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of work and increased productivity and that through the exercise of these rights they are being enabled to make their maximum contributions to the national war effort. If the rights and procedures of collective bargaining through organizations of their own choosing can secure these results among industrial workers, then they certainly can secure the same results from administrative, executive, professional, and supervisory workers. As a matter of fact, where such collective bargaining now exists, it has been a means of eliminating the obstacles to a maximum performance on the part of these employees.
Who are the executive, administrative, and professional employees? The standard definitions of these categories of workers were those drafted by the Wage and Hour Division of the United States Department of Labor, pursuant to section 13 (a) (1) of the Fair Labor Standards Act of 1938. The National War Labor Board in defining executive, administrative, or professional employees for purposes of administering Executive Order 9250 accepted the definitions promulgated by the Wage and Hour Administrator.
I should like to submit appendix A. (Appendix A is as follow :)
Definitions of executive, administrative, and provisional employees promulgated by the Wage and Hour Administrator, pursuant to section 13 (a) (1) of the Fair Labor Standards Act of 1928 (52 Stat. 1060) :
The term "employed in a bona fide executive capacity" shall mean any employee
(a) whose primary duty consists of the management of the establishment in which he is employed or of a customarily recognized department or subdivision thereof, and
(b) who customarily and regularly directs the work of other employees therein, and
(c) who has the authority to hire or fire other employees or whose sug. gestions and recommendations as to the hiring or firing and as to the advancement and promotion or any other change of status of other employees will be given particular weight, and (d) who customarily and regularly exercise discretionary powers, and
(e) who is compensated for his services on a salary basis at not less than $30 per week (exclusive of board, lodging, or other facilities), and
(f) whose hours of work of the same nature as that performed by employees not employed in an executive, administrative, or professional capacity do not exceed 20 percent of the number of hours worked in the workweek by the employees under his direction; provided that this subsection (f) shall not apply in the case of an employee who is in sole charge of an independent establishment or a physically separated branch establishment.
ADMINISTRATIVE The term "employed in a bona fide administrative capacity” shall mean any employee
(a) who is compensated for his services on a salary or fee basis at a rate of not less than $200 per month (exclusive of board, lodging, or other facilities), and
(b) (1) who regularly and directly assists an employee employed in a bona fide executive or administrative capacity (as such terms are defined in these regulations), where such assistance is nonmanual in nature and requires the exercise of discretion and independent judgment; or
(2) who performs under only general supervision, responsible nonmanual office or field work, directly related to management policies or general business operations, along specialized or technical lines requiring special training, experience, or knowledge, and which requires the exercise of discretion and independent judgement; or
(3) whose work involves the execution under only general supervision of special nonmanual assignments and tasks directly related to management policies or general bus ness operations involving the exercise of discretion and independent judgment; or,
(4) who is engaged in transporting goods or passengers for hire and who performs, under only general supervision, responsible outside work of a specialized or technical nature requiring special training, experience, or knowl. edge, and whose duties require the exercise of discretion and independent judgment.
PROFESSIONAL The term "employed in a bona fide professional capacity” shall mean any employee who is
(a) engaged in work
(1) predominantly intellectual and varied in character as opposed to routine mental, manual, mechanical, or physical work; and
(2) requiring the consistent exercise of discretion and judgment in its performance; and
(3) of such a character that the output produced or the result accomplished cannot be standardized in relation to a given period of time; and
(4) whose hours of work of the same nature as that performed by employees not employed in an executive, administrative, or professional capacity do not exceed 20 percent of the hours worked in workweek by such employees; provided that where such nonprofessional work is an essential part of and necessarily incident to work of a professional nature, this subsection (4) shall not apply; and
(5) (a) requiring knowledge of an advanced type in a field or science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study, as distinguished from a general atademic education and from an apprenticeship, and from training in the performance of routine mental, manual, or physical processes; or
(b) predominantly original and creative in character in a recognized field of artistic endeavor as opposed to work which can be produced by a person endowed with general manual or intellectual ability and training, and the results of which depends primarily on the invention, imagi
nation, or talent of the employee; and (b) compensated for his services on a salary or fee basis at a rate of not less than $200 per month (exclusive of board, lodging, or other facilities) ; provided that this subsection (b) shall not apply in the case of an employee who is the holder of a valid license or certificate permitting the practice of law or medicine or any of their branches and who is actually engaged in the
practice thereof. Miss BALMER. These definitions to which the United Office and Professional Workers of America took certain exceptions when they were originally promulgated are therefore the standard definitions of two of the major governmental agencies concerned with matters of policy affecting labor. We may therefore assume that these definitions will serve as guides in the administration of the provision of H. R. 2239 if it should be enacted into law.
