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U N IT E D S T A T E S D E P A R T M E N T O F L A B O R
Frances Perkins, S ecreta ry
B U R E A U OF L A B O R S T A T IS T IC S
Isador Lubin, C om m issioner
+
Characteristics
of Company Unions
1935
Prepared by
DIVISION O F IN D U S T R IA L R E LA T IO N S
FLO R EN CE P E T E R SO N , C h ie f
Bulletin N o . 634
June 1937
U N IT E D ST A T E S
G O V E R N M E N T P R IN T IN G OFFICE
W A S H IN G T O N : 1938
F o r sale by the Superintendent o f Documents, Washington, D . C.
Price 30 cents
ACKNOWLEDGMENT
This report was prepared under the general supervision of A. F.
Hinrichs, Chief Economist, and Florence Peterson, Chief of the
Industrial Relations Division. The study was under the direction of
David J. Saposs until he joined the staff of the National Labor Rela
tions Board in December 1935, when the preparation of the report
was assumed by Joseph J. Senturia. Several chapters were written
by Eleanor Davis and John V. Spielmans.
The chapter on legal aspects (appendix I) was written by Henry W.
Lehmann except for the section dealing with the present National
Labor Relations Board, which was written by Howard Lichtenstein,
attorney of the Board.
Assistants were: Stella Hahn Moss, Alec Mo watt, Daniel Feins,
Marion Dudenhoefer.
The following field representatives were engaged in the collection of
data used in part III: Louis R. Becker, Katherine P. Ellickson, Frank
Femback, Ralph Hetzel, Jr., Daniel House, Henry W. Lehmann, E. B.
Mittelman, H. E. Riley, H. O. Rogers, R. Carleton Smith, Cleon O.
Swayzee, and Melville H. Walker.
ii
CONTENTS
P age
Preface_____________________________________________________________________
Introduction_______________________________________________________________
Index______________________________________________________________________
vii
1
301
Part I.— Historical Background
C hapter I.— Developments in pre-war and war periods__________________
C hapter II.— Developments after the war period_________________________
7
19
Part I I .— Extent and Characteristics o f C om pany Unions
C hapter III.— Types of employer-employee dealing______________________
C hapter IV.— Types of employer-employee dealing— telephone, tele
graph, and railroad industries___________________________________________
C hapter V.— Characteristics of 592 company unions_____________________
32
56
60
Part I I I .— Organization and Functioning o f 126 C om pany
Unions
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
C hapter
VI.— Conditions attending the formation of company unions___
VII.— How company unions are established_____________________
V III.— Ascertaining the worked choice_________________________
I X .— Constitutions of company unions__________________________
X .— Membership________________________________________________
X I .— Finances and dues_________________________________________
X II.— Officers and representatives_____ _________________________
X III.— Committees______________________________________________
X IV .— Employee meetings and participation____________________
X V .— Procedure for dealing with employer_____________________
X V I.— Collective agreements, arbitration, and strikes__________
X V II.— Matters discussed or negotiated________________________
X V III.— Wage and hour negotiations___________________________
X I X .— Welfare and benefit activities____________________________
X X .— Contacts between company unions_______________________
X X I .— Contacts with Government agencies_____________________
X X I I .— Coexistence of company unions and trade-unions______
X X I I I .— Summary and conclusions_____________________________
78
85
93
99
108
114
120
130
140
147
154
162
170
181
184
187
191
199
Appendixes
A ppendix I.— Company unions and the law of collective bargaining_____
A ppendix II.— Case histories of the establishment of company unions___
A ppendix III.— Six case studies of changes made in existing company
unions____________________________________________________________________
A ppendix IV.— Scope and method of the mail inquiry____________________
A ppendix V.— Scope and method of the field study______________________
iii
209
257
270
280
286
CONTENTS
IV
T a b le s
Page
T a b l e 1.— Distribution
of establishm ents
by
m ethod
o f dealing and
industry groups, A pril 1 9 3 5 ____________________________________________________
35
T a b l e 2 .— D istribution o f workers b y m eth od o f dealing an d industry
groups, April 1 9 3 5 _______________________________________________________________
T a b l e 3 .— M eth od of dealing w ith em ployees, b y industry, A pril 1 9 3 5 ___
37
42
T a b l e 4 .— D istribution o f establishm ents dealing w ith em ployees b y
m eth od indicated, b y size of establishm ent, A pril 1 9 3 5 ____________________
46
T a b l e 5 .— D istribution o f workers in establishm ents dealing w ith e m
ployees b y m ethod indicated, b y size o f establishm ent, April 1 9 3 5 ______
T a b l e 6 .— D istribution o f establishm ents in each size group, b y m ethod
of dealing w ith em ployees, April 1 9 3 5 ________________________________________
48
48
T a b l e 7 .— D istribution o f com p an y unions in A pril 1935, b y period of for
m a tio n _____________________________________________________________________________
51
T a b l e 8 .— Establishm ents dealing w ith trade-unions in April 1935, b y
period in which dealings were b egu n __________________________________________
52
T a b l e 9 .— C om pan y unions in A pril 1935, b y industry group and tim e of
establishm ent_____________________________________________________________________
T a b l e 10.— E x te n t to which com p an y unions established before 1933
were reorganized under th e N . R . A __________________________________________
54
55
T a b l e 11.— M eth od o f em p loyer-em ployee dealing on class I railroads,
b y craft or class of em ployees, A pril 1 93 5 ____________________________________
59
T a b l e 12.— Participation provisions o f com p an y unions, A pril 1 93 5_____
T a b l e 13.— Participation basis o f com p an y unions in A pril 1935, b y period
60
of form ation _______________________________________________________________________
T a b l e 14.— D ues provisions o f com p an y unions in April 1935, b y ty p e of
61
dealing_____________________________________________________________________________
T a b l e 15.— A m ou n t of m o n th ly dues of com p an y unions, A pril 1 9 3 5 _____
T a b l e 16.— Benefit provisions an d reported m em bership in com p any
unions having optional m em bership and charging dues, April 1 9 3 5 ______
T a b l e 17.— Frequency of m eetings of com pan y-union representatives,
April 1 935____________________________________________________________
T a b l e 18.— Provisions for p ay m en t o f com p an y-union representatives,
April 193 5 _________________________________________________________________________
T a b l e 19.— R a te o f p ay m en t o f com pany-union representatives, April
1 9 3 5 ________________________________________________________________________________
T a b l e 2 0 .— Source o f p ay m en t o f com pan y-u n ion representatives, A pril
62
62
63
65
65
66
1 9 3 5 ________________________________________________________________________________
T a b l e 2 1 .— Frequency o f com pan y-u n ion general m em bership m eetings,
66
April 1 935_________________________________________________________________________
T a b l e 2 2.— A rbitration provisions in com pan y-u nion constitutions, A pril
67
1935, b y tim e of establishm ent of com pan y union__________________________
68
T a b l e 2 3.— M atters reported discussed b y com pany unions w ith m anage
m en t between January 1933 and April 1 93 5 __________________________________
70
T a b l e 2 4.— Contacts of com p an y unions w ith com p any unions in other
establishm ents, April 1 9 3 5 ______________________________________________________
73
T a b l e 2 5 .— Establishm ents w ith personnel managers, b y size o f estab
lishm ent, April 1 9 3 5 ____________________________________________
74
T a b l e 2 6.— C om binations of attributes am on g com pany unions studied,
April 1 93 5 _________________________________________________________________
T a b l e 2 7 .— Period of form ation of com p an y unions covered in field s tu d y T a b l e 2 8.— Labor conditions a t tim e of form ation of com p any unions___
74
79
82
CONTENTS
V
Page
T able 29.— Forces responsible
for organization of company unions
studied, by time periods______________________________________________
T able 30.— Method of ascertaining the workers’ choice_________________
T able 31.— Number of company unions with specified attributes, by basis
of participation, spring of 1935_______________________________________
T able 32.— Committee machinery in company unions, spring of 1935___
T able 33.— Frequency of company-union committee meetings, spring of
1935___________________________________________________________________
T able 34.— Proportion of estimated total employment in April 1935 cov
ered by replies to questionnaire_______________________________________
T able 35.— Distribution of establishments included in field study, by
industry group__________________________
T able 36.— Distribution of plants covered in field study, by States_____
86
93
111
134
138
282
290
291
Charts
C hart 1.— Types of employer-employee dealing_________________________
40
C hart 2.— Types of dealing with employees in establishments of different
sizes_____________________________________________________________________
47
C hart 3.— Dominant factors at time of formation of company unions,__
81
C hart 4.— Ascertaining the workers’ choice regarding the setting up of
company unions_________________________________________________________
97
C hart 5.— Employee contributions to company-union finances__________
117
C hart 6.— Committee machinery in company unions_____________________
133
C hart 7.— Frequency of general employee meetings_______________________
143
PREFACE
This study was undertaken by the Bureau of Labor Statistics in
1935, in an attempt to present a factual portrayal of the extent of
the various types of employer-employee dealings and of the character
istics of company unions. The study was pursued along two lines:
Questionnaires were mailed in April 1935 to approximately 43,000
representative establishments. Of the replies received, 14,725 were
usable. These replies present a quantitative picture of the extent of
the various types of employer-employee dealing, as well as of certain
major characteristics of that form of group dealing referred to as
company unionism. Data based on this part of the study were sup
plied by employers, and were limited to matters which could be
readily tabulated.
In addition, members of the Bureau’s staff visited 125 firms in
which 126 company unions existed, interviewing employers, personnel
directors, officers and members of the company unions, trade-union
members, and local citizens who were familiar with the local situation.
Copies of minutes of meetings, constitutions, agreements, and other
pertinent literature were also obtained.
Despite conflicting evidence and attitudes revealed in the material
presented to the agents of the Bureau, it has been possible to develop
an essentially accurate description of a larger number of company
unions than has ever before been studied. These case studies represent
a cross section of all company unions and provide the material for
intensive examination of their characteristics.
The date of the study should be noted. It was made just before
the decision of the Supreme Court in the Schechter case, in May 1935,
which invalidated the National Industrial Recovery Act and the
system of codes and labor boards set up under that act. The study
thus describes the situation at the end of the N. R. A. period. It
does not reflect the extensive changes in methods of employer-employee
relations which have taken place under the National Labor Relations
Act, especially since the decisions of the Supreme Court of April
1937, upholding the validity of that legislation.
The study is not merely of historical value, however. It describes
company unions at a time when many were undergoing or had under
gone the changes in form which since then have become more general.
vu
VIII
PREFACE
The more recent form of company union, referred to by some as
“ independent” union or association, is essentially the optional-mem
bership type of company union discussed in this study. Nearly half
of the company unions included in the field study were of this optionalmembership type. Since company unions at the present time are
confined to employees of a single plant or company, the findings of this
study pertaining to such limitations are also relevant.
In view of the increasing interest of Government agencies in the
problem of collective bargaining and in view of the impact of legis
lation and governmental policy upon the extent and types of com
pany unionism, there is added an appendix on Company Unions and
the Law of Collective Bargaining. This discussion covers pertinent
legislation, judicial decisions, and rulings of the labor boards up to
May 1937. Short illustrative descriptions of particular cases are
presented in appendixes II and III in order to illustrate the situations
out of which company unions arose and the procedures by which
they were established and modified.
I sador L ubin ,
Commissioner of Labor Statistics.
June
1,
1937.
Bulletin J^o. 634 of the
United States Bureau of Labor Statistics
Characteristics o f Company Unions
Introduction
In the bargaining process between employers and workers, employ
ers have usually had an advantage because of the scarcity of jobs
relative to labor supply, and the worker’s inescapable need for a job
in a society where food and shelter can be had only for money.
The goal of the labor movement is always, in one way or another,
to counteract this advantage of capital. Labor’s attack has generally
followed two lines: Through political action it has sought to enlist
the coercive power of the state, and through labor organizations it
has sought to develop collective power adequate to bargain on terms
equal with capital. The latter has been the principal means employed
by the American labor movement, although at times and upon specific
issues labor has sought assistance from government.
Realizing that its bargaining power rests upon relative abundance
or scarcity in the labor market, workers’ organizations strive for job
control. To attain this, labor has sought to expand its organization
lines to the same limits as are found on the side of business. As
market areas expand, as employers and capital organize more and
more on national (or international) scales, labor strives for organiza
tions of similar scope. The ultimate strength of organized labor’s
bargaining power is its ability to withhold its services, that is, the
possible or actual use of the strike.
This industrial set-up is one of potential conflict. It logically gives
rise to the question as to whether there may not be a less antagonistic
and wasteful way of achieving the desired ends.
Certain groups have advocated the company union as the affirma
tive answer to this question. They contend that the coercive power
of national labor organizations is not needed, that they are indeed a
hindrance to labor. They claim that reasonable, fair-minded negotia
tions between the workers and management within a given establish
ment are possible, that satisfactory arrangements are more easily
achieved in the absence of external compulsion upon the employer,
and that workers in particular establishments will appreciate better
than agents of labor organizations the necessary limits which are
1
2
CHARACTERISTICS OF COMPANY UNIONS
imposed by business conditions to the fulfillment of the workers’
demands.
This is the basis of the reasoning of those who urge the substitution
of company unions for national trade-unions. But though this
has become the theoretical foundation of company unions, the move
ment did not originate in this neatly reasoned fashion. Historically
it developed in response to several needs. One of these was a growing
demand that something should be done to provide in large-scale
industry a substitute for the immediate personal contact between
worker and employer which existed in the days of small establish
ments. Employers felt the need of some machinery for the adjust
ment of grievances and complaints and for collective discussion about
work and working conditions. Some adopted the company union,
believing this provided the avenue for better understanding between
management and employees, which would bring benefits not only
to the workers but also to the employer in improved morale.
Another important factor contributing toward the movement was
the insistent demand of workers for collective bargaining through
trade-unions, and the employers’ growing recognition that this demand
must either be met or a substitute found for it. In the opinion of many
employers the company union offered a desirable means for group
dealing, without the other characteristics of trade-unions which they
considered onerous.
Those who oppose the company union hold that power in the hands
of one interested group is held in check only by opposing power. Com
pany unions, they contend, do not permit the exercise of labor’s
economic power. Furthermore, in the absence of an American labor
party, such isolated, unaffiliated organizations are not able to exercise
that coherent pressure necessary to enlist the power of the state in
labor’s behalf.
At the present time there are three distinct methods of employeremployee dealing. The first is that of individual dealing, under which
the employer personally, or through his foreman or personnel director,
negotiates with his employees individually. The employer may
occasionally call a meeting of his employees to make an announcement
or for purposes of general discussion. A temporary workers’ committee
may sometimes be appointed to act upon a particular matter. Essen
tially, however, relations between the employer and the employee
remain on an individual basis, since there is no permanent or formal
organization of workers with duly constituted representatives to carry
on negotiations. Even where other types of dealing exist, individual
dealing is usually present, although it becomes difficult to measure its
extent or assess its significance.
The second type of employer-employee relationship is that associ
ated with negotiations with a trade-union. Individual grievances and
INTRODUCTION
3
the detailed interpretation and application of agreements are some
times handled through shop committees, but broad questions of wages,
hours, and working conditions usually are negotiated through repre
sentatives or agents of the trade-union who need not necessarily be
employees of the establishment or company.
The third type is that in which dealings are through a company
union. The term “ company union” is here used to mean an organiza
tion confined to workers of a particular company or plant,1 which has
for its purpose the consideration of conditions of employment. When
this method of handling labor matters was carried on by informal
committees, the whole arrangement was commonly referred to as an
“ employee-representation plan.” The term “ plan” is hardly suitable,
however, in cases where more formal procedure has developed, such as
written constitutions, elections, membership meetings, provisions for
arbitration, written agreements, and dues. Sometimes this type of
employer-employee dealing is called employee association, joint
conference, works council, industrial democracy, employee repre
sentation, good-will plan, joint conference committee, industrial
council, cooperative association, or shop committee.
Some object to the term “ company union” because of the possible
implication that the term means company domination. Others,
however, favor the term because it clearly describes the membership
coverage and because they like the implication of a unity of interest
between company and workers. The Bureau has accepted the term
“ company union” , using it in its generic sense, as an organization of
workers confined to a particular plant or company and having for its
purpose the representation of employees in their dealings with manage
ment.
The reader will find marked differences among the various company
unions described in this study. This diversity fits into the historical
background (see pt. I) which describes the various purposes and
objectives for which company unions were established. That this
diversity of purpose still remains is evident also in the analysis of the
specifically expressed objectives of the 126 company unions studied
(ch. IX ). Almost all of these company unions set themselves more
than a single objective. Each of them, however, professed to be the
representative agency for the workers in the company, plant, or other
unit covered.
The quantitative analysis in part II indicates that relatively few
existing company unions were started during the depression period.
It reveals the resurgence and tremendous growth of the company
union movement in the period after the passage of the N. I. It. A.,
when growth also occurred among trade-unions. In chapter VI the
1 T h ere are a few excep tio n s (su ch as th e L o y a l L egio n of L oggers an d L u m b e r m e n ), In w h ic h , o w in g to
pecu liar circu m stan ces, th e organ ization covers m ore th a n o n e p la n t or c o m p a n y .
4
CHARACTERISTICS OF COMPANY UNIONS
effect of three factors upon the organization of company unions is
shown— growing unionization, strikes, and an attempt to comply with
the requirements of section 7 (a) of the N. I. It. A. All of these
factors are essentially related to the problems of collective bargaining
and to the desire to find an alternative to trade-union bargaining.
At times the partisans of company unions have described them as
adjuncts of personnel management. But in the cases studied all were,
more or less consciously and explicitly, offered to the workers as an
alternative either to dealing with the employer individually or through
a trade-union. It is therefore to their functioning as agencies rep
resenting the interests of the workers in such matters as wages, hours,
and fundamental working conditions that this study of company
unions is primarily directed.
Method and form of organization are of vital importance in the case
of associations that seek to represent the workers’ interests in col
lective bargaining. The analysis, therefore, starts with an attempt
to answer two questions: As professed representatives of the em
ployees, were they set up through the initiative of the employees?
(See ch. VII.) Does their presence flow from the freely expressed
wish of the employees? (See ch. V III.)
While all these agencies lay claim to being organizations representa
tive of the workers’ interest, certain of them in practice had an
extremely narrow field of operation. A majority of them, however,
engaged in such activities as the handling of individual grievances,
methods of rotating work, questions of health and safety (ch. X V II).
Many also took up such basic questions as wages and hours (ch.
X V III). Some engaged in benefit and welfare activities (ch. X IX ).
The conclusions drawn from the field study (pt. I l l ) lend con
creteness and definiteness to the results obtained from the mail
questionnaire (pt. II). For instance, the data on matters discussed
or negotiated by the 592 company unions reported in the mail study
take on color and meaning in terms of the analysis in chapters X V II
and X V III. The fact that nearly half of the company unions covered
by the mail questionnaire had provisions for arbitration acquires real
meaning only when read in connection with the case-study analysis of
arbitration in chapter X V I. The fact that the mail questionnaire
revealed that almost two-thirds of the company unions discussed gen
eral wage questions should be assessed in the light of what actually
constitutes wage negotiation as described in chapter X V III.
Thus the two phases of the study complement each other to give
both a quantitative and qualitative picture of the characteristics of
company unions.
PART I
Historical Background
5
Chapter I
Developments in Pre-War and War Periods
Only a few firms are known to have had company unions or em
ployee-representation plans prior to the beginning of the World War.1
Among the best known were Wm. Filene’s Sons Co., of Boston, Mass.
(1898); the Nernst Lamp Co., Pittsburgh, Pa. (1903); The American
Rolling Mill Co., Middletown, Ohio (1904); the Nelson Valve Co.,
Philadelphia, Pa. (1907). During 1913-14 the “ industrial democracy”
plan was introduced in a number of firms.2 In 1915 the “ Rockefeller
industrial representation plan” was introduced in the coal mines, and
a year later in the steel works of the Colorado Fuel & Iron Co.
Though several of these plans contain interesting individual features,
only two are selected for brief description: The Filene Cooperative
Association and the industrial representation plan of the Colorado
Fuel & Iron Co. Both are significant, the former because it is the
oldest and is still functioning, the latter because of the size and impor
tance of the company introducing it at that early date and because
of the circumstances under which it was started. Moreover, the
plans of these two companies have become the prototypes of the two
forms of employee representation now usually distinguished as the
“ employee committee” type and “ joint committee” type.3
The Filene Cooperative A ssociation .4— The Filene Cooperative Asso
ciation grew slowly and organically out of unpretentious beginnings.
The founder of the store, Mr. William Filene, used to meet informally
with his employees and encourage them to express their ideas on all
aspects of the work and management of the store. In 1903 a regular
constitution and bylaws were drawn up, which have since been
amended several times.
The constitution invests the legislative power in the association,
to which every employee belongs by virtue of his employment in the
store. Among its powers are:
To initiate new store rules or modifications or cancelations of existing store rules
concerning store discipline, working conditions * * * or any other matters
1 S ee T h e S h o p C o m m itte e in th e U n ite d S ta tes, b y C arroll F ren ch , J o h n s H o p k in s, 1923; W o rk m en ’s
R ep resen ta tio n in In d u str ia l G o v ern m en t, b y E a rl J. M iller, U n iv e r sity of Illin o is, 1924; E m p lo y e e R ep re
sen ta tio n , b y E . R . B u r to n , B a ltim o re, 1926; W ork s C o u n cils in th e U n ite d S ta tes, N a tio n a l In d u stria l
C onference B o a rd , N e w Y o rk , 1919; T h e P h ila d e lp h ia R a p id T r a n sit P la n , b y J. J. W . C ask ie, A n n a ls of
th e A m erican A c a d e m y o f P o litica l a n d Social S cien ce, v o l. 85, P h ila d elp h ia , 1919.
2L eitch , J.: M a n to M a n , N e w Y o rk , 1919; C arp en ter, O. F .: F ro m P o litica l to In d u stria l G o v ern m en t,
in J. R . C o m m o n s’ In d u stria l G o v ern m en t, N e w Y ork , 1921.
3 See p p . 130-131.
4L a D a m e , M a ry : T h e F ilen e Store, A S tu d y o f E m p lo y e e s’ R ela tio n to M a n a g em en t in a R e ta il Store.
In d u stria l R ela tio n s Series. R u ssell Sage F o u n d a tio n , N e w Y ork , 1930.
7
8
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
except policies of the business; either by two-thirds of its entire membership or by
a five-sixths vote of the Filene Cooperative Association Council.5
This vote is subject to veto by management, but the veto may be
overruled by two-thirds of the entire membership of the association
after the matter has been discussed at one or more mass meetings held
within 10 days of the management’s veto. The judicial power of the
association is vested in an arbitration board composed of 12 members,
elected by and from the employees. The arbitration board has—
Final jurisdiction over grievances or disputes, including such questions as wages,
discharges, and working conditions between an F. C. A. member and the manage
ment, * * * or in any case in which any member of the F. C. A. has reason to
question the justice of any decision of a superior * * *.6
For a time the Filene Cooperative Association also had the privilege
of nominating 4 of the 11 directors of the corporation, but this was
later abolished by the management. The cost of operation of the
association is borne by the firm; occasional attempts to introduce
membership fees have been rejected by the employees.
Of special interest is the manner in which the trade-union issue was
once handled. Of the Filene sales force, which constitutes the
majority of the employees, none appears to have been a member of the
Retail Clerks’ International Protective Association when the Filene
association was established.7 To the union’s occasional attempts to
organize the Filene employees, the management offered no resistance.
For those occupations, however, which were strongly organized in
Boston, the management always employed union labor although it
had no written agreements with the trade-unions.8
An interesting issue developed out of this arrangement. Em
ployees began to insist that trade-union men, who enjoyed certain
extra privileges as to wages, hours, and overtime, should not also
be entitled to all association privileges because “ at present our policy
almost puts a premium upon union affiliations.” 9 The union tailors
thereupon, figuring that they would retain their union wages any
how, offered to resign from the trade-union rather than lose their
store privileges. In a conference arranged with the business agent
of the trade-union and the tailors, the vice president of the company,
to the happy surprise of the business agent, advised the men to pay
their back dues and remain loyal trade-union members. Since then,
employees who belong to trade-unions have also been members of
the Filene Cooperative Association.10
8 L a D a m e , M a ry : T h e F ilen e Store, A S tu d y o f E m p lo y e e s’ R ela tio n to M a n a g em en t in a R e ta il Store.
In d u str ia l rela tio n s series. R u sse ll Sage F o u n d a tio n , N e w Y ork , 1930, p . 122.
• Id e m , p . 123.
1 1d em , p . 87.
8Id e m , p . 89.
9 Id e m , p . 134, q u o ted from th e m in u te s o f a jo in t m e etin g , J u n e 2,1913.
10Id e m , p . 137.
D E V E L O P M E N T S IN P R E -W A R A N D W A R P E R IO D S
9
The Industrial Representation Plan of the Colorado Fuel & Iron
Co.n— This plan was introduced in the wake of one of the bitterest
industrial conflicts in the history of the country, the coal miners,
strike in Colorado, September 1913 to December 1914.12 The princi
pal demand of the miners had been recognition of the United Mine
Workers of America, a demand uncompromisingly rejected by the
operators.
Though never yielding on the strike issue as such, both owners
and management realized that something drastic had to be done to
improve conditions in the mines, and conciliate the embittered
miners as well as an aroused public opinion. The initiative seems
to have come from John D. Rockefeller, Jr., the principal stockholder
in the company. While the strike was still in progress, he wrote
to Mackenzie King, former Minister of Labor and later Premier of
Canada, asking his advice for developing—
* * * some organization in the mining camps which will assure to the employees
the opportunity for collective bargaining, for easy and constant conference with
reference to any matters of difference or grievance which may come up, and any
other advantages which may be derived from membership in the union.13
In his answer Mr. King recommended that—
A board on which both employers and employed are represented, and before
which, at stated intervals, questions affecting conditions of employment can be
discussed and grievances examined, would appear to constitute the necessary
basis of such machinery.13
The president of the company agreed to the scheme, and a plan was
worked out in accordance with a draft by Mr. King. A month after
the end of the strike it was explained to the miners, and in October
1915 it was adopted by an affirmative vote of 84 percent of the ballots
cast, about 57 percent of the miners voting.14
The plan provided for district joint conferences consisting of an
equal number of representatives of the employees and of management.
The former were elected annually by secret ballot by and from the
employees, the latter were appointed by management. The con
ferences met every 4 months for the discussion of matters of mutual
interest. These conferences also selected standing district joint
committees on cooperation, conciliation, and wages; safety and acci
dents; sanitation, health and housing; and recreation and education.
In the case of a grievance, a procedure was provided under which the
u See S elek m an an d V a n K leeck , E m p lo y e s’ R ep resen tation in C oal M in e s, A S tu d y of th e In d u str ia l
R ep resen tation P la n o f th e C olorado F u el & Iron C o., R u ssell Sage F o u n d a tio n , N e w Y ork , 1924.
12U . S . C om m issio n o n In d u str ia l R e la tio n s, F in a l R ep o rt a n d T e stim o n y , v o ls. V I, V I I I , I X . W a sh
in g to n , 1916; C o n d itio n s in th e C oal M in e s o f C olorado, H ea rin g s before a S u b co m m ittee o f th e C o m m itte e
o n M in e s an d M in in g , H o u se o f R e p resen ta tiv es, 63d C on g ., 1st sess., v o ls. I a n d II.
13U . S. C o m m issio n o n In d u stria l R ela tio n s. R ep ort o n th e C olorado C oal S trik e. W a sh in g to n , 1915,
p p . 158-166.
14 S elek m an an d V an K leeck p. 27.
154 8 7 5°— 38--------2
10
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
employee or his representative could take the case through various
stages to the president of the company. If not satisfactorily settled
by the officials of the company, the grievance might be presented to
the district joint committee on cooperation, conciliation, and wages.
The decision of a majority of this committee was binding upon both
parties. If the committee could not reach a satisfactory agreement,
it could either choose an impartial umpire to sit with them and cast
the deciding vote; or it could, if the parties agreed, be referred to
arbitration by an outside person or persons or by the industrial com
mission of Colorado. In practice, grievances and complaints were
handled by the district joint committees without having gone through
the long series of appeals from official to official.
Of interest again is the relation of this plan to the trade-union, the
United Mine Workers. The agreement which established the plan
provided that there should be no discrimination against employees
because of membership in the trade-union,15 and that wages should
increase proportionately with those in competitive districts.16 After
the introduction of the plan, according to disinterested observers,
there were considerable improvements in housing, sanitation, safety,
recreational facilities, and job security, the joint committees doing
away with much of the arbitrary firing by foremen. Trade-union
organizers were permitted to enter the mines, and employees were not
discharged for joining the trade-union. “ Competitors’ wages” were
almost without exception trade-union rates.
In 7 years of operation of employees’ representation the company tried only
once to determine wages by independent action in its own mines, establishing a
rate lower than that paid in union mines. Its employees struck and less than a
year later, following a nation-wide strike of miners, the union rate was again restored
in Colorado. Every other change in wages in these 7 years followed changes in
union mines.17
Notwithstanding, the trade-union continued its resistance toward
the plan. Finally the biennial district conventions in 1918 and in 1920
forbade union miners to take any part in the plan.18
The War Period
The great impetus to the works council movement in the United
States came during the war. In the majority of cases their introduc
tion during this period was not voluntary on the part of the employers.
They grew up as a result of a policy imposed upon them by the several
governmental labor boards, the most important of which were the
Shipbuilding Labor Adjustment Board and the National War Labor
Board.
18 Id e m , p . 408.
16Id e m , p . 416.
v
Id em , p . 265.
18Sec. 12 of C o n stitu tio n of D istr ic t N o . 15, U n ite d M in e W ork ers of A m erica, e ffectiv e A p r. 1,1920, p . 33.
D E V E L O P M E N T S IN P R E -W A R A N D W A R P E R IO D S
11
Labor difficulties had arisen in direct consequence of the sudden
enormous demand for labor in various war industries in the face of a
labor supply decreased by the draft and reduced immigration. With
no centralized machinery available for directing the labor supply or
enforcing a balanced wage policy, an unrestrained competitive bidding
for labor had set in, leading to great inequality and instability of
wage rates. This caused an unprecedented labor turn-over.19 More
over, rapidly rising living costs led workers to demand higher wages.
With a scarcity of labor, trade-unions found it feasible to strike in
order to get wage increases. The number of strikes rose from 1,204
in 1914 to 4,450 in 1917,20 and in many instances threatened to cripple
essential war industries.21
The Shipbuilding Labor Adjustment Board was organized in
December 1917. It consisted of one representative of the shipbuilding
industry, one representative of organized labor, nominated by Samuel
Gompers, president of the American Federation of Labor, and one
nonpartisan member. The National War Labor Board began to
function in April 1918. It consisted of five members representing
industry and railroads, five representing organized labor, nominated
by the American Federation of Labor, and two nonpartisan members.
The composition of these boards, including both employers and
labor unions, implied that their policy was to be a compromise—in
the name of the national emergency— between the interests of both
groups. This was clearly expressed in the “ Principles and policies
to govern the relations between workers and employers in war indus
tries for the duration of the war” , under which the boards functioned:
There should be no strikes or lock-outs during the war.
Right to organize.— 1. The right of workers to organize in trade-unions and to
bargain collectively, through chosen representatives, is recognized and affirmed.
This right shall not be denied, abridged, or interfered with by the employers in
any manner whatsoever.
2. The right of employers to organize in associations or groups and to bargain
collectively, through chosen representatives, is recognized and affirmed. This
right shall not be denied, abridged, or interfered with by the workers in any
manner whatsoever.
3. Employers should not discharge workers for membership in trade-unions, nor
for legitimate trade-union activities.
The workers, in the exercise of their right to organize, shall not use coercive
measures of any kind to induce persons to join their organization, nor to induce
employers to bargain or deal therewith.
Existing conditions.— 1. In establishments where the union shop exists the same
shall continue, and the union standards as to wages, hours of labor, and other
conditions of employment shall be maintained.
19 T w o field in v e stig a tio n s m a d e b y th e B u reau o f L abor S ta tistic s in d ic a te th a t th e sep ara tio n rate w a s
tw ic e as h ig h in 1917-18 a s in 1913-14. In th e earlier p eriod , th e rate w as 3.3 p er 10,000 lab or h ou rs a n d in
1917-18 it w a s 6.7. M o n th ly L a b or R e v ie w , J u n e 1920, p . 41.
20M o n th ly L a b or R e v ie w , A p ril 1916, p . 13; J u ly 1929, p . 133.
21In th e su m m e r a n d fall o f 1917, cop p er m in in g in A rizon a, oil p ro d u ctio n in C alifornia, th e lu m b er
in d u stries in th e N o r th w e st, an d m e a t p a ck in g in C h icago w ere m o st serio u sly affected b y p rolon ged strik es.
12
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
2.
In establishments where union and nonunion men and women work together,
and the employer meets only with employees or representatives engaged in said
establishments, the continuance of such conditions shall not be deemed a grievance.
This declaration, however, is not intended in any manner to deny the right, or
discourage the practice of the formation of labor unions, or the joining of the same
by the workers in said establishments, * * *.22
The almost complete absence of machinery for conciliation and
arbitration between workers and management within individual es
tablishments had been found to be one of the chief obstacles to the
speedy and peaceful settlement of disputes.23 Hence, one of the tasks
of the National War Labor Board and the Shipbuilding Labor Adjust
ment Board was to establish such machinery. In accordance with
the Board’s principles, this was to be done without prejudice to ex
isting or nonexisting union relations.
It was here that the “ works council” or “ shop committee” idea
presented itself as, at least, a temporary solution. The idea was
given additional support by the alleged success of some of the earlier
employee-representation plans in the United States and by the
“ Whitley councils” which were at that time being organized in Great
Britain and widely discussed in the United States.24 Accordingly,
many of the awards of the governmental labor boards stipulated,
among other measures, the organization of shop committees for the
purpose of settling disputes and adjusting grievances.25
Types of shop committees .— The standard procedure followed by the
National War Labor Board in setting up shop committees was to
provide for the election, by majority vote, of 1 committeeman for
every 100 employees or major fraction thereof. The election, which
was supervised by the Board’s examiner, was by secret ballot, and
foremen and other officials of the company were required to absent
themselves.
The Board installed its first shop committee in July 1918 in the
General Electric plant at Pittsfield, Mass.26 The plan provided for a
department committee to adjust disputes which the employees and
the supervisory officials were unable to adjust, and a committee on
appeals, composed of three employees, to take up with management
disputes which the department committees failed to adjust.
One of the most elaborate plans, that set up for establishments in
Bridgeport, Conn.,27provided for plants being divided into departments,
22R ep ort o f W ar L abor C onference B o ard to th e S ecretary of L abor, M a rch 29, 1918, p rin ted in U . S.
B u rea u o f L ab or S ta tistic s B u ll. N o . 287: N a tio n a l W ar L ab or B oard , p . 31.
23U . S. P re sid e n t's M e d ia tio n C om m issio n . R ep o rt. W a sh in g to n , 1918, p p . 18 an d 20.
24S ee p . 16 for a d iscu ssio n o f th e W h itle y cou n cils.
35 A to ta l o f 226 o f th e B o a rd ’s a w a rd s p ro v id ed for co llectiv e b argaining w ith e m p lo y ee s eith er th ro u gh
u n io n s in th o se sh o p s w h ic h h a d b een org an ized before th e e sta b lish m e n t o f th e B o ard , or th ro u g h sh o p or
d e p a r tm en ta l c o m m itte e s in sh o p s w h ic h h a d n o t p r e v io u sly b een organized. (U . S. D e p a r tm e n t o f L ab or.
B u rea u o f L ab or S ta tistic s. B u ll. N o . 287: N a tio n a l W ar L ab or B oard . W a sh in g to n , 1922, p . 23.)
26N a tio n a l W ar L ab or B o a rd , D o c k e t N o . 19.
27O rgan ization a n d B y la w s for C o lle c tiv e B a rg ain in g C o m m ittees In stitu te d b y th e N a tio n a l W ar L abor
B o a r d for B rid gep o rt, C on n , N a tio n a l W ar L abor B o ard , D o c k e t N o . 132.
D E V E L O P M E N T S IN P R E -W A R A N D W A R P E R IO D S
13
each represented by a committee of three members, elected for a 1-year
term from among employees who had actually worked in the depart
ment for at least 3 months immediately preceding the election. The
chairmen of the different department committees constituted an
employees’ general committee. If the general committee was too
large, provision was made for selecting from among its members a
smaller employees’ executive committee to which functions and duties
of the general committee were to be delegated.
The department committees were to handle all individual griev
ances but were not to have—
executive or veto powers, such as the right to decide who shall or shall not be em
ployed, who shall or shall not be discharged, who shall or shall not receive an
increase in wage, how a certain operation shall or shall not be performed, etc.
The general committees were empowered to adjust with manage
ment cases referred to them by the department committees. They
were also given the right “ to initiate and discuss in a joint conference
any matter appertaining to the plant as a whole.”
The procedure, as outlined in the plan, specified that employees
were to present their cases in writing to the chairman of the department
committee. If the department committee, by majority vote, con
sidered the case to be meritorious, the matter went to a joint depart
ment committee with management representatives. A majority of
two votes of the entire membership of the joint committee, that is,
five votes out of a joint committee of six, settled the issue beyond appeal.
If this majority was not obtained, the question was referred to the
joint general or executive committee, where the same majority could
settle the matter. Failing such agreement, the plan provided that—
before other action shall be taken, said committee shah refer the matter in question
to the highest executives of the plant management for consideration and recom
mendation.
The bylaws provided for the recall of committeemen by a twothirds vote of the actual employees of the department involved. The
bylaws might be amended by a two-thirds vote at a joint conference
of the general committee and the management.
The National War Labor Board adapted the details of its plans to
the varying conditions found in different plants. In some plants
certain features were added. Thus the Bethlehem plan28 provided
for arbitration by consent of the parties concerned in those cases
where the management and committee could come to no agreement.
To qualify for election as committeeman, an employee was required
not only to be on the company’s pay roll for a period of 4 months prior
to nomination but also to be an American citizen, or have taken out
first papers, and to be 21 years of age or over. The Bethlehem plan
also authorized the general committee to designate subcommittees
28 N a tio n a l W ar L ab or B o ard , D o c k e t N o . 22.
14
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
from among its own number “ to take up the matters of wage scale and
working conditions, or any other matters that it may deem necessary
to submit to the management for its consideration.” Also when
reductions in working force appeared probable, the examiner in charge
issued the following ruling to protect committeemen against dis
crimination:
* * * The committeemen under the award of the National War Labor
Board * * * cannot be laid off without violation of award except for just
and valid cause relating to the conduct or operation of business and then only
in proportion to the lay-off of employees in the shop affected. * * * 100
employees must have been laid off * * * before a committeeman may be
laid off * * * 29
The functions and duties of committees varied. In some cases they
were authorized to deal only with wage scales; in other cases with
wages and other conditions of employment including provisions for
the health, comfort, and working efficiency of the workers. Some
awards instituted committees for the purpose of administering the
award and determining the application and interpretation of the
award.30
The Four L plan .— A further type of organization, unique both
as to origin and form, came into being somewhat earlier than the
one discussed above. This was the Loyal Legion of Loggers and
Lumbermen, first organized in November 1917.31 In the summer
of 1917, there was an almost complete break-down of production in
the lumber industry in the Northwest in the face of most urgent war
needs of lumber for shipbuilding, airplanes, and cantonment con
struction. Back of the strikes and sabotage which caused the break
down was the thorough dissatisfaction of the lumber workers with
their working conditions, namely, the 10-hour day, overcrowded living
accommodations in the lumber camps, and lack of recreational and
educational facilities. Lumber strikes multiplied, their number
rising from 44 in 1916 to 299 in 1917.32 The demands eventually
concentrated on the 8-hour day which the employers refused to grant
in spite of appeals by the Secretary of War, the Governor of the
State of Washington, and the President’s Mediation Commission.
Organized in the Lumbermen’s Protective Association the employers
even pledged themselves to discriminate against any member who
would grant the 8-hour day. The strikes were unsuccessful, but
29 N a tio n a l W ar L a b or B o ard , D o c k e t N o . 22, R u lin g N o . 2 (N o v . 22, 1918).
30U . S . D e p a r tm e n t of L ab or. B u rea u o f L ab or S ta tistics. B u ll. N o . 287: N a tio n a l W ar L a b or B o ard ,
W a sh in g to n , 1922. S ee p p . 61 ff. for a su m m a ry o f th e m a tte r s h a n d led b y d ifferen t sh o p c o m m itte e s.
si U . S. D e p a r tm e n t o f L ab or. B u rea u o f L a b or S ta tistic s. B u ll. N o . 349: In d u str ia l r ela tio n s in th e
W e st C o a st lu m b er in d u str y , W a sh in g to n , 1924; Jo u rn al o f P o litic a l E c o n o m y , U n iv e r sity o f C h icago
P ress, J u n e 1923, p p . 313-341, T h e L o y a l L eg io n o f L oggers a n d L u m b erm en , b y E . M itte lm a n ; B in g , A .:
W artim e S trik es a n d T h e ir A d ju stm e n t, N e w Y ork , 1921, p p . 255-272.
32 M o n th ly L ab or R e v ie w , J u ly 1929, p . 139.
D E V E L O P M E N T S IN P R E -W A R A N D W A R P E R IO D S
lumber production remained at low ebb— sabotage, or “ the strike on
the job ” , taking the place of the open strike.33
In November 1917 the War Department sent Col. Brice F. Disque,
of the Aircraft Production Board, as head of the Spruce Production
Division, into the lumber district to restore production. This he did
by getting employers and workers together into one patriotic organ
ization, the Loyal Legion of Loggers and Lumbermen. Each member,
on joining, signed a pledge of loyalty to the country and promised
to “ * * * stamp out any sedition or acts of hostility against the
United States Government * *
Membership grew rapidly,
reaching over 100,000 during the first year. Soldiers and officers of
the Spruce Production Division were freely used in the process of re
cruiting members. The legion was eminently successful in quickly re
moving most of the principal causes of discontent. In the spring of
1918 the basic 8-hour day was granted; uniform wage scales were intro
duced ; sanitary camps were built with reading rooms, motion-picture
houses, and convention halls; and athletic activities were organized.
Strikes decreased from 299 in 1917 to 76 in 1918,34 and complaints of
sabotage disappeared.
The organization of the Four L extended over the States of Oregon,
Washington, and Idaho (later it spread also into the East) and con
sisted of joint local committees elected in the camps and mills, repre
sentatives of which met in joint district councils, these again sending
delegates to the central council with headquarters in Portland, Oreg.
This form of organization was unique. Unlike the usual works
council, it comprised a great number of establishments and different
companies in several States. Unlike the usual trade or industrial
union, it united in its fold both workers and employers. For these
reasons, it was the closest analogy— though still a fairly remote one—
to the British Whitley councils.
Voluntary plans .— During this period of compulsory introduction
of shop committees, a number of firms voluntarily introduced employee
representation plans. Notable among them was the Standard Oil
Co. (New Jersey), Standard Oil Co. (Indiana), Procter and Gamble,
International Harvester Co., and Bethlehem Steel Corporation, in its
plants not affected by the award of the War Labor Board. The plan
of the Standard Oil Co. was essentially similar to the Colorado Fuel
& Iron Co. plan, and typical of a great number of others. It provided
joint departmental committees, joint general councils, and joint
permanent special committees, each of these consisting of elected
33 O n e rep ort sta tes th a t a t a ca m p w h ere th e n orm al p rod u ction w a s 50 cars o f lo g s p er d a y , d e m a n d s (b y
th e w orkers) w ere p resen ted an d refu sed . Im m e d ia te ly th e o u tp u t b eg a n to fall off. E ach d a y ’s p ro d u ctio n
w a s fiv e cars le ss th a n th e d a y before. T h e d e m a n d s w ere fin a lly g ra n ted w h e n o u tp u t rea ch ed b u t fiv e
cars p er d a y . (U . S . B u rea u o f L ab or S ta tistic s, B u ll. N o . 349, p . 75.)
34M o n th ly L ab or R e v ie w , J u ly 1929, p . 139.
16
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
representatives of the workers and an equal number of representatives
appointed by the management. Connected with this representation
plan were also plans for stock acquisition by employees and insurance
and pension plans.
The W h itley councils and their relation to A m erican works councils .—
The Whitley councils of Great Britain35 were a form of industrial
organization planned during the war by a committee named after its
chairman, J. R. Whitley, M. P. The committee was organized in 1916
as a “ subcommittee on relations between employers and employed” of
the British Government’s Reconstruction Committee, and consisted
of representatives of employers and of organized labor, and two econo
mists. In March 1917 the committee reported a plan for a compre
hensive democratic organization of British industry, which provided
for: (a) Joint national industrial councils formed by trade-unions and
employers’ organizations to consider and make agreements concerning
the industry as a whole; (6) joint district industrial councils; (c) works
committees to deal with purely individual and shop problems, and to
supervise the carrying out of the agreements made by the national
and district councils.
The analogy between the British Whitley councils and the American
works councils of the war period lay chiefly in the fact that in both
instances Government-appointed joint groups of employers’ and
labor’s representatives recommended machinery for closer cooperation
between workers and employers as a means of advancing industrial
peace, and in both instances works councils were formed. But here
the analogy ended. In the British plan the works committees were
merely the first unit in a nation-wide organization of the whole
industry, based on trade-unionism and collective bargaining, with
trade-unionism as one of its cornerstones. In the United States the
individual works council was the whole plan. With the one exception
of the Four L, there was no integration of individual works councils
into greater geographical units. Moreover, the works councils in
this country were, in their very inception, divorced from tradeunionism.
Attitude of em ployers toward the plans. —By the end of the war,
employee-representation plans had thus become a rather widely
adopted and much discussed form of industrial organization in the
United States. The attitude of employers at this time, according to
individual testimony, was uncertain and watchful.36 Some em
ployers regarded works councils as a “ revolutionary step” ; some were
38W olfe, A . B ., W ork s C o m m ittees an d J o in t In d u stria l C ou n cils, U . S. S h ip p in g B oard E m e r g e n c y F lee t
C orp oration , In d u stria l R e la tio n s D iv isio n , P h ila d elp h ia , 1919; U . S . D e p a r tm e n t o f L ab or, B u rea u of
L a b or S ta tistic s, B u ll. N o . 255: J o in t in d u stria l co u n cils in G reat B r ita in , W a sh in g to n , 1919.
36 N a tio n a l In d u stria l C on feren ce B o ard , W ork s C o u n cils in th e U n ite d S ta tes, R esea rch R e p o r t N o . 21,
N e w Y o r k , O ctober 1919, p . 75 ff.; W olfe, A . B .: W ork s C o m m itte e s a n d J o in t In d u str ia l C o u n c ils, U . S.
S h ip p in g B oard E m erg en cy F le e t C orp oration , In d u str ia l R e la tio n s D iv isio n , P h ila d e lp h ia , 1919, p . 230 fiE.
D E V E L O P M E N T S IN P R E -W A R A N D W A R P E R IO D S
17
simply annoyed by them; some thought them superfluous; others
found them satisfactory as long as trade-unions did not get control
over them; the majority discovered this type of workers’ representa
tion more or less helpful in improving the morale and efficiency of
their labor force.
Attitude of labor.— In many instances, the requirement that em
ployee-representation plans be introduced was made in awards to
firms which were definitely opposed not only to labor unions, but to
any collective dealing with their own employees, as, for example, in
the cases of the Bethlehem Steel Corporation and the General Electric
Co. at Pittsfield, Mass. These companies, in spite of governmental
efforts at mediation, had repeatedly refused to meet with a committee
representing their employees.37
In such cases as these, where employers were coerced by the Gov
ernment to introduce collective dealing with their employees, organ
ized labor was inclined to regard such awards as a “ first step” toward
industrial democracy. Thus Mr. Gompers wrote on the occasion of
the Bethlehem award:
Through assistance from the outside the Bethlehem Steel workers may be
able to make their shop committee the nucleus of an industrial constitution that
will result in just as thorough an organization of that side of production in this
plant which concerns employees as has existed on the side of the management.
A shop committee for the Bethlehem steelworkers may mean the beginning of
industrial freedom.
The same benefits may be established for the workers in every other place
where a shop committee is inaugurated; nor, is it necessary to wait for an award
from the War Labor Board. Shop committees can be established through the
initiative of the workers themselves.38
The reverse situation developed where awards established shop
committees in industries with strong unions. This happened in a
number of cases under the jurisdiction of the Shipbuilding Labor
Adjustment Board.39 Shipyard workers had become strongly or
ganized during the war, and complaints by workers were often handled
through local trade-union officers. In such cases the employers were
anxious to have shop committees established to relieve themselves of
having to deal with outsiders. Union workers, for the same reason,
were opposed to their introduction. In such cases shop committees,
when established, frequently came completely under union control.
Some employers preferred to deal with them rather than with the
outside union agents.
Where shop committees were used as a substitute for and an
indirect weapon against the union, they were utterly to be condemned.
37 H ea rin g before C o m m itte e o n C laim s, H o u se of R ep resen ta tiv es, 67th C on g ., 2d sess., p. 22.
38 A m erican F ed era tio n ist. W a sh in g to n , S ep tem b er 1918, p . 810.
39 U . S. D e p a r tm e n t o f L ab or. B u reau o f L ab or S ta tistics. B u ll. N o . 283: H isto ry o f th e S h ip b u ild in g
L ab or A d ju stm e n t B o ard . W a sh in g to n , 1921, p p . 62 fl.
18
CHARACTERISTICS OF COMPANY UNIONS
The realization that this was the trend in many organizations was
given expression in a resolution adopted by the annual convention of
the American Federation of Labor of 1919:
In establishing wages, hours, and working conditions in their plant, employers
habitually use their great economic power to enforce their will. Therefore, to
secure just treatment, the only recourse of the workers is to develop a power
equally strong and to confront their employers with it. * * * In this vital
respect, the company union is a complete failure. With hardly a pretense of
organization, unaffiliated with other groups of workers in the same industry,
destitute of funds, and unfitted to use the strike weapon, it is totally unable to
force its will * * *.
Whereas, In view of the foregoing facts, it is evident that company unions are
unqualified to represent the interests of the workers, and that they are a delusion
and a snare * * *: Resolved, that we disapprove and condemn all such
company unions and advise our membership to have nothing to do with
them, * * *.40
40 A m erican F ed eration of L abor. R ep ort of P roceed in g s, T h ir ty -n in th A n n u al C o n v en tio n , 1919, p . 303.
Chapter II
Developments After the War Period
During the post-war period, the shop committee movement con
tinued to grow. Surveys made at intervals by the National Industrial
Conference Board 1 showed that the number of companies having
active works councils (later referred to as employee-representation
plans) rose from 145 in 1919 to 385 in 1922. According to this report
403,765 workers were covered by company unions in 1919, while
690,000 were covered in 1922. While some of the Governmentinitiated plans continued in original or modified form, many were
discarded.2 This was probably due to the fact that Governmentinitiated plans were primarily in war plants which closed or drastically
curtailed operations after the war. Furthermore, some employers
took advantage of the favorable opportunity presented by the depres
sion to dispose of the plans which had been forced upon them. Despite
the discontinuance of many individual plans, in the face of the dis
appearance of war conditions, and depression and unemployment,
with trade-union membership plunging precipitously from its wartime
high of 5,047,800 in 1920 to 3,622,000 in 1923,3 the works council
movement continued to grow, though at a considerably slower rate
than during the war.
That works councils were useful in promoting cooperation between
workers and management had, of course, been the very reason for
introducing them during the war. For employers to continue shop
committees when labor was plentiful was an expression of the new
business philosophy— not new in itself but new in terms of its wide
acceptance by businessmen. This new philosophy of “ personnel
management” was based on the principle that the good will and
cooperative spirit of the workers is a valuable asset, so much so
1 N a tio n a l In d u str ia l C on feren ce B o ard . C o lle c tiv e B a rg ain in g T h ro u g h E m p lo y e e R ep resen ta tio n .
N e w Y o r k , 1933, ta b le 1, p . 16. O th er su r v e y s b y th e N a tio n a l I n d u str ia l C on feren ce B o a rd g iv in g figu res
o n w o rk s c o u n c ils are: W o rk s C o u n c ils in th e U n ite d S ta tes, R esea rch rep o rt n o . 21, O ctob er 1919; E x p er i
e n ce w ith W o rk s C o u n c ils in th e U n ite d S ta te s, R esea rch rep o rt n o . 50, M a y 1922; T h e G ro w th o f W orks
C o u n cils in th e U n ite d S ta tes, a sta tistic a l su m m a r y , sp e c ia l rep o rt n o . 32, 1925.
T h e r e se e m s t o b e so m e v a r ia tio n in th e figu res q u o te d in th e d iffe r en t rep orts o f th e N a tio n a l In d u stria l
C on feren ce B o a rd for c e r ta in sp ecified tim e s. T h e a b o v e figures as w e ll as N a tio n a l In d u str ia l C on feren ce
B o ard figures q u o te d i n th e fo llo w in g p a g es are ta k e n from th eir 1933 rep ort o n th e a ssu m p tio n th a t th e
la te st rep o rt in c lu d e s th e m o st r elia b le d a ta .
2 T h u s o n ly 1 o f th e 126 c o m p a n y u n io n s cov ered in th e B u reau o f L ab or S ta tistic s’ field stu d y in 1935
w a s a d irect d e v e lo p m e n t o f a p la n in stitu te d b y th e W ar L abor B o ard . (S ee ta b le 29, p . 86.)
3 W o lm a n , L eo: E b b an d F lo w in T ra d e U n io n ism . N a tio n a l B u rea u o f E c o n o m ic R esearch . N e w
Y ork , 1936, p . 16.
19
20
CHARACTERISTICS OF COMPANY UNIONS
that it is worth the sacrifice of some of the prerogatives of management;
that workers, when given a share in the management of their own
affairs, work better, remain longer, are not as liable to go out on
strike, and are less prone to seek trade-union aid.
This last point was of special importance, since it played a prominent
part in the development of shop committees during the war, when
trade-unions were flourishing as never before. Protected by the
“ principles” of the National War Labor Board guaranteeing the
workers’ right to organize, trade-unions penetrated into many previ
ously “ impregnable” industries, notably the railroad shops, the meat
packing and textile industries. This was resented by many employers
who had not changed their attitude toward recognition of tradeunions. Yet the return to a purely individual basis of bargaining was
likely to antagonize the workers who had come to appreciate the value
of organization. The alternative offered was collective dealing, not
through trade-unions but through company unions. The policy of
refusing to recognize trade-unions and substituting company unions as
the machinery for collective dealing is well illustrated in the shop
crafts of the railroads.4 Between July and October 1922, in the course
of a strike of these crafts, 16 roads, covering nearly one-fourth of
the total mileage of the country, formed company unions for their
shopmen.5
Other prominent cases of overcoming unionization through company
unions were those of the meat packers in Chicago and of the Pullman
Co. In 1917 the meat packers refused to bargain with the newly
formed Stockyard Labor Council, an industrial federation of local craft
unions affiliated with the American Federation of Labor. After pro
longed strikes and outside arbitration, the companies in August 1921
introduced company unions.6 In the case of the Pullman Co., the
sleeping-car conductors had built up their organization, which was
affiliated with the American Federation of Labor, and succeeded in
gaining recognition in 1920. As far as the Pullman porters were con
cerned, however, the company organized an employee-representation
plan in 1920 and, according to testimony given the Federal Coordinator
of Transportation, pursued a policy of sharp discrimination against
employees belonging to the Brotherhood of Sleeping Car Porters.7
4
S ee a p p en d ix I, p . 220, for a n acco u n t of th e P e n n sy lv a n ia R ailroa d situ a tio n . S ee D e cisio n s o f th e R a il
ro a d L a b or B o a rd , v o l. IV , d ecisio n 1829; also S ten o grap h ic T ran scrip t of H ea rin g s before th e R ailroad
L a b or B o a rd , D o c k e t 404; S ocial S cien ce R esea rch C o u n c il, R a ilw a y L a b or S u r v e y , N e w Y o rk , 1933;
W olf, H a r ry D .: T h e R ailroa d L ab or B o ard , U n iv e r sity of C h icago P ress, 1927, p p . 295-329; E x p erien ce o f
th e P en n sy lv a n ia R ailroa d S y ste m w ith E m p lo y e e R e p resen ta tio n , C o n v en tio n A d d resses, N a tio n a l
P erso n n el A sso cia tio n , N e w Y ork , 1922.
6 S ocial S cien ce R esea rch C o u n cil. R a ilw a y L ab or S u r v e y . N e w Y ork , 1933, p . 41.
6 O n lab or co n d itio n s o f sto ck y a rd w ork ers, see U . S . C om m issio n o n In d u stria l R e la tio n s, F in a l R ep o rt
an d T e stim o n y , v o l. IV , W a sh in g to n , 1916, p p . 3459-3531; U . S. P re sid e n t’s M e d ia tio n C o m m issio n ’s R ep o rt,
J a n . 1, 1918, W a sh in g to n , 1918, p p . 15-17. O n J u d g e A lsh u ler’s aw ard , see M o n th ly L ab or R e v ie w , M a y
1918, p p . 115-127; also A rm o u r & C o ., C h icago [yearb ook ], 1922.
7 O n lab or co n d itio n s a m o n g P u llm a n p orters, se e U . S . C o m m issio n on In d u stria l R e la tio n s, F in a l
R ep o rt a n d T e stim o n y , v o l. 10, W a sh in g to n , 1916, p p . 9543-9695; also, B r o t h e r h o o d o f S l e e p i n g C a r P o r t e r s
v . P u l l m a n C o . , p e titio n to th e F ed eral C oord in ator o f T ran sp orta tio n .
DEVELOPMENTS AFTER THE WAR PERIOD
21
The Personnel Period, 1923-29
The period from 1923 to 1929 was one of industrial expansion and
comparative industrial peace.8 It was characterized by a growing
and increasingly articulate emphasis on the importance of the human
factor in industry. The preceding decade of “ scientific management”
had attacked the problem of increasing industrial efficiency primarily
from the point of view of the mechanical aspects of work. The
following decade turned its attention to the role of the human element
in industrial efficiency. This role may be analyzed into two distinct
aspects: (a) Efficiency resulting from the worker’s physical and mental
fitness for his task, which aspect led to the growing emphasis on such
things as job analysis, mental and physical tests for workers, etc.;
(b) efficiency resulting from the worker’s attitude toward his job,
usually characterized as the worker’s morale.
There were essentially three types of negative attitudes which,
from the point of view of personnel management, interfered with the
worker’s willingness to cooperate fully: (1) Discontent over wages
and hours; (2) irritation and hostility caused by specific acts, such as
dismissals, arbitrary promotions, wage discriminations, unfair checking
of piece work, abuse by superiors, etc.; (3) basic dissatisfaction with
the existing social set-up, resentment over the division of the profits of
industry— a frame of mind usually referred to as “ radicalism.”
While it was admitted that personnel management could do little
with respect to basic wages and hours, it was felt that many specific
resentments and much irritation could be alleviated. Moreover,
basic dissatisfaction with the economic order could, they believed,
be overcome by what was often referred to as “ education in the true
principles of economics.”
In addition to these endeavors to free the worker’s mind from nega
tive attitudes, a variety of positive policies were designed to make
him more secure and comfortable. On the financial side were such
schemes as stock purchasing or profit sharing, pension and insurance
plans; mutual-benefit plans providing for emergencies in case of illness,
accident, and death; credit facilities; savings plans; home-buying plans;
company stores; company cafeterias; and company houses. On the
social side were employees’ clubs, reading rooms, athletic activities,
dances, and the like; in short, all the manifold plans and policies
comprised under the term “ welfare activities.”
Employee-representation plans fitted into this personnel and welfare
program. Indeed, it was stated that they were “ an integral part of
any well-rounded personnel program.” For adjustment of grievances,
shop committees had, since their beginning, been regarded as of para
mount usefulness. Educational endeavors could readily be coordi8 T h e n u m b er o f strik es d ecreased from th e all-tim e h ig h of 4,450 in 1917 to 1,035 in 1926.
R e v ie w , J u ly 1929, p . 132.)
(M o n th ly L ab or
22
CHARACTERISTICS OF COMPANY UNIONS
nated with employee associations, and employee committees could
well be used in connection with the administration of welfare activities.
Placed in the hands of professionally trained personnel officers, the
organization and management of employee-representation plans
became an art and a science in itself. Principles and theories were
developed on how to introduce them so as to gain the workers' con
fidence and how to enlist their fullest cooperation and still maintain
discipline and control.
Employers’ associations.— With the wide adoption of employeerepresentation plans by individual employers it was only natural
that employers' associations should have likewise interested them
selves in the movement. Among the national associations most
prominent during this period was the National Industrial Conference
Board. Its frequent publications 9 not only gave prominence to the
movement but lent encouragement through their implication that
works councils were, or might be, useful from a business point of view.
The American Management Association likewise expressed its interest
in employee representation, notably in the form of addresses and
reports at its conventions and conferences. There was not entire
agreement among the spokesmen for these various organizations.
There could be heard at their conventions the views of the sponsor
of the Philadelphia Rapid Transit Co. plan, insisting that final
power of decision should rest with the joint committee, and referring
to the majority of existing representation plans as “ mere scenery or
atmosphere." 10 On the other hand there was ever present in these
discussions an effort to deprecate the power and influence of the
representation plans, assuring the listeners that they were “ in no
way a substitute for management",11 that “ management has not
abdicated its right to promulgate any orders or instructions or to
impose discipline in its best judgment",12 that employee represen
tation is not management-sharing, not representative government in
industry, not a labor organization for collective bargaining, but “ leader
ship through consultation." 13
9 See fo o tn ote 1, c h . II, p . 19.
19
D isc u ssio n o n a rep ort of th e c o m m itte e on e m p lo y ee coo p eration , a n n u a l co n v en tio n of th e A m erican
M a n a g e m e n t A sso cia tio n , 1923, C o m m itte e R ep o rt Series, 1924, N o . 3, p . 6.
11 A d d ress b y T . P . S y lv a n , v ic e p resid en t o f th e N e w Y ork T e le p h o n e C o ., A n n u a l C o n v en tio n Series,
A m erican M a n a g e m e n t A sso cia tio n , 1925, N o . 23, p . 6.
13 A d d ress b y E . L e e , v ic e p resid en t o f th e P e n n sy lv a n ia R ailroad , A n n u a l C o n v en tio n Series, A m erican
M a n a g e m e n t A sso cia tio n , 1923, N o . 3, p . 6.
is E m p lo yee-rep resen tation con feren ce, P h ila d e lp h ia , D ecem b er 1927, ad dress b y E . F . H a ll, v ice p resid en t
o f th e A m erican T elegrap h & T e le p h o n e C o.; rep rin ted in P erso n n el, N e w Y ork , F eb ru a ry 1928, p . 71 ff.
