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The International Brotherhood of Teamsters has represented Pan Am Service Supply Clerks at the Air Force Eastern Test Range since March, 1959, and Clerical and related employees since February, 1969. We have maintained an outstanding record of labor harmony and, in fact, have received commendations from Brig. Gen. H. J. Sands, Jr., U.S.A.F., and Maj. Gen. Vincent G, Houston, U.S.A.F., for this record.

We were also the first union representing employees connected with the Space Program to sign a no-strike pledge for work performed at the government installations at Cape Kennedy. Our members have honored this agreement and have worked hard to further the American Space Program.

These same members, whose average service is 11 years, are now faced with the prospect of drastically reduced wages or complete loss of work. In many cases, these long-service employees who lose their jobs will find it very difficult to obtain other work because of their age and inability to pass pré-employment physicals, having spent their prime working years connected with the Space Program."

This Union has negotiated in good faith for benefits and wages, and, as a part of those negotiations, signed an understanding that the wage increases and other cost items would be subject to the approval of the Air Force as reasonable reimbursable expenses under Pan Am's contract with the Air Force.

If the present Range Contractor recognizes these same benefits and wages, the government will surely award the new range contract to an employer who will pay far lower wages and will not recognize our members' long service.

It should also be noted that many of the classifications covered by our Agreements are comparable to Civil Service jobs used by the Air Force and NASA at the Cape. The following are some examples of Civil Service and IBT rate ranges for similar jobs :

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Additionally, the Civil Service annual leave policies, retirement, and relater! benefits are comparable and, in some cases more liberal than those negotiated for Pan Am employees covered by IBT Agreements.

The workers fail to understand why they should be subjected to wage cuts or loss of their jobs when their rates are not out of line with Civil Service and we are both doing work for the Government. They were told by'a representative of the Government at a public meeting that Congress, controlled the wages for Civil Servants and contractor employees were subject to the demands of the market place. This, he said, was the American Way. The real inequity of this philosophy is that in the Cape Kennedy area the market place has been substantially a function of Government activity and procurements since 1953. Therefore, the Government now is seeking to take advantage of a soft labor market which they themselves created. We cannot understand why the Labor Department has detemined that an identical procurement at Vanderberg AFB should be handled in accordance with the provisions of the Service Contract Act, that is competitive bidding on the basis of a wąge determination, but refuses to apply the same law at Cape Kennedy..

It becomes painfully clear to us that the competitive bidding procedure is being used in the Cape Kennedy area to create a cut-throat atmosphere where the working man, fearful that he is about to become unemployed will work for sub-standard wages so that he can provide for his family, at least the bare necessities. Continued employment at these wages will force him to substantially reduce his standard of living and, will probably cause him to abandon his investment in his home and community. This committee has heard of the same situation which occurred 'when TWA was substantially under-bid by a contractor who offered wages 40-50% below those which were paid by TWA, A clear picture of what will happen has been demonstrated by that procurement won by the Boeing Company at the Kennedy Space Center.

I am intimately familiar with this situation because I have been approached by the Boeing employees seeking to be represented by the IBT. These employees,

some who were hired from TWA and some who were previously unemployed, are working at the reduced wages only long enough to find other employment or to accumulate sufficient money to move their families to other locations. In talking to them they informed me that they have experienced approximately 20% turnover within their departments and that similar conditions exist in other departments.

It is abundantly, clear that the Government is actively and forcefully engaged in reducing the wages and benefits of employees working on service contracts and that this is being accomplished by circumventing the provisions of the Service Contract Act. Rather than apply the law of the land the Government has applied the law of the jungle. Up to this moment, the Labor Department has steadfastly refused to recognize the situation.

Mr, Chairman, the workers have seen what the term competitive bidding under these conditions will, mean to their families and lives. I personally believe that the matter should be labeled a disaster in the making. Facing that disaster these people will react in a most predictable way. The same dedication that has gone into the fine record they have built will be channeled into a resistance of what they know is a raw deal from their government. Slowly the realization is sinking in that for all their efforts and cooperation the pay off is right around the corner and what is their reward to be, the insulting and degrading proposition, work for half price or give up your job. I can tell you that there already is unrest and great concern among the workers as step by step they get closer to this possibility. When the NASA procurement was being competed, no one was really sure of what the actual results would be. Now there is nothing left to the imagination. The picture isn't pretty, the reaction of the people will be less attractive,

I personally believe that the workers involved and the American people have å right to expect better than this from their government. The environment surrounding this procurement at Cape Kennedy demands that the Labor Department carry out the intent of the Congress and make wage determinations in all labor categories involved.

Mr. Chairman, I thank you and the entire committee for this opportunity to present the views and feelings of the workers and their families.

It is in their behalf that I respectfuly urge you and this committee to do all within your power to prevent this obvious and potently harmful injustice.

