I think that either one of these bills supplement the action Congress may take under the appropriation bill.

Senator ELLENDER. The present method, as I understand it, is handled under an Executive order, isn't it?

Mr. ALTMEYER. The operation of the United States Employment Service, yes.

Senator ELLENDER. Does this S. 1510 or S. 1456 come within the purview of that Executive order?

Mr. ALTMEYER. The Executive order provides for the Federal operation. This provides for State operation.

Senator ELLENDER. You stated a moment ago that we ought to adopt what was now being done?

Mr. ALTMEYER. What I mean is this: If H. R. 4407, the rescission bill, is passed, it provides that the employment services go back to the States within 120 days.

Then it seems to me, in order to put that action on a permanent statutory basis, you ought to have this sort of legislation for the future.

Senator TUNNELL. And not rely entirely on the appropriation bills each year?

Mr. ALTMEYER. That is right.

This is not in conflict. It is supplemental to and places on a permanent basis the decision that Congress makes under the appropriation bill.

Senator ELLENDER. Mr. Altmeyer, what we are trying to do now is so closely connected with social security, why is it necessary to create different commissions in a State? Couldn't it all be handled through one?

Mr. ALTMEYER. You mean, could it all be handled by a Federal agency?

Senator ELLENDER. The same agency that you now have established in the States to handle your social security.

Mr. ALTMEYER. You have in all the States two agencies now.

Senator ELLENDER. And now you are going to create a third one. Mr. ALTMEYER. Oh, no. I should point this out: In all the States you have a single agency, just as you have in Louisiana, to administer both the Employment Service and the Unemployment Compensation Acts.

This would not disturb that at all. I think that is desirable, because there must be a single agency at the State level and to administer both, because when you get to the State and local levels, the operations are very closely related.

Senator ELLENDER. When you said "administer both"

Mr. ALTMEYER. Both the unemployment compensation and the unemployment service.

Senator ELLENDER. All right.

Mr. ALTMEYER. However, in Louisiana, I think you have them in the State Labor Department which has other functions.

In about 33 States, however, they are separate from the State labor department.

Senator ELLENDER. In those 33 States, is it all handled under that one agency?

Mr. ALTMEYER. Here is what you have: So far as the Social Security Act is concerned, in practically every State there is what they

call the State welfare department which handles public assistanceand other welfare titles of the Social Security Act.

Then you have another agency, usually known as unemployment commission or employment security commission. That other agency is usually outside the State labor department.

Senator ELLENDER. But as to the States that have no labor department, you would be creating within them a commission, wouldn't you, to handle

Mr. ALTMEYER. No, sir. This would leave intact the unified administration of unemployment compensation and employment service in the States.

Senator ELLENDER. And without the necessity for creating any different commission within the States?

Mr. ALTMEYER. That is right.

Senator ELLENDER. And that applies to all the States whether they have a labor department or not?

Mr. ALTMEYER. That is right. That would be bad.

Senator TUNNELL. S. 1510 provides it will not go into effect until June 30, 1947.

Mr. ALTMEYER. That date should be adjusted in accordance with whatever action is taken under H. R. 4407.

Senator TUNNELL. There isn't any time in S. 1456?

Mr. ALTMEYER. That is right.

Senator TUNNELL. Thank you very much, Mr. Altmeyer. We are glad to have had you here today.

There being nothing further to come before the committee, we will adjourn.

(The subcommittee adjourned at 10: 50 a. m.)
(The following was submitted for the record :)

Mr. CHARLES E. MURRAY,

Clerk, Senate Committee on Education and Labor,

Senate Office Building, Washington, D. C.

NOVEMBER 27, 1945.

DEAR MR. MURRAY: Section 302 of S. 1510, a bill "to provide for the return of public employment offices to State operation, to amend the act of Congress approved June 6, 1933 (48 Stat. 113), and for other purposes," through what appears to be a typographical error, omits the following proviso clause which should be inserted on line 23, after 1941:

"Provided, That any employee transferred to the State service as hereinbefore indicated may, if he so elects, be paid a refund of total deductions and deposits with interest to the date of such transfer."

This omission is obviously an error in view of the fact that the succeeding proviso clause which begins "Provided further," refers to the omitted proviso clause quoted above.

Your attention is invited to this omission for whatever action you may deem appropriate.

Yours very truly,

BERNICE LOTWIN, Chief, Legal Service.

OFFICE OF WAR MOBILIZATION AND RECONVERSION,

Hon. JAMES M. TUNNELL,

Chairman, Subcommittee on Labor,

OFFICE OF THE DIRECTOR, Washington, D. C., December 3, 1945

Senate Committee on Education and Labor, Washington, D. C. DEAR SENATOR TUNNELL: I regret that the pressure of other official duties made it impossible for me to appear personally before your subcommittee and testify on the proposed bills providing for the return of our public employment

office system to operation by the individual States and Territories. I would like, however, to submit this statement for consideration by the subcommittee in its deliberations on S. 1389, S. 1456, and S. 1510.

