A Catechism of So-Called Labor Relations



By ARTHUR J. TODD, Professor Emeritus, Department of Sociology, Northwestern University, Evanston, Ill.

Delivered at the Principia School of Government Conference on Employer-Employee Relations, Chicago, Ill., February 17, 1945

Vital Speeches of the Day, Vol. XI, pp. 444-448.

I AM supposed to be the keynoter, but as I am not sure that I qualify, except in the light of Mr. Justice Edmond's remark that the successful speaker at a conference of this sort is one who doesn't present a multitude of facts. I am not going to qualify to that extent, but I hope that I am not going to present you with an overloaded burden of facts—at least I will, as your chairman has pointed out, try to open up the subject so that we can see the planes upon which discussion can be carried on. I selected the topicfor today largely because I didn't feel competent to come here with any dogmatic statement. However I do feel confident to ask questions—the questions I ask myself; the questions I see constantly being asked in the press, the questions that come up whenever a group of men come together around the luncheon table.

I remembered that in the distant antediluvian past I taught a Sunday School class in the days of the old orthodoxy, and part of my job was to teach the Westminster Catechism to uncomprehending children. That wasn't the implication in my catechism today, although I did find from that experience that it was much easier for the learned theologian to ask the questions than to supply the satisfactory answers.

The first question which many of you probably know is, "What is the chief end of man?" I suppose the chief end of man is to wonder why we have government. In preparing the questions which I first asked myself, and as I searched through my own consciousness during the time since this assignment was handed to me, I came to the conclusion that I would revert back to the days of my teaching. Herbert Spencer once said that the best teacher is the one who didn't answer all the questions for his students, but who left his students full of unanswered questions. I am going to claim the benefit of Herbert Spencer.

I believe the first thing we encounter in a discussion of this sort is the great variety of attitudes. We learn in the sociological discussion the importance of that problem of human attitudes. Call them sets in mind, prejudices, or fears, if you will, but I prefer the general comprehensive term, "attitudes." As a primary gauge, we will have to recognize that the attitudes on labor relations vary materially from Westbrook Pegler at one end of the spectrum to Senator Wagner at the other, or the attitude that the labor unions were decreed by the thought of the Commandments, or that they had been commanded by the spirit or the letter of the Sermon on the Mount. I am not going to try to cover all the ranges between those extremes. I am going to ask certain questions as they throng to my own mind, and then I am going to select a few for a little more careful attention. I shall begin with the first ones which I think are current in the minds of most business leaders, namely, are labor unions a necessary evil? Are unions the price of past management failures? Are unions necessarily objective? Do labor leaders really lead, or are they just men who sow trouble and reap it to keep their jobs—to keep in power? Should the ideal of management be to beat the union to it? What is likely to be the effect of Mr. Hillman's P.A.C. and other forms of political unionism upon business? Should businessmen oppose a labor party? Can a business or industry deal in a friendly and intelligent way with its employees now under present legislation and the present administration in Washington? What personnel policies would be effective if the National Labor Relations Board or the National War Labor Board were scrapped? Is arbitration a valuable safeguard or a mere evanescense on the surface of industry? What is more important to a favorable understanding with a labor organization, a wage scale or an agreement procedure? Is it possible for employees to be loyal to both an employer and a union?

These are not idle questions, these are questions that have come up in several years of experience as an arbitrator or mediator or student of these problems. There are others however. Is it un-American to form a labor union? Is it un-American or unpatriotic to avoid joining unions? Is collective bargaining enjoined by the Ten Commandments? Does unionism necessarily beget the slow-down or is that an unavoidable circumstance? Is the company union the better type of collective bargaining? Could it be safeguarded against sabotaging by management? Is unionism the price we pay for belated personnel and wage policies? Are unions here to stay? Should you have a permanent arbitrator and constantly functioning arbitration machinery, or should they be set up for occasional needs? Under the present governmental set-up, can you manage your own business? (See the morning paper on that point). If your human organization, as Andrew Carnegie once said, is the most important aspect of business, how can it be safeguarded? Is the New Deal for or against that fact? How much personnel work and research should a business project provide? What is a right?

