﻿APPENDIX F.

General Form for a Simple Profit-sharing Scheme :
Cash Bonus. (Reprinted from Profit-sharing and the Labour
Question, by T. W. Bushill,* pp. 233-237.)

(1.) Method of Profit-sharing.—From and after the 1st of January,
1890, the surplus (if any) of the clear profits of the business beyond
such definite sum as is for the time being reserved to the firm for their
own benefit (herein-after referred to as the “ reserved limit ”) shall be
divided into two equal parts, one thereof to be distributed gratuitously
as a bonus to the employees in the manner defined by these rules, and
the other to be retained by the firm.

(2.) The “ Reserved Limit.”—The present reserved limitf has been
communicated confidentially to	, chartered

accountant, and will not be altered for the first three years, if the
scheme so long subsists. Thereafter it may be raised or reduced by the
firm, but (unless altered during some month of January) not so as to
affect the distribution of profits for the financial year current at the time
of alteration. Notice of any alteration will be given to the employees
in such manner as to let them know how far such alteration would have
affected the last preceding distribution had it then been in force.

(3.) Accountant’s Certificate.—The accounts of the business will be
audited each year by a chartered accountant, who will certify to the
employees the bonus (if any) to which they are entitled.

(4.) Qualifications for Profit-sharing.—The employees entitled to share
in the profits for any financial year are such only as were employed at
the commencement of such year, and have furnished a request to be
entered on the list of profit-sharers. The acceptance of the terms herein
offered is not to be in any way a condition of employment or of promo-
tion. Profit-sharers will be free to become or remain members of any
trade or friendly society.

(5.) Duration of Scheme.—The scheme is to continue in force only until
the firm give notice to the employees putting an end thereto, but such
notice, unless given during some month of January, will not take effect
until the end of the financial year current at the time it is given.

(6.) Method of Distribution.—-The employees’ share of profits accruing
in each financial year is (subject as after mentioned) to be distributed
among them in proportion to their respective salaries or wages at the
commencement of such year, taken for one week, exclusive of premiums,
overtime, or other variable allowances. In making any year’s distribu-
tion it shall be permissible to the firm to carry forward undivided to the
credit of the following year’s employees’ share of profits any sum which,
if divided, would have given to them less than one week’s wages, calcu-
lated as aforesaid.

(7.) Payment of Bonus.—Each employee’s bonus shall, within two
months of the end of the financial year, be paid into his account at some
savings bank, and will then become his absolute property.

(8.) Employees leaving.—An employee whose service ends by notice
given on either side, by illness, or by death, will have a right to bonus
for the financial year in which his service ends, in proportion to the
portion of the year elapsed to the end of the month preceding the end
of his service. Any employee leaving under circumstances other than
before mentioned shall lose such right. Any sum lost to an employee
under this rule does not accrue to the firm, but goes wholly to increase
the distribution to the other employees.

* London: Methuen & Co., 1893.

t It !s very desirable that some intimation of the possible benefit to the employees
should be given when the scheme is introduced. A simple style of communication
would be: “ It the profits during the present year equal the average of the past
three years, there would be a bonus equal to	weeks’ wages for each

participant." (T.W.B.)