PROFIT SHARING

Evening Post, Volume CX, Issue 155, 29 December 1925, Page 7

PROFIT SHARING

P. AND O. COMPANY'S OFFER.

(From Our Own Correspondent.)

LONDON, 21st November

Evoryone.on the pay roll of the Peninsular;and Oriental Steam Navigation Company, and its associate company, the British India Steam Navigation Company, is invited in a circular just issued to invest his a? her savings in the company, It is understood that the matter has for some time past engaged the attention of LoTd Inchcape, the chairman of the companies, and is in the interests of industrial peace. It differs from other profit-sharing experiments in that shares are not given to 1 the employee?, it being left to them to invest their own earnings at an advantageous rate of interest, which increases in proportion to the annual dividend.

It is thus a direct incentive to personal thrift, and an encouragement to all employees to do their utmost to assist in economy and efficiency in the company's working, for the greater the profits, the larger the interest on their investments.

The circular is in the following terms: With a view to giving them an interest in the undertakings, the board of the P. and O. Company is prepared to receive deposits from all employees of the P., and O. and British India Companies, bearing merest at ' 5 per cent, per annum, together with an additional 2 per cent, when the dividend paid by the P. and 0. Company on its deferred stock is 5 per cent, per annum, or over; or £J per cent, when the dividend is 10 per cent, or over. The deposits should be made in sums of £10 or multiples thereof. Interest and additional 2 per cent, or 2J per cent, will run from the date of receipt of the deposits. The deposit receipts will not be neI gotiable but will be repayable by the I company on any Ist January on six months' notice in writing being either given by the company or Teceived from depositors. Warrants for the interest and additional 2 per cent. or 2J per cent., as the case may be, i will be sent to depositors yearly on 31st December.

The first payment of interest and the "additional," if any, will be made on 31st December, 1926, arid annually thereafter. Tho first "additional" will be dependent on the dividend for the company's year ending 30th September, 1926, and so on yearly thereafter. The board reserves' to itself full liberty to terminate the receipt of deposits at any time and to limit the amount deposited by any individual depositor.

It is understood that the scheme is considered by its sponsors to be "eoiiveuient for all parties and preferable to the creation of a special denomination of employees' shares." The plan, it. will be seen, will moournge thrift and give the depositors a direct interest in the profits of the company. Not only is the basic rate of 0 per cent. :i satisfactory one, but any additional interest will be entirely dependent on the prosperity of the company as indicated by the rate of dividend declared on the deferred stoclc. It will be interesting to learn a year hence to what extent the staff, afloat or ashore, have availed themselves of the offer. The hope is known to Le expressed that "with its peculiar incentive- to personal saving and the interest whi'-h it should induce in tho success of the company's operations, it should prove as successful as any plan ret evolved with a similar object." . - 83, Fleet at tee I. \ i