I hear all the time about "rights"—the right of an employer to manage his own business, the right of a worker to join a union, the rights of labor leaders, the rights of businessmen to get together and organize either for offense or defense. Right and rights, everywhere I hear talk about rights, and so I ask myself, as I have been asking during many, many years of study, "What is a right?" Is a right something in a vacuum? Or is a right always coupled with an obligation? And if so, in deals with government and labor and businessmen, why not talk more about obligations? I suspect we will get much further if we do that.

Just the other day I received from a well-known company which analyzes businesses for a consideration—so called "Hu-Management Engineers"—a circular with an analysis of certain problems and some of these complicated charts, but one thing in that communication struck my attention, "Of one thing you may be sure; tomorrow's labor problems will make today's headaches seem like pleasurable memories." Now that is the real theme of my discussion. Why that gloomy prospect? Of course we do not believe in prophesying erroneously. This was a statement made by one of these experts in business organization and business analysis. If this statement is within the realm of possibility, why is it so? Now I believe that the analysis of an answer to that question will provide material for all of our round tables, so I put that question to you. If it is true, why is it true, that labor relations may be more difficult in the near future than they are now, and the first answer which I would throw out, at least for your consideration, is that so far as the human eye is able to discern (I am speaking about the worm's eye, not the eye of the omnipotent), there apparently is no real profound principle, no real straight forward policy in the nature of labor, but expediency, governing the activities of our national political leaders. That, at least, is an allegation; and in the second place, public exasperation reflected in Congress may result in very inadequate and possibly dangerous legislative attempts to control, or to bring about some order into this situation. I need only to point out to you two flagrant examples that have occurred within the last three or four days which have promoted a fever up and down the spine, not only on Captiol Hill in Washington, but all over the country. Just one word, "Petrillo." All of you know how to spell it The other was the Boston and Maine Railroad case where union leaders refused to permit the company to use soldiers to help clear the streets of heavy snows which had been tying up, virtually paralyzing traffic in the City of Boston. This last case is a sample of the type of incident which brings about pressure on legislators and urges them to whip together some kind of inadequate legislation to control a local situation without giving due consideration to the whole history and background of the case.

A third reason why it. is possible to anticipate even more difficult labor relations is because the general reaction against labor privileges, which have been piling up in recent years, will be accentuated by many of our returning soldiers. I think that is a very important fact, because I get it from everywhere, from Europe and from the Pacific. It may be mistaken and entirely wrong, but we are here today to discuss matters realistically.

A fourth reason is because many workers have been practically herded into labor unions and will, unquestionably, when the pressure is relaxed and the onset of demobilization is here, try to withdraw from the union and the employer will have to bear part of the brunt of this difficulty. Closely associated with that point is the competitive drive between various branches of the labor union itself. You have an example of that in this morning's paper where the C.I.O. accused the A. F. of L. of encroaching upon its preserves, whereupon the A. F. of L. hurls the same charge at the C.I.O. It will not be a jurisdictional dispute between craft unions of one large federation but will be more on the order of a huge battle between these giants of labor organization. Furthermore, because the attempt to actualizes—I have chosen that word carefully—the pretensions to sixty million jobs will run up against present laws, union restrictions, and other handicaps which will exacerbate employee-employer relations with the public. I can refer you to plenty of examples of that sort of thing. One I tore out of the Congressional Record of February 12th, and the following words were taken from an address by a congressman of one of our neighboring states in reference to the promise of sixty million jobs, "A full employment program based on economic fallacies."

A business friend of mine recently showed me a very interesting compilation of post-war fiscal problems and policies by Professor John Coulter in which he had summarized a huge number of post-war plans for the purpose of implementing this promise to the American people that there were sixty million jobs necessary for sound economy. He comes to the conclusion that we could never have sixty million people with jobs, at the very best it would run between forty-five and fifty-five million, but actually, it would be nearer to forty-seven and forty-eight million. You can be sure too that in the attempt to maintain so-called full employment, many new problems with which we have not been familiar or problems which will take on enlarged demands will face us in that attempt.

Another reason is because of the prospective reduction in over-time pay that will be essential to providing these forty-eight or sixty of fifty-five million jobs, and which will inevitably decrease the "take-home" pay. You know that will be a strain on employer-employee relations.