As you know, the Director of War Mobilization and Reconversion has the responsibility for formulating plans which are necessary to "meet the problems arising out of the transition from war to peace" and for recommending to Congress appropriate legislation to carry out these plans. I believe it is self-evident that one of the most important of the problems to be handled during the reconversion period is the transfer of millions of workers from war jobs in private industries or from the armed forces to jobs in peacetime business.

This transfer will involve human readjustments on a scale which is unprecedented in our Nation's history. Thus far we have had to deal with only a part of the total transfer of men and women in war plants and in the armed services which will be required by the transition to a peacetime economy. We have just begun the enormous task of reemploying and retraining our returning veterans. An effectual national network of public employment offices is the principal resource of the Government in easing the shock of these readjustments on the individuals involved and in minimizing unemployment.

By the end of next summer millions of men and women from the armed forces and from war plants must find new employment-including those who are now unemployed, those who have been and will be displaced by returning veterans, and those who are still to be released by shrinking war industries and governmental agencies and by discharge from the services. The veterans and displaced war workers must have adequate guidance in finding new jobs which make use of the skills acquired in wartime. Several million men and women who have migrated to new communities during the war period must be redirected to areas where they can most readily find employment. I need not point out to you that there will be more individuals needing specialized assistance because of disability than ever before. Nor do I need to emphasize that for our veterans an integrated, well-administered program for occupational guidance, training, and placement is a responsibility which we must not shirk. During the reconversion period I believe that labor-market information provided by the Employment Service will be a primary governmental aid to employers, workers, and the general public. The exchange of knowledge concerning job opportunities and the availability of labor supply will help to cushion the shocks of reconversion and will perform the necessary function of bringing workers and jobs together.

Until the postwar adjustments in the labor market have been completed, I believe that the existing system of 1,500 local employment offices operating under uniform procedures and policies is the most effective method of operation of the United States Employment Service.

As you know, the State employment service which existed when the system was federalized in 1942 had been developed primarily as a result of Federal legislation, the Wagner-Peyser Act of 1933. This act established a FederalState cooperative program under which public employment offices were administered by the States but financed by Federal grants-in-aid, matching State funds on a dollar-for-dollar basis. The beginning of benefit payments under State unemployment compensation laws required a great expansion in employment office facilities. The additional cost of operation was covered by Federal funds granted by the Social Security Board under title III of the Social Security Act. As a result, Federal grants, under the Wagner-Peyser Act or under title III of the Social Security Act, represented more than 90 percent of the cost of operating the State systems. Experience to date with this system makes it clear, I think, that certain modifications should be made in its operation. I am confident that we can find ways of improving the type of Federal-State relationship and at the same time determine a simplified system of financing. In commenting on the legislation which you are now considering I have only one basic question in mind: What legislation is necessary to assure that the employment service does the job in the most effective manner? Our responsibility is to make sure that the employment service is organized and administered in such a way that it best serves the needs of the millions of workers and veterans involved. The President in his letter to Senator Murray of October 29, 1945, stated, "It is imperative that in connection with the transfer of our public employment office system to State operation, the Congress enact legislation which will assure (1) that the States are able to resume such operations on the designated date, (2) that the essential services provided by our local employment offices will not be disrupted during their transition from Federal to State opera

tion, and (3) that the States' operation of such offices under our Federal-State cooperative program will assure the maintenance of the types of facilities and services required under an adequate Nation-wide system of public employment offices."

As Director of War Mobilization and Reconversion, feel it my duty to advise your committee that I believe the following principles to be of basic importance in framing legislation providing for the future operation of the United States Employment Service:

(1) Our employment office system should be financed entirely from Federal funds, and the funds should be furnished in a single grant, instead of the present combination of grants under the Wagner-Peyser Act and under title III of the Social Security Act. These grants should, of course, be administered by the Department of Labor as the Federal agency responsible for the employment service.

* * *

(2) It is self-evident that our public employment service system should operate in the national interest and be fully effective in meeting the national responsibility to civilian workers and to veterans. This is especially important in view of the provisions of section 600 of the Servicemen's Readjustment Act of 1944, which declares the intent of Congress that "There shall be an effective job counseling and employment placement service for veterans and policies shall be promulgated and administered so as to provide for them the maximum of job opportunity in the field of gainful employment." This responsibility, as well as the Nation's obligation to all workers who are unemployed as a result of reconversion, can be fulfilled only if the Federal Government has adequate authority to prescribe standards of efficiency, methods of operation, and basic policies which will apply in all States.

