Page images
PDF
EPUB

is devoted exclusively to the interest of the veterans, but we think it should be operated in cooperation with the regular United States Employment Service of the Bureau of Employment Security. ... Now, it was set up under a Veterans' Placement Service board. To a large extent, though, it was operated as a part of the United States Employment Service, correlating its activities from the standpoint of personnel, offices, equipment, and so forth. What we will have, as I understand it, in the Department of Labor will be almost identical with what we have at the present time under the Federal Security Agency. For example, if you will read the plan, you will note that in transferring the functions of the Veterans' Employment Service Board to the Secretary of Labor, he will then act in lieu of the Board, or he will delegate-not to just anyone in the Labor Department, but he will delegate that authority to the Chief of the Veterans' Employment Service. In other words, the policy of the Veterans' Employment Service will stem directly from the Secretary or the Under Secretary, or will be transferred to the Chief of the Veterans' Employment Service, and not through any of the other officers, or functions of the Department of Labor.

There is a very direct tie-in between the Veterans' Employment Service, from the standpoint of administrative policy matters and personnel matters, and the Secretary of Labor; and not through all of the other subordinates in the Labor Department.

So I think they have safeguarded it pretty well, to give us as closely as possible almost a separate identifiable employment service, but maintaining at the same time the necessary coordination and liaison with the Bureau of Employment Security.

Senator Ives. Then I take it your principal interest here is to make sure that the Veterans' Employment Service is merged with the United States Employment Service wherever that service may be, and that you prefer that it rest in the Labor Department. Is that it?

Mr. KETCHUM. At the present time, yes.

Senator IVES. The principal interest of the VFW is in getting it into the United States Employment Service.

Mr. KETCHUM. That is right; working in coordination with the United States Employment Service, and yet preserving sufficient autonomy of the Veterans' Employment Service so that it will not become completely a creatude of the whims of any of the subordinates in whatever department it is in which it rests. And we think under the manner in which it is set up, those safeguards are there.

Senator Ives. Assuming such safeguards were set up anywhere else, I take it you would be satisfied.

Mr. KETCHUM. Oh, yes. The only thing is, Mr. Chairman, that we feel, as many of the other speakers have said, that there does seem to be a very direct relationship between the functions and operation of the Department of Labor, and the Employment Service. Of course, time alone will determine whether some of the apprehensions that have been expressed here will materialize. I don't know. As for some of the gentlemen who have objected to this thing, maybe within a year or two it may be determined that they were right in their apprehensions or fears. But I think that is something that only time can determine. I think you will appreciate that, Mr. Chairman.

Senator Ives. Thank you very much, Mr. Ketchum. I am sorry you had to hurry.

Before this hearing adjourns, I should like to enter into the record a telegram from Mr. William Green, president of the American Federation of Labor, and another telegram from Mr. Nelson Cruikshank, director of social insurance activities of the American Federation of Labor, together with a statement by Mr. Cruikshank, which will be entered in full. Mr. Cruikshank was supposed to be here this morning, but for reasons which he could not avoid, he was detained and could not be. Without objection that will be done.

(The material referred to is as follows:)

Hon. JOHN L. MCCLELLAN,

WASHINGTON, D. C., July 15, 1949.

Chairman, Senate Committee on Expenditures in the Executive Departments, Senate Office Building, Washington, D. C.

Am informed your committee plans hearings on July 25 on subject of President's Reorganization Plan No. 2. On behalf American Federation of Labor am requesting opportunity to present our views on this important subject. If you will kindly notify me as to the time we can be heard I will designate a representative.

Hon. JOHN J. MCCLELLAN,

WILLIAM GREEN, President,
American Federation of Labor.

WASHINGTON, D. C., July 27, 1949.

Chairman, Senate Committee on Expenditures in the Executive Departments,
Senate Office Building, Washington, D. C.

Regret unable to appear before your committee as scheduled Thursday morning July 28 to present in person position of American Federation of Labor in support President's Reorganization Plan No. 2. At President William Green's request am asking that my statement sent to Committee Clerk Reynolds last Friday be incorporated in record of hearings together with brief material which will follow by mail.

We fully appreciate that the necessity to postpone the time of my appearance from that originally scheduled on the 26th could not be avoided by your committee. The time set for today, however, ran into other previous commitments and after discussion with President Green and in consideration of the pressure of time under which your committee is operating it was thought best that we make the request contained in this telegram.

After the original arrangements for hearings were made I had a communication from Mr. A. E. Lyon, executive secretary of the Railway Labor Executives' Association, asking that I indicate to you and the members of your committee that the position taken by the American Federation of Labor on Reorganization Plan No. 2 was also the position of his organization. I had intended to ask that this letter be incorporated in the record of the hearings when I appeared. This letter is enclosed and I respectfully ask now that it be included in the record.

