Developments in Industrial Relations'

ESTABLISHMENT of a new Wage Stabilization Board with enlarged jurisdiction and membership and the resumption of labor's participation in other defense mobilization agencies were important developments in industrial relations activities during April 1951. Significant, too, was the approval by the Economic Stabilization Administrator of a contractual cost-of-living increase of 6 cents an hour for nonoperating railroad employees; existing wage limitations were exceeded by this action. In the textile industry, virtual ending of the prolonged woolen and worsted strike and continuation of the southern cotton and rayon stoppage were other highlights of this period.

Defense Mobilization Policies

The month was one in which several defense labor policies were clarified.

New Wage Stabilization Board. The President issued, on April 21, an Executive order which followed recommendations, made by a majority of the National Advisory Board on Mobilization Policy, for establishing a new Wage Stabilization Board with enlarged jurisdiction and membership. The Advisory Board, on April 17, had voted 12 to 4 (industry members dissenting) for creation of such an agency. Industry spokesmen had contended that the new Board's jurisdiction should be confined to disputes arising out of wage stabilization policies.

The Executive order established an 18-member tripartite Board with the public, labor, and industry each represented by 6 members, in contrast to the former 9-member tripartite Board. The new Board may make recommendations for the settlement of any labor disputes which

threaten to interrupt work affecting the national defense, in the event that: "(a) The parties to any such dispute jointly agree to submit such dispute to the Board for recommendations or decision" or, "(b) the President is of the opinion that the dispute is of a character which substantially threatens the progress of national defense and refers such disputes to the Board." Binding decisions are authorized only if the parties jointly agree to such action in advance.

The order directed also that no action shall be taken "inconsistent with" the provisions of the Labor Management Relations Act of 1947 or with other applicable labor laws.

Dr. George W. Taylor (University of Pennsylvania), former chairman of the National War Labor Board during World War II, was appointed chairman and one of the six public members of the new Wage Stabilization Board. The other 17 members named to the Board are:

Public: Clark Kerr, University of California, vice chairman of the Board; Nathan P. Feinsinger, University of Wisconsin; William M. Hepburn, Emory University Law School; John Dunlop, Harvard University; and Frederick Bullen, N. Y. State Mediation Board.

Industry: Milton M. Olander, Owens-Illinois Glass Co.; Alexander R. Heron, Crown-Zellerbach Corp.; Richard P. Doherty, National Association of Broadcasters; Henry B. Arthur, Swift & Co.; J. Ward Keener, B. F. Goodrich Co.; and Reuben B. Robertson, Champion Paper & Fibre Co.

Labor: CIO-Joseph A. Beirne, Communications Workers; Emil Rieve, Textile Workers; and John W. Livingston, United Automobile Workers. AFL-Harry C. Bates, Bricklayers, Masons, and Plasterers; William C. Birthright, Barbers, Hairdressers, Cosmetologists and Proprietors; and Elmer E. Walker, International Association of Machinists.

Messrs. Kerr, Dunlop (public); Bates, Rieve, Walker (labor); and Arthur, Keener, Robertson (industry) were all members of the former Wage Stabilization Board.

New salary stabilization machinery, under a three-member Salary Stabilization Board, was established early in May by the ESA Administrator. The newly created board will be responsible for policy affecting compensation of executive,

administrative, professional, and certain sales and supervisory employees, when they are not represented by recognized labor organizations. In addition to the three regular members to be named, the Chairman of the Wage Stabilization Board will serve as a nonvoting ex-officio member.

United Labor Policy Committee. On April 30, the United Labor Policy Committee instructed labor's representatives to return to all defense mobilization agencies from which they had resigned in February. It named George M. Harrison, president of the Brotherhood of Railway Clerks (AFL) to be special assistant to the Director of the Office of Defense Mobilization. David McDonald, secretary-treasurer of the United Steelworkers (CIO) was named to succeed Mr. Harrison as assistant to the Economic Stabilization Administrator. Al J. Hayes, president of the Machinists' Union (AFL) will return to his former position as manpower consultant to the Assistant Secretary of Defense in charge of manpower.

The committee noted that significant policy changes had recently occurred which took favorable account of labor's dissatisfaction with various aspects of the defense mobilization program. These changes involved establishment of the National Advisory Board on Mobilization Policy, with direct access to the President; a new Wage Stabilization Board; and an agreement on the handling of defense manpower controls.

Manpower Coordination. The manpower agreement provides for the establishment of a labormanagement committee on manpower policy with two co-chairmen-Dr. Frank P. Graham, Defense Manpower Administrator in the Labor Department, and Dr. Arthur S. Flemming, Chairman of the Manpower Policy Committee of the Office of Defense Mobilization.

