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Mr. Thomas. The result is, when we talk of eight hours per day, we do not mean six days consecutive eight hours. It works out nine and a half for five days in the week, or whatever it may be, and the short day of Saturday.

Col. ULLMAN. I see. That is what I wanted to know. While I am on my feet, I might add this, not in the nature of replying to any of your remarks; but I do hope that you have not any idea that all the employers of labor are trying to "do" the laboring man at this time. That is rather what you intimate, and I trust

The CHAIRMAN. Pardon me; if I have left that impression upon the mind of any man or woman here, I hope I may have the opportunity of correcting it, because that is not what I meant to convey. I know that the employers generally are fair-minded and fair dealing.

Col. ULLMAN. I hope you feel that way, because I believe at a time like this nobody has a patent on patriotism; and the employers, I think you will find, as a general proposition are as patriotic as the employees; and I have not the slightest doubt that vice versa will be also the case.

As to this question of collective bargaining, I am not going to argue with you, but I would say this to you: I have been connected with our concern now 40 years. It is 40 years this month since I entered our factory, and I have grown up, with our people. Our factory is not organized. Various attempts have been made to organize it, all of which have thus far failed. I stood in front of the factory two years ago when a meeting had been advertised to be held in the noon hour at the public square, a block and a half from our factory, and people held large signs at the exits calling attention to the fact. Our employees, as they went out, said, “Why do we want to go to the meeting?" We have 1,800 employees. There were 35 present at the meeting. Now, you do not understand, I think, our standpoint, and perhaps I do not understand yours.

The secretary of our trade council, who was a schoolmate of mine, called on me some time ago and discussed the question with me; and after talking with me for a while he said: “You used to be a fine fellow some years ago, but lately, now that you have been associated with the plutocrats, you can not see our point of view." I said to him: “If you worked as many hours a day as I do, you would really be a workman.” Now, that is our different point of view, you know. You do not quite understand ours, and perhaps I do not understand yours. But the fact is, Mr. Gompers, if I may say so frankly, as I said before, I think, as our friend Thomas said this morning, this is a game of give and take. The manufacturer must give way for the best interests of the country; and there may come a time when, in the game of give and take, neither side can take all and give nothing; and both sides, I am afraid and I hope, will both give and take at the proper time for the best interests of the country. [Applause.]

Mr. BRADY. Mr. Chairman, I should like to have Mr. Thomas or one of his colleagues inform me, in the event that there is any dispute between the employers and the employees, and this arbitration board is not able to bring the two sides together, does the Government on one hand step in and say to the workers, “ You must continue to work and supply the necessities,” or does it on the other hand, in the event that the employers are not willing to come around, take over the

plants and operate them until such time as the employers are willing to concede what seems to be a fair deal to the workers in those establishments?

Mr. Thomas. The first fallacy of the proposition is your assumption that what was a grievance under a private employer ceased to be a grievance when it became a Government employer. You see the fallacy of such a suggestion. That is all right; you will see that I am following you in a moment. You may not have stated your case as you intended, but that was the impression. What you said was, supposing there is a dispute, a grievance, and the employer does not rectify the grievance, and the board of arbitration does not rectify the grievance. Does the Government step in, then, and wipe away the employer and the men continue work until some solution is found?

I am pointing out to you that that presupposes that the men would work under the same grievance if it was a Government employer that they would not work under if it was a private employer. But at all events what you want to know, I presume, is, What is the exact machinery for settling a dispute by arbitration ?

Now, the munitions act that I explained this afternoon does not apply to every industry. It only applies to those engaged in essential war work. But you can quite conceive that there comes up the question of the definition of war work. A man may be making munitions, and that is war work; but if the carrier who was conveying the munitions went on strike and no one could carry the munitions away they would be useless. You can see that the carrying of the munitions is as essential as the making of them. You see that point. Therefore, although the man who is carrying the munitions and all these others are not under the munitions act, the Government by statute has the power to proclaim any industry within the munitions act; that is to say, that all the industries are not scheduled, as you call it, under the munitions act, but by proclamation the Government can bring into that schedule any industry, whatever it may be.

