Company scrip is scrip (a substitute for government-issued legal tender or currency) issued by a company to pay its employees. It can only be exchanged in company stores owned by the employers. In the UK, such truck systems have long been formally outlawed under the Truck Acts.
In the United States, mining and logging camps were typically created, owned and operated by a single company. These locations, some quite remote, were often cash poor; even in ones that were not, workers paid in scrip had little choice but to purchase goods at a company store, as exchange into currency, if even available, would exhaust some of the value via the exchange fee. With this economic monopoly, the employer could place large markups on goods, making workers dependent on the company, thus enforcing employee "loyalty".
Lumber company scrip
In 19th century United States forested areas, cash was often hard to come by. This was particularly true in lumber camps, where workers were commonly paid in company-issued scrip rather than government issued currency.
In Wisconsin, for example, forest-products and lumber companies were specifically exempted from the state law requiring employers to pay workers' wages in cash. Lumber and timber companies frequently paid their workers in scrip which was redeemable at the company store. Company-run stores served as a convenience for workers and their families, but also allowed the companies to recapture some of their labor expenses. In certain cases, employers included contract provisions requiring employees to patronize the company stores. Employees who wanted to change their scrip to cash generally had to do so at a discount.
Lumber company scrip was redeemable in lumber as well as other merchandise. According to the Wisconsin Historical Society, such an option may have appealed to new settlers in the region, who worked in the lumber camps in winter to earn enough money to establish a farm. Taking some of their wages in lumber may have helped them build a much-needed house or barn.
Coal company scrip
Coal scrip is "tokens or paper with a monetary value issued to workers as an advance on wages by the coal company or its designated representative". As such, coal scrip could only be used at the specific locality or coal town of the company named. Because coal scrip was used in the context of a coal town, where there are usually no other retail establishments in that specific remote location, employees who used this could only redeem their value at that specific location. As there were no other retail establishments, this constituted a monopoly. The country musician Merle Travis makes a reference to coal scrip in the song, "Sixteen Tons" on the Folk Songs of the Hills album.
The practice has been documented as recently as September, 2008. On September 4, 2008, the Mexican Supreme Court of Justice ruled that Wal-Mart de Mexico, the Mexican subsidiary of Wal-Mart, must cease paying its employees in part with vouchers redeemable only at Wal-Mart stores.
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