WAGE STABILIZATION PROGRAM

FRIDAY, JUNE 8, 1951

UNITED STATES SENATE,

SUBCOMMITTEE ON LABOR AND LABOR-MANAGEMENT RELATIONS OF THE COMMITTEE ON LABOR AND PUBLIC WELFARE,

Washington, D. C. The subcommittee met, pursuant to call, at 10:45 a. m. in the Old Supreme Court Room, the Capitol, Hon. Paul H. Douglas, presiding. Present: Senators Douglas and Taft.

Also present: Ray R. Murdock, counsel; Mrs. Eve Finnegan, clerk, Labor and Labor-Management Subcommittee; Jack Barbash, economist; and Thomas S. Shroyer, professional staff member, Committee on Labor and Public Welfare.

Senator DOUGLAS. First may I apologize to the group for being 15 minutes late. I was on my way over here when an executive session of the Banking and Currency Committee was called which required that I attend in order to make a quorum. I have just been able to free myself from that. I regret the delay and inconvenience I have caused you.

Mr. MOSHER. That is quite all right, Senator.

Senator DOUGLAS. Will you identify yourself for the record and proceed with your testimony?

STATEMENT OF IRA MOSHER, PRESIDENT, NATIONAL ASSOCIATION OF MANUFACTURERS; ACCOMPANIED BY LAMBERT MILLER, GENERAL COUNSEL; AND LEO TEPLOW, ASSOCIATE DIRECTOR, INDUSTRIAL RELATIONS DIVISION, NATIONAL ASSOCIATION OF MANUFACTURERS

Mr. MOSHER. My name is Ira Mosher. I am president of Ira Mosher Associates, New York City. I am appearing as chairman of the mobilization committee on behalf of the National Association of Manufacturers, an organization composed of more than 16,000 members.

First I would like to say that we appreciate this opportunity to present to your committee the views of the association on this general question of settlement of labor disputes.

Before starting, I think I would like to straighten out the record a little, if I may. It appears that Senator Humphrey-and I am very sorry he isn't here today

Senator DOUGLAS. Senator Humphrey is sorry, too, but he previously had been called to Minnesota.

Mr. MOSHER. I am sorry I can't say this to him personally. Through a misunderstanding we originally were asked on Wednesday or Thurs

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day to appear before the committee on Tuesday. We gathered the impression, apparently erroneously, that the hearings were only to last for 1 day. I was not reachable at that time and we submitted a brief statement in writing.

Senator DOUGLAS. This pamphlet, Settlement of Wage Disputes. Mr. MOSHER. We submitted the brief statement plus the white paper.. At that date Senator Humphrey put into the record quite a long statement indicating his belief that possibly NAM was not interested. I simply want to point out that through that misunderstanding there was not a refusal on our part to appear and when we had Senator Humphrey's letter we arranged a date and we are very glad to be

here.

Senator DOUGLAS. Mr. Mosher, I am one of those who does not believe that it pays to keep books, so to speak, in public life. The past. is erased and we can proceed now.

Mr. MOSHER. Apparently there are quite a few people in the country who don't keep them in private life.

With your approval, it is not my intention to read this brief which you notice is rather lengthy. I would like to pick up and emphasize certain parts of it, if I may. Starting on page 1:

We think this is one of the most critical and important problems now pending before the Congress. Whatever decision is reached by Congress in resolving this problem will be of major consequence in determining the future course of labor-management relations in this country for some time to come. Your decision will determine whether or not our present national policy of reliance on collective bargaining for settlement of labor disputes is to be superseded by some form of governmental intervention or compulsory arbitration.

The National Association of Manufacturers opposed conferring disputes authority on the Wage Stabilization Board. It is also opposed to the continuance of such disputes authority in that Board and to the creation at this time of any special agency having jurisdiction over disputes between employers and employees.

This position was adopted by our Board in February of this year and has been affirmed and reaffirmed through our rather extensive committee consideration. It reflects the experience with the War Labor Board in World War II, and other boards. They demonstrated conclusively in our opinion that genuine free collective bargaining cannot function and just will not function as long as there is a governmental agency available to fix the terms and conditions of employment.

Despite our wartime experience with the labor disputes agency and the congressionally defined national policy of reliance upon negotiation and collective bargaining to resolve disputes, the President on April 21 again created an agency to intervene between employers and employees in framing their collective bargains. This action was taken over the unanimous objections of industry and notwithstanding the general belief that the present emergency may last for many years. We have serious doubt that collective bargaining, and therefore the national policy based on collective bargaining, can survive any protracted period of Government intervention in the affairs of employers and employees.

