Ford Asks Permission to Install Profit-Sharing System on His Railroad

The New York Times
November 19, 1922

WASHINGTON, Nov. 18.—Henry Ford applied to the Interstate Commerce Commission today for authority to put into effect on his railroad, the Detroit, Toledo & Ironton, a system of profit-sharing somewhat similar to that effective in his manufacturing plants.

The commission was asked to approve an issue of $1,000,000 in "investment certificates," which will be sold to employees for cash in denominations of $100, $500 and $1,000. These certificates will bear no fixed rate of interest, but the money received from their sale will be invested in the railroad itself or in other enterprises, as the management may decide, and at the end of each year an amount ranging up to a limit of 25 per cent. of the railroad's net earnings will be distributed to the employes holding investment certificates.

No guarantee will be given the employee of any definite interest return, the application said, nor will the company necessarily devote the entire 25 per cent. of net earnings suggested as applicable to the certificates in any one year. The employe, however, will be returned his full investment upon demand and thirty days notice at any time.

E. G. Liebold, Vice President of the railroad, in an affidavit explaining the plan, said that the Detroit, Toledo & Ironton now had 2,225 employes earning an average of $185 a month. From experience in the other Ford enterprises, it was assumed, he said, that one-half of them would take the certificates.