Another reason is because the racial cat is out of the bag, and will be aggressively discussed in both Congress and state legislatures. Perhaps it is called by some fancy name such as "fair employment practices." I saw in the paper this morning that House Bill No. 523 has been passed from committee in the House and will now be up in the House for discussion very soon, and there will be twelve other bills at least calling themselves the same name in the Senate and the House. Several states are also considering the same law, Massachusetts, New York, California, and possibly New Jersey. Many others have similar bills in contemplation. There is a good deal of flux of thought in those Acts. Were they really meant to give the negro his Constitutional rights? I am rushing in where angels fear to tread, particularly in the presence of a distinguished Justice from California, but I feel that this issue must be declared in very plain statements because it could be camouflaged by many carefully worded legal phrases and titles, which could be broken down by clever lawyers and the whole issue confused to the point that the poor negro will be completely forgotten. This question will be vigorously fought out even though the law itself may be passed. In talking with the Clerk of the Committee in the House that is considering and fostering that bill, I asked the other day for certain exem -tion and was told, "The bill does not contemplate covering such things." I asked that religious organizations, fraternal and similar organizations be exempted. He replied to the effect that such organizations are not dealing in inter-state commerce. I may be wrong, but I am perfectly willing to bet, in all deference to the Supreme Court of California, that there are lawyers able to prove that almost anything is involved in inter-state commerce. The broader the scope of the bill gets, the more opportunities there are for evasion. In any event, this is one of the problems that will have to be faced by business leaders. This is principally why my friend was entirely right when he said that problems in the future are at least going to be more difficult than those we have been facing in the past.

From the standpoint of a student of labor trying to get a perspective on the situation, I am inclined to feel that the next reason is even more important, namely because through the hyper-trophy and hyper-activity of a National Labor Relations Board and a National War Labor Board, both labor and management have been conditioned away from negotiation and collective bargaining and have been taught to run to government with every little problem. There has been no premium placed on patience; there has been no premium placed on diplomacy; no premium on the give and take which is essential between management and workers. It has come to such a pass now that the War Labor Board announced that they had an application bad-log of three thousand cases. The War Labor Board has been unjustly accused of obstruction and intentional delay. From my dealings with the Board—I was associated with it for nearly two years—I didn't find this to be true. There was a tendency because of the multiplicity of the cases to get to a situation where it was just beyond human endurance. Working twenty-four hours a day, seven days a week, it was impossible to grind out the grist in that hopper. We had cases waiting for eight months and some almost a year and a half—it was worse than the Supreme Court. The reason was that the War Labor Board had not laid down the rules sufficiently frankly to the contending parries. The Board should have said to these contending parties, "try to settle your own differences and don't come running to us every time you need to have your noses wiped." A case came to the War Labor Board the other day at Kansas City in which the main point of disagreement was on how thick should a slice of picnic ham be cut. That reduces the thing to an absurdity. Just think of going to the Supreme Court to ask how thick a slice of ham should be and how much fat should be on a slice of picnic ham.

In self-defense, and in order to get through with this mass of cases the War Labor Board has finally been compelled to come to its FIVE POINT PROGRAM, published last week. You will find it in the newspapers.

Another reason arises from the demand for a higher living scale to attain the necessary figure of $140,000,000,000 of annual national income which Mr. Beards ley Ruml and others—not Mr. Roosevelt—say will be necessary to maintain full employment. Somebody will have to pay for that higher living scale. Who is going to do it, and how is it going to be done? It has to come out of the pay envelopesand the employer has to supply the pay envelopes. In addition to the pressure from cutting down overtime, which is essential to the maintenance of employment, you will apparently have a conflict there between that necessary reduction of the "take-home" pay and some kind of increase tbat is going to build up to the point of a higher living scale necessary to float that annual income of $140,000,000,000.

If there were no other problems than that one alone, I would say to business leaders and management experts, "There is something that will demand about all the intelligence with which God has endowed you." But this isn't all! Employers themselves are likely to go on strike against the National War Labor Board and other governmental agencies which have forced them without due process of law—the employer would say—to pay for work not done. Now that is one of the most sensitive points which I discovered in handling labor cases, and in discussing labor problems with employers. It is true that I have been a party to increasing vacation pay, as an arbitrator with the War Labor Board, or as a negotiator or mediator. I have never ordered it because I felt that it was not my province, although I might have had the backing of the War Labor Board on that point. I felt it should be written into a contract through the process of collective bargaining, or, if you want to call it so, "horse trading." I had no right to order an employer to give vacations with pay. I am very much in favor of vacations, and particularly of vacations with pay, because I have enjoyed this arrangement for many years as part of my experience in universities. This was not by order of the Government. It was an arrangement between myself and the contract with the university. Speaking of my university experience, I enjoyed one sabbatical year in my 35 years. The Government didn't order that either, I had to negotiate. At breakfast this morning, the distinguished jurist from California revealed an uncanny knowledge when he spoke of "An ace in the hole." I had an ace in my hand which I could play, and when I played it, I got my sabbatical leave.

