All profit-sharing firms base their hopes of increased efficiency on the incentive given to the worker by an anticipation of profit; the payment of wages is by day work or piece work, and these have the defects already mentioned. There is no direct and immediate incentive. The slacker gets the same reward as the good man, and there is nothing to prevent piece rates being cut just as in an ordinary shop. Profit sharing is undoubtedly a splendid thing in principle, but it tends to make a man drop his trade-union and takes away his independence. It also means a rigid selection of workers, only the ones who look ahead being automatically chosen. Already they must be men of thrifty disposition, men who look forward to being employed in one factory all their lives, otherwise they would not be chosen. They are not necessarily the best men; indeed, they cannot be the best men because only a wide experience of different factories and methods produces the best men. But they are essentially steady men, and this is the kind of man most employers prefer, because they are the least likely to cause trouble when rates are cut or wages reduced. It is usually pointed out that, if a rate has to be cut, the worker gets it back again in the form of profit. This system certainly tends to get rid of the slacker--the worst form of slacker, that is--and there are circumstances under which it would prove of great value. The fact of there being so few profit-sharing firms tends to show that profit sharing is not a method which appeals generally to both employer and worker. The following is a profit-sharing scheme adopted by a large firm of engineers in March, 1916, and therefore embodies the most modern conditions: "1. Before any profits are divided with the employees, the shareholders shall receive 8 per cent. per annum. "2. When the above 8 per cent. has been paid to the shareholders in any calendar year, all cash dividends subsequently declared in that year will be divided between the shareholders on the amount of their stock interest and the employees on the amount of the salary or wages received by them during the twelve months ending June 30 of that year, as follows: (A) Employees who have been continuously in the service of the company for at least two years prior to July 1 will receive dividends at the same rate as the shareholders. (B) Employees who have been continuously in the service of the company for more than one year and less than two years prior to July 1 will get three-quarters of that rate. (C) Employees who have served continuously for less than one year will get one-half the rate of the shareholders. (D) Dividends that have accrued will be distributed to employees once a year in December.