I should perhaps explain how the work is being done in the field. In order to save traveling expenses, instead of sending out somebody from Washington all of the time to these rather remote places where predetermination is necessary, we assign some attorney who is in private practice in that town to that task. We send him copies of the regulations, and we ask him to hold a hearing, notifying the Master Builders Association and the Associated General Contractors, as well as the labor unions in that vicinity, to come to the hearing and present evidence as to what they believe to be the prevailing wage. Mr. MCMILLAN. What I want is this: Here is an increase requested of $70,400, and I want a table showing for the record how that increase is arrived at. Include in it a description, briefly, of the character of work, what you pay the attorneys, and so forth. (The statement referred to is as follows:) MEMORANDUM ON ADMINISTRATIVE EXPENSES OF BACON-DAVIS ACT, as AMENDED An explanation of the items included in the 1937 Budget estimates to cover the administration of the amendments to the Bacon-Davis Act are as follows: Salaries and expenses (Commissioners of Conciliation): Traveling ex penses Grand total... $4,600 1, 800 15, 600 47, 060 69, 060 500 500 600 1, 500 1,500 5, 340 3, 000 1,000 1 13,940 83,000 11, 000 94, 000 1 As shown by the break-down of contingent expenses the actual increase requested is $5,800. It is therefore shown that the needs for this service are very much in excess of the amount which has been requested. OPERATION OF THE STATUTE The amendments to the statute, known as the Bacon-Davis Act, which went into effect on September 30, 1935, require the Secretary of Labor to establish for every contract relating to the construction, alteration or repair of public buildings and public works of the United States or the District of Columbia, the minimum wages to be paid to the various classes of laborers and mechanics employed. (Act of Aug. 30, 1935, Public, No. 403, 74th Cong.) This statute was designed to implement the prevailing rate of wage principle already recognized as the policy of the Federal Government by the original Bacon-Davis Act (act of Mar. 3, 1931, 46 Stat. 1494, U. S. C., title 40, sec. 276[a]), which was directed toward the maintenance of local wage levels and the wide-spread abuse known as the kick-back. Because of a ruling by the Comptroller General of the United States denying retroactive effect to the determinations of the Secre tary of Labor under the act, and because of the impossibility of protecting contractors from unanticipated changes in the large labor items of their contracts, this first prevailing wage law proved less effective than had been hoped. In answer to general demand from both employers and employees, amendments were provided which substantially broaden the scope of the regulation of Federal construction contracts. The new statute extends the prevailing rate principle to contracts for public works as well as for public buildings, to contracts for painting and decorating as well as for construction, alteration or repair and to contracts in excess of $2,000 as against the $5,000 limit in the earlier law. The most far-reaching administrative change was the introduction of a stipulation that the minimum standards fixed by the Secretary of Labor be based upon a predetermination by the Secretary of Labor of the prevailing wages for the corresponding classes of laborers and mechanics employed on projects of a character similar to the contract work in the city, town, or other civil subdivision of the State in which the contract work is to be performed. An important and complex administrative task was thus added to the duties of the Department of Labor. Its magnitude is graphically illustrated by the fact that while in the last year of its operation only 21 cases arose under the original Bacon-Davis Act, an average of 169 cases per month has been the experience in the first 5 months under the amended statute. The procedure involved in the operation of the amended Bacon-Davis Act is simple. Request for predetermination of the prevailing rates of wages in a particular locality is made by the contracting agency of the Federal Government which is contemplating a project of the character governed by the act. Regulations promulgated by the Secretary of Labor having established the public hearing as the basic fact-finding technique, a preliminary finding as to the necessity for such field investigtation is made. If this is determined to be necessary an attorney in the State where the project is to be located is invited to conduct the investigation and to prepare a report for the Solicitor of Labor. Upon the receipt of the referee's report or in the event that adequate information is already available to the Department, a draft decision is prepared together with a memorandum addressed to the Solicitor summarizing and analyzing the evidence upon which the tentative findings have been made. Final review by the Secretary of Labor follows the approval of the draft by the Solicitor. VOLUME OF WORK In the first month after the amended act became effective, 74 requests for predetermination were received by the Department. The number increased in November to 114, fell slightly in December to 106, jumped sharply in January to 448, and returned to what may be taken as a rough norm in February at 102. With the gradual training received from experience, the staff was able to keep pace with the work in the early months, 55 decisions being rendered in November and 99 in December. The unprecedented volume of cases in January has made it impossible in spite of a doubling of the staff to keep abreast of requests, and the relative pace of determinations has declined as a result. Actually, however, figures indicate that the productive capacity of the staff has been high throughout and that full advantage is being taken of the increased personnel which has been found necessary. A tabulation of these figures follows: Of the 844 cases received thus far, 230 have been referred to field representatives. This ratio, which is substantially lower than that in the early months of the act, means that about 26 percent of the requests are so treated and that about 74 percent are disposed of in the office. These figures are subject to change as the facility of administration within the Department improves and as the information obtained covers a wider and wider territory. Using the figures now available it may be estimated that by the end of the current