Co.... ... ... ... 182 Low, Sampson, Marston & Co., Ltd. ... ... ... ... 172 Mackay, W. & J., & Co 174 Maidenhead Gas Co 182 Mail c^i Leader, Ltd 182 Manners, Lord George ... ... ... ... ... 108 Martin, Robert, Ltd 158,167,174 McVitie, Robert 174 McVitie & Price 118-9,174 Meath Home Industries Association ... ... ... ... ... ... 180 Merthyr Tydfd Gas Co 56,57,158 Metcalfo & Cooper, Ltd 180 Milliners' and Dressmakers' Co., Ltd. ... ... ... 168 Morton, A., & Co. ... ... ... ... ... ... ... ... 178 Mumby & Son, Ltd 160 Mundell, Jesse ... ... ... ... ... ... 178 Murray, R. S., & Co., Ltd 158,196-7 Mushet, Robert, & Co 176 Myers, S. P., & Co., Ltd 162,197-8 NeiU-Watson, H. C. (Court Laundry) 162 Nelson, J.E 180 Newman & Son ... ... ... ... ... 174 Newmarket Gas Co 56, 160 New Welsh Slate Co., Ltd 172 Norman, Sawyer & Co., Ltd 182 North of England Industrial Coal & Iron Co., Ltd. 168 Nottingham Brewery, Ltd 178 Netting Hill Electric Lighting Co., Ltd 158 Osborne & Young 119,174 Osborne, Chas. H. ... ... ... ... ... ... 158 " Our Sons," Ltd 162 Paget & Allsebrook 116,182 Paget & Rymer... ... ... ... ... ... ••• 182 Paruall, William, & Co. 178 Parry, W. J., Ltd 154 Pease and Partners, Ltd. ... ... ... ... ... ... ... 154 Peel Bros. .' 176 Penman, A. C 182 Perrott & Perrott, Ltd 170 PetoBros. 119-20,172 Petty & Sons, Ltd 176 Phillips & Co 120,176 Pickwell, Jacob ... ... ... ... 178 Plymouth and Stonehouse Gas Light and Coke Co. 182 Powell, N. J., & Co., Ltd 178 Price's Patent Candle Co., Ltd. 168 Prudential Assurance Co., Ltd. 28, 102-3, 164 INDEX OF XAMES. 233 PaGK. Raithby, Lawrence & Co. Ltd. 17G Rank, Joseph, Ltd ... ... jyo Ratcliffe, John ... ... ... ... ... ... .._ _ _ jyjj Rayleigh, Lord ... ... 1.54 Raymond Bros. ... .,, ... ... ... [ l>^2 Redhill Gas Co. ... 5g r^-j kjo Reporter, The, Ltd. [Dewsbury] .'. '154 Richmond Gas Stove and Meter Co., Ltd 180 Robinson, E. S. & A., Ltd 30, 65, 103-5, 149, 158," 1*99-201 Rogers, R. H. & S., Ltd. ... ... ... ... ... ... ]21 17G Rolls, Sir John Shelley-, Bart. ... ... ... ... ... ... 1G2 Rowntree, John, & Sons ... ... ... ... ... ... ... i.",2 Rowntree, W., & Sons 17«2 Rugby Gas Co .56,57 8,154 Rochdale Equitable Pioneers [Co-operative] Society 122,123 Sadd, John, & Sons, Ltd. ... 152 Saville's (1902), Ltd 154 Scott, Thomas ... ... ... ... ... ... ... ... ... 172 Scottish Co-operative Wholesale Society ... ... ... ... 125, 129-131 Serre, Achille, Ltd. 162 Shelley-Rolls, Sir J., Bart 162 Shrewsbury Gas Light Co. ...' ... ... ... . , ... 57, 160 Simcox, Miss, quoted ... ... ... ... ... ... ... 28,117-8 Simpson, A. ... ... ... ... ... ... ... ... ... 182 Smith & Forrest 178 Smithson, Joseph, Ltd. ... ... ... ?.. ... ... liJ4 Snowden, T., & Son 20,162 Solicitors' Law Stationery Society, Ltd. ... ... ... ... 158,201-2 Somers, Walter (1919), Ltd 149, 160 South Buckley Coal & Fire Brick Co., Ltd 168 Southend Gas Co. ... ... ... ... ... ... ... 47,55-6,160 South Metropolitan Gas Co. ... 8,11, 20-22, 27,29, 47-55, 56-59, 1 52, 203-6 South Suburban Gas Co 58,60,152 Spencer, Earl ... ... ... ... ... ... ... ... ... 170 Spillers Milling and Associated Industries, Ltd. ... 20, 89, 149, 154, 167, 207 Spillers and Bakers, Ltd 167,180 Spottiswoode & Co. ... ... 