Bonus plans favored by U.S. metal mines

Metal mines in the U.S. outpaced coal mines in 1993 in incentive bonus plan implementation, according to a compensation survey by Mining Cost Service of Spokane, Wash.

Incentive bonus plan utilization by metal mines reached 77% of the 66 metal mines surveyed, up from 70% the previous year.

Only 37% of the 79 coal mines surveyed indicated they had incentive bonus plans in place, a trend which has remained essentially unchanged for about five years, says the company.

In addition, more non-union mines than union mines reported using bonus plans at both the coal and metal mines.

Bonus plans that tend to dominate are based on production, safety, cost savings and profit. However, comprehensive gain-sharing-type plans continue to grow in popularity, replacing “gypo” or contract systems. Gain-sharing plans usually tie bonuses to improvements in more than one area, such as safety, production and cost savings. They also usually entail employee involvement in management decision-making.

While the coal mines surveyed reported paying fewer bonuses, they compensate by paying considerably higher base wages and salaries than non-coal mines. The disparity in wage rates closed somewhat last year, as wage increases averaged 2.1% at the surveyed non-coal mines, compared with 1.7% at the coal mines.

For more information, write Western Mine Engineering Inc., Mining Cost Service Division, 222 W. Mission Ave., Suite 218, Spokane, WA 99201, U.S.A.