Railroad Nonoperating Employees

A cost-of-living wage increase, amounting to 6 cents an hour and affecting approximately a million nonoperating railroad workers, was approved on April 24 by the Economic Stabilization Administrator. The increase had accrued on April 1 under an "escalator" provision included in an agreement which had been reached by the

Nation's railroads and 15 nonoperating railroad brotherhoods a month earlier. Under the stabilization regulations, however, only 2 cents of the 6-cent increase would have been permissible because wage increases negotiated after January 25, 1951 (date of the general wage stabilization order) were limited to 10 percent above the rates prevailing on January 15, 1950.

to

The Administrator's approval of the 6-cent increase was based upon recommendations made by a Temporary Emergency Railroad Wage Panel which he had appointed on April 9, pursuant a Presidential directive. The panel was instructed to review and report on the merits of the nonoperating railroad agreement which had been concluded after several months of negotiation. The Panel's report emphasized that its recommendations were "not intended to be of general applicability but are strictly limited to a case-by-case approach" and based its recommendations principally on the following considerations:

(1) Existing wage stabilization regulations are inappropriate to resolve equitably or practically the unique collective-bargaining problems in the railroad industry.

(2) The pattern of escalator clauses in the railroad industry had already been established before January 25, 1951, by agreements concluded, and currently in effect, between the railroads and the Switchmen's Union and the Railroad Yardmasters (both AFL). Inequities would result, the panel reasoned, if the Switchmen's and Yardmasters' pre-stabilization escalator clauses could exceed the existing 10-percent wage limitation, while "nonops" were denied the same treatment. Also it would be unfair to penalize railroad employees for the "slowness of their collectivebargaining procedures when that slowness is itself the result of a system of bargaining imposed by Act of Congress on them alone."

(3) The escalator clause, which was included in the March 1 nonoperating agreement, was gained only after the unions agreed not to seek any general wage increase for a 3-year period, and accepted a general wage increase limited to 12%2 cents an hour. Disapproval of the above-ceiling nonoperating escalator increase would require renegotiation of the entire agreement; the result

would be "either no agreement, or agreements without any term, and in any event a disturbed state of affairs on the railroads which ought to be avoided in the national interest."

Textile Disputes

By mid-April the prolonged strike involving woolen and worsted mills, located mainly in the New England and Mid-Atlantic States, and the Textile Workers Union (CIO) was virtually ended. Settlements, reached by the union with numerous individual mills, followed the agreement concluded with the American Woolen Co. in mid-March. A wage increase of 12 cents an hour, an escalator clause (1 cent for every 1.14 point increase in the CPI), and insurance and severance pay benefits were incorporated in most of the contracts signed.

On the other hand, the strike, which began April 1 and involved some 40,000 southern cotton and rayon workers, also members of the TWUA, continued throughout the month. Approximately 50 mills in seven Southern States-North Carolina, Virginia, Alabama, South Carolina, Tennessee Louisiana, and Georgia-were affected.

Dan River Mills (Danville, Va.), one of the largest firms involved in the strike, on April 16, announced a 2-percent wage increase offer based on existing wage stabilization limitations. The union countered that the company could grant, or agree to, a more liberal wage adjustment, retroactive to the date of their negotiations, subject to Government approval. A union proposal, made on April 20, to submit the issues in dispute to the Wage Stabilization Board, was rejected by the company on the grounds that "membership, function, or power" of the Board had not yet been finally determined. Several acts of violence-the shooting of a picket, police use of tear gas to disperse pickets, and the firing of shots into the homes of two mill workersoccurred at this company's plants on April 17 and 20.

On May 5, the policy committee of the union recommended to its locals that the strike be terminated. The action complied with a request by the Director of the Federal Mediation and Conciliation Service, that the strike be ended in the interests of national defense. The Director had declared that if production were resumed,

he would appoint a 3-member tripartite mediation panel with authority limited to aiding the parties in order to negotiate a settlement. Several days later he named a special panel to seek settlement of the dispute.

Detroit Transit Stoppage

Approximately 3,800 Detroit streetcar and bus operators, members of the Street, Electric Railway and Motor Coach Employees Union, Division 26 (AFL), stopped work on April 21. This action followed rejection by the municipally owned Detroit Street Railways of the union's request for a wage increase of 81⁄2 cents an hour, without loss of fringe benefits. An additional 2,450 maintenance and office workers had been made idle by April 28. Negotiations for a settlement of the strike continued during the first week of May.

All but several hundred of the transit operators were designated as strikers by the Street Railway Commission and were discharged on April 25 under authority given by the 1947 Hutchinson Act-an act prohibiting strikes by public workers. This State law provides that discharged strikers shall lose all rights and benefits, including pension and retirement benefits, unless reappointed or reemployed. If they are rehired, strikers may not receive more compensation than they received prior to the violation; may not receive any pay increase for 1 year; and are placed on probation for 2 years.

Strike Postponements

Shipbuilding. A Nation-wide strike by 50,000 shipyard workers, scheduled to begin May 3, was deferred for 30 days. This was the second 30-day postponement of the threatened strike.