170 Stow, John, Ltd. • 180 Stroud Brewery Co., Ltd 160,208-9 Strutt & Parker (Farms), Ltd. 156 Sussex Brick & Estate Co., Ltd K^O Sutton & Co ••; 162 Swansea Gas Light Co. ... ... ... .-. ••• ••• 55-7, 160 Tamworth Herald Co., Ltd ^^^^ Tangyes, Ltd ••; „ ^'^ Taylor, J., T. & J., Ltd 1*^-7, ^2, 26, 80-., lo2 Taylor, Sedley ^^^-^. Teasdale & Co., Ltd }2V Terrell, William, & Sons, Ltd. 1'^ Thames Ironworks and Shipbuilding Co., Ltd 1| Thomas, J. L., & Co., Ltd ."•-,.■:•,„.,, Thomas, Richard, & Co., Ltd ^^-'' ^';'^' '-V-'tI^ Thomasson, John, & Son \, ' Thomson, Wm., & Sons, Ltd l"*^ Tobacco Corporation, Ltd ••• i^ Tollesbury & Mersea, Native Oyster Fishery Co., Ltd IM Tootal Broadhurst Lee Co., Ltd ••• ^^* 2;V{ INDEX OF NAMES. Page. Tottfulmm District Light, Heat & Tower Co 29,156 Trotter, Y, c^' Son, Ltd 178 Troiighton \- Sininis ]l^ Tinker. . I anus, Lt, 12.0 Industrial and Provident Societies Acts, societies registered under, «^« Co- operative Societies. Industrial Co-operative Societies, see Co-operative Societies. Industries in which profit-sharing is practised ... ... \b, 16, 127-8, 131, 139. 140, 150-165, 168-183, 190 Insurance companies, profit-sharing in : — Life insurance 15,23-4,28,102-3,154-5 Marine insurance 15,99-100.162-3 Interest :— On capital, reserved limit of, see Reserved Limit. On employees' deposits ... 38, 44-6, 54, 61-6, 78, 90, 103-4, 119, 191-2, 200-1.204,207,209 On provident funds 41,105,208 Interval between bonus payments ... ... ... ... 28,38,94,119 Investment of bonus in shares of employing company, see Capitalisation. Investment of provident funds ... 40-1,77-8,96,139 \_See also Appendices A and B.] Investment of savings by employees, facilities for, see Savings ; xee also Savings or Deposit schemes, and Shareholding schemes. Investments by employees : — In existing schemes 54,61,63,66,69,72,75,77 \_See also Appendix A.] In abandoned schemes ... ... ... ... ... 130,144,211 [iS'ee also Appendix B.] Irish dairying societies, profit-sharing in ... ... ... ... 140-1 Iron and steel trade, profit-sharing in 65-6, 160-1, 164-5, 168-9, 176-7 Jam manufacture, profit-sharing in ... ... ... 88-90, 128, 156-7, 174-5 Joint Committee, see Co-partnership Committees. Juries of workmen in accident cases ... ... ... ... ••• ••• ^- Labour Co-partnership defined ... ... ... ... ••• ••• ••• ' [^ Strikes in profit-sharing firms : — Absence owing to, not counted as "lost time," in certain circum- stances :. 37,98,195-6 Other references 11,48-9,71,102,109,114,120,183 \_See also Results.] Superannuation, see Pension Funds. Taxation, effect of, on profit-sharing 30, 181 Textile trades, profit-sharing in ... 15, 16, 23-4, 63-5, 67-71, 86-7, 120-1, 128 133, 141-4, 150-5, 158-9, 160-5, 168-9, 170-1, 176-183 Thrift funds : see Provident Funds. ^ i iq- c Time-keeping as condition of participation 36-8, 79, 81, 92, 97-8, 101, 19o-b [See also Attendance, and Sickness.] ^ Trade Boards ~ Trade Unions : — - 1 1 i o Attitude of, towards profit-sharing or labour co-partnership ... ^J; l^/-^- 48-9,113.115,119-120,181 Employers' attitude to ... 