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average salary, and in case of death being due to an injury or malaria acquired in service, the lump sum was increased, as in other cases, one-fourth, with a minimum limit of six months of the average annual salary, always excepting, of course, such cases of injury or disease which are compensated under special laws or regulations.

If a member who was relieved from the service and was receiving a pension died and his family was not entitled to receive this pension, not satisfying all of the necessary conditions, then the family received the same lump sum as above, minus the sum of continuous payments made to the member before death, with a minimum of four times the monthly pension of the deceased.

Loss oF PENSION RIGHT.-As in the case of the pension fund, the member lost all rights to any benefits by resignation or dismissal. In case of voluntary resignation his family also lost all rights, while in case of dismissal the wife and children had rights equal to those of a widow and orphans in case of death of the member. There were some regulations providing for reinstatement in membership in case of recognized mistake in a disciplinary dismissal. But disregarding these, the loss of rights to pensions and other benefits by dismissal or resignation must be considered a very serious feature of the organization, especially in view of the large monthly contributions to the revenue of the society from the small earnings of the members.

ACCIDENT COMPENSATION.—Similarly to the pension fund the mutual benefit society was intrusted with the duty of accident compensation. The pension fund assumed this duty toward all its members who came within the provisions of the accident insurance law. The mutual benefit society did the same toward those of its members, covered by the law, who were not at the same time members of the pension fund, and also toward such railroad employees as were covered by the accident law, and who were not members of any of the provident institutions and were not insured in some other way.

The provisions regulating this branch of the society's activity were practically identical with those concerning the same function of the pension funds. The basis of it was that the nonmembers who came within the provisions of the accident law received from the mutual benefit society the payments as regulated by the law; members received the payments due to them as members, and if this amount was less than that granted by the accident law, an additional sum to make up the difference. In other words, the injured or his family could receive only one of the compensations due either under the society's constitution or the accident law, receiving only the larger of the two. The cost of these accident cases did not impose any burden upon the finances of the society, as the administration of the railroad paid into the society's treasury the amount of compensation due under the law, the cost of medical treatment, etc. When pensions instead of lump-sum payments were due under the accident law, the capital necessary was transferred to the National Old-Age and Invalidity Insurance Institution, by which the annuities were paid.

SOURCES OF INCOME.

Notwithstanding the important extension of benefits by the law of April 22, 1905, granting widows and orphans' pensions, the general scale of benefits paid by the mutual benefit society was somewhat lower than that of the pension fund. On the other hand, the cost of medical service and sick benefits was a charge which the pension fund was not called upon to meet. The sources of revenue of the mutual benefit society were numerous, as is seen from the following list:

1. Assets transferred to the society at the time of its organization, or to be transferred to it in conformance with the law of March 29, 1900 (surtax upon rates.)

2. The deductions from the members' pay.
3. Contributions from the railroad administration.

4. Income from fines and penalties imposed upon the railroad personnel.

5. The net proceeds of the sale of unclaimed articles found anywhere on the railroad premises.

6. The net proceeds from the sale of railroad tariffs and timetables.

7. The unclaimed overcharges on freight. 8. Excess sums found in the cash accounts of stations. 9. Donations and legacies without special designation of purpose. 10. All other revenue which may be assigned to the society. 11. Income for the investment of the funds.

MEMBERS' CONTRIBUTIONS.—Most of these sources of revenue were indefinite, contingent upon many other conditions; but the contributions of the employees and employers were strictly established by the constitution.

The ordinary members contributed until October 21, 1902, 3 per cent, and since that date 31 per cent of their salaries and other emoluments for contract work, overtime, etc. As in the case of the pension funds, these contributions were partly offset by an annual redistribution among those members who are subject to the accident law of one-half of the reimbursements from the railroad administration to the society for payments under the accident insurance. The reason for such redistribution is patent. As the mutual benefit society out of its own funds compensated for invalidity due to accidents those of its members who were not protected by the accident law and was reimbursed when granting accident compensations to persons so protected, it is evident that a portion of its revenues was expended in a form of benefits, payable only to those of its members not otherwise provided for, and if their contributions were equal to those of the members protected by the accident law, then in view of the mutual character of the society, one class of members would be contributing for the benefit of the other class. The amount so distributed was very slight however.