While I was attending the hearings on the morning of the 26th I heard the presentation of the statement of Mr. Robert E. Hatton, an employer representative of the Kentucky Unemployment Insurance Advisory Council. Mr. Hatton's statement included the presentation to your committee of a resolution which as I recall he stated was adopted unanimously by the members of the Kentucky Unemployment Insurance Advisory Council including the employee representatives. Inquiry has revealed that of the four employee members of this advisory council one has resigned, another was not present at the meeting where the resolution was adopted and the two remaining employee representaitves dissented. There is enclosed a copy of this original resolution indicating the dissenting votes of the two employee representatives who were present. It will be noted that the correctness of the copy of this resolution is certified to by Agnes S. Wheat, notary public. The notary is employed in the office of the Kentucky Department of Economic Security. I believe it is only fair that the impression left on the members of the committee by Mr. Hatton's statement should be corrected and I therefore respectfully ask that you bring this certified copy of the resolution to the attention of the other members of the committee and have it incorporated in the record of the hearings.

2

Sincerely and respectfully yours.

NELSON H. CRUIKSHANK, Director,
Social Insurance Activities, AFL.

(Mr. Cruikshank's prepared statement is as follows:)

[From American Federation of Labor information and publicity service]

(Following is the text of testimony presented today by Nelson H. Cruikshank, director of social insurance activities of the American Federation of Labor before the Senate Committee on Expenditures in the Executive Departments in relation to President Truman's Reorganization Plan No. 2 of 1949)

Mr. Chairman, my name is Nelson H. Cruikshank, and I am director of social insurance activities for the American Federation of Labor.

I wish at the outset to thank the committee for permitting me the opportunity to present the views of the American Federation of Labor on the President's Reorganization Plan No. 2 which provides for the transfer of the Bureau of Employment Security from the Federal Security Agency to the Department of Labor and for such changes in the organization of that Department as are made necessary by the plan including authorization of wider responsibility for the tripartite Federal Advisory Council.

In order that it may be perfectly clear that the position that I present to this committee is in complete harmony with the official position of the American Federation of Labor, I should like at this point to have included in the record a copy of a resolution which was unanimously passed by the sixty-seventh convention of the American Federation of Labor in Cincinnati, Ohio, November 20, 1948.

"We note the rejection by Congress of the President's proposal to place the USES and the Bureau of Employment Security in the Department of Labor. It is a policy long advocated by the American Federation of Labor that all labor functions should be located in labor's special Department. The promised restoration of the Department of Labor should include the transfer of these two agencies as well as all other agencies serving labor" (Reference: P. 419, official proceedings, sixty-seventh convention, American Federation of Labor).

This action was taken by the convention, reaffirming positions repeatedly expressed in the past on the basis of wide experience and in the belief that a proposal such as that now contained in the Reorganizaiton Plan No. 2 provides the soundest administrative pattern for the economical and efficient operation of an employment security program.

There is apparently no disagreement concerning the necessity of having the two agencies which deal with the matter of employment security located in the same department of the Federal Government. Reorganizaiton Plan No. 2 of 1947, you will recall, provided for the retention of the USES within the Department of Labor, but failed of approval by the narrow margin of one vote in the Senate, largely on the basis of the contention that the Employment Service and unemployment-compensation programs would under that plan be administered in separate agencies. The plan your committee is now considering meets this objection by placing both parts of the program in the same Department. This will make immediately and directly available all of the statistical and informational services relating to the labor market now within the Department of Labor to these offices whose functions relate specifically to employment.

Reorganization Plan No. 1 of 1948 was opposed on the ground that action on the matter should await the recommendation of the Hoover Commission. The Hoover Commission has submitted its report, and this plan is a part of the President's stated purpose to implement the program the Commission recommended. There would now appear to be no logical basis for opposition, since both previous objections have been met.

The proposal, in addition to bringing together at the Federal level these closely related functions, would provide an administrative and organizational pattern which would be in conformity with the predominant pattern of administration of the corresponding agencies within the States. Attached to this statement there is a list of 16 States, including such major industrial States as New York, Pennsylvania, Illinois, Connecticut, Massachusetts, and New Jersey, in which the unemployment-compensation agencies and employment services are located in the State departments of labor or comparable departments. In addition, there is a list of six States which have the two agencies located in departments having other labor functions. It is equally important to note that in not one State are these two agencies located in the State department of public welfare or other State agency having responsibility for public health, education, or other matters similar to those which constitute the main responsibilities of the Federal Security Agency.