35-6, 49, 59, 70-1, 97-8, 108, 113-5 142-3 140, lyb Trades in which profit-sharing schemes have been adopted, see Businesses. Transfer of shares by employees : — qq a- (■ Allowed without restrictions bd, oo-b Forbidden or restricted, .see Restrictions. - , /.n o i t i - 1 7a n Transport trades, profit-sharing in ... 15, 16, 154-0, lbO-3, 1 /4-o, i /»-J :^14 INDEX OF SUBJECTS. Page. Trust deeds, profit-sharinfT schemes embodied in ..: ... 44,78-85,89,115 Trustees under protit-sharing schemes ... ... 43-4, 54, 57, 79-82, 97, lUO-1, 150-1, 15tJ-7, 1G0-3, 194-6, 203-4, 212 A'oting strength of employees ... 2.0, 44, 54, GG, 73, 77, 85-7, 90, 115, 128, 130-1, 1.35, 140-1, 198 Wages and salaries in profit-sharing firms : — la bonus clear addition to wages ? ... ... ... ... ... 24,25 Is bonus taken into account in fixing wages '? ... ... ... 24, 25, 126 Other references ... 64, 97, 108-9, 117, 121, 130, 139, 143, 169, 171, 173, 181, 183, 192-3 Wages Board, in Bradford Dyers' Association, Ltd. ... ... 70 War, effect of, on profit-sharing : — In confectionery trade ... ... ... ... ... ... ... 96 28,30-1,181 29,30 31 28, 103 86-7,91,99, 149,162-3,183 In corn mills In gas industry In electrical industry In life insurance companies . In other businesses ... ... 12, 28-31, ()6, 75, [See alsii Excess Profits Duty, Income Tax, War Loan, War Savings Certificates.] War Loan, War Savings Certificates, &c. : — Bonus paid in i ... 86-7, 153 Investments in, reduce employees' investments in business of employer 30, 66, 91, 183 Provident fund invested in ... ... ... ... ... ... ... 41 War Savings Certificates : see under War Loan. Warehousemen, profit-sharing in businesses of, see Merchants, &c. Waste of time, materials, or property of employer : — Employees penalised or disqualified for ... 36, 37, 19, 58, 79, 81, 101, 203 Profit-sharing as incentive to avoidance of, see Stimulus. Whitley Report, references to 8,60,70 Widows and orphans, provision for, see Provident Funds. Winter men in gasworks ... ... 48-50, 58, 204 " Withdrawable bonus " (W.) schemes : — Abandoned schemes, small proportion of ... ... ... ... 18, 19 Two types distinguished : — (i) Bonus paid into savings account, instead of in cash ... ... 19 (ii) Bonus consists in interest on savings or deposits varying with the profits ... ... ... ... ... ... ... 19 \_See also under Savings or Deposit Schemes.] Withdrawal of deposits, notice required for ... 46,57,58,62-3,104,191-2, 200-1, 207, 210 Women in gasworks ... ... ... ... ... ... ... 51,206 Women in other profit-sharing firms ... 37, 39, 40, 96-7, 104, 1.39, 143, 199 Woodworking and furnishing trades, profit-sharing in ...15, 116-7, 128, 133, 160-1, 170-3, 176-183 Woollen and worsted industry, profit-sharing in ... 63-5, 86-7, 141-4, 150-5, 158-9, 162-5, 176-9, 182-3 Woollen and worsted industry, private business converted into co-operative society ... ... ... ... ... ... ... ... ... 