The "aggregate” members, whose rights to benefit were rather limited, paid only 1 per cent of their salary.

EMPLOYERS' CONTRIBUTION.- The regular contributions of the railroad administration were increased twice since their reorganization in 1890. Up to October 21, 1902, they amounted to 3 per cent, or were equal to those of the employees. From October 21, 1902, to December 31, 1905, they were 4.2 per cent, and since January 1, 1906, they became very heavy, amounting to 8.15 per cent of the annual wages of the “ordinary” members. It contributed nothing on account of the "aggregate" members. This contribution was increased since the nationalization of the railroad business, when pensions to widows and orphans were introduced, thus considerably reducing the difference between the respective benefits of the better paid members of the pension fund and the lower paid members of the mutual benefit society.

ADMINISTRATION.

The rules for administration of the mutual benefit society were practically identical with those of the pension fund.

STATISTICS.

MEMBERSHIP.—The movement of the membership of the three mutual benefit societies is shown in the following table. The decrease in membership was even more rapid than in the case of the pension funds, for a large proportion of the members were employees of the lower grades, in which changes are more frequent and tenure of service less secure. As was explained above, there were two grades of membership, “ordinary” and “aggregate," the latter holding membership in the pension fund at the same time. The total average annual membership decreased from 60,851 to 36,789, or nearly 40 per cent. The greatest reduction was in the number of "aggregate” members, which was reduced to less than one-half, decreasing from the time of the first reorganization of the society in 1890. The number of "ordinary" members began to decrease in 1896, when admission of new members was discontinued. The decrease of members proceeded from two reasons, not only because of separation from the service, through death, invalidity, resignation, dismissal or any other reason, but also by promotion from a daily wage to a monthly salary, which carried with it a transfer from membership in the mutual benefit society to that in the pension fund. AVERAGE ANNUAL MEMBERSHIP OF THE THREE MUTUAL BENEFIT SOCIETIES,

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The number of employees separated from the service through disability, death, resignation or dismissal is shown for the mutual benefit societies as far as data were available in the following table. The rate of retirement is somewhat lower than that of the membership of the pension funds, because there is no provision for regular old-age retirement and because of the transfer of large numbers of older men to the pension funds. The death rate does not appear to be much greater than for the pension fund membership.

MOVEMENT OF MEMBERSHIP IN THE MUTUAL BENEFIT SOCIETIES, 1902 TO 1907.

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SALARIES. -For the proper appreciation of the data concerning the pensions granted it is necessary to get a clear idea as to the average salaries paid, and such data would be meaningless unless given by separate occupational groups. Such data are presented in the following table, as far as available, namely, for the Adriatic fund for 1890 to 1903 and for the Mediterranean fund for 1890 to 1901. In the original reports of the Adriatic fund the wages were stated by the day for 1890 to 1892, and in the subsequent years they were stated in computed annual amounts on the assumption of 340 working days per annum. The same method of computation was therefore used for the earlier three years as well.

The average earnings of the entire membership of these societies are only about one-half of that of the members of the pension funds. This is partly due to the inclusion of the female employees in the track service who are paid a mere pittance of about $33 to $35 per annum. But the differences are considerable even if separate groups are considered, which clearly indicates that the lower-paid portion of the personnel held membership in the mutual benefit societies. Some increase in the average salary has been noticeable, but not so great as in case of those who belonged to the pension funds. There is practically none as far as the Mediterranean society is concerned for the years 1890 to 1901, and the increase in the Adriatic society seems to be due mainly to the rapid decrease in the number of employees of some low-paid groups. As the promotion of an employee to a higher group was followed by his transfer to the pension fund, this explains the slow rate of increase of the average salary.

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