D E V E L O P M E N T S A F T E R T H E W A R P E R IO D
23
Opposition to and concern about radical labor ideology was most
frequently and emphatically voiced at these meetings. Suggestions 14
and recommendations were made for educating the workers in the
true principles of economics:
Industrial concerns are recognizing the fact that the only way of avoiding in
dustrial instability and unrest which promises success is by acquainting their men
with right principles and economic facts * * *. There is scarcely a work
ingman in America who is not more or less constantly exposed to the vicious
misrepresentation or mistaken creed of radical thinkers. * * * Their preach
ments are those for the most part of devoted fanatics and carry conviction to
the minds untrained to think clearly and untaught in social wisdom. There is
only one way to offset the goodwill-destroying propaganda of radicalism, and that
is by the spread of truth and wisdom in undistortable form.15
The National Association of Manufacturers was likewise favorable
towards employee representation. At its 1921 convention a report of
the committee on industrial betterment, health, and safety contained
this passage:
The widening movement for the “ Open Shop” is stimulated by the extension of
plans for industrial representation which are being rapidly introduced, not only
in manufacturing establishments, but in other industrial organizations. A firm
foothold has been obtained by the industrial representation idea. If plans for
its adoption are wisely introduced representation should become the most ap
proved method of dealing with labor.16
A report at the convention of 1922 disapproved of employers who
had abandoned their works councils during the depression, because
this might create unfavorable impressions among the workers as
regards employers’ motives behind the council idea; but it also dis
approved of companies placing employee representatives on the board
of directors as a “ radical, unwise, and unjustified step.” 17 Through
out the advocacy of representation plans there was apparent an in
sistence on limiting them to a merely advisory role.
You will note that we state very definitely that the (advisory) committees
have no administrative, executive, or legislative functions. It is our own experi
ence that the man on the job is not particularly concerned about having a voice
in the general management of the plant; especially is this true when as a result
14 O n e m e th o d of a c q u a in tin g w ork ers w ith p rop er eco n o m ic p r in c ip les w a s su g g ested b y a p erson n el
officer o f o n e o f th e large C h icago m ea t-p a ck in g h o u ses in a p a p er “ T u n in g th e e m p lo y e e p u b lic a tio n in to
th e p er so n n e l program ." H e stressed th a t th e le sso n to b e ta u g h t sh o u ld b e n o t o b v io u s a n d tireso m e b u t
s u b tle a n d en terta in in g . H e referred to a c o lu m n in h is c o m p a n y ’s p a p er e n title d “ M ik e th e B arb er" ,
w h o se h o m e ly w isd o m se ts r ig h t th e m a n y -m in d e d v ie w s of h is cu sto m ers from th e sto ck y a rd s. “ R a ts" ,
a sto ck y a rd ra d ica l, sn eers a t “ th e m b ig g u y s th a t g it fello w s lik e y u h e a tin ’ o u ta th eir h a n d s b y m e e tin ’
w ith y u h in th e m c o m p a n y u n io n s a n ’ m a k in ’ y u h th in k y u h ’re th e w h o le ch eese." R a ts’ la s t a tte m p t
to sa v e h is a rg u m en t, “ w e a in ’t a ll e q u a l" , is d isp o sed of b y M ik e th e B arber: “ C ou rse w e a in ’t. P eo p le
n ev er w a s. B e tte r h a v e so m e rich a n ’ so m e p oor w ith a ll h a v in ’ a lo t th a t th e y can e n jo y th a n to h a v e
’e m all eq u a l a n ’ a ll m iserab le. (L a u g h ter a n d ap p la u se.)" A d d ress b y A . H . C arver, director of tra in in g
a c tiv itie s, S w ift & C o., c o n v en tio n o f 1923, C o n v en tio n A d d ress S eries, N o . 7, p p . 8 ,1 0 .
16 R ep o rt o f th e c o m m itte e o n eco n o m ic p rin cip les for e m p lo y ee s p resen ted a t c o n v en tio n o f 1923 b y D r.
A . J. B e a ttie , A m erican R o llin g M ill C o ., M id d le to w n , O h io, C o m m itte e R ep o rt Series, N o . 2, p . 6 ff.
16 N a tio n a l A sso cia tio n of M an u fa ctu rers. P ro ceed in g s o f th e T w e n ty -six th A n n u a l C o n v en tio n , 1921,
p . 21.
17 Id e m , A n n u a l C o n v en tio n of 1922, p . 9.
24
CHARACTERISTICS OF COMPANY UNIONS
of humane, enlightening policies he has acquired a feeling of confidence in and
respect for the managing executives.18
Plans introduced.— An example of an industrial representation plan
with merely advisory functions, introduced during this period, is that
of the Schenectady plant of the General Electric Co. This was
established in 1924 in the wake of prolonged strikes of the metal
workers, after which dealings with the trade-union had been aban
doned by the company. The plan19 consisted of a joint council made
up of representatives of workers and management, the general manager
presiding at the monthly meetings. Individual grievances were not
usually brought up at these meetings, but settled between the indi
viduals concerned and the foreman, if necessary with the assistance
of a councilman. Nor were wages usually discussed.
In only one instance was a wage question raised in the council. A suggestion
was made that considerations be given to methods employed in reducing wages.
At the meeting the manager asked that the councilman responsible for the ques
tion make known his identity. There was no response and the issue was closed
by the statement of the manager that there was no cutting, that, on the contrary,
wages had reached a higher level than at any other time.20
Representation plans with similar ends were also introduced in the
textile industries, notably in some large New England cotton mills,
such as the Amoskeag Manufacturing Company at Manchester,
N. H., and the Pacific Mills at Lawrence, Mass. The preamble of
the latter stated that the plan was to be advisory; that it was to pro
vide “ the employes with a means of expressing to the management
their opinions on all matters concerning their working conditions”
and “ management with a means of consulting with the employees on
matters of mutual concern.” 21
The growth of the company-union movement in this period is
revealed by data of the National Industrial Conference B oard:22
The number of companies with plans grew from 385 in 1922 to 421 in
1924, to 432 in 1926, and then fell to 399 in 1928. This rise and fall
was the net result of many plans being abandoned and others being
adopted. From 1922 to 1928, 226 plans are reported as abandoned
and 246 as newly organized. The number of workers covered by com
pany unions, on the other hand, continued to grow throughout the
period, from 690,000 in 1922 to 1,240,704 in 1924, to 1,369,078 in
18A d d ress o n F u n d a m e n ta l P rin cip les of S o u n d In d u stria l R e la tio n s, b y C . R . H o o k , A m erican R o llin g
M ill C o ., M id d le to w n , O h io, T w e n ty -n in th A n n u a l C o n v en tio n of th e N a tio n a l A sso cia tio n o f M a n u
factu rers, 1924, P roceed in g s, p p . 99-100.
19 Jou rn al o f E lectrica l W ork ers an d O perators, R o ch ester, N . Y ., M a rch an d A p ril 1929: “ S tu d y o f th e
w ork s co u n cil o f th e G eneral E le c tr ic C o .” , b y M argaret D . M y ers.
20 Id em , A p ril 1929, p . 218.
21 T h e P a cific M ills p la n o f e m p lo y e rep resen tation . L a w an d L abor, N e w Y ork , S ep tem b er 1923,
p . 263.
22 N a tio n a l In d u stria l C onference B oard . C o llectiv e B a rg ain in g T h ro u g h E m p lo y e e R e p resen ta tio n .
N e w Y o rk , 1933, ta b le 1, p . 16.
DEVELOPMENTS AFTER THE WAR PERIOD
25
1926, and to 1,547,766 in 1928. While there was a net increase of 3.6
percent in companies which adopted employee-representation plans
between 1922 and 1928, there was, according to these figures, a net
increase of workers of about 124 percent. This continued growth as to
number of workers combined with a diminishing growth and finally
actual decline in the number of companies, reveals the fact that in the
earlier twenties more small- and medium-sized plants adopted repre
sentation plans, and that many of these were later abandoned while
large plants continued to adopt them. This is further revealed by
comparing the sizes of the establishments having plans between 1919
and 1932. Both in absolute number and in percentage the number of
plans in companies with less than 800 workers greatly diminished,
while those with more than 800 increased. As to number of workers
in establishments of various sizes, the percentage of the total in estab
lishments of less than 5,000 workers declined, while those above 5,000
grew. Among the very largest concerns with over 15,000 workers, the
percentage representation to the total grew from 48.6 to 63.1.23
Trade-unionism .— While this increase in membership in employeerepresentation plans was taking place, trade-union membership was
continuing to fall.24 So pronounced was the opposite trend in the
figures for the two movements that trade-unionists became most
seriously alarmed. Beginning with 1925, the annual conventions of
the American Federation of Labor heard reports, addresses, and reso
lutions on the menace of the company unions. At the convention
of 1926, one report stated that there were “ over 2 millions of wage
earners working under company unions” and that “ 50 percent of
the mileage in the railroad industry in the United States is operating
today under these semiserfdom labor conditions.” 25 This conven
tion adopted a resolution empowering the executive council to make
special assessments to carry out “ the study and campaign designed
to remove these employer controlled unions * * * out of our
industrial life.” 26 The convention of 1928 condemned them again
as “ the offspring of hypocrisy and greed.” 27
While condemning company unions in such unequivocal terms,
official trade-unionism itself adopted a harmony-emphasizing attitude
23N a tio n a l In d u stria l C onference B o ard . C o llectiv e B a rg ain in g T h rou gh E m p lo y e e R ep resen ta tio n .
N e w Y o rk , 1933, ta b le 2, p . 17. S o m e of th is m a y b e d u e to a sh ift in ty p e (size) o f firm w h ic h h a p p en ed to
rep ort to th e N a tio n a l In d u str ia l C onference B o ard .
24 A cco rd in g to th e rep orts o f th e e x e c u tiv e co u n cil a t th e several co n v en tio n s, p a id -u p m em b ersh ip in
th e A m erica n F ed era tio n o f L a b or b a rely h eld its o w n , fallin g from 2,926,468 in 1923 to 2,803,966 in 1926,
a n d ra lly in g ag ain to 2,933,545 in 1929. F or a ll tra d e-u n io n s, h o w ev er, M r . W o lm a n estim a te s th a t m e m
b ersh ip fell from 3,622,000 in 1923 to 3,442,000 in 1929. O p. c it., p . 16.
25 A m erican F ed eration of L abor. R ep ort o f P roceed in gs o f th e F o rty -six th A.nnual C o n v en tio n , 1926,
p. 290.
20 Id em , p. 291.
27
A m erican F ed era tio n of L abor. R ep ort of P roceed in gs of th e F o rty -eig h t A n n u a l C o n v en tio n , 1928,
p . 256.
1 5 4 8 7 0 ° — 3 8 -------3
26
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
toward industrial relations. Characteristic of this tendency is the
report on outstanding achievements at the convention of 1927:
* * * Foremost among these achievements is a change in public opinion
toward the trade-union. Many employers and much of the general public are
beginning to see that the union is not simply a militant organization with no
interest in work itself, but that in addition to its militant functions the union is the
agency through which the workers can make their fullest contribution to industry
and society. * * *
The establishment of collective bargaining opens the way for sustained coopera
tive relations between management and workers. * * * These constructive
activities are based upon a conception of the interdependence of all interests.
* * * Workers cannot help themselves by injuring other legitimate interests
in industry.28
Union-management cooperation became the new goal of trade-union
policy, the implication being that the spirit of industrial cooperation
was welcomed by trade-union leaders. They held, however, that the
workers should cooperate through the medium of the trade-unions
rather than through company unions. Outstanding examples of
union-management cooperation during this period were: The Balti
more and Ohio Railroad, which recognized the railroad brotherhoods
and all the shop crafts and maintenance-of-way unions as well; the
Chesapeake & Ohio; the Canadian National Railways; and the Chicago,
Milwaukee, St. Paul & Pacific schemes. In the clothing industry
the Amalgamated Clothing Workers of America established coop
erative arrangements with manufacturers and contractors in Milwaukee
and Chicago; in the cotton industry the United Textile Workers coop
erated with the Naumkeag Steam Cotton Co., (Pequot Mills) in Salem,
Mass.
The Depression Period, 1930-32
Manufacturing employment (persons on the pay roll whether working
full or part time) dropped 40 percent and pay rolls (total wages paid)
decreased 60 percent from 1929 to 1932.29 As a natural accompani
ment to the recession in business activity were changes in employeremployee attitudes and activities. The value of and the need for
company unions seemed to be attacked from all fronts. An unprec
edented unemployment situation caused workers who were fortunate
enough to keep their jobs to be less insistent about adjustment of
grievances, and to accept wage decreases and hour increases without
great complaint. Trade-unions, waning in number30 and vigor,
caused employers to think it less necessary to have company unions to
compete for the workers’ allegiance. To the extent that company
28 A m erican F ed eration of L abor. R ep ort o f P ro ceed in g s of th e F o r ty -se v en th A n n u a l C o n v en tio n ,
1927, p p . 34-35.
29 U . S. D e p a r tm e n t o f L ab or. B u rea u o f L ab or S ta tistics. B u ll. N o . 610: R e v ise d in d ex o f facto ry e m
p lo y m e n t a n d p a y rolls, 1919 to 1933. W a sh in g to n , 1935, p. 22.
30 M r. W o lm a n e stim a te s th a t to ta l m em b ersh ip of A m erican trad e-u n io n s fell from 3,442,600 in 1929 to
3,144,300 in 1932. O p. c it., p . 16.
D E V E L O P M E N T S A F T E R T H E W A R P E R IO D
27
unions had been used to administer welfare activities, they became
superfluous as these activities were abandoned in the process of adapt
ing economies to the business recession.31 Related to these causes for
decreased interest in company unions was the fact that some plants
with company unions closed down altogether or kept open with such
drastic reductions in working force as to cause disintegration of their
employee organizations.
A report of the National Industrial Conference Board 32 shows that
the number of firms maintaining company unions decreased from 399
in 1928 to 313 in 1932, a net decline of more than 20 percent. As to
workers, the decline given is from 1,547,766 to 1,263,194, or about 18
percent.33 Of the 592 establishments which reported to the Bureau of
Labor Statistics as having company unions in 1935, only 29 were stated
to have been organized between 1930 and 1932.34 Most of these, how
ever, were in small plants— 25 of the 29 having less than 500 workers,
with 18 less than 200 workers.
Despite the decrease during the depression, there were forces which
made for the continuation and even the establishment of company
unions. The net decline in company unions was not comparable to
the recession in business activity and employment. Some company
unions had become so much a part of the warp and woof of the indus
trial organism that they could not be discarded. Some were retained
to share the responsibility and absorb the shock of wage cuts and lay
offs. Some were in establishments such as public utilities, which
suffered comparatively little from the depression and where there was
therefore no need to alter labor-relations arrangements. Some were
in industries or plants, for example, textiles, where there was enough
labor unrest and trade-union activity to encourage the continuance
and even the establishment of company unions.
Many company unions were, however, abandoned and relatively
few new ones established during the depression. Company union
ism, along with personnel management and welfare programs, was
on the retreat with every indication of further curtailment.
The National Industrial Recovery Act
With the National Industrial Recovery Act on June 16, 1933, came
a complete change in the picture.35 Immediately upon the passage
of this act, there was a marked growth in trade-union activity and
organization. International unions increased their rolls by adding
31 A s tu d y b y th e N a tio n a l In d u stria l C onference B oard (E ffect of th e D ep ressio n on In d u stria l R ela tio n s
P rogram s, N e w Y o rk , 1934) rev ea ls n o ticea b le decreases in b e n e fit a c tiv itie s in in d u stria l p la n ts d u rin g th e
d ep ression . T h is w a s p a rtic u la r ly m ark ed w ith r esp ect to e m p lo y e e sto c k p u rch a se p la n s, p rofit sh arin g,
v a c a tio n s w ith p a y , su g g e stio n sy ste m s, h o m e p u rch a se p la n s, a n d p la n t r esta u ra n ts.
32 N a tio n a l In d u str ia l C onference B oard. C o llectiv e B arg ain in g T h rou gh E m p lo y e e R ep resen ta tio n .
N e w Y ork , 1933, ta b le 1, p . 16.
33 I t is p o ssib le th a t so m e o f th e rep ortin g com p a n ies cou n ted am on g th e m em b ers e m p lo y ee s w h o had
b een la id off for th e tim e b ein g b u t n o t a c tu a lly discharged .
84 S e e p t. II, p . 51.
35 See a p p en d ix I, p p . 225, for sectio n s o f th is act rela tin g to lab or relation s.
28
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
new members to their old locals as well as by the formation of new
locals. In addition, many new federal labor unions, directly affili
ated with the American Federation of Labor, were organized in indus
tries and trades not included within the jurisdiction of the existing
international unions. Many of these were in hitherto unorganized
mass-production industries such as automobiles, rubber, cement,
and aluminum. The total paid-up membership in the A. F. of L.
increased 43 percent— from 2,126,796 in 1933 to 3,045,347 in 1935.36
Concurrent with this growth in trade-unionism was an even greater
increase in company unions. Of all the company unions in existence
in 1935, nearly two-thirds were established during the N. R. A.37
In a number of plants both company unions and trade-unions were
established, with overlapping of membership and jurisdiction.
A cross-section picture of the extent of trade-unions and company
unions during the latter months of the N. R. A. and a detailed
analysis of the characteristics of company unionism are given in the
following pages.
36 A m erican F ed era tio n o f L abor. R ep ort of P roceed in g s of th e F ifty -fifth A n n u a l C o n v en tio n , 1935, p . 29.
37 S e e p p . 50-51; N a tio n a l In d u stria l C onference B oard : In d iv id u a l a n d C o llectiv e B arg ain in g U n d er N . I.
R . A ., N e w Y ork , 1933, ta b le 6, p . 24.
PART II
Extent and Characteristics o f Company Unions
29
Extent and Characteristics o f Company Unions
The following analysis is based upon returns from the questionnaire
sent in April 1935 to approximately 43,000 establishments reporting
monthly employment data to the Bureau of Labor Statistics. A total
of 14,725 usable replies were received. (See appendix IV for details
on scope and method of this mail inquiry as well as a copy of the
questionnaire.) These replies present a quantitative picture of the
extent of various methods of employer-employee dealing.
A total of 592 establishments in which company unions existed
replied to this mail inquiry. The data furnished on these present a
picture of certain major characteristics of company unions. On
matters which can be readily tabulated with a minimum of interpreta
tion they furnish a broad sample which lends itself to generalization.
This quantitative material thus supplements and extends the results
of the field study presented in part III.1
1 In o n e resp ect th e q u a n tita tiv e figures correct th e con clu sion s o f th e field stu d y . T h e la tter d id n o t in
clu d e a n y o f th e fed erated ty p e o f c o m p a n y u n io n , su ch as th e L o y a l L egio n o f L oggers a n d L u m b erm en .
In clu sio n of su c h cases in th e sa m p le for th e q u a n tita tiv e s tu d y in creases th e n u m b er o f c o m p a n y u n io n s in
th a t group th a t h a v e a n o p tion al-m em b ersh ip b a sis o f p a rticip ation , d u es p ro v isio n s, regular m em b ersh ip
m eetin g s, w r itten ag reem en ts, a n d in terco m p a n y con tacts. P articu la rly d oes it increase th e n u m b er of
co m p a n y u n io n s d a tin g from before 1933 w h ic h p o ssess th ese characteristics.
31
Chapter III
Types o f Employer-Employee Dealing1
In April 1935, 76.5 percent of the establishments which reported to
the Bureau of Labor Statistics dealt with their employees on an
individual basis only; 19.5 percent dealt with some or all of their
employees through trade-unions but had no company unions; 0.6 per
cent dealt through both trade-unions and company unions; and 3.4
percent through a company union alone. These percentages are based
on an analysis of 14,725 replies to a mail questionnaire. Of the estab
lishments which reported, 11,267 dealt with their employees on an
individual basis only; 2,866 dealt with some or all of their employees
through trade-unions but had no company unions; 96 dealt through
both trade-unions and company unions; and 496 through a company
union alone.
Methods of employer-employee dealing vary, among other things,
with the size of the establishment. Of the plants covered, 85 percent
of those which employed fewer than 50 workers dealt on an individual
basis; only 8 percent of the plants with more than 5,000 workers dealt
on that basis. Less than 1 percent of the smaller establishments
covered had company unions, whereas 48 percent of those with more
than 5,000 workers had such organizations, and an additional 28
percent dealt through both company unions and trade-unions. Tradeunion dealing was relatively most common among plants of inter
mediate size, reaching its maximum proportion in the group of
establishments having from 1,000 to 2,500 workers.
Since the method of handling employer-employee relations varies
with the size of the establishment, it follows that the percentages of
employees covered by the various types of dealing differed from the
percentages of establishments. Establishments dealing individually
1 T h is ch ap ter d eals w ith m a n u fa ctu rin g , m in in g , an d selected service, tra d e, a n d p u b lic u tility in d u stries.
T e lep h o n e, telegra p h , a n d railroad in d u stries are a n a ly zed in ch ap ter IV .
P relim in a ry an a ly ses o f th ese d a ta ap p ea red in th e M o n th ly L a b or R e v ie w in O ctober 1935 an d D ece m b e r
1935. S in ce th e p u b lica tio n o f th e first a rticle, certain m in o r correction s h a v e b een m a d e in th e figures.
F u rth er exa m in ation h a s in a n u m b er o f cases p e r m itted fillin g in g a p s in th e d a ta . In on e case fu rth er
correspondence sh o w ed th a t a p la n t d ea lin g th ro u g h a tra d e-u n io n o n ly h a d b een in correctly classified in
th e first rep ort a s d ealin g th ro u g h b o th a c o m p a n y u n io n a n d a trad e-u n io n .
I t sh o u ld b e rem em b ered th a t th is s tu d y p resen ts th e p ictu re as o f A p ril 1935. I t fails to sh o w th e p resen t
situ a tio n in m a n y in d u stries, su ch a s steel a n d a u to m o b iles, in w h ic h trad e-u n io n org an ization d riv es h a v e
resu lted in m a rk ed ly increased tra d e-u n io n d ealin g an d d ecreased com p a n y -u n io n d ealin g.
32
T Y P E S O F E M P L O Y E R -E M P L O Y E E D E A L IN G
33
accounted for 822,674, or 42.5 percent, of the total of 1,935,673 workers
employed in the 14,725 establishments covered; those dealing partly
or wholly through trade-unions employed 584,466, or 30.2 percent,
of the workers; establishments with both company unions and tradeunions included 142,579, or 7.4 percent, of all the workers employed
in the plants surveyed, while the 496 establishments which dealt
through company unions had 385,954 workers, or 19.9 percent,3
of the total.
Ninety percent of the 2,866 establishments dealing through a
trade-union, having a similar proportion of employees, specified in
their replies the number of their workers who were covered by tradeunion dealings. The replies indicated that in these establishments an
average of 86.6 percent of the workers were covered by trade-union
dealings. Assuming that this proportion held for all establishments
dealing through trade-unions alone, of the 584,466 workers in such
establishments 505,211 would have been covered by trade-union
dealings, the remaining 79,255 dealing with the employer on an
individual basis.
These figures are not to be taken as totals of the number of workers
who were members of trade-unions or company unions in the industries
covered. They relate to the number of workers affected by various
types of dealing rather than to the number of members in various
types of organizations. Furthermore, the figures are derived from
replies which cover on the average approximately 22 percent of the
workers in these industries. Therefore the proportions are more
significant than the absolute figures. Finally, it should be noted
that the proportions are more accurate with reference to particular
industries, or with reference to plants classified on the basis of size,
than they are for the over-all total for the country. This is due to
the fact that not all industries or sizes of establishment are equally
covered.
2
T h ere w a s on e u n fo rtu n a te gap in th e o th erw ise ran d o m sa m p le. C om p arab le d a ta w ere n o t av a ila b le
for th e su b sid ia r y co m p a n ies o f o n e o f th e largest u n its in th e ste el in d u str y . C o m p a n y u n io n s ex isted in
all or p ra ctica lly all o f th ese su b sid ia ry com p a n ies a n d th e y p ro v id ed for a u to m a tic p a rticip a tio n . (H earin gs
before C o m m itte e o n E d u c a tio n a n d L abor, U n ite d S ta tes S en a te (73d C on g ., 2d se ss.), A p r. 5, 1934. T o
create a N a tio n a l L ab or B o ard . W a sh in g to n , 1934, vo l. 3, p . 724.) T herefore th e n u m b er o f c o m p a n y
u n io n s h ere g iv e n is so m ew h a t sm a ller th a n it sh o u ld be an d th e n u m b er o f e m p lo y ee s cov ered b y c o m p a n y
u n io n s is su b sta n tia lly sm a ller. I f com p a ra b le d a ta h a d b een a v a ila b le for th ese con cern s, it m ig h t h a v e
raised th e to ta l n u m b er o f w ork ers covered b y rep orts to a p p ro x im a tely 1,988,000, o f w h o m p erh ap s 439,000,
or 22.1 p ercen t, m ig h t h a v e b een in c o m p a n y u n io n s. T h ere is n o accu rate m e th o d o f correction for th is
om issio n as th e B u rea u d id n o t receiv e rep lies from a ll firm s o n th e m a ilin g list a n d th e arb itrary in clu sio n
o f th e e m p lo y ee s o f th ese co m p a n ies w o u ld create a n o p p o site b ia s from th a t ex istin g in th e ta b u la tio n s.
A t all e v e n ts, th e ch an g e in th e gran d to ta ls cite d w o u ld h a v e b e e n sm a ll.
T h is in co n clu siv en ess o f th e B u r e a u ’s figures, w h ic h are b ased so lely o n rep orts receiv ed , b ecom es so m e
w h a t m ore seriou s in th e d u rable-goods in d u stries, th e iron an d steel group as a w h o le, a n d e sp e c ia lly b la st
furnaces an d rollin g m ills. T h ere m a y also b e so m e u n d ersta tem en t o f th e p rop o rtion o f em p lo y ees covered
b y co m p a n y u n io n s in sh ip b u ild in g an d cem en t esta b lish m en ts.
34
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
Variations in Methods of Dealing, by Industry
Manufacturing establishments constituted about two-thirds of those
submitting data (table 1). Seventy-four percent dealt only indi
vidually with their employees. Plants dealing through a trade-union
constituted 21.0 percent of the total. Company unions alone or
company unions and trade-unions jointly were reported for 5.2
percent of the manufacturing establishments. Among the nonmanu
facturing groups, the highest proportions of establishments dealing
with their employees on an individual basis were reported from whole
sale trade (95.9 percent), retail trade (93 percent), and the service
group of industries (88.8 percent). Of those three groups, retail trade
was the only one with as many as 1 percent of the establishments
dealing through company unions alone or company unions and tradeunions jointly.
Public utilities and mining showed a lower proportion of estab
lishments dealing individually than did manufacturing, 64.6 percent
and 46.6 percent, respectively. Only in mining, among the major
classifications of enterprises, did the number of establishments dealing
through a trade-union exceed the number dealing individually.
Among mines reporting, only 1.2 percent dealt through some form of
company union. More than three times as many public-utility estab
lishments dealt through trade-unions alone as dealt through company
unions alone.
Within the manufacturing group as a whole there were significant
variations. Eighty-one percent of the establishments engaged in the
manufacture of durable goods dealt individually, as compared with
68.2 percent among the nondurable-goods groups. Approximately
one-eighth of the durable-goods establishments dealt with a tradeunion but not a company union; the comparable figure for nondurable
goods was over twice as large. While the proportion of the durablegoods establishments dealing through a company union alone was
5.8 percent, only 3.4 percent of the nondurable-goods establishments
fell in this category. Somewhat less than 1 percent of the establish
ments in each group dealt through both a trade-union and a company
union.
35
T Y P E S O F E M P L O Y E R -E M P L O Y E E D E A L IN G
T
.
a b l e 1 — Distribution
of establishments by method of dealing and industry groups,
April 1935
Number
E sta b lish m e n ts d ealin g—
T o ta l
e sta b
lish
m en ts
In d u str y group
A ll in d u stries covered 1_________________ ______________
A ll m a n u fa ctu rin g in d u s tr ie s 1---------------------. . . _______
D u r a b le g o o d s 1___________________ ____________ ...
Iron a n d s t e e l2-------------------------------------- ----------M a c h in e r y ________ ______ _____ ______ _______ __
T ra n sp o rta tio n e q u ip m e n t1----------- -----------w_
N o n ferrou s m e ta ls_______________ ______________
L u m b e r a n d a llie d p r o d u c t s ._______ . . ____
S to n e, c la y , a n d g la ss p r o d u c ts 2_. ___________
N o n d u r a b le g o o d s __________ . -------------------------------T e x tile s A . - ------------------------------------------------------F ab rics (ex ce p t h a ts ).
. ______________
W earin g ap p arel (ex cep t m illin e r y ) _____
L ea th er____ _____________________________ _______
F o o d 6___________ _____________________ _______
C igars
_w_
P a p er a n d p r in tin g ___________. _________________
C h em ica ls__________ ____________________________
R u b b er p rod u cts (ex cep t b o o ts a n d s h o e s ).__
M iscella n eo u s n o n d u rab le good s .
...
M iscella n eo u s m an u factu res . . .
.
_.
S erv ice ________ ___________ ___________________ _____ . . .
P u b lic u t ilit ie s 7_________________________________________
M in in g _____________ ____________ __________________ _ _.
R e ta il t r a d e 8_________________ - __________________________
W h olesa le tra d e 9________ ________ . .
. . . ...
14, 725
9,854
4,279
721
1,493
194
440
912
519
5,490
1,605
889
665
208
1,523
96
1,388
578
70
22
85
899
285
967
1,398
1,322
W ith
T h ro u g h
so m e
all T h rou gh c o m p a n y
In d iv id w or
orkers
c
o
m
p
a
n
y
u n io n
u a lly
th rou gh
u n io n an d tradetradeu n io n
u n io n
11,267
7, 268
3,467
3 556
< 1, 251
149
379
785
347
3, 745
1,017
710
283
131
1,159
62
824
490
51
11
56
798
184
450
1,300
101,267
2,866
2,069
532
3 94
4 136
20
40
95
147
1,522
535
142
366
61
332
34
518
23
8
11
15
95
72
505
76
10 4 9
496
445
247
62
95
22
19
30
19
188
44
31
13
16
22
45
54
7
10
5
20
10
10
96
72
33
9
11
3
2
2
6
35
9
6
3
10
1
11
4
4
1
9
2
12
6
Percentage
0.6
3 .4
19.5
100.0
76.5
A ll in d u str ie s covered L . _ . . . ------------ ---------------------.7
21.0
4 .5
100.0
A ll m a n u fa ctu rin g in d u stries 1.
73.8
.8
81 .0
12.4
5 .8
100.0
D u r a b le go od s 1____ ._ . . . . . __________________
1.2
3 13.1
8.6
3 77.1
100.0
Iron a n d s t e e l 2_ __________ ____________________
49.1
.7
6 .4
M a c h in e r y ._ ___________ _______ __ _________
100.0
4 83.8
1.6
11.3
100.0
76.8
10.3
T ra n sp o rta tio n e q u ip m e n t 1__________________
.5
4 .3
100.0
9 .1
86.1
N o n ferrou s m e ta ls_________ . . _________. . . .
.2
3 .3
100.0
86.1
10.4
L u m b er a n d a llied p r o d u c ts. . . ______ ______
1.1
100.0
66.9
28.3
3 .7
S ton e, c la y , a n d gla ss p r o d u c ts 2______________
3 .4
.7
68.2
27.7
100.0
N o n d u r a b le g o o d s .. . ________ _____ _______ _____
.6
2.8
33.3
100.0
63.3
T e x t ile s 6________________________________________
.7
16.0
3 .4
100.0
79.9
F ab rics (ex cep t h a ts )_ __ _______ . . . . . .
.5
55.0
2.0
100.0
42.5
W earin g a p p arel (ex cep t m illin e r y ) ____
7 .7
L eath er
29.3
100.0
63.0
1.4
.7
21.8
100.0
76.1
F o o d 6___________________ ______________________
C igars
35.4
64.6
100. 0
3 .2
.1
37.4
100.0
59.3
P ap er a n d p r in t in g _____________ _ . ----------9 .3
1.9
84.8
4 .0
100.0
C h em ica ls__________________________________ _
5 .7
10.0
11.4
100.0
72.9
R u b b er p ro d u cts (ex cep t b o o ts a n d s h o e s ).-TVTisp.p.11an s T^nnrjiir^hlft gnorls
50.0
50.0
100. 0
4 .7
11.8
65.9
17.6
100.0
M isc e lla n e o u s m a n u fa ctu res________________ ______
.1
.5
10.6
100.0
88.8
S er v ic e ____________ ____________ _ ____________________
3.1
7 .0
25.3
100.0
64.6
P u b lic u t ilit ie s 7_________ . . . . _______________________
.2
1.0
52 .2
100.0
46.6
M in in g ____________________________________________________
.9
5 .4
.7
100.0
93.0
R e ta il t r a d e 8_________ ___ ________________________ . .
.4
100.0 19 95. 9
103 .7
W h o lesa le t r a d e 9_______________ _________________________
1S ee te x t fo o tn o tes 2 a n d 3 (p p . 33,36).
2See te x t fo o tn o te 2 (p. 33).
3 S ee ta b le 3, fo o tn ote 3.
4 See ta b le 3, fo o tn otes 4 an d 5.
®In c lu d in g m iscella n eo u s tex tile p rod u cts.
6See ta b le 3, footn ote 9.
7E x clu d in g telep h o n e an d telegra p h an d railroads. See ch . I V .
8C overs o n ly reta il grocery, m ea t, an d p rod u ce stores, th e general m erch a n d ise group, an d w o m e n s
rea d y-to -w ear stores.
0C ov ers o n ly a u to m o tiv e , ch em ica ls an d drugs, d ry goods an d ap parel, electrical e q u ip m e n t, farm
p ro d u cts, farm su p p lies, an d food p rod u cts.
10S ee ta b le 3, footn ote 13.
36
C H A R A C T E R IS T IC S OF C O M P A N Y U N IO N S
The general pattern of dealing with employees which is indicated
by the figures for all manufactures was found in all but a few of the
individual manufacturing groups (table 1), Only in wearing apparel
did the number of establishments reported as dealing through a tradeunion exceed the number dealing individually. In two other groups—
chemicals and transportation equipment3— the number of firms deal
ing through a trade-union was smaller than the number dealing
through a company union alone. No company unions were reported
for the cigar firms furnishing data.
Among the manufacturing industries, the largest proportion of
establishments dealing on an individual basis was found in the nonferrous metals and the lumber groups, with the chemicals group close
behind. Apart from wearing apparel, in which the firms dealing with
trade-unions constituted a majority, the largest proportions of tradeunion dealing were found in paper and printing, cigar making, leather,
and stone, clay, and glass products. The smallest proportions dealing
with trade-unions were reported for chemicals, nonferrous metals,
and machinery. In terms of the proportion of establishments re
ported as having company unions, transportation equipment,3 rubber
products, and chemicals headed the list. Apart from cigar firms, the
smallest proportion of company unions among the manufacturing
groups surveyed was found in food and wearing apparel. Combina
tion company-union and trade-union arrangements were most frequent
in the rubber-products group; they did not appear at all in the returns
for leather products, cigars, and wholesale-trade groups.
Employees Affected by Various Methods of Dealing
The relative significance of the different methods of dealing with
employees is altered considerably when attention is directed to the
number of workers in the establishments concerned (table 2). Thus
establishments with trade-unions alone employed 30.2 percent of the
total number of workers, those with company unions alone 19.9
percent, and those with both company unions and trade-unions
7.4 percent. The extent to which establishments which dealt indi
vidually were below the average in size is indicated by the fact that,
although 76.5 percent of the establishments dealt individually, these
establishments accounted for only 42.5 percent of the total workers
covered by the survey.
3
T h e figures for th e tra n sp o rta tio n -eq u ip m en t gro u p d o n o t in c lu d e rep lies from 4 a u to m o b ile p la n ts,
w ith 34,306 w orkers, w h ic h h a d a n a g e n cy se t u p b y th e A u to m o b ile L abor B o ard an d n o o th er organiza
tio n for c o lle c tiv e d ealin g . S in ce th is arran g em en t con form ed to n o n e of th e classification s u se d h ere, th ese
e sta b lish m e n ts are n o t in c lu d e d in arrivin g a t th e d istrib u tio n b y m e th o d s o f d ealin g . I f th ese 4 p la n ts w ere
in c lu d e d as a sep arate group, th e resu ltin g p ercen tag es for th e e sta b lish m e n ts w o u ld b e 72.3 p ercen t in d i
v id u a lly ; 10.8 p ercen t th ro u g h tra d e-u n io n s, 12.3 p ercen t th ro u g h c o m p a n y u n io n s, 1.5 p ercen t th ro u gh
c o m p a n y u n io n a n d trad e-u n ion ; a n d 3.1 p ercen t th ro u gh A u to m o b ile L ab or B o ard c o llectiv e b arg ain in g
a g en cy w ith n eith er tra d e-u n io n n or c o m p a n y u n io n . T h e corresp on d in g p ercen tages for w orkers w o u ld
b e 10.1, 13.8, 26 .6,16.8 , an d 32.7.
TYPES OF EMPLOYER-EMPLOYEE DEALING
37
T able 2. — Distribution of workers by method of dealing and industry groups,
April 1935
Number
W orkers in esta b lish m e n ts d e a lin g -
in d u s tr y group
T o ta l
w orkers
covered In d iv id
b y rep lies u a lly
1,935, 673 822, 674
A ll in d u stries covered L.
A ll m a n u fa ctu rin g in d u stries 1—
1,428, 613 607, 446
649, 536 258, 233
D u r a b le go od s 1_______________
Iron an d ste el 2----------------108, 555 3 31, 639
M a ch in e r y -----------------------266, 291 1105, 630
T ra n sp o rta tio n e q u ip m e n t1----93,082 19, 243
N on ferro u s m e ta ls______________
56, 582 32,922
L u m b er a n d allied p r o d u c ts. __
77,428 58, 003
47, 598 10, 796
N o n d u r a b le g o o d s___________________ 755, 744 344, 013
T e x tile s 5_________________________ 329,818 200, 296
F ab rics (ex cep t h a ts)_______ 250, 434 170, 502
W earin g a p p arel (ex cep t
m illin e r y )_________________
74,452 27,893
L e a th e r__________________________
51,809 19,112
F o o d 6____________________________
86, 586 39, 200
C iga rs____________________________
10, 564
7,818
P ap er an d p r in tin g _____________ 111,748 42, 261
C h e m ica ls_______________________
105,626 26, 853
R u b b er p ro d u cts (ex cep t b o o ts
an d sh o e s)_____________________
53,109
6, 611
M iscella n eo u s n o n d u r a b l e
g o o d s__________________________
6, 484
1,862
23, 333
M iscella n eo u s m an u fa ctu res_______
5, 200
50,586 43,534
S ervice____________________________________
P u b lic u tilitie s ^__________________________ 111, 236 30, 531
M in in g ____________________________________ 185, 035 18, 369
R e ta il trad e 8_____________________________ 133,131 97,193
27,072 10 25, 601
W h o le s a l e tra d e **--------------------------------------------
W ith so m e or all w orkers
th ro u gh tra d e-u n io n s
T h ro u g h
E sti T h rou gh pcoa mn y
m a ted c o m
u n io n
n u m b er p a n y
an d
not
u n io n
tra d ecov er
u
n io n
ed b y
tradeunion®
T o ta l
E sti
m a ted
n u m b er
cov er
ed b y
trad eunion®
584,466
344, 440
109, 293
3 14, 742
* 28. 682
18; 532
8.390
8; 740
30, 207
232, 909
101, 668
56, 991
41,646
23, 548
30,910
2, 746
50,020
14,716
4, 679
4, 622
2,238
5,855
56, 234
161,341
15, 232
10 1,364
505,211
278, 700
79, 372
11, 490
18, 589
15, 738
6,689
6,806
20,170
197, 369
92, 757
49, 240
40, 646
18, 569
24, 762
2, 643
37, 292
13,667
3,832
4, 622
1, 795
3,231
53,010
160, 231
1,191
956
79, 255
65,740
29,921
3, 252
10,093
2, 794
1,701
1,934
10,037
35, 540
8,911
7, 751
1,000
4,979
6,148
103
12, 728
1,049
443
2,624
3, 224
1,110
14,041
408
13, 774
1,152
16,960
4,375
7, 780
107
2,121
45
7,511
950
12,926
30.2
24.1
16.8
3 13.6
4 10.8
19.9
14.8
11.3
63.5
30.8
30.8
22.7
55.9
45.4
35.7
26.0
44.8
14.0
8 .8
71.3
9 .6
26.1
19.5
12.2
10.6
7 .0
16.9
11.8
8 .8
42.4
26. 1
28.1
19.6
54.6
35.8
28.6
25. 0
33.4
13.0
7 .2
71.3
7 .7
4.1
4 .6
4 .6
3 .0
3 .8
3 .0
3 .0
2 .5
21.1
4 .7
2.7
3.1
1.3
9 .6
7.1
1 .0
11.4
1.0
1.6
19.9
24.9
34.0
49.3
39.6
39.7
23.0
12.1
5.9
16.0
6 .3
6.7
5.4
17.7
8 .0
16.8
54.9
13.1
7.4
8 .5
9 .4
8 .0
10.0
19.7
4 .0
1.7
7 .9
7 .7
2 .2
2 .5
1 .2
11.0
.6
5 .7
65.6
1.9
59.6
9.1
385,954
355, 580
221, 204
53, 539
105, 582
36, 920
12,993
9,335
2,835
120, 602
20, 706
16, 713
3,993
9,149
6,918
18,867
58,005
847
6,957
142, 579
121,147
60,806
8,635
26, 397
18, 387
2,277
1,350
3, 760
58, 220
7.148
6,228
920
9, 558
600
6,052
34,862
Percentage
_______ __ __
A ll in d u stries covered
A ll m a n u fa ctu rin g in d u stries 1 _______
D u r a b le go od s 1______________________
Iron an d steel 2- _ __________ __
M a c h in e r y .______ __ ______ __
T ra n sp o rta tio n e q u ip m e n t1___
N on ferrou s m e ta ls ________ __
L u m b er an d a llied p ro d u cts___
S ton e, c la y , an d g la ss p r o d u c ts2.
N o n d u r a b le g o o d s .__
________
T e x tile s 5_________________________
F ab rics (ex cep t h a ts) ______
W earin g ap p arel (ex cep t
m illin e r y )_______ __________
L e a th e r _______________ _ __ . . .
F o o d 6 _ _______ _ __________
C igars _________________ ________
P ap er an d p r in tin g ____ ______
C h em ica ls ________________ _ _
R u b b er p ro d u cts (ex cep t b o o ts
an d sh o e s)_____________________
M iscella n eo u s n o n d u r a b l e
good s ______ __ _ _______
M iscella n eo u s m an u fa ctu res..............
See footn otes a t en d o f ta b le.
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
42.5
42.5
39.8
3 29.1
4 39.6
20.7
58.2
74.9
22.7
45.5
60.7
68.1
37.5
36. 9
45.3
74.0
37.8
25.4
12.5
28.7
22.3
38
CHARACTERISTICS OF COMPANY UNIONS
T able 2. — Distribution of workers by method of dealing and industry groups, April
1935— Continued
Percentage
W orkers in e sta b lish m e n ts d ealin g—
In d u str y group
S erv ice___________
P u b lic u tilitie s 7. .
M in in g ___________
R e ta il tra d e 8____
W h olesa le trad e 9
T o ta l
w orkers
covered In d iv id
b y rep lies u a lly
100.0
100.0
100.0
100.0
100.0
86.0
27.4
9 .9
73.0
94. 6
W ith so m e or all w orkers
th ro u gh tra d e-u n io n s
T o ta l
11.6
50.6
87.2
11.4
io 5 .0
E sti
m a ted
n u m b er
cov er
ed b y
tradeu n io n
6.4
47.7
86.6
.9
3 .5
T h ro u g h
E sti T h rou gh pc oa mn y
m a ted co m
u n io n
n u m b er p a n y
an d
u n io n
not
tra d ecov er
u
n io n
ed b y
trad eu n io n
5 .2
2 .9
.6
10.5
1.5
2 .3
15.2
2 .4
5 .8
.4
0 .1
6 .8
.5
9 .8
° B a se d on rep lies from 90 p ercen t of th e esta b lish m e n ts d ealin g th ro u gh a tra d e-u n io n . F or d eta ils,
see p . 39. T h e estim a te s for th e to ta ls an d th e grand to ta l w ere arrived a t in d e p e n d e n tly on th e b a sis of
th e ap p rop riate p ercentages; th e y are therefore n o t ex a ctly eq u a l to th e su m s o f th e su b sid ia r y item s.
1 See te x t footn otes 1 an d 2 (p p . 32,33).
2 S ee te x t fo o tn ote 2 (p . 33).
3 See ta b le 3, footn ote 3.
4 See ta b le 3, fo o tn o tes 4 an d 5.
6 In c lu d in g m iscella n eo u s tex tile p rod u cts.
6 See ta b le 3, footn ote 9.
7 E x clu d in g telep h o n e a n d telegrap h an d railroads. See ch . IV .
8 C overs o n ly retail grocery, m ea t, an d p rod u ce stores, th e general m erch a n d ise group, an d w o m e n ’s
read y-to -w ear stores.
8 C ov ers o n ly a u to m o tiv e , ch em ica ls an d drugs, d ry good s an d ap p arel, electrica l e q u ip m e n t, farm p rod
u cts, farm su p p lies, a n d food p rod u cts.
10 S ee ta b le 3, footn ote 13.
The largest percentages of workers dealt with on an individual
basis were found in wholesale trade (94.6 percent), service industries
(86.0 percent), and retail trade (73.0 percent). The smallest propor
tion was in mining (9.9 percent); public utilities were next in rank,
although the firms reporting in this group had over two and a half
times as large a percentage of workers in individual-dealing establish
ments as mining. The average for the manufacturing industries, with
42.5 percent of the employees in such establishments, fell between
these two extreme groupings. The percentage of employees in manu
facturing establishments dealing with employees individually was
exactly the same as that in the entire sample.
In terms of the percentage of workers in establishments dealing
with some or all workers through trade-unions alone, the mining indus
try with 87.2 percent ranked highest. Wholesale trade, with 5.0
percent covered by this type of dealing, was lowest. In manufactur
ing, 24.1 percent of the workers were in establishments with tradeunion dealings.
The percentage of workers in establishments with company unions
alone or with company-union and trade-union dealings jointly was
largest in manufacturing as a whole, where 24.9 percent of the em
ployees were in establishments of the first type and 8.5 percent in
TYPES OF EMPLOYER-EMPLOYEE DEALING
39
establishments with both types of dealing. Public utilities was
the next highest group, with 15.2 percent of the employees in establish
ments which dealt through company unions. Public-utility estab
lishments with both company unions and trade-unions employed 6.8
percent of the workers covered. Establishments with trade-union
dealings alone had about two and a half times as many employees as
those with the two types of dealing combined.
Retail trade was the only other major field in which company-union
dealings covered a significant proportion of the employees; 5.8 percent
of the employees in the firms reporting were in establishments with
company unions alone, and 9.7 percent were in establishments with
both company-union and trade-union dealings.
In the manufacture of durable goods, the relative number of
workers in establishments dealing through a company union alone
was more than twice as large as in those dealing through a trade-union.
The proportion of workers in plants dealing only through company
unions was almost as large as that in establishments dealing on an
individual basis. In nondurable goods, the proportion of workers in
establishments dealing on an individual basis was 45.5 percent, as com
pared tQ 30.8 percent in establishments dealing with trade-unions
alone, 16.0 percent in establishments with company unions only, and
7.7 percent in plants with both company unions and trade-unions.
Thus in nondurable goods, establishments dealing with trade-unions
alone employed nearly twice as many workers relatively as those with
company unions only, and about one-third more workers than did
all establishments reporting company unions.
Comparison of Workers Covered by Trade-Union and
Company-Union Dealing
Of the 2,866 establishments dealing through trade-unions but
without company unions, 2,579, or 90 percent, having a similar
percentage of employees, indicated in their replies the proportion of
their workers who were specifically covered by trade-union dealings.
In 10 percent of the cases no information is available regarding the
proportion of workers covered by trade-union dealings. Table 3
(p. 42) shows the estimated total trade-union coverage in those spe
cific industries in which data covered 75 to 100 percent of the workers
in the establishments reporting trade-union dealing. In some indus
tries definite replies on union coverage were too few to permit any sub
division; in others, a tentative subdivision on the basis of returns which
are only partially satisfactory is carried in footnotes to table 3. These
data are included, however, in arriving at the estimates of the tradeunion coverage in the various industry groups shown in table 2. For
reasons indicated earlier, no attempt has been made to estimate the
number of workers covered by trade-union dealings in establishments
CHARACTERISTICS OF COMPANY UNIONS
40
having both trade-unions and company unions. The term “ tradeunion coverage” is therefore used here as applying only to the coverage
in those establishments which deal with trade-unions but not with
company unions.
For all industries, the data indicate that, on the average, 86.6 per
cent of the workers in establishments which dealt through a tradeunion were covered by trade-union dealings. Thus, while 584,466
workers, or 30.2 percent of the total covered in this survey, were in
establishments which dealt with some or all of their workers through
trade-unions, 505,211, or 26.1 percent, were actually in departments
or occupations covered by trade-union dealing. The remaining 79,255
workers were reported as dealing with their employers on an individual
basis. Excluding those establishments in which both a company
union and a trade-union existed, trade-union dealing alone involved
almost one-third more workers than company-union dealing alone in
the firms reporting
T ypes of Employer- E mployee Dealing
INDIVIDUAL
w/ymm
(9 5
TRADE UNION
30.2
COMPANY UNION
I
0.6
PARTLY TRADE UNION
PARTLY COMPANY UNION
%
74
I ESTABLISHMENTS
WORKERS AFFECTED
EMPLOYEES IN TRADE UNION ESTABLISHMENTS
B U T NO T COVERED BY TRADE U N IO N DEALING
In manufacturing industries, one-quarter of the workers were in
establishments with company unions only, and one-fifth of the workers
were specifically covered by union arrangements in firms without com
pany unions. In addition 8.5 percent of the workers were in estab
lishments with both company-union and trade-union dealing. The
situation in durable goods, however, was quite different from that in
nondurable goods. In the former, trade-unions functioning in estab-
TYPES OF EMPLOYER-EMPLOYEE DEALING
41
lishments where no company unions existed covered 12.2 percent of
all the workers. In contrast, 34 percent of the workers in the du
rable-goods industries were in establishments with a company union
only and another 9.4 percent in establishments with both types of
dealing. In nondurable goods, trade-union dealing specifically cov
ered 26.1 percent of the workers, while company-union dealing was
carried on in establishments with 23.7 percent of the workers. Of
these, one-third were in establishments which dealt with trade-unions
as well as company unions.
In the durable-goods industries only the stone, clay, and glass prod
ucts group showed a larger figure for specific trade-union coverage
than for company-union coverage. This condition holds even if there
be added to the company-union coverage employees in those estab
lishments also dealing with trade-unions. In the nondurable-goods
group, on the other hand, trade-union coverage was more extensive
than the coverage of company unions (both with and without tradeunion dealings) for every group except chemicals and rubber products.
Separation of the textile group into fabrics and wearing-apparel
subgroups reveals the lack of uniformity in industrial-relations prac
tices in the textile group. The main difference between the two sub
groups lies in the preponderance of individual dealing in the fabrics
group and preponderance of trade-union dealing alone in the wear
ing-apparel industry. In neither subgroup were 10 percent of the
employees in establishments with any form of company-union dealing.
With 54.6 percent of all workers covered by trade-union deal
ing, the wearing-apparel group showed the highest figure for tradeunion coverage among the manufacturing industries. Among these
industries, the lowest figures for trade-union coverage were found in
machinery, rubber products, and lumber and allied products.
The largest proportion of workers in establishments with company
unions alone was (disregarding the miscellaneous manufacturing group)
in chemicals, with 54.9 percent. In addition to this were 5.7 percent in
establishments with company unions and trade-unions. Next in rank
came iron and steel, with nearly 50 percent of the workers in establish
ments dealing only through company unions and with 8 percent more
in establishments with company unions but also with some trade-union
dealings. Then followed transportation equipment4 and machinery.
In rubber products, nearly two-thirds of the workers were in estab
lishments with both a company union and a trade-union and about
13 percent were in establishments with company unions alone. Nearly
one-fourth of all the workers in establishments with dual bargaining
agencies were in the rubber-products group. Other industries in
which such situations involved 10 percent or more of the workers were
transportation equipment, food, and machinery.
4
S ee fo o tn o te 3 (p . 36).
154875°— 38— 4
T able 3.— Method of dealing with employees, by industry, April 1985
P ercen ta ge of w orkers in esta b lish m en ts dealing—
N u m b er o f esta b lish m en ts d ealing—
A ll in d u stries c o v e r e d _______________________________________________
A ll m an u factu rin g in d u stries__________________________ ___________
D u ra b le good s-------------------------------------------------------------------Iron a n d ste e l a n d th eir p rod u cts, n o t in c lu d in g m a
ch in ery i ---------------------------------------------------------------------------B la st furnaces, ste e l w ork s, a n d rollin g m ills i _______
B o lts, n u ts, w ash ers, a n d r iv e ts___ _____ ___
C ast-iron p ip e
______
__ ______ ___ __ C u tlery (n o t in c lu d in g silv er an d p la te d cu tlery)
an d ed ge to o ls___ _______ _______________________ _____
F orgin gs, iron an d ste el____________ ______________ __
H a rd w are ____
S team - a n d hot-w a ter h ea tin g ap p aratu s an d steam
fittin g s
__ ____
_
_____ __
S to v e s------------. __ ________________
________
S tru ctu ral a n d orn a m en tal m eta lw o rk _
T o o ls (n ot in clu d in g edge tools, m ach in e tools, files,
an d sa w s)_____________________________________________
__
W irew ork i_ _ _ _
_
M iscella n eo u s. _ _________ ______
________ __
M a ch in ery , n o t in clu d in g tra n sp o rtation eq u ip m e n t-----A gricu ltu ra l im p le m e n ts. _
C ash registers, a d d in g m ach in es, an d calcu latin g
m ach in es .
__
. . .
E lectrical m ach in ery, ap p aratu s, an d su p p lie s.. . . .
E n g in es, tu rb in es, tractors, an d w ater w h eels
F o u n d r y a n d m ach in e-sh op p rod u cts____ _________
M a ch in e to o ls__ __ ______ .
. . ________
R a d io s a n d phon ograp h s
__ _ _ _______
T e x t il e m a c h i n e r y a n d p a r ts
T y p ew riters an d p a rts----------- -------------------------------------
14, 725
9,854
4,279
721
51
25
11
98
49
35
35
99
122
68
67
51
1, 493
40
15
200
61
962
86
19
107
3
W ith
so m e or T h rou gh
all
w ork ers pcoa mn y
th rou gh u n io n
tradeu n io n
11,267
7,268
3,467
556
21
23
8
2,866
496
2,069
532
445
247
62
21
2
2
89
40
31
7
2
2
6
40
315
27
48
3 H2
58
59
40
1,251
33
11
<150
49
5 815
82
14
96
1
94
7
3
4
8
136
1
< 20
2
3 96
2
3
11
1
2
5
2
2
8
5
6
4
3
95
7
2
28
8
47
2
I
o ta l
T h rou gh wTorkers
c o m covered
pany
In d iv id
y
u n io n repb lies
u a lly
an d
tradeu n io n
96 1,935,673
72 1,428,613
33 649,536
9 108,555
2 51,492
2,949
I
2,011
5,353
5,050
2
6,146
4, 652
3 10, 755
4, 274
42.5
42.5
39 .8
29.1
6 .0
75.1
56 .9
79.2
26.6
46 .9
56.1
19.7
3 70.0
6,447
4,744
4, 682
266, 291
18,819
14,017
78,505
31, 791
84,578
7,052
18,944
7, 447
5,138
36.5
70.3
70.5
39.6
29.0
54.3
< 25.2
33.4
1 5 4 .4
95 .0
7 .9
91.1
1
11
1
2
2
4
2
2 2 .1
W ith sc •me or all w orkers
throu Lgh trade-i an ion
T o ta l
T h ro u g h
T h rou gh pcom
any
E sti
co m
E sti
u
n
io
n
pany
m ated m a ted
an d
percent percent u n io n
tradecovered n o t c o v
u
n io n
ered b y
by
u n io n
u n io n
30 .2
2 6 .1
4.1
24.1
16.8
1 9 .5
12.2
4J
4.6
13.6
10.9
10.6
10.1
3 .0
6 .3
.4
6 .7
4 .4
.7
14.5
53.3
3 1 3 .4
5 .5
6 .6
18.8
10.8
.4
<11.8
1.6
6 6 .8
1.5
46.7
8 .9
68.7
3 .7
(?)
.8
(2)
.7
9 .1
5 .4
3 6 .4
1 6 .9
9 .0
5 .1
4-4
•4
2.8
3 .8
13.1
5 .7
7 .0
3 .8
.4
8.0
3 .8
1 .6
S .4
1 .5
S .4
19.9
24.9
34.0
49.3
74.0
24.9
35.9
14.1
62.6
52 .4
29.4
20.7
16.6
14.9
23.1
10.7
39.6
71.0
36. 7
48 .8
50.5
37 .8
3.5
4 6 .7
3 .0
2.3
6 .9
6 6 .4
9 .2
7.4
&5
9 .4
8 .0
9. 1
7 .2
6 .4
6.3
43.1
10.0
8 .6
14. 2
14. 5
1.0
45.4
CHARACTERISTICS OF COMPANY UNIONS
In d u stry
T o ta l
esta b
lish
m en ts
covered In d iv id
u a lly
by
replies
20
1
14
5
40
10
9
2
4
9
6
95
40
41
14
147
11
3
45
60
23
1 ,5 2 2
535
142
5
28
4
13
34
11
20
27
366
112
229
2
13
10
27
61
48
13
332
96
53
7
122
2
22
3
16
1
2
19
9
3
1
1
4
1
30
11
4
15
19
7
7
3
1
2
2
1
1
2
1
i
6
6
2
3
188
44
31
11
1
3
8
2
3
3
13
8
2
1
2
16
11
5
22
8
35
9
6
2
1
1
1
1
3
1
1
1
10
1
3
2
1 9 .9
1 .5
2 0 .5
9 3 ,0 8 2
7 ,5 1 7
70, 437
3 ,8 0 1
11, 327
56, 582
21, 823
9 , 065
6 , 323
3 , 699
4 . 461
8 , 21 0
3 , 001
7 7 , 428
2 7 ,1 4 7
2 0 .7
5 4 .9
1 5 .0
52. 6
2 2 .4
5 8 .2
7 1 .9
6. 5
7 6 .4
9 5 .8
1 9 .0
6 6 .1
6 6 .6
7 4 .9
7 6 .7
1 6 .1
4 .2
5 8 .0
21. 7
2 5 .1
1 1 .3
1 1 .3
1 2 , 789
3 7 , 492
4 7 , 598
6 ,0 0 8
3 , 707
2 1 , 510
2 , 757
13, 616
75 5 , 744
32 9, 818
25 0, 434
5 , 847
103, 875
6 ,9 0 1
1 2 ,0 5 4
3 8 ,6 8 5
11 ,8 3 1
2 2 ,1 2 5
4 9 ,1 1 6
7 4 ,4 5 2
3 8 ,9 5 6
1 9 ,0 7 5
3 ,0 2 2
3 , 502
9 ,8 9 7
4 ,9 3 2
5 1 ,8 0 9
3 9 ,9 1 6
1 1 ,8 9 3
9 8 6 , 586
1 9 ,9 2 9
6 ,1 2 5
2 , 543
1 2 ,9 7 7
1 1 ,3 3 8
7 0 .0
7 5 .3
2 2 .7
73. 7
5 0 .3
5. 8
4 7 .0
14. 4
4 5 .5
6 0 .7
6 8 .1
2 1 .6
7 4 .8
7 5 .7
5 9 .8
3 8 .9
9 4 .7
6 2 .0
7 9 .6
3 7 .5
2 7 .5
3 4 .0
6 3 .1
6 4 .5
6 5 .8
3 8 .5
3 6 .9
3 4 .2
4 5 .8
9 45. 3
6 0 .9
3 3 .1
7 9 .2
2 .4
8 4 .7
2 5 .9
6 .3
6 3 .5
1 6 .5
1 3 .8
7 6 .7
4 7 .6
8 0 .0
3 0 .8
3 0 .8
2 2 .7
7 8 .4
1 4 .9
2 1 .2
2 6 .5
4 5 .2
4 .4
3 2 .3
14 5
5 5 .9
6 5 .2
6 2 .2
2 0 .5
3 5 .5
2 5 .4
6 1 .5
4 5 .4
5 3 .8
1 7 .6
9 35. 7
2 6 .2
6 6 .9
9 .2
9 7 .6
6 .5
3 5 .4
1 4 .8
9 .6
3 .0
1 6 .9
.7
.8
1 6 .7
3 .8
8 5 .0
.4
11.8
3 .0
7 .4
2.2
11.1
5 .0
3 .5
1 1 4
7 .8
1 7 .2
7 .9
8.8
2 .5
8 .5
2.8
8.4
1 7 .5
a
4 2 .4
1 6 .1
(8a)
2 1 .1
.4
1 8 .7
.1
8 4 .6
42.1
8 6 .7
1 0 .9
7 6 .2
3 .8
2 6 .1
4 .7
2 8 .1
2 .7
1 9 .6
8 .1
7 7 .0
1 .4
1 1 .4
1 8 .0
8 .2
1 8 .9
7 .6
8 .5
4 3 .7
1 .6
4 .3
.1
2 6 .8
5 .5
1 2 .4
2 .1
5 4 .6
1 .3
6 5 .0
.2
5 8 .5
3 .7
1 8 .8
1 .7
(3 b)
c
(8 )
8
8
( b)
( c)
7 .7
3 5 .8
9 .6
4 1 .4
1 2 .4
92 8 . 6
17.1
97 .1
1 9 .7
6 .5
5 5 .8
11.1
.5
7 .8
1 .9
9 1 .7
5 .9
( 2)
2 3 .0
1 1 .9
8 .3
1 2 .1
9 .4
4 .1
1 6 .7
5 .9
9 .8
3 5 .9
4 .0
2 4 .8
.3
1. 7
2 .6
1 .7
7 .9
1 7 .5
5 .4
5 .6
1 6 .0
6 .3
6 .7
8 .0
3 .1
5 .8
1 4 .3
.9
3 .8
2 .1
5 .4
6 .9
1 .9
16. 4
4 .5
6 3 .8
( 2)
1 9 .7
10. 2
2 5 .0
.7
5 8 .0
(8 )
3 9 .7
3 3 .4
3 9 .5
4 7 .4
4 2 .2
2 3 .0
18. 5
68. 7
7 .5
17. 7
1 2 .0
36. 6
9 8 .0
1 2 .9
7 .7
2 .2
2 .5
2 .3
7 .9
1 .6
1 .9
3 .8
1 .2
.4
1 .9
4 .3
9 1 1 .6
1 1 .6
8 .1
.7
T Y P E S O F E M P L O Y E R -E M P L O Y E E D E A L IN G
T ran sp orta tio n e q u ip m e n t 6 ...................................................
A ircraft____________________________________________
A u to m ob iles 7_____________________________________
L o co m o tiv es______________________________________
S h ip b u ild in g i _____ _______________________________
N on ferrou s m e ta ls a n d th eir p r o d u c ts_______________
B rass, bronze, a n d cop p er p r o d u c ts_____________
C lock s a n d w a tch es a n d tim e-recording devices.
J e w e lry ____________________________________________
Silv erw are a n d p la te d w a r e ______________________
S m eltin g a n d refin in g— copper, lead , an d z in c ..