Now, then, there is a dispute, say, between the engineers and their employers and they ask for a 6 shillings per week advance in their wages to cover the increased cost of living—because I beg of you to distinguish that point. There has been no changed wage condition in our country since the day the war broke out. Now, keep that clearly at the back of your mind. Strong and powerful as we are, there has been no changed wage condition, no changed labor conditions. That does not mean that there have not been large increases of wages, because, as I explained to you, in the case of my own organization we have gotten 15 shillings per week increase in wages; but all the advances are not based upon the services rendered, but upon the fact that the increased cost of living has reduced the spending value of the money, which is an entirely different thing. If you were go to argue conditions of service, you would naturally point out the technicalities of your work, the urgency of your work, and the special method of labor applied to your work. None of those things arise. The only thing that arises in considering conditions of service now is the spending power of the sovereign. So I hope you will distinguish between the two.

Therefore, what the tribunal that is set up has to consider is not whether the engineer or the machinist is doing important work,

not whether the toolmaker is doing very essential work, but whether the toolmaker's wages or the machinist's wages or the engineer's wages have risen proportionately to the increase in the cost of living: Therefore, this board of arbitration that I have already described settles the question entirely upon that basis. The committee is composed, not of employers, not of employees, but of men of judicial ininds, independent of both sides. We are urging that it would be advantageous if it were composed of a direct representative of labor, a direct representative of capital, and an independent person as arbiter between the two. In many of our forms of conciliation and arbitration boards that is the tribunal now. But the machinery of the munitions act definitely prevents the employees striking whilst they are engaged on war work. Clearly that was the object of the munitions act, as I explained to you this afternoon.

Mr. BRADY. That is just what I wanted to bring out—if the workers had a right to quit if they did not like the award made by this Government board, or whether they were compelled to continue under pain of punishment.

The CHAIRMAN. That question has been answered.

Mr. HEWITT. Mr. Chairman, Mr. Thomas, through your address this morning and through your answers to the questions, the dominant note running through it all is cooperation. I hope that that cooperation will be exemplified by those representing the men and women of this country when we leave here to-night. I was unable to bear all of your address this morning, and perhaps you have covered the point I have in mind.

You said something about the men, the workers of Great Britain, volunteering to do munition work. The thought occurred to me that there are others who did not volunteer to do this work. I should like to know from you whether there are any restrictive measures placed upon the freedom of those who did not volunteer to do munition work to move about from place to place and seek employment in one city or another?

The CHAIRMAN. That has been answered.

Mr. THOMAS. No; there is no industrial compulsion in the country-none whatever.

Dr. MEEKER. I should like to ask by what methods contract prices are regulated as wages advance to meet the advance in the cost of living. That is a very practical difficulty that confronts us here now in the making of contracts. I have been asked to devise a means of meeting that difficulty, and I want to know how you have met it.

Mr. Thomas. The first point is that general experience proves that just as trades-unionism (which means combination) is advantageous to the workers and enables them to help each other, so capital, which sometimes denounces the methods of trades-unionism, has a much more perfect organization than those it condemns. The general experience of anyone who has had to deal with contracts is that the difference is often in form more than anything else. I have had very large experience in dealing with contracts, because I was the chairman of a municipality for a number of years, and my experience showed that there was very little difference in the prices, and the contractors generally knew the exact situation and made preparations for it.

So far as the Government is concerned, however—well, I am talking of my own country, and it is easier, from our point of view on the other side, for this reason: As I said this morning, and as it was explained to you, there are 5,000 controlled establishments; that is to say, where the Government have taken the whole of the plant, the whole of the machinery, they have not put men in to work them, but they have said to that firm, "Whatever your net earnings of 1913 or 1914 may have been, prewar, we will guarantee those earnings to you, plus 20 per cent more.” Not 20 per cent more dividend. Do not confuse the point, but 20 per cent increase on the net return for the year, with also an allowance for depreciation.

Now, lest some one should say, “ That is a good deal for the capitalist,” it is only fair to point out this: I can quite understand that there would be a criticism in saying, “Well, they are doing all right." On balancing the considerations I do not think they are, for this reason. I will give a simple illustration.