Personally I disapprove, and I think it is one of the questions which is turning the minds of employers against labor organizations, of the Government requiring employers to pay for time, operations, and activities that are never performed. We fought a war once on a problem that was not so far removed from this issue. We fought against "taxation without representation" and maybe my politics have gone awry, but I suspect that presently much the same principle is involved in the attitude on the part of business leaders. At least, if they are compelled to pay, they are going to register a protest against paying for, let's say, eight men when one or two could do the job. You are no doubt familiar with the fact that Mr. Petrillo recently has compelled a radio station in Minnesota to take on stand-by musicians, "feather-bedding," I believe they call it. What do they do? If any of you saw that ridiculous show of Olsen and Johnson, you will recall that all through it there was a man sitting right on the edge of the stage reading a newspaper. He didn't pay any attention to what the actors were doing, or how the audience was reacting. He was the stand-by man, and he typified a great many of them. But I can assure you that businessmen don't laugh at any such thing. It isn't merely the economic loss. It is the invasion of the fundamental rights and privileges of the businessman and the citizen.

Another reason, and this I can pass over lightly because it is so axiomatic, is, as Stuart Chase points out, the difficulties of quick conversion if, when and as that comes, will redound to the benefit of the larger business concerns, and probably to the disadvantage of the smaller ones. American business is going to bear the burden of this aggravated situation, and there will not only be, we may say, difficulties in the field of labor relations within a given business, but difficulties between various groups of businesses as the result of the turmoil of this reconversion to normal industry.

There is another point, and I again refer to the experience of you gentlemen in business, although it concerns me as a consumer, and that is that there is likely to be an aggravation of our labor relation situation because business men are so uncertain as to the attitude of political leaders on such matters as tariff, taxation, the virtual confiscation of surpluses which might well be used to finance expansions at a critical moment when such expansions would be most necessary, the destruction, or at least the tempering of initiative, incentive and the impulse to innovation. For instance, nobody, so far as I can make out, weighs the right or wrong of so-called "anti-trust" activities on the part of an aggressive Department of Justice. I do know that it has a profound effect by disturbing the morale of the businessman and naturally whatever disturbs him, insofar as organizing his business, getting raw materials, working them up, developing his business organization, is bound to effect many in his relation to his employees. Many of these effects you see are indirect, but nonetheless, they are effective and important.

Another reason, also on this score of uncertainty, is the uncertainty of how long the present type of administration will prevail in the nation's Capital—and I don't refer to Mr. Wallace's confirmation or who is going to spend the billions of the Reconstruction Finance Corporation. There are other points. I don't know what the legal profession thinks about the present so-called "packed" Supreme Court, but is there any pattern by which you can determine the future of business in the hands of this type of court? There is an insurance case up for legislation in Congress which amounts to an attempt to get around a Supreme Court decision (United States v. South-Eastern Underwriters Association, 322 U. S. 533 1943). I do know that in all of the states it has produced profound repercussions, and the same thing is true of other lines of business. I know the disturbances which came to the minds of many, possibly yours, in the report of 265 federal judicial appointments made by the present administration, in which they were able to find only two Republicans, who had the necessary qualifications required for such a distinguished profession. It is not known how many votes it changed, but the make-up of the courts is the significant thing in the minds of businessmen.

These are some of the reasons why I think it is quite possible to entertain the idea expressed by this business analyst that we should be prepared for an increased interest in aggravated employee-employer relationships.

Does the present administration deliberately cater to the labor vote? I will leave the answer to that to your conscience. I have here the reports of the committee of resolutions adopted by the 11th National Congress on Labor Relations, held in Washington under the auspices of United States Department of Labor. These are the official resolutions drawn by that Congress, and I will let you judge them for yourselves.