(3) There should be definite authority for the Federal Government to assure that basic standards are met and that adequate facilities and services are provided in any State which is unable or unwilling to maintain an adequate system of State employment offices. Under the Wagner-Peyser Act, the only recourse in such circumstances was to withhold Federal grants-a measure which would be self-defeating because it would eliminate rather than strengthen the deficient State system. Direct authority for the Federal Government to provide public employment services where the State system is inadequate is therefore indispensable.

(4) Federal legislation transferring the Employment Service from Federal to State operation must also deal appropriately with the numerous and knotty problems involved in the transfer of personnel, records, premises and other facilities of the United States Employment Service. These transfers must be accomplished without interruption in service, without confusion, and without injustice to the thousands of employees involved.

If we are to have a sound basis for Federal-State cooperation in the postwar operation of a Nation-wide employment service system, these basic principles are vitally important. I am sure that our committee will make suitable provision for these matters, and that its decision as to the date for effectuating the transfer will recognize the possible effect of premature action on the welfare of millions of veterans, wage earners, and employers.

Sincerely yours,

JOHN W. SNYDER, Director.

DECEMBER 10, 1945.

Hon. JAMES E. MURRAY,

Chairman, Committee on Education and Labor,

United States Senate.

DEAR SENATOR MURRAY: This is in reply to your request of October 30, 1945, for a report on S. 1510, a bill to provide for the return of public employment offices to State operation, to amend the act of Congress approved June 6, 1933 (48 Stat. 113), and for other purposes.

During 1943, 1944, and 1945, the responsibility for providing an adequate supply and distribution of farm labor was assigned to the War Food Administration and the Department of Agriculture through Public Laws 45, 229, and 529, respectively of the Seventy-eighth Congress, these acts being known as the Farm Supply Appropriation Acts.

A large portion of the shift from wartime to peacetime food production will take place in 1946, and we have recommended that the responsibilities for furnishing an adequate supply of farm labor remain unchanged during the transition period. This recommendation was transmitted by the President to the Congress on October 20. Provision for continuation of the farm-labor program has been included in H. R. 4805, the deficiency appropriation bill now pending in Congress.

Since S. 1510 provides for the return of public-employment offices to State operation on June 30, 1947, any provisions of this bill, or of the original act approved June 6, 1933 (48 Stat. 113), relative to farm labor would not conflict with the recommendations we have made for the conduct of the farm-labor program in 1946. I, therefore, have no comments or suggestions relative to S. 1510. The Bureau of the Budget advises that it has no objection to the submission of this report.

Sincerely yours,

CLINTON P. ANDERSON, Secretary.

TWELFTH ANNUAL CONFERENCE ON LABOR LEGISLATION (1945): REPORT OF THE COMMITTEE ON UNEMPLOYMENT COMPENSATION AND THE EMPLOYMENT SERVICE, AS ADOPTED

1. Findings

I. STATE UNEMPLOYMENT COMPENSATION SYSTEMS

A. Disqualification provisions

(a) Provisions in State unemployment compensation laws regarding “suitable employment" regulations and interpretations made thereunder vary widely among the several States.

(b) There is tremendous variation in the experience of State unemployment compensation operation in the disqualification of applicants for unemployment compensation benefits.

(c) Disqualification in many instances takes no cognizance of occupational experience and earning power of applicants.

(d) Disqualifications are resulting in undue hardship to claimants by depriving them of the only source of income available to them during periods of unemployment.

2. Recommendations

(a) That this conference call upon the various State unemployment compensation agencies to interpret and administer their laws in a liberal manner calculated to provide the maximum protection both to individual claimants who are involuntarily unemployed and to our national economy and in the determination of eligibility in each claimant's case to exercise all care to assist him in maintaining his dignity, independence, and self-respect.

(b) We furthermore call upon the agencies in interpreting "suitable work" totake into account the various factors recommended by the Social Security Board such as the claimant's prior earnings, training, and experience, the length of his unemployment, and his prospects for obtaining work in his customary occupation, and the distance of the available work from his residence.

(c) We also recommend that no claimant shall be denied benefits because he refuses to take a job which is not comparable to his proven skill, ability, and earning capacity.

(d) It is further recommended that all States whose laws do not now so provide amend their laws to provide (1) a definition of suitable work in accordance with the recommendations of the Social Security Board model bill; (2) that I claimants not be disqualified for benefits as a result of voluntary separation from employment for good cause nor suffer complete disqualification for more than 1 to 4 weeks for voluntary separation for any cause; (3) that clauses limiting good cause to "cause attributable to the employer" or "connected with employment" be removed; (4) that benefits be postponed but not entirely canceled in cases of discharge for misconduct; (5) that benefits be postponed but not canceled in cases of refusal of suitable work.

(e) That the Social Security Board, as authorized by the Social Security Act, as amended, immediately review the operations of the State unemployment