However, the legislation which the Committee on Military Affairs is now considering does not limit the proposed restriction to foremen and supervisory employees in industrial establishments. Its language is vague and its scope is broad.
Section IV reads:
shall be responsible for acts of his executive, administrative, professional, or supervisory employees within the scope of their employment,
and such employees shall not be eligible to membership in any labor organization engaging in collective bargaining with any labor organization, including any of such employees in its membership.
Sec. V. Any concerted action, or threats by any persons whatsoever designed to coerce any contractor to deal collectively with a labor organization, including such executive, administrative, professional, or supervisory employees in its membership, shall be unlawful and punishable hereunder.
SEC. VI. The term "contractor" as used herein shall include any person, firm, or corporation producing, processing, or supplying any article or service to the United States Government or to any agency thereof, or to any other person, firm, or corporation engaged in supplying such articles or services to the Government.
In accordance with these provisions, virtually every executive, administrative, professional, or supervisory employee, regardless of the industry or service in which he is employed, would be denied the rights of membership in a labor organization.
For example, an advertising agency which wrote copy for a single war plant would be a service to a corporation engaged in supplying articles or services to the Government, and consequently the employees of such an agency would be affected. This would mean that copyrighters, artists, production employees, et cetera, of advertising agencies would be denied the right of organization. It would mean that publicity men employed by war firms or by firms working for
contractors' would be excluded. It would mean that virtually every salaried chemist, draftsman, engineer, production clerk, expediter, pay-roll clerk, et cetera, in America would be denied the rights of organization.
However, it would be folly to think that the bill which would deny the rights of supervisory, executive, and professional employees in war industries and industries closely related to the war effort would be confined only to such workers. The very loose language of this bill, particularly of sections 4, 5, and 6, would readily lead to extension of law to all administrative, executive, professional, and supervisory employees in all industries.
Moreover, the nature of our wartime economy would make it impossible for the provisions of this bill to operate in so-called direct war industries and related industries without operating in other phases of our eronomy. Not even an act of Congress could deny membership in an organization to the office manager of a war plant and not to the office manager of a firm engaged entirely in civilian services. The original scope of the National War Mediation Board was exercised only in direct war production industries. However, the interrelation of all industries, both as they affect the war effort and as they affected each other, naturally and logically compelled the gradual extension of its function. Its successor, the National War Labor Board, extended its jurisdiction to all employees in all industries.
Certainly the passage of this bill would be an encouragement to all employers to deny the right of organization to all sorts of employees who now enjoy it. A bookkeeper whose work requires exercise of any kind of judgment might readily be excluded under these definitions, and many thousands of other clerical workers whose work in any way departed from the most routine type of clerical operations would find themselves in the same boat. They would find themselves denied access to the provisions of the National Labor Relations Board, to the National War Labor Board, or any other governmental agency which could settle their problems.
Instead of encouraging harmonious relationships between this type of personnel and management, enactment of this bill by Congress would provoke and aggravate all grievances of professional and supervisory workers, discourage increased productivity and efficiency and produce unnecessary industrial strife.
H. R. 2239 also invokes, as a penalty for violation of the proposed legislation, ending of deferments from selective service. The Selective Service Act was never intended to be used as a penalty for violation of the law. Labor has considered service in the armed forces as an honorable and patriotic duty. This threat of drafting anyone or everyone who displeases some Member of Congress frightens no one and tends to minimize the vital and honorable nature of military service.
In addition, H. R. 2239, section 111, subsection 3, would ban any rules, practices, policies, or requirements which are prescribed where there is a reduction in the amount of, or in the time required to perform, any particular work, that compensation be paid as if such reduction had not taken place.
This provision would have the effect of upsetting and destroving existing plans for guaranteed minimum wages. Under a number of collective-bargaining agreements, our organization has succeeded in securing guaranties of minimum daily and weekly work, which would insure to all employees adequate minimum earnings. Where a full workweek cannot be guaranteed it is almost invariably the result of shortcomings in managerial planning so that either work or materials are not available at the proper time. However, the workers are available to perform the work and it is entirely proper that management, under such circumstances, be required to guarantee their wages.