Suppose I was at the head of an aeroplane factory, where before the war there was no especial demand for aeroplanes, and my return on a £50,000 capital, by way of an argument, was £2,000 net. Suppose that was the position. I produced every year, or the year prior to the war, 50 aeroplanes, by way of a simple illustration; but I have the capacity in my stores, in my works and factory, to produce a thousand aeroplanes. The war has created a demand for aeroplanes. You see how absurd it would be, if the additional plant was producing 1,000 aeroplanes as against 50, to say that my profits must be regulated absolutely to a turnover of 50 as compared with 1.000.

I am giving this illustration for the benefit of our labor friends, so that they may see that whilst at first sight there may be a tendency to assume that this is an extraordinarily good bargain it will be seen that there must be some inducement to increase the production, or there would be no incentive whatever to do it. That was the arrangement that was the basis upon which these firms were controlled. There are very few contracts in munitions given out. I have already explained why. But in other forms of Government contracts, the fair-wage clause covers the point that you raise, because the employers, whoever they may be, on tendering have all got to take into consideration the fact that there is the fair-wage clause inserted, and that naturally compels them to recognize the district rate.

Dr. MEEKER. But suppose the rate of wages in the district goes up?

Mr. Thomas. You do not go to a revision of wages every two weeks or every two months, you see. You can quite understand that it would be absurd. There would be nothing else to do. The usual period for revision, based upon the cost of living, has now been established at four quarterly periods of three months, and the contractors are sufficiently alive to tender for the contracts to cover the period of the three months; and you will readily see that they then know the calculation of the wage increase for that period.

Dr. MEEKER. That is the point I wanted to bring out.

Mr. D'ALESSANDRO. Mr. Chairman, I listened to what was said this forenoon, and this point was not very clear to me: Mr. Thomas made the remark that before the European conflict his organization had so many members, but after this conflict began his organization increased numerically, which we have not. Was it compulsory to join the union, or voluntary to come in, I should like to know?

Mr. THOMAS. No; it was voluntary; but like everybody else, in coming over here, knowing the submarine menace, I took the precaution to get an additional life belt. The workers in general have at last awakened to the fact that the trades-union provides the life belt for them, and they are at last clinging to the life belt. [Applause.]

Mr. GOLDEN. Mr. Chairman, can Mr. Thomas stand another question?

Mr. Thomas. Oh, yes; with pleasure.

Mr. GOLDEN. I want to follow up the question asked by the president of the Cotton Manufacturers' Association, Mr. Bemis. What action or what machinery would be put into motion by the British Government if a case of this kind occurred: Our friend the shoemaker gave an illustration, but as I am a textile man I will confine mine to the textile industry.

Suppose a large manufacturing textile plant took a contract from the British Government to supply a large textile order within a given time, say three months, and suppose it was discovered that this textile plant could not fill that order unless it reduced its standards, unless it lengthened the hours. I do not know whether you have had any of these cases or not, but I am afraid we will have them here, because there is a movement on foot now by the southern cotton manufacturers, and the southern Congressmen and Senators are being flooded with requests to suspend the national child-labor law until the end of the war because they need the work of the children. Now, what would be the action of the British Government if a textile manufacturer took a contract, and it was discovered afterwards that he could not fill that contract unless he changed his standards?

Mr. Thomas. The first answer to your question is this: As has been made clear many times to-day, reactionary people will always take advantage of reaction; and therefore I am bound to say that with all the great resources of the United States, serious as is the position of the allies, I can not conceive that the assistance the United States can give to the allied cause is dependent upon any alteration in the child-labor laws of this country. [Great applause.] In any case, I should feel that we were indeed hard up if we have got to arrive at that stage.

What would happen in the emergency you mention is that in every contract there are certain penalties provided for the nonfulfillment of that contract. If the employer was able to give a legitimate explanation, clearly any sound and sane and honest and common-sense person, whether he be a Government official or not (if that type does exist in Government circles) would accept the explanation. [Laughter.] But, on the other hand, if the only excuse that the manufacturer could offer would be the abrogation of the child-labor laws of the country, I can hardly conceive of that being a satisfactory explanation.

Mr. STILLMAN. Mr. Chairman, as a teacher I am especially glad to have a chance to ask Mr. Thomas a question, because we have grown accustomed to looking at England as a Mecca-England, the country where the organized teachers have a member of Parliament of their own, where all the teachers are members of the organiza

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