By recreating the Wage Stabilization Board and granting it certain authority in the field of labor disputes, the President acted on the basis

of his so-called general powers and in contravention of the clearly expressed intention of Congress in enacting title V of the law now being reviewed by this committee. This was admitted by the general counsel of the Office of Defense Mobilization when on May 8 he told the House Committee on Banking and Currency that the present Wage Stabilization Board was "not created under title V of the act." It may be argued, of course, that the present agency is not the equivalent of the War Labor Board since it only has the authority to recommend. You should not be misled by such arguments, however, for, as you all know, there are many ways for "recommendations" of the Government to be made commands. You will all recall that decisions of the old War Labor Board were considered to be recommendations only. Yet severe sanctions, both direct and indirect, were brought to bear on any employer who chose not to follow the recommendations again by that agency. If you want to know the path the new board will inevitably follow, consider these words uttered on April 30 by the United Labor Policy Committee, the group which was appeased by the Executive order of April 21, and I quote:

The United Labor Policy Committee accepts the reconstitution of the Wage Stabilization Board, with 18 members and with new powers to handle all disputes which substantially affect defense production.

There were four basic reasons which prompted the NAM board of directors to reach the position which I have just stated.

First, it was our sincere belief that there was no present need for any extraordinary agency such as the old War Labor Board.

Second, establishment of a special labor-disputes agency would be destructive of the national policy of relying upon voluntary negotiation and collective bargaining for settlement of disputes.

Third, the creation of such an agency would encourage rather than discourage labor disputes and work stoppages and thus impede the mobilization effort.

Fourth, it is our belief that existing provisions of law are adequate to deal with any labor disputes which threaten the defense effort. With your permission, Senator Douglas, I am just going to emphasize a few paragraphs in the remaining part of the brief, unless you want me to go through it all.

Senator DOUGLAS. Proceed as you wish.

Mr. MOSHER. As to the first reason, that no need exists for a special disputes agency, I would like to quote from Dr. Taylor and I am referring to the top of page 4. Dr. Taylor said this:

This flood of cases indicates that the problems which were created by the issuance of the freeze have by no means been fully answered. They are not disputes. They are all requests for increases which employers and employees have agreed are essential to their own activity.

That is Dr. Taylor's own statement, and I think it is sufficient to almost prove the point.

Turning to page 5 of the brief, the second point, the creation of a special disputes agency, that the creation would destroy collective bargaining, I would like to emphasize these points: Both the Labor-Management Relations Act and its predecessor, the Wagner Act, reading from the bottom of page 5, state the basic Federal policy to be the encouragement of the practice and procedure of good-faith collective bargaining as a means of mitigating and eliminating labor disputes.

In the Defense Production Act, Congress reaffirmed this policy stating that the "national policy shall be to place primary reliance upon the parties to any labor disputes to make every effort through negotiation and collective bargaining," to effect settlement in the national interest.

I should like to emphasize that good faith negotiation and collective bargaining cannot survive when there exists a Government agency created for the purpose of deciding all types of disputes arising between employers and employees in the normal course of collective bargaining. In such circumstances, the record of the War Labor Board demonstrates that bargaining is replaced by a series of mechanical procedural steps to be taken in order to get a case to the agency for determination. The result, of course, is not only an end to collective bargaining, but also the imposition of some form of compulsory arbitration.

Here is what the War Labor Board itself said in August 1943, and I quote in part:

There is an unfortunate tendency on the part of some unions and employers to agree on nothing and to end up every negotiation by saying "Let the War Labor Board decide it, we won't agree on anything." Collective bargaining cannot be bypassed without untoward results.

That is the War Labor Board speaking:

Here is what the War Labor Board's Shipbuilding Commission said in January of 1944, and again I quote:

It is fairly obvious that both parties have shaped their case all along in an effort to secure the most favorable action from the Commission. The union has used a shotgun loaded with fine birdshot hoping that at least a few of the pellets would ring the bell. The company appears to be under the impression that the Commission would grant the union something anyway and that it would weaken its "bargaining position" if it voluntarily acceded to any of the demands. That I suggest is a typical case of the Shipbuilding Commisison of the War Labor Board speaking.

Turning to the next page, page 7, middle paragraph:

It is almost universally agreed that we have entered upon an emergency period the end of which cannot be foreseen. Our national traditions are based upon voluntarism and not upon compulsory dictation. Our national labor policy likewise is premised upon goodfaith negotiation and collective bargaining.

This tradition and policy should not be lightly abandoned, and never without a prior and conclusive demonstration of pressing need for governmental intervention of the type which experience has shown us would be inevitable once a labor-disputes agency is established or permitted to function. Accordingly, we strongly urge that voluntarism and good-faith negotiation be given a chance to demonstrate their worth before adopting compulsive methods.

We recognize, of course, that the Wage Stabilization Board is expected to handle only disputes which are (1) those submitted to the Board by both parties for recommendations or final arbitration and (2) those certified to it by the President without consent of the parties. We submit that, in practical effect, each of those is a form of compulsory arbitration.

If an employer objects to submitting a dispute to the Wage Stabilization Board for a binding decision, the union can exert pressure by way of a strike in an attempt to force him to accept so-called