More About the Bonus Scheme
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Concrete Details About the Extra Sums a Driver Can Earn and the Monetary Benefits an Employer Can Derive from the Introduction of Cash Incentives into His Business : Direct _Value of Having Vehicles Kept Clean
IN my previous article I described a seemingly complicated bonus scheme involving consideration of five ,factors; work done, cleanliness of the vehic16, kind of traffic carried, deductions for =punctuality, and absence without leave. There was also a Christmas box.
For the first of these, the amount of work done, the driver could earn as much as £1 per week, paid in cash at once; for cleanliness, a further 10s. per week; for good average all-round performance, including punctuality and regularity of attendance, a further 10s. per week, which could be augmented to some slight extent by the addition of a proportion of the fines paid by delinquents and, on top of all these, a supplementary bonus award at the end of the year. The foregoing are what might be called bonuses on general performance. To them must be added bonuses for particular traffics and a Christmas box.
As an indication of the generosity of the scheme and giving an idea of its benefit to the driver who strives to meet all its .requirements, the following figures giving the amounts earned during the first year of operation of the scheme by the man who received more than any of his mates are of interest.
£1,700 Paid Out
On the cartage of sugar-beet at Is. per load, £9 6s.; for ashes at the same rate, £1 Is.; weekly bonus, paid in cash, £42 6s. 8d.; bonus for cleaning the vehicle, £9 13s. 10d.; yearly bonus (the amount of eight weeks' averaging), £45 Is. 3d.; additional bonus (the percentage of the £13 added by the employer), £11 5s. 4d.; Christmas box, £10. The total is £128 14s. id., or nearly £2 10s. per week. In the first year of its operation, £1,700 was paid to 15 drivers.
No consideration of the bonus is allowed to interfere with the legal wage which, with full allowance for any overtime, is paid to each driver. In fact, of course, no divergence would be permissible. .
An important aspect of the scheme is the method of its administration. This is carried out by a committee composed of three directors and three employees, tke latter being selected by the men themselves.
A35 When I first described this scheme several years ago i was promptly criticized by an operator who was highll experienced in all the aspects of haulage of goods an carrying passengers. He wrote saying that he could no understand how a concern employing 15 men and payini statutory wages could afford to hand out £1,700 in bonusu over a period of one year.
The short answer is that the scheme was successfully pm into operation and continued so, barring alterations of a minor nature. The proof of the pudding was in the eating and no one complained about it. The company's balance sheets were quite satisfactory, not showing any signs of suffering as the result of this apparently extravagant bonu.i plan.
Still Worth While ,
• I would. like to suggest, at this point, that if, by the payment of this bonus, the net profits of the company were increased by £1,701 per annum, it would still be worth while, if only for the fact that the drivers were able to add substantially to their earnings and at the same time increase the tonnage carried by the vehicles they drove.
The difference between these two operators seems to be a fundamental one. One of them has sensed the wisdom of paying a little extra to his men in the belief that it would possibly be profitable to him if he did so. Events have justified that belief. The other has not yet realized the basic truth that by giving his drivers a monetary interest in seeing that the most is got out of the vehicles, the business is the more likely to be profitable than otherwise.
One of the features of any bonus scheme must be that it is generous: a scheme which. benefits the worker to the extent of 10s. a week is not going to make much of a stir among drivers of vehicles: it is insufficient. In a matter of this sort it is no use half doing a job. For this bonus to succeed in its object it must arouse the interest of the men who are to earn it; it must be substantial. Is it likely that any
n is going to be enthusiastic about a possible 10s. extra xeek? Of course not.
again, it often happens that those who give often find t their receipts increase more than the disbursements bonuses. Fortunately for me, the employer who had rked the scheme out was of the typo who was always .eeable to disclosing his plans. Here are some of his iwers to my queries. Before proceeding, however, 1 must ,ke it perfectly clear that the figures I shall use are itious.
Fake first the item relating to the bonus of Is. per load the cartage of sugar-beet. Incidentally, the award of ?onus of this amount and in this way has for many years
a common practice among some sugar-beet hauliers. asay therefore be presumed that they have found it to be ffitable. A good average rate per ton for sugar-beet oughout the season is 9s. 6d., and that happens to be rate for a 10 miles lead.
Easily Accomplished
assume that a driver, in the normal way, would have Tied 15 loads in a week, which represents a bonus of 15s. regards £.1 per week as much more attractive and, by :rcising his own energy and initiative, he manages to iceze in another journey per day, five extra toads per ek. Those who have experience of sugar-beet haulage I have been in factory yards and observed the difference tonnage as between an energetic driver and one who is t so keen will appreciate that this difference of five irineys per week can often be quite easily accomplished. [he extra cost to the operator per week, based on a 10 les lead average, is the running cost of 100 miles at llid. mile, which is nearly 965. Add the bonus, £1, and the al extra cost to the operator is seen to be £5 16s. per week. e extra revenue is that accruing from the cartage of five ds of beet per week, 30 tons per week at 9s. 6d. per ton— t 5s.—so that there is an item of £8 10s. to go to the credit e of that account.
