18 
II.—PRIVATE FIRMS AND COMPANIES. 
panies the salaries include those of managing' and other directors, 
and an analogous practice obtains with a few( a ) private firms, 
though, as a rule, in such firms the remuneration of management 
is included in the proportion of the profits not allotted to em 
ployees, but retained by the firm. As to the minimum remunera 
tion of capital, interest at fixed rates is included in a large 
number of instances, whether in the case of joint stock companies 
or of private firms, among the deductions to be made before “ net 
profits ” are arrived at; the fixed rate of interest being generally 
5,( b ) sometimes 6,( c ) per cent., and only exceptionally a lower( a ) 
or a higher( e ) percentage. In the case of No. 60 the remunera 
tion of capital is secured by a certain standard of profit' being 
fixed for each job; this scheme is confined to working foremen 
(leading hands), who are paid a percentage on the total account 
for each job, and a special provision is made that any deficit on 
the estimated profits is deducted from the amount due to the 
employee. In some cases special mention is made of sums to be 
set aside for depreciation^) and for reserve funds.(») Under 
scheme No. 7 a sum is set aside before profits are divided to be 
devoted to a Provident Uund for widows and orphans of em 
ployees. 
The “ reserved limit ”—i.e., the point at which the participa 
tion of the employees begins—is in a few cases( h ) known to be 
based not on the actual profits earned in the years immediately 
preceding the introduction of the profit-sharing scheme, but on 
an amount below those profits. 
The principle upon which the reserved limit is calculated is 
generally communicated to the employees.0 In a few cases( J ) 
the results of the calculation determining the total amount avail 
able for participation are certified by professional auditors, whose 
figures can be seen by the employees. In two( k ) cases the 
employees are allowed to inspect the books of the firm. 
Share in Profits allotted to Employees. 
The proportion of the profits allotted for division between the 
employees varies considerably in different schemes. Of the cases 
in which no mention is made of any part of the total net profits 
being retained for the employers as a reserved limit, there are a 
few(’) in which .10 per cent, of the profits is allotted as the share 
(0 Nos. 19, 27, 35, 78, 115. 
( b ) Nos. 5, 6, 9, 16, 28, 41, 43, 49, 62, 65, 78, 87, 103, 115, 117, and one anony 
mous case ; in the case of No. 49 the rate is cumulative. 
0 Nos. 14, 25, 26, 51, 75, 76, 92, 120, 122 ; in the case of No. 76 the 
rate is cumulative. ( d ) No. 88, 4 per cent. 
( c ) No. 131, about 9T per cent. ; Nos. 61 and 125, 10 per cent. ; No. 81, 50 
per cent. ( f ) Nos. 5, 25, 26, 37, 43, 78, 125. 
(») Nos. 5, 6, 7, 9, 25, 49, 76, 125. (”) Nos. 19, 25, 27, 66. 
Q In the case, however, of Nos. 23 and 64 the reserved limit is disclosed 
only to a professional auditor, who in the former case issues a certificate if no 
bonus can be paid, and who in the latter case certifies the amount due toemployees. 
(i) Nos. 14, 20, 30, 39, 47, 57 ; see also reference to Nos. 23 and 64 in 
preceding note. 
( k ) Nos. 54 and 78 (through Finance Committee—see pp. 46-49), 
0 Nos. 17, 126, and one anonymous case.