Mr. SWEENEY. Thank you, Mr. Chairman.

I have brought with me Sam Casella, our business agent on the job at Cocoa Beach, and with your permission, I would like very much that you would listen to his presentation, because he has been very close to the scene for some 15 years and has an intimate knowledge of our members at Cocoa Beach.

Mr. THOMPSON. I am glad you brought him with you, and we would be delighted to hear him.

Mr. CASELLA. We also have been commended by two of the commanders for our cooperation and all those things that go with making harmonious labor relations.

We have given the no-strike pledge, as you have heard the other witnesses say. The average service of our members at the eastern test range is 11 years. That is the longevity that they carry.

They are going to find it very difficult to find other employment, as you already have heard, because of their age and preemployment tests and what have you.

Now, we have as part of our contract with the employer signed that all the increases and all the benefits that we have agreed to between us are directly subject to the Air Force's approval as reasonable and reimbursable, and they have been held so over the years.

Now, Pan American recognizes those same benefits and wages. If they do, they are not going to make this bid, as you have already heard.

I do have some comparisons here in my statement with certain categories of work which are civil service oriented. You can see in most cases Civil Service does get more than we do.

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In one or two cases we get more, but they are comparable.

Also, the benefits that Civil Service receives are comparable, and in some cases are more liberal.

The workers there fail to understand why it should be that Civil Service employees are subject to losing their jobs when, in fact, Government work is being paid at the same levels that they are receiving

That was somewhat explained in a public meeting held at Merritt Island, Fla., last summer.

We were told the real reason was that Congress took care of the civil servants, and everybody else was subject to the conditions of the labor market.

Then we find what that really means is that the Government is taking advantage of a labor market that they themselves have created, an overabundance of workers, and they are going to take advantage of that.

What really hurts, as you have already heard, in the Cape Kennedy area since 1953, Government procurements have been the market. It is all we have got down there. That is the real inequity of that situation.

We also feel there is nothing more going on down there at Cocoa Beach than the government using everything they can to get away from the provisions of the Contract Service Act.

They are circumventing it. They are creating a cutthroat atmosphere. As we have already seen in the TWA-Boeing situation, it has already worked that way

To sum it up, as I have said in my statement, I believe that the Government is actually applying the law of the jungle rather than the law of the land which is extremely unfortunate.

I think we are all entitled to more than that. The employees down there are extremely upset, as you have heard other witnesses say here, and there is going to be trouble at Cape Kennedy if this thing doesn't turn around. They feel they are getting a raw deal from the Government, and I couldn't agree more about that.

With that, Mr. Chairman, I would want to thank you for giving me the opportunity to present these views and feelings of the workers. That is what it amounts to..

I urge that this committee do all possible to correct the situation. Mr. THOMPSON. We are going to make every possible effort. I want to thank both of you gentlemen.

Again, it appears that, thanks to you and other witnesses and the survey that Senator Gurney had done, we are going to have a rather clear picture at least in a number of categories of comparability, and if the Secretary doesn't have the people to do the job at the space center as they did it at Vanderburg, maybe we can persuade him that these statistics which you have given us are accurate and ought to be used as the base for a determination so that there can be some bidding other than on a $1.60 basis.

With that, I thank you very much, and announce that the subcommittee will adjourn, to meet in this room at 10 a.m. tomorrow.

I will also insert into the record several letters I have received from workers in the Cape Kennedy area, and a letter from Mr. David Jacobs, who testified before the subcommittee earlier this year on the situation at Laredo Air Force Base.

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(Whereupon, at 4:30 p.m., the subcommittee recessed, to reconvene at 10:00 a.m. on October 14, 1971.)

BREVARD COUNTY CENTRAL LABOR COUNCIL,

EAU GALLIE, FLA., October 4, 1971. Hon. CONGRESSMAN THOMPSON : The news of your committee to investigate the Secretary of Labor's decision on denial of a wage determination within the 'Services Contract Act of 1965' for the Air Force Eastern Test Range recompetition, was received as good news in this community. I

The 'Services Contract Act of 1965' certainly appears to have the intent of protecting the support contract worker from suffering great losses when awarding government contracts. Apparently the Secretary does not see it this way but in retrospect says applying a wage base would negate President Nixon's economic program. Without a wage determination applied wages would be cut and millions of dollars would be gone from this area and the entire economic situation would be endangered.

The people in this area are well aware of the situation and very displeased with the Labor Department's decision. If in any way reconsideration can be fostered by your committee for that decision we would be forever grateful. Thank you for your consideration in this matter. I remain, iii. Sincerely yours,,

.: Joun T. McCabe, President.

MIM, FUA., September 30, 1971. DEAR CONGRESSMAN THOMPSON: Enclosed is a copy of a letter that I am sending to the Secretary of Labor which I feel reflects the feelings of many people here in the Cape Kennedy area.

