ments, in effect since 1963, will be replaced by free collective bargaining in 1968. Under the new system, adopted by the Board of the Labor Foundation (the principal labor-management advisory body to the Government) on October 6, the Government retains the right to intervene only if an agreement presents a danger to the national economy. The Minister of Social Affairs had stated earlier that the Government would accept any wage system approved by the Labor Foundation. Employers realize that free bargaining may cause unrest or strikes, but they prefer it to a Government-controlled wage policy which may require marginal industries to pay higher wages than they can afford. Trade unions recognize the danger of the new system for workers in the weaker industries and enterprises, but feel that free bargaining will stimulate greater member interest.

Denmark-Basic Agreement

The Danish Federation of Labor (LO) has long sought a greater voice for labor in management decisions, and in recent years has had codetermination as a major objective. However, the LO's basic agreement of 1960 with the Employers' Confederation, which replaced the original basic agreement of 1899-the Magna Charta of Danish Laborcontains clauses which prevent worker participation in the hiring and dismissal of employees and in the distribution and direction of work in the enterprise. The LO has, therefore, taken steps to terminate the 1960 agreement. If it is indeed terminated, the agreement will nevertheless remain in force until March 1, 1969, the date of expiration of the national wage contract.

U.S.S.R.-Minimum Wage

Effective January 1, 1968, the minimum monthly wage is to be raised from 40 rubles ($44.44) to 60 rubles ($66.67). The increase will affect workers in the lowest wage brackets of all branches of industry, construction, and agriculture, as well as specific categories of workers in transportation, communications, and consumer services. The average monthly wages of all wage and salary earners in 1966 were 99 rubles ($110), and are expected to be 108.6 rubles ($120.55) in 1968.

1 See Monthly Labor Review, August 1967, pp. 18-19.

Vacations. The minimum annual vacation of a Soviet worker is to be increased, as of January 1, 1968, from 12 working days to 15. In effect, this will raise the minimum from 2 weeks to 3 weeks because of the introduction of the 5-day workweek for most workers beginning November 7, 1967.1 Up to that time, most workers worked 6 days a week and were entitled to at least 2 weeks of annual vacation. It would appear that about a third of all Soviet workers will receive the extra 3 days of annual leave, for in 1964, the last year for which leave figures are available, 36.6 percent of all the workers received 12 days of annual leave.

Japan-Labor Trends

The Ministry of Labor recently issued a roundup of labor developments in 1966 and an estimate of future needs and prospects. The supply of labor in that year continued tight, particularly for smaller enterprises, and new job vacancies increased faster than in 1965.

Average wages and salaries in 1966 were higher by 10.8 percent than in the previous year, mainly because of an increase in overtime work. The differential in the rate of wage increase between large and small enterprises widened in 1966 for the first time since 1958; wages increased by 12 percent in manufacturing enterprises employing more than 500 workers, compared with a rise of 9.5 percent in enterprises with fewer than 100 workers. This widening of the differential resulted from a greater increase in overtime work and in wages for beginners in large firms than in small ones.

Labor productivity rose sharply in 1966, particularly in iron, steel, and machinery manufacturing enterprises, under the influence of business expansion. In machinery manufacturing, the 12.4 percent increase in labor productivity exceeded the 11.6 percent increase in wages. The gap between large and small enterprises in labor productivity was narrowed but remains much wider than that in some other advanced countries.

The Ministry anticipated a reduction in the number of school graduates seeking employment and, consequently, a higher average age of workers in the coming years. It pointed out the need for correcting imbalances in the supply and demand for labor with respect to the following: Shortages of young workers and surpluses of older

workers; shortages in some occupations (particularly skilled ones) and surpluses in others; and the heavy outflow of young men and women from rural areas to urban jobs. The Ministry further advocated modernization of small enterprises and those in services and commerce, to eliminate underemployment and to raise productivity.

Latin America-Income Distribution

According to figures on income distribution published by the United Nations Economic Commission for Latin America, half of the population which receives a lower income than the other half shares in the national income to the extent of a total of 12.5 percent in Ecuador and Peru, 15 percent in Chile and Mexico, 17 percent in Venezuela, 20 percent in Brazil and Colombia, and 20.5 percent in Argentina and Peru. (In the United States and the United Kingdom, the percentages are 23.5 and 25.5, respectively.)