Has a union or its leaders the right to commit its members to a political party, or policy, or candidate and to force assessments on members to pay campaign costs? You have seen that issue thrashed out in the newspapers of late in connection with the Cecil DeMille case. He has tried to withdraw from the union, but the court says he can be forcedto pay the levy which was imposed on all union members for political support. I don't know the right or wrong of the case, but it is an aggravated situation to be carried to the highest court.

Is it possible for an employer to talk to his employees on the matter of whether or not they should join the union? In a recent Texas case that issue was implied. This is something that you are going to have to face. You may have to get legal counsel on it in the future. It looks as though that question is going to have to be settled in the highest court.

That brings up another question as to whether the state should actually supervise labor relations and labor activities in the future. Just as the court decision in the Texas case, is the principle of compulsory arbitration now fixed in American labor relations? Should it be? Does either labor or management favor it? Up until recent years, both labor and management opposed compulsory arbitration, and labor organizations opposed it more strongly than employers. Now we find employers offering stronger opposition to such arbitration. Whether they like it or not, both parties have been conditioned by confusion resulting from the administration and the War Labor Board. I have had many arbitration cases by directive from the Regional National War Labor Board. Some of the issues involved had been written into their agreement by the contending parties and worked out automatically beforehand. It simply means a protection, something in reserve—the judge's "ace in the hole."

Another question you gentlemen will have to determine among yourselves is, "who makes the best arbitrator?" What kind of a person, what background is necessary for a good arbitrator? A college professor, a lawyer, a minister? I have heard many people complain about a case that has

been manhandled by a minister. Employers and labor leaders are very doubtful about having judges or lawyers come in because they have pre-conceived ideas and they can't get away from formal court procedures. The first case I handled in Chicago involved arbitration between an employer and some negro employees. The lawyer for management sat at the end of his table looking more and more mournful as I sat there allowing these negro labor leaders to pour out their woes. I accorded them their true rights and privileges in doing so, after cautioning them that it was going to cost money the longer they talked because the whole procedure was being taken down. Finally the management lawyer couldn't stand it any longer. He rose to his feet and demanded, "Is the employer going to have a chance in this case?" He was expecting me to overrule the statements of these men as immaterial and retire them. At the proper time it was his opportunity to be heard and this he was entitled to. Under our system of government, as under any decent system of government, I was giving those labor leaders their so-called natural rights to "spill over." Naturally the employer's side of the case was heard, not through the lawyer but through the general manager of the business. It is probably wise that labor leaders have elected to choose other types, not necessarily college professors, than those of lawyers to function effectively as arbitrators.

This brings up another question—the matter of arbitration and the handling of these issues by some governmental agency. Should governmental agencies like the National War Labor Board have powers which are not subject to review by the courts? This issue is now before the Congress.

I want to ask myself and you whether government is likely to intervene in labor relations? As businessmen, I suspect you would want to know the answer to this question. I have had no access, no pipe-line to the White House or to others determining the policy of the United States in that particular, but I suspect so long as the war emergency lasts, we will have to have some sort of government review, government encouragement, and government direction in the matter of labor relations. I want to ask if there is any one way to arrive at a sound wage policy? I did want to ask you if moral good will could be built up in a concern working with a union as compared with one working without a union? I did want to ask, where does the public get off? In all these arrangements of contract review by government agencies, where do you and I—the consumer—get off in that complicated set-up? Where is the consumer represented in any of these deals? We usually are not represented because we are not organized. They have tried ineffectively to have the consumer's views represented by consumer views in Washington, where conditions are entirely different from any other location in the country.

This is the type of question which would be essential for you as representative business and professional men and women to thrash out, not merely in the round tables today, but in the course of your daily business for an indefinite period to come, and I say that, not as a professor, I say it as the result of intuitive feelers which I have; I feel it in my bones, so to speak. I am rather glad that I don't have to work out these problems with or for you. I am merely the analyst, and as one giving you a final code, a sort of scientific Sermon on the Mount.

You have the wherewithal mentally and spiritually to work out these problems. If this analysis will help you forewarn yourselves, prepare yourselves, protect yourselves, then I will have served my purpose, and will have acquitted myself of the mandate which was given to me by your program committee.