Denver labor bulletin., 1917-03-03
SHARING
AND BONUS PLAN
BULLETIN ISSUED BY U. S,
LABOR BUREAU.
Shows Difference Between Two Pro-
grams of Employers in Large In
dustrial Enterprises of Country
So Far Experienced.

A bulletin (No. 20S) on profit shar-
ing in the United States, recently is
sued by the United States bureau of
labor statistics, classifies two forms
of profit sharing in operation in this
country-one under which distribution
of specific proportion of the net
profits is made to at least one-third
of the total number employed, includ-
ing employees in occupations other than
executive and clerical, and the other
limited profit sharing plan under
which less than one-third of the en-
ployes, excluding employees other than
executives and clerks, are participants.
There are, however, bonus and stock
purchase plans, popularity known as
profit sharing plans. The bulletin pre-
sents careful examination and analy-
sis, with statistical data of all the
plans in operation, describing in de-
tail the arrangements in specific es-
adjustments and pointing out the fac
tors which determine profits, the con-
ditions under which they are distribut-
ed, the proportion of total employees
who participate, the occupations or
types of employment of participating
employees, the benefits accruing to par
ticipating employees, the cost to en-
ployers, and the results secured thru
the operation of the plans.
Costs Only 6 Per Cent.
There are known to be sixty estab-
lishments in the United States oper-
ating under the first plan, the profits
distributed ranging from 2 to 100 per
cent of wages. Payments mostly are
made in cash, altho in some cases
stock is given. Thirteen of these firms
are in Massachusetts, and twenty-six
are manufacturing establishments. Of
thirty-four employers reporting, the
cost to more than one-half was less
than 6 per cent of their respective
pay rolls. Five employers paid 20
per cent or over. In these thirty-four
establishments S2.9 per cent of the
employees participating were other than
executives, clerks or salespeople Of
thirty-seven establishments, 514 per
cent reported so per cent or more of
their employees participating.
The number of firms conducting a
limited profit sharing plan is very
large. Of seventeen reporting, almost /
all bar the wage Garner or manual !
worker. In most of these the pay I
ments are made in cash, the usual |
practice being to set aside arbitrarily /
percentage of the profits after meet |
ing all legitimate expenses of the |
business, including interest on the |
investment. In eighteen establish |
IlelltS dppTOHlIHdlely "a per cent OF !
the participating employees were exec |
utives, clerks or salespeople. In ten
of the establishments the proportion
of participants was less than 10 per
cent of the number employed
Bonus Merely a Gift.
Under many of the bonus plans the
employees share is merely gift and
bears no relation to profits realized. !
Three specific plans are described in
detail, giving rules governing their
operation, benefits accruing to en-
ployes, cost 10 employers, etc. One
plant operating under this plan dis
tributed in the first year 69.7 per cent
of all employed total of s8,434, ,S49 |
on regular pay roll of s14,021 OCT.
These various actual and so-called
profit sharing plans have resulted in
establishing more satisfactory rela-
tions between employers and employees |
and have contributed considerably to
the stabilization of the working force, |
but employers are not agreed as to the |
results achieved with reference to in |
creasing the individual or collective |
efficiency of participating employees.