The Helena independent. [volume] (Helena, Mont.) 1875-1943, 1890-07-17
ABOUT PROFIT SHARING.
The System Had Its Origin in France
Some Fifty Years
Ago.
Dividing Profits by Cash Payment
and by Establishing Prov
ident Funds.

Failure of the System In tho Case of the
Whitewood Galleries - Tho
Reason Therefor.
The system of dividing portion of prof
its among wage earners is no new thing,
saws the st. James Gazette. It is now
nearly fifty years since Edme Jean Leclalre.
a French house painter in large and pros
perous way of business, who had risen from
the humblest beginnings, determined to Sc
cure the honest cooperation OF his en-
ployes by giving up to them portion OF
the income they helped him to gain. In the
face of the greatest mistrust and opposition
Leclaire stood by his intention; and at the
end of 1912, the first year of his experiment,
distributed among the men e475, or an av-
eraee of over e1O apiece. This very practi-
cal proof of the genuineness of Leclaire's
intentions Immediately disarmed the sus-
picions of his workmen, who needed no fur
Their inducement to make the most of the
opportunity offered by their masters
clear headed generosity. Once fair
" started the plan prospered exceedingly,
to the advantage Of both giver and rece iver;
and its success has never been IN doubt
from the day of its Inauguration to the
present. OF the advantage gained by Lee
claire's men, it is enough to state that in
the forty years from 1874 2 to 1882 sum of
33.O45 was paid over to them as bonus in
addition to wages on the usual scale. Not
all the share of profits allotted to the work
men was paid over in cash; notifications
demanded by the circumstances were made
when necessary in the original scheme; but
the mode Of distribution finally assumed tea
profits earned went to the managing direc-
tors, who were also salaried and received
interest at per cent. on their capita! m
vested in the business; one half went TO
the workmen as cash bonus, and the re,
naming quarter was paid to the Mutual
Aid society, equivalent to a provident fund.
This society, thus splendidly subsidized,
very soon developed into an institution
which of itself must have offered strong
temptation to workmen to take service with
the Maison Leclalre.
profits allotted to workmen between q cash
payment at the end of each year and
subscription to a provident fund ia that
adopted by most of the houses which prac-
tice profit sharing. Some there are, how
cash-as, for instance, N. Bord, the piano.
forte maker. M. Bord introduced the sys-
TEN into his business on account of q strike
in 1865, and has since then paid over con-
siderable portion of his profits to all work
men who have been IN ,6 has employ foi SIX
away was G5.205. being 20 per cent of the
whole amount paid in wages during the
wear. At the other extreme stands the sys-
tenn employed by the ComPagnie d'Assuran-
ces Generates, under Which per cent on on
aside for the benefit Of the en-
ployes and allowed to accumu-
late at interest till after twenty-five years.
service, when the amount is invested for
the benefit of the owner, who is allowed to
ital. No actual money bonus is paid at all.
Yet another manner of profit sharing is
that practiced by some limited liability
companies. in which certain number of
shares are set aside for workmen and
offered to them ON especially favorable
ton of profits has found considerable favor
on the continent, where many firms have
adopted it with generally very beneficial re-
suits to all parties concerned. One strik-
ingly successful instance was brought un
Mime. Boucicaut, of the Bon Marche, Paris,
whose clerks and shopmen hold three fifths
of the very large capital represented in the
business. Another is that Of the Mason
Chalk, which runs the bookstalls at
wonderfully complicated time tables. In
England profit sharing has never caught on
as it has abroad. Still, from time to time,
various firms in different parts Of the coun-
try have made the experiment and most of
them have found it to pay to go on with.
TONERS, Coventry, who recently started a
profit sharing system differing in some
slight respects from that of any other house,
were awarded silver medal for their rules
in the social economy system OF the Paris
Exhibition. Their first years trial has been
very successful, bonus of six weeks wages
having been allotted to their workmen IN
addition to the sum placed to reserve.
The other side of the shield is seen in the
notorious example of the Wildwood col
lieries. The case is an interesting one at
the present moment, as the immediate
ticipation was the Intervention between the
COMPANY and its men of the miners union,
In 1864, on the reconstruction of the COM
pany, it was provided that one-half of any
excess profits. after the payment OF ten
per cent. dividend, should be distributed
among all the men employed by the COM
pany in proportion to their respective earn
ings. For some years the system worked
admirably. In 1872 came the boom" in
the coal trade, and in consideration OF rap
idly rising prices the men asked and were
granted an advance on their wages amount
ing to nearly 30 per cent; while at the same
time it was fixed that dividend should be
paid before profit should come into opera
ton. Even these altered condition were
highly satisfactory to the men; in June,
1874. E13, 256 was distributed among them,
as against t5, $50 in the previous year. In
the latter half of 1874 prices declined, and
a general reduction of wages in the trade
became necessary. The company's men
joined in the general strike which ensued,
and on the shareholders protesting against
any further payment of the bonus, it was
discontinued. The Miners union looked
unfavo-ably on the industrial partnership
in force at the Wildwood collieries. The
men were taught to think that the money
distributed to them at the end of the year
was their just due and was nothing more
than a deferred payment, which should
have been spread over their weekly wages.
The time came at last when difference arose
between the company and its men on a
technical point, the use of riddles" The
position assumed by the mon was alike un-
reasonable and unfair; but they were
backed by the union, and in the name of
the union q resolution was posted, declar-
ing their intention to never again submit
to the use of the riddle. Shortly after
ward came the strike, when the men again
opposed their masters and drove them in
disgust to discontinue the partnership IN
profits. Nor was it surprising: the men
had shown that they were ready to take all
they could get, and in return would give
nothing. Excuses have been made for the