Throughout its history the Department of Labor has been devoted to the purposes set forth in the act of 1913 establishing the Department, and in fulfilling its obligations it has rendered valuable assistance to wage earners in achieving the highest living standards enjoyed by workers anywhere in the world. It has done so without being destructive of other interests, for while the living standards of American workers have steadily improved through the last 36 years, industry has also prospered and agriculture has advanced.

The Department of Commerce has been of great assistance to members of the business community, and this is as it should be. Likewise, the Department of Agriculture has been of tremendous value in assisting the farmers of our Nation to improve their conditions. Affairs of government which relate to industry and business management properly belong within the Department of Commerce and affairs of government of special interest to farmers belong within the Department of Agriculture. We would not have it otherwise. But we insist that affairs of government which relate to employment and to labor belong within the Department of Labor. Otherwise there is no reason for having a Department of Labor. Surely no governmental function can be more closely related to the purpose of advancing "opportunities for profitable employment" than the United States Employment Service. It belongs in the Department of Labor by definition.

The limited responsibilities for the administration of unemployment compensation which under our laws belong to the Federal Government are likewise labor functions, since they deal with the employment relationship, and since they are of direct concern to both industry and labor. The unemployment-compensation program is an insurance system which provides partial compensation for wage losses arising from involuntary unemployment. It is not a relief program administered in relation to need, and is therefore not properly a responsibility of a department or agency whose main functions relate to the administration of public welfare. It is concerned with bringing about a greater measure of employment stability and job continuity.

One phase of the President's plan has not, in our opinion, been given the attention that its importance merits. That is, that it includes broadening the functions of the tripartite Federal Advisory Council which was originally set up under the provisions of the Wagner-Peyser Act to advise the Secretary of Labor. Upon the adoption of the plan, this Council will become the group in which representatives of management and labor and the public will develop policies for the operation of the employment service and the unemployment-compensation programs insofar as these policies are determined at the Federal level. We in the American Federation of Labor have had long experience in serving on such advisory councils, and we thoroughly believe that with the inevitable extension of administrative law such councils offer an appropriate and effective means of guiding bureaus and agencies of government in the interests of those most directly affected and in the interest of the general public without diluting administrative responsibility.

When the manpower problem became acute during World War II the USES was, in effect, the operating division of the War Manpower Commission, and the policies of the WMC were developed by a management-labor policy committee which included in its membership the representatives of industrial management, of labor, and agriculture. Under the policies and programs recommended by this tripartite committee this Nation not only achieved the greatest production record in history but remained throughout the war the only major nation engaged in that great struggle which did not have to resort to national service legislation. It was my privilege to serve as the executive assistant to the labor members of this committee and, while I can recall that many sharp differences developed between the representatives of management and labor, the policies agreed upon by that group were in the end accepted unanimously.

Surely nothing could be more appropriate to our democratic way of life than to provide that the guiding policies of a Federal office dealing with matters of employment and unemployment should come out of a free consultative process among the representatives of the groups most directly concerned with the operation of such programs. I stress this point because it appears that some representatives of business-management who have expressed their distrust of the Department of Labor have failed to recognize that the plan provides adequately for their participation in the development of the policies that would guide the Secretary of Labor in the administration of the employment-security program. This advisory council is now in existence within the Federal Security Agency and there is attached to this statement a list of the representatives of the public, of industrial management, labor, and veterans' organizations which presently comprise its membership.

The plan which your committee is now considering represents a step forward in progressive reorganization of Government responsibilities. It provides for bringing into the United States Department of Labor functions which properly should be administered within that Department and makes adequate provision for the coordination of the interrelated programs. It provides sound administrative procedures for the operation of these programs and authorizes a tripartite advisory council which will represent all interested groups in the formulation of policies in accordance with our best democratic traditions and experience. This plan therefore carries out both the spirit and letter of the Reorganization Act of 1949 and the recommendations made by the Commission on Organization of the Executive Branch of the Government. The American Federation of Labor therefore earnestly urges this committee to take favorable action on this plan.

ATTACHMENT I

STATES WHICH HAVE UNEMPLOYMENT COMPENSATION AND EMPLOYMENT SERVICES IN A STATE DEPARTMENT OF LABOR OR COMPARABLE DEPARTMENT

[blocks in formation]

STATES WHICH HAVE UNEMPLOYMENT COMPENSATION AND EMPLOYMENT SERVICES

LOCATED IN A DEPARTMENT HAVING OTHER LABOR FUNCTIONS

[blocks in formation]

Dr. William Haber, professor of economics, University of Michigan, Ann Arbor, Mich., Chairman of the Council.

Mr. Max F. Baer, national director, B'nai B'rith Vocational Service Bureau, Washington, D. C.

« PreviousContinue »