Brazil-Vocational School

The first major urban social project of the Alliance for Progress to approach completion in Brazil, under the sponsorship of a trade union, is a new vocational high school opened in Porto Alegre last August. (The school had provided some instruction in temporary quarters since 1963.) When completed, the school will accommodate 1,500 day students and 700 night students. This project, called by U.S. Ambassador John W. Tuthill "a pioneering step in vocational training in Brazil," began in 1960 when the Porto Alegre Metalworkers' Union agreed to devote a wage increase to the construction of a school for vocational training. In 1966, the U.S. Agency for International Development (AID) signed a Program Agreement with the union, which led to an AID grant of 346,000 new cruzeiros (about $127,000) for that purpose. The school is widely considered to be a model of trade union participation in the Alliance for Progress, and a step in the fulfillment of the Declaration of Cundinamarca, issued by the first meeting of Ministers of Labor of American States in 1963.

Peru-Wages

On September 1, the sol was devalued by 32 percent (from 3.8 to 2.6 U.S. cents). Strong protests

were immediately made by organized labor against the resulting increase in the cost of living. Decree No. 10 of October 13 was then issued, granting a flat wage increase of 10 percent-but not to exceed 1,000 soles per month-to all private sector employees, retroactive to September 1. Trade unions held that this increase was insufficient to compensate for the devaluation and called general strikes in several southern cities, which led to a 30-day suspension of constitutional guarantees in the Province of Arequipa. On October 24, the Government issued Decree No. 11, to provide additional increases for the lowest paid workers.

The new law provides the additional monthly wage increases on a sliding scale. Workers earning up to 1,500 soles per month will receive an increase of 150 soles (minimum 10 percent); those earning between 1,500 and 2,500 soles, an increase of 125 soles (maximum 8.3 percent and minimum 5 percent); and those earning from 2,500 to 4,000 soles, an increase of 100 soles (maximum 4 percent and minimum 2.5 percent). Agricultural workers will receive an increase of 50 soles per month. A bill pending before the Congress provides for an increase of 500 soles per month for married Government employees, and 450 soles per month for single ones.

El Salvador-Workers' Housing

The Institute of Urban Housing (IVU) has undertaken a program, under which private companies and public agencies can join with the IVU and the prospective homeowners in financing lowcost housing for workers. The new program is called the Third Party Program: the IVU and the prospective homeowner are the first two parties, while the "outside investor" (private company or public agency) is the third party. The program guarantees the third party a 6-percent annual interest on its investment.

The prospective homeowner and the employer (third party) are to furnish jointly at least 30 percent of the necessary financing, and the Institute will provide the remainder. However, in cases where municipalities or public entities are the third parties, the share to be provided by the homeowner and the third party may be reduced to 20 percent. The monthly payment made by the homeowner will be applied first to repaying the third party's equity.

Significant Decisions in Labor Cases*

Constitutional Issues

Crew Consist. A three-judge Federal district court ruled that two Arkansas statutes requiring six-man crews for freight trains and switching operations were no longer justifiable for safety reasons and were, therefore, unconstitutional since they now violated the due process guarantee and were unduly burdensome on interstate commerce. The court concluded that if the railroads were to survive, they must be free to take advantage of technological improvements and innovations, and that they should be able to solve the crew consist problems by means of collective bargaining with the unions.

In 1964 the carriers challenged the validity of the State's crew consist laws on constitutional grounds, and on the further basis that the Federal Government had preempted this question when Congress, acting to avert a threatened rail strike, provided for arbitration to settle the crew consist problem. In the initial proceeding the district court granted the carriers summary judgment on the preemption question, but the Supreme Court reversed and remanded the case for consideration of the constitutional issue.3

2

The carriers contended that the crew consist laws were unconstitutional in that they were no longer required for safety reasons due to technological advances in the industry. The defendants and intervening unions, in essence, argued that safety still required crew consist rules. But even if this was debatable, they held, the court should not substitute its judgment for that of the State legislature; and in the alternative, the laws were justifiable as "economic" legislation. The court rejected the alternative basis because the laws always had been exclusively characterized as safety measures.

Summarizing the applicable legal principles, the court stated, "In the absence of controlling Federal enactments, the State . . . is free, subject to the limitation of the Commerce Clause, the Due Process Clause, and the Equal Protection Clause, in the exercise of its police power to legislate in the interest of safety of railroad operations even though its legislation may affect interstate commerce."