S tam p ed a n d en a m eled w a re-----------------------------M iscella n eo u s_____________________________________
L u m b er an d allied p r o d u c ts__________________________
F u rn itu re__________________________________________
L um ber:
M ill w o r k ______________________________________
S a w m ills______________________________________
S ton e, clay , an d glass p ro d u cts 1_____________________
B rick , tile , a n d terra c o tta _______________________
C e m e n t1___________________________________________
G la ss_______________________________________________
M a rb le, g ra n ite, sla te , a n d oth er p rod u cts______
P o tte r y ____________________________________________
N on d u ra b le g o od s_________________________________________
T e x tile s an d th eir p r o d u c ts__________________________
F ab rics (ex cep t h a ts)_____________________________
C arp ets a n d r u g s_____________________________
C o tto n go od s__________________________________
C o tto n sm a ll w a res___________________________
D y e in g an d fin ish in g te x tile s________________
H o sie r y ________________________________________
K n it go od s____________________________________
Silk a n d r a y o n g o od s_________________________
W oo len an d w o rsted g o o d s__________________
W earing ap p arel (ex cep t m illin e r y )_____________
C loth in g, m e n ’s _______________________________
C loth in g, w o m e n ’s ___________________________
C orsets a n d a llied g a r m en ts_________________
M e n ’s fu rn ish in g s____________________________
Sh irts a n d co lla rs_____________________________
M iscella n eo u s_____________________________________
L eath er an d its m a n u fa ctu res________________________
B o o ts an d sh o es___________________________________
L eath er____________________________________________
F o o d an d k in d red p rod u cts e_________________________
B a k in g _____________________________________________
B ev erag es__________________________________________
B u tte r _____________________________________________
B rew eries__________________________________________
C on fection ery..................... ............... .....................................
S ee footn otes a t en d o f ta b le.
T
a b l e 3 . — Method
of dealing with employees, hy industry, April 1935— Continued
P ercen tage of w orkers in e sta b lish m e n ts d ealin g—
N u m b er of esta b lish m en ts d ealin g—
In d u stry
180
95
114
22
6
96
1,388
196
161
168
72
80
22
5
62
824
182
99
723
308
578
524
61
47
42
12
105
182
13
62
54
70
426
117
490
467
45
47
41
52
18
42
22
85
899
537
7
104
165
1
57
23
51
9
11
56
798
471
o ta l
T h ro u g h Torkers
W ith
so m e or T h rou gh c o m wcovered
a ll
pany
In d iv id
y
w orkers co m
u n io n repb lies
u a lly
th rou gh upnaion yn
an d
trad e tradeu n io n
u n io n
8
20
23
1
34
518
7
4
3
3
45
7
36
26
285
190
23
17
2
11
1
54
37
13
1
1
1
6
4
2
6
8
4
4
11
15
95
62
8
1
1
11
3
1
4
10
7
3
17
7
6
1
10
5
3
1
1
8
4
4
4
1
1
W ith so m e or all w orkers
throu igh trade-i an ion
T o ta l
5,328
2,036
9 22, 248
1,080
2,978
10,564
111, 748
11,612
51,922
71.0
67.2
9 24. 7
100. 0
46. 3
74.0
37.8
79.8
35.4
12.8
28.7
9 22. 9
25,625
22, 589
105,626
73,172
17,138
1,959
2,751
2,749
8,056
8,752
26,832
4,935
32, 454
53,109
42.8
16.0
25.4
34.7
29.4
100.0
95.8
15.8
97.9
64.6
.2
35.2
4.5
12.5
51.3
79.4
14.0
14.3
2.8
11, 644
41,465
6,484
23,333
50, 586
27,007
39.5
4.9
28.7
22.3
86.0
85.7
10.5
8.3
71.3
9.6
11.6
11.5
53.7
26.0
44.8
9.5
34.4
4.2
1.7
2.1
4.0
34.7
.5
13.0
8.8
T h rou gh
T h ro u g h pcom
any
E sti
E sti
co m
u
n
io
n
m a ted m a ted
pany
an d
p ercen t p ercen t u n io n
trad ecovered n o t c o v
u n io n
ered b y
by
u n io n
u n io n
(8d)
(8d)
17 .1
U 2 .6
1 1 .6
91 0 .8
16.2
4.1
9 9. 8
9 42. 6
5 8 .7
2 5 .0
1 .0
8 3 .4
1 1 .4
1 .8
7 .7
2 5 .5
8 .9
8 7 .4
1 8 .9
6 8 .0
1 6 .4
1 8 .0
1 .0
1 8 .8
(2)
(°)
1 .0
(8«)
16.8
10.7
30.2
.6
3.5
4.6
54.9
49.2
63.4
2.4
5.7
1. 8
4.4
4 .2
82.5
1 .7
(8d)
2.1
1 .6
2 .4
8 4 .1
.6
.1
.4
1 1 .5
1 .5
7 .2
1 .6
8 .0
(8.)
2 .5
(8.)
(8d)
27.8
64.3
64.3
67.8
13.1
3.6
.8
14. 7
65.6
50.0
2.7
84.1
59.0
2.3
2.6
9.1
.1
.2
7 1 .8
7 .7
1 .9
6 .4
5 .2
8 .5
8 .0
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
A ll m an u fa ctu rin g in d u stries— C o n tin u ed .
N o n d u ra b le goods— C on tin u ed .
F o o d an d k in d red p ro d u cts— C on tin u ed .
F lou r
..............
Ice cream
__ _
________
S lau gh terin g a n d m e a t p a ck in g 9................. ..........................
Sugar, beat
Sugar refining, cane
C igars. _ __________________________________ _____ ________
P ap er an d p r in tin g -------------------------------------------------------------B oxes, p a p er____________________________________________
P aper an d p u lp ................................ ........................................ ..
P rin tin g an d p u b lish in g:
B o o k an d jo b _______________________________________
N ew sp a p ers an d p eriod icals_______________________
C h em ica ls a n d a llied p rod u cts, a n d p etro leu m refin in g .
O ther th a n p etro leu m refin in g ______ ___________________
C h em icals___________ _______________________________
C o tto n seed — oil, cak e, a n d m eal
____
D ruggists* p rep aration s___________________ _______
E x p lo siv e s__________________________________________
F e r tiliz e r s9__________________________ ______________
P a in ts a n d varn ish es ........................................................
R a y o n a n d a llied p r o d u c ts________________________
S o ap ____ _______ ____ _____ ________________________
P etroleu m refin in g_____________________________________
R u b b er p rod u cts (ex cep t b o o ts a n d sh o es)____ ___________
R u b b er goods, oth er th a n b o o ts, sh o es, tires, an d
tu b es_____________________
....
_______
R u b b er tires a n d in n er tu b e s___________ _______ ______
M iscellan eou s n o n d u rab le goods
_____________________
M iscellan eo u s m a n u fa ctu res____________ ______ _____ _________
S ervice...................................................... ...................... ..................................................
L a u n d ries..................................................................................................................
T o ta l
estab
lish
m en ts
covered In d iv id
u a lly
by
replies
W h olesale trade 11_______________________
F o o d p r o d u c ts______________________
A ll excep t food p rod u cts 12_________
145
217
285
49
143
93
967
498
17
54
398
1,398
508
712
178
1,322
367
955
119
208
184
42
112
30
450
46
40
364
1,300
450
674
176
1,267
333
i3 934
24
9
, 72
2
16
54
505
448
17
8
32
76
44
32
49
33
13 16
2
20
3
13
4
10
4
5
1
10
3
5
2
6
1
5
9
2
2
5
2
1
1
12
11
1
4,604
18,975
111, 236
11, 588
46,075
53, 573
185,035
139, 264
19,963
12, 736
13,072
133,131
23,876
101, 563
7,692
27,072
7, 771
19, 301
65.3
91 .7
27.4
42.3
51.3
3 .7
9 .9
1.8
37.6
85 .0
73.0
45.0
78.2
92. 2
94.6
86. 5
13 97. 8
25.0
8 .3
50.6
13.0
19.8
85.1
87.2
97.1
100. 0
34.9
12.9
11.4
4 .6
13.9
5 .0
13. 2
13 1.8
1 6 .3
8 .7
l.A
6 .9
4.7.7
2 .9
1 2 .7
.3
14.0
5 .8
8 3 .5
1 .6
8 6 .6
.6
9 6 .6
.5
1 0 0 .0
3 4 .2
.7
1 0 .2
2 .7
.9
1 0 .5
2 .2
2 .4
1 3 .2
.7
3 .5
1 .5
9. 8
3 .4
.9
.9
9 .7
15.2
31.1
23.3
4 .9
2 .4
1.1
21.4
.7
5.8
2.2
6 .5
7.8
.4
.3
.4
6.8
13.6
5 .6
6 .3
.5
6.1
1.4
9 .8
48 .2
1.4
° L ess th a n H o o f 1 p ercen t.
1 See te x t fo o tn o te 2 (p. 33).
2 R ep lies w ith d efin ite in form ation concern ing trade-union coverage w ere too few to in d ica te th e d istrib u tio n for all th e e sta b lish m e n ts rep ortin g u n io n dealin g.
3 14 esta b lish m e n ts, w ith 181 w orkers, w h ich engaged b o th in th e fab rication an d th e erectio n of certain steel stru ctu res rep orted d ealin g in d iv id u a lly w ith th eir sh o p w orkers
an d th ro u gh a trad e-u n io n w ith th eir con stru ctio n w orkers. Since th is stu d y d oes n o t cov er co n stru ctio n w orkers an d sin ce o n ly sh o p w orkers are in c lu d e d in th e n u m b er o f w ork ers,
th ese esta b lish m e n ts are classed here as d ealin g on an in d iv id u a l basis.
4 1 e sta b lish m e n t, w ith 6 w orkers, p resen ted th e sam e situ a tio n as in d ica ted in th e p reced in g n o te.
3 3 e sta b lish m e n ts, w ith 76 w orkers, p resen ted th e sam e situ a tio n as in d ica ted in n o te 3 ab ove.
6 See te x t fo o tn o tes 2 an d 3 (p p . 33, 36).
7 See te x t foo tn o te 3 (p . 36).
8 R ep lies g iv in g d efin ite in form ation regarding un ion coverage d id not p ro v id e an en tir e ly ad eq u a te b asis for e stim a tin g th e percen tage of w orkers covered b y u n io n d ealin g . T h e
coverage in d ica ted b y th e rep lies received follow s:
(а ) 12 rep lies, cov erin g 69.2 p ercen t o f th e w orkers in trade-union-dealing e sta b lish m e n ts, in d ica te th a t 6.3 p ercen t are covered b y tra d e-u n io n s an d less th a n H o of 1 p ercen t are
n o t covered.
(б ) 12 rep lies, cov erin g 65.2 p ercen t o f th e w orkers in trade-union-dealing esta b lish m e n ts, in d ica te th a t 32.1 p ercen t are cov ered b y tra d e-u n io n s a n d 2.4 p ercen t are n o t cov ered .
(c) 7 rep lies, cov erin g 60.6 p ercen t o f th e w orkers in trade-union-dealing e sta b lish m e n ts, in d ica te th a t 24.0 p ercen t are cov ered b y tra d e-u n io n s a n d 1.4 p ercen t are n o t co v er e d .
( d ) 4 rep lies, cov erin g 2 8 .7 p ercen t o f th e w orkers in trade-union-dealing e sta b lish m e n ts, in d ic a te th a t 9.3 p ercen t are covered b y tra d e-u n io n s a n d 3.5 p ercen t are n o t co v ered .
2 oth er rep lies, acco u n tin g for a n a d d itio n a l 47.5 p ercent o f th e w orkers in tra d e-u n io n -d ea lin g e sta b lish m e n ts, sta te d th a t “ a m a jo r ity ” of th eir w ork ers w ere cov ered b y tra d e-u n io n s.
( e ) 3 rep lies, co v erin g 78.9 p ercen t o f th e w orkers in trade-union-dealing e sta b lish m e n ts, in d ica te th a t 7.0 p ercen t are covered b y tra d e-u n io n s a n d 1.3 p ercen t n o t co v ered .
9 A la te r ep ly from a large p a ck in g -co m p an y chain, w h ich does n o t g iv e th e situ a tio n in th e sep arate e sta b lish m e n ts, in d ica tes th a t th e figu res for c o m p a n y -u n io n d ea lin g a n d
for com b in ed co m p a n y -u n io n an d tra d e-u n io n dealin g in slau gh terin g an d m e a t p a ck in g sh o u ld b e hig h er th a n is here in d ica ted . T h e effect u p o n th e p ercen tag e figu res for sla u g h te rin g
a n d m ea t p a ck in g w o u ld a p p a ren tly b e to increase th e com b in ed percentage figu re for d ealin g th ro u g h a c o m p a n y u n io n a n d th ro u gh b o th a c o m p a n y u n io n a n d a tra d e-u n io n to 64.1
p ercen t, to red u ce th e figure for trad e-u n io n d ealin g to 14.0 percent, an d to red u ce th e figure for in d iv id u a l d ealin g to 27.9 p ercen t. T h e corresp on d in g corrected p ercen tag es for th e
food group w o u ld b e 27.9 p ercen t, 30.7 p ercen t, an d 41.4 p ercen t. T h e effect u p o n th e to ta ls for th e n on d u rab le goods in d u stries w o u ld be n eglig ib le.
9o E x clu d in g telep h o n e an d teleg ra p h an d railroads. See ch. IV .
10 C overs o n ly reta il grocery, m ea t, an d produce stores; th e general m erch an d ise group; an d w o m e n ’s read y-to-w ear stores.
11 C overs o n ly a u to m o tiv e , ch em ica ls an d drugs, d ry goods and apparel, electrica l e q u ip m e n t, farm p rod u cts, farm su p p lies, an d food p rod u cts.
18 See foo tn o te 11 ab ove.
13 2 esta b lish m en ts w ith 57 w orkers engaged in b o th sellin g and in stallin g electrica l e q u ip m e n t raised th e sam e p rob lem as in d ica ted in n o te 3 a b ove an d w ere accord in g ly classed
w ith in d iv id u a l-d ea lin g estab lish m en ts.
,
Cn
TYPES OF EMPLOYER-EMPLOYEE DEALING
D y e in g an d clea n in g ..........................
H o te ls_______________________________
P u b lic u tilitie s 9®________________________
M an u fa ctu red ga s__________________
E lectric lig h t an d p o w er___________
E lectric railroad an d m o torb u s____
M in in g ___________________________________
C oal m in in g — b itu m in o u s_________
C oal m in in g — a n th ra cite___________
M eta lliferou s m in in g _______________
Q u arrying an d n o n m eta llic -----------R e ta il tr a d e 10____________________________
G rocery, m ea t, an d prod u ce stores.
G eneral m erch a n d ise g ro u p _______
W o m e n ’s rea d y-to -w ear____________
CHARACTERISTICS OF COMPANY UNIONS
46
Size of Establishment and Method of Dealing
Of the establishments which reported individual dealing, 83.6
percent had fewer than 100 workers (table 4). These smaller plants,
however, employed only 27.6 percent of the workers in establishments
which were reported as having no agency for collective dealing (table
5). Over two-thirds of the workers in establishments handling labor
relations on an individual basis were in plants with fewer than 500
workers.
T
able
4.— Distribution of establishments dealing with employees by method indi
cated, by size of establishment April 1935
E sta b lish m e n ts d ealin g—
S ize of e sta b lish m en t
T o ta l esta b
lish m e n ts
In d iv id u a lly
W ith som e
or all
w orkers
th ro u gh
trad e-u n ion
T h ro u g h
co m p a n y
u n io n
T h rou gh
co m p a n y
u n io n an d
trad e-u n ion
N u m P er N u m P er N u m P er N u m P er N u m P er
ber cen t ber cen t ber cen t ber cen t ber cen t
A ll e sta b lish m e n ts______________________
l to 49 w o rk ers______________________ . .
50 to 99 w ork ers___________ _____________
100 to 199 w ork ers____________ _________
200 to 499 w o rk ers. . ____________ ______
500 to 999 w ork ers_______ . . . _________
1,000 to 2,499 w ork ers__________________
2,500 to 4,999 w ork ers___________________
5,000 w orkers an d o v e r.
___________
14, 725 100.0 11, 267 100.0 2,866 100.0
9, 394 63.8 7,987 70.9 1, 345 46.9
1,937 13.1 1,428 12.7 453 15.8
1,424 9 .7
388 13.5
939 8.3
1,220 8 .3
663 5.9 403 14.1
162 5.7
430 2.9
171 1.5
.6
225 1.5
63
90 3 .2
.1
70
14
21
.7
.5
_2
25
2 0)
4
.1
496 100.0
57 11.5
53 10.7
82 16. 5
134 27.0
73 14.7
56 11.3
29 5.9
12 2.4
96 100.0
5 5.2
3 3.1
15 15.6
20 20.8
24 25.0
16 ' 16.7
6 6 .3
7 7.3
1 L ess th a n H o of 1 p ercen t.
Establishments with fewer than 100 workers constituted 62.7 per
cent of the establishments dealing with trade-unions (table 4), but
employed about 10 percent of the workers in such establishments
(table 5). Nearly two-thirds of the workers in establishments han
dling all or part of their labor bargaining through trade-unions were in
plants with from 200 to 2,500 workers (table 5), although only slightly
more than one-fifth of the trade-union-dealing establishments fell in
this group (table 4).
The largest single group of establishments with company unions
alone comprised units with from 200 to 499 workers (table 4). From
the standpoint of number of workers, however, the largest single
company-union group was composed of plants with more than 2,500
but fewer than 5,000 workers. This group contained over one-fourth
of the workers in plants with company unions but with no trade-union
dealing (table 5). Over 80 percent of the workers in plants with
company unions alone were in establishments with more than 500
workers (table 5). These establishments included approximately
one-third the number that reported company unions only (table 4).
TYPES OF EMPLOYER-EMPLOYEE DEALING
47
The upward trend in size which is noticeable in moving from indi
vidual dealing through trade-union dealing to company unions con
tinues with the group of establishments which carry on their industrial
relations through both a company union and a trade-union. Here
the largest single group in terms of establishments was the class with
T ypes
of
Dealing
with
E mployees
in
Establishments
of
Different Sizes
ESTABLISHMENTS EMPLOYING
1 -4 9
50-99
100-/99
200-499
500-999
1000-2499
2500-4999 5000
k
$
I in d iv id u a l B a s is
W /A
Trade Union
Company Union
Partly Trade Union
Partly Company Union
from 500 to 999 workers (table 4). From the point of view of number
of workers covered, the most significant group under this type of dual
dealing consisted of the very large establishments, those with over
5,000 workers (table 5). Plants with more than 1,000 workers ac
counted for over 80 percent of all the workers in establishments with
both a company union and a trade-union.
48
CHARACTERISTICS OF COMPANY UNIONS
T able 5. — Distribution of workers in establishments dealing with employees by
method indicated, by size of establishment, April 1935
W orkers in esta b lish m en ts d ealin g—
T o ta l w orkers
S ize o f esta b lish m en t
W ith so m e or
T h rou gh co m
orkers T h rou gh co m p a n y u n io n
In d iv id u a lly tharoll uwgh
trade- p a n y u n io n
an d tradeu n io n
u n io n
P er N u m P er N u m P er - N u m P er N u m P er
N u m b e r cen
ber
ber
ber
cen t
cen t
cen t
ber
t
cen t
A ll e sta b lish m e n ts_______ __ 1,935,673
1 to 49 w o rk ers______________ 155, 484
50 to 99 w o r k e rs. _________ 136, 583
100 to 199 w o rk ers___________ 200, 137
200 to 499 w ork ers. ________ 375, 943
500 to 999 w o rk ers___________ 294, 050
1,000 to 2,499 w ork ers_______ 339, 758
2,500 to 4,999 w o rk ers_______ 235, 471
5,000 w orkers an d o v e r _____ 198, 247
100.0
8.0
7 .1
10.3
19.4
15. 2
17. 6
12. 2
10.2
822,674
126, 333
100, 035
131, 067
199, 473
113, 430
90, 716
44, 983
16, 637
100.0
15.4
12.2
15.9
24 .2
13.8
11.0
5 .5
2.0
584, 466 100.0 385,954
27,409 4 .7
1, 599
32, 273 5 .5 4,064
54, 389 9 .3 12, 510
125, 698 21 .5 41,050
109, 805 18.8 53, 239
134, 779 23. 1 89, 295
71, 375 12. 2 101, 633
28, 738 4. 9 79, 564
142, 579
100.0
143
211
1.1
3 .3
2,171
11 .4 6 , 722
13.8 17, 576
23. 1 24, 968
26. 3 17, 480
20. 6 73, 308
.1
.2
1 .5
4 .7
12. 3
17. 5
12. 3
51 .4
100.0
.4
The effect of size of plant upon method of dealing is apparent also
from the distribution of the establishments within each size class
according to the method of employer-employee dealing (table 6).
Of the very small establishments, 85.0 percent dealt on an individual
basis, 14.3 percent on a trade-union basis, and less than 1 percent under
any form of company union. As an example of an intermediate size
class, the group with from 500 to 999 workers showed 39.8 percent of
the establishments with no collective dealing, 37.7 percent dealing
through a trade-union, 16.9 percent through a company union, and
5.6 percent through a company union and a trade-union. Of the very
large plants, only 8 percent dealt individually, 16 percent through
trade-unions, 48 percent through company unions, and 28 percent
through both company unions and trade-unions.
T able 6. — Distribution of establishments in each size group, by method of dealing
with employees, April 1935
E sta b lish m e n ts d ealin g—
S ize o f e sta b lish m en t
T o ta l e sta b
lish m e n ts
W ith som e
a ll w ork
In d iv id u a lly or
ers th ro u gh
trade-union
T h rou gh
com pany
u n io n
T h rou gh
co m p a n y
u n io n an d
trad e-u n ion
N u m P er N u m P er N u m P er N u m P er N u m P er
ber
ber cen t ber cen t ber cen t ber cen t
cen t
A ll e sta b lish m e n ts------ ---------------------1 to 49 w o rk ers_______________ _________
50 to 99 w o r k e r s.-- _____________ _____
100 to 199 w o r k e r s .._______ ______
200 to 499 w o r k e r s._ _______ __________
500 to 999 w o rk ers_____________________
1.000 to 2,499 w ork ers_________________
2,500 to 4,999 w ork ers________ __
^
5.000 w orkers an d o v e r ____________ .
14, 725
9,394
1,937
1, 424
1, 220
430
225
70
25
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
11, 267
7,987
1, 428
939
663
171
63
14
2
76.5 2, 866
8 5 .0 1, 345
73.7 453
66.0
388
54 .4 403
162
39 .8
28.0
90
21
20.0
4
8.0
19.5
14.3
23 .4
27. 2
33 .0
37. 7
40 .0
30 .0
16.0
496
57
53
82
134
73
56
29
12
3 .4
.6
2 .7
5 .8
11.0
16.9
24 .9
4 1 .4
48.0
96
5
3
15
20
24
16
6
7
0.6
.1
.2
1.0
1.6
5 .6
7 .1
8.6
28.0
TYPES OF EMPLOYER-EMPLOYEE DEALING
49
The percentage of establishments dealing under the various methods
changed from size group to size group in accordance with a regular
pattern. The proportion of establishments dealing individually fell
steadily as the size of the establishment increased; the companyunion percentage as well as the percentage for the combined companyunion and trade-union arrangement moved in the reverse direction,
while the percentage of establishments dealing through a trade-union
rose until it reached the 2,500-worker establishment and then fell.5
Regional Variations in Methods of Dealing
Methods of employer-employee dealing within a particular industry
often vary from region to region. The replies received were in most
cases not sufficient to permit analysis by region, particularly in those
industries with large units or with a more or less even distribution
throughout the country. Differences in methods of dealing with
employees as between establishments in different producing regions
were apparent, however, in the replies covering certain industries.
Thus in the sawmill industry company unionism was confined, in the
replies received, to the Pacific Coast area— California, Oregon, and
Washington. The same area also supplied most of the establishments
dealing through trade-unions. Sawmills in the southern States were
dealing almost entirely on an individual basis; those in the North
Central States entirely on that basis. In furniture manufacturing,
there were more company unions in Michigan, Minnesota, and Wis
consin, but even in these States individual dealing was most common,
dealing through trade-unions being almost entirely absent. Of 69
furniture factories which replied from the South, all reported dealing
on an individual basis. Trade-union dealing was relatively most im
portant in the far West where nearly half the firms, employing about
half the workers, dealt with trade-unions.
In automobile manufacturing Michigan showed a markedly higher
proportion of concerns dealing through company unions and a cor
respondingly lower percentage dealing with trade-unions than did the
States of Indiana and Ohio.
In the textile and clothing industries the difference in methods of
dealing as between the North and the South was marked. In cotton
goods, while a majority of workers in both areas were in establishments
dealing with their employees on an individual basis, a substantial pro
portion in the North were covered by trade-union dealing and only a
minute proportion in the South. In woolen and worsted goods, tradeunion dealing was almost entirely confined, in the replies received, to
the New England area, while the few cases of company-union dealing
were scattered over the country.
c In pa rticu lar in d u stries th e a p p lica b ility o f th is p a ttern w o u ld v a r y w ith th e e x ten t o f trade-union
org an ization th ro u gh o u t th e in d u str y as a w h o le , as w e ll as w ith regional variation s in ty p e s o f em p loy ere m p lo y ee d ealin g.
CHARACTERISTICS OF COMPANY UNIONS
50
In hosiery manufacturing, trade-union dealing was most general in
the North Atlantic area (New York, New Jersey, and Pennsylvania)
where a majority of the firms replying, employing nearly three-fourths
of the employees, dealt with the trade-union. On the other hand, of
58 establishments reporting from the South, only 3 reported dealing
with a trade-union and one through a company union. The remaining
establishments, representing nearly 90 percent of the workers in this
area, dealt with their employees on an individual basis.
Individual dealing in establishments manufacturing women’s
clothing was relatively most common in New England and in the South.
The North Atlantic area, including Connecticut, was the main strong
hold of trade-union dealing, which covered approximately 85 percent
of the establishments and workers in this area. Although a slight
majority of the establishments in both the Midwest and the far West
dealt on an individual basis, establishments dealing through tradeunions covered 60 percent of the employees in the former and 40 per
cent in the latter. The three company-union establishments were in
the Midwest and the far West. Trade-union dealing in the men’s
clothing industry was strongest in the Middle Atlantic States, notably
New York. It was negligible in the southern States. A majority of
the employees in the Middle West area were reported as covered by
trade-union dealing, while in the far West somewhat more than onethird were so covered.
The N. R. A. and Methods of Employer-Employee Dealing
Nearly two-thirds (378) of the company unions covered in the mail
inquiry were organized during the N. R. A. period of 1933 to 1935 (table
7). These included 306,528 or 58.0 percent of the total workers in the
establishments that had company unions.
Only three of the company unions were reported to have been estab
lished prior to 1900. The period from 1900 to 1914 showed but a slight
increase in the formation of company unions. During this period 8
company unions, 1.4 percent of the total, in establishments em
ploying 6,033 or 1.1 percent of the workers, were started. The succeed
ing period, 1915-19, during which the World War occurred, accounted
for the formation of 87 or 14.7 percent of the company unions cov
ered, in establishments employing 129,866 or 24.6 percent of the
workers.
Only a small number of the company unions which reported were
formed during the next three periods shown in table 7. Between 1920
and 1922, 31 company unions or 5.2 percent of the total number, with
5.7 percent of the workers, were formed; during the 1923 to 1929 period
35 or 5.9 percent were formed, with 33,484 or 6.3 percent of the
workers; during the first depression years, 1930 through 1932, only
TYPES OF EMPLOYER-EMPLOYEE DEALING
29 or 4.9 percent of the total were formed, with 10,453 or 2.0 percent of
the workers employed in the plants surveyed.
T
able
7.— Distribution of company unions in April 1935, by period of formation
C o m p a n y u n io n s o n ly
P eriod
E sta b lish
m en ts
W orkers
C o m p a n y u n io n s an d tradeu n io n s
E sta b lish
m en ts
T o ta l w ith c o m p a n y
u n io n s
E sta b lish
m en ts
W orkers
W orkers
N u m P er N u m P er N u m P er N u m P er N u m P er N u m P er
ber cen t
ber
cen t ber cen t
ber
ber
cen t ber cen t
cen t
B efore 1900_____ __
1900-14_______________
1915-19_______________
1920-22_______________
1923-29_______________
1930-32_______________
1933-35_______________
In d e fin ite in form a
tio n ______ ________
N o in fo rm a tio n _____
T o ta l_______ __
13
7
26
29
26
320
0.6
27
11
1.4
13. 7
5. 2
5 .9
5. 2
64.4
1.4
2. 2
8 497
100.0
68
1,295
5, 260
103, 948
24, 571
17, 785
9, 431
213,493
6,456
3, 715
385, 954
0 .3
1.4
26 .9
6 .4
4 .6
2 .5
55.3
1 .7
.9
100.0
1
1.0
773
19 19. 6 25, 918
5 5 .2 5, 306
6. 2 15,699
6
3 3. 1 1,022
58 60.5 93, 035
3 1 1.0
650
3 3 .1
176
96 100.0 142, 579
0 .5
17.9
3. 7
10.9
.7
65 .3
.5
13
8
87
31
35
29
378
<8
.1
14
100.0
8 593
0. 5 1, 295
1.3 6, 033
14.7 129,866
5 .2 29,877
5 .9 33,484
4 .9 10, 453
63.8 306, 528
1 .3 7,106
2 .4 3,891
100.0
528, 533
0.2
1.1
24.6
5 .7
6 .3
2.0
58 .0
1.4
.7
100.0
1 T h e se 3 differed from th e later form s o f co m p a n y u n io n s: 2 w ere in p la n ts o f sh o e m an u factu rers d ealin g
th ro u g h th e J o in t B o ard o f A rb itra tio n in P h ila d e lp h ia , a n e m p lo y er-em p lo y ee b o d y w h ic h , follow in g
a lo c k -o u t in P h ila d e lp h ia in 1887, su cceed ed a sim ila r a rran g em en t w ith th e K n ig h ts o f L ab or. T h e th ird
w a s a n in co rp o ra ted u n io n w h o se m em b ersh ip w a s lim ite d to th e w orkers o f a p a rticu lar co u n ty .
2 5 o<f th e s e , in c lu d in g 838 w ork ers, co u ld b e d e fin ite ly id e n tifie d as h a v in g b een se t u p before 1933, a lth ou gh
th e p a rticu la r p erio d w as n o t clear. O n e rep orted “ 2 or 3 years ag o ” a n d an oth er in d ic a te d th a t it h a d been
a m e n d e d in M a y 1934 b u t d id n o t rep ort th e d a te o f th e orig in al organ ization .
3 T h is e sta b lish m e n t rep orted d ea lin g th ro u gh th e L o y a l L egio n o f Loggers an d L u m b erm en , b u t d id n o t
in d ic a te w h e n th is m e th o d o f proced u re w as in itia ted .
i
S ee fo o tn o tes 2 a n d 3.
8 T h e to ta l figures are to o large b y 1, b ecau se 1 p u b lic u tility co m p a n y th a t rep orted h a v in g 8 c o m p a n y
u n io n s w h ic h h a d b een organized a t v a riou s tim es b e tw e e n 1924 an d 1932 ap p ears in b o th th e 1923-29 an d
1930-32 classification s. T h e n u m b er o f w ork ers is d iv id ed b e tw e e n th e tw o classification s. W h e n a ccou n t
is ta k en o f th e 5 cases referred to in foo tn o te 2, th e n u m b er o f cases d a tin g fro m before 1933 b ecom es 197,
or 33.3 p ercen t o f th e to ta l, an d th e n u m b er o f w ork ers 211,846, or 40.1 p ercen t o f th e to ta l.
There was apparently a tendency under the N. R. A. for company
unions to be set up in somewhat smaller establishments. Although
two-thirds of the company unions were set up in 1933 or later, they
included only 58.0 percent of the employees in establishments which
reported dealing through company unions. On the other hand,
although only a third of the company unions antedated 1933, they
represented 40.1 percent of the workers.
The period after March 1933 also witnessed a marked expansion in
trade-union dealing. Of the establishments which reported dealing
with a trade-union, 40.0 percent stated that such dealings had been
initiated under the N. R. A. (table 8). The advance of trade-union
dealing was more pronounced in terms of workers employed by the
establishments concerned. Although a majority of the establish
ments reported that their dealings with the trade-union antedated
1933, these establishments included only 42.5 percent of the em
ployees in establishments which reported trade-union dealing. Thus
the average size of the establishments which began dealing with a
trade-union under the N. R. A. was significantly larger than before
that date.
52
CHARACTERISTICS OF COMPANY UNIONS
T able 8.— Establishments dealing with trade-unions in April 1935, by period in
which dealings were begun
P eriod
E sta b lish
m en ts
C o m p a n y u n io n s an d
tra d e-u n io n s
T rad e-u n ion s o n ly
T o ta l
W orkers
E sta b lish
m e n ts
W orkers
E sta b lish
m e n ts
W orkers
N u m P er N u m P er N u m P er N u m P er N u m P er N u m P er
ber cen t ber cen t ber cen t ber c en t ber c en t ber cen t
B efore N . R . A ----- _ 1,640
D u r in g N . R . A__ ___ 1,187
135
N o t rep orted ______
T o ta l___________ 2,962
55.4 309,384
40.0 394 ,688
4 .6 22,973
100.0
727,045
42.5 1,611
54.3 1,123
3 .2
132
100.0
2,866
56.2 277,657
39.2 285, 558
4 .6 21, 251
100.0 584, 466
47.5
48.9
3 .6
100.0
29
64
3
96
3 0 .2 31, 727
66.7 109,130
3 .1 1, 722
100.0 142, 579
22.3
76.5
1.2
100.0
The effect of the N. R. A. upon the establishment of company
unions varied significantly from industry group to industry group.
Thus in public utilities a majority of the company unions, covering
65.5 percent of the workers, were established before 1933 (table 9).
A similar situation prevailed in the few company unions in the mining
group, with 63.4 percent of the workers in mines with company unions
established before 1933.
Within the durable industries groups,6 several divergent movements
appeared. In the lumber and machinery industries, a majority of the
company unions were set up during the N. R. A. However, these
covered considerably less than half of the workers in company unions
in these industries. Company unionism in the transportation-equip
ment industry, on the other hand, showed a marked expansion after
1932, an expansion that carried it into the larger units of the industry.
A more marked movement in this direction occurred in the stone,
clay, and glass products industry group, in which company unionism
was almost entirely a development of the N. R. A. period. At that
time such organizations were set up in a number of smaller plants
where no union existed and in a few larger plants in which craft
unions of long standing covered a small portion of the workers. In
the iron and steel industry group the development of company
unionism after January 1933 was more marked than in the durablegoods industries as a whole.7
In the nondurable-goods industries, only the wearing-apparel group
showed a majority of workers in establishments with company unions
dating from before 1933.8 The impact of company unionism in this
6 S ee fo o tn ote 1,
7 T h is te n d e n c y
ta b le 9.
w o u ld h a v e b een m ore ap p aren t if th e sa m p le in th is in d u str y h a d b een m ore rep resen ta
tiv e . S ee fo o tn ote 2 , p. 33.
8 W ith th e correction in d ica ted in footn ote 3 o f tab le 9, th is w o u ld also be tru e of th e food in d u stries.
53
TYPES OF EMPLOYER-EMPLOYEE DEALING
industry was less marked than upon the great majority of manu
facturing industries. Unusual increase in company-union coverage,
on the other hand, was evident in the textile fabrics and chemical
industries.
The cases in which the employer dealt with both company union
and trade-union presented varied patterns according to the time when
dealings with the different organizations were initiated. About onethird of the company unions in this group dated from before 1933
(table 7). The proportion of trade-unions which had been dealing
with the employer before 1933 was about 30 percent (table 8). The
different situations represented in these 96 cases were as follows:
C a ses
W ork ers
Both company-union andtrade-union dealing began before 1933__
Company-union dealing began before 1933, trade-union dealing
in 1933 or later_______________________________________________
Trade-union dealing began before 1933, company-union dealing in
1933 or later_________________________________________________
Both company-union and trade-union dealing began in 1933 or
later_________________________________________________________
Date unknown for one or both types of dealing_________________
15
11,705
19
37,013
14
20,022
42
6
71,411
2,428
Total____________________________________________________
96
142,479
These differing situations were related to the type of trade-union
which existed in the plant. In 45 establishments the trade-union
concerned was confined to a particular craft or class of employees. A
semi-industrial or industrial union competed with the company union
in 37 establishments. In the remaining 14 establishments, both a
craft union and an industrial or semi-industrial union functioned in
addition to the company union.
Of the 15 instances in which management had dealt with both
trade-union and company union before 1933, the trade-union in 13 cases
was a craft union,9 while in two others it was a semi-industrial union.
There were 14 cases in which trade-union dealing antedated 1933,
with company-union dealing following. These were mainly large
establishments in which the trade-union had covered only a single
craft or class of workers, while the subsequently established company
union was open to all workers. In 12 of these the trade-union was a
craft union,10 and in only 2 instances a semi-industrial union.
In most instances, management began dealing with both company
union and trade-union during the N. R. A. This was true in 42 estab
lishments, involving 71,411 workers, or 50.1 percent of the employees
in the establishments with dual bargaining situations. The trade-union
concerned was craft in 12 cases and industrial or semi-industrial in
21. In 9 instances both existed.
9 In
tw o o f th ese a n in d u stria l or sem i-in d u stria l u n io n en tered th e pictu re in 1933.
i° In o n e o f th ese m a n a g em en t also b ega n d ealin g w ith an in d u strial u n io n in 1933.
T
able
W orkers
E sta b lish m en ts
In d u stry group
_________
T o ta l
Before D u rin g N o t re
N . R . N . R . p orted
P er
A.
A.
N u m b e r cen
t
__ ____________ _ _________ .
592
D u rab le g o o d s 1______________________________________________________
Iron an d s t e e l 2______________ . ___ _________________________
M a ch in e r y ______ ________________________ _______________________
T ra n sp orta tio n e q u ip m e n t- _ _________ _____ __
_ __
N on ferrou s m e ta ls— ________________
______ __________
L u m b er an d allied p ro d u cts_________ _________________________
S ton e, c la y , an d gla ss p r o d u c ts_____ ____ __ _______ __
N o n d u ra b le good s 1___ ___________ ____________ — ___________ __________________ ______________ _
_______
T e x tile s.
__ __
F ab rics__________ __________ _________ ___ __
W earin g ap p arel__________ - _________________ _
__ _ _________
L ea th er______ ___________ __ ____________
F o o d 3. . . . _ __ _ ________ _____ __ ___________________
C igars ____________________________ ___________
. _____
P ap er an d p r in tin g .__ _______ _________ _____ _______
C h e m ic a ls.. _______________ _ ___________ _ _____
. ...
R u b b er p r o d u c t s _____________________ _______________ _______
M iscellan eo u s n o n d u rab le go o d s______ __
_ . __ __ _
P u b lic u tilitie s * _____________________________________________________
M in in g _______________________ __ ________ _______________________
A ll o th e r s__________ __________________ _________________________ __
280
71
106
25
21
32
25
223
53
37
16
16
32
17
41
8
5
13
4
61
19
12
7
6
10
22
46
65
15
30
55
197
88
9
378
182
50
63
15
15
18
21
159
34
25
9
17
10
4
2
2
1
1
3
1
1
11
10
2
29
12
48
17
7
11
1
21
21
3
8
5
1
528,533
282,010
62,174
131,979
55,307
15, 270
10, 685
6, 595
178, 822
27, 854
22,941
4,913
9,149
16,476
19, 467
64,057
41, 819
24,471
5, 325
37, 905
Before N . R . A .
N o t reported
N u m b er
P er
cen t
N um ber
P er
cen t
N um ber
40.1
41.0
25.2
55.8
22.2
46 .2
63.3
5.4
33.3
32 .5
27.7
54.5
48.2
43.9
33.4
28.4
33 .8
65.5
63.4
45.3
306, 528
157,374
2 41,146
57, 713
41, 033
7,973
3,273
6, 236
118,198
18,814
16, 580
2,234
4,740
3 8,897
58.0
55.8
66.2
43 .7
74.2
52.2
30.6
94 .6
66.0
67.5
72.3
45.5
51.8
54.0
10,159
8,894
5,348
664
1,994
238
650
’ 1,253
12, 805
45,837
27,105
8,328
1, 947
20, 681
65.7
71.6
64.8
34 .0
36.6
54.5
100.0
211,846
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
115, 742
2 15, 680
73,602
12,280
7,059
6,762
359
59, 544
9,040
6,361
2,679
4,409
3 7,235
100.0
100.0
100.0
6,495
18,220
14,145
100.0
100.0
100.0
D u rin g N . R . A .
16,023
3,378
17,159
344
167
P er
cen t
1.9
3 .2
8.6
.5
3 .6
1.6
6.1
.7
2.1
120
.9
1.4
.5
65
.2
569
1 T h e figures su g gest th a t th e stim u lu s of th e N . R . A . to th e organization of co m p a n y u n io n s w a s m ore p ron ou n ced am o n g th e n o n d u rab le th a n am o n g th e d u rab le goods in d u s
tries. H o w e v e r , it is p o ssib le th a t if proper allo w an ce w ere m ad e for th e om issions d iscu ssed in footn otes 2 an d 3 b elo w , th e differences b e tw e e n th e p ercen tag es for th e d u rab le an d
n o n d u rab le grou p s w o u ld b e la rg ely if n o t en tir e ly elim in a ted .
2 If allo w an ce w ere m a d e for th e in a d eq u a c y in th e iron an d steel sam ple discu ssed in footn ote 2, p. 33, th e p roportion of em p lo y ees b rou g h t u n d er c o m p a n y u n io n s d u rin g th e
N . R . A . p eriod w o u ld b e co n sid era b ly in creased .
3 I f a c c o u n t w ere ta k e n o f th e e sta b lish m e n ts referred to in footnote 9, tab le 3, th e figures for th e food in d u str y w o u ld b e m od ified co n sid erab ly. W h ile th e n u m b er of co m p a n y
u n i o n s se t u p u n d er N . R . A . w o u ld s t i l l b e m a r k e d ly greater th an th e n u m b er set up before th a t date, th e p ercen tages for e m p lo y ees w o u ld b e 58.7 p ercen t before N . R . A . an d 40.1
p ercen t u n d er N . R . A . T h e te n d e n c y tow ard in tro d u cin g com p a n y u n ion s in sm aller esta b lish m en ts d u rin g N . R . A . is again ap p aren t in th ese rev ised figures.
4E x clu d in g telep h o n e an d telegra p h an d railroads.
CHARACTERISTICS OF COMPANY UNIONS
T o ta l
A ll in d u stries cov ered —
Or
9.— Company unions in April 1935, by industry group and time of establishment
55
TYPES OF EMPLOYER-EMPLOYEE DEALING
The effect of the N. R. A. upon company unions was not confined to
the stimulus which it gave to the organization of new company unions.
Of the 197 company unions dating from before 1933, about one-third
were reported as having been reorganized after that date (table 10).11
Reorganization occurred much more frequently where a trade-union
also functioned than where the company union existed alone. Within
the group where both types of organization existed, change was some
what more frequent in small than in large establishments.
T
able
10.— Extent to which company unions established before 1933 were reorganized
under the N. R. A.
T o ta l w ith com p a n y
u n io n s
E sta b lish
m e n ts
W orkers
C o m p a n y u n io n s o n ly
E sta b lish
m en ts
W ork ers
C o m p a n y u n io n s an d
tra d e-u n io n s
E sta b lish
m en ts
W ork ers
N u m P er N u m P er N u m P er N u m P er N u m P er N u m P er
ber cen t
ber
ber
c en t ber cen t
cen t ber cen t
ber
cen t
R eorgan ized . _______
N o t reorgan ized____
N o t rep orted ________
T o ta l....................
65
104
28
197
33 .2 70,841
53 .0 109,294
13.8 31, 711
100.0 211,846
33 .4
51 .6
15.0
100.0
42
94
27
163
25.9
58.1
16.0
100.0
45,959
87,958
29, 211
163,128
28 .2
53 .9
17.9
100.0
23
10
1
67.7
29.4
2 .9
34
100.0
24,882
21, 336
2,500
48, 718
51.1
43 .8
5 .1
100.0
ii
T h e q u estion n a ire ask ed w h eth er th e p la n s h a d b een reorgan ized “ after 1929.” T h e field -stu d y an a ly sis
in d ica ted , h o w ever, th a t p ra ctica lly n o ch an ges in com p a n y -u n io n stru ctu re took p lace b etw een 1929an d 1933.
Chapter IY
Types of Employer-Employee Dealing— Telephone, Tele
graph, and Railroad Industries 1
Analysis of the returns from the telegraph and telephone industry
.and the railroad industry reveals sharp contrasts. Replies from
companies in the telegraph and telephone industry indicate that the
company union was practically the only significant method of deal
ing in this industry. Seventy-eight percent of the workers covered
by the replies were in companies with this type of dealing, and 16.2
percent more were in companies dealing through both company
unions and trade-unions. On the other hand, on 149 class I rail
roads, trade-union agreements covered 71.1 percent of the workers,
system-association contracts covered 24.1 percent, while the remaining
4.8 percent dealt with the railroad on an individual basis.
Telegraph and telephone industry .— Organizational peculiarities in
the telegraph and telephone industry made separate treatment of this
industry desirable. Because of the lack of distinct establishment
units, it was impossible to present figures on an establishment basis
similar to the treatment of the manufacturing and trade industries.
Furthermore, company unions, which predominated in the industry,
exhibited certain distinctive features. In many of the companies
there were separate company unions for different departmental
groups, as for example, construction and maintenance men or tele
phone operators. Company unions tended to be organized on a
regional basis and to be pyramided by a series of stages until they
covered all the operations of the company for that particular depart
ment. In two companies, the regional company unions culminated
in a single company union, which entered into one basic agreement
with the company covering its employees throughout the country.
In view of the relatively noncompetitive nature of the industry, it is
difficult to distinguish between organizations of this kind and tradeunions, except in terms of their actual functioning.
Since the industry is controlled by a few large companies, it was
possible to obtain a much larger coverage than in industry generally.
Replies from 50 companies 2 accounted for 317,995 workers, or 90
1 T h e c o m p a n y u n io n s an d sy ste m association s trea ted in th is sectio n are n o t cov ered in th e a n a ly sis in
ch. V of th e C h aracteristics of 592 C o m p a n y U n io n s. In d u stria l p ecu liarities an d , in th e case of th e railroads,
legal restrictio n s, cau se th ese organ ization s to a ssu m e so m ew h a t d ifferen t ch aracteristics th a n th o se th ere
an alyzed .
2 O n e im p o rta n t h o ld in g -co m p a n y sy ste m is treated here as 26 sep arate com p a n ies.
56
T E L E P H O N E , T E L E G R A P H , A N D R A IL R O A D IN D U S T R IE S
57
percent of the estimated total employment in the industry in April
1935.3
Company unions were practically the only significant method of
dealing in the industry. Twenty-six of the replying companies,
including 78.5 percent of the total workers covered by the replies,
dealt with their employees through company unions alone. In addi
tion, three telephone companies, employing 16.2 percent of the total
workers covered, reported that they dealt through both trade-unions
and company unions. In these companies with dual bargaining
agencies, the trade-unions functioned on a limited basis only.4 Two
independent companies, employing 133 workers, reported trade-union
dealings covering 73 of their workers. One large company and 18
small companies, employing a total of 16,880 workers, or 5.3 percent
of the total workers covered, reported dealing on an individual basis.
The railroad industry .— A separate study of employer-employee
relations on class I railroads was carried out with the cooperation of
the National Mediation Board. The Board made available for this
purpose its file of agreements maintained in compliance with the
provision in the Railway Labor Act of 1934 that each railroad engaged
in interstate transportation must file with the Board copies of each
agreement with every group of employees with whom it deals collec
tively. The file thus provided an almost complete picture of em
ployer-employee relations on 149 6 class I railroads as of July 1, 1935.6
The number of workers covered by the various agreements was esti
mated by the Bureau from the itemized monthly compensation
reports made by all class I roads to the Interstate Commerce Com
mission. April 1935 employment figures were used to make the
results comparable with other parts of the study.
3 T h is
d iscu ssio n d o es n o t cov er p ress-service or b rokerage-hou se telegra p h ers or w ir ele ss tra n sm issio n .
4 In 1 c o m p a n y w ith 20,000 w ork ers, a p p ro x im a tely 5,000 w ere cov ered b y 2 trad e-u n ion s; in an oth er
c o m p a n y a tra d e-u n io n cov ered co n stru ctio n a n d sw itch b o a rd m a in ten a n ce in 1 large m etro p o lita n area;
in th e th ird c o m p a n y tra d e-u n io n s cov ered co n stru ctio n an d m a in ten a n ce m e n in 1 S-feate an d telep h o n e
op erators in 1 c ity .
3 O n e sm a ll r a ilw a y o u tsid e c o n tin e n ta l U n ite d S ta tes is exclu d ed , as are also su ch u n its as th e P u llm a n
C o. a n d th e ex p r e ss co m p a n ies, w h ic h d o n o t conform to th e gen eral occu p a tio n a l p a ttern o f th e railroads.
T h e P u llm a n C o. rep orted 18,758 w ork ers o n D e c . 31,1934, ex c lu siv e o f general officers a n d su p erin ten d en ce
force. O f th ese, th e 1,417 c o n d u cto rs w ere cov ered b y a tra d e-u n io n co n tract a n d th e 488 la u n d r y w ork ers
w ere n o t co v ered b y a n y a g en cy . T h e rem a in in g e m p lo y ee s w e re cov ered b y co m p a n y -u n io n arrange
m e n ts. H o w ev er , in an e lec tio n co n d u c ted b y th e N a tio n a l M e d ia tio n B o ard , th e resu lts o f w h ic h w ere
a n n o u n c e d b y th e B o ard o n J u ly 1, 1935, a tra d e-u n io n w o n o u t o v er a sy ste m a ssociation for th e rig h t to
rep resen t th e p o rters an d m a id s in co lle c tiv e b argain in g. T h e c o m p a n y rep orted 6,752 w ork ers in th is
cla ss o n D e c . 31, 1934.
T h e tw o in te r sta te express co m p a n ies rep orted , for A pr. 15, 1935, ap p ro x im a tely 36,500 w ork ers ex clu siv e
o f officials, su p erv iso rs, a n d c o n fid en tia l e m p lo y ee s. N e a r ly a ll o f th ese w ork ers w ere cov ered b y tradeu n io n co n tr a c ts or b y w o r k in g ru les issu ed b y th e c o m p a n y b u t id e n tic a l w ith th o se agreed to b y th e
c o m p a n y an d tra d e-u n io n s co v erin g em p lo y ee s m em b ers of th o se u n io n s. T h ere are n o sy ste m association s.
S ta tio n a g e n ts a n d so m e co m m o n lab orers w ere n o t cov ered b y con tracts.
• E le c tio n s c o n d u c ted b y th e B o a rd in th e p eriod b e tw e e n J u ly 1,1 935 , an d th e p u b lic a tio n of th e rep ort
h a v e effected a n u m b er o f ch an g es in th e situ a tio n . A lm o st all su c h ch an g es w ere from sy stem -a sso cia tio n
to tra d e-u n io n d ealin g.
1 5 4 8 7 5 °— 35
-5
58
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
Of the 909,249 employees included in the survey,7 646,169, or
71.1 percent, were covered by trade-union agreements, 218,885, or
24.1 percent, by agreements with system associations,8 and 44,195 or
4.8 percent, were dealt with on an individual basis (table 11).
Subdivision by craft or class of employees reveals significant differ
ences. The four engine- and train-service employees' groups were
almost completely covered by trade-union contracts. The yard-serv
ice employees and the signalmen showed over 94 percent trade-union
coverage. Of the yard-service employees, most of the remainder,
consisting in the main of yardmasters, were to be found under indi
vidual dealing; of the signalmen, 1.7 percent were covered by system
associations and 2.3 percent dealt individually.
System associations were strongest in the shop crafts, in which they
covered 46.6 percent of the workers, whereas the trade-unions covered
47.0 percent. Individual dealing applied to 15,744, or 6.4 percent,
of the workers in the shop crafts, but the overwhelming majority of
these were stationary firemen and oilers, of whom 13,332, or 28.1
percent, were not covered by any collective contract. Next to shop
crafts, the highest percentages of dealing through system associa
tions were found among the dining-car-service employees (31.3 per
cent), the clerical and station employees (27.5 percent), and the
maintenance-of-way workers (21.9 percent).
Apart from the miscellaneous group of employees, the largest
proportion of individual dealing was found among the dining-car
employees (39.8 percent), followed by the train dispatchers with
29.4 percent, and the firemen and oilers with 28.1 percent. No
other craft or class showed as much as 5 percent of the workers dealing
on an individual basis.
7 T h e to ta l n u m b er o f e m p lo y ees o f th e 149 railroads as o f th e m id d le o f A p ril 1935 w a s a p p ro xim a tely
977,000. O f th is n u m b er, ap p ro x im a tely 60,000 w ere ex clu d ed from th e s tu d y b ecau se t h e y w ere eith er execu
tiv e s or su p ervisors, or w ere e m p lo y ed in a m ore or le ss co n fid en tia l ca p a city . T h e grou p s exclu d ed , in term s
o f th e n e w In te rsta te C om m erce C o m m issio n classification , are class n u m b ers 1, 2, 3, 4 ,1 1 ,1 3 ,1 7 ,1 8 ,1 9 , 20,
21, 22, 27, 28, 44, 50, 51, 52, 78, 84, 85, 99. M a rin e em p lo y ee s (98) to ta lin g 6,364 w ere in c lu d e d in th e a n alysis
of ag reem en ts b u t n o t of w ork ers cov ered , sin c e th e m e th o d o f rep ortin g d id n o t p erm it an e ffe ctiv e break
dow n.
8 T h e term “ sy ste m asso cia tio n ” is u sed h ere sin ce it is th e term a d o p ted b y th e N a tio n a l M e d ia tio n
B o a rd to d escrib e th e n on -tra d e-u n io n organ ization s fu n ctio n in g o n th e railroads w ith in th e req u irem en ts
se t b y th e R a ilw a y L a b or A c t.
T E L E P H O N E , T E L E G R A P H , A N D R A IL R O A D
I N D U S T R IE S
59
T able 11.— Method of employer-employee dealing on class I railroads, hy craft
or class of employees, April 1935
R ailroa d s h a v in g
ag reem en ts w ith —
C raft or class
T o ta l
num
T o ta l
ber
o rk
S y s N o wers
of
2
rail Trade- tem organ
roads 1 u n io n asso iz a
cia
tio n tio n
A ll crafts or cla sses_________
E n g in e an d tra in se r v ic e . _
E n g in eers______________
F ire m e n _____________ ...
R oa d co n d u c to r s_____
B ra k em en , flagm en ,
an d b a gga gem en ------Y ard -serv ice e m p lo y ee s—
C lerical a n d sta tio n e m
p lo y e e s-------------- ----------T elegrap h ers______ _________
S ig n a lm en __________________
T ra in d isp a tch ers__________
M a in ten a n ce o f w a y ________
S h o p crafts__________________
M a c h in is ts ___________
B o ilerm a k ers__________
B la c k sm ith s___________
S h eet-m eta l w orkers
E lectrica l w ork ers 9___
C arm en _________________
F irem en a n d oilers____
H e lp e r s 10_____________
D in in g-car serv ice__________
M a rin e e m p lo y ee s...................
M iscella n eo u s 13____________
149
149
149
149
145
149
149
135
140
149
148
146
145
136
139
149
148
109
50
132
132
130
136
136
132
6 84
109
7 77
67
8 99
74
77
74
76
9 73
73
7 40
1117
11 26
6
12
3 12
8
4 10
5 27
6 32
17
75
14
8 38
55
50
51
49
9 55
54
7 25
11 25
1111
24
5
5
5
7
35
23
54
59
23
19
19
8
20
11
17
22
84
72
18
102
909, 249
158, 716
39, 917
45, 773
22, 468
50, 558
54, 730
180,817
43,892
11, 620
3, 321
192, 482
244, 999
37, 728
10, 321
4,637
7, 843
10, 887
62, 964
47, 420
63,199
9,481
( 12)
9,191
E stim a te d n u m b er o f
w orkers covered b y agree
m e n ts w ith —
T rad e-u n ion
S y stem
association
E stim a te d
n u m b er o f
w orkers n o t
covered b y
a g r ee m e n ts 2
N u m P er N u m P er N u m P er
ber
cen t
ber
cen t ber cen t
646,169
156, 514
39, 083
45,097
22, 231
50,103
51,826
125, 796
37,447
11,152
1,966
143,421
115, 015
18,186
5, 591
2,196
4, 321
4,735
33,812
17, 058
29,116
2, 736
( 12)
296
71.1
98. 6
97 .9
98.5
98.9
99.1
94.7
69.6
85 .3
96 .0
59.2
74.5
47 .0
48 .2
54 .2
47 .3
55.1
43 .5
53 .7
3 6 .0
46 .1
28 .9
( 12)
3 .2
218,885
1,286
620
344
84
24.1 44,195
.8
1.6
.8
.4
.5
238
665 1.2
49, 811 27 .5
5, 687 13.0
198 1.7
378 11.4
42,153 21 .9
114, 240 46.6
19,168 50.8
4, 568 44 .2
2, 363 51 .0
3, 445 43 .9
5,988 55 .0
28, 355 45 .0
17, 030 35.9
33, 323 52. 7
2, 969 31.3
( 12)
( 12)
1,498 16.3
4 .8
.6
916
214
.5
332
.7
153
.7
.4
217
2,239 4 .1
5,210 2 .9
758 1 .7
270 2 .3
977 29 .4
6,908 3 .6
15,744 6 .4
374 1.0
162 1.6
78 1 .7
77 1.0
164 1 .5
797 1.3
13,332 28.1
760 1.2
3, 776 39.8
( 12) (! 2)
7, 397 80 .5
1 T o ta l n u m b er o f class I road s rep ortin g w ork ers in A p ril 1935 an d /or ag reem en ts in class or craft in d ica ted .
2 T h e rep ortin g n u m b ers u n d er th e n e w In te rsta te C om m erce C om m issio n classification w ere allocated
a m o n g th e v a riou s crafts or classes in accordance w ith th e gen eral p a ttern se t b y th e tra d e-u n io n agree
m e n ts. A s a r esu lt o f v a r ia tio n s in th e cla ssification s covered in so m e ag reem en ts, th e to ta l for each craft
or class m a y n o t ta lly e x a c tly w ith th e I . C . C . to ta l. R ailroa d lab or ag reem en ts, p a rticu larly th o se cov er
in g clerk s, p ro v id e for m a n y ex cep tio n s. In a few cases th e y cov er o n ly p a rt o f a group o f w orkers w h o are
in clu d ed in a sin g le figure in th e e m p lo y m e n t rep ort. I t v as n o t, therefore, p o ssib le to d eterm in e th e exact
cov erag e o f each ag reem en t. T h e figures are, h o w ever, con sid ered to ap p ro xim a te th e general situ a tio n .
T h e y p ro b a b ly o v e rsta te so m ew h a t th e e x ten t o f c o llectiv e d ealin g a s o p p osed to in d iv id u a l dealing.
31cov ered N e g r o w ork ers o n a road o n w h ic h w h ite w ork ers w ere cov ered b y a trad e-u n ion .
4 2cov ered N e g r o w ork ers o n roads o n w h ic h w h ite w orkers w ere cov ered b y a trad e-u n ion .
620 co v ered ya rd m a sters o n railroads w h ere oth er ya rd -service em p lo y ees w ere covered b y a trad e-u n ion
or u n io n s; 2 cov ered N eg ro w ork ers w h ere w h ite w orkers w ere cov ered b y a trade-union.
0 O n 11 roads a sy ste m association cov ered p a rt o f th e w orkers an d a tra d e-u n io n p art o f th e w orkers.
7 O n 1 road a sy ste m a ssociation cov ered p a rt o f th e w orkers a n d a tra d e-u n io n p a rt o f th e w orkers.
8 O n 10 road s a sy ste m association cov ered p a rt o f th e w ork ers a n d a tra d e-u n io n p a rt o f th e w orkers.
9 In c lu d in g lin e m e n a n d gro u n d m en . In 2 cases, sh o p w orkers w ere cov ered b y a sy ste m association ,
lin e m e n a n d gro u n d m en b y a trade-union; in 1 case, th e reverse situ s tio n existed . E x clu d in g lin em en an d
gro u n d m en , th e p ercen tag es o f electrica l w orkers cov ered b y th e d ifferen t m e th o d s of d ealin g w ere: 46.7
p ercen t tra d e-u n io n , 51.9 p ercen t sy ste m association , an d 1.4 p ercen t in d iv id u a l.
10 T h ere are n o sep ara te agreem en ts for h elp ers, b u t th e y follow th e ag reem en ts o f th e crefts concern ed.
T h e n u m b er o f h elp ers w a s d istr ib u te d in p rop ortion to th e m e th o d o f d ealin g w ith oth er sh o p crafts (ex
c ep t firem en a n d oilers) o n th e road. T h e fig u ie is therefore o n ly a n ap p ro xim a tio n .
11 O n 5 roads a sy ste m association cov ered p art o f th e w orkers an d a trad e-u n ion part.
12 S in ce road s rep ort a ll m a rin e e m p lo y ees u n d er 1 classification (98), th ere w a s n o w a y of breaking d o w n
th e to ta l figure o f 6,364 m a rin e em p lo y ees in to th ose covered b y tra d e-u n io n an d sy stem -a sso cia tio n c o n
tracts a n d th o se cov ered b y n o con tract.
13 In clu d es sleep in g-car con d u ctors (16), m iscellan eou s trad e w orkers (23), gang forem en an d gang leaders
(sk illed labor) (53), m old ers (62), train a tten d a n ts (101), an d la u n d ry w orkers (104).
Chapter Y
Characteristics of 592 Company Unions1
Company unions are generally open to all the workers in the shops
or factory, and in many cases they include office workers as well.
In 13 cases, however, the company union was either limited to a
single section or department of the plant or certain sections or de
partments were definitely excluded.2
Taking the company-union group as a whole, 55.0 percent of the
establishments covered, with 54.4 percent of the workers, had an
optional membership basis of participation; and in 38.9 percent of the
establishments, employing 41.3 percent of the workers, participation
in the company union was automatic, either immediately upon employ
ment or after having worked in the establishment for a certain length
of time (table 12).3 For the remainder no information was available.