fiscal year, June 30, 1936, 1,516 cases will have been received from October 1, 1935; of this number, if the ratio remains approximately constant, 394 cases will be referred for field investigation. On a 12-month basis, it may be expected that the total number of requests will approximate 2,022, of which 524 will require investigation at the site. ADMINISTRATIVE EXPENSES Pursuant to provisions contained in the amended act the administrative expenses of carrying out its provisions have been financed for the current fiscal year by an allotment of $100,000 from the Works Progress Administration. The work has been handled by a small staff of attorneys and clerical employees in the Solicitor's office, which disposes of three-fourths of the cases without reference to the field and acts as a review division on reports from the field. The size of this force has varied from time to time but it is believed that the present number approximates requirements. For a staff consisting of a senior attorney, 3 assistant attorneys, 5 junior attorneys, 12 stenographers and clerks, and 1 messenger, a total annual pay roll for services in the District of Columbia of slightly more than $52,000 a year would be necessary. The field representatives are referees appointed at $20 per diem for the period in which they are actually conducting hearings and making their investigation. Thus far 230 cases have been referred to referees, the majority of whom have had only one assignment. There are about 200 referees on the panel from which the Solicitor draws. An assignment ordinarily entails about 31⁄2 days' work which means a fee per case of about $70, according to the average of the salary claims thus far received. During the 5month period from October 1, 1935, to February 29, 1936, $25,891 has been spent for field investigations. These figures are necessarily based on a relatively small number of claims received in connection with field investigations. Of 230 appointments for special refereeships, salary claims have been received from only 67 and travel vouchers from 64. Bills for stenographic services have been received from 65 and bills for advertising notices of hearings in newspapers from 100. Thus the available figures indicate an average cost per field inquiry of $112.57. This would mean that for the 12-month period next year about $120,000 would be necessary for the operation of the act. There is attached a tabulation of available figures together with the revised estimates based thereon and a comparison of the break-down with the estimates as approved by the Bureau of the Budget. It is evident from a comparison of the budget estimates for salaries with the anticipated requirements of administration that a high degree of flexibility is desirable in the bill to allow for adjustments between home and field staff. The use of temporary local representatives, which was determined upon for economy in travel expenses, relieves the office staff of much of the work of investigation but substitutes therefor the delicate and concentrated study required in the review of referees' reports and the data available through other agencies of the Federal Government. This necessitates the services of competent attorneys qualified for the sifting and the valuation of complex masses of information. Although methods of administration have been developed which are believed to be workable and effective, the novelty of the problems the new act raises requires that opportunity be allowed for the adaptation of the existing organization to accumulated experience. The volume of detail involved in the administration of the new statute, adding a heavy burden to the wide responsibilities of the Solicitor of Labor, has pointed from the start to the necessity of the creation of an intermediate reviewing position. This office, which would be filled by a senior attorney, would coordinate the work of home and field staffs and would characteristically function as a preliminary reviewing authority. By thus protecting the Solicitor from a welter of more or less routine detail, the establishment of such a post would increase in a high degree the accuracy and speed with which the Department can act. Mr. BACON. What do you pay these outside attorneys that you have referred to? Mr. REILLY. We pay $20 a day to a reputable lawyer to hold these hearings. Mr. MCMILLAN. The other items here requested, for temporary help, District of Columbia, $15,600 Mr. SAUNDERS. That is the same thing. Mr. MCMILLAN. And for temporary employees for the field, $47,060 is asked. Is that part of the Solicitor's office? Mr. SAUNDERS. Yes. I must ask you this, if you can do it for us: We would like very much to change those figures around a little bit, and put more in the District of Columbia than in the field. We have six young attorneys at around $2,000 each who are digesting all of the data that comes from the field, and they are not provided for in the allotment for the District of Columbia. Mr. BACON. Do you mean the results of these hearings? Mr. SAUNDERS. Yes, and they are going to be more or less permanent in Washington, and unless we can get more money, we are going to be embarrassed terrifically. Mr. MCMILLAN. The language of the bill, Mr. Saunders, does not carry any limitation. it. Mr. SAUNDERS. It does not? Mr. BACON. No. It is only in the break-down. Mr. SAUNDERS. Well, fine. Mr. BACON. There is nothing in the bill that I can see that prevents Mr. SAUNDERS. Fine. Mr. BACON. It is just in the break-down that you gave us. Mr. SAUNDERS. All right. EMPLOYMENT OF PUBLICITY EXPERTS Mr. BACON. My attention has been called to section 54, United States Code (Oct. 22, 1913, 38 Stat. 212) which reads as follows: No money appropriated by any act shall be used for the compensation of any publicity expert unless specifically appropriated for that purpose. Are there any employees of the Labor Department used for publicity purposes within the meaning of this statute? Mr. SAUNDERS. No, sir. ADMINISTRATIVE PROMOTIONS Mr. MCMILLAN. Now, Mr. Saunders, will you submit for the record a list showing your automatic promotions in the Department, administrative promotions? Mr. SAUNDERS. Yes, sir. You mean, I take it, in this fiscal year 1936? Mr. MCMILLAN. That is right. I think that that is about all for this item, unless you have something further to add. (The list of administrative promotions referred to is as follows:) Statement showing administrative promotions made since June 30, 1935, under authority of sec. 24, Independent Offices Act, 1935 |