4. sugar-beet campaign lasts about 12-14 weeks, but as ;re is not always sufficient beet to keep the vehicle fully ployed, it would, perhaps, be fair to take the middle 10 eks as being those during which this extra traffic could obtained. That does, at least, mean that on the sugar
alone there is a profit of £85 per week per vehicle. If ly five of the 15 vehicles are engaged on this traffic there an extra profit of about £425.
3is far as the haulage of ashes is concerned, this is sbably not a large item in the balance sheet, but it is t as likely to be as beneficial to the operator to pay this per load bonus as it is for sugar-beet. It would be fair d reasonable, therefore, to add another £100 to that :ount, making the total £525 for sugar-beet and ashes
Inc.
As Many As Possible
Now I come to the general traffic. The bonus for this, it iy be as well to recall, is awarded on the basis of a check the driver's daily work. The completion of an extra irney adds to the driver's credit in respect of the bonus is going to earn, and as there is a possibility of earning any £2 per week, it is obvious that every driver is going do what he can throughout the year to put in as many irneys as possible. I do not say that the scheme works out precisely like it. Bearing in mind all the circumstances, a man who s done only a couple of journeys per day has nevertheless ne all that is possible. That man gets full marks and the 11. bonus. In the end, however, the maximum bonus in year goes to the man who, as the result of his energy and • tiative, has Managed to squeeze in some of these extra limeys which, as no experienced operator will deny, mean difference between a possible meagre profit and an ample e.
Supposing that the average throughout the staff of 15 ivers is three journeys per week each. Let me take it that ch of those three extras journeys brings in a revenue of s. which it would for traffic at 6s. 8d. per ton. They mid probably be short journeys of a dozen miles or so, merely the running cost at ilid, per mile, which is
I Is. 6d., showing a net profit of 28s. 6d. per journey. That is £4 5s. 6d. per vehicle per week, or approximately £64 per week for the fleet or, in round figures, £3,330 per annum.
It may be as well to emphasize here that the operational supervision is such that no driver can make extra journeys at the expense of his vehicle by excessive speeding or anything of that kind. A personal check on this part of the work is carried out periodically by one of the directors who, incidentally, regards it as part of his duty to assist the drivers whenever he can to bring in that extra load per day which means so much to both company and men.
In view of the foregoing, it seems hardly necessary to continue the argument, but, as a matter of fact, I regard the bonus for cleanliness of the vehicle as being as important as any part of the scheme. It may be recollected that each driver has to keep his vehicle clean, not merely as regards the outside, but in respect of the engine, gearbox, chassis, wheels, underparts of the mechanism, in fact, everywhere. Marks are awarded and drivers are paid up to a maximum of 10s. per week for 100 per cent. efficiency of their cleaning operations. The cost to the company of that bonus is in the region of £200 per annum, or at an average rate of 6s. per week per driver, making £4 10s. per week for the fleet Practically the whole of that amount is saved because, with this system in force, the wages of at least one regular cleaner and the expenses connected with his employment are eliminated. In addition, there is the undoubted advantage which comes as a result of keeping the mechanism of a vehicle scrupulously clean.
Definite Economies
Economies are bound to result, both in respect of maintenance and repairs and as regards the number of days per annum that the vehicles are out of commission on account of some lack of maintenance, which does not occur in connectioh with vehicles kept as clean and examined as regularly as in the case of this fleet.
It is obviously difficult to estimate the savings it is possible to make in this way, but suppose 1 take it that the average saving in time is three days per annum for each of the 15 vehicles, the value of a day being not less than £5. The annual savings on this account approximate to £225
The saving in cost of repairs is not likely to be less than £5 per vehicle per annum, which is another £75, making £300 on that account. Altogether, therefore, rather more than £4,000 can be set against an expenditure of £1,700. The foregoing calculations are bound to be sketchy. Because of the addition of the sugar-beet bonus to the general bonus, there may be some overlapping. The driver's main bonus is checked against his daily record sheets and he is paid that irrespective of the traffic he may be carrying. The Is. per load for sugar-beet and ashes is supplementary, being paid, as I explained in my previous article, because the material is more difficult to handle and involves some manual effort on the part of the driver.
Even if I have overestimated the profit from these 15 drivers being so keen on their work, I still think that the £1,700 paid out in bonus is worth while. Indeed, the result demonstrates that it is so. These 15 drivers are not merely 15 individuals, each going about his work in a more or less clotk-watching mood, but constitute a team, each member of which realizes that by working a little harder and helping his employers he is at the same time helping himself.
S.T.R.