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II.—PRIVATE FIRMS AND COMPANIES.

expenses and paying any subscriptions due to co-operative propa-
gandist associations. Any surplus profit is to be applied as
follows: —

“ (1.) In paying the 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 Eeserve
Fund, until such fund shall equal 25 per 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 every such
recommendation he 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 approved hy the general meetings; and

“ (5.) If any surplus still remains, in paying in cash a further
dividend on shares for the year.”

Taking together the profit-sharing bonuses distributed first by
the firm of William Foster & Sons and subsequently by the
Company (Foster, Sons and Company, Limited), the average ratio
which the bonuses distributed in the years 1901-1911 have borne
to the wages and salaries of the participants has been 2'5 per cent.

Out of the total capital of the Company (4,000 shares of £1
each) 764 shares are owned hy the Employees’ Society. These
shares entitle the Society to one-fourth of all the votes that can
be given at a general meeting of shareholders of that Company;
and out of the four directors of the Company two are employees,
appointed by the Employees’ Society.

In reply to the question addressed to the Company as to the
results obtained by the arrangements above described, the Company
states that the adoption of this system has proved “ satisfactory
on the whole, though for four years, owing to low competitive
prices, there has been no profit. It has improved matters in
increased zeal on the part of the more intelligent men. There are
also more harmonious relations [between employer and employed].
Many men, however, are too low in general intelligence
to grasp the principle underlying either Profit-sharing or
Co-partnership.”

Investment in Shares in Names of Trustees.

Another form of profit-sharing scheme is that under which the
employees may acquire a share in the capital of a business by the
investment in shares, to be held by trustees on behalf of the