T
able
12.— Participation provisions of company unions, April 1935
E sta b lish m e n ts
T y p e of u n io n
E sta b lish m e n ts w ith :
C o m p a n y u n io n s
o n l y . . -----------C o m p a n y u n io n s
an d tra d e-u n
io n s______________
T o ta l_________
W orkers in v o lv e d
N um ber
T o ta l
In c o m p a n y u n io n s
P a r tic i
p ro v id in g for—
p rov id in g for— P ar
pa tion tic i
p
rov ision
p a tion
n o t re
T o A u to O p p ro v i
A u to m a tic
O p tion al
p orted
p a rticip ation m em b ersh ip
tal m a tic tio n a l sio n
N
u
m
P
er
n
o
t
par m e m re
ber cen t
tic i ber
N u m P er N u m P er N u m P er
p a tio n sh ip p orted
ber cen t ber cen t ber cen t
496
216
248
32 385,954 100.0 194, 901 50.5 171,073
44.3 19,980
5 .2
96
592
14
230
78
326
4 142, 579 100.0 23,444
36 528,533 100.0 218, 345
81.7 2,707
54.4 22, 687
1.9
4 .3
16.4 116,428
41.3 287, 501
Of the 496 establishments with company unions only, 216 or 43.5
percent reported that employees were automatically entitled to
participate. These establishments included 50.5 percent of the work
ers. A larger number of plants reported functioning under optional
membership, but the number of workers covered by this group of
> T h e d iscu ssion in th is ch ap ter is b a sed u p o n a n a n a ly sis o f th e 592 c o m p a n y u n io n s referred to in ch . III.
Of th e to ta l, 496 w ere in e sta b lish m e n ts w h ic h d e a lt w ith a c o m p a n y u n io n o n ly an d 96 in esta b lish m e n ts
w h ic h d ea lt w ith b o th a c o m p a n y u n io n a n d on e or m ore tra d e-u n io n s.
2 “ M o ld ers o n ly ” ; “ p olish ers an d b u ffers o n ly ” ; “ fo u n d ry ” ; “ on e d ep a rtm en t o n ly ” (3 cases); “ o u tsid e
sa les force” ; “ all sa v e sa les a n d office” ; “ b u s op erators” ; “ m anagers, b u tch ers, an d e x e c u tiv es” ; “ op eratin g
d e p a r tm en t e m p lo y ee s o n ly ” ; “ m a ch in e d iv isio n o n ly ” ; “ m a le w orkers o n ly .”
3 F or d iscu ssion of p a rticip a tio n b a sis an d its sig n ifican ce, see ch . X .
60
61
C H A R A C T E R IS T IC S O F 592 C O M P A N Y U N IO N S
establishments was less than the total under automatic participation.4
This would suggest that the larger plants in this group tend somewhat
toward an automatic rather than optional participation basis.
In establishments having both a company union and a trade-union,
the percentage of company unions with optional membership was
considerably greater. Of the 96 company unions in this group, fourfifths provided for optional membership. Fourteen plants, with
16.4 percent of the workers, had plans involving automatic partici
pation. In these 14 plants, therefore, trade-union members would
also automatically be entitled to participate in the company union.
A pronounced shift from automatic participation to optional mem
bership took place after the passage of N. I. R. A. (table 13). Of
company unions in existence before that date, 42.6 percent were at
the time of the study on an automatic basis and 49.8 percent on a
membership basis.6 Among the company unions first set up under
N. R. A., only 36.5 percent were of the former type and 58.7 percent
of the membership type.
T
able
13.— Participation basis of company unions in April 1935, by period of
formation
P a rticip a tio n b asis
P eriod of form ation
T o ta l
O p tion al
m em b ersh ip
A u to m a tic
N o t rep orted
N u m b e r P ercen t N u m b e r P ercen t N u m b e r P ercen t N u m b e r P ercen t
E sta b lish m e n ts
B efore N . R . A ----------------------D u r in g N . R . A ________ _____
N o t rep o rted _________________
T o ta l___________ _____
197
378
17
592
100
100
100
100
84
138
8
230
42. 6
36 .5
47.1
38.9
98
222
6
326
49.8
58.7
35 .3
55 .0
15
18
3
36
7. 6
4 .8
17 .6
6 .1
105,483
178,414
3, 604
287, 501
49 .8
58 .2
35.5
54 .4
5,859
16, 519
309
22, 687
2 .8
5 .4
3 .0
4 .3
W orkers
B efore N . R . A ----------------------D u r in g N . R . A --------------------N o t rep o rted ________ ___
T o ta l________ _______
211, 846
306, 528
10,159
528, 533
100
100
100
100
100, 504
111, 595
6,246
218,345
47.4
36 .4
61. 5
41 .3
Dues and Benefit Provisions
Of the total of 592 company unions studied 411, covering 411,053
workers, reported that they had no provision for dues or any other
means of raising funds from the membership, while 26, with 12,403
4
T h e rem a in in g esta b lish m en ts for w h ich p a rticip a tio n p rovision w as n o t rep orted in v o lv e d 6.5 p ercen t
of th e esta b lish m en ts an d 5.2 p ercen t of th e w orkers.
6 S o m e p la n s d a tin g from before 1933 ch an g ed from an a u to m a tic to a m em b ersh ip b asis after th a t d a te.
See ch. I X .
62
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
workers, did not reply to the question, “ Do members pay dues?”
Some provision for payment by the members was made in 155 plants,
covering 105,077 or 19.9 percent of the workers (table 20). Of these
155 establishments 140 had optional membership; 127 of these re
ported company union membership extending to 71.2 percent of their
employees (table 16).
Dues provisions occurred somewhat more frequently where a tradeunion was also recognized as representative of some of the employees
than in establishments where a company union alone existed (table
14). The greater frequency of dues provisions was not as marked,
however, as was the matter of optional membership.6
T
able
14.— Dues provisions of company unions, April 1985, by type of dealing
T o ta l
E sta b lish
m en ts
D u e s p rovision
C o m p a n y u n io n s an d
trad e-u n ion s
C o m p a n y u n io n s o n ly
W orkers
E sta b lish
m en ts
E sta b lish
m e n ts
W orkers
W orkers
N u m P er N u m P er N u m P er N u m P er N u m P er N u m P er
ber cen t
ber
ber
ber
c en t ber cen t
cen t ber cen t
cen t
D u e s ____ __ ___ _ _ 155 26 .2 105,077 19.9
N o d u e s_____ ________ 411 69.4 411, 053 77.8
26 4 .4 12, 403 2 .3
N o t rep orted ________
T o ta l_________ 592 100.0 528, 533 100.0
123 24.8 73,666 19.1
360 72. 6 306, 776 79.5
13 2 .6 5, 512 1.4
496 100.0 385, 954 100.0
32 3 3 .3 31,411
51 5 3 .2 104, 277
13 13.5 6, 891
96 100.0 142, 579
22 .0
73.2
4 .8
100.0
Almost 70 percent of the establishments charging dues charged
40 cents a month or less (table 15); these establishments employed
80.2 percent of all the workers. Only 7 plants, employing 5.3 percent
of the workers, reported dues cf more than 80 cents a month. Two
plans relied on assessments only, while 10 others had various provisions
for raising funds.
T
able
15.— Amount cf monthly dues cf company unions, April 1935
C o m p a n y u n io n o n ly
M o n th ly dues
U n d er 20 cen ts__________
_
2 1 ^ 0 c e n ts___ ______ _____________
4 1 -8 0 c e n ts_________ _________. . .
81-100 c en ts__________ __ _ _ _ .
O ver 100 c e n ts____
A ssessm en ts o n ly _ _ __. ___
O ther p r o v isio n ._ ___ ___ __
A m o u n t n o t s ta te d ______________
T o ta l.__ _______________
C o m p a n y u n io n an d
trad e-u n ion
W orkers
E sta b
E sta b
lish
lish
m en ts N u m P er m en ts
ber
cen t
31
48
19
3
2
2
1 10
8
123
31,118
25,578
11, 079
761
1,435
392
1,889
1,414
73, 666
42.2
34.7
15.1
1 .0
2. 0
.5
2 .6
1.9
100.0
T o ta l w ith co m p a n y
u n io n s
W orkers
Num
ber
E sta b
lish
P er m en ts
cen t
14
14
1
2
15,122
12,473
236
3, 381
48.1
39.7
.8
10.8
1
32
199
31,411
.6
100.0
45
62
20
5
2
2
1 10
9
155
W orkers
N um
ber
P er
cen t
46, 240
38, 051
11,315
4,142
1,435
392
1,889
1,613
105, 077
4 4 .0
36 .2
10.8
3 .9
1 .4
.4
1. 8
1.5
100. 0
1 In 9 of th ese, d u es varied w ith w ages. 1 e sta b lish m en t rep orted th a t 1 cen t per h o u r h a d b een a d d ed
to th e b ase rate of all factory w orkers an d th en p a id over to th e c o m p a n y u n io n .
£See p . 60.
C H A R A C T E R IS T IC S OF 592 C O M P A N Y U N IO N S
03
T a b l e 16.— Benefit provisions and reported membership in company unions having
optional membership and charging dues, April 1935
C o m p a n y u n io n s w ith o p tio n a l m em b ersh ip
an d d u es
C o m p a n y u n io n s for w h ic h
m em b ersh ip w a s rep orted
P ro v isio n for b en efits
E sta b W ork
lish
m en ts ers E sta b
lish
m e n ts T o ta l
W orkers
M em b ers of
c o m p a n y u n io n
N u m P ercen t
ber of to ta l
C o m p a n y u n io n s w ith b e n e fits____________________________
E sta b lish m e n ts w ith co m p a n y u n io n s o n ly ............... ..
E sta b lish m e n ts w ith c o m p a n y u n io n s a n d tradeu n io n s_________
_ - . ____________________________
C o m p a n y u n io n s w ith o u t b e n e fits________________________
E sta b lish m e n ts w ith c o m p a n y u n io n s o n ly -------------E sta b lish m e n ts w ith c o m p a n y u n io n s a n d tradeu n io n s. __ _________ _________________________________
A ll c o m p a n y u n io n s________________________ _______________
E sta b lish m e n ts w ith c o m p a n y u n io n s o n ly __________
E sta b lish m e n ts w ith c o m p a n y u n io n s a n d tradeu n io n s___________________
_________________________
90
66
24
50
42
8
140
108
32
62, 767
43, 268
19,499
30, 603
18,690
11,913
93, 370
61, 958
31,412
86 48,179
64 36,762
22 11,417
41 26, 786
34 15, 523
7 11, 263
127 74,965
98 52, 285
29 22,680
37, 224
27,212
10,012
16,117
11, 238
4,879
53, 341
38,450
14,891
77.3
74.0
87 .7
60 .2
72.4
43 .3
71.2
73.5
65 .7
Dues provisions were found almost exclusively in company unions
in which membership was optional. However, in 13 establishments,
employing 11,315 workers, dues were required even though participa
tion was automatic; in 11 of these, the worker received for his dues
the right of participation in certain insurance and loan benefits, but
in the other 2 establishments, both small, no benefits were provided.
In 90 plans with optional membership and dues provisions, pay
ment of the dues entitled the member to benefit features (table 16).
These plans covered 62,767 workers. Fifty plans, covering 30,603
workers, provided no health, loan, or life-insurance benefits. Table 16
indicates that the reported proportion of the employees who were
members of optional company-union plans was smaller where no
benefits were provided than where right to benefits accompanied
membership. This difference, however, was accounted for by the
group of establishments dealing through both a trade-union and a
company union. In such establishments the company unions
providing benefit features had an average membership of 87.7 percent
of the employees; where no such features were provided, the average
membership was only 43.3 percent.
The analysis made as a result of the field study (see pt. I l l ) indi
cated that dues provisions were primarily a development of the N.
R. A. period.7 Among the company unions which replied to the mail
questionnaire, however, a somewhat larger proportion with dues pro
visions was found among those set up before the N. R. A. than among
? See p . 115.
64
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
those which developed after March 1933. Several factors account for
this difference.
In the first place, it is probable that some of the pre-N. R. A.
organizations reported as company unions in the mail-questionnaire
study were in reality mutual benefit associations or were originally
established as mutual benefit associations and assumed certain func
tions in connection with individual grievances, wages and hours, and
similar matters after March 1933. Replies to some of the question
naires indicated that such changes did take place. Thus one stated:
The Employees’ Mutual Benefit Association has existed for many years.
When the N. R. A. went into effect, the president of this organization and the
board organized a personnel relations committee as an auxiliary of this association.
Another said:
This plan was originally for welfare and sick benefits.
collective bargaining and social purposes.8
Now it is mainly for
In this connection it may be noted that, while 44.8 percent of the
newer company unions which charged dues provided no benefit fea
tures, only 18.8 percent of the pre-N. R. A. company unions which
charged dues had no benefit features. All of the pre-N. R. A. company
unions which charged dues and provided no benefit features were
federated organizations of the type of the Loyal Legion of Loggers and
Lumbermen or the American Guild of the Printing Industry in Balti
more. The fact that no company unions of this type were included in
the field study is a second factor explaining the difference in results on
this point. To this extent, qualification of the statement made with
regard to dues in the field study is necessary. A third factor contrib
uting to the discrepancy is the fact that the mail questionnaire showed
only the practice of the company union as of April 1935. It did not
indicate what changes had been made between the passage of the
N. I. R. A. and the date of the reply. Of the 63 pre-N. R. A. company
unions which reported that dues were charged, 27 reported that they
were amended in some way after 1929. The evidence in the field study
shows that a number of company unions adopted their dues provisions
after March 1933.9 The extent to which the 63 company unions estab
lished before 1933 introduced their provisions for dues after 1933
cannot be determined from the data.
Meetings and Compensation of Employee Representatives
Replies to the mail questionnaire indicated that employee repre
sentatives most commonly met once a month to take up matters
brought to their attention. Monthly meetings prevailed in about
8 T h e ex ten t to w h ich th is ch an g e occurred am o n g th e field -stu d y cases is d escrib ed in ch . V I.
» See fo o tn o te 6, p . 116,
65
C H A R A C T E R IS T IC S OF 592 C O M P A N Y U N IO N S
47 percent of the company unions, in establishments employing 58
percent of the workers (table 17). In about 17 percent of the com
pany unions, the representatives met only “ on call.” These were
principally in the smaller establishments, comprising a total of 7.9
percent of the workers. Weekly or semimonthly meetings were held
by the representatives in 17 percent of the company unions, the pro
portion being somewhat greater where trade-unions were also recog
nized by management than where company unions alone functioned.
T
able
17.— Frequency of meetings of company-union representatives, April 1935
T o ta l w ith co m p a n y
u n io n s
E sta b lish
m en ts
F req u en cy of
m eetin gs
W orkers
C o m p a n y u n io n s o n ly
E sta b lish
m en ts
W orkers
C o m p a n y u n io n s an d
trad e-u n ion s
E sta b lish
m en ts
W orkers
N u m P er N u m P er N u m P er N u m P er N u m P er N u m P er
ber
cen t ber cen t
ber
ber cen t
cen t ber cen t
ber
cen t
W e e k ly . __ ________
S e m im o n th ly _______
M o n th ly ____________
Q u arterly___________
O n c a ll______________
N o rep orted m e et
in g s
N o t rep orted ___ __
T o ta l_________
46 7 .8 54,824 10.4
66 9 .5 70,116 13.3
277 46.7 307,779 58 .2
27 4 .6 17,968 3 .4
100 16.9 41,829 7 .9
(!)
3
181
.5
83 14.0 35,836 6 .8
592 100.0 528, 533 100. 0
35 7.1 41,489 10.7
45 9.1 40, 288 10.4
236 47.6 228,136 59.2
17 3 .4 14, 598 3 .8
88 17.7 33,131 8 .6
3
181 (i)
.6
72 14.5 28,131 7 .3
496 100.0 385,954 100.0
11 11.5
11 11.5
41 42 .6
10 10.4
12 12.5
13, 335
29, 828
79, 643
3, 370
8, 698
9 .4
20.9
55 .8
2 .4
6.1
11 11.5 7, 705
96 100.0 142,579
5 .4
100.0
1 L ess th a n H o of 1 p ercen t.
Representatives were compensated for time while attending com
pany-union duties in about 70 percent of the cases (table 18). These
company unions were in establishments employing 86 percent of all
the employees. There was thus a greater tendency for payment in
the larger than in the smaller establishments.
T
able
18.— Provisions for payment of company-union representatives for time
while attending to company-union duties, April 1935
T o ta l w ith co m p a n y
u n io n s
P ro v isio n for
paym ent
E sta b lish
m e n ts
W orkers
C o m p a n y u n io n s o n ly
E sta b lish
m en ts
W orkers
C o m p a n y u n io n s an d
trad e-u n io n s
E sta b lish
m e n ts
W orkers
N u m P er N u m P er N u m P er N u m P er N u m P er N u m P er
ber cen t
ber
ber
cen t ber cen t
cen t ber cen t
ber
cen t
R e p r e s e n ta tiv e s
p a id _______________
R e p re se n ta tiv e s n o t
p a id _______________
P ro v isio n n o t re
p o r te d _____________
T o ta l...................
425 71.8 454,997 86.1
139 23.5 60,198 11.4
28 4 .7 13,338 2 .5
592 100.0 528, 533 100.0
357 72.0 329,012 85.2
116 23.4 47,474 12.3
23 4 .6 9,468 2 .5
496 100.0 385, 954 100.0
68 70.8 125,985
23 24 .0 12, 724
5 5 .2 3,870
96 100.0 142,579
88 .4
8 .9
2 .7
100.0
66
CHARACTERISTICS OF COMPANY UNIONS
The rate of payment was predominantly the employee’s regular
rate of pay (table 19). In nearly 10 percent of the cases, however,
representatives were paid a stipulated amount for their services in
the company union.
T able 19.— Rate of payment of company-union representatives, April 1935
T o ta l w ith c o m p a n y
u n io n s
E sta b lish
m e n ts
R a te of
paym ent
W orkers
C o m p a n y u n io n s o n ly
E sta b lish
m en ts
W orkers
C o m p a n y u n io n s an d
tra d e-u n io n s
E sta b lish
m e n ts
W orkers
N u m P er N u m P er N u m P er N u m P er N u m P er N u m P er
ber cen t
ber
ber
cen t ber cen t
ber
cen t ber cen t
cen t
374 88 .0 386,133 84.9
39 9 .2 54, 334 11.9
12 2 .8 14, 530 3 .2
425 100.0 454, 997 100.0
R egu lar w ag e r a te .. _
S tip u la te d rate_____
R a te n o t rep o rted . _ _
T o ta l_________
315 88.3 292,419 88.8
33 9 .2 29,164 8 .9
9 2 .5 7,429 2 .3
357 100.0 329, 012 100.0
59 86.8 93,714
6 8 .8 25,170
3 4 .4 7,101
68 100.0 125,985
74.4
20 .0
5 .6
100.0
The compensation received by employee representatives for time
spent on company-union business came from the employer in about
90 percent of the cases (table 20). In less than 4 percent of the
company unions, compensation came solely from employees’ dues or
assessments, while in less than 2 percent both employees and employer
contributed. Although payment of representatives out of employees’
dues was rare, it was somewhat more frequent when trade-unions
were also dealt with by the employer.
T able
2 0 , — Source
of payment of company-union representatives, April 1935
T o ta l w ith c o m p a n y u n io n s
E sta b lish
m e n ts
S ource of p a y m e n t
W ork ers
C o m p a n y u n io n s o n ly
E sta b lish
m e n ts
W orkers
C o m p a n y u n io n s an d
tra d e-u n io n s
E sta b lish
m e n ts
W ork ers
N u m P er N u m P er N u m P er N u m P er N u m P er N u m P er
ber
ber
cen t ber cen t
b er
ber cen t
cen t ber c en t
cen t
C o m p a n y ___________
E m p lo y e e s’ d u es or
a ssessm en ts----------J o in tly ---------------------Sou rce n o t rep orted .
T o ta l_________
91.8 422,679 92.9
3 .8 23,159 5.1
1.6 4,317
.9
2 .8 4,842 1.1
425 100.0 454,997 100.0
390
16
7
12
91.8 309,257 94.0
3.1 11,636 3 .5
2 .0 4,317 1.3
3,802 1.2
3.1
357 100.0 329,012 100.0
328
11
7
11
62
91.1 113,422
7.4 11,523
0
0
1.5
1,040
68 100.0 125,985
5
0
1
90.1
9.1
0
.8
100.0
General Membership Meetings
Of the 592 company unions covered by the Bureau’s question
naire, 86 had no provision for general membership meetings, either by
plant or department (table 21). In 96 cases there was no answer to
the question “ How frequently are general membership meetings
67
CHARACTERISTICS OF 592 COMPANY UNIONS
held?” These two groups combined included 50 percent of the
total number of workers in the establishments with company unions.
An additional 14.4 percent of the workers were in the 135 establish
ments that reported general membership meetings held on call only.
The 275 company unions reporting provision for regular meetings
embrace 35.6 percent of the employees. On the whole these estab
lishments were smaller than those whose plans made no provision for
a regular meeting time or for which no data were made available.
Monthly or annual intervals between meetings were most common,
monthly meetings being provided for by 158 company unions with
19.9 percent of the workers and annual meetings by 52 company unions
with 9.1 percent of the workers. Quarterly meetings were reported for
14 company unions in relatively small establishments. In 10 establish
ments, with a total of 10,323 workers, the company union was
reported as meeting weekly.
Comparison of frequency of meetings as between establishments
with company unions only and those with company unions and tradeunions shows some differences. In the group having both types of
collective dealing, 48 of 96 establishments had no reported provision
for regular meetings of the company union. These 48 establishments
included nearly three-fourths of the workers employed in the 96
plants. It should be noted, however, that in 40 of the 48 establish
ments reporting regular meetings and dealing also with trade-unions,
meetings were held at least monthly. These 40 establishments
employed about 90 percent of the workers in this group. Among the
227 establishments with regular meetings but with company-union
dealings alone, quarterly or less frequent meetings were held in 78
establishments with about two-fifths of the workers in such
establishments.
T
able
21.— Frequency of company-union general membership meetings, April 1935
T o ta l w ith co m p a n y
u n io n s
F re q u e n c y cf m eetin g s
P ro v isio n for regular m e e tin g _____
W e e k ly . ______ - __ __
S e m im o n th ly ,. ____
M o n th ly ___ ________ __
Q u a rterly ___ _____________ _____
S e m ia n n u a lly . - _
A n n u a lly _________ ______ . . . .
N o p ro v isio n for regular m e e tin g ._
O n c a ll_______________ _______
N o p r o v isio n ____ __
N o t rep orted ------------------------ -----T o ta l_________________________
E sta b lish m e n tr :
275
p a n y u n io n s a n d
C o m p a n y u n io n s o n ly C o m trad
e-u n ion s
W ork ers
W orkers
E sta b
E sta b
lish
lish
Per m e n ts
P er m e n ts N u m b e r P er
N u m b e r cen
cen t
cen t
t
W orkers
188,825
10 10, 323
21 9, 802
35.6
1.9
1.8
19.9
.9
2.0
9.1
50.3
14.4
35.9
14.1
158 105, 204
14
4,609
20 10, 418
52 47, 869
221 265, 738
135 76,016
86 189, 722
96 74, 570
592 528, 533 100.0
227 150,121 38.9
9
9, 716 2 .5
10 4,981 1.3
130 76, 289 19.8
12 4,284 1.1
20 10,418 2 .7
46 44, 433 11.5
192 178, 959 46 .4
117 62,853 16.3
75 116,106 30.1
77 56,874 14.7
496 385,954 100.0
48
38,104
1
607
11 4,821
28 28,915
2
325
6 3,436
29 86, 779
18 13,163
11 73, 616
19
96
17, 696
142, 579
26.7
.4
3 .4
20.3
.2
2 .4
60.9
9 .2
51.7
12.4
100.0
CHARACTERISTICS OF COMPANY UNIONS
68
Arbitration
Data obtained from the mail questionnaire indicated that in nearly
40 percent of the company unions arbitration was permissible when
management and employee representatives could not agree. These
company unions represented almost one-half of the workers covered
(table 22). Such provisions were somewhat more frequent in com
pany unions established under the N. R. A. than in those established
before 1933. Many of the replies indicated that the provisions did not
give the company union the right to secure arbitration on its own
request, but required mutual agreement.10
None of the replies mentioned any matter which had ever been
submitted to arbitration. The mail questionnaire bore out the evi
dence secured in the field study that arbitration provisions were never
or very rarely invoked by company unions.
T
able
22.— Arbitration provisions in company-union constitutions, April 1935, by
time of establishment of company union
A ll co m p a n y u n io n s
T im e of e sta b lish m en t
B efore N . R . A _ ____________
D u r in g N . R . A _______________
N o t r ep o rted ___________________
T o ta l __ ________________
E sta b lish
m en ts
197
378
17
592
W orkers
211,846
306, 528
10,159
528, 533
C o m p a n y u n io n s w ith P ercen t w ith arb itratio n
arb itratio n prov ision s
prov ision s
E sta b lish
m en ts
71
157
5
233
W orkers
111, 602
138,204
6, 664
256, 470
E sta b lish
m en ts
36 .0
41.5
29 .4
39.5
W orkers
52.7
45.1
65.6
48.6
Comments in the replies and provisions in the constitutions de
scribing how arbitrators were selected indicated a tendency to turn
to some prominent public official or agency in designating an arbitra
tor. Provision was often made to delegate this important responsi
bility to an outsider about whose personal qualifications the parties
could know little or nothing. They designated an office rather than
a person. While the person who held the office at the particular time
might have been acceptable to both parties, there was no certainty
that a person similarly acceptable would hold the office when the time
for arbitration arrived. Thus, one constitution provided that the
senior United States judge of the district should act as the arbitrator.
Another specified that the chairman of the State public-service com
mission should serve in this position. A third referred the disputed
question for settlement to the arbitration committee of the State
chamber of commerce.
Final decision on matters brought up through the company-union
machinery was reported as resting with a joint committee of manage10 T h e c o n ten t of arb itration p rov ision s in com p a n y -u n io n co n stitu tio n s an d th e e x ten t to w h ich th e y w ere
in v o k e d in p ractice are d iscu ssed in p t. I l l , ch. X V I.
CHARACTERISTICS OF 592 COMPANY UNIONS
69
ment and employee representatives in 31 cases, about 5 percent of the
company unions reporting to the Bureau. They included 3.5 percent
of the total workers. All but one of these were in establishments in
which a company union alone functioned. One chain of large units
vested final decision in a joint board which met once a year to handle
unsettled matters for all the units, decisions being reached by “ gen
eral agreement” under the unit system of voting. Aside from this
chain, the company unions vesting final decision in a joint body were
in small establishments.11
Matters Discussed
An analysis of the matters reported discussed between manage
ment and company unions is presented in table 23. Of the 592
establishments, all but 42 reported the subjects which had been dis
cussed in conference with representatives of the company unions
during the period since January 1, 1933. Ten leading subjects were
listed for checking in the Bureau’s questionnaire and only 12 com
panies reported discussion of other matters.
The number of establishments (and the number of employees)
in which these matters were discussed is shown in table 23. It must
be borne in mind that the frequency with which such subjects are
discussed is influenced by the trend of business activity. A study
made in the declining phase of a business cycle might reveal a different
order of importance. Furthermore, the questionnaire related only
to subject matter and shed no light on methods of presentation. The
field study revealed that in some instances such discussions involved
actual negotiation, but in many instances little more than an an
nouncement of company policy was involved.12
Based upon the percentage of all establishments which have com
pany unions, the subjects ranked as follows:
1. Individual grievances and complaints.
2. Health and safety.
3. General wage increase or decrease.
4. Wage rates for specific occupations.
5. Changes in weekly or daily hours.
6. General rules and regulations.
7. Methods of sharing or rotating work.
8. Discharge of an employee or employees.
9. Rules of seniority.
10. Type of wage payment.
11T h e p ractical fu n ctio n in g o f join t com m ittees is d iscu ssed in d eta il in p t. I l l , ch. X I I I .
12 See
ch s. X V I I an d X V I I I .
T
able
23.— Matters reported discussed by company unions with management between January 1933 and April 1935
<1
O
[N u m b ers in p aren th eses in d ica te order o f freq u en cy , b y n u m b er of esta b lish m en ts]
C o m p a n y u n io n s o n ly
T o ta l co m p a n y un ion s
M a tter d iscu ssed or n eg o tia ted
E sta b lish m en ts
In d iv id u a l grieva n ces an d c o m p la in ts________________
H e a lth an d sa fe ty _______________________________________
G en eral w a g e in crea ses or d ecrea ses----------------------------W a g e ra tes for sp e c ific o c c u p a tio n s____________________
C h a n g es in w e e k ly or d a ily h o u r s_____________________
G en eral r u le s a n d r eg u la tio n s__________________________
M e th o d s o f sh a rin g or ro ta tin g w o r k __________________
D isch a rg e o f an e m p lo y ee or e m p lo y e e s_______________
R u le s o f se n io r ity _______________________________________
T y p e o f w a g e p a y m e n t (p iece w o rk , b o n u s, e tc .)____
O th e r ._______ _____ ______ _______________ ________________
B o th general w ag e ch an g es an d ch an g es in h o u rs____
N e ith e r of a b o v e 2 m a tte r s_____________________________
G eneral w a g e ch an ges, ty p e o f w a g e p a y m e n t, an d
ch an ges in h o u rs______________________________________
N o n e of ab o v e 3 m a tte r s._____ ______ __________________
A ll esta b lish m en ts w ith c o m p a n y u n io n s_____________
455
386
384
377
357
334
317
288
253
244
P ercen t
76.9
65 .2
64.9
63.7
6 0 .3
56 .4
53.5
48 .6
4 2 .7
41. 2
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
12 2.0 (11)
294 49 .7
142 24.0
178 30.1
79 13.3
592
N u m b er P er c en t N u m b e r
467, 777
420, 739
371, 474
426,895
368,168
374, 810
365, 591
377, 554
348, 602
322, 841
34,512
323,041
99,415
260,562
63, 902
528, 533
88 .5
79 .6
70 .3
8 0 ,8
6 9 .7
7 0 .9
6 9 .2
7 1 .4
66.0
61.1
6 .5
61.1
18 .8
49.3
12.1
378
332
318
303
303
286
284
234
214
219
8
244
117
159
72
496
P ercen t
76 .2
6 6 .9
6 4 .1
61 .1
61 .1
57 .7
57.3
4 7 .2
43 .1
4 4 .1
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(10)
(9)
1.6 (11)
49 .2
23.6
32.1
14.5
E sta b lish m e n ts
W orkers
N u m b e r P er c en t N u m b e r
343, 749
314, 449
284,176
313, 660
282, 918
283, 056
288, 403
284, 996
267, 378
258, 663
8, 372
242, 779
53, 111
203,689
32, 324
385,954
89.1
81 .5
73.6
81.3
73.3
73 .3
74.7
7 3 .8
69 .3
6 7 .0
2.2
62.9
13.8
52 .8
8 .4
77
54
74
54
48
33
54
39
25
4
50
25
19
7
96
P ercen t
80 .2
56 .3
77.1
5 6 .3
5 0 .0
34.3
56 .3
4 0 .6
26. 0
4 .2
52.1
26 .0
19.8
7.3
(1)
(4)
(2)
(6)
(7)
(9)
(5)
(8)
(10)
(11)
66 68.8 (3)
W orkers
N u m b e r P er c en t
124,028
106, 290
8'7', 298
113, 235
85, 250
91, 754
77,188
92, 558
81, 224
64,178
26,140
80, 242
46,304
56,873
31, 57 8
142, 579
8 7 .0
74 .5
61.2
7 9 .4
59 .8
6 4 .4
54.1
64 .9
57 .0
4 5 .0
18.3
56.3
32.5
40 .0
22.1
CHARACTERISTICS OF COMPANY UNIONS
N u m b er
E sta b lish m e n ts
W orkers
C o m p a n y u n io n s an d trad e-u n ion s
CHARACTERISTICS OF 592 COMPANY UNIONS
71
When a comparison is made of the relative prevalence and ranking
of the matters discussed with their employees by establishments deal
ing with company unions only and by establishments dealing with
both company and trade-unions, marked differences in emphasis are
revealed. Thus, while individual grievances and complaints ranked
first for both groups, the percentage of establishments with only com
pany unions in which such matters were discussed with their employees
was 76.2 percent. In establishments with both company unions and
trade-unions, 80.4 percent reported that individual grievances were
handled. Likewise, while health and safety ranked second with the
group having company-union dealings alone (66.9 percent of such
establishments), it ranked fourth with the group with mixed dealings
(56.7 percent). General wage increases and decreases ranked third
with both categories, but was reported as discussed in a somewhat
larger proportion in the establishments with dual dealings. Wage
rates for specific occupations was fourth in order of prevalence for
company unions alone and second for establishments dealing with
trade-unions also. The matter of sharing or rotating work ranked
seventh with 57.3 percent of the establishments dealing with com
pany unions alone and ninth with 35.1 percent of the establishments
dealing also with trade-unions. The discharge of employees was
a subject of conference with company unions in 47.2 percent of the
establishments dealing with company unions alone and with 55.7
percent of the establishments also dealing with trade-unions. Types
of wage payment were discussed with company unions in a larger
proportion of establishments dealing with company unions alone than
of those dealing also with trade-unions— 44.1 percent and 25.8 percent,
respectively.
Since general wage changes, type of wage payment, and changes in
hours of employment are fundamental matters involved in employeremployee dealing, it was deemed desirable to ascertain the frequency
with which employers discussed all three matters or failed to discuss
any one of them with company unions. Thirty percent of all the
establishments with company unions, employing 49.1 percent of the
workers covered, reported that they conferred with company unions
on these three important matters. On the other hand, 13.3 percent
of all the establishments, employing 12.0 percent of the workers, did
not discuss any of the three subjects. In general these matters were
more frequently discussed with company unions in establishments
dealing with company unions alone than they were in establishments
dealing also with trade-unions. This was largely traceable to the fact
that discussion of type of wage payment was reported more frequently
by the former than the latter. Wages and hours were discussed by
approximately half of the company unions in each group, while neither
72
CHARACTERISTICS OF COMPANY UNIONS
wages nor hours were discussed by approximately one-fourth in each
group.13
Company-Union Agreements
Of the 592 establishments dealing in part or whole with their workers
through company unions, 82 or 13.9 percent had written agreements.
These 82 establishments employed 55,412 workers or 10.5 percent of
the total number of workers employed by the 592 establishments.
Copies of the written agreements were submitted by 36 of the 82
establishments. Nineteen of these agreements followed closely along
trade-union agreement lines. They contained provisions similar to
those generally found in such agreements in regard to wage scales,
hours, working conditions, arbitration clauses, and special industrial
problems. Of these 19 company-union agreements, 4 were identical
with the agreements that these same establishments had with tradeunions. Three of these were entered into with American Federation
of Labor unions and one with a local of the Industrial Workers of
the World.
Of the 86 companies which submitted agreements, 9 had agree
ments limited to the affirmation of the N. R. A. codes under which
the particular establishment operated. Eight contained declarations
of mutual good will and an enumeration of how the workers can
organize for conference with the employer— matters ordinarily incor
porated in the company-union constitution. No mention was made
in these 17 agreements of wages, hours, and working conditions.
Outside Contacts
Approximately 22 percent of all the company unions, including
30 percent of the workers, were reported as having contacts with
company unions in other plants of the same company (table 24).
The contacts ranged through all degrees of formality and regularity. A
number of companies reported that formal contacts between the
company unions in their different establishments were consistently
maintained. In a few cases the establishments so connected were
widely separated geographically. Annual joint meetings of employee
representatives were the general rule in such cases. On the other
hand, one large company with more than 15 company unions in as
many establishments, and employing more than 38,000 workers,
stated that—
Each works council is a self-governed unit, and although the council plan pro
vides for general councils comprised of representatives of the various works
councils, there has been no recent need for such joint meetings of representatives
of the councils, nor has there been any occasion where a meeting of our represen-
13 F or a com p a rison w ith th e resu lts in d ic a te d b y th e field stu d y , see p . 163, footn ote 2. T h e d iscu ssion
th ere su g gests certain corrections in th e figures on h ou rs of w ork an d ty p e of w ag e p a y m e n t.
CHARACTERISTICS OF 592 COMPANY UNIONS
73
tatives with those of another company would have been necessary or of particular
advantage to either group.
Another company reported that the bylaws provided for meetings
of representatives of the different plants when necessary, but no such
meetings have been held to date.
Contacts with company unions in other companies were relatively
much less frequent than contacts within the same company. The
total of company unions with external contacts includes 15 compa
nies dealing through the Loyal Legion of Loggers and Lumbermen,
which is here classed as a company union. Four companies were
connected with the American Guild of the Printing Industry in Balti
more and one with a federation of printing shops in Boston. Two
others handled their labor relations through the Joint Board of Arbi
tration in the shoe industry in Philadelphia. These 22 company
unions are the only ones with clearly defined contacts with other
company unions in companies not financially affiliated with the
establishments in question. In addition, 6 establishments reported
that their employees had some loose contact with employees and
organizations in other companies through correspondence or plant
visitation, but these cases are not included here.
T able 24.— Contacts of company unions with company unions in other establish
lishments, April 1935
T o ta l
T y p e of u n io n
C o n tact w ith other cornp a n y u n io n s in sam e
co m p a n y
E sta b lish
m en ts
E sta b
lish W orkers
m en ts
N u m P er
ber cen t
E sta b lish m e n ts w ith —
C o m p a n y u n io n s o n ly ____
C o m p a n y u n io n s an d
tra d e -u n io n s. .......................
T o ta l______ ______ _______
496
96
692
385,954
142, 579
528, 533
W orkers
N um
ber
1 101
20 .4 1116,619
30 31.3 43, 897
1 131 22.1 1160, 516
1In a d d itio n , 1 c o m p a n y w ith 19 co m p a n y u n io n s in
w orkers, rep orted for a ll th ese co m p a n y u n io n s th a t
p la n t h a v e con tact w ith th o se of an o th er” , b u t it w a s
th e esta b lish m en ts th e sta tem e n t h a d reference. T h e
rep ortin g con tacts.
C o n ta ct w ith c o m p a n y
u n io n s in oth er com
p a n ies
E sta b lish
m en ts
W orkers
P er N u m P er N u m P er
cen t
cen t ber cen t ber
30.2
30.8
30.4
41
8 .3
8 8 .3
49
8 .3
34,002
9,495
43, 497
8.8
6 .7
8.2
as m a n y e sta b lish m e n ts, em b racin g a to ta l of 21,880
“ in so m e in sta n ces, e m p lo y ee rep resen ta tiv es o f 1
im p o ssib le to d eterm in e from th e r e p ly to w h ic h of
en tire ch ain is, therefore, ex clu d ed from th e group
Personnel Managers
Personnel managers handled employer-employee relations in almost
half of the establishments in which company unions functioned.
The presence of both personnel managers and company unions was
twice as common in establishments having more than 500 workers as
in those with less than that number.
1 54 8 7 5°— 38-
-6
74
T able
CHARACTERISTICS OF COMPANY UNIONS
2 5 , — Establishments
with personnel managers, by size of establishment
April 1935
N u m b e r of w orkers
T o ta l
U n d er 500______________________________ _____ _
500 a n d ov*er______________ _____________________
T o ta l______________________________________
1D a ta
268
179
i 447
W ith p erson n el
m an a ger
N um ber
W ith o u t p erson n el
m an ager
P ercen t
81
124
205
N um ber
32.1
63.6
45 .9
187
55
242
P ercen t
67.9
36.4
54.1
n o t av a ila b le for 145 oases, of w h ic h 101 h a d less th a n 500 w ork ers a n d 44 m ore th a n tha,t n u m b er.
Combinations of Attributes
Seventeen company unions were reported as possessing simultane
ously the attributes of dues, regular employee meetings, written agree
ments, contacts with other workers* organizations, and the right to
ask arbitration of differences whereby the management relinquishes its
absolute veto power. The total number of workers in these establish
ments was 9,403, or 1.8 percent of all workers in the establishments
with company unions. On the other hand, 76 of the company unions,
or 12.8 percent of the total, exhibited none of these features. These
76 plants employed 17.7 percent of the total number of workers in
establishments with company unions.
Various combinations of these attributes appeared as indicated in
table 26.
T able 2$.— Combinations of attributes among company unions studied, April 1935
C o m b in a tio n s of a ttrib u tes
D u e s, regu lar em p lo y ee m eetin g s, w r itten ag reem en ts, c o n ta cts
w ith oth er w ork er organ ization s, a rb itra tio n ____________________
D u e s, regu lar e m p lo y ee m e etin g s, w r itte n ag reem en ts, arb itra
tio n _________ ______ _________________________________ ______ _________
D u e s, regular em p lo y ee m eetin g s, w r itten agreem en ts____________
D u e s, regu lar e m p lo y ee m e etin g s, a rb itra tio n _____ _______________
D u e s, regu lar e m p lo y ee m e etin g s......................................................................
N um ber
of com
pany
u n io n s
17
28
36
48
141
P ercen t
o f to ta l
2 .9
4 .7
6.0
8.0
23.8
N u m b e r P ercen t
o f w ork o f to ta l
ers
9,403
17,496
21,075
31,644
87, 516
1.8
3 .4
4 .0
6.0
16.6
PART III
Organization and Functioning o f 126 Company Unions
75
Organization and Functioning of 126 Company Unions
Supplementing the mail inquiry, the results of which have been
presented in part II, members of the Bureau’s staff visited 125 firms
in which 126 company unions existed. They interviewed employers,
personnel directors, officers and members of the company unions,
trade-union members, and local citizens who were interested in
employer-employee relationships. Copies of minutes of meetings,
constitutions, agreements, and other pertinent literature were obtained.
The analysis in part III is based on the results of these visits. (See
appendix V for details on scope and method of this field study, as
well as for a copy of the schedule used by the field representatives.)
Part II is primarily a quantitative study of the various types of
employer-employee dealing and the characteristics of company unions.
Part III is a detailed analysis of the structure and functioning of
company unions as revealed by first-hand contact.
77
Chapter YI
Conditions Attending the Formation of Company Unions
An understanding of the characteristics of any particular institution
is aided by a consideration of the forces leading to and the events
attending its establishment. The period in which it was formed and
the factors in the immediate situation out of which it arose shed some
light upon the essential nature of the organization.
During the 20 years in which company unions have been a factor in
labor relations, industrial conditions have varied greatly. They
embrace the war period, a rather bitter subsequent adjustment period,
7 years of prosperity, 4 years of severe depression, and the rush and
experimentation of the N. R. A .1 These industrial conditions have
stimulated or retarded the development of company unions.
T
able
2 1 . — Period
of formation of company unions covered in field study
P eriod of form ation
1915-19___________________________________
1920-22___________________________________
1923-29____________________________________
N u m b e r of
co m p a n y
u n io n s
14
9
6
P eriod o f form ation
1930-32____________________________________
1933-J u ly 1935____________________________
T o ta l______________________________
N u m b e r of
com pany
u n io n s
1
i 96
126
1 See footn ote 3.
The formation of company unions has concentrated in certain
of these periods.2 Thus more than three-quarters of the 126 company
unions visited date 3 from the period of the N. R. A. (See table 27.)
1 A fuller d iscu ssion of th e p eriod s before M a rch 1933 h a s b een p resen ted in th e H isto rica l In tro d u ctio n ,
ch s. I an d II.
2 S ee p t. II, ta b le 7, p . 51.
3 A lm o st all o f th e c o m p a n y u n io n s stu d ie d w ere created fu ll-fled ged in a m ore or less d efin ite form . It is
th erefore p o ssib le to a llo cate th eir in itia tio n w ith so m e d efin iten ess to a p a rticu lar tim e p eriod .
A t le a st fiv e of th e c o m p a n y u n io n s cov ered in th is su r v e y , h o w ev er, w e n t th ro u g h a p rocess o f e v o lu tio n
from a m ore or less in form al b eg in n in g . T h e d a te of th is b eg in n in g is u n k n o w n in tw o cases, in o n e it goes
b a ck to 1924, in th e oth ers to th e p eriod ju st before th e W orld W ar. In th ese few cases th e d a te o f th e organi
za tio n of th e co m p a n y u n io n h a s b een ta k e n as th e first d a te w h ic h seem ed to m ark th e se ttin g u p o f a m ore or
less form al rep resen ta tiv e a g en cy for th e w ork ers. T h u s, a lth o u g h sev eral of th e c o m p a n y u n io n s h a v e a
d ev elo p m en ta l h isto r y carryin g b a ck to th e pre-w ar period, n o n e is in d ica ted as h a v in g b een form ally in iti
a ted before 1915.
A slig h tly differen t p rob lem of d a tin g ap pears w h ere c o m p a n y u n io n s in existen ce a t o n e tim e or an oth er
h a d b een ab a n d o n ed an d th en , in th e period of co m p a n y u n io n a c tiv ity b eg in n in g in 1933, n e w or rev ised
p la n s w ere se t u p . In four cases th e c o m p a n y u n io n h a d b een d ead for so m e tim e before 1929. T h e n e w
p la n s in th ese 4 cases w ere c o n se q u e n tly d e fin ite ly assign ed to th e p eriod from 1933 to 1935. In four oth er
cases th e c o m p a n y u n io n h a d d ro p p ed in to in a c tiv ity so m etim e b e tw e e n 1929 a n d 1933. I n tw o ad d itio n a l
cases th e co m p a n y u n io n h a d su r v iv e d in to th e N . R . A . p eriod , to b e rep laced tem p o ra rily b y a trad e-u n io n .
A lth o u g h th ese la st six c o m p a n y u n io n s w ere reesta b lish ed in th eir p resen t form d u rin g th e p eriod of th e
N . R . A . an d are assign ed to th a t p eriod in ta b le 27, th e y h a d a h isto r y an d a tra d itio n of e m p lo y ee rep resen
ta tio n go in g b a ck a d ecad e or m ore.
78
FORMATION OF COMPANY UNIONS
79
The next largest group, with about 11 percent of the total number of
the company unions surviving 4 in 1935, dates from the war period.
Only one dates from the depression period of 1930-32.
C om pany-un ion organization under N . R . A .— Most of the 96
company unions which came into being during the N. R. A. period
were created in companies which had had no previous experience
with company unions. About a quarter of the organizations estab
lished in this period represented an attempt to build on long-abandoned
plans or to expand the scope of existing organizations which had
had more limited functions. Thus four war-time company unions
had been dropped long before 1929, but new company unions were
set up in these companies during the N. R. A. Four others established
during the twenties, had become moribund after 1929 but were
reestablished or set going again. In nine other companies, enactment
of N. I. R. A. turned attention to the existing benefit associations
and the possibility of utilizing them as agencies for collective bar
gaining.6 Eight company unions which were in more or less active
operation at the time of the adoption of N. I. R. A. were revised in
response to the new legislation.
In more than half of the cases of company unions formed during
the N. R. A. period, recently established trade-union locals contended
for the right to represent the workers. In these cases, there had
been no agency for collective dealing before March 1933. The
sequence of events in the great majority of these cases indicated
4
T h e m a il su r v e y in d ica tes th a t 32.5 p ercen t of th e c o m p a n y u n io n s w ere esta b lish ed before 1933. T h e
sm aller p rop o rtion in th e field s tu d y is d u e in p a rt to th e ex clu sio n of c o m p a n y u n io n s in lu m b er from th e
field stu d y . S u ch c o m p a n y u n io n s, alm o st a ll o f w h ic h w ere se t u p before 1933, com p rised 3.4 p ercen t o f th e
m a il-stu d y c o m p a n y u n io n s. I n a d d itio n , ab a n d o n ed c o m p a n y u n io n s w h ic h w ere reestab lish ed after
th e passage o f th e N . I. R . A . w ere in clu d ed w ith th e N . R . A . group in th e field stu d y . T h e y com p rised
5 p ercen t of th e field -stu d y c o m p a n y u n io n s. In th e rep lies to th e m a il q u estion n a ire, m a n y if n o t m o st
of th ese c o m p a n y u n io n s w ere p r o b a b ly d a ted b y th e yea r o f th eir first organ ization .
If allo w an ce is m a d e for th ese tw o groups, th e co m p a n y u n io n s ch osen b y th e B u reau for in te n siv e field
stu d y seem to rep resen t fairly w ell, from th e sta n d p o in t of age, th e larger group w h ic h rep lied to th e m ail
q u estion n a ire.
T h e se figures g iv e o n ly th e ap p ro xim a te rate a t w h ic h co m p a n y u n io n s w ere organized in th e differen t
periods. T h e y in d ica te th e age o f th e existin g p la n s an d th e p eriod in w h ic h th e su r v iv in g p la n s origin ated .
It is w e ll k n o w n th a t th e m o r ta lity rate am o n g co m p a n y u n io n s h a s b een h ig h an d h as va ried w ith eco n om ic
an d oth er co n d itio n s.
6
In tw o o f th ese n in e co m p a n ies, organ ization s se t u p as sa fe ty an d efficien cy su g gestion sy ste m s a n d , in
th ree oth ers, w elfare association s w ere co n v erted in to rep resen ta tiv e agen cies to perform fu n ctio n s m ore
c lo se ly rela ted to c o lle c tiv e b argain in g. In tw o oth er com p a n ies it w a s a tte m p te d to h a v e th e w elfare
asso cia tio n a ssu m e b arg ain in g fu n ctio n s. W h e n th ese efforts p r o v ed u n su ccessfu l, n e w organ ization s w ere
se t u p . I n o th er cases, e x istin g organ ization s o f a w elfare or a th le tic n a tu re, w h ile n o t tran sform ed in to
broader ag en cies, w ere u tilize d as a sp rin gb oard for th e in itia tio n o f n e w p la n s. M e e tin g s of th ese organi
za tio n s w ere u se d as occasion s for sta rtin g in terest in or a c tu a lly in itia tin g m easu res for th e se ttin g u p of a
c o m p a n y u n io n .
O n th e oth er h a n d , in so m e cases m an a g em en t d e fin ite ly d ecid ed n o t to co m b in e th e c o m p a n y u n io n
org an ization w ith th e p reex istin g b en efit association . T h e reasons for th is w ere co n c ise ly sta te d b y on e
p erso n n el m anager:
“ W e d ecid ed n o t to co m b in e th e b en efit a ssociation a n d th e b argain in g organ ization for th e fo llo w in g
reasons: (1) T h e b a d n a m e w h ic h m u tu a l b en efit association s h a v e as collectiv e-b a rg a in in g agencies; (2) th e
gro u p in su ra n ce p la n o f th e b en efit a ssociation is co m p u lso ry for all em p lo y ee s a n d th e c o m p a n y d id n o t
w ish th e rep resen tation p la n to h a v e a n y co m p u lso ry features; (3) th e co m p a n y d id n o t w ish to h a v e th e
grou p in su ra n ce ta k e th e ch an ce of failin g if rep resen tation f a ile d /’
80
CHARACTERISTICS OF COMPANY UNIONS
that the trade-union had appeared on the scene first and had tried
to establish itself as the bargaining agency for the employees.6 The
company union appeared either immediately following the trade-union
or after the lapse of some time. In some cases the new trade-union
local was more or less completely eradicated following the establish
ment of the company union. In other instances, the trade-union
continued to function more or less effectively but the company union
received recognition by the company as the sole bargaining agency
or as entitled to equal recognition with the trade-union.
A reverse movement also took place, though its extent cannot be
established from a study of company unions in existence in 1935.7
In a few instances the company union was either captured or dis
placed by trade-unions. In other cases the displacement of the
company union by the trade-union was only temporary. When the
N. I. R. A. company union in one firm voted to affiliate with a tradeunion, management laid off the leaders of the trade-union movement
who were officers of the company union and selected new officers. In
another case, management influenced the workers through a series
of conferences to bring about the return of the company union that
had existed previously for 10 years but had been supplanted by
trade-union organization in 1933. In two instances a company
union, displaced by a trade-union, was subsequently in turn replaced
by the company union when the trade-union called a strike.
The ever changing situation with respect to company unions in
the N. R. A. period is further indicated by the cases in which com
pany unions established or reestablished after March 1933 were
subsequently more or less drastically revised.8 One company union,
for example, adopted four different constitutions in the space of
about 2 years.9 These revisions were in the direction of increased
employee control of the company union and decreased management
participation. They represented a response to legislation and other
statements of public policy, the rulings of labor boards, and the
increased activity of the trade-union movement.
Influences and pressures leading to com pany-union organization .—
Four factors have been of outstanding importance as far as the
conditions facing the individual companies at the time of the forma
tion of the company unions were concerned: (1) Strike situations;
(2) trade-union activity in the particular plant or in the locality;
6 See ch. X X I I , p . 191, for fu rth er d iscu ssio n of order in w h ic h organ ization s ap p eared u n d er N . It. A .
7 A s tu d y o f co m p a n y u n io n s e x istin g a t a n y p a rticu lar tim e d oes n o t in d ica te, o f course, th e a m o u n t an d
cau ses o f m o r ta lity d u rin g p rev io u s p eriod s. T h u s, th is stu d y , m a d e in A p r il-J u n e 1935, c a n n o t rev e a l th e
ex ten t to w h ich co m p a n y u n io n s se t u p before th a t tim e h a d su ccu m b ed to a d v a n cin g u n io n iza tio n or th e
decrees o f G o vern m en t board s sin c e M a rch 1933.
8 F ifty -o n e o f th e c o m p a n y u n io n s stu d ie d rep orted so m e ch an g e in stru ctu re or proced u re after M a rch
1933. W h ile m a n y of th ese w ere m in or an d o n ly on a few m atters d id m ore th a n a few c o m p a n y u n io n s sh o w
th e sa m e ty p e o f ch an g e, a m ore or less d efin ite tren d em erges o u t o f th e ch an ges.
• See a p p en d ix III , p . 273.
81
FORMATION OF COMPANY UNIONS
(3) a desire to comply with section 7(a) of the N. I. R. A., which was
widely interpreted as making necessary some form of organization of
employees; and (4) a desire to improve personnel relations without
any significant stimulus from external forces.
The weight of evidence indicates that activity of trade-unions among
the workers in the plant or in the community was the most important
DOMINANT FACTORS AT TIME OF FORMATION
OF COMPANY UNIONS
U. S. BUREAU OF LABOR STATISTICS
factor in 52 cases; the influence of the N. I. R. A. in 31 cases; a strike
or recent strike in 28 cases; and desire for improved personnel rela
tions, not closely related to any of the other 3 factors, in 14 cases.10
The relative significance of these factors, however, has varied with
the several periods.
T able 38. — Labor conditions at time of formation of company unions
D o m in a n t labor con d itio n s
S trik e in progress or r ecen tly se ttle d ______________ ___
T ra d e-u n ion s m a k in g h e a d w a y in p la n t or lo c a lity ____
N . I. R . A . in flu en ce______________________________________
C o m p a n y d esire to im p ro v e p erson n el r ela tio n s_______
N o in fo rm a tio n ______________________________ ___________
T o ta l................................................. ...............................................
T o ta l
28
52
31
14
1
126
1915-19 1920-22 1923-29 1930-32
5
2
0
6
1
14
7
0
0
2
0
9
2
0
0
4
0
6
1
0
0
0
0
1
1933J u ly
1935
13
50
31
2
0
96
io T w o or m ore o f th ese factors w ere p resen t in m a n y cases, a n d it w a s d ifficu lt to assign th eir rela tiv e
im p o r ta n c e . T h is w a s e sp e c ia lly tru e w ith resp ect to th e rela tiv e in flu en ce o f th e N . I. R . A . an d o f tradeu n io n a c tiv ity in th e c o m p a n y or lo c a lity . T h e d ecision as to w h ic h w a s d o m in a n t w a s m a d e in each case
b y ta k in g th e w h o le sto r y o f th e fo rm a tio n in to accou n t an d siftin g th e e v id en ce w h ic h th e field agen ts
o b ta in ed in th eir in ter v iew s w ith m an a g em en t, e m p lo y ee rep resen tatives, ran k a n d file, tra d e-u n io n e m
p lo y e e s an d rep resen ta tiv es, an d oth ers w h o w ere in terested in an d h a d so m e k n o w led g e o f th e situ a tio n .
82
CHARACTERISTICS OF COMPANY UNIONS
Improving personnel relations— A s far as can be judged, in 14 of
the 126 company unions studied, the chief factor in the labor situation
at the time of the establishment of the company union was not external
pressure from trade-unions or legislation but rather the desire of man
agement for improved personnel relations.11 This motive was of
special importance in the period from 1923 to 1929, and was also
very significant in the war period. Whereas it was dominant in
two-fifths of the company unions set up prior to 1933, it was of major
influence in only 2 out of the 96 company unions established or reestab
lished during the N. R. A.
In these 14 concerns, company unions were instituted as a means
of establishing closer contact with employees. Insofar as can be
judged from the company unions studied, those which had this
background emphasized the elimination o f . individual employee
grievances, arising in day-to-day working contacts, which destroyed
morale and interfered with efficient work. They were planned largely
to provide a channel of communication between employees and
management so that injustices might come to light. This was a
part of the philosophy of scientific management, a method of reducing
industrial and human waste.
One company announced its plan as follows:
* * * the management feels that a means should be provided whereby the
more important matters which affect employees in general should have mutual
discussion prior to the final decision by management.
As there is no regularly constituted medium for discussion of this kind,
it has been decided to ask the ---------- employees
* * * to elect
representatives * * *.
An official of another company in which the company union was
reorganized after March 1933 said:
The old plan was only for discussion, like most such plans * * *. The
majority of management decided (in 1933) that it should be revised as a genuine
plan— for settlement, not just discussion.
Some of these 14 company unions were formed in plants in which
the owner or someone in authority was unusually anxious to maintain
good labor relations. One came into being because of the bequest
of the voting stock of the company to its employees by the president.
Another grew steadily in power and independence and has not only
been tolerated but encouraged and advised by the president of the
company, who is known to be a “ sincere and idealistic employer.”
Another was established by an officer “ who was interested in that
sort of thing” and who has sincerely cooperated with the company
union although it has become quite independent of the company.
11 H ere as elsew h ere, several factors m a y h a v e op erated a t th e sa m e tim e. I t is k n o w n th a t in several
con cern s w h ere th e p o in t o f v ie w o f scien tific p erson n el m an a g em en t w a s p red o m in a n t in th e lab or s itu a tio n
th er e h a d b een recen t a tte m p ts a t u n io n iza tio n or strik es.
FORMATION OF COMPANY UNIONS
83
Conform ing to law and public opinion. — During the period of the
N. R. A., one-third of the company unions were established chiefly
to comply with the law, in letter or in spirit. While the possibility
of trade-union growth in these industries played a part, it does not
seem to have been the primary factor in these particular establish
ments. In many cases the encouragement to employees to form a
company union sprang from a desire to live up to the standards
seemingly set by public opinion as well as the law. It was generally
felt, at least during the first months of the N. I. R. A., that individual
bargaining with employees could no longer be unquestionably ac
cepted. A number of these company unions included in their consti
tutions specific references to collective bargaining or collective dealing.
Special conditions affected the establishment of the company union
in some of these cases. In a few the personnel director or someone
in the organization had wanted a company union for a long time, but
those in authority had been opposed. Some who had long opposed
company unions changed their position in the early months of the
N. R. A., even where the probability of trade-union bargaining was
not very great. One company felt that the existence of a collective
bargaining agency would put it in a more favorable position to secure
some Government contracts on which it had bid. It sent out a notice
to employees to the effect that everyone was expected to conform to
section 7 (a). The company, according to workers interviewed, gave
the employees the impression that it was more or less necessary to
have an organization in order to get the bids. In a number of in
stances, where the company had a large number of local units, central
headquarters of the company, after the enactment of the N. I. R. A.,
sent out a uniform company-union constitution to the various
individual establishments.
Strikes and trade-unions as stimulating factors .— Strikes were a factor
in company-union organization in all periods. They were of greatest
relative importance among the company unions which dated from the
war and post-war periods. Trade-unions in the United States reached
their peak strength in 1920. They resisted wage cuts and other
losses. Many of the strikes which were called in 1920-22 not only
failed to ward off wage cuts but were followed by the decimation of
local trade-unions. The company union was an alternative offered
the dissatisfied workers.
In nearly two-thirds of the 126 cases the most immediate influence
leading to the formation of the company union was apparently the
activity of trade-unions. Fifty-two were established when the tradeunion organizer had already swung into action or was just around
the corner. Thus in one instance the company union was set up
shortly after the Regional Labor Board had held hearings on the
trade-union’s charge that the company had refused to recognize the
84
CHARACTERISTICS OF COMPANY UNIONS
trade-union. In another, some employees had asked the American
Federation of Labor for help in forming a local and had succeeded
in signing up 75 percent of the workers in one division. The company
thereupon called a meeting of the employees and outlined a proposed
company union. Almost all of the company unions in which tradeunion organization was the dominant driving force were formed in
the period after March 1933, which witnessed the first significant
increase in trade-union activity since the World War.13
Twenty-eight were set up when a strike was in progress or soon
after a strike had been settled. The company union thus appeared
on the scene as an alternative to a trade-union which had made its
influence felt in the plant or locality.
While the philosophy of company unionism stresses harmony of
interest between workers and management, new company unions
were, for the most part, not formed in periods of peace but in periods
of struggle. When the trade-union movement was weak, as it was
from 1923 to 1932, the formation of company unions declined. Over
the period of 20 years, the threat of unionism, frequently evidenced
by strikes, was the most impelling force in the establishment of twothirds of the company unions. While the passage of such legislation
as the N. I. R. A. gave impetus to company-union formation, it was
the actual presence of trade-union agitation which encouraged most
of the swing toward company unionism. During the N. R. A.
period, the number of company unions organized following a strike
or while trade-unions were making headway in the plant or locality
was twice as great as in instances where there was no strong or evident
trade-union activity.
is F ro m th e figures h ere p resen ted , h o w ev er, w h ic h are con fin ed to c o m p a n y u n io n s in existen ce in 1935,
it ca n n o t b e con clu d ed th a t tra d e-u n io n org an ization m a y n o t h a v e b een a m ore im p o rta n t stim u lu s to th e
esta b lish m e n t o f c o m p a n y u n io n s in oth er p eriod s, e sp ecia lly d u rin g th e w ar p eriod , th a n ap pears from
th ese figures. I t is q u ite p o ssib le th a t c o m p a n y u n io n s esta b lish ed for th e p u rp ose o f cou n tera ctin g tradeu n io n in flu en ce m e re ly su ffered a greater m o r ta lity d u rin g th e e n su in g yea rs. In all p ro b a b ility , m a n y
of th e w ar-p eriod c o m p a n y u n io n s g ra d u a lly d isb a n d ed as tra d e-u n io n aggressiv en ess d eclin ed . T h e
su r v iv a l rate m a y h a v e b een h ig h er if th e c o m p a n y u n io n w a s set u p after tra d e-u n io n organ ization h ad
d ev elo p ed su fficien tly to b e a b le to call a strik e.
Chapter YII
How Company Unions Are Established
It is frequently difficult to know how and where the impulse for a
company union actually starts. Even though the idea may originate
in the office of the president or the personnel director, he seldom carries
through the establishment of the company union alone. Instead, he
sells the idea as completely as possible to the employees or to influential
groups and stimulates them to take a leading part in its organization.
Thus a member of management may be the real directing force behind
the scenes, but the company union may appear to have been granted
to satisfy employee demand.
On the other hand, the request for a company union may truly
originate with a group of employees who may fear or dislike tradeunions, or who may be convinced that a company union is the best
solution for the labor situation of the concern, or who may hope to
win favor from management. Even when employees take the initia
tive, however, they usually seek the assistance of management.
The influence of the employer is always an important factor. It is
increased in a period characterized by general economic insecurity for
the workers. The mere fact that the employer has proposed or sug
gested the formation of a company union gives it a certain advantage.
To some workers, this approval is a guarantee of its utility; to others,
it implies a veiled threat of discrimination against those who do not
accept the company’s suggestion.