Any help you can give us in this matter will be greatly appreciated. We are very hopeful that the hearing scheduled in October will correct this problem, Respectfully yours, :: 1

si ini dan ..Fr, WILLIAM. F. HAMILTON. } Enclosure.

soonl .

!in' is! Vis,'.

MIMS, FLA., September 30, 1971. DEAR MR. SECRETARY: I am writing in reference to your September 3, 1971, decision to not make a wage determination at Cape Kennedy, Florida.

First, the two reasons you gave for your decision were totally wrong. In fact, our wages have increased less than the cost of living over the past six years (RCA/IBEW 2088), ! .

Second, all the union's involved have an outstanding record with a minimum amount of time lost due to strikes or other labor problems. Nevertheless, we will not stand for any type of "wage busting” without doing everything possible to prevent it.

If this contract is awarded to any company for less wages than is now paid, I would predict a very long and bitter strike here in 1972.'' Respectfully yours,

! !! , 'it, WUTIAM F. HAMILTON. . ,

i
! MELBOURNE, FLA., Oct. 5, 1971.

to DEAR CONGRESSMAN F. THOMPSON, JR. : We feel that the decision made by Secretary of Labor Hodgson on Service Contract Act of 1965 is Unfair.

We hope you will inform him that Service Contract Act 1965 was to be remedial in nature and not punitive. In addition we hope you will also inform him of our intention to vote against the incumbent Administration unless his decision is reversed.. Yours truly,

MR. AND MRS. EMILE T. CHARLAND.

1904: titi (Djof Use.' EAU GALLIE, FLA., October 2, 1971,
ressman FRANK THOMPSON, Jr.,

s. , .
ressional Office Building, ti,
hington, D.O.

As an employee under the Cape Kennedy Missile Test Contract with
would like to ask your support in preventing “Wage Busting."

This can be done by your requesting an Area Wage Survey by the Department of Labor before the new contractor is selected sometime in the spring of 1972. Thank you. Sincerely,

D. M. DYER.

MELBOURNE, FLA., September 24, 1971. Congressman FRANK THOMPSON, Jr., Congressional Office Building, Washington, D.C.

DEAR CONGRESSMAN THOMPSON: The Air Force has recently announced its intention to put up for bids, the Air Force Eastern Test Range support contract (PAA/RCA), for the first time since July 1, 1953.

NASA, recently, put its support contract up for bids, at the Kennedy Space Center and as a result the employees of TWA were forced to take pay-cuts of approximately 30%.' ***

As an eighteen year employee of RCA, I don't want this to be my reward for the many years of service I have given. Remember, we helped pioneer the range. Most of us have given 15 to 18 years of our lives and it is not easy to start over again. Reduction in pay, stopping our pensions and dropping our benefits. Think how much the government could save by eliminating all Air Force and Civil Service retirements and benefits, and let them all start over in the lowest clasifications. Also, we have computed that a change of contractors would require that the Air Force reimburse the contractors for approximately $12,000,000 in severance pay which they would be required to pay, plus additional money for relocation. Is this not a terrible waste of government money?

On September 9, 1971, Secretary of Labor Hodgson announced that the Department of Labor refused to make a wage determination as required under the Service Contract Act of 1965. In explaining his decision, he gave'two reasons: (1) Your wages are much higher than they should be. (2) To make a determination might be prejudicial to the public interest in the success of the President's economic program to combat inflation. We all know that neither reason given by Secretary Hodgson will not stand up, even under cursory examination.

Your cooperation in this matter is of vital importance to our; overall attack on the Secretary of Labor's decision. i , Respectfully yours, : ,

. ; . ; ! Link

S ., ROBERT J. MEISCHEID.

EAU GAULIE, FLA!, September 27, 1971. Congressman FRANK THOMPSON. Jr. Congressional Office Building, "" Washington, D.C.

DEAR SIR: I would like to express my displeasure on the stand that Secretary Hodgson has taken concerning the contract for Cape Kennedy. The Secretary of Labor's decision not to honor the Contract Services Act and make a wage determination is apt to cause more labor problems here than he expects. It could and probably will have a definite effect on the way Brevard County votes. WE WILL NOT TAKE A WAGE CUT. The wages paid here are not any higher than in other areas also our cost of living is no lower. HOW MANY OF THE WORKING CLASS ARE WILLING OR ABLE TO WORK FOR 12 OR LESS OF THEIR PRESENT SALARY? We do not, can not and will not.3 ust' I ask your support to have this decision reconsidered. Respectfully,

JOHN R. STERN.

Cocoa, FLA., September 27, 1971. Congressman FRANK THOMPSON, Jr., Congressional Office Building, Washington, D.C.

DEAR SIR: I deplore the decision by the Labor Dept, to ayert a wage determination survey in the KSC area, and will not stand still for a wage cut after fifteen years of faithful service in the interest of our space effort. wie

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