This provision could also readily be utilized to upset the present basis of compensation for salaried employees. It would encourage employers to shift salaried employees to an hourly basis and to engage in lay-offs at every minor reduction of the work load. This would have an unstabilizing and demoralizing effect on a section of the population who have already borne a large share of the burden of the war. The white collar employees who would be affected by this bill have had no comparable wage increases during the period of our war economy to compensate for the rising cost of living.
The New York Herald Tribune commented on this problem in its editorial page on October 2, 1942:
As Senate and House conferees meet in an attempt to adjust the differences in their two drafts of the antiinflation bill and thus give us a law which will authorize and direct the President to stabilize prices, wages, and salaries, one is struck by the bald fact that at no time during the congressional discussion on this subject has the case of the white-collar worker received consideration. For if the matter of personal sacrifice were taken into consideration it would be easily discernible that the burden thus far has fallen with great disparity on the bent shoulders of the politically weak white-collar worker, and that he should receive the solicitude of our representatives long before consideration be given to a floor under farm prices, a method of refiguring parity so that ceilings would be prohibited below 112 percent of present parity prices, or wages in industry be stabilized at their present relatively high level.
The distortions in the wage rates of respective fields of endeavor is illustrated in the current issue of the National City Bank's monthly letter, published today. Based on data of the Bureau of Labor Statistics, it shows that weekly wage earnings of farm labor have increased from the index figure of 100 at the beginning of World War II to 157.1. The index of factory weekly wage earnings is nearly as sensational, totaling 154.4. Now, compare these figures with those recorded for workers in retail trade, or insurance, two fields which typify the whitecollar worker. In retail trade the index has crept up to 109.3 and in insurance it stands now at 106.1 percent of the level prevailing before the outbreak of the war. If there were an index depicting what has happened to the Wall Street worker, the contrast would, without doubt, be even sharper, for in that area the history of the last few years has been one of wage cuts and discharges.
In other words, while the special beneficiaries of the President's antiinflation attempt have been well represented in Congress, the white-collar worker finds himself completely ignored at a time when his slightly higher earnings have failed to keep pace with the rising cost of living. For, while his earnings have increased approximately 6 to 9 percent since the outbreak of the war, the cost of living, also based on data of the Bureau of Labor Statistics, has advanced from an index figure of 100.6 in September 1939 to its current figure of 116.9.
H. R. 2239 is undemocratic and discriminatory in that it would deny to a section of the American people the rights enjoyed by all other Americans. The right of organization for American labor is written into the law of the land. The right of organization for employers is exercised freely and without any legal restrictions. Certainly the important segment of our population which is responsible for administrative and supervisory functions of industry and commerce should likewise enjoy these rights.
The executive, administrative, professional, and supervisory employees have a distinct role to play in the war effort. The kind of supervision they give, the kind of judgment they exercise, the amount of productivity and efficiency that they are capable of achieving, has a large bearing not only upon their own work but upon those whom they supervise, guide, or are responsible for, or whose operations they influence.
Consequently, it is essential for the effective prosecution of the war that these employees have the necessary earnings to assure maintenance of their health and morale and have adequate means of adjusting whatever problems may arise in connection with their work, including the American method of collective bargaining through unions of their own choosing.
Any other course would be a direct blow against the war effort. It would lead not only to increased restiveness among all white-collar workers, who are bearing an unusual share of the burdens due to shifting over to a war economy, but would lead directly to irresponsible interference with war production itself, if for no other reason than that the harshness of this measure tends to induce indifference rather than enthusiaistic support. The problem is a practical one and should be dealt with by practical measures which rely upon the constructive experience of American commerce and industry.
We, therefore, urge that the Military Affairs Committee of the House of Representatives in the interest of increased productivity and the most effective prosecution of the war and in the interest of safeguarding the rights and liberties of all Americans reject the Smith bill as being injurious to national interest.
The CHAIRMAN. Thank you. We will adjourn until 10 o'clock tomorrow morning.
(Whereupon, at 12:25 p. m., the committee adjourned until Thurg. day, April 22, 1943, at 10 a. m.)