Thirty-four years ago, the court pointed out, the Supreme Court upheld these particular crew consist laws as being reasonable safety statutes; but the technological changes which have occurred over the intervening years enabled the railroads to operate with smaller crews without an increase in accidents. The court concluded that "continued enforcement of the statutes makes no significant contribution to railroad safety," and held that it is unreasonable and arbitrary to require six men for all road service and switching operations regardless of circumstances.

The court also recognized that if the railroad industry is going to survive it has to be able to take advantage of technological advances. These statutes "hamstring the carriers in the important field of labor relations, and impose upon them requirements not generally imposed throughout the country and not imposed in any of the (bordering) States. . .," the court concluded. Thus since the laws are no longer needed for safety reasons, the additional payroll costs they cause the carriers to incur place the carriers at a competitive disadvantage with other modes of transportation and, therefore, constitute an undue burden on interstate

commerce.

The court made it clear, however, that by finding the laws unconstitutional, it did not require the

*Prepared in the U.S. Department of Labor, Office of the Solicitor. The cases covered in this article represent a selection of the significant decisions believed to be of special interest. No attempt has been made to reflect all recent judicial and administrative developments in the field of labor law or to indicate the effect of particular decisions in jurisdictions in which contrary results may be reached based upon local statutory provisions, the existence of local precedents, or a different approach by the courts to the issue presented.

1 Chicago Rock Island and Pacific Railroad Co. v. Hardin (D.C.-W.D. Ark., October 2. 1967).

a Chicago, Rock Island and Pacific Railroad Co. v. Hardin, 239 F. Supp. 1 (1965).

3 Brotherhood of Railroad Locomotive Engineers v. Hardin, 382 US 423 (1966).

Missouri Pacific R. Co. v. Norwood, 290 US 600 (1933).

increase or decrease in crew consist. The decision "simply leaves [the carriers] free to work out their crew consist problems with the Brotherhoods by means of collective bargaining with the framework of the Railway Labor Act without their hands being tied by statutes [no longer required for safety reasons]," the court said.

It should be noted that, in holding the crew consist statutes unconstitutional, the court pointedly observes that its decision conflicts with recent decisions by the highest courts of New York and Indiana, thus indicating its opinion that the time is right for the Supreme Court to reexamine the question.

The airline has a policy of hiring only single girls as stewardesses, and requires them to sign a statement that if they marry they will resign. When the airline fired a married stewardess, she brought suit, claiming the company had committed an unlawful employment practice in violation of section 2000e-2(a)(1) of the act, which bans discrimination in employment because of "race, color, religion, or national origin." The plaintiff argued that since the airline did not require male employees to be single, demanding this of stewardesses was discriminatory. The company defended its policy by contending that the "single woman rule" was a bona fide occupational qualification and as such was protected by the act (section 2000e-2(e)).

The court did not reach consideration of the above defense, but held the company had discriminated on the basis of marital status, not sex, and that "it is plain" the act "does not prevent discrimination against married people in favor of single ones." Nor does the act's legislative history indicate that Congress intended to ban such discrimination, the court added.

Labor Relations

Secondary Boycott. The National Labor Relations Board held that a union violated the secondary boycott provisions of the National Labor Relations Act when it picketed businesses, including restaurants, and distributed handbills asking the public not to patronize the places because they advertised in a newspaper published by an employer with which it had a labor dispute. The Board further held that the handbills were misleading, and their distribution was illegal, since they referred to "this establishment"-which could have been any of the shops in the market place-rather than to the businesses concerned.

The union and the publisher of a weekly newspaper were engaged in a labor dispute. Five businesses, four of them restaurants, which regularly advertised in the newspaper, were located in a shopping center that also housed numerous businesses that did not advertise in the weekly. The unions picketed the entrance to the shopping center with signs asking the public not to buy the products of the businesses advertised in the weekly newspaper. It also distributed handbills asking the public not to patronize "this establishment."

The publisher charged the union was conducting an unlawful secondary boycott, attempting to injure the businesses of the newspaper's customers in an effort to force them to stop doing business with the newspaper. The union alleged that its activity was lawful under the doctrine of the Tree Fruits case, where the U.S. Supreme Court held that a union may conduct consumer picketing against a secondary employer to persuade his customers not to buy from him the products of a primary employer.