Management's role in initiating company unions .— About 80 percent
of the company unions were originated solely by management.1
(See table 29.) In 18 of the management-initiated cases, the initiative
did not come from the management of any particular plant. Instead,
the plan had been sent out by the central headquarters, to be put
into operation as a separate company union in each subsidiary plant.
1
M a n a g em en t in itia tiv e in organ izin g a co m p a n y u n io n w a s m ore com m on am o n g th e a u to m a tic p a rtici
p a tio n th a n th e o p tio n a l m em b ersh ip ty p e . (S ee ch ap ter X for d escrip tio n o f th ese ty p e s.) T h u s, o f th e
68 a u to m a tic p a rticip a tio n c o m p a n y u n io n s, 91 p ercen t w ere in itia te d so lely b y m a n a g em en t. M a n a g e
m e n t a ctio n in in itia tin g c o m p a n y u n io n s o f th is ty p e is a lo g ical acco m p a n im en t o f th eir ch aracter as
arran gem en ts for coo p eration b e tw e e n m a n a g em en t an d e m p lo y ees rather th a n as a ssociation s or organiza
tio n s o f em p lo y ees. E v e n am o n g o p tio n a l m em b ersh ip c o m p a n y u n io n s, h o w ever, 60 p ercen t w ere set u p
so lely b y m a n a g em en t in itia tiv e .
85
gg
T
able
CHARACTERISTICS OF COMPANY UNIONS
29.— Forces responsible for organization of company unions studied, by
time periods
T o ta l 1915-19 1920-22 1923-29 1930-32 1933-35
In itia tin g force
M a n a g e m e n t_________________ ____________ _____________
M a n a g em en t an d e m p lo y ee s_______ _____________________
P rim a rily e m p lo y ee s---------- ----------------------------------------W ar L abor B o a rd ______ ___________________ _____________
N o in fo rm a tio n --------- ----------------- -----------------------------------T o ta l______ ________________________________________
96
18
8
1
3
126
13
0
0
1
0
14
7
1
0
0
1
9
5
0
1
0
0
6
1
0
0
0
0
1
70
17
7
0
2
96
The forms and procedure utilized by management in establishing a
company union ranged from the simple statement of management’s
attitude to the outright dismissal of workers who joined a trade-union
or refused to join the company union.
In some cases the company announced the plan either on a bulletin
board or through the employees’ magazine and then called for the
election of representatives. No expression of opinion by the em
ployees was obtained and no vote on the plan itself was taken. In
one instance the local management received from the New York
office of the company a plan drafted by the company’s attorney.
The local management immediately posted notices that the plan
would be put into effect and that elections for representatives would
be held.
Frequently, management’s proposal to set up a company union or
its approval of a movement to that end was definitely stated in a
letter or folder sent to employees on the subject. Several letters
specifically stated that management wished a genuine expression of
opinion and that there would be no discrimination because of opposi
tion to the plan. The following is illustrative:
To employees of th e ----------Company:
From newspaper reports the officials of the company have learned that one and
perhaps two groups of our employees engaged in a particular line of work have
affiliated themselves with a labor organization, evidently for the purpose of gaining
some supposed advantage under the National Recovery Act.
In consideration of the interests of the great mass of our employees, we feel
that the true facts in connection with the N. R. A. should be presented as they
are written into the act, and not as they are interpreted in a distorted form by
various individuals having a more or less selfish interest in endeavoring to dis
rupt the harmonious relations between employer and employee, which in many
plants has extended over a tong period of years. To that end the following facts
are set forth:
In order to gain the greatest benefits that the N. R. A. can confer, i t i s n o t
N E C E SS A R Y FOR A N Y
EM P LO YE E
W H A T SO E V E R
*.
*
*
OF A N Y
IN D U ST R Y TO JOIN A N Y
O RG AN IZA TIO N
The officials of the company feel that while no organization is necessary to
secure the benefits of the N. R. A. for its employees, yet the present management
has always thought that the workers and the company both might benefit by
having an organization comprising all its employees, to cooperate with the officials
of the company so that the best interests of the employees and the company
HOW COMPANY UNIONS ARE ESTABLISHED
87
might be served and t h e ---------- Company may continue its leadership of the
----------industry of the country, thus bringing increased prosperity to the employ
ees, the company and to the city * * *.
It is evident, we believe, to any thinking employee that numerous small
organizations in our plant would result in nothing but confusion and discord on
account of many and different ideas, while an organization representing all the
employees with a central committee to confer with the management would result
in the orderly and efficient carrying on of the business * * *.
In an endeavor to determine the feelings of our employees regarding this plan,
we are attaching herewith a ballot for each individual employee to select his
representative * * *.
This organization is in no sense a company union as the management will have
no part in guiding the ideas of the representatives. To the contrary, they will
welcome the advice and assistance of all the employees as expressed through
the representatives, so that the combined efforts of all will work for our mutual
benefit.
The management of the business and the direction of the working forces, includ
ing the right to hire, suspend or discharge for proper causes, or transfer, and the
right to relieve employees from duty because of lack of work or for other legitimate
reasons is vested exclusively in the management and these rights shall not be
abridged by anything contained therein.
Vice President.
em plo yee’s
ballot
To be deposited in the ballot
Department No.
b o x a t a n y o f th e g a te s o n
leaving or coming to w ork ,----------.
I hereby select---------------------to be my representative in all matters pertaining
to my employment with t h e ----------- Company, and I agree to abide by all the
decisions in connection with such employment as made by the elected representa
tives and the executive committee, which may be elected by the majority of the
representatives of the employees of th e ----------Company.
A more common procedure was to call a mass meeting of all the
workers or of the workers in a particular department. In some cases,
the original meeting called by the company was either in the nature of
a social or so arranged that the workers were unaware of its exact
purpose.2 In a few cases they even thought that the meeting was
called to organize a trade-union. The mass meeting was addressed
by an official of the company or by the company’s attorney. In two
instances management asked the trade-union organizer to address
the employees and present his side of the case.
Addresses by management were less guarded and more partisan
than printed communications. In most instances the tenor of the
talk was an attack on outside unions or a defense of inside unions or a
combination of these two points of view. The workers were then asked
to vote on the matter either in the open meeting or later in a more or
less secret fashion.
2
T h e title s a d o p ted b y so m e c o m p a n y u n io n s, w h ic h called th em selv es “ c lu b s” , “social c lu b s” , or “go od
w ill c lu b s” , con trib u ted to su ch m isu n d ersta n d in g .
88
CHARACTERISTICS OF COMPANY UNIONS
Sometimes the employer interviewed individuals or groups of
employees to enlist their support for the company union or to dissuade
them from joining a trade-union. One company, which saw an em
ployee-committee system of long standing threatened by a growing
trade-union movement among its employees, resorted to a systematic
series of personal interviews. Management officials pointed out to the
employees that a trade-union meant dues and strikes, and that the
company preferred the inside organization. As a result, the company
union, which had become practically dormant, was revived on a
broader and more formal basis. The management in another instance
called in groups of employees and had them study various plans and
suggest the features which they wished included in the company's plan.
Since, in so many cases, the company union is the alternative offered
by the employer to employees considering organization of an outside
union, one phase of management's activity consisted in waging a
strong fight against the trade-union. In a number of cases manage
ment made open or veiled threats that the plant or certain divisions
might be closed down unless the workers abandoned the trade-union
for the company union. One company, engaged in a distributive
trade, threatened to lease out its delivery work unless the drivers
withdrew from the trade-union. This company prepared and had the
workers sign a resignation from the trade-union, including a statement
that they had joined “ under false pretenses." When signed, these
resignations were all mailed to the trade-union by the company.
In another instance, the morning after the trade-union had held its
initial organizing meeting, the manager interviewed influential
employees, three or four at a time. He told them that the company
would close down if the men affiliated with an outside union. If
they wanted to form an inside union, he would help them.
In some instances where the trade-union had secured a foothold
among the employees, it was sidetracked by delay and postpone
ment while the workers were cajoled or coerced into dropping out of
the trade-union and joining the company union. In one company,
management reported “ Racketeers wanted them to join the tradeunion. We thought the men would be better off without paying
the racketeers." The business agent of the trade-union said, “ I
had the men almost 100 percent. I was referred from one manager
to another. The day I was to see the top man, the company union
was organized."
Dismissals of employees who were active in the trade-union or who
refused to join the company union were not infrequent. The per
sonnel manager of one company reported that the company had
broken up a trade-union movement by discharging its leader. Whole
sale discharges of trade-union sympathizers or of persons who refused
to join the company union were reported in some cases. One com-
HOW COMPANY UNIONS ARE ESTABLISHED
89
pany eliminated one of its departments and at one stroke got rid of
the leading trade-unionists among its employees. The secretary of
one trade-union was laid off in slack season and was not rehired
although he had the highest seniority in his department. The
employment manager told him he couldn’t be rehired now “ but
maybe it will blow oyer.” In another instance, when the company
union voted to affiliate with a trade-union an entire shift was dis
charged, including the president of the company union and others
active in the affiliation movement. Employees in another company,
as they came in for their pay checks one day, were told by the efficiency
engineer to sign a resignation from the A. F. of L. union. Later,
according to affidavits from four workers, the superintendent warned
them to sign up for the company union if they wanted their jobs.
One man who refused was dismissed, but was later rehired at the
direction of the Regional Labor Board.
Pressure in favor of the company union was often exerted by minor
executives and foremen rather than by those in higher positions.
Direct or indirect threats of dismissal, hints that if employees wished
to hold their jobs they’d better sign on the dotted line, a “ white list”
of employees who had joined the company union posted in the work
room, actual dismissal of men sympathetic with trade-unions— all of
these and other methods were used by foremen or those in lesser
authority with or without the approval of officers higher up.
In view of the role played by foremen and minor executives, atten
tion should be called to the cases in which these officials played an
important part in the organization of the 96 company unions studied
in which management took the initiative. In at least 10 cases the
foremen circulated the petition or the constitution or carried the
management’s message about the company union to the workers.
In another case, the foremen circulated the ballots, which were marked
in their presence. In two cases a committee set up by management
to represent the workers was found to consist wholly or mostly of fore
men. In one of these it was claimed that the company-union petition
was placed on a desk next to the time clock and as each man punched
out he was told by the stockroom clerk: “ If you want a 10-percent
raise, you’d better sign.”
Workers ’ initiative in organizing company unions .— Although man
agement initiated and established the great majority of company
unions, in about 20 percent of the cases one employee or a group
of employees were reported to have been actively connected with
the formation of the company union. Genuine employee initiative
was apparent in most of these cases. In some, however, the real
initiative came from management rather than from the men. In one
instance the initiators apparently acted on a hint from management;
1 5 4 8 7 5 °— 38-------7
90
CHARACTERISTICS OF COMPANY UNIONS
in another a member of management was discernible in the back
ground, very much the director of forces. Such management initia
tive was evident in 6 of the 26 cases.
Where employees of their own volition initiated a movement for a
company union, a number of motives operated. Perhaps the least
important of these contributing motives was the ambition of a pros
pective foreman or some aggressive employee who found in the organi
zation of a company union an outlet for his desire for leadership. The
employee or employees who could turn the tide at a critical moment
when a trade-union was making progress could feel that they had
earned the gratitude of their employers. At the same time, they
created an activity in which they could find a means of self-expression
and recognition.3
A much more important influence was the necessity of choosing
whether or not to join a trade-union. With organization in the air,
many workers were presented with the choice of joining a trade-union
or supporting the establishment of some alternative form of organi
zation.4 In nine instances employees who took a part in companyunion organization expressed themselves as either opposed to tradeunions on general principles, or as having had some experience as
trade-union members which had left them disillusioned or resentful.
In this connection it is significant that employee initiative was rare
in the periods before N. R. A. Only 2 of the 30 company unions
dating from before 1933 showed any employee initiative in their
establishment. Of the 96 company unions established in 1933 and
later, 24 were attributed in part, at least, to initiative by an employee
or employees. Thus it was in the period of the N. R. A., when tradeunionism was advancing, when government policy evidenced a new
emphasis on the right of collective bargaining and of self-organization
for collective-bargaining purposes, that initiatory action on the part
of any employee or group of employees became a factor in the estab
lishment of company unions.
Where an employee or a group of employees took the first step in
organizing a' company union, the next step was almost invariably to
ask the management's approval. Not only was this approval forth
coming in almost all instances but in most of the cases under considera
tion the company took an active part in the organizing work. The
forms and procedures utilized by the company in pushing to a success
ful conclusion a company-union movement initiated by the employees
were largely the same as those used by the company where manage3 In tw o of th ese cases m en a c tiv e in organ izin g th e co m p a n y u n io n w ere la ter p ro m o ted to salaried p o sitio n s
or p o sitio n s as forem en a n d straw b o sses. T h is m a y h a v e b een m ere co in cid en ce, b u t it w a s n o t so regarded
b y e m p lo y ee s, as w a s in d ic a te d b y th e c o m m e n ts m a d e to th e field ag en ts.
4 T rad e-u n io n organ ization ca m p a ig n s w ere b ein g carried o n in 18 o f th e 20 cases in w h ic h em p lo y ees
to o k th e in itia tiv e in th e form ation o f a c o m p a n y u n io n . In 6 cases a strik e w as in progress or so r ec e n tly over
th a t th e sen se o f con flict w a s still sh a rp ly e v id e n t.
HOW COMPANY UNIONS ARB ESTABLISHED
91
ment itself took the first step. In one instance, names of employees
who had joined the company union were posted on department bulletin
boards. In another the company called a mass meeting of employees
on company time, at which the company's attorney attacked the
American Federation of Labor and praised the inside union movement
begun by an employees' committee.
Union organization by craft with its complicated jurisdictional
demarcations tended to confuse workers otherwise willing to abandon
company unions for trade-unions and kept some company unions
from assuming trade-union affiliation. Several company unions that
decided upon trade-union affiliation were informed that they would
have to dissect themselves on a craft basis and join the various craft
unions having jurisdiction over those particular occupations. The
employees, confused by the proceedings and wishing to retain their
organization intact, continued the company union.5
Although employee initiative existed in 20 cases, in only 8 of these
did the company union appear to have been initiated and set up
primarily as a result of the initiative of one or a group of workers. The
variety of backgrounds and situations which gave rise to employeeestablished company unions is apparent from the case descriptions 6 of
these eight cases which represent the most marked instances of inde
pendent action by employees in initiating company unions.
In some of these cases, the methods used by the trade-union con
cerned, as well as antiunion sentiment on the part of the employees,
contributed considerably to the setting up of the company union.
Demands with which the workers were not in sympathy and inability
to secure concessions from management caused the demise of the
trade-union in one case. In another case, a violent physical attack on
nonstriking company-union members, set against a background of
intense company opposition to the outside union, caused the employ
ees to leave the outside union. In still another case an impending
strike led employees of one company to break away from the outside
organization and set up an inside organization to make their own
settlement with the company.
In none of these cases, however, was the employer hostile to the
establishment of the company union. In one case the establishment
of the company union by the employees followed an unsuccessful
attempt by the company to set up such an organization, the em
ployees utilizing the same constitution originally proposed by the
5 In on e p la n t th e tra d e-u n io n organizers w h o cam e to organize th e w orkers b egan to p arcel th e m o u t in to
tw o tra d e-u n io n s of sk ille d w ork ers w h o co n sisted of th e k e y em p lo y ees, a n d o n e federal lab or u n io n in w h ic h
w ere to go th e rem a in in g w orkers. T h e w orkers, u n so p h istica ted in th e tec h n iq u e a n d tra d itio n s o f tra d eu n io n stru ctu re, w ere b a ffled . M o st of th em b ecam e frig h ten ed an d d rop p ed o u t. F rictio n also d e v e lo p e d
a m o n g th e th ree u n io n s, ten d in g to w eak en a ll of th em . T h is, togeth er w ith so m e oth er factors, cau sed th e
tra d e-u n io n s to lose o u t to th e co m p a n y u n io n .
6 See ap p en d ix II, p p . 267-269.
92
CHARACTERISTICS OF COMPANY UNIONS
company. Once established, the company union turned to manage
ment for financial assistance and received it. In none of the cases
was anyone dismissed for organizing or joining the company union.
All but one of these organizations were set up after the passage of
the N. I. R. A. Unionization was an actual threat in each of these
cases. In some, a strike was in process or recently over. The em
ployer in almost all instances readily agreed to recognize the inside
union. In almost all cases he gave it more or less substantial conces
sions or assistance in the form of funds for printing and postage, a
signed agreement which had been refused to the trade-union, or a cash
contribution equal to the dues collected by the company union.
C h a p te r V I I I
A s c e rta in in g th e W o r k e r s ’ C h o ic e
After a plan was formulated and proposed, was an effort made to
obtain a free and complete expression from those who were to partici
pate in and be served by the organization? When the machinery for
expressing a choice was available, what alternatives were presented
to the worker?
In two-thirds of the company unions studied the workers were given
some opportunity to express their approval of a proposed company
union. One-third of the company unions were installed without any
expression of choice by the workers, their first expression being a vote
for representatives in an organization that had already been set up.
When an expression of opinion by the workers was obtained, the
secret ballot was used in about half the cases. In the other half, an
open statement by means of signatures to a petition or to a membership
card or roll or a vote by acclamation at a public meeting was used.
T
able
30.— Method of ascertaining the workers’ choice
P eriod o f form ation
M e th o d u sed
Secret v o te ___________ ______________________ _____________
A ccep ta n ce b y a ccla m a tio n _____________________ ______
S ig n atu re to m em b ersh ip roll or p e titio n _____________
N o direct em p lo y ee expression of op in io n on accep ta n cein c o m p le te in fo rm a tio n _________________________ _________
T o ta l_____________ _____ _________ ________ _ .
T o ta l
i 35
14
2 25
34
18
126
1915-19 1920-22 1923-29 1930-32
5
3
0
4
2
14
3
1
0
2
3
9
1
1
0
3
1
6
1933J u ly
1935
1
0
0
0
1
0
i 25
9
25
12
96
2 25
1 T h e figure in clu d es 5 cases in w h ic h th e resu lts of th e secret b a llot w ere n eg a tiv e, b u t th e co m p a n y u n io n
w a s se t u p d esp ite th is resu lt. In 2 of th ese cases th e co m p a n y u n io n w a s su b seq u en tly esta b lish ed o n th e
b a sis o f sig n atu res to a p e titio n . In th e r em a in in g 3 cases th e c o m p a n y proceed ed to th e electio n of rep resen
ta tiv e s.
2 T h is d oes n o t in clu d e th e 2 c o m p a n y u n io n s, referred to in th e p reced in g footn ote, w h ic h w ere esta b lish ed
b y sig n atu res to a p e titio n after h a v in g b een rejected b y th e em p lo y ees in a secret vo te.
Though trade-union organization was an active issue in about twothirds of the cases, it was presented on the ballot as an alternative
method of dealing with the management in only two instances.1 Both
were secret ballots on company unions established during the N. R. A.
The difference in the procedures followed in these two cases was strik1 See footn ote 2 for an oth er case in w h ic h th e trad e-u n io n w a s p resen ted to v o te of th e e m p lo y ees.
93
94
CHARACTERISTICS OF COMPANY UNIONS
ing. One company proceeded with the organization of the company
union despite the fact that two secret ballots showed large majorities
for the trade-union. The other company was unique in giving oppor
tunity for free and comprehensive discussion of the issues involved.
The company, when the trade-union drive for organization was in full
swing all over the country, suggested to the men in a plant meeting
that they organize a company union. Some workers spoke against
it and favored trade-union organization. At a following meeting, at
the request of the men, the company called in a trade-union organizer
to state the union side of the story. Following the talk by the tradeunion organizer, the company officials again addressed the men.
After the meeting, arrangements were made to hold a Governmentsupervised election. The election went in favor of the company
union.
In 33 cases of secret ballot the workers were given the choice of
voting for or against the company union.2 The alternative of a tradeunion was not presented on the ballot. While such a general question
on the desire to organize poses a possible choice between individual
bargaining and any type of collective action, there is no means on
such a ballot to register for any type of organization other than the
company union.
In 13 of these cases unionization was not an important issue at the
time of organization. Most of the company unions in this group
were started in the period after March 1933 as a means of compliance
with N. I. R. A. In all of these 13 cases there was a careful presenta
tion of the proposal to the workers by means of conferences and
letters and a serious effort was made to enlist employee cooperation.
In 20 cases where a secret election was held to vote for or against
the company union, the question of trade-union organization was a
very important factor in the labor situation. These fall into several
more or less clearly defined groups according to the methods by which
the situations were handled.
In the first group, the approach was that of a well-developed per
sonnel department which made careful preparation for the establish
ment of the company union. Although the trade-union alternative,
which some of the employees were clearly anxious to consider, was
ignored, employees were afforded an opportunity to vote under the
protection of a secret ballot and with no intimidation. One company
sent the following letter to its employees:
To employees o f ----------Company:
A large number of employees of the company have expressed a desire for some
plan of organization within this company for employee representation for collec
tive bargaining:
2
In on e case, w ork ers in on e u n it in th e c o m p a n y w ere a sk ed in a d d itio n to v o te for or ag a in st th e tradeu n io n ; th e y v o te d o v e rw h e lm in g ly ag a in st it. T h e resu lt w a s th e n n o tarized . S ee a p p en d ix II , p . 262.
ASCERTAINING THE WORKERS’ CHOICE
95
A tentative plan is submitted herewith which is believed to be practical in our
scattered operations. A sincere effort has been made to make this plan truly
representative. The amendment provision would appear to leave the way open
for any changes which the employees might later consider necessary or desirable
to adapt the plan to any particular problems which may arise.
In order that the employees may have an opportunity to express themselves
on these questions, an election will be held on ---------- at which the following
propositions will be submitted for vote:
(a) The question of whether the employees desire to organize for the purpose
of having representation for collective bargaining;
(b) The adoption of the tentative plan transmitted herewith as a basis for
initial operation, in the event organization is desired by a majority of the em
ployees.
Employees identified with the management of the company * * * will not
be eligible to vote.
The management desires a full and free expression of the wishes of the employees
with respect to the organization of its employees, and will in no way attempt to
influence or control the election of the employee representatives, or their subse
quent action. The attitude of any employee on these matters will not in any way
jeopardize his or her standing or position with the company, nor the right to bar
gain individually as to the terms and conditions of his or her employment.
All voting o n ---------- will be by secret ballot under the supervision and control
of the employees themselves. At some time prior to (that date) the employees of
each department in each division should by secret ballot, or otherwise, select
three tellers, who, with such assistants as they may select, will conduct the elec
tion * * *. If the plan is adopted, these tellers will also conduct the election
to be held shortly thereafter under the plan in order to make it fully effective.
Vice President and General Manager.
In another company, which had the problem of dealing with a
great many scattered units, the personnel department took the lead
in establishing the plan, after a trade-union leader had been dismissed.
The director drew up a series of suggestions for a plan to be presented
to the employees, and he compiled arguments for the acceptance of the
plan to be used by branch and minor executives. The company then
called a series of night mass meetings, one or two to a unit. The per
sonnel director presented the plan and urged its adoption. No action
was taken at these meetings. Later a series of district meetings was
held at which personnel representatives presented the plan to employ
ees more in detail. Management then withdrew and employees voted
by secret ballot upon the plan and for representatives. Evidence
that the employees generally exercised a free choice in the selection of
representatives is shown by the fact that, in strong trade-union dis
tricts, trade-union men were elected as representatives.
Another firm, also with a well-established personnel department,
took four chief steps in establishing its plan: A meeting was called
with the supervisory forces, especially foremen, at which the plan was
carefully gone over; departmental meetings were held with employees,
at which the plan was explained; employee representatives were
96
CHARACTERISTICS OF COMPANY UNIONS
elected to set up tentative bylaws; all employees voted on the plan
by secret ballot.
In some instances the elections were held in an atmosphere of
strong management pressure. The men were told that establishment
of a trade-union would react against their interests. In one case,
about a month after the trade-union committee had had its first
conference with management, the president of the company called a
mass meeting of the workers. At this meeting he attacked the tradeunion as being in the same class as communism and as a source of
strikes. He stated that, with the cooperation of the employees, the
company would try to continue operations even though it was not
making a profit. However, if communism was to govern the plant,
the company could operate more cheaply in another State. He then
held up for inspection a sample ballot which, he stated, he had printed
at his own expense. It read: “ I desire to express my interest in
forming an association composed of employees of the ---------Company.” The president said they could sign their names or simply
mark an X on the signature line; in any case, no one would know how
any individual voted. Ballot boxes were placed in the plant and the
ballots were distributed among the employees, in some instances at
the same time as the pay envelope.
In another case, the morning after the trade-union had held a mass
meeting, the vice president of the company started interviews in his
office with groups of two or three of the most influential workers of
each department. He explained that the company was losing money
and could not increase wages, that if they wanted to form a union he
would help them, and that affiliation of the men with an outside
organization would force him to close the plant. From among these
men he picked a group to draw up a plan for a company union.
This plan was then submitted to a group of 30 to 40 workers who met
in the vice president’s office on company time. The plan was ap
parently accepted by them, but with some changes. An election on
the acceptance or rejection of the company union was then held at
the plant. The bylaws had been printed and the back page consti
tuted a detachable ballot. The vote was 468 for rejection as against
335 for acceptance, but the company proceeded to the election of
representatives.
In all, five company unions were established after secret elections
which resulted in a negative vote.3 In three cases the returns of the
elections were simply ignored and employees were asked to vote for
representatives as if the original elections had been favorable. In
3 In th e n a tu re o f th is stu d y of existin g c o m p a n y u n io n s, it is n o t p o ssib le to d eterm in e h o w g en erally
w ork ers’ n e g a tiv e decision s w ere accep ted , sin ce in su ch cases co m p a n y u n io n s w o u ld n o t n o w b e in existen ce.
In o n e e sta b lish m e n t, it w a s rep orted th a t th e c o m p a n y in 1922 h a d tw ic e su b m itte d a n em p loy ee-rep resen ta
tio n p la n to secret v o te of th e w orkers b u t h a d d rop p ed th e p la n w h e n b o th v o te s sh o w ed a m ajo rity again st
th e proposal.
ASCERTAINING THE WORKERS’ CHOICE
97
the other two, the company union was set up by signatures to mem
bership cards after it had been voted down by the workers.
In about two-thirds of the cases there was no formal secret vote on
the organization of the company union. In about one-third of these
cases the question of trade-union organization was not important at
the time the company union was set in motion. In a majority of the
cases, however, the prospect of unionization was fairly good or a
strike was in progress or just over.
eHART4 ASCERTAINING THE WORKERS’ CHOICE REGARDING
THE SETTING UP OF COMPANY UNIONS
U. S. BUREAU OF LABOR STATISTICS
Sometimes the first notice given to employees was in the form of a
request or announcement to vote for representatives. In one instance
while an outside union was organizing, a company-union plan was
drawn up by the company and announced by the foremen. There
was no general vote on its acceptance or rejection but merely a vote,
announced a few days in advance, for the election of representatives.
Some of the employees objected to holding an election with so little
time to decide on what they wanted to do about the situation, but
their protests were without effect. When the works council was
elected, it accepted the constitution already prepared by the company.
In another case where a trade-union was organizing, management
held conferences with supervisors to explain its proposed plan. They
in turn appointed one or two employees from each department to
serve as a steering committee and to manage the election of repre
sentatives. No general vote was held on the acceptance or rejection
of the plan.
Participation in such elections after the organization was already
set up cannot, however, be assumed to have been a vote in favor of
the organization itself. It indicated in many instances no more than
98
CHARACTERISTICS OF COMPANY UNIONS
a willingness to cooperate, or a desire to make the best of what was
offered. It was not a free choice of what kind of employee repre
sentation, if any, was wanted.
The method of determining the wish of the employees by signa
tures to a petition or to a membership roll or card lent itself, in many
of the cases studied, to the use of various forms of coercion to swell
the number of signatures. Sometimes such documents were circu-*
lated by supervisory officials. When an employee in one case sug
gested to management that some organization should be started
among the employees before an outside union got in, management
suggested that a petition to that effect be circulated among the men.
Some of the foremen passed one around and practically all of the
employees signed it. In another case, while a strike was in progress,
a house-to-house canvass was conducted, and the men were told that
if they wanted to return to their jobs they had better sign up for the
company union. In a third case a “ white list” of those who had
signed was posted in each department. A fourth company union was
established on the basis of signatures to application blanks signed at
group meetings addressed by the manager of the company.
Approval by acclamation at a public meeting meant in almost all
cases that only the arguments for the company union were presented.
Rarely was the meeting held away from the plant without any man
agement representative attending, and with employees who favored
trade-union affiliation given a chance to speak. Most of the voting
was done in the presence of management officials. One company
union was proposed by management and adopted by open vote at a
banquet given the employees by the company. In some instances,
however, management representatives did not attend the meeting
or, after speaking in favor of the formation of a company union,
withdrew from the meeting before the vote was taken.
Chapter IX
Constitutions of Company Unions
In any discussion of company-union constitutions, the distinction
between constitutions and collective agreements must be kept in
mind. A collective agreement is a negotiated contract between an
employer and a group of workers, each of whom has negotiated as a
separate agency. A constitution, on the other hand, embodies the
basic rules and regulations under which an agency operates. If a
company-union constitution binds the employer, it follows that such
a constitution represents, not the framework of an independent em
ployee organization, but rather the basis of an agency to which both
employer and employees are parties.
Of the 126 company unions studied, 108 had written constitutions,
bylaws, rules, or other documents setting forth in greater or less detail
the purpose, structure, and procedure of the organization.1 In 13
cases— 10 percent of the total— there seemed to be no written docu
ment which in any way resembled a constitution.2 Of the 13 com
pany unions without written constitutions, some were entirely inactive
while others held infrequent and irregular meetings. In most in
stances the terms of office were indefinite and provisions for further
elections vague. A mill foreman, who had been most active in setting
up one company-union committee, stated that the committee had no
bylaws or officers, had held no meetings with its constituents, and that
there was no mechanism set up by which the committee reported to
the employees on its activities. While the committee had met several
times with the management, he was vague about the subjects dis
cussed. In another instance, upon announcement of the N. I. R. A.,
1F ield ag en ts w ere a b le to o b ta in 97 of th e 108 w r itte n d o cu m en ts, an d th e a n a ly sis w h ic h fo llow s is con
fin ed , o n m o st p o in ts, to th ese 97. N o t a ll o f th e 97 w r itte n d o cu m en ts o f w h ic h cop ies w ere o b ta in ed w ere
c o m p lete c o n stitu tio n s, d escrib in g p u rp ose, stru ctu re, an d p rocedure. A few m e re ly se t u p a sy ste m of
election s. A few o th ers in d ic a te d in a v e r y general w a y a m ech a n ism for c o n su lta tio n b e tw e e n m a n a g em en t
a n d r ep resen tatives. 42 o f th e d o cu m e n ts w ere n o t called c o n stitu tio n s. A b sen ce o f su ch a title to th e
w r itten d o cu m en t se ttin g forth th e b a sic stru ctu re o f th e organ ization , w h ile in m a n y cases o f n o sig n ifican ce,
on th e w h o le seem s to reflect th e difference b e tw e e n th e a u to m a tic an d m em b ersh ip ty p e s o f c o m p a n y
u n io n . (S ee ch . X for d escrip tio n o f th ese ty p e s.) T h u s, o f 48 w r itten d o cu m en ts cov erin g o p tio n a l-m em b er
sh ip c o m p a n y u n io n s, 39 w ere called “ co n stitu tio n ” , “ b y la w s” , or “ articles o f asso cia tio n ” a n d 9 h a d n o
title or w ere called sim p ly “ ru les.” T h e corresp on d in g figures for th e 49 au to m a tic-p a rticip a tio n c o m p a n y
u n io n s w ere 16 an d 33. I n th is stu d y , for b r e v ity , a ll 97 w r itten d o cu m en ts w ill b e referred to as co n stitu tio n s.
2T h e fiv e rem a in in g cases w ere d istr ib u te d as follow s: O ne c o m p a n y u n io n d e v o te d a paragraph in th e
e m p lo y ee s’ h a n d b oo k to th e e m p lo y ee s’ co m m ittee; in a n oth er case, m a n a g em en t rep orted th a t th ere w ere
tw o ty p e w r itte n cop ies o f ru les in th e p la n t, b u t oth er persons in ter v iew e d rep orted n o “ w r itten c o n stitu
tio n ” ; in on e case a co n stitu tio n w a s in preparation; in tw o cases in form ation w a s lack in g . A ll of th ese fiv e
w ere m ore or less in a ctiv e organ ization s.
99
100
CHARACTERISTICS OF COMPANY UNIONS
the foreladies of the several workrooms in a southern plant were asked
to appoint representatives of the workers for an indefinite term to meet
with the management. These company unions were generally in
smaller plants. They were hastily set up in connection with the
legal requirements of the N. I. R. A. or to forestall trade-union organi
zations or a strike. In three cases the immediate object seemed to be
to obtain a signed agreement to head off trade-union demands.
The absence of any written description of purpose and procedure
was sometimes traceable to management’s attitude. In one case a
committee of employees asked management for permission to form
their own association. Management approved but stated that it
would sign no agreements and that it wanted the organization to
have no written rules and bylaws as these would be a binding influence,
a thing which the management did not want.
Among the 97 written documents obtained there are similarities
that reveal the process of borrowing and adaptation that is universally
found in studying forms of social organization. Thirty-six were very
similar to one or more other constitutions. One group of nine con
stitutions were almost identical in content, arrangement, and wording.
So were another group of seven.
The existence of similarity and of borrowing in company-union
constitutions is chiefly significant as evidence of the fact that company
unions tend to evolve and develop primarily out of the background of
employer experience. Direct contact between employees of different
companies or even between employees of different branches of the
same company was too infrequent to account for such extensive simi
larity. The evidence indicates that in almost all cases 3 employers or
their representatives, personnel managers, or lawyers supplied the
models for company-union constitutions; and that they obtained them
either directly from other firms or through employers’ associations
or agents.4
Purposes as stated in urritten constitutions.— In discussing the pur
poses and objectives as set forth in the preambles, introductory
statements, or purpose clauses of the constitutions, it must be kept
in mind that a purpose formally stated in a written document may
not be achieved in actual operation.5 Ninety-three of the ninetyseven constitutions of which copies were obtained contained some
definite statement of the purposes and objectives of the company
3T h ere w ere th ree in sta n ces in w h ic h em p lo y ees borrow ed c o m p a n y -u n io n c o n stitu tio n s from n earb y
c o m p a n y u n io n s.
4O n e co m p a n y follow ed th e m o d e l p la n o f th e N a tio n a l A sso cia tio n of M an u factu rers; an oth er called u p o n
th e in d u stria l secretary o f th e lo ca l ch am b er o f com m erce to p la n an d in itia te th e c o m p a n y u n io n ; tw o re=
ceiv e d aid from th eir tra d e association s; w h ile tw o oth ers in on e c ity follow ed a m o d e l d raw n u p b y th e
loca l in d u stria l association . S ix com p a n ies relied u p o n la w y er s a n d co n su lta n ts in in d u stria l relation s;
tw o o f th ese in th e sa m e in d u str y u sed th e sa m e la w firm , w h ic h sp ecialized in in sta llin g c o m p a n y u n io n s in
th a t in d u str y an d area. S ee ch . V I I for d iscu ssio n o f m a n a g e m e n t’s role in in itia tin g c o m p a n y u n io n s.
6 T h e d iscu ssion in th e p resen t ch ap ter refers m e re ly to c o n stitu tio n a l p rov ision s. See ch s. X V I I to
X I X for d iscu ssion o f th e a c tu a l carryin g o u t o f th ese exp ressed purposes.
CONSTITUTIONS OF COMPANY UNIONS
101
union, or of the subjects which would fall within its scope.6 In the
remaining four, the scope and purpose may be inferred from a state
ment of subjects specifically reserved to management and from the
list of committees and their duties.
The statements of purpose were sometimes limited to general
expressions of a philosophy and a point of view and were therefore
vague guides to the activities of an organization. More frequently
they listed specific matters to be treated by the company union.
One constitution stated that “ the objects of this club shall be to
promote a feeling of good fellowship, to promote a condition of
welfare for all employees, and to promote a fine relationship between
employees of all company departments, and also of employees to
employers.” In contrast to this general statement was one which
stated specifically that “ the purpose of t h e --------- employees’ asso
ciation shall be to promote cooperation between the company and
its employees, along the following lines: Hours of labor, wages, work
ing conditions, safety and accident prevention, health and education,
welfare of employees, efficiency and economy of operation, and all
other matters affecting employees’ interests directly or indirectly.”
Most of the constitutions specifically or by inference indicated an
intention of dealing with wages and hours. In 21 instances there
was no specific mandate bearing on wages and hours. Jurisdiction
may perhaps have been conveyed by broad provisions such as an
interest in “ all questions of welfare” , “ all controversial matters” ,
“ any matter requiring adjustment” , “ working conditions” , “ the con
ditions under which they labor” , “ suggestions and complaints” , or
“ proposals, recommendations, and grievances.” 6a Vagueness of
phraseology on so important and possibly controversial a subject
makes it particularly difficult for persons concerned with the formation
or conduct of a company union to make sure that there is under
standing and agreement as to intent.
A group of 40 constitutions, while making no specific reference to
collective bargaining, collective dealing, or negotiating, listed wages
and hours among the matters to be dealt with by the company
union. On the other hand, there were 36 that specifically stated it
to be the purpose of the company union to “ deal” or “ negotiate”
with management on wages and hours or to engage in “ collective
bargaining.” 7
e O n e-th ird o f th ese sta tem e n ts w ere in th e form o f p ream b les to th e c o n stitu tio n s, tw o -th ir d s in th e form
of “ p u rp o se” clau ses in th e b o d y o f th e c o n stitu tio n .
6a in se v e n cases p erson s in ter v iew e d agreed th a t w ag es an d h ou rs w ere n o t w ith in th e ju risd ictio n o f th e
co m p a n y u n io n . See ch. X V I I I , p . 172.
7 T h e term “ c o llectiv e b a rg ain in g” ap p ears in 26 c o n stitu tio n s a d o p ted d u rin g th e N . R . A . F o u r o f th ese
c o m p a n y u n io n s a n te d a te d th e N . I. R . A . b u t a m en d ed th eir co n stitu tio n s after th e a ct w a s p a ssed . T h e
u se of th e ter m w a s m ore c o m m o n a m o n g th e op tio n a l-m em b ersh ip ty p e th a n am o n g th e au to m a tic-p a r
ticip a tio n ty p e , w ith 17 o f th e form er an d o n ly 9 of th e la tter in th e group o f 26. In ad d itio n , tw o co n stitu
tio n s u sed th e term “ co lle c tiv e d e a lin g .”
102
CHARACTERISTICS OF COMPANY UNIONS
Even among these there was evidently a wide difference in the
intended scope of the company union’s activities. There has been
a tendency to include under the term “ collective bargaining” any
kind of joint discussion of working conditions, or to designate as
bargaining the mere presentation to management of collective
requests by employee representatives. The intended scope of these
company unions is more clearly shown in those few constitutions
that define the process of collective dealing. For example, one
describes “ collective dealing” as “ to discuss and to recommend, sub
ject to final review by the management.” On the other hand, one
specifies “ to negotiate an agreement” and another gives as its pur
pose “ to make contracts and maintain contractual relations” with
the employer.
All but 10 8 of the 97 constitutions revealed an interest in the
settlement of the grievances of individual employees. This was
specifically recognized as a function of the company union either in
the statement of purpose or in a provision setting forth, in greater or
less detail, the procedure to be followed in adjusting such matters.
Company-union constitutions emphasized the improvement of
mutual relations between workers and management. More than
two-thirds of the 97 constitutions included such statements of pur
pose as: “ To provide a means of friendly and lasting coopera
tion * * *” or “ to promote good feeling, harmony, and full
cooperation * * *.” One set itself the objective of—
prom oting and developing such sym pathetic relations between the em ployees
and their representatives and the m anagem ent and its representatives as will
be to their m u tu al benefit and advantage.
The desire to establish a means of communication between man
agement and employees found expression in the statement of purpose
in 40 constitutions. The clauses varied in the degree of importance
attached to the expression of employee opinion. According to 10
constitutions the company unions were set up “ in order to give the
employees of the company a voice in regard to the conditions under
which they labor * *
Four of these added to the above the
clause “ and to provide more effective communication and means of
contact between the management and the employees on matters per
taining to industrial relations.” Others expressed an intention of
giving employees a chance to “ present their views” or “ to present
suggestions and recommendations” or “ to make suggestions and com
plaints.” In some cases the announced purpose went beyond giving
employees “ a voice” and proposed “ equal representation in the con
sideration of questions of policy relating to working conditions, health,
8 In so m e o f th ese c o n stitu tio n s th e in te n tio n of h a n d lin g in d iv id u a l grieva n ces m ig h t b e im p lie d from
certain b road sta tem e n ts o f p u rp ose, su c h as “ to p rov id e th e clearing h o u se for p rob lem s o f a n y so rt” or
“ affording a m ean s for th e co n sid eration of all q u e stio n s.”
C O N S T IT U T IO N S O F C O M P A N Y U N IO N S
safety, hours of labor, wages, recreation, education, and other matters
of mutual interest.” 9
About one-fifth of the constitutions of company unions set up after
March 1933 expressed or implied a relationship to the N. I. R. A .10
Some quoted section 7 (a) of the act in full. Others stated that “ as
long as the National Industrial Recovery Act shall remain in effect,
this plan shall be subject to such act and any codes or regulations”
promulgated in connection with it. In other constitutions there were
such references as “ in accordance with section 7 (a)” , “ in order to best
exercise the right and provisions granted to employees of industry
under the N. I. R. A .” , “ to promote the objects of N. I. R. A .”
One constitution, the draft of which was sent to the branch plant
from the national headquarters of the company, stated: “ The purpose
is to treat with the company management in accordance with the
terms of H. R. 5755, as it pertains to wages, working hours, and
working conditions.”
Fifteen company-union constitutions specifically included dis
charge, lay-off, and transfer among the matters to be taken up by
the company union. In the remaining cases, no specific reference to
these matters was included in the constitution.11 The most explicit
statement referring to discharge appeared in the constitution of a
company union wdiich had developed out of a trade-union. The pre
amble charged the company union to “ protect the place and position
earned by years of faithful service with its consequent skill and
efficiency * * *.”
On the other hand, 11 company-union constitutions specifically
reserved to management the authority over hiring and discharge.12
The most common form of reservation, found identically in nine
constitutions, was as follows:
T h e m anagem ent o f th e works and the direction of the working forces, including
the right to hire, suspend, or discharge for proper cause, or transfer, and the right
to relieve em ployees from d u ty because o f lack o f work, or for other legitim ate
reasons, is vested exclusively in the m an agem en t; and, except as expressly p r o
vided herein, these rights shall not be abridged b y anything contained herein.
9T h ere w ere four su ch cases. T h e y w ere jo in t cou n cils of m an a g em en t an d em p lo y ees. T h e practical
op eration o f su ch p rov ision s is d iscu ssed in ch. X I I I , p . 135.
10E x p licit reference to th e N . I. R . A . a n d th e cod es w a s fou n d in th e sta tem e n t of p u rp ose in 13 c o n sti
tu tio n s. T w o oth ers in d ir e ctly rela ted th eir p u rp ose to th e N . I. R . A . in th e p ro v ision regarding ter m in a
tio n of th e c o m p a n y u n io n . C o n stitu tio n s w ere ob ta in ed for 74 o f th e 96 c o m p a n y u n io n s se t u p d u rin g
N . R. A.
11In tw o of th ese com p a n ies, m a n a g em en t officials in ter v iew e d sp ecifically sta ted th a t h irin g an d firing
w ere e x c lu siv ely w ith in th e con trol of th e c o m p a n y .
12 E ig h t o f th ese r estrictiv e clau ses w ere in c o n stitu tio n s of th e a u to m a tic-p a rticip a tio n ty p e c o m p a n y
u n io n s, an d o n ly th ree in th e o p tio n a l-m em b ersh ip ty p e . I n th ree cases, w h ere th e co n stitu tio n w a s sile n t
on th e m a tter, th e sa m e restr ic tiv e clau se ap p eared in a su p p lem e n ta r y ag reem en t or in p rin ted sta tem e n ts
b y th e co m p a n y accep tin g th e c o m p a n y u n io n . In on e of th ese, th e clau se h a d a t first b e e n in th e con
stitu tio n b u t h a d b een ta k e n o u t in th e course of an ex ten siv e rev isio n an d in corp ora ted in a sta tem e n t
from th e c o m p a n y to th e co m p a n y u n io n .
104
CHARACTERISTICS OP COMPANY UNIONS
Other objectives frequently encountered in these constitutions were
the improvement of working conditions,13 the promotion of the safety
and health of the employees,14 and the pursuit of social, recreational
and athletic activities.15 A fourth of the constitutions mentioned
among their purposes the improvement of operating efficiency and
the achievement of economy.16 Ten constitutions either explicitly
listed assistance against illness, death, or need, or made specific pro
vision for the payment of certain benefits.17 Four included in their
preambles more or less emphatic statements against trade-unions.18
Parties sponsoring the constitution.— The groups which are parties
to a document are indicated either by explicit statement or by impli
cation in certain clauses explaining obligations and duties. Thus some
of the company-union constitutions contain in their preamble, in an
introductory letter, or in an early article such statements as “ the
following * * * is hereby adopted by employees and manage
ment.” Other company-union constitutions have specific provisions
binding management with respect to payment of certain expenses,
participation on joint committees and conferences, or arrangements for
appeal and arbitration.
Ninety-two constitutions contained provisions for management’s
relation to the company union. In 27 instances management used
the constitution as a vehicle to announce that it was giving the
representation arrangement to its employees.19 These constitutions
13
F o rty -six in c lu d e d th is in th e sta tem e n t of purpose, w h ile 17 oth ers p ro v id ed for a c o m m itte e on th is
m atter.
T w e n ty -n in e c o n stitu tio n s liste d th is am o n g th e sta ted p u rp oses, w h ile 17 oth ers se t u p co m m itte e s to
d eal sp ecifica lly w ith th is m a tter. T h is p u rp ose w a s fo u n d so m ew h a t m ore freq u en tly am o n g th e a u to
m a tic-p a rticip a tio n th a n a m o n g th e op tio n a l-m em b ersh ip ty p e c o m p a n y u n io n s.
w T w e n ty -fiv e liste d th is in th e sta tem e n t of p u rp ose w h ile 18 oth ers p ro v id ed for a c o m m ittee. T h ree
em p h asized th is asp ect in th eir title s b y term in g th em selv es a clu b or a social clu b . O ne of th ese, in a so u th
ern m ill, also in clu d ed “ m oral a c tiv itie s” in th e list of p u rp oses, w h ile an oth er so u th ern m ill c o m p a n y u n io n
a d d ed “ im p r o v em e n t o f p la n t a n d villa g e, ed u ca tio n , religiou s exercises.”
16F iftee n h a d a sta tem e n t to th a t effect in th e p u rp ose clau se, w h ile e ig h t oth ers p ro v id ed c o m m itte e s on
th is m atter. S u ch p rov ision s w ere so m ew h a t m ore co m m o n in c o m p a n y u n io n s set u p before N . R . A .
th a n in th o se set u p after M a rch 1933 an d in th e au to m a tic-p a rticip a tio n ty p e of c o m p a n y u n io n s th a n in
th e o p tion al-m em b ersh ip ty p e .
17 AH w ere in th e o p tio n a l-m em b ersh ip ty p e co m p a n y u n io n s. T w o w ere b a sed on b en efit association s
w h ic h d a ted b a ck 10 or m ore yea rs an d to w h ic h th e com p a n ies con trib u ted ; a th ird w a s an o u tg ro w th of a
tra d e-u n io n , from w h ic h its m em b ers h a d sp lit a w a y in 1921. T h e rem a in in g se v e n w ere set u p d u rin g th e
N . R . A . period.
T h ree oth er c o n stitu tio n s liste d c o m m ittees o n p en sio n s an d relief or so m e sim ila r su b ject. In tw o of
th ese, as w e ll as in an oth er in w h ic h b en efit p la n s w ere referred to as on e of th e pu rp oses, th e co m p a n y u n io n
w a s a p p a ren tly to fu n ctio n so lely in rela tio n to th e b en efit features a lread y esta b lish ed b y th e c o m p a n y .
T h e d iscu ssion here covers o n ly th o se co n ta in in g b en efit features in th eir c o n stitu tio n s. M a n y m ore
c o m p a n y u n io n s a c tu a lly p ro v id ed so m e form o f b en efit feature. See ch. X I X , p . 181.
is T h e m o st extrem e sta tem e n t read: “ W h ereas th e y d esire b y u n ite d actio n to fu rth er th eir co m m o n
in terests an d p rotect th em selv es ag ain st lab or organ ization s d o m in a ted b y u n scru p u lo u s an d rack eteerin g
lead ers an d h a v in g for th eir p u rp ose th e ex p lo ita tio n o f lab or, an d th e crea tio n o f in d u stria l strife.” S e v e n
tee n , in c lu d in g th ree of th ese four, eith er d ir e ctly or b y im p lic a tio n ex clu d ed tra d e-u n io n m em b ers or barred
th e m from office. O ne also ad d ed an a tta c k o n rad icals. S ee p . 112. S ee also, ch. X . p . 113, fo o tn o te 20.
i® M a n a g em en t sp on sorsh ip w a s exp ressed in 5 o f th e 27 cases b y a n a c c o m p a n y in g or in tro d u c to ry letter
from th e p resid en t o f th e c o m p a n y or, in o n e in sta n ce, from th e ch airm an o f th e b oard o f directors. In th e
rem a in in g cases it w a s e v id e n c e d b y a sta te m e n t in th e p ream b le.
CONSTITUTIONS OF COMPANY UNIONS
^05
stressed mutuality of interest and need for better understanding, as
exemplified in the following:
The company believes absolutely that the interests of employer and employee
are mutual * * *. The company also believes that its employees are entitled
to a fair and just wage * * *. The company further believes that practically
all misunderstanding between men of mutual interest is due to lack of knowledge
of each other * * *. With this basis of common understanding and common
beliefs * * * the firm of ---------- established the following plan of joint
representation.
Five other constitutions stated that20 the company union was
introduced jointly by management and the employees.21 A typical
statement of such sponsorship was:
The employees and the management of the — ------ - Company join in the forma
tion of this plan in order to establish industrial relations upon a permanent basis of
mutual understanding and confidence.
Fourteen constitutions contained the contradiction of an explicit
introductory statement that they were employee-sponsored coupled
with later clauses binding the company and necessarily implying
management participation in such sponsorship. In the remaining 46
cases there w^as no explicit statement of sponsorship, although the
constitutions contained specific provisions obligating management.
Only 5 of the 97 constitutions studied gave indication of being com
pletely independent of management participation. They contained
no clauses of any kind referring to the role of management in the
company union and no references to mutual sponsorship by employees
and management or to the assumption of obligation by management.
One of these started as follows:
We, the employees of th e ----------Company, having formed this union upon our
own initiative, at our own expense, and under the advice of our own counsel, do
establish the following constitution * * *:
There was a definite tendency for constitutions written during the
N. R. A. not explicitly to state management sponsorship although
clauses in the constitution usually indicated mutual responsibility.
Half of the constitutions dating from before 1933 were explicitly
management-sponsored, but only about 20 percent of the constitutions
dated after March 1933 contained statements to that effect. On the
other hand, all but one of the constitutions explicitly stating exclusive
20S ole or jo in t m a n a gem en t-sp o n sored p la n s w ere a lm o st e n tir e ly con fin ed to th e a u to m a tic-p a rticip a tio n
ty p e of c o m p a n y u n io n . O f th e 32 c o n stitu tio n s co n ta in in g a reference to m an a g em en t sp o n sorsh ip , all b u t
4 w ere of th is ty p e . O n th e oth er h a n d , o f th e 17 co n stitu tio n s th a t c o n ta in an ex p licit sta tem e n t of em p lo y ee
sp on sorsh ip , 12 w ere o f th e op tio n a l-m em b ersh ip ty p e a n d o n ly 5 o f th e a u to m a tic ty p e .
21 A n o th er co n stitu tio n esta b lish ed in 1933 “ b y t h e ----------C o m p a n y a n d its e m p lo y ee s’' w a s, accord in g
to a 1934 rev isio n , “ esta b lish ed b y th e e m p lo y ee s o f t h e ---------- C o m p a n y .” In tw o o th er c o m p a n y u n io n s
d a tin g from 1933, reco m m en d a to ry le tte rs from m a n a g em en t w ere d rop p ed in th e first rev isio n , a n d n o
sta tem e n t o f sp o n sorsh ip rem a in ed . S in ce th e classification u se d a b o v e w a s b a sed o n th e situ a tio n ex istin g
at th e tim e of th e v is it o f th e field a g en t, th ese cases w ere n o t classed w ith th e join tly -sp o n so red group b u t
w ith th e em p loyee-sp on sored a n d no -sp o n so rsh ip grou p s, resp e ctiv e ly .
1 54875°— 38-
-8
106
CHARACTERISTICS OF COMPANY UNIONS
employee sponsorship were drafted in the period after March 1933.22
Amendments .— Seventeen of the constitutions contained no pro
visions for amendment.23 Of the 80 constitutions having such pro
visions, 51 permitted changes to be voted by employees or employee
representatives only. In a few of these, however, approval by manage
ment was required for all or certain amendments.24
In 29 cases amendment was possible only by vote of joint groups
of management and employee representatives. In some of these,
amendments had to be approved by management after being passed
upon at joint meetings. One constitution26 specified that the board
of directors could take the initiative and “ alter, amend, or repeal the
plan.”
Provision fo r termination.— Twenty-seven of the ninety-seven con
stitutions available contained provision for termination of the com
pany union. Although in most of these cases the organization could
be terminated by the employees, in 13 instances management also
had the power to terminate the company union by its own action.26
In three instances joint action by both management and employees
was required.
In most cases from 3 to 6 months’ notice was required before
termination. However, a few tied the life of the company union to
that of the N. I. R. A. One provided that “ this plan shall be and
remain in full force and effect during the term of the National Indus
trial Recovery A ct.” 27 The others added the provision “ and there
after may be terminated by the management or by a majority of the
duly elected employees’ representatives upon 3 months’ notice.”
One expressed the trial nature of the plan in its termination provision
thus:28 “ This plan having been adopted in the belief that it will prove
of permanent value and usefulness, and with the intention that it be
given a full, fair, and honest trial, the plan is entered into subject to
22T h is te n d e n c y a w a y from form al sta tem e n ts of m an a g em en t p a rticip a tio n in th e e sta b lish m e n t o f th e
c o m p a n y u n io n a n d to w a rd sp ecific sta tem e n t o f e m p lo y ee sp o n sorsh ip w a s reflected also in a few cases in
w h ic h sta tem e n ts o f sp o n so rsh ip w ere ch a n g ed w ith rev isio n o f th e co n stitu tio n after M a rch 1933.
23 In th ree o th er in sta n ces, n o a m e n d m e n t co u ld b e p a ssed a b o lish in g th e eq u a l v o tin g p o w er of e m p lo y e e
a n d m an a g em en t r ep resen ta tiv es in th e jo in t com m ittees.
2* In th ree in sta n ces, tw o d a tin g from 1919, a m e n d m e n ts v o te d b y em p lo y ee s req u ired fin al a p p ro v a l b y
m a n a g em en t. In an oth er case, th e ap p ro v a l o f m a n a gem en t w a s req u ired if th e a m e n d m e n t con cern ed th e
org a n iza tio n ’s rela tio n to m a n a g em en t, n o t if it d ealt w ith m atters o f p u r e ly e m p lo y ee con cern . In still
an o th er case, m a n a g e m e n t’s ap p ro va l h a d to b e ob ta in ed if th e a m e n d m e n t w a s m a d e w h ile a p re v io u sly
en tered agreem en t w ith m an a g em en t w a s in force.
M a n a g e m e n t’s p a rticip a tio n in th e am e n d in g process w as e lim in a te d in tw o cases b y c o n stitu tio n a l ch an g e
a fter M a rch 1933; w h ile in a th ird , a m e n d m e n ts in stea d of req u irin g m an a gem en t a p p ro va l w ere m e re ly m a d e
su b ject to m a n a gem en t v e to w ith in 15 d a ys.
25 T h is w a s in a co m p a n y u n io n organ ized d u rin g th e N . R . A .
26 C o n stitu tio n a l rev isio n after M a rch 1933 in tw o cases e lim in a te d p ro v isio n s w h ic h g a v e m a n a g em en t a
v o ic e in th e term in a tio n o f th e c o m p a n y u n io n . In an oth er case th e p rov ision for term in a tio n w as e lim in a te d .
27 A ch an g e in th e d irection of th e elim in a tio n of su c h clau ses took p la ce am o n g so m e c o m p a n y u n io n s in
1934. S ee U . S. S en ate, C o m m itte e o n E d u c a tio n an d L abor, H ea rin g s on S. 2926, T o C reate a N a tio n a l
L a b or B o ard , p t. 3, p . 724, W a sh in g to n , 1934.
28 T h is p ro v isio n w a s rep laced la ter b y on e p er m ittin g term in a tio n o n ly on v o te of tw o -th ird s of th e
e m p lo y ees. A sim ila r p ro v isio n w a s e n tir e ly e lim in a te d in an oth er case.
CONSTITUTIONS OF COMPANY UNIONS
107
the express condition and limitation that it may be terminated after
June 30, 1935: (a) Upon 3 months’ notice by the board of directors
of the company, if said board has reason to believe that the mutual
benefits anticipated by its adoption have not been realized; (b) upon
the expiration of 3 months after a majority of the electors shall have
voted in favor of its termination at a special election called for that
purpose, by a majority vote of the representatives, and held under the
supervision of the workmen’s council.”
Chapter X
Membership
Limitation of membership to the employees of one plant or company
is the basic feature which distinguishes participation or membership
in company unions.1 Such limitation reflects a basic difference between
company unions and trade-unions. However, participation in com
pany unions does not necessarily follow from employment. There
is one broad class of company unions in which the right of participation
in the organization flows automatically from employment. In another,
the right of participation arises from membership which, while open
only to employees of the company, is optional.
In the first group, membership in the company union and employ
ment cannot be distinguished. To be sure, certain qualifications in
addition to employment may be set up—length of service with the
company, age, or citizenship— but all employees who meet these
thereby automatically acquire the right of participation. They partic
ipate as voters in the selection of representatives to deal with the
employer. They do not join any association. There is no organiza
tion of employees with control over its members. Management
spokesmen have pointed out that membership in the usual sense of the
term does not exist in this type of company union.2 Constitutions of
automatic-participation company unions invariably use the term “ em
ployee” instead of “ member.”
This basis of participation characterized a little more than half—
68— of the 126 company unions studied.3 They were predominantly
1 E m p lo y e e s tem p o ra rily la id off reta in th e rig h t o f p a rticip a tio n b u t o n ly so lon g as th e y are con sid ered
as rem a in in g in th e sta tu s o f e m p lo y ees. See p . 113.
2 See U . S. S en ate, C o m m itte e o n E d u c a tio n an d L abor, H ea rin g s on S. 2926, T o C reate a N a tio n a l L abor
B o ard , p t. 3, p. 722, W a sh in g to n , 1934:
Q u estion . H o w m a n y of th e w ork ers b elo n g * * * h o w m a n y of th e m are m em b ers th a t sig n th e roll,
so to speak?
A n sw er. T h ere are n o m em b ersh ip dues; th ere is n o form o f org an ization to w h ic h th e y su b scrib e as
m em b ers. T h e y in d ic a te th eir p a rtic ip a tio n in th e p la n b y p a rticip a tio n in th e n o m in a tin g b a llo t an d
ejectio n b a llo ts a n n u a lly , b y co n ta cts w ith th eir rep resen ta tiv es a t to w n m e etin g s o f d ep a rtm en ts h eld after
th e regular r ep resen ta tiv e m e etin g s h a v e b een h e ld .
3A sm a ller p rop ortion o f a u to m a tic-p a rticip a tio n cases w a s fou n d a m o n g th e 592 c o m p a n y u n io n s w h ich
rep lied to a m a il q u estion n a ire in q u ir y . See ch . V , p . 60, a n d also p . 31, foo tn o te 1, w h ere on e reason for
th e d ifferen ce is con sid ered .
108
MEMBERSHIP
109
in the larger plants and in company unions established before the
N. R. A.4
In the optional-membership group the employee is required to
express an intention to join or to cooperate with the organization.
This was true in 58 of the company unions studied. The procedure
varied. Sometimes6 signing a card or a written declaration of inten
tion to vote was sufficient. In other cases the prospective member
was required to make application. In some instances the application
was passed upon by a membership committee or by a full meeting
of the members. In a few cases, a formal pledge of loyalty and con
formity with the principles of the organization was required.6 Some
times membership cards or badges were issued7 and, in a few cases,
there were initiation ceremonies.
Two company unions with nominally optional membership had
clauses in their agreements similar to the closed-shop clause in a
trade-union agreement. One of these agreements, in a small distribu
tive concern, stated:
Any man working continuously for 30 days shall be considered an employee
and shall be compelled, either by the employer or this organization, to join this
organization.
The other followed trade-union provisions more closely:
Three months after the engagement of an employee his application for member
ship in the company union shall be approved or rejected by the union.
The employment of any operative whom the shop committee of the union has
found undesirable shall terminate upon receipt by the company of the shopcommittee findings. Appeal may be had to the arbitration council of the union.
In another case the company union, which split away from a tradeunion, had so complete a control of the jobs concerned that member
ship was in effect compulsory. No specific closed-shop clause appeared
in the agreement, however.
4 A t th e tim e of th e s tu d y o n ly four of th e p re-N . R . A . c o m p a n y u n io n s w ere b a sed on o p tio n a l m e m b er sh ip
an d on e of th ese h a d sw itch e d to th e op tio n a l b a sis after M a rch 1933. T h e c o m p a n y u n io n s w ith o p tio n a l
m em b ersh ip th u s d a te a lm o st e n tir e ly from M a rch 1933 a n d rep resen t a d efin ite sh ift in th e b a sis o f p a rtici
p a tio n . T h is sh ift is fu rth er in d ic a te d b y th e fact th a t fiv e c o m p a n y u n io n s, form ed sin ce M a rch 1933, also
su b seq u en tly ch a n g ed from a n a u to m a tic to an o p tio n a l m em b ersh ip b a sis. In several in sta n ces th e ch an g e
from a u to m a tic p a rticip a tio n to o p tio n a l m em b ersh ip w a s m a d e in several step s. W h e n th e o u tsid e tradeu n io n w a s organ izin g a n d th rea ten in g to d isp la ce a c o m p a n y u n io n b a sed o n a u to m a tic p a rticip a tio n ,
e m p lo y ee s favo rin g th e c o m p a n y u n io n e sta b lish e d “ e m p lo y ee s’ asso cia tio n s.” T h eir p u rp ose w a s to pro
v id e th e b a ck in g o f a m em b ersh ip o rg an ization for th e co m p a n y u n io n b u t n o t to d isp la ce it. S u b seq u e n tly ,
h o w ev er, th e rep resen tation p la n m erged in to th e association an d th e c o m p a n y u n io n b ecam e an o p tio n a l
m em b ersh ip organ ization .
8T h ere w ere se v e n su ch in sta n ces.