The recent action was announced on May 1, after representatives of the Marine and Shipbuilding Union (CIO) had conferred with the Chairman of the new Wage Stabilization Board. During the 30-day postponement, the Board will consider agreements covering some 40,000 shipyard employees and providing for an average wage increase of 15 cents an hour. These agreements were negotiated by the union with Bethlehem Steel and 31 other companies.

Meatpacking. Postponement, until May 20, of a Nation-wide meatpacking strike originally sched

Publications of Labor Interest

EDITOR'S NOTE.-Correspondence regarding publications to which reference is made in this list should be addressed to the respective publishing agencies mentioned. Data on prices, if readily available, were shown with the title series.

Special Reviews

The Attack on the Cost of Living Index. By Kathryn Smul Arnow. Washington, Committee on Public Administration Cases, 1951. 166 pp., charts; processed. $1.75.

Mrs. Arnow's dissertation, which began as an academic case study of a government technical agency under political attack, has a lively relevance today.

In July 1942, with almost casual reference to the Bureau of Labor Statistics' cost-of-living index, the War Labor Board decided that a 15-percent wage increase over the levels of January 15, 1941, would be a "fair and equitable" adjustment of wages and so announced the "Little Steel" decision. In short order the award became a "formula" and, following the President's "hold-the-line" order, a tightly held rein on labor's wage demands.

As the unions soon reached the end of the tether, it was almost inevitable that they scrutinize the length of the line holding them back. The cost-of-living index, they declared bitterly, had a downward bias. It failed, they claimed, to reflect accurately workers' family expenditures or to measure deterioration of goods, etc. So, out of the blue, virtually, the BLS quickly found itself in the midst of a raging tempest.

With justifiable pride in its competence, the BLS sought to answer the criticisms on technical grounds. It pointed out that its index was not a cost-of-living index, in much of the common-sense use of the term, but an index of retail prices of a selected group of commodities in a selected group of cities-in effect, a consumers' price index. It admitted that the index could not measure hidden changes in the standard of living (e. g., quality deterioration) but that the index fully met the purposes for which it had been designed.

Because of the questions raised, the BLS invited the American Statistical Association to examine its methods. An ASA committee, headed by Frederick Mills, after due examination fully endorsed the Bureau's competence. Yet labor's attacks were not stilled. A. F. Hinrichs, acting head of the BLS, thought that if he could speak direct to the labor leaders, rather than to the union technicians, with whom the Bureau traditionally dealt, he

index. But Hinrichs found that the Bureau had few such contacts, and that most of the labor people were not interested in technical arguments. From their point of view, the index was not measuring "cost of living" and that was all they cared about.

President Roosevelt appointed a special committee, headed by William H. Davis, to investigate the index. The labor people turned the committee into a public rostrum for an attack on the BLS. Their own statistics "proved" that prices had risen 43.5 percent from January 1941 to December 1943 as against the BLS figure of 23.4 percent.

A new technical committee, headed by Wesley Clair Mitchell, was appointed by Davis. It, too, examined the index and also substantially upheld its accuracy. It did, however, make an "educated guess" that the index was 3 to 4 points off, because of its inability to analyze hidden changes in living costs, but not 20 points. The strategic importance of Mitchell's bold "guess" was that it contraposed a specific figure to labor's data and thus reduced the ground of argument from rhetoric to analysis. Both the BLS and the Mills committee had been hesitant about making such statements.

Mrs. Arnow reaches few conclusions in her careful and meticulous presentation of the record. From her data, and in view of a possible repetition of the issue today, with so much at stake in escalator clause agreements, some assessments can and should be made. The BLS as a technical agency was understandably bewildered at the partisan onslaught from a group which it considered friendly. Yet instead of meeting the issue in its own terms, namely to distinguish between political and policy (and value) problems and technical criteria, the Bureau adopted what some considered an attitude of timidity. Some of the staff felt early in the dispute that the Bureau ought to issue a public statement on difficulties of measuring wartime prices and thus disarm the critics. They argued for full disclosure of the statistical problems. Others felt that any admissions might hurt the standing of the Bureau. Yet one cannot, it seems to the reviewer, ignore the policy uses and policy consequences of a technical instrument. For that reason, admission of its limitations and explanation of varieties of use and misuse are both valor and prudence combined. In this respect, the action of the Bureau in changing the name of the cost-of-living index to the more accurate consumers' price index, and the more recent action incorporating the new rent factor and a modified weighting pattern in the current index, seem to be wise decisions.

However, what Mrs. Arnow curiously seems to have missed altogether, and what is of paramount importance in understanding the larger implication of labor's attack on the cost-of-living index, is that the attack on technical grounds was the only one open to labor because its own political relation to President Roosevelt tied its hands politically. And quite shrewdly, and for his own purposes, President Roosevelt pursued the same course by creating a President's Committee to appraise the BLS index, rather than the adequacy of the WLB's Little Steel