141-4 Workmen-directors, see Directors. Workers" productive societies : see Productive Societies. Zeal, profit-sharing as incentive to, see Stimulus. / WEST AFRICAN CURRENCY BOARD. Report for the year ended June 30, 1919. [Cmd. 475] of Session 1919. Price 2d. {M.) COAL MINES CONTROL AGREEMENT (CONFIRMATION) ACT, 1918. Accounts for 1917-18 and 1918-19. Account of Receipts and Payments by the Board of Trade and the Commissioners [nland Revenue respectively, under the Coal Mines Control Agreement (Confirmation) , 1918. for the period April 1, 1917, to March 31, 1919, together with the Report of Comptroller and Auditor-General thereon. H.C. 11 of^Session 1920. Price \d. (lirf.). RATES OF INCOME TAX AND SUPER TAX. Statements showing the Amount of Tax payable on certain Incomes, and the rtual Rate charged in the £, under the existing law, and under the proposals made by 5 Chancellor of the Exchequer on April 4, 1916. H.C. 51 of Session 1916. Price hd. (Id.). Estimate prepared by the Board of Inland Revenue shewing the Approximate stribution of the Estimated Amounts of Taxable Income, Allowances, &c., among ixpayers, classified according to the Amounts of their Total Incomes, together with 5 Estimated Number of Incomes in each Class, and the Tax paid by each Class. [Cmd. 224] of Session 1919. Price id. (2d.). INCOME TAX. Allowances for Wear and Tear and Obsolescence op Plant and Machinery, &c. Statement respecting. Memorandum by the Board of Inland Revenue : — Legal Dsition ; Rates Fixed by Agreement in Certain Trades ; Temporary Variations Necessi- ted by War Conditions ; Obsolescence ; Renewals ; Buildings and other Wasting Assets eluded from the Depreciation Allowance ; " Conti'olled Establishments." Schedule of greed Rates of Depreciation. Appendix : — Acts relating to Deductions for Wear and ear of Machinery and Plant— The Customs and Inland Revenue Act, 1878 (sec. 12), le Finance Acts, 1907 (sec. 26), 1916 (sec. 39), and 1917 (sec. 16). [Cd. 9022] of Session 1918. Price Id. (Ud.).\ Further Statement. Similar to the above, and dealing also with : — Appeal to oard of Referees ; Income Tax Authorities concerned ; The Commissioners of Inland .evenue ; The Income Tax Commissioners ; and the Finance Act, 1918 (sec; 24). [Cd. 9134] of Session 1918. Price Id. {2d.). INLAND REVENUE. •Sixty-First Report. of. the Commissioners, for 1917-18. Inland Revenue Duties generally ; Estate, &c.. Duties ; Stamp Duties ; Land Tax— . .eat Britain ; Inhabited House Duty— Great Britain ; Income Tax ; Super Tax ; i excess Profits Duty, &c. ; Duties on Ijand Values ; Local Taxation Accounts ; Com- pensation under the Licensing (Consolidation) Act, 1910. I [Cd. 9151] of Session 1918. Price 3d. (iid.). PROFIT SHARING AND LABOUR CO PARTNERSHIP. MINISTRY OF LABOUR (INTELLIGENCE AND STATISTICS DEPARTMENT). REPORT ON PROFIT-SHARING AND LABOUR CO-PARTNERSHIP IN THE UNITED KINGDOM. Presented to Parliament by Command oi His majesty. LONDON: PRINTEII AND P'JBLISHKD BY HIS MAJESTY'S STATIONARY OFFICE. To be purchased throusli anv Biiok-ieller or directly from H.M. Sl'ATlONKRY OFFl.IE at the fcllowins addresses: iMPJiUlAL HuCSE. KiNGbWAY, LoNDOJM, VV.C.ii, and 28, ABIXODON STRpKl. LuNDoN, S.W.I: H7, I'EIEU STUEET, Al AXC-HEhTER : 1, ST. .-VNDKEWb ClJE.^CE>.'f, C.'AUDIFF 23, Forth street, Edinbi^rqh ; or from E. PONSONBY, Ltd., lie, Guafxon Street, Di'klin. 1920. [Cmd. 544.] Price \s. Net. 5 2^' It UNIVERSITY OF CALIFORNIA AT LOS ANGELES -ruiF- i K'>"-'-"-i-rv I IRRARY Bllivr ^'-^fiWA UC SOUTHERN REGIONAL LIBRARY FACILITY 'I«l -;■-:• :fM^''£TiVl mm'm ■'!';■: '.'f^i' ■r-: ■;:.■ ! .'I^f .r;-i;v'.^g i(-.,l;,,V-