6T h ere w ere fou r su ch cases. T y p ic a l o f th ese p led ges w a s th e follow ing:
“ I , ----------, so le m n ly sw ear th a t I b e lie v e in th e p rin cip les o f ----------A sso cia tio n o f ----------- as se t o u t in th e
p ream b le o f its co n stitu tio n ; th a t I sh a ll, to th e b e st o f m y sk ill an d a b ility , str iv e b y p recep t an d exa m p le
to m a k e sa id p rin cip les a n d p u rp oses th e ru les o f m y life an d co n d u ct as a m em b er of th e A sso cia tio n .
“ * * * I sh a ll k e e p secret all tra n sa ctio n s of th e A sso cia tio n * * *.
“ I am n o t n o w an d sh a ll n o t b e d u rin g m y con n ectio n w ith th is A sso cia tio n a m em b er of or affiliated w ith
a n y o th er lab or o rg an ization .”
7 F ifte e n of th ese c o m p a n y u n io n s referred to th e issu an ce o f su ch cards or b a d ges,
no
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
In three cases, the company union had requested a closed shop,
but the company refused. A written agreement in one of these cases
contained a specific open-shop clause:
Employer and association mutually agree that neither membership nor non
membership in the association shall in any way deprive the individual employee
of his or her full constitutional rights as to individual or collective bargaining.
Employer and association mutually agree that employment in the (company)
during the period of this agreement shall be open to all individuals equally,
without prejudice as to employees’ membership or nonmembership in this asso
ciation.
Some other constitutions stressed the voluntary aspect of member
ship. The following provision was inserted in the constitution of one
company union when it changed from an automatic to an optional
membership basis:
Membership in the association shall be purely voluntary and shall continue until
such member leaves the employ of the company either when he quits, is discharged,
or laid off, exempting, however, all temporary seasonal lay-offs not exceeding 90
days or when he voluntarily resigns from the association by turning in his mem
bership card along with a written 30«-days’ notice of his intention.
Three constitutions of company unions set up during the N. R. A.
contained the following statement:
Membership in th e ----------Employees’ Association is purely voluntary and not
discriminatory in any form, as provided in the National Industrial Recovery Act.
The line of distinction between automatic participation and op
tional membership is sometimes extremely vague. In one case most
of the persons interviewed stated that all employees were automatically
considered participants, although the constitution specifically pro
vided that membership was to be voluntary. In 23 of the 58 optionalmembership company unions, membership had no more special
significance to the employee than in company unions operating on an
automatic-participation basis. Membership was acquired by signing
a card, without initiation fees or dues. Management’s desire that all
employees join, which in many cases meant possible disadvantage to
those who did not, was evident.
Despite the frequent absence of clear distinction in the character
of membership between the two types of company unions, each had
definite structural characteristics. Most company unions based upon
automatic participation provided in their constitutions for joint
committees of representatives of management and employees.8 They
were designated as “ plans” , “ committees” , “ congresses” , or “ coun
cils” 9—which terms refer to agencies of representation rather than
organizations of employees. They rarely provided for dues and never
for initiation fees. They seldom provided for regular meetings of
employees.
8 See ch . X I I I for d escrip tio n of d ifferen t co m m ittee procedures.
8A ll b u t 8 of th e 69 au tom a tic-p a rticip a tio n co m p a n y u n io n s h ad su ch title s, 3 oth ers h a v in g n o d efin ite
title.
111
MEMBERSHIP
The group of company unions based on optional membership
tended toward the employee-committee procedure. Their consti
tutions almost never provided for joint committees of management
and employee representatives, which by definition make management
a party to the company union. They were usually called “ associa
tions” , “ unions” , “ societies” , “ fraternities” , or some other name
emphasizing the organization of workers rather than the meetings of
their representatives.10 They usually termed their basic written
document a “ constitution” or “ bylaws” , as opposed to “ rules” ,
which was used for the other type.11 In this group were included
practically all company unions providing for dues and for frequent
and regular meetings of employees. Of the 58 company unions with
optional membership, 42 possessed at least 2 of the 3 structural char
acteristics described above— dues, employee-committee procedure, and
frequent 12 and regular meetings of employees. On the other hand,
only 4 of the 68 company unions with automatic participation had as
many as 2 of these characteristics, while 39 had none at all.
The number of company unions with dues, frequent and regular
employee meetings, and employee committees was distributed between
the two different types as indicated in table 31.
T
able
31.— Number of company unions with specified attributes, by basis of
participation, spring of 1985
A ttr ib u te s
C o m p a n y u n io n s w ith d u es, e m p lo y ee m eetin g s, an d em p loy ee-co m
m itte e p ro ced u re__ _____________________ ______ ____ __ _ . ____________
C o m p a n y u n io n s w ith a n y 2 of th ese fea tu res. __________ ____________
C o m p a n y u n io n s w ith a n y 1 o f th ese fe a tu r e s..
_______ _ ________
C o m p a n y u n io n s w ith n o n e of th ese f e a t u r e s .__________________________
N um ber
N um ber
w ith a u to w ith op
m a tic par tio n a l m e m
b ership
ticip a tio n
2
2
25
39
16
26
13
3
T o ta l
18
28
38
42
Restrictions on membership.— The most common restriction to
participation, aside from employment status with the company, was
the exclusion of persons in executive positions. In four-fifths of
the organizations 13 persons holding such positions were excluded
10A ll b u t 8 of th e 58 o p tion al-m em b ersh ip co m p a n y u n io n s h a d su ch title s.
A fter M a rch 1933, in lin e w ith th e te n d e n c y tow a rd o p tion al-m em b ersh ip org an ization s, th e title “ asso
c ia tio n ” w a s m u c h m ore c o m m o n ly u sed . A lth o u g h rare before th a t d a te, th is title or so m e rela ted n a m e
w as u sed b y h a lf of th e organ ization s set u p after M a rch 1933. T w o c o m p a n y u n io n s w h ic h w ere first form ed
after 1933 as “ p la n s” w ith a u to m a tic v o tin g rig h ts ch an g ed to “ e m p lo y ee s’ asso cia tio n s” w h e n v o lu n ta r y
m em b ersh ip w a s esta b lish ed . T h ree organ ization s se t u p d u rin g N . R . A . u se d th e ter m “ u n io n ” , o n e w a s
su b title d “ a n in d ep en d en t v ertica l u n io n ” , an d an oth er ad o p ted a title sim ila r to th a t o f th e tra d e-u n io n
in th e field . N o n e of th e p re-N . R . A . organ ization s u se d th e term “ u n io n ” , a lth o u g h o n e c h a n g ed u n d er
N . R . A . from th e d esig n a tio n “ co o p era tiv e a ssociation ” to “ sh o p u n io n .” A few c o m p a n y u n io n s e sta b
lish ed d u rin g N . R . A ., a lth o u g h th e y p resu m ed to b e em p lo y ee-rep resen ta tio n agen cies, h a d su c h title s as
“ c lu b ” or “ m u tu a l aid asso cia tio n .”
11See ch. I X , footn ote 1, p . 99.
12M o n th ly or oftener.
is N o in form ation on th is p o in t w as o b ta in ed for 20 co m p a n y u n io n s.
112
CHARACTERISTICS OF COMPANY UNIONS
altogether.14 The excluded group was defined as: “ Persons with the
right to hire and discharge” , “ persons identified with management” ,
“ persons in executive positions” . Sometimes the excluded positions
were specifically enumerated. Promotion to such positions normally
terminated the right to participate. A few company unions admitted
all employees without restrictions. In some cases higher executives
were not allowed to take part but foremen and subforemen possessed
full participation rights. Some admitted foremen and supervisors to
membership and benefits but denied them the right to vote or hold
office.15 Office employees and other persons in salaried positions were
excluded by the constitution of 50 company unions and included
in 37.16
Ten company unions limited their membership to employees in
particular groups or crafts.17 In all but one of these cases, the
particular limitation was related to the jurisdictional lines followed
by trade-union organization.18 A very common restriction on partici
pation was length of service with the company.19
Fourteen company unions either directly or by implication stipu
lated that their members must not belong to or have dealings with
H T w o c o m p a n y u n io n s a d o p ted th is restrictio n b y co n stitu tio n a l rev isio n after M a rch 1933. In th ree cases
th is restrictio n w a s disregarded in p ractice. T w o p la n s w h ic h follow ed th e congress ty p e of proced u re
(see foo tn o te 2 to ta b le 32) h a d sep ara te co u n cils for forem en an d e x ecu tiv es resp e ctiv e ly .
18 In o n e in sta n c e h on orary m em b ersh ip w a s p ro v id ed for forem en an d officials of th e co m p a n y .
16T h e r e w a s n o in form ation on th is p o in t for 39 co m p a n y u n io n s.
17T h is is in a d d itio n to th e lim ita tio n to a p articu lar su b sid ia r y p la n t, or oth er geographical u n it o f th e
co m p a n y .
18F or in sta n c e , in tw o p rin tin g e sta b lish m e n ts th e c o m p a n y u n io n w a s con fin ed to a p a rticu lar craft w h ile
so m e or all o f th e rem a in in g crafts w ere organ ized in tra d e-u n io n s. D iv isio n o n occu p a tio n a l lin e s also
resu lte d in d iv isio n o n sex lin e s in on e case. In tw o o th er com p a n ies, each of w h ic h h a d a p r o d u ctio n p la n t
a n d a d istr ib u tin g d iv isio n , tw o sep ara te c o m p a n y u n io n s w ere se t u p in lin e w ith th is d iv isio n . In on e of
th ese, a co m p a n y u n io n co n fin ed to th e n o n p ro d u ctio n w ork ers h a d b een se t u p in 1924. W ith th e p a ssag e of
t h e N . I. K . A ., th e c o m p a n y esta b lish e d an o th er a ssociation for th e p r o d u ctio n e m p lo y ee s in order to k eep
th e m o u t o f th e old er c o m p a n y u n io n , w h ic h h a d b ecom e r e la tiv e ly in d e p e n d e n t. T h e v ic e p resid en t of th e
c o m p a n y n eg o tia ted an agreem en t w ith th e p resid en t o f th e old co m p a n y u n io n to d e lim it th e ju risd iction s
of th e tw o organ ization s.
19 S u ch r estrictio n s w ere fou n d in 55 c o m p a n y u n io n s. T w e n ty -tw o req u ired 1 m o n th ’s co n tin u o u s service
w ith th e c o m p a n y before an em p lo y ee w a s e n title d to ta k e p a rt in election s, 16 req u ired 2 m o n th s, 9 se t th e
service p eriod a t 3 m o n th s, 1 a t 4 m o n th s, 4 a t 6 m o n th s, an d 2 req u ired 1 y ea r’s co n tin u o u s service. O n e
oth er c o m p a n y u n io n lim ite d v o tin g r ig h ts to th o se en rolled o n th e c o m p a n y p a y roll b y A p ril 1 of th e
electio n yea r. In 4 o f th ese 55 cases a d istin c tio n w a s m a d e b e tw e e n 2 ty p e s o f m em b ersh ip — a lim ite d
m em b ersh ip w h ic h cou ld b e acq u ired im m e d ia te ly b u t d id n o t carry th e righ t to v o te , a n d a fu ll m em b er
sh ip acq u ired after a sp ecified p eriod o f service a n d carryin g w ith it th e rig h t to v o te or h o ld office. C o m
p a ra tiv ely few c o m p a n y u n io n s h a d age restrictio n s. E ig h t c o n stitu tio n s se t IS y ea rs as a m in im u m age
for v o ters, w h ile tw o oth ers sp ecified 21 y ea rs. O n e w h ic h e m p h a sized sic k b en efits, req u ired a sta te m e n t as
to h e a lth a n d a m ed ica l ex a m in a tio n . A n o th er d e m a n d ed th a t m em b ers u n d e r sta n d th e E n g lish lan gu age.
T h ree req u ired c itiz e n sh ip an d fiv e a t le a st first papers. In a so u th ern m ill m em b ersh ip w a s restricted to
“ w h ite c itiz e n s” , an d in an oth er so u th ern esta b lish m e n t w h ite an d colored em p lo y ees in th e several d ep art
m e n ts elected sep ara te rep resen tatives.
S u ch c o n stitu tio n a l ch an g es after M a rch 1933 as d ealt w ith th ese m a tters w ere all in th e d irection of relax
in g th e restrictio n s on p a rticip a tio n . T h u s four c o m p a n y u n io n s d rop p ed th eir service req u irem en ts, w h ile
tw o o f th ese also stru ck o u t c itiz e n sh ip a n d ag e restrictio n s. A n o th er red u ced th e ter m o f e m p lo y m e n t
r eq u ired for v o tin g . F or reasons for th e a b a n d o n m en t of th e serv ice q u a lifica tio n for v o tin g in o n e case, see
a p p en d ix I I I , p . 274.
I t should b e noted th at at th is p oin t only restrictions for general m em bership or for votin g are being dis
cussed. T here are sim ilar, b u t m ore stringent, qualifications for representatives, w h ich are discussed below
(ch. X II ).
MEMBERSHIP
113
other labor organizations.20 Such restrictive clauses occurred only
among organizations of the optional-membership type. All but one 21
were in company unions set up after March 1933. In all of these
cases a trade-union was active among the employees at the time the
company union was set up. In most there had been strikes or bitterly
contested elections to determine the bargaining agency. A number
of these restrictions were applied to “ any other labor organizations” .
Some, however, limited the restriction only to unions competing with
the company union. Thus one applied it only to “ another labor
organization or union within the factory.”
In a majority of the company unions, 73 out of 126, the right to
participate in company union activities continued during a lay-off.
Some of these placed limitations upon this right.22 Those which
charged dues suspended payment of dues during the lay-off. Four
provided that discharged members who questioned the justice of
their discharge retained membership until their cases had been de
cided by the last body of appeal.
The widely varying estimates of number of persons belonging
to a particular company union further indicated the occasional
vagueness of membership. Even where there were nominal dues the
company union and company officials disagreed widely on the extent
of membership in their plants. Estimates varied from “ under onehalf” to “ practically all” ; “ 70 percent” to “ 100 percent” ; “ 44 percent”
to “ 67 percent.”
Reasonably consistent estimates were obtained for 45 of the 58
company unions established on an optional-membership basis.23
Twenty-seven of the forty-five were reported to have enrolled threefourths or more of the eligible workers. Three of these, in effect,
had a closed shop. Eleven had a membership of from one-half to
three-fourths, seven from one-fourth to one-half of the workers.
Benefit features, where they existed, tended to swell membership.
20 N o in form ation o n th is p o in t w a s av a ila b le for 25 co m p a n y u n io n s. O f th e 14 w h ic h h a d su ch restric
tio n s, 2 req u ired th a t m em b ers m u st agree th a t th e co m p a n y u n io n w o u ld b e th e sole collectiv e-b arg ain in g
ag en cy . T h ree oth er c o m p a n y u n io n s p erm itted tra d e-u n io n m em b ers to jo in th e c o m p a n y u n io n , b u t
barred trad e-u n io n m em b ers or officers from h o ld in g office in th e c o m p a n y u n io n .
In on e case th e c o m p a n y , as a c o n d itio n of sig n in g a n ag reem en t w ith th e c o m p a n y u n io n , in siste d th a t
th e organ ization r em o v e from its c o n stitu tio n a clau se exclu d in g tra d e-u n io n m em b ers.
T h is w a s a n organ ization w h o se m em b ers brok e a w a y from a tra d e-u n io n d u rin g a strik e.
22E le v e n lim ite d th e le n g th o f tim e, v a ry in g from 2 to 6 m o n th s, or “ as lo n g as retain ed o n th e p a y ro ll” ,
or “ as lo n g as h e retain s h is tim e clock n u m b e r .” O ne p erm itted rete n tio n of m em b ersh ip o n ly w ith th e
ap p ro va l o f th e sh o p c o m m ittee. T w o restricted th e m em b er’s righ t to v o te for th e p eriod o f lay-off.
23S in ce m o st c o m p a n y u n io n s d id n o t bar tra d e-u n io n ists from jo in in g a n d m a n y tra d e-u n io n s d id n o t
forb id th eir m em b ers to jo in th e c o m p a n y u n io n , th ere w a s an o v erla p p in g in m em b ersh ip w h ic h , in certain
cases, w a s con sid era b le. T h u s tra d e-u n io n officia ls in on e case sta te d th a t m a n y w ork ers b eca m e m em b ers
of th e c o m p a n y u n io n th ro u g h fear o f d iscrim in ation . A s e v id e n c e o f th is th e y sta te d th a t m a n y tradeu n io n m em b ers in go od sta n d in g also jo in ed th e c o m p a n y u n io n o n g e ttin g jo b s a t th e p la n t. T rad e-u n ion
m e m b er s in a n o th er c o m p a n y jo in e d th e c o m p a n y u n io n to p ro tect th eir se n io r ity . In on e case, in w h ic h
m a n y tra d e-u n io n m em b ers also b elon g ed to th e c o m p a n y u n io n , th e a c tiv itie s of th e in sid e u n io n , w h ic h
w ere la rg ely social, w ere con sid ered as n o t b ein g in con flict w ith th o se o f th e tra d e-u n io n . In an oth er case
in w h ic h a large d u p lica te m em b ersh ip existed , a b itter figh t ag ain st th e tra d e-u n io n h a d b een carried on
b y th e m an a gem en t,
Chapter X I
Finances and Dues
The significance of funds for a functioning organization must be
judged in relation to its aims and ends. Among the company unions
studied, the chief use for funds was to compensate employee repre
sentatives and company-union officials for time lost from work on
account of company-union business, and for such miscellaneous ex
penses as secretarial services and printing. Some company unions
had benefit features or furnished occasional assistance to needy
members. Few rented meeting places since most met on company
property. Still fewer used funds for the employment of experts or
advisers. None attempted to build up any strike funds.
About two-thirds of the company unions relied entirely on the
employer for financing.1 The constitutions of some of the organiza
tions entirely financed by the company contained an explicit state
ment that “ all expenses of the plan are to be borne by the company.”
Some indicated the company's responsibility in a negative way by
providing that there were to be no fees, dues, or assessments of any
kind. Some merely provided that the company would pay repre
sentatives for time lost from work on account of company-union
business. Others made no mention of finances in the constitution
although the company paid the bills.
Lack of provision for raising funds meant that the company union
had to depend entirely upon the employer for such activities as
involved expenditures. In a number of plants the budgetary control
was general rather than specific, the company regularly contributing
a fixed sum to the treasury. In others, approval for specific expendi
tures was obtained from the management in advance. All notices of
meetings, mimeographed and printed minutes of meetings, meeting
places, ballots, ballot boxes, stationery, and stamps, were provided by
the company. If the company union wished to hire an outside
expert for any purpose, the consent of the management was required.
Such controls, however, did not always result in restricted expendi
tures. One full-time paid company-union official stated: “ I can go
in any mill (of the company) at any time, travel where I like.”
1 E ig h ty o u t o f on e h u n d red an d tw e n ty -fiv e c o m p a n y u n io n s. T h is in clu d es on e in w h ic h social fu n c
tio n s w ere p a id for b y em p lo y ee a ssessm en ts, b u t n o extra in co m e w a s received from th ese fu n ctio n s.
T h e co n stitu tio n p ro v id ed th a t “ T h e cost of each fu n ctio n sh a ll b e p rorated am o n g th e m em b ers atten d in g
th a t p a rticu lar fu n ctio n .” In fo rm a tio n o n th is p o in t w a s la ck in g for on e case.
114
FINANCES AND DUES
115
The assumption by management of company-union expenses did
not always mean that the employer undertook as a matter of principle
to bear the whole expense. In a few cases, management clearly
indicated its intention or desire to have the company union finance
itself. One constitution, after stating that the company would
provide suitable meeting places and pay representatives for time lost
from work, continued: “ Except that, if the employee representatives
so desire, they shall be at liberty to arrange for compensation to be
paid by pro-rata assessment among the employees.” Another
stated that “ The employees may arrange to pay all or any part of
this compensation.” Although some of these company unions had
been in existence for a number of years, one of them as far back as
1919, only one had undertaken to share any expenses.2
In some cases management contributed more or less regularly to
the company-union treasury rather than meet expenses directly. One
company union opened a bank account, out of which payments were
made by the company-union treasurer. He accounted to the company
for all expenditures. At intervals the company gave him a check for
deposit to this account, which w^as entered on the books of the com
pany as “ donations to the employees’ association.” 3
The cost to the employer of financing a company union varied with
the activity and elaborateness of the organization and the payments
made to representatives and officers of the company union. One
company had a budget of $800 a month for its company union, not
counting the salaries of the personnel men. Another contributed $500
a month to the company union. In a third case the company occa
sionally paid $500 to the association treasurer. Another company
reported $227 paid in a 6-week period, exclusive of $40 a week for
the paid secretary, and compensation and traveling expenses for
employee representatives. In some cases the expense was only for
postage and mimeographing.
Dues and assessments.— Thirty percent of the company unions
required regular payment of dues from members or participants. Six
others raised some funds by assessments, raffles, and parties, while
one inactive organization apparently had no dues and no expenses.4
Among the company unions covered, the practice of charging dues
was in the main a development of the N. R. A. period 5 and was con2T h is c o m p a n y u n io n p a id a p a rt of th e exp en ses of a d elegation to th e N . R . A . cod e h earings.
3 In th is procedure th e p u rp ose, as sta ted b y th e m an a gem en t, w as to p rev en t th e p a y m e n t of represen*
ta tiv e s for th eir tim e from ap p earin g on th e c o m p a n y ’s b ook s. It regarded d o n ation s to th e association
as “ n o b o d y ’s b u sin ess.”
4T h e origin of th is p la n w a s th u s d escrib ed to th e field agen t b y th e em p loy er: U p o n an n o u n cem en t of
N . I. R . A ., th e em p lo y er called h is m e n togeth er an d to ld th e m th e y cou ld go ah ead a n d form a n organiza
tio n for co lle c tiv e b argain in g, a n d th a t th e y h a d b etter get a la w y er to sh o w th em h o w , b u t th a t h e w o u ld
n o t g iv e th em a p e n n y for it; w h ereu p o n th e m en d ecid ed th e y cou ld do it ju st as w e ll w ith o u t p a y in g a
law y er.
fi F or so m e q u a lifica tio n as to th e gen eral v a lid ity of th is con clu sio n , see p t. II, p . 63.
116
CHARACTERISTICS OF COMPANY UNIONS
fined almost entirely to optional-membership company unions.6 The
proportion which charged dues was somewhat lower among the com
panies with less than 200 employees than among those with more.
Dues were, as a rule, set at a fixed amount per week, month, or year.
In a few cases, however, they varied with the earnings of the employee7
or were limited to an amount “ sufficient to defray the necessary oper
ating expenses.” 8 Ten 9 also charged an initiation fee. Some pro
vided for special assessments in addition to fixed dues.10
Eleven company unions collected dues through a check-off from
the pay roll.11 In two other cases a request for a check-off had been
refused by management. The remaining dues-charging company
unions collected their dues through delegates or representatives in
the shops, or through the treasurer or his assistant at meetings.
In most cases, the dues charged were nominal. The most common
rates were 25 cents12 and 10 cents13 a month. A few charged 50 cents
a year. More than two-thirds of the total charged $3 a year or less.14
« T h e 38 c o m p a n y u n io n s w h ic h ch arged d u es in c lu d e d o n ly 4 th a t h a d b een organized before 1933. T h ir ty fiv e of th e 38 h a d o p tio n a l m em b ersh ip .
R elia n ce o n fin an cial su p p o rt from m a n a g em en t w a s eith er form ally or a c tu a lly red u ced or elim in a te d
in a n u m b er o f cases b y ch an g es m a d e after M a rch 1933. T h ree c o n stitu tio n s w ere a m e n d e d to e lim in a te
p ro v ision s ca llin g for c o m p a n y fin an cin g. In on e case, h o w ev er, th e sep ara tio n w a s m ore a p p a ren t th a n
real, for th e c o m p a n y c o n tin u e d to p a y th e co m p a n y -u n io n exp en ses. (S ee foo tn o te 21.) O n e c o m p a n y
sto p p e d p a y in g e m p lo y ee rep resen ta tiv es for tim e sp e n t o n co m p a n y -u n io n b u sin ess o u tsid e office h o u rs.
F o u r c o m p a n y u n io n s a d o p ted d u e s p ro v isio n s, th e c o n stitu tio n h a v in g p r e v io u sly b e e n sile n t in tw o cases
on th e sou rce o f fu n d s. A n o th e r in creased its d u es a n d b eca m e self-su p p ortin g .
T h e p rob lem o f d u es a n d co m p a n y -u n io n fin an cin g b eca m e m ore p ro m in en t w ith th e p assage, in J u ly
1935, o f th e N a tio n a l L ab or R e la tio n s A c t, w h ic h p ro h ib ited co m p a n ies from fin an cin g or oth erw ise d o m
in a tin g organ ization s o f th eir e m p lo y ee s. O n e c o m p a n y se n t a le tte r to a ll e m p lo y ees a n n o u n cin g th e
p assag e o f th e a ct a n d in terp retin g its sig n ifican ce for th e c o m p a n y u n io n :
“ T h a t p ro v isio n of th e a c t w h ic h c h ie fly interferes w ith th e o p eration o f th e e m p lo y ee s’ a ssociation is th e
p ro h ib itio n u p o n a n y em p lo y er from ren d erin g fin an cial or oth er su p p o rt to a n org an ization o f its e m p lo y ee s.
I t ap p ears u n a v o id a b le th a t u n d er th is p ro v isio n m e m b e r s h i p d u e s v n l l b e n e c e s s a r y to fin an ce certain a c tiv i
ties o f th e association . P re su m a b ly it w ill also b e n ecessary to m a k e so m e ch an ges in th e co n stitu tio n an d
in th e articles o f ag reem en t b e tw e e n th e a ssociation a n d th e c o m p a n y . In sh o rt, m a n y q u estio n s arise as
to w h a t o f p a st p ractices of th e c o m p a n y in its r ela tio n sh ip to th e a ssociation w ill or w ill n o t b e lega l in th e
fu tu r e .”
T h e c o m p a n y u n io n su b se q u e n tly a d o p ted a p ro v isio n for d u es of 40 cen ts a yea r, to cov er p rin tin g , p o st
ag e, an d o th er in c id e n ta l exp en ses. T h e c o m p a n y co n tin u e d to p a y tra v el exp en ses o f rep resen ta tiv es an d
to c o m p en sa te th e m for tim e lo st from w o rk o n co m p a n y -u n io n b u sin ess.
7T h e va ria tio n w a s from 10 to 25 cen ts a m o n th in tw o cases a n d from 25 cen ts to $1 a m o n th in th e th ird .
8T h e fee o f th e la w y er w h o d rew u p th e co m p a n y -u n io n c o n stitu tio n an d th e cost o f p r in tin g th e co n sti
tu tio n w ere, h o w ev er, p a id b y th e c o m p a n y in th is case.
9T w o each ch arged 25 cen ts, 50 cen ts, $1, a n d $2; o n e ch arged $1 for m en a n d 50 cen ts for w o m en ; a n d
on e, $5. In tw o oth er cases th e c o n stitu tio n s referred to an in itia tio n fee, b u t th ere is n o e v id e n c e th a t it
w as a c tu a lly charged.
10In o n e case sp ecial assessm en ts, if v o te d b y th e m em b ers, w ere to b e le v ie d “ p ro p o rtio n a lly to earn in gs” ;
as p o ssib le occasion for su ch sp ecial a ssessm en ts, th e p la n m e n tio n e d “ to e m p lo y c o u n sel.” O n e co m p a n y
u n io n , o n th e o th er h a n d , sp ecifica lly forbade extra assessm en ts, a d v ertisin g th e c o m p a n y u n io n as “ no
ra ck ets or a sse ssm e n ts.”
11S in ce th e ch eck -off is a m ea n s o f co n trollin g a n d m a in ta in in g th e m em b ersh ip o f a n o rg an ization , it is
sig n ifica n t th a t in n in e o f th e cases in w h ic h it w as u se d , a tra d e-u n io n w a s seek in g or h a d so u g h t th e rig h t
to rep resen t th e w orkers.
12S ev en cases.
13S ix cases.
1* S ix ch arged b e tw e e n $5 an d $10 a yea r, th ree from $10 to $13, an d on e from $3 to $12, accord in g to earn
in g s. In o n ly 3 of th ese 10 cases w ere all th e fu n d s co llected av a ila b le for fu n ctio n in g as a rep resen ta tiv e
a g en cy in d ealin g w ith th e em p lo y er. In th e oth er se v e n cases, a m ore or less con sid erab le p a rt o f th e fu n d s
co llected w a s u sed to p ro v id e so m e form o f sick n ess, d ea th , or oth er b en efit p a y m e n ts for th e m em b ers.
117
F IN A N C E S A N D D U E S
The receipts from assessments were always small. One organization
of 1,300 members that obtained its funds by selling buttons had an
annual income of $95. The constitution of another stated:
Practically the only expense of this organization is for printing, and as we are
to remain self-supporting this small amount shall be raised annually either through
an entertainment or an assessment of some kind.
The fact that 38 company unions charged dues and 6 others levied
assessments did not mean that they were self-supporting. In some
cases a fairly considerable part of the cash budget was contributed
by management,16 although the most common financial assistance
was the payment of employee representatives. Twenty-five com
panies reimbursed such representatives for time spent on companyunion business. Another provided an office for the full-time official
of the company union who was paid from membership dues.
EMPLOYEE CONTRIBUTIONS TO COMPANY UNION FINANCES
P ercent
SO
Percent
r-
--
80
.%
64 3
6 0
6 0
-
4 0
4 0
.%
22 4
20
20
.%
4 3
5®
U.S. BUREAU OF LABOR STATISTICS
Nine company unions received no financial assistance from manage
ment other than the use of plant property for meetings or elections
or compensation to employee representatives only for time spent in
actual conference with company officials.16
The organizations least dependent upon the management for finan
cial aid varied in their attitude toward financial independence as a
15N in e m a d e regular or occasion al d irect cash co n trib u tio n s, su ch as m a k in g good all d eficits, m a tc h in g
e m p lo y ee s’ d u e s, p a y in g ex p en ses of th e fu ll-tim e official o f th e c o m p a n y u n io n , p a y in g tra v e lin g exp en ses
o f e m p lo y ee r ep resen ta tiv es, p a y in g th e la w y er w h o d rew u p th e b y la w s as w e ll as for th e p r in tin g o f th e
b y la w s. T e n o th ers p a id for p r in tin g or sta tio n e r y an d oth er in c id e n ta l exp en ses in a d d itio n to co m p en
sa tio n to e m p lo y ee rep resen ta tiv es.
16In on e o f th ese n in e cases th ere w a s n o u se of p la n t p rop erty b y th e c o m p a n y u n io n an d n o co m p en sa tio n
for e m p lo y ee rep resen ta tiv es. F o u r h eld electio n s in th e p la n t a p p a r en tly on c o m p a n y tim e.
118
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
principle of labor organization. In three, which were among the
group set up primarily upon the initiative of the workers,17 there was
apparently a definite feeling that independence was important as a
matter of principle. They did not possess large treasuries, however,
thereby limiting their potential activities. In one or two cases,
although the organization had been set up by management, the
feeling had developed that financial independence of management
was desirable on principle.18 One was described by its members as
having been established and maintained by the employees in order to
keep the trade-union out rather than to function as a collectivebargaining agency. It had a clause limiting its treasury to $3,000.
The secretary of the organization indicated the following prospective
uses of its current $2,100 treasury fund:
With almost 1,000 members we have a good cash balance sufficient to help
members in distress on short notice, aid Boy Scouts, Fish and Game Association,
and care for crippled children.19
Dues are a factor in the competition between trade and company
unions. Much of the literature presenting advantages of company
unions emphasized that they charged no dues. It emphasized that
the workers were not being forced to contribute anything out of their
own income “ to support racketeers and high-priced union officials
who smoked big cigars and stopped at expensive hotels.” The
workers were told that equal benefits could be obtained through the
company union without expense.20 The following quotation from a
company union publication illustrates this attitude:
We want to handle our affairs free from the control and greed of labor leaders.
We feel that we can reach the best results, both from the point of view of our pay
envelope and of good feeling and working conditions if we who are closest to the
situation sit down and calmly talk over the differences and reach an agreement like
gentlemen. No amount of hot air by high-salaried union officers, nor strikes, nor
violence ever get the worker farther ahead on the rough road to industrial security
* * * . We don’t believe that we are the tool of the company just because
we see eye to eye with them about the union problem. We’re going to get every
thing we want within reason, and it won’t cost you a dollar a month or a cracked
head.
That dues were at times a drawback to company-union membership
was evidenced by the figures on membership and the attitude of
employees. The members in several organizations said that they
would not belong if dues were charged. One personnel director stated
17 See ch. V II, p p . 90-92.
is O ne of th ese w h ic h h a d b een in existen ce sin ce 1922 w as rep orted as “ n o w self-su p p ortin g” , w ith a
treasu ry of $8,000.
ifl A few oth ers exp en d ed th eir fu n d s to p rov id e sm a ll b en efits an d social features. O thers h a d a sm a ll
in com e w h ic h w e n t n o t for b en efits b u t for op eratin g expense.
20M a n a g em en t com p la in ed in on e case th a t so m e em p lo y ees th o u g h t th a t “ p a y in g d u es to th e co m p a n y
u n io n e n title d th em to a raise.”
F IN A N C E S A N D D U E S
119
that charging dues would cut down membership.21 The chairman
of one company union charging 10 cents a month said, “ We are
handicapped by lack of money. But we can’t raise our dues now,
because we would lose too many members. We should have started
out with higher dues.”
In an oth er in sta n ce in th e course of a th orou g h rev isio n in 1934, it w a s in ten d ed to p rov id e for d u es a n d to
m a k e th e p la n self-financed. T h e co m p a n y , h o w ev er, feared th a t th is w o u ld p rov e u n p o p u lar. C onse
q u e n tly , a lth ou gh a p rov ision th a t “ th e co m p a n y sh a ll defray su ch exp en ses as are n ecessarily in cid en t to th e
d ischarge of d u ties h erein se t forth ” w a s d rop p ed from th e co n stitu tio n , no p ro v ision w a s m a d e for fin an cin g
th e co m p a n y u n io n b y d u es or a n y oth er d efin ite m ean s. O n w r itten order of th e treasurer of th e com p a n y
u n io n th e co m p a n y co n trib u ted $400 m o n th ly .
Chapter X II
Officers and Representatives
The activities of any organization are carried on primarily by its
officials. An organization’s strength is increased by the absence of
restrictions that limit it in securing officers and advisers who can best
serve its needs. Its value to the members is enhanced where their
will is readily manifested through the freest and most effective choice
of officials and where there is close and frequent contact between
officials and members.
Company unions are usually administered by two kinds of officials—
officers and representatives. The officers, such as president, secre
tary, and treasurer, perform the duties normally attached to such
positions. Representatives, as the name implies, are to maintain
contacts with the employees in their districts, hear their grievances
and demands, and, either directly or indirectly, see that they receive
consideration. Employee representatives are usually elected by dis
tricts.1 These districts generally follow the lines of regular plant
departments, or occupations, or the geographical divisions of the
employer’s business.2
Employee representatives were required to be employees of the
company,3 and were generally not allowed to continue serving after
1 O n ly a b ou t o n e-te n th of all th e co m p a n y u n io n s s tu d ie d h a d a n y oth er p a ttern . T h ree h a d n o rep resen
ta tiv e s an d fu n ctio n ed e n tir e ly th ro u g h officers elected d ir e ctly b y all of th e em p lo y ees. N in e oth ers e lected
rep resen ta tiv es from th e p la n t a t large rath er th a n from p articu lar d istricts. A ll of th ese excep tio n s w ere
in p la n ts w ith less th a n 700 w ork ers. S o m e o f th e larger e sta b lish m e n ts h a d large d istricts, each w ith several
rep resen tatives, rath er th a n sm a ll d istricts w ith a sin g le rep resen ta tiv e.
2T h e m e th o d s are n o t n ecessa rily m u tu a lly e x clu siv e, sin ce c o m p a n y d ep a rtm en ts m a y follow geographic
d iv isio n or o ccu p ation al d iv isio n s. In so m e cases, m ore th a n o n e b a sis w a s u sed .
3In tw o cases th e req u irem en t w a s n o t d e fin ite ly sta te d in th e c o n stitu tio n b u t w a s im p lied . T w o other
c o m p a n y u n io n s rep orted th a t th e y h a d on ce d e v ia te d from th e p ractice. In on e o f th ese, an a tto r n ey con
n ected w ith a c o m p a n y official o n ce m e t a n d v o te d w ith th e e m p lo y ee rep resen ta tiv es, b u t h e w a s n o t
elected b y a n y d istrict. M a n a g e m e n t sta te d th a t h e offered h is services gratis in order to p u b licize h is
p ractice. R ep resen ta tiv es o f an oth er c o m p a n y u n io n sta te d th a t a m a n w h o w a s n o t an e m p lo y ee h a d
serv ed as a rep resen tative in 1934, b u t th e w ork ers w ere d issatisfied a n d w ith in 4 m o n th s rep laced h im w ith
an e m p lo y ee. In on e co n stitu tio n th e electio n of o u tsid ers w a s fo rm ally p e r m itted b u t ch aracterized as
u n w ise:
“ W h ile it is recognized th a t w orkers m a y select as th eir rep resen tatives a n y person, firm , or org an ization ,
w h atsoev er, th e y consid er it w iser th a t th e rep resen ta tiv es elected sh a ll b e w orkers * * *. T h e y w ill
th u s b e fam iliar w ith th e p rob lem s of th eir resp ectiv e d ep a rtm en ts an d k n o w all th e w orkers w h o se p rob lem s
th e y are to a d ju st.”
T h e sa m e clau se ap peared in th e c o n stitu tio n of an oth er c o m p a n y u n io n , b u t w a s later ta k en o u t.
120
O F F IC E R S A N D R E P R E S E N T A T I V E S
121
leaving the employ of the company.4 The great majority of the
company unions required that an employee representative must be
employed in the division which he represents and that he must not
hold a supervisory position.5 From this principle there usually flowed
the corollary rule that a representative’s tenure of office ends when he
is transferred to another department or promoted to a supervisory
post.
Eligibility requirements for representatives were usually more
stringent than those for membership or voting. More than half
required a definite period of service, usually a year.6 An age mini
mum 7 and American citizenship were frequently specified.8 In a
few cases a knowledge of the English language was required.9
More than three-fourths of the company unions reported that
voting districts were set up to correspond to the regular departments
of the company.10 Sometimes, particularly where the number of
employees per representative was large or the process of manufacture
extensively subdivided, he was expected to represent the interest of
employees engaged in a variety of occupations or types of work.
Sometimes a department with an unusually large number of workers
was subdivided into “ natural” sections. On the other hand, several
departments with only a few workers each were often grouped to form
a single voting district. Voting districts in 15 organizations were on
a craft or occupational basis. In distributive companies with a large
number of scattered small units each unit was a voting district or else
several units were grouped for representation purposes.
Representatives served for a 1-year term in the great majority of
company unions. A few had a 2-year term, and a few others a term
4
In o n ly 11 c o m p a n y u n io n s w a s th ere n o su ch rule. F ou r co n stitu tio n s m a d e n o reference to term in a tio n
o f e m p lo y m en t an d th e p erson s in ter v iew e d rep orted th a t rep resen ta tiv es w ere p e r m itted to c o n tin u e in
office after le a v in g th e e m p lo y of th e c o m p a n y . T w o c o n stitu tio n s p ro v id ed th a t, if a rep resen ta tiv e ter
m in a te d h is e m p lo y m en t, h e m ig h t b e retain ed b y a m a jo rity v o te o f th e e m p lo y ee s h e rep resen ted . In
four ad d itio n a l c o m p a n y u n io n s th e co n stitu tio n stip u la te d th a t th e rep resen ta tiv e m ig h t reta in h is office
if o n ly tem p o ra rily la id off, o n e lim itin g th e tim e to 60 d a y s. In an oth er case th ere w a s n o form al p rov ision
to th is effect, b u t rep resen ta tiv es in ter v iew e d rep orted th a t a rep resen ta tiv e if o n ly tem p o ra rily la id off
m ig h t s ta y in office if tw o -th ird s of h is co n stitu en ts v o te d to retain h im . T w o c o m p a n y u n io n s rev ised
th eir c o n stitu tio n s after M a rch 1933 so th a t em p lo y ee r ep resen tatives w ere n o t a u to m a tic a lly d isp la ced as
rep resen ta tiv es if th e y lo st th eir jobs.
c T h is reg u lation to o k th e form of eith er a restrictiv e clau se lim itin g p a rticip a tio n in th e c o m p a n y u n io n
to h o u rly em p lo y ees or o f specific clau ses listin g q u a lification s of rep resen tatives.
6T h ere w ere 67 in all, o f w h ic h 45 sp ecified 1 y ea r’s service an d 11 req u ired 6 m o n th s’ service. O n e other
stip u la te d 6 m o n th s in “ on e se c tio n ” , an oth er 6 m o n th s’ m em b ersh ip in th e co m p a n y u n io n . O ne sp ecified
o n ly 2 m o n th s’ service, an oth er o n ly 1 m o n th . O ne of th ese (se ttin g a 1-year service con d ition ) req uired
a n a d d itio n a l 4 m o n th s’ service in th e p a rticu lar d ep artm en t.
7 T h ere w ere 53 in all, o f w h ic h 50 set 21 as th e m in im u m age. A n o th er stip u la te d 21 years for m en , b u t
18 yea rs for w o m en . O ne se t 24 years, an oth er 25 years.
8T h ere w ere 49, of w h ic h 7 sp ecified th a t first p ap ers sufficed.
9 T w o c o m p a n y u n io n s sp ecified th a t ca n d id a tes n eed o n ly be ab le to “ sp eak E n g lish ” ; th ree, to “ read an d
w r ite E n g lish ” ; a n d tw o , to read, w rite, a n d sp eak E n g lish . S u ch lan gu ag e req u irem en ts w o u ld n a tu r a lly
n o t b e m en tio n e d in a large n u m b er of co m p a n ies w h ic h em p lo y ed E n g lish sp ea k in g w orkers.
10T h is w a s th e case in 77 o u t o f 98 c o m p a n y u n io n s rep ortin g o n th is p o in t. T w e lv e c o m p a n y u n io n s
eith er h a d n o rep resen tatives or elected th em at large. (See fo o tn o te 1 a b o v e .) In form ation w a s la ck in g
in 16 cases.
1 5 4 8 7 5 ° — 3 8 --------9
122
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
of only 6 months. Eight company unions had no provision for elec
tions and one held elections “ when asked for.” In order to avoid
having an entirely new set of representatives come into office at once,
many provided that half the voting divisions should hold elections at
one time and half at another. All but one company union permitted
reelection of representatives, although several limited the number of
terms representatives might serve.11
The nomination of candidates for election as representatives was
most commonly by secret ballot.12 Usually the two persons receiving
the largest number of votes were declared nominated, but sometimes
three, and even four, were so designated. Fifteen company unions
provided for nominations from the floor either at a general meeting or
electoral divisional meeting. Other methods were the use of nom
inating petitions, nominating committees, and filing of notice of can
didacy.13 In 20 cases no nominations were made prior to the formal
elections.14
The secret ballot for electing representatives was employed in
almost all company unions. Certification of nominations and super
vision of elections was entirely in the hands of employees in more than
five-sixths of the organizations.15 Management representation on the
election committees was reported for 12 company unions,16 while in
4 management alone supervised elections.
In comparatively few instances was there indication of company
influence over the elections as between different candidates.17 The
evidence indicates that management had selected the chairman in two
cases and that the representatives were “ hand-picked” in three cases.18
The members of the grievance committee of one company union appar
ently had been appointed by management. In another case where
the company union was just being organized and formal elections
were scheduled for the near future, the chairman of the company
union had already been designated by management. Lack of freedom
11 O n e lim ite d reelectio n to “ n o t m ore th a n four ter m s” , an oth er to th ree c o n se c u tiv e term s, tw o to tw o
c o n se c u tiv e term s, an d a fifth to “ n o t m ore th a n tw ic e .” S till an oth er p la n stip u la te d th a t rep resen ta tiv es
co u ld n o t su cceed th em selv es b u t co u ld b e reelected later.
12 T h is w a s th e p roced u re in 64 c o m p a n y u n io n s, or 68 p ercen t of th e 111 o n w h ic h in form ation o n th is
su b ject w a s fu rn ish ed .
is S ix c o m p a n y u n io n s u se d th e p e titio n , th e req u ired n u m b er o f sign atu res ran g in g from 10 persons to
26 p ercen t o f th e vo ters in th e d istrict. N o m in a tin g c o m m ittees w ere u se d in fiv e cases, b u t in th ree o f th ese
n o m in a tio n s w ere also m a d e from th e floor a t em p lo y ee m eetin g s. In tw o cases o n ly filin g of c a n d id a cy w a s
req u ired .
14 In fiv e o f th ese a list o f a ll e lig ib le em p lo y ees w as eith er p o sted on b u lle tin boards b eforeh an d or h a n d ed
to th e vo ters a t th e e lectio n . O n e c o m p a n y u n io n u se d th e p referen tial b a llo t w ith o u t prior n o m in a tio n .
is In form ation o n th is p o in t w a s n o t a v a ila b le o n 36 cases. W h e n electio n s w ere in th e h a n d s o f e m p lo y ee s,
th e su p erv isio n w a s b y a sta n d in g c o m m itte e or a sp e c ia lly a p p o in ted co m m itte e , or th e o u tg o in g rep re
se n ta tiv e s a cted as a sp ecial c o m m itte e for th is p u rp ose.
16 T h is w a s p a rticu la rly tru e in th e case o f jo in t or c o m b in a tio n ty p e c o m p a n y u n io n s. In six oth er
cases electio n s w ere ta k e n o u t o f th e h a n d s o f m an a g em en t b y ch an g es m a d e after M a rch 1933.
17 T h is d o es n o t a p p ly to electio n s to d eterm in e w h eth er or n o t a c o m p a n y u n io n sh o u ld b e se t u p . See
ch . V III.
is In on e o f th ese th e p resen t rep resen ta tiv es h a d b een a p p o in ted b y m a n a g em en t to rep lace e lected rep
resen ta tiv es w h o h a d affiliated w ith th e tra d e-u n io n .
OFFICERS AND REPRESENTATIVES
123
in voting was evidenced in two company unions, where the ballot car
ried the employee’s signature or his check number. In two others,
representatives stated that ballots had to be marked in the presence
of the supervisor or the time clerk.
About 80 percent of the company unions provided for the recall of
a representative in case he failed to carry out his official duties satis
factorily.19 In the great majority of cases recall action could be
carried through entirely by the employees in the representative’s
district. In some cases the representative council or some committee
exercised a check on recall proceedings by employees, while in a few
others it had sole power of removal. In one instance management
could remove a representative without the consent of his constituents.
Three of the company unions studied 20had recalled a representative.
One representative was recalled because, during a discussion on a
wage increase, he strongly urged other representatives to keep in
mind the financial difficulties of the company. In another case, after
the company had put through a wage reduction by means of the
company-union mechanism, one district in derision elected as their
representative a person whom they knew to be incompetent to fulfill
his duties. He later had to be recalled.
Officers.— All but eight of the company unions studied had, in
addition to employee representatives, one or more employee officers
to perform specific duties.21 They were chosen either by the employee
representatives or directly by the workers. Eligibility requirements
for officers were generally the same as for representatives.22
In all company unions functioning on an automatic-participation
basis, as well as in about half of those with optional membership,
officers were chosen by the representatives. In some company
unions all officers and all members of subcommittees were thus
is E ig h ty -o n e p ro v id ed for recall. T h ir ty h a d n o su ch p ro v isio n a lth o u g h on e o f th ese rep orted th a t
d e sp ite th e la c k o f a form al p ro v isio n recall w a s p o ssib le. In form ation w a s n o t a v a ila b le for 12 c o m p a n y
u n io n s, w h ile 3 h a d n o rep resen ta tiv es. In a d d itio n to th ese p ro v isio n s for th e recall o f rep resen ta tiv es
elected d ir e ctly b y th e e m p lo y ees, s e v e n c o m p a n y u n io n s, in w h ic h a p rim ary co u n cil elected from am o n g its
o w n n u m b er rep resen ta tiv es to a h ig h er cou n cil, p erm itted th e p rim a ry co u n cil to recall its rep resen ta tiv es
to th e h ig h er cou n cil.
20 I n an oth er case, m a n a g em en t rep orted th a t a n em p lo y ee rep resen ta tiv e h a d b een recalled , b u t an
e m p lo y ee rep resen ta tiv e in ter v iew e d d id n o t corroborate th is sta tem e n t.
21 In four cases all officers of th e c o m p a n y u n io n ap art from e m p lo y ee rep resen ta tiv es w ere m an a g em en t
officials, w h ile in four oth er cases th e c o m p a n y u n io n fu n ctio n ed en tirely th ro u g h a sm a ll in form al co m
m itte e o f rep resen ta tiv es elected a t large b y th e em p lo y ees.
22 A n y d istin c tio n s w h ic h w ere m a d e u su a lly in v o lv e d su ch slig h t m a tters as a few m ore m o n th s’ service
w ith th e c o m p a n y , or a yea r or tw o m ore in age. T h u s th e figures a lread y g iv e n as to th e ten u re of e m
p lo y m e n t, age, c itizen sh ip , an d e d u ca tio n req u irem en ts for rep resen ta tiv es a p p ly on th e w h o le to th e officers
o f th e c o m p a n y u n io n s. In all cases officers, excep t fu ll-tim e p a id officials in so m e cases, h a d to b e e m
p lo y ees a t th e tim e o f electio n . C o m p a n y u n io n s p e r m ittin g rep resen ta tiv es to serv e after le a v in g th e
em p lo y o f th e c o m p a n y also ex ten d ed th is p ro v isio n to th e officers.
T h e term o f office o f officers w as, in all b u t o n e case, th e sa m e as for rep resen tatives. In th is excep tion al
case, officers serv ed for 2 yea rs, as ag a in st 1 yea r for rep resen tatives.
F e w c o m p a n y u n io n s m a d e form al p ro v isio n w ith regard to reelectio n o f officers. M o st o f th e m seem ed to
ta k e it for gra n ted th a t if a n officer w a s reelected as a rep resen tative, h e w a s sim ila rly eligib le for reelection
as an officer. L ik ew ise, in th o se few c o m p a n y u n io n s p la cin g restrictio n s on th e reelectio n o f rep resen tatives,
officers w ere su b ject to th e sa m e term s.
124
CHARACTERISTICS OF COMPANY UNIONS
elected. In others, one or two key officers were elected and they, in
turn, appointed other officers and the necessary committeemen. In
all but a few instances officers had to be chosen from among the
representatives.
Direct election of officers on a scheduled election date by the
membership at large occurred in about half of the optional-membership
company unions. In one, for instance, candidates for all offices were
nominated from the floor at the annual membership meeting. The
names of all the candidates were then posted in each department at
least 10 days prior to the date of election. Officers were then elected
on the scheduled date by secret ballot of all qualified voters.
A few of the company unions in which employees did not directly
elect officers provided for the removal of such officers by the repre
sentatives. In the large majority, the officer could be removed only
by indirect means. Where his constituency refused to recall him as
a representative, or had no such power, there was no legally recognized
means of removing him as an officer of the company union. On the
other hand, in almost half of the company unions with direct election
of officers the recall was permitted.
Compensation to representatives and officers.— Representatives were
compensated for their work in 90 percent of the cases. In most cases
this compensation was at the regular rate of pay for time spent
during working hours. It thus served to assure the representative
that his earnings would not suffer as a result of attendance at meetings
or performance of other company-union work during working hours.
About one-third of the company unions paid the employee repre
sentative something above his regular earnings, making the position
a source of extra income to him.23 In 10 cases, the extra compensation
amounted to $50 or more a year; in 1, to as much as $15 a week.
Seven company unions paid their representatives out of independ
ently financed treasuries. In the great majority of cases the em
ployer paid representatives directly.24 In some instances, however,
they were paid out of company-union treasuries to which management
regularly contributed. One company union used its own funds to
pay representatives for work done outside of hours, while the company
paid for time lost during the day.
Employee officers who, while retaining their jobs, assumed duties
with respect to the company union received extra compensation for
23 One hundred and four provided compensation and 11 did not pay representatives.
was not available on seven company unions, while three had no representatives.
Information
S ix ty -fiv e co m p a n y u n io n s p a id o n ly a t th e w a g e rate for tim e lo st d u rin g w o rk in g hou rs. T h irteen
oth ers p a id a t w ag e rate for tim e sp e n t b o th d u rin g a n d after w ork in g hours. E le v e n p a id w a g e rate for
tim e lo st d u rin g th e w ork in g d a y p lu s so m e stip u la te d su m per m eetin g or per d a y , w eek , or m o n th . S ix
tee n oth ers p a id rep resen ta tiv es so m e stip u la te d a m o u n t b u t it is n o t p o ssib le to te ll in all o f th ese cases
w h eth er a n y w ork in g tim e w a s sp e n t b y th ese r ep resen tatives an d , if so, w h a t th e rela tio n w a s b etw een
th is tim e lo st a n d th e flat co m p en sa tio n rate. In m o st o f th ese 16 cases, it w o u ld ap pear th a t th e n e t result
w a s to create so m e a d d itio n a l in co m e for th e rep resen tative. F or a case of an oth er form of com p en sa tio n ,
see footn ote 32, b elow .
24T h is w a s tru e in 91 cases in clu d in g , w ith 5 excep tio n s, all cases w h ere th e w ag e rate w a s p a id .
Officers
and representatives
125
these services in 15 instances.25 This extra income amounted to $120
or more a year in two-thirds of the cases. In eight cases officers were
paid out of company-union treasuries built up from dues payments,26
while in five they were paid directly by the company. In two they
were paid out of treasuries to which the company contributed regu
larly.
Information is incomplete as to what control, if any, was exercised
by the company over the amount of time which representatives and
officers might spend on company-union business. In some cases in
which they were paid by the employer they were free to spend as
much time as they felt necessary. Thus in one plant many of the
representatives did very little besides shop-council work, the president
of the company union stating that he worked less than six hours a
week on his regular job. In another case an employee representative
who was also a union member stated: “ A representative is free at
any time to investigate a problem. He just tells the foreman, who
asks no questions.” On the other hand, many constitutions provided
reimbursement only for earnings lost while in attendance at regular
meetings or at special meetings or conferences jointly approved.
Some companies allotted a definite time period to the representatives
for transacting their duties. Others which paid representatives for
time spent in meetings frowned upon any discussions or contacts
between employee representatives and their constituents during
working hours.27
Salaried full-time officials.— Eight company unions among the 126
had salaried executive officers who devoted their full time to companyunion affairs. In some instances such officers were paid directly or
indirectly by the employer. Thus in one company having a number
of branch plants, employee representatives selected the officer, but
the employer paid his salary of $40 a week and his traveling expenses.
Management gave him full freedom to visit any plant whenever he
thought necessary. In two cases, the salary of the full-time officer
was paid out of the company-union treasury to which the company
contributed.28 Five company unions paid a full-time official out of a
treasury to which the company did not contribute.29
25 R e p resen ta tiv es w ere n o t p a id in 3 of th ese 15 cases in w h ic h officers w ere p a id . In eig h t cases o n ly th e
secretary or secretary-treasu rer w a s p a id . T h e secretary o f on e c o m p a n y u n io n received $2 for each m e e t
ing; in oth er cases p a y m e n t w as b y th e w eek , m o n th , or yea r a t a rate ran g in g from $1.50 a m o n th to $50 a
m o n th . In o n e c o m p a n y u n io n in w h ic h rep resen ta tiv es w ere p a id $15 a m o n th , th e p resid en t received
$30 a m o n th , th e ch airm an of th e w ag e an d w elfare co m m itte e $25 a m o n th , an d th e m em b ers o f th a t
c o m m itte e $20 a m o n th .
26 In tw o o f th ese in sta n ces, h o w ev er, th e co m p a n y p a id officers th e regular w ag e rate for a n y tim e lo st on
co m p a n y -u n io n w ork d u rin g w o rk in g hou rs, w h ile th e co m p a n y u n io n p a id th e m an ad d itio n a l fixed a m o u n t
p er m o n th .
27 F or fu rth er d iscu ssio n o f th is p o in t, see ch . X I V , p . 141.
28 O n e p a id its b u sin ess ag en t $150 a m o n th , b u t th e co m p a n y co n trib u ted a lik e a m o u n t each m o n th to
th e a sso cia tio n ’s treasu ry . In th e o th er case th e secretary, w h o h a d h eld th is office for sev era l yea rs, had
b een h ired b y th e c o m p a n y a n d w a s in effect p a id b y it, sin ce it gu aran teed a n y d eficit in th e treasu ry , and
th ere w a s a lw a y s a con sid erab le d eficit. In form ation as to th e a m o u n t o f sa la ry w as n o t a v aila b le.
2« In on e in sta n c e , th e c o m p a n y fu rn ish ed an office for th e fu ll-tim e official.
126
CHARACTERISTICS OF COMPANY UNIONS
Salaries ranged from $1,500 to $3,900 a year. The highest salary
was paid to the chairman of an association which functioned primar
ily as a benefit association.30 The bylaws in one case stipulated that
the business agent “ shall receive a weekly salary to be fixed by the
shop committee.” He received $2,300 a year, half being paid by the
company union and half by the benefit fund, which was run by the
company union but to which separate membership applied.
Only one constitution specifically provided that the full-time sal
aried official need not be an employee of the company at the time of
selection. One constitution had no references to any requirement,
but persons interviewed stated that the paid chairman might be an
outsider. The incumbents were all former employees who, upon
election to this office, either resigned or were granted leave from their
jobs.31
Of these eight full-time paid officials, three of those paid by inde
pendent treasuries and one paid by the company displayed a real
ability for leadership in the adjustment of grievances and the ad
vancement of the wages and working conditions of the members.
Two others, while capable and aggressive, interested themselves pri
marily in benefit and welfare work. Another appeared to be of in
different ability and was most concerned with preventing difficulties
from coming to the surface. One of the best-paid officials was not
the real leader of the organization. It was controlled, instead, by
the organizer of the company union, who at the time of the study
was serving only as a representative.
Independence of officers and representatives.— Effective representa
tion of the interests of employees requires that representatives shall
at all times feel free to raise with management the complaints or issues
brought to them by their constituents. The fact that companyunion representatives are themselves employees of the company, and
that they are unsupported by an organization or group outside the
sphere of the company’s authority makes necessary some form of as
surance that vigorous action will not jeopardize their own jobs or
standing with the company.
Recognition of this fact is evidenced by the frequency with which
there was a declaration of intent on this point by the employer.
Somewhat more than half (57) of the constitutions contained a clause
binding management to avoid discrimination against company-union
representatives. The most common “ guarantee of independence”
clause read as follows:
30T h e c o m p a n y c o n trib u ted to th e b en efit fu n d th ro u gh a p rofit-sharing arran gem en t. T h is sa m e ch air
m a n p r o m o ted th e e sta b lish m e n t o f th e c o m p a n y u n io n w h ile a strik e w a s ta k in g p la ce in th e p la n t.
31O n e in c u m b e n t, form erly m an a ger o f a b ran ch for th e co m p a n y , h a d serv ed th e c o m p a n y u n io n for 10
y ea rs a n d w a s n o lon ger con sid ered a n e m p lo y ee o f th e c o m p a n y . A n o th e r w a s e m p lo y ed b y th e c o m p a n y
to m a n a g e th e w elfare fu n d before th e w elfare a ssociation b eca m e a rep resen tation a g en cy , a n d co n tin u ed
o n in th e sa m e c a p a city after th e ch an ge. T h e p a id ch airm an in a n oth er case sta te d th a t, if d efea ted for
reelectio n , h e w o u ld retu rn to h is p o sitio n as m an ager o f a b ran ch for th e co m p a n y .
OFFICERS AND REPRESENTATIVES
127
I t is understood and agreed th a t each representative shall be free to discharge
his duties in an independent m anner, w ithout fear th a t his individual relations
w ith the com p an y m a y be affected in the least degree b y any action taken b y him
in good faith in his representative capacity.
Another clause frequently used was:
E v ery representative serving on a n y division com m ittee, plan t council, com
m ittee of p lan t council, or on th e jo in t council shall be w holly free in the perform
ance of his duties as such, and shall n ot be discriminated against on account of any
action taken b y h im in good faith in his representative capacity.
Three companies made a declaration on the subject either through
the employees’ handbook or by letter to the company union. It was
made a part of the formal agreement between the company and the
company union in one case. In the remaining cases no specific guar
antee of independence existed.32
In only one case did the company union itself, an organization of
the optional-membership type, undertake to assure independence.33
To protect the independence of its officials, it included an arbitration
provision in its constitution. The acceptance of the provision by
management implied its participation in the guarantee.
A ll officers and representatives shall act w ith scrupulous fidelity to th e associ
ation and its m em bers.
T o assure their independence of action a ny com plaint
of personal discrimination against th em , or any of th em , because of authorized
acts or conduct, shall be tak en up prom p tly w ith th e m anagem ent and, if n ot a d
ju sted p ro m p tly, shall be referred to a board of arbitration as set up in article
Thus the guarantees ranged from simple encouragement, with
out any defined procedure for redress in case of violation,34 to specific
restrictions upon changes in the employment status of representatives.
One constitution protected its representatives from future discrimina
tion in the following manner:35
A n em ployee who has a t an y tim e served as a councilm an or deputy shall not
be transferred, dem oted, laid off, suspended for disciplinary reasons, or discharged,
nor shall his in dividual rate of p ay be decreased until th e m ill m anager, or the
corresponding executive, after personal consideration and investigation, has ap
proved th e contem plated action.
One provided that a representative could not be dismissed “ during
his term of office, or for 6 months thereafter” , unless the cause for
32 In o n e case an u n d ersta n d in g h a d g ra d u a lly arisen b etw een m a n a g em en t an d th e c o m p a n y u n io n th a t
rep resen tatives w o u ld b e gu aran teed a fu ll y ea r’s e m p lo y m en t an d p u t o n h o u rly w ag e jo b s w ith o u t p rom o
tio n or d em o tio n d u rin g th e yea r. S in ce th e p la n t op erated o n a season al ba sis, gu aran tee o f a fu ll yea r’s
w ork a m o u n ted in effect to a 3 to 6 m o n th s’ b o n u s. T h e resu lt w a s to m a k e th e p o sitio n o f rep resen ta tiv e
m u ch so u g h t after. A . m easu re to gu aran tee in d ep en d en ce th u s b eca m e a form of co m p en sa tio n for rep re
se n ta tiv e s.
33 S o m e oth er c o n stitu tio n s a ssu m ed th a t d iscrim in ation m ig h t b e e m p lo y ed a g ain st a rep resen ta tiv e b y
em p lo y ees as w ell as b y m a n a gem en t:
“ N e ith e r th e c o m p a n y nor th e e m p lo y ees sh a ll d iscrim in ate ag ain st a n y rep resen ta tiv e on accou n t of a n y
p o sitio n ta k e n in th e free exercise of h is o w n co n v ictio n s w h ile d isch argin g his d u ties as su ch r ep resen ta tiv e.”
34 T h is w a s tru e in 22 of th e 57 c o n stitu tio n s con ta in in g a gu aran tee clause.
35 T h is p rov ision an d th e follow in g on e w ere ad d ed b y c o n stitu tio n a l ch an ges m a d e after M a rch 1933.
