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Gives $10,000,000 to 26,000 Employes

American Government Special Collections Reference Desk

Topics:  Ford Motor Company

Gives $10,000,000 to 26,000 Employes

The New York Times
January 6, 1914

Ford to Run Automobile Plant 24 Hours Daily on Profit-Sharing Plan


No Employe to be Discharged Except for Unfaithfulness or Hopeless Inefficiency

Special to the New York Times

DETROIT, Mich., Jan 5. - Henry Ford, head of the Ford Motor Company, announced to-day one of the most remarkable business moves of his entire remarkable career.  In brief it is:

To give the employes of the company $10,000,000 of the profits of the 1914 business, the payments to be made semi-monthly and added to the pay checks.

To run the factory continuously instead of only eighteen hours a day, giving employment to several thousand more men by employing three shifts of eight hours each, instead of only two nine-hour shifts, as at present.

To establish a minimum wage scale of $5 per day.  Even the boy who sweeps up the floors will get that much.

Before any man in any department of the company who does not seem to be doing good work shall be discharged, an opportunity will be given to him to try to make good in every other department.  No man shall be discharged except for proved unfaithfulness or irremediable inefficiency.

The Ford Company's financial statement of Sept. 20, 1912, showed assets of $20,815,785.63, and surplus of $14,745,095.57.  One year later it showed assets of $35,033,919.86 and surplus of $28,124,173.68.  Dividends paid out during the year, it is understood, aggregated $10,000,000.  The indicated profits for the year, therefore, were about $37,597,312.  The company's capital stock, authorized and outstanding, is $2,000,000.  There is no bond issue.

About 10 per cent. of the employes, boys and women, will not be affected by the profit sharing, but all will have the benefit of the $5 minimum wage.  Those among them who are supporting families, however, will have a share similar to the men of more than 22 years of age.

In all, about 26,000 employes will be affected.  Fifteen thousand now are at work in the Detroit factories.  Four thousand more will be added by the institution of the eight-hour shift.  The other seven thousand employes are scattered all over the world, in the Ford branches.  They will share the same as the Detroit employes.

Personal statements were made by Henry Ford and James Couzens, Treasurer of the company, regarding the move.

"It is our belief," said Mr. Couzens, "that social justice begins at home.  We want those who have helped us to produce this great institution and are helping to maintain it to share our prosperity.  We want them to have present profits and future prospects.  Thrift and good service and sobriety, all will be enforced and recognized.

"Believing as we do, that a division of our earnings between capital and labor is unequal, we have sought a plan of relief suitable for our business.  We do not feel sure that it is the best, but we have felt impelled to make a start, and make it now.  We do not agree with those employers who declare, as did a recent writer in a magazine in excusing himself for not practicing what he preached, that 'movement toward a the bettering of society must be universal.'  We think that one concern can make a start and create an example for other employers.  That is our chief object."

"If we are obliged," said Mr. Ford, "to lay men off for want of sufficient work at any season we purpose to so plan our our year's work that the lay-off shall be in the harvest time, July, August, and September, not in the Winter.  We hope in such case to induce our men to to respond to the calls of the farmers for harvest hands, and not to lie idle and dissipate their savings.  We shall make it our business to get in touch with the farmers and to induce our employes to answer calls for harvest help.

"No man shall be discharged if we can help it, except for unfaithfulness or inefficiency.  No foreman in the Ford Company has the power to discharge a man.  He may send him out of his department if he does not make good.  The man is then sent to our 'clearing house,' covering all the departments, and is tried repeatedly in other work, until we find a job he is suited for, provided he is honestly trying to render good service."

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