7

The Board held that since four of the picketed businesses were restaurants, they were actually advertising the businesses themselves rather than their specific products. The union's picketing was, it said, an attempt to stop the public from patronizing the restaurants entirely. The Board found this to be a secondary boycott prohibited by the

act.

Eulalie E. Cooper v. Delta Air Lines, Inc. (D.C.-E.D. La.. October 19, 1967).

• Honolulu Typographical Union No. 37 and Hawaii Press Newspapers, Inc., 167 NLRB No. 150, October 25, 1967.

7 NLRB v. Fruit and Vegetable Packers Local 760, 377 U.S. 58.

It also found that the handbills which the union passed out at the gate to the shopping center were misleading in that they alleged a dispute with "this establishment." The Board held that this was intended to imply that the entire shopping center was involved rather than just the five which advertized in the paper.

8

One member of the Board dissented, arguing that the Tree Fruits case must be read with two other cases which established that an employer providing a medium by which a product is advertised participates in the "production" of that product within the meaning of the act's definition of production. A service, he stated, is a product as much as bread is; since a service is not divisible into its components, the entire business was the product advertised by the restaurants picketed. If the union has a right to picket the primary employer's products at the place where the customer receives them, the picketing of the advertised services at the secondary employer's places of business was not unlawful. The fact that all the products of a restaurant are advertised by the employer involved in a labor dispute does not, in the dissenter's opinion, limit the union's right to picket.

The dissenter also found no violation in the distribution of the handbills. The handbills were designed to be distributed in front of the advertised places of business, but this was prevented by the police. He held that since they were distributed at the shopping center gate in conjunction with picketing which identified the businesses involved, there was no ambiguity about their meaning and intent.

Vague Court Order. In a recent holding, the Supreme Court found a district court's decree enforcing an arbitration award in a labor dispute "too vague" to have apprised the defendant union in specific terms of what it prohibited or required. Enforcement of the decree was, therefore, denied.

• Great Western Broadcasting Co. v. NLRB, 356 F. 2d 434, and NLRB v. Servette, Inc., 377 U.S. 46.

• International Longshoremen's Association, Local 1291 v. Philadelphia Marine Trade Association (U.S. Sp. Ct., Nov. 6, 1967).

10 Sinclair Refining Co. v. Atkinson, 370 U.S. 195.

11 Textile Workers Union v. Lincoln Mills, 353 U.S. 448.

The Court did not decide whether the NorrisLaGuardia Act's anti-injunction provisions forbid the Federal courts to issue such decrees.

A union and an employer association submitted a dispute to an arbitrator in accordance with their collective bargaining agreement, but when the arbitrator upheld the association's position, the union refused to abide by the award. After a series of work stoppages over the previously arbitrated issue, the association sought, and was granted, an order from a Federal district court directing the union "to comply and abide by said award." When another work stoppage occurred over the same issue, the union was cited for contempt and fined $100,000 a day for as long as the work stoppage continued. A court of appeals affirmed the contempt citation, and the union appealed to the Supreme Court.

The union asserted that the order was too vague, and that the Federal district court was prohibited from issuing the decree by the Norris-LaGuardia Act. It cited a case 10 in which the Supreme Court ruled that a Federal court cannot enjoin a work stoppage even when the applicable contract contains a no-strike clause. The association argued that the decree was not an injunction within the meaning of the Norris-LaGuardia Act, and cited a Supreme Court holding 11 that a Federal court may grant equitable relief under section 301 of the LMRA to enforce an agreement to arbitrate.

Without deciding whether the decree was an injunction under the Norris-LaGuardia Act, the Court held that it was an injunction within the meaning of Rule 65 (d) of the Federal Rule Of Civil Procedure, which requires that a court's order be in "specific . . . terms." "For whatever power the district court might have possessed under the circumstances disclosed by this record," the Court said, "the conclusion is inescapable that the decree which the court in fact entered was too vague to be sustained as a valid exercise of Federal judicial authority."

Regarding the power of a contempt citation, the High Court observed: "The judicial contempt power is a potent weapon. When it is founded upon a decree too vague to be understood, it can be a deadly one. . . . The most fundamental postu

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