128
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
dismissal was first approved by the joint council. If the council vote
was tied, the matter was to be referred to the president of the com
pany for final decision. Another provided that—
In th e even t a councilm an or ex-councilm an be laid off or transferred to another
section, th e executive com m ittee shall b e satisfied no discrimination has been
shown.
In about 40 percent of the 35 company unions where a procedure for
redress was provided, appeals regarding alleged discrimination were
confined to successive officials of the company.
T o insure to each representative his right to such independent action, he shall
h ave th e right to tak e th e question o f an alleged personal discrim ination against
him , on account of his acts in his representative capacity, to a n y o f th e superior
officers, to th e general jo in t com m ittee, and to th e president of th e com p any.
About an equal proportion of the constitutions provided arbitration
of discrimination cases by an impartial outside agency. In onefifth of the instances the case might be carried to the State Department
of Labor or to the Secretary of Labor of the United States. One
permitted appeal to the Regional Labor Board.
Among the company unions studied this elaborate machinery for
arbitration had never been invoked by an individual representative
who charged discrimination for his activity in the company union.
The study revealed few cases in which charges were made that
management had discriminated against company-union officials and
representatives who were active in the interest of the employees.
There were five cases in which workers related discharge or failure to
rehire after lay-off to activities in connection with the company union.
In one instance where the company union had a formal guarantee
of independence in its constitution but no machinery for redress, the
company discharged two employee representatives after they had
openly opposed certain activities of the president and founder of the
company union. Even though there was some sentiment among the
rank and file against the discharge of the two men, no attempt was
made by the other representatives to have them reinstated.
In another company in which representatives and ex-representatives
could not be laid off or transferred unless the executive committee was
satisfied no discrimination was being shown, a “ very active and
energetic member of the works council” who, according to the company
union committee, “ had drawn much attention to himself by his fearless
and aggressive attitude in the council” , was not rehired when work
was resumed in his division following a lay-off. Despite the attempt
on the part of the company union to obtain his reinstatement, the
O F F IC E R S A N D R E P R E S E N T A T I V E S
vice president refused to reverse the manager's decision.
mittee's report concluded as follows:
129
The com
Our com m ittee still believes th a t th e reem p loym ent of M r . ------------ w ould have
resulted in a m u ch better feeling between th e m an agem ent and th e great m ass of
em ployees, and w ould h av e reacted to th e benefit o f th e com p an y and it is with
regret th a t w e m u st now report th a t an y im m ediate further a ctiv ity on th e part
of th is com m ittee a t the present tim e seems fu tile b u t w ould recom m end th a t the
case be le ft in our hands to forward a t the proper tim e to the end th a t M r . -----------m a y finally be reinstated.
The other three cases of discharge of representatives were in com
pany unions having no guarantee of independence. In one, the
president of the company union was discharged for visiting officials
of company unions in neighboring communities. In the second, when
the company union voted to affiliate with the trade-union, the com
pany discharged an entire shift containing the former president of
the company union and a number of those active in the affiliation
movement. The company then reestablished the company union,
and a new set of officers took charge. In the other, an employee
representative who had fought for wage increases was discharged after
having worked for the company for more than 4 years.
Chapter X II I
Committees
Three types of committee machinery prevail among company
unions— the joint committee of employer-employee representatives,
the joint committee accompanied by occasional or regular employeecommittee meetings, and the employee-committee arrangement. The
joint committee is a body composed of representatives of both man
agement and employees. The employee committee is composed only
of employee representatives. It meets to formulate requests either
for presentation to a joint committee, or for discussion and negotia
tion with one or more management officials as occasion arises.
The pure joint-committee type of organization makes no provision
for separate meetings of employee representatives.1 It is based on
the conception that difficulties and questions between employer and
employees can be settled satisfactorily and justly by discussions of
individuals around a conference table. It assumes that employee
representatives as individuals have no hesitancy in expressing their
opinions and the demands of their constituents before their employers.
The employer is necessarily a party to the functioning of the jointcommittee type of company union. As a corollary of this fact,
extensive employer participation exists in their establishment, opera
tion, and financing. Of the 21 joint-committee type organizations
studied, all but 1 were set up entirely by management. Not only
did their constitutions indicate the participation of management
through the joint committees, but two-thirds of the constitutions
explicitly announced that management was setting up the organiza
tion for the employees. None of them provided a choice with regard
to membership. All were based on automatic participation by reason
of employment. None which provided for termination could be
terminated without the consent of management. Two-thirds required
the consent of management for any amendment to the constitution.
None provided for employee dues or financial contributions, all
relying entirely upon management for funds.
The second type of committee arrangement, hereafter referred to
as the combination type, holds to the same philosophy of joint action
1
S ev en c o m p a n y u n io n s in th is group, h o w ev er, h a d m o v e d so m ew h a t from th is p o sitio n b y p e r m ittin g
in form al cau cu ses o f e m p lo y ee rep resen ta tiv es before th e jo in t m eetin g s. In su c h cases th e d ifferen ce
b e tw e e n th e jo in t-c o m m itte e ty p e a n d th e secon d or co m b in a tio n ty p e b ecom es less d istin c t. H o w e v e r ,
th e y differ w ith regard to th e reg u la rity o f th e sep ara te m eetin g s o f em p lo y ee rep resen ta tiv es a n d th e a u
th o r ity w h ich seem ed to b e v e ste d in or exercised b y th ese m eetin g s.
130
C O M M IT T E E S
131
but assumes that employee representatives should meet by themselves,
at least occasionally.2 Separate meetings of employee representa
tives are considered necessary in order that they may arrive at a clear
understanding of the wishes of the group, the procedure to be followed
in presenting such wishes, and the selection of a spokesman who can
most effectively present the common opinion of the group. It thus
differs from the joint-committee type in that the employee repre
sentatives are more definitely the representatives of a group point
of view.3
Here again management representation is an essential part of the
structure of the joint committee, although as far as other activities
are concerned, management participation has been less extensive
than in the straight joint-committee type. Of the 20 organizations
having this combination arrangement, only 7 definitely stated in
their constitutions that they were set up by management, while 2
stated that they were employee-sponsored.4 Two could be termi
nated by action of the employees alone. Although most of them
were based on automatic-participation rights for all employees, onefourth had optional membership. One provided* for dues, the
remainder relying entirely upon management for expenses.
In the third type of committee arrangement, there is no necessary
management participation in the operation of the company union.
The structure tends to stress the existence of an exclusive employees'
agency. Representatives of employees meet alone5 to discuss prob
lems and grievances and, as a united group, present their formulated
2 S o m e p la n s sp e c ify th a t th e sep ara te m eetin g s are to ta k e p la ce before each jo in t co u n cil m e etin g , oth ers
p ro v id e th a t sep ara te m e etin g s a n d jo in t m eetin g s are to b e altern a ted . In so m e cases th e jo in t c o m m itte e
is form ed b y a d d in g to th e e m p lo y ee c o m m itte e tw o or th ree rep resen ta tiv es of m a n a g em en t.
3 T w o co m b in a tio n ty p e c o m p a n y u n io n s d id n o t a c tu a lly h o ld sep ara te m eetin g s o f e m p lo y ee rep resen t
ativ es. I n o n e, w h ic h d id n o n eg o tia tin g , tw o m a n a g em en t rep resen ta tiv es c a m e to b e p resen t a s a m a tte r
of course. T h e oth er p r o v id ed th a t th e gen eral c o m m itte e a n d all sta n d in g c o m m itte e s o f e m p lo y e e r ep
resen ta tiv es sh o u ld m e et o n altern a te m o n th s a s jo in t c o m m itte e s w ith a n eq u a l n u m b er o f m a n a g em en t
rep resen tatives. I n a d d itio n , a sp e c ia lly d esig n a ted m a n a g em en t rep resen ta tiv e w a s to b e a v a ila b le to
a tte n d sep ara te m e etin g s o f th e gen eral c o m m itte e o f e m p lo y ee rep resen ta tiv es o n in v ita tio n . I n v ite d to
th e first m e etin g h e a tten d e d a ll su b seq u en t o n es as a m a tte r o f course. A s a resu lt, th e jo in t gen eral c o m
m itte e fell in to d isu se, o n ly th e jo in t sta n d in g c o m m ittees co n tin u in g to fu n ctio n o n a jo in t b a sis. A t th e
sa m e tim e th e gen eral c o m m itte e o f e m p lo y ee rep resen ta tiv es w a s sh o rn o f a n y le g isla tiv e p o w er. I t s w o rk
w as lim ite d to h earin g th e rep orts o f th e jo in t sta n d in g c o m m itte e s b u t it co u ld n o t overru le th em ; it co u ld
o n ly ap p ea l from th eir a ctio n to a jo in t ap p ea ls c o m m ittee. T h e jo in t ap p ea ls c o m m itte e h a d n o t b een
called o n to act in th e p a st 9 years.
In on e large organ ization , th ere w ere n o sep arate m eetin g s of all em p lo y ee rep resen tatives, b u t su c h m e e t
in g s w ere h e ld b y th e e m p lo y ee rep resen tatives of th e fiv e d iv isio n a l w a g e an d w elfare co m m itte e s. T h e se
co m m itte e s, each co n sistin g o f ch airm an a n d four m em b ers e lected b y th e d iv isio n a l e m p lo y ee rep resen t
a tiv e s, m e t m o n th ly . M a n a g e m e n t a tten d e d th ese m e etin g s o n ly o n req u est. T h e w a g e c o m m itte e s
w ere im p o r ta n t, h a n d lin g a ll p rob lem s p erta in in g to h ou rs o f w ork , rates o f p a y , e tc. E a ch d iv isio n h a d a
jo in t c o m m itte e also, w h ic h serv ed as a cou rt o f first a p p ea l from th e w a g e a n d w elfare c o m m itte e s. In
a n oth er, a n d e q u a lly large, c o m p a n y th e o n ly sep ara te m eetin g s p ro v id ed for w ere m o n th ly m eetin g s of
th e e x e c u tiv e c o m m itte e w ith each o f fiv e d iv isio n grou p s o f e m p lo y ee r ep resen tatives.
4 A c tu a lly o n ly o n e w a s p rim a rily esta b lish e d th ro u g h e m p lo y ee in itia tiv e .
8
A lth o u g h th e em p lo y ee-rep resen ta tiv es’ c o m m itte e u su a lly m e ets b y itself, g en erally a t a sta te d tim e
an d u n d er th e d irection o f its lea d in g officer, o n e or m ore m a n a g em en t rep resen ta tiv es m a y a tten d on
req u est or, in so m e instaD ces, b y co n stitu tio n a l p rov ision . T h e se m a n a g em en t rep resen tatives, h o w ever,
do n o t form a p art of th e co m m itte e an d d o n o t v o te . T h e y a tten d to a d v ise an d to sta te m a n a gem en t
p o licy .
132
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
plans and requests to management. These meetings with manage
ment do not take the form of joint-committee meetings where a
decision is reached by a vote of the joint body. They are, rather,
meetings of representatives of two parties for the purpose of negotiat
ing or discussing certain matters. If the committee is not satisfied
with the decision given by the management representative it can,
according to the provisions made by many company unions, appeal
to a higher official or authority, such as the president of the company
or the board of directors.
Even in this type, however, management’s relationship to the
organization was frequently so close as to blur the distinction between
the several types.6 Although management participation was not as
apparent as in the joint-committee arrangement, it was, nevertheless,
extensive. All but 18 of the 80 organizations of this type were set up
entirely by management. More than half relied entirely on manage
ment for funds. In almost all instances, management through the
constitution assumed certain obligations.7 However, one difference
from the other types of committee was that automatic participation
of all employees was not as prevalent among the employee-committee
type, nearly two-thirds being based on optional membership.
The possibility of an exclusive employees’ agency becomes greatest
among this last group of 51 company unions which combine the
employee committee with optional membership. The 8 company
unions set up primarily through employee initiative took this form
in all but one case. Only 2 of the 51 company unions with this
form explicitly indicated management sponsorship in the constitu
tion. Even among this group, however, the close relationship of
management was marked. More than two-thirds were set up through
management initiative. Only five constitutions contained no refer
ence, explicit or implicit, to management’s relationship to the affairs
of the company union. One-third of the associations obtained all
their funds from the employer, and most of the remainder received
some financial assistance from management.
Since 1933 there has been a shift away from the joint-committee
type and to a less degree away from the combination type. (See
table 32.) Revisions in individual plans after 1933 show that the
8 B eca u se o f th is essen tia l sim ila rity in m a n y cases, th e classification o f c o m p a n y u n io n s in th is rep ort is
n o t g en erally b y c o m m itte e ty p e b u t rath er on th e b a sis of th e character of p a rticip ation , w h eth er au to m a tic
or o n a n o p tio n a l m em b ersh ip basis.
7 O n th e oth er h a n d , w h ere th ere w a s specific m en tio n of sp on sorsh ip in th e co n stitu tio n s, th e em p lo y ees
w ere m ore freq u en tly n a m ed th a n m a n a g em en t.
C O M M IT T E E S
133
movement is to some extent from joint committees through the com
bination type to employee committees.8
Varying factors played a part in effecting these shifts. In some
it was directly traceable to a desire on the part of management and
workers to comply with what they felt were the requirements of
section 7 (a). In a number of cases management, stimulated by
legislation and labor-board rulings, took the initiative in modifying
plans in order to give a formal appearance of greater independence.
In a few others, revision was instituted by the workers themselves.
In these instances, employee representatives reported that they had
felt the need for an opportunity to talk over matters by themselves.
In one, employee representatives had gradually become accustomed
to having meetings by themselves to decide on matters to be taken up
CHART 6
COMMITTEE MACHINERY IN COMPANY UNIONS
JOINT
COMMITTEE
US.BUREAU O r LABOR STATISTICS
COMBINATION
EMPLOYEE
AND JOINT
COMMITTEE
at the joint-council meeting. Decisions then made by the joint
council were taken up with the general superintendent, who rendered
the final decision. This system was so cumbersome that the joint
meetings were finally abandoned, and the employees’ committee took
its complaints up with the general superintendent directly. In
another, the apathy of the workers toward the company union was
responsible for abandoning separate and formal joint-council meetings,
8 T h u s, o f th e 10 jo in t co m m itte e s w h ic h rev ised th eir form after M a rch 1933, 6 ch an g ed to c o m b in a tio n
ty p e s an d 4 to e m p lo y ee c o m m ittees. T w o c o m b in a tio n arran gem en ts w ere m o d ified to a stra ig h t em p lo y ee
com m ittee. N o n e ch a n g ed to jo in t-co m m ittee form , a n d n o n e from th e em p lo y ee c o m m ittee.
T o th ese ch an g es m a y b e a d d ed certain oth er sh ifts. T h u s a c o m p a n y w h ic h for several yea rs u p to 1930
h a d h a d a n in d u strial-d em ocra cy ty p e o f c o m p a n y u n io n d rop p ed th e p la n a t th a t tim e. In 1933 it se t u p
a c o m b in a tio n p la n . In a d d itio n , th ree jo in t-c o m m itte e organ ization s a m en d ed th eir c o n stitu tio n s d u rin g
th e N . R . A ., to g iv e e m p lo y ee rep resen ta tiv es th e rig h t to m e et sep ara tely.
F ou r o th ers ch an g ed th eir co n stitu tio n s to p erm it m a n a g em en t to a tten d m eetin g s of e m p lo y ee s’ council
o n ly on in v ita tio n , in stea d of b y righ t o f sp ecific c o n stitu tio n a l p ro v isio n .
134
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
the representatives merely conferring with the superintendent when
occasion arose.
T
a b l e 3 2 . — C o m m itte e m a c h in e r y in c o m p a n y u n io n s , s p r in g o f 1 9 3 5 1
P eriod of organ ization
T y p e of co m m ittee
Jo in t c o m m itte e ___ __ _ ____ __ ____________ ______ - ____ ________
C o m b in a tio n em p lo y ee an d jo in t c o m m itte e _____ _______________ ________
E m p lo y e e c o m m itte e _____ - ____________ _____ ___________ ______ ______
In d u stria l d em ocracy 2__ ______________ ____ ___________________ - _____
N o in fo rm a tio n ______________________________________ ______________________
T o ta l
_
____________________________________ _ _ _ _ _ _ _
T o ta l
21
20
80
2
3
126
B efore
N . R. A.
11
7
10
2
0
30
U n d er
N . R. A.
10
13
70
0
3
96
1 C o m p a n y u n io n s are h ere classified accord in g to th eir p resen t form rather th a n th eir form a t th e tim e of
organ ization . If th e e x istin g c o m p a n y u n io n s d a tin g from before th e N . R . A ., in c lu d in g th e 6 p la n s re
esta b lish ed in 1933, w ere classed accord in g to th e form w h ic h th e y follow ed before 1933, th ere w o u ld b e a slig h t
b u t n o t a sig n ifican t ch an g e in th e figures. T h e figures w o u ld th e n be: J o in t co m m itte e 13; co m b in a tio n
e m p lo y ee an d jo in t c o m m itte e s 8; e m p lo y ee c o m m itte e 12; in d u stria l d em ocracy 3.
2 In th is form o f c o m p a n y u n io n , th e e m p lo y ee rep resen tatives, elected b y th e w orkers, c o n stitu te th e
hou se; su p erv iso ry officials a p p o in ted b y th e c o m p a n y com p rise th e senate; an d a few m an a g em en t officials
m a k e u p th e ca b in et. M a tter s m a y orig in ate in eith er h o u se a n d after p assage go to th e secon d h ou se. If
th e 2 h o u ses ca n n o t agree, a jo in t c o m m itte e sim ila r to a conference c o m m ittee o f th e U n ite d S ta tes C ongress
a tte m p ts to arrive a t a co m p ro m ise a c c e p ta b le to b o th h o u ses. M a tter s p a ssed b y b o th h ou ses go to th e
c a b in e t for a p p ro v a l or v e to . T h is form , w h ic h b ecam e p o p u la r d u r in g th e W o rld W ar p eriod , h a s b een
la r g ely a b an d o n ed b ecau se of its cu m b erso m e stru ctu re.
Divisional committees and subcommittees .— In smaller establishments,
the company union usually functioned through a single council or
committee, whether joint or of employee representatives only. To
this body came all grievances which employee representatives had
been unable to adjust, and it considered in full session all matters
handled by the company union. More than half of the company
unions, however, distributed the work among a number of committees
which either had full responsibility for the functioning of the company
union in a particular division or unit of the company or had certain
authority with respect to the consideration of particular matters.
In 28 large companies or companies with a geographically scattered
or otherwise complicated structure, separate committees were set
up for each division, or other appropriate unit of the company.
These were integrated into a central committee through representa
tion either directly or through one or more intervening committees,
depending on the complexity of the company’s structure. Employee
representatives on a superior council were chosen by and from among
the employee representatives on the council next below it in the
hierarchy. Each divisional council attempted to settle the griev
ances and problems arising in that particular division of the company’s
operatives, after the employee representative concerned had failed.
If it did not succeed, it passed them on to the next higher council for
settlement. In some organizations only matters of general impor
tance could be carried to the council higher up, and matters of interest
to a division only were settled by that division’s council.
C O M M IT T E E S
135
Fifty-nine company unions set up subcommittees for specific
purposes—wages and working conditions, cafeteria, safety and health,
grievances, and other matters.9 These subcommittees performed
much of the preliminary work, work which might otherwise have had
to be done by the full committee. In some cases, the grievance com
mittee attempted to settle grievances before they were turned over
to the full committee, or conferred with management on the matter
after approval by the full committee. The standing wage committee
sometimes not only investigated cost of living and other pertinent
facts but also served as the negotiating committee on questions of
wages and hours. One company union required that all questions
be acted on by the appropriate subcommittee before action could be
taken by the full committee.
On all divisional committees or standing subcommittees in jointcommittee type organizations, management had equal voting power
with employee representatives. Conversely, in employee-committee
type company unions, only employee representatives served on the
divisional committees or subcommittees. When such committees
were included in the set-up of the combination type of plan, manage
ment representatives were generally excluded entirely or were called
in only on invitation. Where the constitution provided for only
joint subcommittees, an additional clause gave employee representa
tives the privilege of meeting separately before joint subcommittee
meetings or on alternate months.
Procedure at jo in t meetings.— One-half the constitutions providing
for joint committees specified that the presiding officer should always
be a management representative. One-fourth provided for an em
ployee as presiding officer. In the remaining fourth the chairman was
elected by and from the joint-committee members, or the chairman
and secretary alternated between management and employees from
meeting to meeting.10
In about half of the cases the secret vote was provided for, although
it was actually used in a comparatively few instances.11 Three joint
committees rarely put questions to a vote of any kind, while in eight
‘ There was no voting at all— only discussion.”
Three methods of determining whether or not a proposal was carried
were used in joint meetings. In most cases, all the representatives
voted as individuals and a majority of two-thirds or three-fourths
of the representatives present was required. In a few cases, only
9 S ix teen c o m p a n y u n io n s h a d b o th d iv isio n a l co m m itte e s an d sta n d in g co m m itte e s o n sp ecific m a tters.
o n e o f th e la tter cases, h o w ev er, a t th e in sisten ce of th e em p lo y ees, th e person n el m an ager a lw a y s
presided d esp ite c o n stitu tio n a l req u irem en ts.
11 E ig h te e n o u t o f tw e n ty -fiv e o n w h ic h in form ation w a s av a ila b le rep orted u sin g th e secret b a llo t.
T h ree of th ese sp ecified “ a lw a y s” an d an oth er “ u su a lly ” . T h ie e u sed th e secret v o te ord in a rily o n ly on
m ajor issu es. E ig h t oth ers p ro v id ed for a secret v o te u p o n req u est o f eith er m a n a g em en t or em p lo y ee repre
se n ta tiv e s or a m ajo rity o f th e jo in t cou n cil, b u t th e p rivilege w a s rarely u sed . F o u r m ore rep orted th a t
it w as seld o m u sed . In tw o o f th e cases in w h ich a secret v o te w a s n ever u sed th e ru les of p rocedure per
m itte d su ch a v o te .
10 In
136
CHARACTERISTICS OF COMPANY UNIONS
a unanimous vote of the representatives could carry a measure. A
number of company unions used the unit method. Under this method,
the majority of representatives in the employee group and in the
employer group determined how the vote of its group should be cast,
and agreement by both groups was required for approval.
In all but one of the joint committees the constitutions provided
that decision by the joint committee was in effect only a recom
mendation made to management. Although many constitutions
permitted employee representatives to carry matters turned down
by the joint council, to management, such appeals were rarely used.12
Many of the employees’ requests, therefore, never went beyond the
joint-committee stage.
While three-fourths of the constitutions of the combination type
of company union nominally provided that final disposition of ques
tions was to be made in the joint committee, in only two cases was
there an impression among the persons concerned that a decision
of the joint committee could be final without the approval of a
superior officer. The joint-council meetings turned out to be largely
discussion periods, the management representatives having no power
to make decisions. Six of these company unions had never taken a
vote on any issue at the joint meetings.
Where the general manager or owner of the company was a mem
ber of a joint committee with power of decision, the final decision
was in reality made by him acting in his capacity of manager or
owner. Management representatives in one case said:
T h e jo in t council developed sim ply in to a discussion group unless th e business
m anager was present.
I f he was, he m ad e im m ediate reply to the em ployee
requests or replied in writing later.
The ability of the employee representatives to secure favorable
action on their recommendations through joint committees was
affected in some instances by fear of discrimination. This was par
ticularly true when the foremen and immediate supervisors were
among the management representatives. Employee representatives
expressed their fear of bringing up grievances under such circum
stances. As stated by the business agent of one company union,
“ A workingman won’t express himself if the superintendent or fore
man is present at the meeting as he will without them.”
The feeling of inferiority in the presence of the management repre
sentatives sometimes further militated against the workers’ rep
resentatives pressing their recommendations. Thus for example one
representative said:
W h a t chance h ave we against a w ell-educated, very sm art m an like -----------H e is a square
(a personnel officer), who can take advan tage of every loophole?
shooter, b u t
12
*
*
See ch . X V , p . 153.
*.
COMMITTEES
137
Another said that in joint meetings matters which the employees
want are discussed and the management opinion usually prevails:
They are smarter than we are.
out-talk us any day in the week.
And so we just let it go because they can
In case after case the field agents reported that in the joint meetings
all the talking was done by the management representatives. The
employees’ representatives were inarticulate, partly because they
felt unable to answer or question the statements of the management
representatives.
In all equally divided bodies requiring a majority decision, either
side can block action. In these joint committees, representatives of
management had to vote with the employee representatives to carry
a workers’ proposal.13 Similarly, workers had to vote with manage
ment to carry an employer’s proposal.
In the last analysis, however, management was not always depend
ent upon the committees’ decision for putting its policies into effect.
In the large majority of company unions it reserved the right to act
outside the established machinery.14 In practice, it frequently raised
or lowered pay, lengthened or shortened hours, and changed working
rules without waiting for affirmative action by the company-union
council. In contrast, the employees could act only through the
company union on matters of general interest. Inability to obtain a
majority decision of a joint committee, therefore, precluded the passage
of any matter which the employees might want.
Meetings o f employee representatives.— Although separate meetings
of employee representatives, with no management representatives
present, were provided for in more than four-fifths of the companyunion constitutions, one-fourth of these never actually held employeerepresentative meetings without at least one management representa
tive being in attendance.
About 70 percent (90) of the company unions provided for meetings
of representatives once a month or oftener. More than one-half pro*3 U n d er th e u n it sy ste m , a m a jority of th e m an a gem en t rep resen tatives m u st ap p ro ve before a w o rk ers’
prop osal co u ld carry.
T h e d a ta o n actu a l v o te s ta k en in jo in t co m m ittees are m eager, p a rtly b ecau se m a n y c o m m ittees rarely
or n ever to o k a form al v o te . A few in sta n c e s w ere rep orted in w h ic h em p lo y ee rep resen tatives sp lit th eir
v o te s, b u t n o n e in w h ic h m a n a g em en t rep resen ta tiv es d iv id ed o n a form al v o te .
14O n e co n stitu tio n h a d a p ro v isio n th a t “ T h e m an a g em en t sh a ll inform th e co m m itte e o f em p lo y ee
rep resen ta tiv es o f all ch an g es w h ic h it d esires in w a g e scales, h ou rs o f lab or, or oth er w o rk in g co n d itio n s
of a m ajor ch a racter.” A ll su c h ch an g es req u ired a tw o -th ird s v o te o f th e c o m m itte e o f e m p lo y ee repre
se n ta tiv e s. I n th e e v e n t th a t th is v o te w a s n o t o b ta in ed , m an a g em en t m ig h t su b m it th e m a tte r to
arb itratio n , “ b u t in n o e v e n t sh a ll th ere b e a lock -ou t or oth er in d ep en d en t actio n b y m a n a g em en t or
its r ep re se n ta tiv e s.” A lth o u g h th is c o n stitu tio n a l p ro v isio n im p lie d th a t a ll im p o rta n t m a tters w o u ld
n ecessarily com e before th e c o m m itte e , th e h ead o f th e co m p a n y u n io n com p la in ed th a t th e m eetin g s w ere
con fin ed to m ore or less in sig n ifica n t top ics.
154 8 7 5°— 38-------10
138
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
vided for monthly meetings.15 The larger organizations favored
monthly meetings. One company union held representative meetings
bimonthly, and four quarterly. One of the latter occasionally held
meetings “ on call” between quarterly meetings. Another of these 4
was a company union in which the central committee, composed of
the chairmen of 10 widely scattered plant committees, met quarterly.
At the plants studied, no separate meetings of the local plant committee were held. As a result, neither the rank-and-file workers nor
the local employee representatives had any effective contact with or
influence on the business conducted by the central committee.
Fourteen company unions— 11 percent of the total— did not hold
regular meetings of representatives but met only on call or as the
occasion arose. These were primarily in the smaller companies.16 In
four there was some indication that meetings were held rather fre
quently. In a fifth, while the employee representatives met only
occasionally, the executive board, consisting of the officers of the com
pany union and some of the employees’ representatives, met monthly.
General membership meetings were held biweekly in another case,
although representatives met irregularly. The secretary of another
stated that when meetings were held regularly, as stipulated by the
constitution, it was impossible to get out enough employee representa
tives to form a quorum. As a consequence, the president began to call
meetings once or twice a month as “ necessary.” In the remaining
company unions where representatives did not meet regularly, the
irregularity was accompanied or caused by an indifference on the part
of the workers and representatives toward the company union.
T
able
33.— Frequency of company-union committee meetings, spring of 1935
F re q u e n c y
W e e k ly ______
S e m im o n th ly .
M o n th ly _____
B im o n th ly .
Q u a rterly ____
O n c a ll_______
N u m b e r of
com pany
u n io n s
F req u en cy
8 D o r m a n t or d isp la c ed _______ __ . . . _
14 N o e m p lo y ee rep resen ta tiv es 1 ________
68 In c o m p lete or n o in form ation ______
1
4
14
T o ta l
______ ____________________
N u m b e r of
com pany
u n io n s
8
6
3
126
1See ch . X I I , fo o tn o te 1.
Well over half of the total (67) of company unions reported holding
all meetings of employee representatives on company time. In
nearly a third of the company unions, all separate meetings of employee
representatives were held outside of regular working hours and on
16In ta b u la tin g th e freq u en cy o f m eetin g s, th e d eterm in in g factor u sed w h erever p o ssib le w a s p ractice
rath er th a n co n stitu tio n a l stip u la tio n . S everal c o m p a n y u n io n s rep orted d e v ia tio n s from th eir c o n sti
tu tio n s. F ou r sta ted th a t th e y w ere m e etin g often er th a n th e c o n stitu tio n s ca lled for. O n th e oth er h a n d ,
rep resen tatives of tw o c o m p a n y u n io n s w h ic h m e t m o n th ly sh o u ld h a v e m e t often er accord in g to th eir
c o n stitu tio n s.
16O n ly 3 of th e 14 h a d m ore th a n 700 w orkers.
COMMITTEES
139
the workers’ own time. One organization held its meetings on or
off company time, according to convenience. In 11 other cases,
no definite time was given but indications were that the meetings
of representatives were held sometime during working hours. All
but 12 held their meetings on company property. One employees’
committee, eight out of nine of whose members were also members
of the American Federation of Labor local, met at union headquarters.
Chapter X IY
Employee Meetings and Participation
Contact with rank-and-file workers in order to know their aims
and wishes is essential if employee representatives are to be true
spokesmen for their constituents. Of considerable importance in
determining the effectiveness of company unions, therefore, is a con
sideration of the means through which such contacts are made and
the degree to which the views of the rank and file govern its actions.
Although provision is generally made for more or less regular
meetings of employee representatives,1 about 40 percent of the com
pany unions studied had never called the rank-and-file employees
or members together in any kind of group meeting. They relied
entirely upon the informal procedure of isolated discussions between
representatives and workers to maintain the necessary contacts
between them.2 About 60 percent had held at least one membership
meeting. Such meetings were much more common in organizations
with optional membership than in those with automatic participation.
In the latter, where there is no special roll of membership,3 workers in
most cases can express their views and indicate their support for the
company union only by voting in an election once a year. Under such
circumstances it is difficult for the employee representative to know
the attitude of his constituents on general issues. Said an employee
representative in one such case:
We don’t get much backing and therefore we can’t take too much on ourselves
in important cases for fear we’ll find our army has left us.
That there is a desire for guidance is illustrated in those cases
where employee representatives insisted upon a petition being signed
by the affected workers before proceeding to press an issue.4 In a
number of cases petitions served as a partial substitute for the general
employee meeting and a means of measuring the extent and intensity
of popular interest in a particular matter.5
1 See ch . X I I I .
tw o com p a n ies m an a g em en t called m a ss m eetin g s to exp la in w h y req u ests for w a g e in creases cou ld
n o t b e m e t. O n e c o m p a n y u n io n p r o v id ed b y c o n stitu tio n for general m em b ersh ip m eetin g s, b u t in p rac
tic e o n ly th e e m p lo y ee rep resen ta tiv es a tten d e d . A n o th er p e r m itted general m em b ersh ip m eetin g s on
p e titio n o f 60 m em b ers from 3 d ifferen t d ep a rtm en ts. T h e p ro v isio n h a d n ever b een u sed .
a See ch . X , p . 108.
4See. for exa m p le, ch . X V I I I , p . 172.
6P e titio n s w ere fo u n d to b e u n d esirab le b y on e c o m p a n y u n io n co m p etin g w ith a n a c tiv e tra d e-u n io n
in th e p la n t. S h o rtly after th e q u e stio n o f a w a g e increase h a d b een raised b y p e titio n , th e c o m p a n y u n io n ,
after co n su lta tio n w ith th e w o rk s m an a ger, d ecid ed th a t “ U p o n receiv in g a req u est from a n y e m p lo y ee
a b o u t a n y th in g w h ic h con cern s a ll oth er em p lo y ee s in h is d istrict, th e rep resen ta tiv e sh a ll d eterm in e th e
d esires o f th e m a jo rity of th e em p lo y ees in h is d istrict b y p erson al d iscu ssion w ith th e va rio u s in d iv id u a ls
a n d ta k e su c h a ctio n in th e m a tte r a s m a y b e n ecessary to co m p ly w ith th e w ish e s o f th e m a jo r ity . P e ti
tio n s sh a ll n o t b e circu la ted or recogn ized b y rep resen ta tiv es b ecau se it h a s b een p r o v en th a t th e y m a y b e
u se d as a m ea n s o f in tim id a tio n or coercion b y m in o r ity g ro u p s.”
F or a case in w h ic h th e co m p a n y , fo llow in g aggressive action b y th e c o m p a n y u n io n , to o k ste p s to h a m p er
th e c o n ta cts b etw een rep resen tatives a n d w ork ers, see ch . X V I , p . 161.
2 In
140
E M P L O Y E E M E E T IN G S A N D P A R T IC IP A T I O N
141
Some companies made special provision for representatives to secure
the point of view of their constituents. One firm allowed each repre
sentative 1 hour per week for this purpose. Another company whose
employees were scattered over the whole city gave representatives 1
day a week to visit their constituents. A company which had
hundreds of outlets throughout a large metropolitan area allowed each
representative 1 full day before and after each quarterly conference.
The first day was spent visiting each constituent to determine his
opinions in advance of the meeting; the second to report the proceed
ings. In another company it was reported that representatives spent
most of their time hearing and investigating complaints. The impor
tance of the task of keeping in touch with constituents was emphasized
at considerable length in one case:
The committee member should remember that he has an obligation to his divi
sion in that he is their representative. He therefore must be conscientious in his
representation and present fairly and without personal bias the prevailing senti
ment of his division.
He should make sure that he covers his division thoroughly to obtain this pre
vailing sentiment. He should not be influenced by one or two employees into
presenting the opinion of a minority as that of the division, when actually the sum
total of the division, if actually canvassed, may be entirely different.
He should go back to his division, after a committee meeting, and interpret the
results of the meeting to his division conscientiously and thoroughly, without
personal bias.
In contrast to these few instances where representatives were allowed
much time to communicate with employees, there were many in which
the management or at least the supervisors forbade such contacts dur
ing working hours. In one instance, where no provision was made for
regular meetings of employees, the chairman complained at a joint
meeting that the foremen would not allow him to transact companyunion business during working hours. The company replied:
The men employed in our shop have regular duties to perform and therefore if
representatives are permitted to discuss employees’ problems and other matters in
connection with the duties of the employees’ representatives, production will be
retarded, costs increased, and the general discipline of the department destroyed.
These are the only reasons why we think it best to withhold the privilege of
discussing these matters during the regular hours of employment.
The difficulty of handling company-union affairs when no provision
was made for regular meetings at which workers could present their
grievances and when the right of representatives to confer with their
constituents singly or in groups during working hours was not clearly
recognized was emphasized in several instances. A rank-and-file
worker said:
The men don’t take grievances to delegates. They are afraid of being fired.
If two or three men talk, the foreman finds out why.
142
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
Another employee said:
It is very difficult for a worker to get out of the production line in order to talk
to his representative. Of course, it is also very conspicuous. The practice tends
to be frowned upon by foremen and supervisors but it is the only method the
employees have of dealing with their representatives.
Where no regularized basis of contacts during working hours existed
and where regular and frequent membership meetings were not held,
persons interviewed stated that dependence was placed almost entirely
upon informal or chance contacts between representatives and their
constituents. “ During lunch time or going home from work” was a
common statement of how grievances and matters of general policy
were discussed by the employee and his representative.
These difficulties were most pronounced in connection with matters
which affected the group as a whole. In a number of cases, the answer
to the question of how employees discuss their general problems with
their representatives was, “ They don’t.” In several instances the lack
of adequate means by which the representatives could consult their
large constituencies was given as an important reason for the fact that
the company union had become moribund.6
In 76 company unions there had been at least 1 meeting of the em
ployees since its establishment.7 Their frequency and character
differed. Regular meetings of employees were provided for in 47
cases. A monthly interval was the most common, though a few met
more frequently. More than one-third provided for less frequent
meetings, although many of these also provided for special meetings
“ on call.”
Occasional rather than regular meetings were held in 29 instances.
Where no stated intervals for meetings existed, they occurred less
frequently than where regular intervals were provided for.
The practice of company unions with respect to employee meetings 8
is shown in the following list:
Number
o f com
p an y
u n io n s
No meetings________________________________________________
Occasional meetings 1________________________________________
47
29
All regular meetings_________________________________________
47
More than once a month________________________________
M onthly________________________________________________
Less frequent than once a month and more frequent than
once a year___________________________________________
Annually_______________________________________________
5
28
7
7
1In clu d es 2 cases w h ere o n ly 1 m e etin g h a d b een h eld sin ce th e form ation o f th e c o m p a n y u n io n .
8 A lth o u g h large c o n stitu en cies w ere a h in d ran ce to e ffectiv e fu n ctio n in g in so m e cases, th is w a s n o t a
sig n ific a n t factor in th e group as a w h o le. O ther e lem en ts in th e situ a tio n w ere in m o st cases m ore im p o rta n t
th a n th e size of th e c o n stitu en c y . M o re th a n tw o -th ird s o f th e c o m p a n y u n io n s avera ged le ss th a n 100 em
p lo y e e s to a rep resen ta tiv e, a n d in o n e-th ird th e ratio w a s 1 rep resen ta tiv e to e v e r y 50 or le ss w ork ers.
7In tw o in sta n ces o n ly o n e general m e etin g h a d b een h e ld sin ce th e in a u g u ra tio n o f th e c o m p a n y u n io n .
s In c o m p lete in form ation in th ree cases.
E M P L O Y E E M E E T IN G S A N D P A R T IC IP A T I O N
143
Employee meetings were held on company property in the majority
of cases. A substantial number were held in outside halls, churches,
schools, or members, homes.9 Four-fifths of the company unions met
after working hours.10 In all cases in which employee meetings were
held during working hours and in a few of those that met after working
hours, employees were paid their regular wage rate by the company
for time spent at the meeting. One company made such payment only
when the meeting was called at the request of management.11
Employee meetings were held without representatives of manage
ment being present in half the company unions. In another one-third,
representatives of management were permitted to be present only on
CHART 7
FREQUENCY OF GENERAL EMPLOYEE MEETINGS
U S. BUREAU OF LABOR STATISTICS
invitation. In one case a management official was invited to speak
at a series of branch meetings to explain the new agreement signed by
the company and the company union. Management representatives
attended all employee meetings as a matter of course in a number of
instances, including two organizations in which the management staff
was eligible to membership.
In many company unions all employee meetings were open to any
one who might choose to attend. The president of one company
union, addressing a general membership meeting, pointed with pride
9F o r ty -o n e m e t o n an d tw e n ty -fo u r off c o m p a n y p rop erty . T h ree m e t in clu b room s. In o n e case th e
clu b ro o m w a s g iv e n to th e asso cia tio n b y th e co m p a n y . In a n oth er case it w a s o w n ed b y th e c o m p a n y
a n d r en te d b y th e asso cia tio n . In th e th ir d ca se th e ow n ersh ip w a s n o t in d ic a te d . N o in fo rm a tio n a b o u t
p la ce o f m e e tin g w a s o b ta in ed for 8 o f th e 76 c o m p a n y u n io n s w h ic h h a v e h a d m em b ersh ip m eetin g s.
10O n e c o m p a n y u n io n m e t p a r tia lly o n c o m p a n y tim e a n d p a rtia lly after h o u rs, w h ile a n oth er va ried
its m e etin g tim e accord in g to con v en ien ce. E le v e n c o m p a n y u n io n s h eld th eir m eetin g s d u rin g w ork in g
h ou rs.
11T w o p a id for p a rt b u t n o t a ll o f th e tim e sp e n t in m eetin g s. A n o th er g a v e th e w orkers e q u iv a len t tim e
off w ith p a y .
144
CHARACTERISTICS OF COMPANY UNIONS
to the fact that the meeting was open to all and asked “ if the meetings
of the (trade) union were held with an ‘open door’ .” On the other
hand, several organizations adopted a more exclusive attitude. One
company union, engaged in a severe competition with a trade-union,
asked its members to bring their postcard notices to the meeting as
identification and admission cards.
The effectiveness of employee meetings depended upon the charac
ter of the discussions. At a few meetings there were discussions con
cerning wages, hours, and working conditions, and of collective
agreements from which emerged a formulation of employee attitudes
and demands. In others the employees were merely called upon to
ratify a ja il accompli. In one case members met only once a year,
the meeting being called to ratify the agreement with the employer.
Two others held a series of branch meetings to explain a new wage
agreement. In at least a fourth of the cases, the discussion was
confined to production and sales problems, business conditions, social
and recreational activities, and minor grievances.12 Some spent a
large part of their time decrying trade-union practices. The only
employee meeting held by one company union was taken up with
addresses by a company official and by an outsider who also spoke in
the same city under the auspices of the chamber of commerce. The
former discussed the profits and losses of the company; the latter
spoke on education.13
Employees had the right to vote on specified issues in eight in
stances.14 In two company unions strike votes were provided for.
A third required that articles of the wage agreement between the
company and the association must be approved at the annual general
membership meeting. Another .stipulated that all contracts recom
mended by the executive committee must be ratified by a two-thirds
vote of a general membership meeting. One broadened the list of
items to be so voted on:
Any matter of major importance such as the settlement of wage scale and the
number of working hours in any of the various groups shall be voted on by ballot
by members of the association who are to be affected by the action taken before
a conclusive settlement can be made between the company and the association
representative.15
A number of company unions which had no formal requirement
for vote by membership on specified matters did submit certain ques
tions to the membership for decision. In four cases starting and
12
O n e c o m p a n y u n io n p ro v id ed a n e x ten siv e en te r ta in m e n t program for its m em b ersh ip m e etin g .
“ S p o rts” , “ so cia l affairs a n d th e m a n a g em en t o f th e sick -b en efit fu n d ” , “ ch a r ity cases, th e sen d in g o f
flow ers, an d a d iscu ssio n o f fin a n ces” w ere d escrib ed as b ein g all th e su b jects cov ered in m em b ersh ip m eetin g s
in so m e cases.
is T h e c o m p a n y u n io n p a id a $25 h on orariu m to th e sp eak er o u t o f fu n d s o b ta in ed from d u es.
H F iv e w ere p ro v id ed for in th e c o n stitu tio n s an d th ree in ag reem en ts b e tw e e n th e c o m p a n y a n d th e co m
p a n y u n io n .
is N o p erson in terv iew ed in co n n ectio n w ith th is c o m p a n y u n io n w a s aw are th a t su ch a p ro v isio n existed .
EMPLOYEE MEETINGS AND PARTICIPATION
quitting hours were so determined; in two cases, number of hours per
week.
None of the company unions studied, whether holding employee
meetings or not, gave the general membership the power to call for a
referendum on any act of the officers or council.16
Keeping employees informed.— Somewhat different from the task of
ascertaining the wishes and problems of the workers is that of report
ing to them on actions taken by the company-union officials. Where
adequate meetings were held or contacts placed on a regularized basis,
both tasks were performed at the same time. One company union
required its president to submit detailed reports in writing annually
to the members. These reports described all transactions of the
association and the council for the preceding year.
Publication of minutes of council or committee meetings 17 was
another means used to keep employees informed of the actions of
their representatives and officers. Such minutes were read at em
ployee meetings in a number of cases. In about an equal number of
instances the minutes were printed either separately or in a company
or company-union news sheet and distributed to the workers. More
commonly minutes of council meetings were posted on bulletin
boards. In a number of cases minutes were kept in the company office
or in the possession of company-union officers and employees could
see them only on request. The company-union president in one case
reported that minutes of employee-representative meetings and rec
ords of cases were not publicized to all workers because—
We’re not looking for trouble * * *. If they come to us, all right, we take
their cases up * * * but we don’t want the whole plant down on us asking
for the same thing.
Minutes in a number of cases were taken by a management official
or an employee of the company who was not a representative. Con
densation and summarization of the minutes was in several cases
the task of the personnel manager or some other company official.
There was considerable variation in the fullness of the minutes
made available to the employees. In several instances a full sum
mary of the discussion, point by point, was printed in the company
paper or in separate form. In others, the answers made by manage
ment representatives were given in much greater detail than the
demands and arguments of the employee representatives. In one
organization, such reporting caused frequent protest by the em16O ne co n stitu tio n p ro v id ed th a t a n y q u estio n on w h ich th e c o m m ittee cou ld n o t agree b y a tw o -th ird s
v o te sh o u ld b e su b m itte d to v o te o f th e m em b ersh ip . P ro visio n s for recall o f rep resen tatives an d officers
h a v e b een d iscu ssed p r ev io u sly . See ch. X I I , p . 123.
17S o m e co m m ittees k e p t n o m in u tes o f th eir p roceed ings.
146
CHARACTERISTICS OF COMPANY UNIONS
ployee representatives.18 The speeches of management officials on
business conditions and the political situation, which formed an
important part of many committee meetings, were frequently repro
duced in considerable detail while discussion of employee requests
received briefer attention.
Some of the minutes distributed to the employees were merely
brief accounts of issues raised and terse statements regarding the
disposition made of them. Employees interviewed in several cases
commented on the brevity of the minutes and the lack of detail.
One said: “ We don’t see how they spend 3 or 4 hours talking and
have such brief minutes.”
is A n exa m p le o f th is m e th o d follow s: “ T h e cou n cil th ereu p o n en gaged in a v e r y th orou g h d iscu ssion of
th a t su b ject (a req u est for th e 44-hour w e ek an d a 25-percent w a g e in crea se), th e m an a g em en t rep resen tatives
ta k in g th e p o sitio n th a t to c o m p ly w ith th e req u est o f th e e m p lo y ee rep resen ta tiv es a s p resen ted w o u ld
so affect th e b u sin ess of th e c o m p a n y as to serio u sly en d an ger its p rosp ects a n d th a t su ch a co n d itio n , if
b rou g h t a b o u t, w o u ld in ju re e v e r y em p lo y ee. T h e e m p lo y ee rep resen tatives also en gaged in d iscu ssin g
th e q u estio n a n d p resen ted th eir sid e o f th e q u e stio n .”
Chapter X Y
Procedure for Dealing with Employer
The treatment of individual complaints and grievances is generally
considered one of the major functions of company unions. Such
grievances are usually handled through elected departmental repre
sentatives. The procedure is generally based upon the assumption
that injustices or causes of dissatisfaction develop inadvertently,
perhaps even unknown to management, and that equitable adjustment
requires no more than a conference between employer and worker.
Consequently in negotiating individual grievances, many company
unions throw considerable responsibility upon the worker concerned
and upon his representative.
Grievances.— The individual worker was permitted to seek the assist
ance of the company-union mechanism without having made any
attempt to settle the matter directly with the foreman or other com
pany official concerned in nearly three-fifths of the company unions.1
In the remaining cases he was required to try to adjust the matter
with his foreman before turning it over to his representative. In some,
before he could ask action through the company union, he was required
to carry his complaint above the foreman to the division superintend
ent, and in a few instances to the plant manager.
The procedure followed by the employee’s representative after a
grievance was referred to him varied. In about one-third of the com
pany unions the complaint was immediately placed in the hands of a
committee or of some official of the company union specially charged
with the function of negotiating with management.2 The employee
representative in such cases served primarily as a channel through
which complaints came by direct referral from the worker or workers
concerned. Two company unions had a specific provision that, in
any negotiations with management, “ more than one representative
of the council shall, whenever practicable, be present.” A third pro
vided that—
A ll negotiations and conferences with the em ployer m u st be conducted b y the
whole com m ittee or board in a b o d y ; and n ot singly and /or individually.
1O f th e 126 c o m p a n y u n io n s stu d ie d , 4 h a d n o grieva n ce m a ch in e r y o f a n y k in d . D a ta o n grievan ce
p roced u re w ere la ck in g in fiv e cases; in an oth er th e c o m p a n y u n io n w a s still in p rocess o f organ ization .
O f 116 o n w h ic h d a ta w ere av a ila b le, 65 d id n o t req u ire th a t th e w ork er ta k e th e m a tter u p w ith h is forem an
d ir e ctly .
2In e ig h t c o m p a n y u n io n s w h ic h h a d fu ll-tim e p a id officials, th e ta sk of p relim in ary n eg o tia tio n w a s g en
era lly th ro w n u p o n th is official, w ith a ctio n b y th e fu ll co m m itte e o n ly in case h e failed . In o n e su ch organ
iz a tio n , h o w ev er, th e e m p lo y ee rep resen ta tiv e w a s exp ected to h a n d le th e first n eg o tia tio n , tu rn in g th e case
o v er to th e p a id official in case o f failure to a d ju st.
147
148
characteristics of company unions
In about two-thirds of the company unions the employee represen
tative was given the responsibility of seeking personally to adjust the
difficulty with the supervisor involved. Only after he failed could he
turn to some form of group action. One constitution provided that—
E ach departm ent representative is to serve as far as possible to settle all differ
ences arising within his departm ent.
I f this cannot be accom plished, the case
will be referred to the executive council for final ju d gm en t.
A clear statement of the heavy responsibility sometimes placed upon
the individual employee representative in handling individual com
plaints is presented in the following description of the “ Duty of a
representative” found in the employees’ handbook of one company:
I t is the d u ty of a representative to represent, in the em ployees’ congress, the
m en o f his departm ent.
T h is he should do w ithout fear or favor.
I t is the inten
tion of th e m an agem en t th a t he should do this and he will n ot be criticized for
the perform ance o f his fu ll d u ty as a representative.
A n y em ployee having a com plaint which he cannot get a dju sted through his
forem an, has th e privilege of taking it up w ith his representative, who will in turn
bring th e m atter before th e congress.
In handling a grievance he should insist th a t the person having the grievance
appeal first to his forem an.
I f the forem an fails to handle it satisfactorily the
representative should tak e it before the congress.
If, how ever, he think s he can
get a satisfactory ad ju stm en t b y again going to the forem an, or b y going to his
superintendent, or a m em ber o f the industrial relations departm ent, he m a y do so.
Once having agreed to investigate a grievance a representative should never
consider his d u ty done until he returns a definite answer to the person or persons
whom he is representing.
Where the employee representative was individually responsible
for direct negotiations with management, there were differences as re
gards the extent of his responsibility. In one-half the cases, before
turning a complaint over to the committee, he was required to see only
the foreman involved, or in a few cases, and at his own option, the
foreman’s superior or the personnel manager. An equal number,
however, provided that the employee representative should push the
matter beyond the foreman. Some of these required further that he
handle the adjustment through the foreman, the personnel manager,
and the factory manager before presenting the matter to the commit
tee of employee representatives. In a few cases, before turning it
over to the committee, he was required to take the matter through
four separate stages and in a few others through “ each higher ranking
executive officer of the company.”
The study was not directed toward analyzing the relative effective
ness of these methods of handling individual grievances. It is, there
fore, not possible to say, without further investigation, whether direct
or indirect or a combination of direct and indirect methods were most
conducive to effective grievance adjustment.
In this connection it is interesting to note that a majority of the
company unions provided for direct application by the individual
P R O C E D U R E F O R D E A L IN G W I T H E M P L O Y E R
149
to his employee representative without having first taken the matter
up with his foreman, and a similar proportion required the representa
tive to deal directly with the foreman before seeking group aid. It
is of further interest to note that in 32 company unions, about twothirds of the cases where direct negotations between the individual
worker and the foreman were provided, further direct negotiations
between the individual representative and the foreman were required.
Twenty-two consistently followed the opposite policy of indirectness,
both with respect to employees and representatives. On the other
hand, 18 company unions which required direct handling by the worker
did not require such action by the employee representative, while 43
required the representative but not the worker to deal directly with
the foreman.
If the individual worker or representative first attempts a solution,
there is an informal contact of the persons with a first-hand knowledge
of the problem. However, there was evidence, in a number of cases,
of a hesitancy in pushing for adjustments with a foreman under whom
the individual worker or his representative must work from day to day.
Group action or action by a grievance specialist, although making the
adjustment more indirect, relieves the employee or his representative
of certain fears. Furthermore, the use of a grievance specialist or
committee places the different departments on a more even plane than
action by each of the representatives as individuals.
From several company unions in the group which required the
employee representatives to handle grievances directly came reports
of significant differences between employee representatives in the
handling of complaints. Thus an employee representative in one
plant stated that effectiveness depended upon the individual repre
sentative. “ If he is willing to talk and fight, things are done, but
not otherwise.” A rank-and-file worker in another case said: “ The
plan works fairly well if the councilman is good. If not, it doesn't
work at all.” In a third case, a rank-and-file worker said: “ We are
the best-represented district in the plant because our representative
(a trade-union official) knows a bit more about bargaining than the
rest do. Besides, he has no fear of losing his job, since he has another
offer elsewhere.”
The committee could proceed in a number of different ways after a
grievance was called to its attention. Some referred the matter to a
standing grievance subcommittee for investigation and report.3
Others heard the matter before the full committee. The task of pre
senting the employee's case before the committee was frequently
entrusted to his employee representative although the employee con
cerned was sometimes permitted to state his own case. Sometimes
3 S o m etim es th e grieva n ce c o m m itte e a ttem p te d to se ttle grievan ces before th e y w ere b rou g h t before th e
fu ll co m m ittee. In so m e oth ers, after th e fu ll co m m itte e h a d d ecid ed o n th e reco m m en d a tio n of th e g riev
an ce c o m m itte e , th e la tter c o m m itte e c o n d u cted th e ap p rop riate n eg o tia tio n s w ith m an a gem en t.
150
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
he was given the right to call other employees as witnesses before the
committee.4 Others gave the council the right, by majority vote, to
call witnesses.
W ages , hours, and working conditions.— The great majority of con
stitutions specifically or by implication indicated that general ques
tions of wages, hours, and working conditions were to be handled in a
manner different from that prescribed for individual grievances. They
usually provided that negotiations concerning wages, hours, or other
general questions be started by the committee, omitting all the stages
of negotiation in which the individual employee and the individual
employee representative are involved.
In a few company unions wage and hour questions had to be sub
mitted to a special committee for investigation before they could be
considered at the joint conferences. In one organization with both
an employee committee and a joint committee, the employee commit
tee took no part in handling such matters, which proceeded imme
diately to the joint committee. Generally, however, after such general
questions were referred to the committee, the procedure was the same
as that which applied to the handling of individual grievances.
General questions or complaints involving more than one worker
received no mention, however, in a number of constitutions.5 The
constitution in such instances spoke only of “ an employee, having a
complaint” or of “ any employee having a complaint, regarding work,
prices, or anything pertaining to his or her employment.” There was
no reference to any procedure for handling questions affecting groups
of workers.
A ppeals .— Most of the company unions studied provided for one or
more appeal stages in the handling of grievances and other matters,
once they reached the committee. The procedure depended to some
extent upon the internal organization of the company, as well as the
area covered by the company union. Thus a company union in a
public utility operating in a great many places scattered over a large
area would have a more elaborate hierarchy of committees and appeals
than a company union functioning in a small shop with a more or less
homogeneous group of workers. In some cases the evidence suggested
the complete absence of any careful consideration of procedures for
adjustment.
It is impossible to classify the variety of arrangements utilized for
the review of grievances, after those grievances have reached the com
mittee stage of dealing. In some, the first and only appeal from the
joint committee was to outside arbitration.6 In others, appeal was
from the division or departmental joint committee to a higher joint
4O n e c o m p a n y u n io n h a d a p ro v isio n for an em p lo y ee a tto r n ey an d a m an a g em en t a tto r n ey , an d o u t
lin e d in d e ta il a proced u re sim ila r to a cou rt trial.
5T h is w a s tru e in 14 c o n stitu tio n s.
6In p ractice, o u tsid e arb itratio n w a s n o t resorted to b y a n y of th ese co m p a n y u n io n s. See ch . X V I.
PROCEDURE FOR DEALING WITH EMPLOYER
151
committee. In still others, dissatisfied employee representatives
might appeal from the highest joint board to an official of the com
pany. In the employee-committee type, as a rule, appeal was from
one company official to another.
Eleven company unions provided joint boards of appeal which
were regularly elected or appointed. Such boards were rarely if
ever used.7 In three company unions arrangement was made for
setting up a special ad hoc board, made up of persons within the com
pany, for adjustment of particularly difficult matters.8 Two of these
were in public-utility companies. The board consisted of three
representatives from management and three from the employees.
Decision was by majority vote. While no specific provision was
made for cases in which a decision was not reached, the constitution
recognized the possibility of appeal to the National Labor Relations
Board or to some other Government board by providing that, in case
of such an appeal, the evidence and findings of the joint board should
be certified to the outside board. A third provided that, in case a
matter could not be settled by unanimous vote of the management
and employees’ executive committee, the general employees’ com
mittee should elect five members and management should appoint
an equal number to an arbitration board. A majority decision of
this arbitration board was binding upon both the company and the
employees. If a majority could not agree within 10 days after their
selection, an additional member “ mutually agreed upon by the com
pany-union chairman and the president of the company” could be
added. The decision of a majority of such “ members shall be binding
upon both the company and the employees respecting all matters
referred to such arbitration.”
In some cases “ more important matters” such as wages and hours
could be appealed to an official or officials of a higher rank than the
person having final authority over individual grievances. One
company union provided that important matters be taken up directly
with the president of the company, less important matters with the
vice president. Another provided that a matter affecting a particular
business unit only could not be appealed beyond the company-union
committee for that unit:
T h e departm ent councils shall have auth ority to negotiate, bargain, and agree
upon a n y such m atters specifically and exclusively relating to its departm ent.
M a tters which fall outside the scope of the departm ent shall be referred to the
division council.
M a tters pertaining directly and only to m em bers in a depart-
7O n e p ro v id ed th a t fin al a n d b in d in g d ecision sh o u ld rest w ith a sta n d in g b oard com p o sed o f tw o e m
p lo y er m em b ers ap p o in ted b y m an a g em en t, tw o e m p lo y ee m em b ers elected b y th e em p lo y ee rep resen tatives
fro m am o n g th e h o u rly ra ted em p lo y ee s, an d a fifth person elected b y th ese four from a m o n g th e h o u rly
r a ted e m p lo y ees. T h e em p lo y ee s th u s h a d th ree o f th e fiv e rep resen tatives. T h is b oard acted o n ly on ce
in 17 years, d ecid in g in favor o f th e em p lo y ee.
8S u c h a board m u st b e d istin g u ish e d from o u tsid e arb itration , alth o u g h in on e case it w as a p relim in ary
ste p to arbitration.
152
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
m en t shall be dealt w ith and determined b y the departm ent council rather than
b y reference to the division or general council.
The difference in procedure for various types of subjects becomes
very distinct in the following:
W h e n th e (joint) conference board reaches an agreem ent on m atters other than
those declared b y the chairm an (a com p an y official) to be m atters affecting m ajor
com p an y policies, this decision shall be final.
W h e n th e conference board reaches an agreem ent and m akes a recom m enda
tion on m atters affecting m ajor com p an y policies, the acceptance or rejection
of their recom m endation shall rest with the m anagem ent.
In about 20 percent of the company unions studied, the company
officials possessing final authority were not directly connected with
the particular plant concerned.9 Conferences were held between
employee representatives and branch-management representatives on
important matters. The requests and arguments were then trans
mitted to the main office by the branch manager or personnel director.
Thus the company-union representatives never came in direct con
tact with the person who had final authority. The following incident
illustrates the procedure in one of these cases:
T h e chairman of the em ployees’ com m ittee stated in the jo in t-com m ittee m eet
ing th at he had received a petition, signed b y a m ajority of the em ployees, request
ing th a t the com pany be asked to m ake a uniform wage increase of 15 cents per
hour to all em ployees and th at the general (em ployees’) com m ittee had approved
submission of this request to m anagem ent.
T h e plan t superintendent said th e
m atter w ould be presented to the president of the com pany in Chicago.
A t th e
follow ing m eeting, a lengthy letter was read from the president explaining w hy
th e increase could n ot be gran ted.10
Although most of the company unions provided for appeals through
various stages up to the top management, very few requests were
taken from lower to higher officials.11 The failure of some company
unions was attributable to management’s refusal to let grievances get
past the plant manager. The attitude of one management official on
an appeal submitted in accordance with the company-union rules was
such as to discourage any repetition of an appeal.
T h e vice president stated th a t he th ou gh t it unreasonable to bring this case to
him after the m anager and his assistants had gone over it so thoroughly
*
*
*
he could n ot see any reason w h y he should reverse the decision of the m anager.
Workers’ representatives in some cases showed a hesitancy about
requesting an appeal. A typical statement from employee representa
tives was: “ We can appeal to the president but we never have.” A
works manager said:
• T h is is, o f course, ap art from th e fact th a t in m a n y cases m a tters of broad p o licy w ere se ttle d b y officials
in p a ren t com p a n ies.
10S ee also p . 176.
n F o r exa m p le, in 1 c o m p a n y u n io n , of 165 m a tters acted on in 20 m o n th s o n ly 4 w ere ap p ea led .
P R O C E D U R E F O R D E A L IN G W I T H E M P L O Y E R
153
T h ey can appeal from m e to the president and then to the board of directors.
T h ey never have.
T h ey are reasonable.
I f I say it can’t be done, they abandon
it.
The attitude of some representatives toward appeals is indicated
by the following statement made by an employee representative:
T h is spring we w anted another 10-percent raise and no decision was reached.
T h e com p an y agreed we ought to h ave m ore b u t the com p any couldn’t stand it.
T h is is the only tim e the assem bly didn’t finally reach an agreem ent.
T he m en in
the shop were critical, b u t any one of them or a group could h ave petitioned for
and g o t an appeal to the appeals com m ittee.
I , as representative, didn’t think it
was m y place to tak e the appeal, having voted for the increase.
In one instance in which votes in the joint committee were divided,
one employee representative said:
W e w anted to refer the m atter to the appeals com m ittee bu t the chairm an was
scared o f his job and we w ho w anted to thou gh t th at there was no use three or four
pushing it if the em ployees weren’t united.
1 54 8 7 5°— 38-
11
Chapter X Y I
Collective Agreements, Arbitration, and Strikes
Collective agreements are the outgrowth of negotiation between
employers and organizations of workers. They usually record
agreements with reference to wages, hours, and working conditions
and may also provide a procedural framework for future dealings.
As has already been noted, there has been a tendency in company
unions to embody the procedural details of employer-employee dealings
in the constitution of the company union itself. In a number of com
panies some of the persons interviewed considered the constitution of
the company union a joint agreement, even though it was not drawn up
in that form. In several companies, management said that written
agreements were unnecessary. “ Our word and that of our employees
has always been good.” “ An agreement doesn’t mean anything if the
spirit is not there.” “ It is a policy of the company not to sign agree
ments.” 1
Less than one-fifth had some kind of bilateral agreement.2 Nine of
these 22 agreements were merely acceptances by management of pro
cedural practices.3 In some instances the entire constitution was in
the form of a joint agreement. In others, only those procedural
arrangements dealing with management’s responsibilities were covered
in the agreement.
i F o u r co m p a n ies w h ic h h a d n o w r itte n a g reem en ts w ith th e c o m p a n y u n io n h a d su c h a g reem en ts w ith
o u tsid e tra d e-u n io n s co v erin g on e or m ore crafts in th eir p la n ts. S o m e of th ese ag reem en ts w ith tra d e-u n io n s
p rov id ed for a closed sh o p for th e occu p a tio n s covered .
3S u ch a g reem en ts w ere rep orted in 23 o u t o f th e 126 cases. O ne c o m p a n y refu sed to fu rn ish a c o p y of th e
agreem en t to th e B u r e a u an d it w a s, th erefore, im p o ssib le to d eterm in e its form or co n te n t. I n o n e case th e
c o m p a n y refu sed to sig n th e a g reem en t b u t p ro m ised to p u t it in to effect. I t w a s gen era lly a ccep ted as a
b in d in g ag reem en t an d is so con sid ered here.
T h ree c o m p a n y u n io n s w ere rep orted to b e in th e p rocess of n eg o tia tin g a n a g reem en t. T w o h a d ob ta in ed
u n ila tera l sta tem e n ts o f p o lic y from th e e m p lo y er . O n e of th e u n ila tera 1sta tem e n ts w a s a p r in te d ‘ ‘program
o f e m p lo y m e n t r ela tio n sh ip ’’ w ork ed o u t in c o n su lta tio n w ith th e c o m p a n y u n io n . T h e p rogram w e n t in to
con sid erab le d e ta il as to h o u rs, w o rk in g c o n d itio n s, h irin g , d isch a rg e, an d o th er m a tte r s, b u t th e se c tio n on
w a g es sim p ly p ro v id ed th a t a t le a st th e cod e m in im u m w o u ld b e p a id a n d th a t p iece rates w o u ld b e se t on
th e b a sis o f tim e stu d y . T h e u n ila tera l sta te m e n t b y a secon d c o m p a n y m erely ap p ro v ed th e prop osed
rev ised co m p a n y -u n io n p la n an d se t forth a general p roced u re for n eg o tia tio n , in c lu d in g a lim ita tio n of th e
su b jects to b e su b m itte d to n e g o tia tio n a n d a rb itratio n . (S ee a p p en d ix I I I , p . 278.)
3T h u s in th ree cases th e c o n stitu tio n w a s in th e form of a jo in t ag reem en t. A n o th er w a s co n fin ed to an
ag reem en t w ith resp ect to th e d u ra tio n o f th e c o m p a n y u n io n . F iv e o th ers, a ll first sig n ed sin ce M a rch 1933,
sim p ly p r o v id ed m e th o d s o f proced u re an d n e g o tia tio n , m a tte r s w h ic h before N . R . A . w ere p a rt of th e co n
stitu tio n or b y la w s o f th e c o m p a n y u n io n . S u ch ag reem en ts m a y b e com p a red to reco g n itio n a g reem en ts
w ith tra d e-u n io n s. T h e y p ro v id e a b a sis for reg u latin g w ag es, hours, an d w ork in g co n d itio n s b u t d o n o t
a c tu a lly u n d erta k e su c h reg u lation .
C o m p a n y u n io n s in tw o su b sid ia ries of th e sa m e c o m p a n y h a d v e r y sim ila r c o n stitu tio n s, b u t on e w a s
d raw n u p as a n a g reem en t an d th e oth er w a s n o t,
154
C O L L E C T IV E A G R E E M E N T S , A R B I T R A T I O N , A N D S T R IK E S
IQ Q
Thirteen bilateral agreements contained provisions regarding wages,
hours, or working conditions, with or without additional provisions
regarding negotiating machinery. Six of these were more or less
complete agreements patterned along trade-union lines. Thus one
agreement provided the following: Specific wage rates and hours of
work for particular occupations; seniority in promotions “ whenever
men capable of filling the vacancy are available” and in lay-offs;
1 week’s notice of lay-off; 1 week’s vacation with pay; 1 week’s sick
leave with pay; consultation with the company union in case of reor
ganization of any unit; appeals machinery on dismissals; and machin
ery for the adjustment of disputes. The other seven covered only a
few matters or were otherwise incomplete and indefinite. One covered
wage rates and seniority rules only. Another gave wage rates only,
with no provision for expiration or revision. In some agreements,
wages-and-hours provisions were stated in general terms only or refer
ence was simply made to code provisions.4 Two provided specific
regulation of particular questions of working conditions.5
The conditions surrounding the granting of the 13 wage agreements
are of some interest. Two agreements which dated from before 1933
were with company unions organized during a strike. The first ran
for 10 years, with rates subject to revision every 6 months, if requested.6
The second pre-N. ft. A. agreement was for 1 year and had been
renewed annually for over 10 years.
Two agreements were in company unions established before 1933,
which had never entered into such agreements before the N. It. A.
In neither was trade-unionism a serious problem. Adoption of the
written agreement in these two companies was largely a response to
N. It. A. and to the feeling that written agreements were more con
ducive to clear understanding of what had been decided upon.
Nine of the thirteen agreements were among the 90 company unions
first organized under the N. I. It. A. The activity of a trade-union was
a factor in almost all of these cases.7 In two the organizations had
* “ R a tes in force’’ w ere co n tin u ed u n d er on e agreem en t. C od e w ages an d h ours w ere to go vern u n d er
a n oth er b u t in th is case, as in on e oth er, w ag e rates w ere to b e reclassified. In tw o oth er cases th e o v ertim e
p ro v isio n w a s ta k e n from th e code.
6 O n e o f th ese form ed p a rt of a series o f su ch regu lation s w h ic h w ere b ein g w ork ed o u t b y jo in t actio n of th e
c o m p a n y a n d th e c o m p a n y u n io n .
6W ag e ra tes w ere to b e b a sed o n th e scale b ein g p a id for sim ila r w ork b y th e m ajo rity of em p lo y ers in th e
d istrict. I n case o f th e ab sen ce o f a general w a g e le v e l or in case o f a strik e, co st o f liv in g w a s to b e u se d as
th e b a sis. T h e c o m p a n y w a s in a n in d u str y w h ic h w a s str o n g ly u n io n ized . T h u s th e co m p a n y -u n io n w ag e
rate w a s in d ir e ctly d eterm in ed b y th e tra d e-u n io n rate.
7 I n o n ly o n e w a s a tra d e-u n io n n o t a n im p o r ta n t factor.
In th is case th e sa m e k in d o f ag reem en t w as
m a d e a s h a d b een in effect before N . R . A . w ith an oth er c o m p a n y u n io n in th e sa m e c o m p a n y .
156
C H A R A C T E R IS T IC S OP C O M P A N Y U N IO N S
not met or functioned since the agreement was effected.8 One em
ployee representative said:
T h e plan is n ot now in operation.
I t was started to prevent the trade-union
getting strength and to do our own bargaining.
Two companies refused an agreement to the trade-union but
promised one to the company union as an inducement for organiza
tion. In another, the company refused to renew a trade-union agree
ment, which had covered all the workers, on the ground that the tradeunion had not obtained a clear majority of the votes in an election
conducted by the Kegional Labor Board.9 A written agreement was
granted to the company union covering its members, but the tradeunion refused a similar agreement covering its members alone. In
another, an agreement was entered into with a bargaining agency set
up by a governmental board, but since the trade-union representatives
had withdrawn from the agency, it became in effect solely a companyunion organization.
In addition to these written agreements there was one case in which
the management representative said the minutes were considered the
“ written law” governing employer-employee relations. The minutes
in question were full and contained discussions and results of negotia
tions, including wages. They were mimeographed for distribution to
all employees. One company had posted an “ agreement” which any
individual might sign. It made no reference to the company union.
Another had signed individual agreements with employees in one
key unit.
Three company unions had a provision in the constitution giving
them power to negotiate agreements with management, but none was
entered into. Two others had asked for written agreements which
management had refused.
Arbitration
In 40 percent of the cases studied 10joint agreements or constitutions
provided for arbitration or recourse to some external agency. Thus
differences between management and employees could be submitted to
a disinterested agency for solution.
Among company unions having the right to arbitrate, one-half had
8 N e ith e r o f th ese ag reem en ts h a d a d efin ite term or p ro v isio n for ren ew al; o n e co v ered w a g es o n ly .
In a n o th er case, th e c o m p a n y sig n ed a n agreem en t w ith a h a stily e sta b lish ed b arg ain in g c o m m itte e
co m p o sed o f forem en. H o w ev er , sh o r tly th ereafter th e w ork ers w e n t o n strik e a n d o b ta in ed a n e w agree
m e n t b etw een th e c o m p a n y a n d a co m m itte e o f e m p lo y ees rep resen tin g w orkers organized in th e tradeu n io n .
8T h e tra d e-u n io n o b ta in ed m ore v o te s th a n th e c o m p a n y u n io n b u t n o t a m a jo rity o f a ll th e v o te s cast.
F or fu rth er d eta ils see ap p en d ix I I , p . 267.
10 S u ch p r o v isio n s ap p ea red in 51 o u t o f 126 cases. T w o o f th ese c o n stitu tio n s d id n o t gran t th e rig h t o f
ex tern a l a p p ea l d ir e ctly b u t c o n te m p la ted su c h a p o ssib ility in d ir e ctly . S ee p . 151.
T h is d o es n o t in c lu d e co n stitu tio n s w h ic h lim ite d th e rig h t o f arb itratio n to cases of alleg ed d iscrim in a tio n
a g a in st e m p lo y ee r ep resen tatives. F o r d iscu ssion o f su c h p ro v isio n s, see ch . X I I , p . 128.
COLLECTIVE AGREEMENTS, ARBITRATION, AND STRIKES
^57
an unequivocal provision that unsettled matters coming within the
jurisdiction of the company union should be submitted to arbitration
or that the employee representatives acting alone had the right to de
mand arbitration.11 In one-third, arbitration could be invoked only by
mutual agreement of management and a majority of the employee
representatives, or by a two-thirds vote of a joint council on which
management had equal voting strength with employees. In the other
cases the arbitration clause contained a general statement that arbi
tration might be invoked but outlined no procedure.12
Various methods of setting up arbitration boards were provided.
The most usual arrangement was a one-man or three-man board
selected in accordance with the following common provision:13
(the two parties) shall immediately proceed to select an impartial and disin
terested arbitrator.
If they cannot mutually agree upon an arbitrator, then the representatives of
the (company union) shall choose one such arbitrator and the (management)
shall choose another, and if these two agree, their decision shall be final. If they
do not agree, they shall select and call in a third impartial and disinterested
arbitrator, and a decision of the majority of these three shall be final.
A few constitutions called for the addition of an impartial arbitrator
to an existing joint body of employee and management representa
tives.14 A majority of the augmented body had the power of final
and binding decision. Some provided for submission to the National
Labor Relations Board, the Department of Labor, or some “ duly
constituted labor board or tribunal.” One constitution provided
that, in case the parties could not agree on the method of arbitration,
the matter should be settled by the arbitration committee of the
State chamber of commerce. Where parties could not agree on an
arbitrator within a certain period of time, provision was sometimes
made for appointment of the arbitrator by a Federal judge or some
other Government official or agency. A number gave no details as
to procedure or simply provided that the matter be referred “ to an
arbitrator or arbitrators, to be determined at the time according to
the nature of the controversy.”
Only a few of the constitutions or agreements stated how the
expenses of arbitration were to be met. In six cases provision was
made for the company to bear the expenses, while in four others
expenses were to be shared jointly by the company and the company
union.
Two recent tendencies with regard to arbitration provisions may be
noted. Since March 1933 a number of constitutional revisions pro11 T w o o f th ese 25 com p a n ies restricted th e m a tters th e y w o u ld arb itrate to w ages, or w ag es a n d hours;
w h ile a th ird ex em p ted from arb itratio n “ m a tters b rou g h t before th e jo in t co u n cil w h ic h are n o t le g a l” ,
an d “ m a tters affectin g th e m ajo rity o f th e em p lo y ees a n d th e e m p lo y ee s’ co u n cil is u n a b le to p ro v e th e y
rep resen t th e desires o f a m ajo rity o f th e e m p lo y ees in th e m a tte r .”
12 O n e o f th ese sp ecifica lly con fin ed a rb itratio n to a lim ite d sp h ere n o t in c lu d in g d ischarges.
13 F iftee n c o n stitu tio n s p ro v id ed for a th ree-m a n arb itratio n b o ard , a n d four for a fiv e-m a n board.
14 S ee ch . X V for d escrip tio n o f su ch jo in t b od ies.
158
CHARACTERISTICS OF COMPANY UNIONS
vided for arbitration where none had existed before.16 In others
existing provisions were strengthened.16 A second tendency has
been to insert arbitration provisions, mandatory in character, in the
bilateral agreement or in the unilateral statement of policy by the
company rather than to include them in constitutions.17
In about 60 percent of the cases 18 there was no specific provision
for arbitration. In four of these cases, however, employee repre
sentatives claimed the right to take any unsatisfactory decision to the
National Labor Relations Board or to some other outside agency, even
though the constitution did not provide for such action. Another
provided in its constitution that—
When * * * it is deemed impossible to arrive at a collective agreement by
joint conference on any one issue, the management and the employees are at
liberty to take such action outside of the plan as they may think desirable. But
such action shall not of itself terminate the general use of the plan.
Four other companies stated that they would probably agree to
arbitration if the men demanded it. A fifth company union had an
understanding that arbitration would be granted, while another had
an oral promise to that effect made at the time the company union was
formed.19
In a few cases, arbitration was still an issue. In one, management
was opposing arbitration on the ground that it would involve con
siderable cost and would be an unfair financial burden on the workers
not affected by that particular dispute. In two cases employees had
apparently voted against including an arbitration clause.
One proposed constitution set out to explain the omission of arbitra
tion machinery by the following clause:
The employee representatives and the plant committee as a whole consist of
men and women familiar with the departmental and plant conditions and men
and women who have been sufficiently long in the employ of t h e ----------Company
to understand the interests and the rights of both the employees and the company.
In view of this fact, it is believed that all matters which may arise should be cap
able of satisfactory adjustment by conference and bargaining between such
representatives and the company. Therefore, no further machinery is provided
for the adjustment of such possible differences.
i5
T h ere w a s n o d istin c t ten d e n c y , in th e group stu d ie d , tow a rd m ore freq u en t p ro v isio n for arb itratio n
in c o m p a n y u n io n s esta b lish ed after M a rch 1933. O f th e 51 c o m p a n y u n io n s stu d ie d h a v in g arb itration
p rov ision s, 40 w ere organ ized sin c e 1933, 3 d u rin g th e w a r p eriod , 4 d u rin g th e p o st-w ar p eriod , 3 du rin g
th e period 1923 to 1929, a n d 1 d u rin g th e e a rly d ep ression period (1930-32). E v id en ce o f a slig h t ten d e n c y
to w a rd arb itratio n p ro v isio n s is, h o w ev er, fou n d in th e resu lts o f th e m ore in c lu siv e q u a n tita tiv e stu d y .
See p t. II, p . 68.
is F o u r c o m p a n y u n io n s a d d ed arb itratio n p rov ision s after M a rch 1933. T h ree oth ers ch an g ed from
o p tio n a l to m a n d a to ry arb itratio n .
i7 O f th e 51 arb itratio n p ro v isio n s, 35 ap p eared o n ly in th e c o n stitu tio n , 9 o n ly in th e ag reem en t, a n d 7
in b o th th e co n stitu tio n a n d th e ag reem en t. In th e la st group o f cases, th e p ro v isio n first ap p eared in th e
c o n stitu tio n a n d w a s la ter in corp ora ted in a n ag reem en t. O f th e 16 arb itratio n p rov ision s in ag reem en ts,
all b u t 2 w ere d a te d after M a rch 1933.
i s T h is w a s tru e in 75 o u t o f th e 126 c o m p a n y u n io n s.
is T h e p erson n el m an a ger in th is in sta n c e , h o w ev er, sa id th a t alth o u g h h e h a d orig in a lly reco m m en d ed
a rb itratio n , h e n o w felt th a t it h a d seriou s d raw b a ck s a n d th a t th e co m p a n y w o u ld p r o b a b ly h ed ge o n carry
in g o u t an arb itratio n d ecision w h ic h it b e lie v e d q u ite u n ju st.
COLLECTIVE AGREEMENTS, ARBITRATION, AND STRIKES
^59
This clause was eliminated in the constitution finally adopted
but no provision for arbitration was included.
Despite the more or less elaborate provisions for arbitration in 51
constitutions or agreements, no issue was ever submitted to arbitra
tion.20 Indeed, in only one instance was arbitration requested by
any of the company unions studied. This was true despite the fact
that many of these company unions, in a few cases after a long cam
paign, had failed to obtain favorable action on their requests for
changed conditions.
This failure to use arbitration machinery may be due to a number
of factors. In a few instances management made unusual attempts
to settle disagreements without going to arbitration.21 In some
instances the company union limited its requests to what the com
pany would readily grant. The president of one company union
stated: “ Our recommendation is always accepted by management.
We don’t ask the unreasonable.” 22 One of the most independent
company unions withdrew its request for arbitration for fear it would
endanger the good feeling existing between the company and the
organization.23 Some employee representatives expressed the belief
that nothing could be obtained through external agencies which would
not be granted by the company itself. In three cases all the persons
interviewed were unaware that the constitution provided for arbi
tration.
Strikes
The possible value of arbitration provisions to the company-union
is emphasized by the fact that almost all company-union constitutions
ignore the possibility of a strike by the workers as a means of en
forcing their demands.
The general attitude of company unions toward the strike is exem
plified by the following quotation from a letter from a companyunion committee: 24
20 In th ree cases in w h ic h no arb itratio n m a ch in ery w a s p ro v id ed m a tters w ere su b m itte d b y th e co m p a n y
u n io n s to d ecisio n b y a n o u tsid e a g en cy . O n e case in v o lv e d tw o e m p lo y ee s w h o cla im ed th e y w ere e n title d
to a w e e k ’s v a c a tio n u n d er th e arran g em en t g ra n tin g su ch v a c a tio n to w ork ers e m p lo y ed 5 y ea rs or m ore.
O n ap p eal, a G o v ern m en t con ciliator ru led ag a in st th em . In th e oth er cases, th e c o m p a n y u n io n to o k a
charge o f co d e v io la tio n to th e R eg io n a l L a b or B o ard .
21 T h e jo in t b oard of o n e c o m p a n y u n io n w a s on ce d ead lo ck ed on th e q u e stio n of r ed u cin g a certain ty p e
o f w o rk , b u t in order to m a in ta in th e c o m p a n y ’s record of se ttle m e n t w ith o u t recourse to a rb itratio n th e
p resid en t of th e c o m p a n y b rok e th e d ead lo ck b y v o tin g w ith th e em p lo y ees.
22 T h e e x ten t to w h ic h c o m p a n y u n io n s a c tiv e ly p ress m a tters in v o lv in g fu n d a m e n ta l issu es is in d ica ted
in th e d iscu ssio n in ch s. X V I I a n d X V I I I .
23 A req u est for a w a g e in crease h a d b een refu sed b y m a n a g em en t. T h e em p lo y ee rep resen ta tiv es d ecid ed
to req u est a rb itratio n . M a n a g e m e n t exp ressed its op p o sitio n to su c h a course. A fter con sid erab le d iscu s
sio n th e e m p lo y ee rep resen a tiv es d ecid ed to d rop th e req u est for a w ag e in crease rath er th a n in sist u p o n
a rb itratio n in th e face o f th e c o m p a n y ’s o p p o sitio n . T w o reason s for th is course w ere g iv e n b y e m p lo y ee
rep resen ta tiv es in ter v iew e d . A rb itra tio n w o u ld serio u sly en d an g er th e good r ela tio n sh ip esta b lish ed
w ith th e co m p a n y , an d “ A n arbitrator could h a rd ly b e exp ected to grant an increase w h e n our w ag es are
a b o v e th e co d e.”
24 T h e letter accom p a n ied a prop osed agreem en t, sig n ed b y th e c o m m ittee w h ich th e w orkers su b seq u en tly
rep u d iated .
160
CHARACTERISTICS OF COMPANY UNIONS
We feel that your shop union has won a great victory for you and we strongly
urge every fellow worker to give it his full support. We have been able to win
for our workers substantial increases without resorting to strike and violence.
This has been accomplished by peaceful negotiations. Compare this with
methods used by professional agitators.
A letter from another company union to the employees stated:
Our job is to bargain and adjust complaints without strikes, trouble, and with
out loss of employment.
An agreement signed by one of the most independent company
unions with the employer stated that it was being entered into for
the purpose, among others, of “ preventing lock-outs, walk-outs,
strikes, boycotts, and all other forms of employer-employee discord.”
One company union official, while maintaining the right to strike,
said in a circular:
The final recourse we, as employees, have is to strike. Membership in the
trade-union or the company union does not change this. Certainly we want
no strike, and I believe Mr. General Manager will play fair with us in the future
as he has in the past. A strike would make us lose wages and the company lose
production. It would put them in wrong with their customers and mean a loss
of business, which would mean that when the difficulty is straightened out there
would be less jobs and some of us would be out of luck.
In six instances the strike was mentioned in terms of a restriction
upon its use, but with no statement of any conditions under which it
might be invoked. The restrictions were those which are customary
under joint agreements. Thus two provided that there could be
no strike or lock-out before arbitration had been tried or pending
the rendering of a decision of the arbitration board. Another pro
vided that there could be no strike or lock-out “ prior to, pending, or
following the award of the arbitrators.” Three, bound themselves
in their agreements not to strike or engage in like activities during
the term of the agreement.25
Only two company unions made specific provision for a strike vote
in their constitutions. In one of these cases the strike clause was
inserted during a strike called by a trade-union.26 The clause pro
vided that no strike could be called except on vote of two-thirds of
all members of the company union at a special election called for that
purpose. The second company union required a three-fourths major
ity to call, and a simple majority to terminate, a strike.
Two company unions reported that they had engaged in strikes.27
One was a 1-day protest strike against a Regional Labor Board ruling
ordering the reinstatement of certain dismissed trade-union members.
25 O ne of th ese agreem en ts ran for 10 years.
26 T h e first co n stitu tio n w a s a d o p ted in J u n e 1933 a n d d id n o t co n ta in a strik e clau se. S u c h a clau se
w a s in serted in a rev isio n a d o p ted in A u g u st 1934 d u rin g a strik e.
27 In o n e, all o f th e w ork ers in th e p la n t w e n t o u t o n strik e in 1926 on th e order of th e c o m p a n y u n io n .
F u rth er d eta ils regarding th e strik e are n o t a v a ila b le. In th e sa m e c o m p a n y v a g u e strik e th re a ts w ere
m a d e d u rin g w a g e n eg o tia tio n s in 1934; th e rep resen ta tiv es h a d d iscou raged su c h a c tio n a n d , a ccord in g to
on e rep resen ta tiv e, th e m en w ere h o ld in g th e m resp on sib le for failure to secu re a n increase.
COLLECTIVE AGREEMENTS, ARBITRATION, AND STRIKES
Jgl
A worker in this company said: “ The superintendent told the workers
it would be a good time to show their strength.”
Open or veiled threats of strikes were reported in six cases. When
one company union was first organized the workers by a threat of a
strike secured a wage increase. Subsequently the company changed
the arrangements for membership meetings, forbidding meetings or
the transaction of company-union business during lunch hour. This
practically severed the contacts between the representatives and the
workers, and there were no further threats of strikes. Employee
representatives in another company union voted to call a strike
unless a discharged worker was reinstated. The worker was reinstated
the next day. In another instance strike threats were made in the
course of wage negotiations.28 Threats that “ the workers will take
the matter out of our hands” were voiced by employee representatives
during wage negotiations in another instance. The president of one
company union stated that he believed the men would go on strike
if wages were cut or a militant employee representative discharged.
One management official stated that, although no arbitration pro
vision existed with respect to his company union, he believed that the
workers would strike if he refused to submit an unsettled dispute to
arbitration.
The minutes of meetings, constitutions, and interviews revealed
no instance in which the organization had given any consideration to
the building up of a strike fund to be used in case a strike should be
considered desirable.29 Hardly any of the company unions had funds
sufficient to carry a strike for any length of time. Said the secretary
of one company union:
Of course, no company union is really independent. I don’t know what we
would do if a really crucial matter came up. We might strike but we haven’t
funds.
28 It is n o t clear th a t th e strik e th rea t, w h ic h w a s consid ered a b lu ff b y m a n y o f th e person s in terv iew ed ,
h ad m u ch if a n y th in g to d o w ith th e o u tco m e, w h ic h w as a tem p o ra ry w ag e increase.
29 F or th e in clu siv en ess of th ese m in u tes, see ap p en d ix V , p. 288, footn ote 7.
Chapter X V II
Matters Discussed or Negotiated
The final and real test of an institution lies in its actual accomplish
ments. No analysis of forms, structures, and procedures can be as
significant as an analysis of the results achieved. This study of com
pany unions was made in a period of industrial recovery and aggressive
trade-unionism. The accomplishments of the company unions must
be evaluated against this general background.
The range and number of subjects taken up with management indi
cate the vitality of company unions and the conception which their
members and officials have of the scope of the activity of such organi
zations. Expressions of opinion from a variety of groups also give
some measure of the prestige which the company union has achieved
and how effective the persons concerned think this type of organiza
tion has been. Furthermore, the data gathered permit a judgment
of the extent to which, in form and even in most cases in substance,
the dealings between management and the company union approached
the process of collective bargaining.
There was a wide variation in the extent to which particular matters
were discussed and negotiated by company unions studied.1 Griev
ances of individual employees were treated by 70 percent of the
company unions. Complaints or suggestions involving the safety
1
N o in form ation as to m a tters n eg o tia ted w a s ob ta in ed w ith resp ect to four c o m p a n y u n io n s, b u t in a t
lea st th ree o f th ese cases all in d ic a tio n s su g g ested th a t th e c o m p a n y u n io n h a d h a n d led few , if a n y , m a tters
for th e w ork ers. A fifth c o m p a n y u n io n w a s still in th e org an ization a l sta g e a n d h a d as y e t n o set-u p for
n eg o tia tio n or d iscu ssion ; b u t sta te m e n ts b y m a n a g em en t an d b y th e in d iv id u a l selected b y m a n a g em en t
to h ead th e p r o sp ectiv e o rg an ization in d ic a te d th a t it w o u ld h a v e o n ly a narrow area o f fu n ctio n in g .
F or th e rem a in in g 121 c o m p a n y u n io n s, r ea so n a b ly c o m p le te d a ta o n m a tters n eg o tia ted w ere o b ta in ed .
T h e q u estio n n a ire u se d b y th e B u rea u a g en t co n ta in ed a ch eck -list (see p . 297) o f ty p e s o f su b jects n ego
tia te d w ith th e em p lo y er b e tw e e n Ja n . 1,1933, a n d th e v is it o f th e field ag en t (A p r il-J u n e 1935); th e persons
in ter v iew e d w ere also ask ed to g iv e d eta iled illu str a tio n s o f th e cases h a n d led u n d er each h e a d in g ch eck ed .
In a d d itio n , m in u te s o f m eetin g s, w h ic h w ere o b ta in ed for 41 c o m p a n y u n io n s, co n ta in ed ex a m p les o f su ch
cases, w h ile 4 or 5 c o m p a n y u n io n s fu rn ish ed ta b u la r a n a ly ses o f cases h a n d led a n d th eir d isp o sitio n .
I t w a s in e v ita b le th a t co n flictin g or v a r y in g an sw ers sh o u ld b e o b ta in ed o n th is su b ject in so m e cases.
In gen eral, co m p ila tio n o f th e list o f m a tters n eg o tia ted w a s b a sed u p o n th e rep orts o f m a n a g em en t officials
a n d e m p lo y ee rep resen ta tiv es. S in ce th ese tw o groups w ere m o st favorab le to w a rd s th e c o m p a n y u n io n ,
if th ere is a n y b ia s it is in favor o f th e c o m p a n y u n io n .
I n ta b u la tin g th e m a tters n eg o tia ted or d iscu ssed b y th e c o m p a n y u n io n s stu d ie d , a n a tte m p t w a s m ad e
to c o u n t as in d iv id u a l grieva n ces a ll cases (ex cep t disch arge cases) in v o lv in g on e or a t m o st a few w ork ers an d
n o t ra isin g q u e stio n s regard in g th e gen eral ru le to b e follow ed u n d er certain circu m stan ces. G en eral m a tte r s
a n d ru les w ere liste d u n d er th e ap p rop riate h ead in g s, an d insofar as p o ssib le a n a tte m p t w a s m a d e to exclu d e
in d iv id u a l g rieva n ces from th ese h ea d in g s. T h is w a s n o t a lw a y s p o ssib le a n d a certain a m o u n t o f o v er
la p p in g rem a in s. T h u s, w h ile th e figure o n in d iv id u a l grieva n ces is m ore or less correct, it is p rob a b le th a t
th e figu res o n so m e o f th e oth er ite m s, n o ta b ly sen io rity an d w age rates for specific o ccu p ation s, con tain
cases o f in d iv id u a l co m p la in ts as w e ll a s o f general rules. In a d d itio n d ischarge cases w ere g en erally h a n d led
on an in d iv id u a l b a sis a s th e y arose, rather th a n on th e b a sis of general rules. (See p . 166.)
162
MATTERS DISCUSSED OR NEGOTIATED
163
and health of the workers were considered by about two-thirds. This
was nearly twice the number that raised questions involving seniority
and more than twice the number that took up questions of type of
wage payment. Wage rates for specific occupations were handled by
about three-fifths of the company unions, general wage increases or
decreases by about one-half.
The number of company unions which negotiated or discussed the
various types of subject matter is given in the following list:2
N um ber o f
com pany
u n io n s
Individual grievances_______________________________________
Safety and health___________________________________________
Wage rate for specific occupations___________________________
General wage increases or decreases__________________________
Methods of sharing or rotating work_________________________
General rules and regulations________________________________
Discharge of an employee or employees____________________ _
Rules of seniority_______________________________________ ____
Changes in weekly or daily hours____________________________
Type of wage payment (piece work, bonus, etc.)_____________
85
80
73
64
53
51
51
43
36
31
Individual grievances.— The cases of individual grievances covered a
wide variety of subjects such as mistreatment, failure to get a fair
share of work, safety hazards on a particular job, improper lay-off or
discharge, and other types of complaint.
On the basis of the available evidence, the 85 company unions that
handled grievances can be placed in three large groups, according to
their effectiveness.3 The groupings are of approximately equal size.
Of the total, 27 appear to have functioned effectively as agencies to
handle the complaints and problems of individual workers; 28 indicate
a limited amount of effectiveness; 30 either took up an insignificant
number of individual grievances or had no particular success in hand
ling them.
2 T h e a n a ly sis o f m a tters d iscu ssed or n eg o tia ted is con fin ed to th e p eriod b etw een Jan . 1, 1933, an d
tim e o f v is it o f field a g en t, A p r il-J u n e 1935. C om p arison o f th e m a tte r s rep orted n eg o tia ted in an sw er
to th e m a il q u estion n a ire a n d th o se in th e field s tu d y rev eals certain d iscrep an cies an d v a riation s. T o b egin
w ith , in a ll b u t on e case th e p rop ortion o f com p a n ies rep ortin g n eg o tia tin g th e va riou s m a tters is so m ew h a t
le ss u n d er th e field s tu d y th a n u n d er th e m a il stu d y . I n a d d itio n th ere are certain differen ces in ran k .
O f th ese th e reversal o f p o sitio n as b e tw e e n general w ag e ch an g es a n d w ag e rates o n sp ecific o ccu p a tio n s is
p erh a p s d u e t o th e closer c h e ck afforded b y th e field stu d y , so m e o f th e form er b ein g sh ifte d b y th e field
a g en t to th e la tter. S im ila rly , th e h ig h ran k in th e m a il retu rn s o f ch an g es in w e e k ly or d a ily h o u rs is
p r o b a b ly d u e , accord in g to th e ev id e n c e o f th e field stu d y , to th e in c lu sio n o f q u estio n s o f r o ta tio n o f w ork
an d o f tim e o f b eg in n in g w ork , rath er th a n n u m b er o f hou rs to b e w ork ed in th e regular d a y or w eek . (See
p . 170.) I t is n o t su rp risin g , therefore, th a t th e n u m b er o f c o m p a n y u n io n s h a n d lin g a ll th re e o f th e m o st
sig n ifican t q u estio n s— general w a g e ch an g es, ty p e of w a g e p a y m e n t, a n d h ou rs o f w ork — w a s ap p recia b ly
less in th e field s tu d y th a n in th e m a il s tu d y . S im ila rly , th e p rop ortion o f c o m p a n y u n io n s n o t h a n d lin g
a n y o f th e se th re e q u e stio n s w a s greater in th e field s tu d y th a n in th e m a il rep lies. A lth o u g h th e sa m p le
co v ered in th e field s tu d y is le ss th a n in th e m a il stu d y , th e closer an d m ore careful ch eck m a k es it p erh ap s
a tru er stu d y o n th is p a rticu lar p o in t.
3 T h e m easu re o f su ccess in h a n d lin g in d iv id u a l grievances is n ecessarily a m a tter of op in io n . C o n clu sio n s
a n d sta tem e n ts h ere giv en therefore are based v e r y larg ely on v ie w s expressed b y th e m a n a g em en t a n d co m
p a n y -u n io n rep resen tatives, as w e ll a s rank-and-file em p lo y ees in ter v iew e d . W h ile a n ap p raisal b y oth ers
w o u ld n ecessarily resu lt in ch an g es in th e classification o f so m e m arg in al cases, th e figures c ite d g iv e su b sta n ce
to gen eralized d escrip tio n s o f rela tiv e e ffectiven ess. T h e d a ta in d ic a te d th a t th ere w as a te n d e n c y for em
p lo y ee rep resen ta tiv es a n d m an a g em en t officials to b e m ore favorab le th a n ran k -an d -file w ork ers in th eir
op in io n s con cern in g th e efficacy of th e com p a n y -u n io n m a ch in ery in h a n d lin g in d iv id u a l grievan ces.
164
CHARACTERISTICS OF COMPANY UNIONS
In the first group were most, but not all, of the organizations with
full-time paid company-union officials. Here, too, were most of the
organizations which had demonstrated some ability to negotiate with
management regarding wages. One had been captured by the tradeunion and really was a trade-union committee. Others approached
trade-union form and independence. Still others were in companies
in which the personnel department and the operating management
showed an unusual interest in uncovering and remedying such griev
ances. A large proportion of these 27 companies had personnel
managers.4
Despite fairly successful results, workers in some cases seemed to
be afraid to push their demands. In others, there was a great em
phasis on making requests “ reasonable.” The president of one
company union stated that a worker’s representative divorced from
the plant could be more effective because the men hesitated to push
complaints in a forceful manner for fear of their supervisors. In
contrast, an employee representative in another instance said:
The plan works fine. There doesn’t need to be any discontent among the
workers. If their requests are reasonable, management will always go half way.
Of course, there are always some radicals who wouldn’t be satisfied with anything.
In the second group of company unions which indicated only a
limited ability to adjust individual grievances, three had full-time
company-union officials and the proportion of personnel managers
was as large as in the first group. Limited success was due to various
factors. Some had not won the confidence of the men. Others had
not received much cooperation from management. In others there
was too much dependence upon the individual employee representa
tive. About half of the workers interviewed in one company stated
that they paid no attention to the organization because they thought
they could settle their own troubles individually equally as well as the
council. The personnel manager in one case was worried by the fact
that so few grievances had been brought up. “ More must exist” , he
said, “ and it is only a distrust of management and the council and a
fear of discrimination which prevent their emergence.” Two workers
in the same plant expressed similar beliefs. The president of one
company union said:
The plan has done some good in a number of cases. But still, most of the men
would feel hesitant about making a grievance for fear of their jobs. Not that
conditions are bad. The company is mighty good to work for. But still a man
doesn’t want to get a reputation as a troublemaker.
The third group had attempted to handle grievances, but had either
failed in the cases taken up or had not become generally established
as the grievance agency. Only two-fifths of these were in establish4
T w e n ty -o n e o f th ese 27 co m p a n y u n io n s h a d p erson n el m an agers, w h ile 68 of th e e n tire 126 c o m p a n y
u n io n s h a d p erson n el d ep a rtm en ts, p erson n el m an agers, or oth er fu ll-tim e officials in charge o f p erson n el.
MATTERS DISCUSSED OR NEGOTIATED
165
ments with personnel managers or departments. None had a full
time official. In at least two instances the company-union mechanism
was considered as no improvement over the previous method of hand
ling grievances through the foreman or the personnel department.
The vice president of one company union said that at the beginning
quite a few individual grievances were taken up by employee repre
sentatives with the foremen until the men realized their grievances
were not being settled. Fear of the reaction of the foremen was re
sponsible for failure to raise complaints in some instances.
About 30 percent of the company unions studied had handled no
individual grievances. At least 9 of these 36 company unions had
been organized in the face of a strike or a threatened strike, and 7
were not actively functioning. None had a full-time official who
devoted his attention to general matters 5 and only a third were in
companies with personnel departments. Absence of a personnel
manager seemed to be related to failure of the company union as a
grievance agency, although both may be due to management’s failure
to appreciate the importance of the satisfactory handling of individual
grievances.
Wage rates fo r specific occupations.6— There is some evidence that
company unions tend to look upon wages and wage rates as a matter
involving specific occupations and individuals rather than as one
affecting the entire body of workers. The differences between indi
viduals and their work were emphasized by a number of companyunion officials. They therefore thought of their function as merely
that of adjusting individual wage rates rather than securing a general
increase in the wage level.7 One chairman of a company union said:
“ I don’t quite agree with the idea of raising all wages together. One
man may be a much better worker than another.” Another companyunion official said his organization had not negotiated any wage
matters and did not intend to negotiate except as individual cases.
In a few cases the company discouraged independent time and
production studies by the company-union representatives and in other
ways showed an unwillingness to permit them to question the findings
of its time studies. Insistence by management on the maintenance
of existing differentials as “ necessary” or “ reasonable” prevented
change in individual rates in many cases. Thus a management rep8 O ne h a d a fu ll-tim e p a id official. H e h a d b een e m p lo y ed w h e n th e organ ization w a s a b en efit a g en cy .
H is d u tie s c o n tin u e d to b e co n fin ed to b e n e fit a c tiv itie s after it s reorgan iza tio n u n d er th e N . R . A .
6 A c o n tro v ersy in v o lv in g w a g e ra tes o n a sp ecific o ccu p a tio n w h ere o n ly on e or tw o p erson s are affected
b y th e rate, is h a rd ly d istin g u ish a b le from a n in d iv id u a l g rieva n ce. T h u s th ere m a y b e so m e o v erla p p in g
in th e figu res o f c o m p a n y u n io n s rep orted a s h a v in g h a n d led th ese tw o m a tters.
S im ilar o v e rla p p in g is p o ssib le b e tw e e n th e q u estio n s o f w a g e ra tes o n sp ecific o ccu p a tio n s a n d gen eral
w a g e ch an g es. T h u s tw o or th ree c o m p a n y u n io n s w h ic h rep orted h a v in g n e g o tia te d a gen eral w a g e ch an g e
h a d , in fa ct, secu red a gen eral r ecla ssifica tio n o f in d iv id u a l jo b s. S in ce th is recla ssifica tio n resu lte d in in
creases for a ll classes o f w ork ers, it h a s b e e n classified as a gen eral w a g e in crease. H o w ev er , ch an g es w h ich
in v o lv e d sev era l b u t n o t a ll o ccu p a tio n s or d ep a rtm en ts o f a p la n t are classified as w ag e ch an g es o n sp ecific
o ccu p a tio n s a n d n o t gen eral w a g e ch an ges.
7 See in th is c o n n ectio n sta te m e n t q u o ted in ch . X I V , p . 145.
166
CHARACTERISTICS OF COMPANY UNIONS
resentative in one case, charged with presenting to the central office
the request of the employee representatives “ that the new proposed
rate for second-class machinists should be increased from 94 cents to
98 cents an hour,” reported back to the employee representatives as
follows:
It was the opinion of the Manufacturing Production Committee at the central
office that the rate of 98 cents for second-class mechanics did not make sufficient
differential between first- and second-class rates and further that the 94-cent
rate had been satisfactory to all other second-class mechanical groups in both
plants and should therefore stand as proposed.
On the other hand, in many cases requests for adjustment of specific
wage rates were given prompt and careful consideration by manage
ment. Some of the company unions were very active in this field and
many were successful.
Discharge.— The great majority of company unions which handled
complaints about discharges apparently did so without a background
of specific rules governing the subject.8 The approach was rather
that of an individual grievance arising from a discharge which was
considered to be unfair in terms of certain generally recognized
principles of fair treatment. Only a few had discussed or negotiated
with management the general principles to be observed in discharges.
As a result of these negotiations, one secured for its members the right
to know the reason for his discharge. Three obtained the right to be
consulted on all discharge cases but apparently never found occasion
to object to any specific discharge. Another secured from manage
ment the promulgation of certain rules limiting the company’s power
of summary dismissal.9 Another agreement provided that—
No employed member of the (company union) shall be discharged without
approval of the shop committee. In case of failure in agreement between the shop
committee and the company, the matter shall be submitted to arbitration.
The unsuccessful attempt of one company union to obtain impartial
hearings on discharges is revealed by the difference between the
discharge clauses in the agreement as originally proposed by the
company union and as finally signed. The former, as submitted by
the workers, provided that—
The employer agrees that no member shall be discharged during the duration
of this contract without a fair and impartial trial before both parties.
The agreement as signed provided that—
The association agrees that the employer has the right and prerogative to lay
off, pay off, or discharge any employee for incompetence, insubordination, or for
infraction of prescribed shop rules.
8F iftee n c o n stitu tio n s liste d disch a rg e a m o n g th e su b jects to b e con sid ered b y th e c o m p a n y u n io n b u t
d id n o t se t forth a n y sp ecific p rin cip les to b e fo llo w ed . O n th e o th er h a n d , 11 sp e c ific a lly reserv ed to m a n
ag em en t con trol ov er h irin g an d disch arge. See ch . I X , p . 103.
9T h e se ru les, h o w ever, w ere v o id e d w h e n th e o u tsid e u n io n ob ta in ed eq u al reco gn ition w ith th e co m
p a n y u n io n .
MATTERS DISCUSSED OR NEGOTIATED
167
In contrast to this was the case of a company union which, having
maintained that the employer was to have absolute control of dis
charges,10 later obtained an agreement providing that no person was
to be peremptorily dismissed. Under the later agreement, workers
were first to be suspended without pay, and the company union
was to be given a chance to appeal the discharge if they felt an
appeal justified.
Control of discharge cases is potentially hampered by the common
provision that, upon separation from the pay roll, employees cease to
be members of the company union. One company refused to hear the
appeals of the company union on discharge cases, management point
ing out that under the plan’s constitution only a person on the
pay roll could be heard.11 In order to meet this difficulty, four
constitutions specifically provided that a discharged worker should
continue to be a member until the company union had agreed that his
discharge was justifiable.
Reports on discharge appeals secured for 34 company unions showed
in 16 instances that the case or cases handled by the company unions
resulted in the discharged employees being reinstated. Six other
company unions were successful in some cases and failed in others. In
the remaining 12 cases the company refused to reinstate any persons.
In some of these, management refused to give any consideration to the
appeal. In others, the appeals were disposed of by a mere statement
by management that a given company rule or policy had been violated.
Sometimes the question was one of fact— whether the employee was
drunk or had cheated or had a poor record. Thus in one case a store
manager was discharged. He was a member of the branch employees’
committee but not particularly active. Although the discharged
manager had not entered a complaint, the executive board decided to
take the matter up and demanded reasons for the discharge. The
entire branch committee was called into the office and all records were
opened to them. The records showed a shortage of goods in the man’s
store and the committee thereupon dropped the case.
One company union went to the point of taking a strike vote before
a reinstatement was made. In another case two employees claimed
that they had been discharged for trade-union activity. Although
the president of the company said they had been discharged for poor
work and for doing their own work on company time and machines
i° T h e earlier sta tem e n t, con ta in ed in a b rief h isto r y of th e organ ization , read: “ O ne of th e m o st str ik in g
p ro v isio n s, a n d on e th a t sh o w s v e r y clea rly th a t th e association m a n a g em en t g iv e s m ore th a n lip serv ice to
th e id e a th a t th e c o m p a n y m u st p rosp er to in su re p rosp erity for its e m p lo y ees, sta te d th a t th e asso cia tio n
sh a ll h a v e n o in flu en ce in th e m a tte r o f h irin g or firing a n em p lo y ee . R eco g n izin g th a t th e c o m p a n y is r u n
n in g t h e b u sin ess a n d sh o u ld b e g iv e n free rein to op erate le st in efficien cy d efeat th e co m m o n o b jectiv e, th e
asso cia tio n en ters after th e fact if it b e lie v e s th a t a n in ju stice h a s b een d o n e. I n m a tters o f p ro m o tio n th e
ru le o f se n io r ity h o ld s, b u t h ere a g ain th e b e st in terests o f a ll are con sid ered b y a p ro v isio n w h ic h d eclares
th a t se n io r ity sh a ll b e recogn ized o n ly w h e n a ccom p a n ied b y c a p a b ility an d th a t c a p a b ility sh a ll b e d eter
m in e d b y th e su p erin ten d en t w h o , o f course, rep resen ts th e m a n a g e m e n t.”
11 T h is c o m p a n y u n io n su b se q u e n tly w a s a b an d o n ed , h a v in g b ecom e d iscred ited w ith th e w orkers.
168
CHARACTERISTICS OP COMPANY UNIONS
without asking permission of the foreman, the men were reinstated
upon the insistence of the representatives. The reason as given by
the vice president of the company was:
Neither of the men were very good workmen, but the representatives considered
the matter as involving an important principle.
Employee representatives in one company union of the jointcommittee type were at one time given virtual carte blanche with
respect to discharge. Management representatives on this com
mittee at first abstained from voting on discharge cases, leaving the
decision to the action of the employee representatives. In order to
relieve themselves of entire responsibility, however, the employee
representatives prevailed upon management to vote on such matters.
Seniority .— Like discharge, seniority rules restrict the employer’s
power to hire and fire, promote and transfer as he sees fit. The reluc
tance or opposition of some employers to seniority restrictions made
it impossible for some company unions to negotiate for general rules
or the adjustment of individual complaints on this subject. Usually,
even when seniority was given consideration, efficiency was to be
given first consideration. In some instances the company agreed to
observe seniority “ as much as possible” , or “ if possible” , or “ when
members capable of filling a vacancy are available.” 12
In a few cases seniority was accepted without any reference to effi
ciency. One agreement stated that “ seniority of service shall at all
times be recognized.” A second applied seniority to lay-offs only, and
a third to lay-offs and promotions.13 A fourth contained detailed
provisions regulating the seniority rights of the workers.
Rotation o f employment.— Rotation of work is a field in which com
pany unions have been relatively active and successful. While an
official of one company said that “ methods of sharing work are entirely
our business” , many companies accorded considerable leeway to their
company unions in deciding whether and to what extent the work avail
able should be rotated among employees. In a few cases the decision
was left entirely in the hands of the company union; in others its
recommendations or views were given careful attention.
One agreement provided in considerable detail for the rotation of
work “ in order to take care of as many of our regular men as possible
during the winter months.” One employer took great pride in the
allocation of work which had been carried out by the company
12 T h e ag reem en ts of tw o of th ese c o m p a n y u n io n s, b o th in th e sa m e co m p a n y , gran ted th e organ ization s
th e righ t to b e co n su lted in p erson n el ch an ges arising from a v a r iety of situ a tio n s. T h e m ore co m p reh en sive
o f th e tw o p rov ision s sta ted th a t: “ In e v e n t o f p rom o tio n or d em otion or in e v e n t it b eco m es n ecessary or
a d v a n ta g eo u s to reorgan ize a n y sta tio n or p la n t, or c o n tem p la tin g sh u ttin g d o w n or sta rtin g u p p la n ts, th e
e x e c u tiv e co m m itte e o f th e association sh a ll b e n o tified b y m an a g em en t for d iscu ssion an d co n sid eration of
m ean s of effectin g reorgan ization w h ic h sh a ll b e st fu rth er in terests o f b o th pa rties h ereto .”
*3 T h e last-m en tio n ed c o m p a n y u n io n p ro v id ed in its co n stitu tio n th a t “ I t sh a ll b e th e d u iy of th e m e m
bers of th e u n io n co m m itte e s in b a rgain in g w ith th e c o m p a n y to u rge se n io r ity rig h ts.”
MATTERS DISCUSSED OR NEGOTIATED
IQQ
union. The management in this case had submitted the following
statement:
In the light of all the information which we can get and using our best judg
ment, it appears that the curtailment necessary is as stated below. In order to
present various alternatives the necessary curtailment will be expressed three
ways, all of which are equivalent as far as production goes: (a) Keep the 40-hour
schedule and lay off about 80 people; (b) reduce hours to 36 and lay off about 30
people; (c) (intermediate between (a) and (b)) reduce hours to 38 and lay off
about 55 people.
The management will welcome the recommendations of the council on this
subject.
The joint council decided on the intermediate reduction of hours
and personnel.
The extent to which management was willing to go in respecting
the wishes of employees with reference to spreading the work, is
illustrated by the following clause in one agreement:
Employer and association mutually agree that in case of lay-off all available
work will be divided (spread) as equitably as is practicable; the employer further
agrees to consider any reasonable request from members of the association con
stituting a majority of any individual group for the dividing of time, or spreading
of work, and to act thereon promptly, in so far as it is practical and economic for
plant and employees alike, so long as the minimum of work per employee does not
go below 24 hours in any workweek; and the employer further agrees to permit the
spread of work to a minimum of 16 hours per employee per week, provided a
secret vote shall first be taken in such individual group to determine the willing
ness of such group to accept less than 24 hours per week per employee.
Health and safety .— In the field of health and safety, many company
unions find their principal and most effective activity. They serve
as an adjunct of management, calling attention to situations which
impede production and jeopardize the individual worker’s health.
These are matters which personnel managers and efficiency engineers
are interested in unearthing and rectifying. The company union
serves as the initiating factor toward the correction of situations
which are annoying or dangerous to the workers.
Very few requests for improvements in conditions of safety and
sanitation were turned down. Conveniences and safety equipment
were obtained through the efforts of a number of company unions.
In a few cases the company, on investigation, found the complaint
unjustified or the remedy proposed ineffective; and in some others
requests were refused on the ground that the expense involved was
too great.
1 54875°— 38-------12
Chapter X V III
Wage and Hour Negotiations
The crux of the employment contract lies in the statement of how
much money the worker is to receive and how many hours per day
or per week he will work. Related to the question of wages is that
of the basis on which wages will be paid— whether by the hour, day,
or week; by the unit produced; or under some bonus or incentive
wage plan. Although one-third of the company unions studied had
not taken up with management any of these important matters in
the period studied,1 it does not necessarily follow that there were no
wage or hour changes in these companies during this period. Such
adjustments as were made, however, were a result of action by
management without intervention by the company union or of
response by management to code legislation.
Hours o j work .— The period covered by this study was one of
marked decline in the length of the working week throughout industry.
It was the period of N. R. A. code formulation, which more or less
established the 40-hour week. This may explain why the company
unions studied did not ask for shorter hours. Indeed, requests for
changes in hours of work on which details were available were in the
direction of increased hours.2 In many cases this would have involved
violation of the codes. Such requests were invariably refused.
Whenever a choice of code provisions was offered the workers by
management, the company muon requested the code providing the
longer hours. In one case in which the company operated under
several codes, they chose a 40-hour rather than a 35-hour code.
Another company which had been operating on a 35-hour week while
the code provided 40 hours, asked the company union to agree to the
longer hours and this was done. In another case the company union
obtained a 40-hour week instead of a 35-hour week for a group of
workers by extending their work to cover another operation.
Requests of company unions for changes in the time of starting or
quitting work or the length of the lunch period or the arrangement of
1 Ja n . 1, 1933, to sp rin g of 1935.
2 T h e c o m p a n y u n io n is co m p o sed o n ly of th e p resen t e m p lo y ee s of th e co m p a n y , an d in m a n y cases o n ly
o f th o se w h o h a v e b een e m p lo y ed a certain le n g th of tim e . T h e ir in terest, therefore, m a y b e p rim a r ily in
th e d irectio n o f reta in in g as m u c h e m p lo y m e n t as p o ssib le for th e reco gn ized b o d y o f e m p lo y ee s. T h e y
h a v e n o u n e m p lo y e d m em b ers to feel resp on sib le for. T h e y m a y therefore h a v e little , if a n y , con cern w ith
th e p ro b lem o f p u ttin g u n e m p lo y e d to w o rk . W h ile th e y are w illin g to share th e w o rk e q u ita b ly a m o n g
th e e x istin g force o f e m p lo y ee s (see ch . X V I I , p . 168), th ere seem s to b e n o desire or feelin g of o b lig a tio n to
sp read th e w ork am o n g th e u n e m p lo y e d .
170
WAGE AND HOUR NEGOTIATIONS
171
working hours so as to allow a holiday on some particular occasion
were almost invariably granted.3
Methods of wage 'payment.— One-fourth of the company unions
studied had discussed or negotiated methods of wage payment.
These discussions involved questions of whether employees should be
paid on a time basis, or on a piece rate, or under some form of bonus
or incentive system.4 Requests for changes in methods of payment
were complied with by management in about half the cases for which
data were available.5 In a few instances pressure by the company
union prevented management from failing to comply with a previously
announced bonus system. A number of company unions asked for
the adoption of an incentive system or the extension of this system
to additional units in the plant. In one case, the trade-union in the
plant was attacking the Bedaux incentive wage system while the
company union was urging its extension.
A few company unions successfully attacked existing incentive
schemes. Thus in one case men complained that the regular scale
with the bonus resulted in the more efficient men getting more money
than the others. They demanded straight hourly wages with no
bonus. The request was granted. In one instance, where the speed
merit system had been introduced in some departments, management
agreed not to extend it to departments where the men didn’t want it.
On the other hand, the men in one company expressed their dislike
for the Bedaux system. Management refused to make a change.
The case was never pressed by the employee representatives.
General wages.— Increases in wage rates were general throughout
the country during the period covered by the study. It was the
beginning of recovery from the depression and there was a general
upward movement of wage rates. The data gathered in the study
permit an analysis of the extent to which the company unions studied
requested general increases in wage rates. It is not possible, from
the data, to judge the reasonableness of the wage demands made by
the company unions. However, it is possible in most cases to deter
mine whether or not active negotiation entered into the decision
with regard to wage rates. This, rather than whether or not wage
3 S u ch in sta n ces, w h ic h can n o t b e con sid ered as a ffectin g n u m b er of hours w ork ed , are n o t in clu d ed
am o n g th e c o m p a n y u n io n s w h ic h d iscu ssed or n eg o tia ted w e e k ly or d a ily hou rs.
4 T h is w a s th e case in 31 o u t o f th e 126 c o m p a n y u n io n s. T h e r e la tiv e in freq u en cy w ith w h ic h th e ty p e
o f w ag e p a y m e n t b eca m e a su b ject for n e g o tia tio n b y c o m p a n y u n io n s is n o d o u b t in p a rt d u e to th e fact
th a t th e p o ssib ilities o f ch an g e from o n e form to a n oth er are lim ite d . T h e n u m b er o f p o ssib le ty p e s is, in
th e first p la ce, n o t large. In a d d itio n , v a riou s tech n o logica l an d c u sto m a r y factors in th e in d u str y restrict
th e p o ssib ility o f ch an g e. E m p lo y e r s m a y n o t h a v e su g g ested a n y ch an g es a n d w ork ers m a y h a v e b een
sa tisfied or a t lea st so a ccu sto m ed to w h a t th e y h a d , th a t th e q u e stio n w a s n ev er b rou g h t u p .
« D e ta ils w ere a v a ila b le o n 17 c o m p a n y u n io n s. S o m e o f th e p erson s in ter v iew e d in terp reted th is item
to in c lu d e su c h m a tters a s p ro v isio n for w e e k ly in ste a d o f b im o n th ly p a y m e n t. O th ers in terp reted th is
ite m to m e a n ch an g es in th e rate o f p a y or m e th o d o f tim in g , w h ic h d id n o t, h o w ev er, affect th e ba sic
m e th o d of p a y m e n t. T h e se are n o t in c lu d e d in th e n u m b er o f c o m p a n y u n io n s rep orted to h a v e h a n d led
m e th o d s of w a g e p a y m e n t.
172
CHARACTERISTICS OF COMPANY UNIONS
increases were obtained, is the principal criterion used in the following
analysis.
In nearly half of the company unions studied 6 no general wage
changes were requested or negotiated by the company union during
the period studied. In seven of these, wage and hour questions were
not within the jurisdiction of the company union. Employees in
one case were informed at the time of the organization of the com
pany union that matters of wages and hours were best left to the
company. “ The company knew how much they were able to pay
and would pay it.” In another case the assistant superintendent,
who had obtained increases for several of the men in his department,
said: “ I never tried to have the men do anything about it through the
committee, as I don’t think they would have gotten any place.” The
chairman of this company union said that the employees’ committee
had practically nothing to do with the determination of wage rates.
In 19 cases wage increases had been granted but the company union
had been completely ignored in the process.7 In 10 others the com
pany union played a passive role but had nothing to do with the
initiation of wage increases and no negotiations were involved.
In some instances wage increases were offered by the management
and the company union went through the formality of accepting or
announcing the increase. The general superintendent in one case
described a wage increase thus:
We followed through our business curve and set a goal. When we reached it
we informed the shop committee and gave them 10 percent.
Two companies discussed increases with the company unions after
they had already been announced. One company announced a
lump-sum increase and asked the company union to arrange for its
allocation. In another case, when N. R. A. went into effect, the com
pany increased wages 25 percent. They offered this to the council.
Questions were asked. Then a resolution was offered by the elected
representatives approving the wage increase. Although the manage
ment considered the question of wages and hours strictly reserved to
itself, it presented the wage increase to the company union in order
to comply with the collective bargaining provision of section 7 (a).
The company felt that if the increase was “ just given” and “ not laid
before” the company union, it would not be “ collective bargaining.”
In one company, employees had asked for a wage increase but the
request never went beyond the employee representative. He refused
to bring it up until they signed a petition with most of the names in
6 F ifty -n in e o u t o f th e 123 for w h ic h in form ation w a s a v a ila b le h a d n o t ta k e n u p w ith m a n a g em en t th e
q u e stio n o f a general w ag e ch an g e. T h is n u m b e r in c lu d e s c o m p a n y u n io n s w h ic h w ere a b le to o b ta in w ag e
a d ju stm e n ts for in d iv id u a ls or o n specific o ccu p ation s. See p reced in g ch ap ter.
7 In th ree o f th ese, in creases or a d ju stm e n ts w ere m a d e as a resu lt o f th e a d o p tio n of th e cod e. In tw o ,
in creases w ere gra n ted w h ile a tra d e-u n io n w a s carryin g o n a strik e, in th e p la n t or in c o m p e titiv e p la n ts.
T w o in creases w ere gra n ted after a co m p etin g c o m p a n y in th e lo c a lity h a d ta k e n th e lead .
WAGE AND HOUR NEGOTIATIONS
173
the department on it. “ A representative must protect himself.” The
men did not have the courage to sign a petition, so he never brought
the matter up.
Sixty-four, or somewhat more than half of the company unions
studied, raised the question of general wage adjustments with manage
ment. Of these, 39 secured increases, 22 failed in their demands,
1 obtained a bonus system in place of the requested wage increase,
while 2 were forced to accept decreases. One of the latter, however,
staved off the decrease for 6 months. Seven of the organizations
which obtained an increase attempted to obtain a second; six of these
failed, while in the seventh case the matter was still pending at the
time of the field agent’s visit.
In seven cases where wage increases were granted, trade-unions were
active in the plant or industry, or competitors had recently granted
increases. In one of these companies employee representatives asked
for an increase, without setting any particular amount. It was only
after the large competitors granted increases that this company fol
lowed suit. One company union obtained a written agreement pro
viding among other things for a complete reclassification of all jobs
in the plant. It claimed credit for the resulting increases, despite the
fact that the reclassification had already been ordered by an arbitrator
appointed in connection with a dispute between the company and the
outside trade-union.
Ten increases followed closely upon the organization of the company
union. Two of these company unions, having obtained an increase
at the time of organization, never met again, while a third was shortly
displaced by a trade-union. In seven instances the evidence indicated
that wage increases were more or less definitely promised when and if
company unions were established, or were granted at an early stage
of the company union organization as a means of increasing its pres
tige, while a trade-union was also seeking support among the workers.
A newspaper item in one case described the proceedings as follows:
A 5-percent wage increase effective at once to some 750 employees of th e ---------Company was announced late yesterday#by the plant superintendent and the vice
president at the first meeting of the 40 delegates elected recently in the different
plant departments to represent the employees in dealing with the company officials.
The president of the company union in this case said:
The management made a special effort to grant this increase despite bad busi
ness conditions, because the company wanted to help the new organization.
In one company a number of people interviewed said that state
ments had been made in November and December 1933 by organizers
of the company union that the management had promised alO-percent
raise if the company union was successfully organized. The consti
tution was adopted late in November. Early in December the com
mittee sent to the president a report of its first meeting, containing
174
CHARACTERISTICS OF COMPANY UNIONS
requests from various departments phrased as follows: “ Employees
are inclined towards the expectancy of a wage increase.” “ Employees
expect a little increase in pay.” Nine days later the president of the
company issued the following letter:
We have been requested by the executive committee of th e ----------Employees’
Association to make an upward adjustment of wages.
Although the volume of business and financial income of the company does not
justify higher wages at this time, we wish to show our appreciation of the spirit
which prompted our employees to form this company association, and take pleas
ure in announcing that a 10-percent increase in wages will be given to a ll---------employees January 15 who are being paid on an hourly or piece-work basis.
A decided improvement in business for the coming year is expected and needed
to justify this increase. Your continued cooperation and loyal support of your
company is the best way to insure the continuance of better wages.8
Fourteen increases were apparently obtained, either in whole or as
compromise offers, without much effort by the company union.9 In
two, the employees presented a wage demand, the employer presented
a counterproposal, and the workers voted, in the presence of manage
ment representatives, to accept the counterproposal. Representa
tives in another company union asked for an increase but of no
specific amount, citing the rise in the cost of living to support their
request. Management agreed to raise all men in the lower brackets.
Another company granted half the increase asked by the company
union.
In 18 of the 22 cases in which increases were refused there were no
negotiations. The company union made a request for an increase.
The company responded in writing or orally, refusing to grant the
increase on the ground that business was bad, or the company could
not afford it, or rates paid were already equal to or above the prevailing
level. That ended the matter. To this group may be added one
case in which a cut was accepted without negotiation by the com
pany union. One instance was described as follows by management:
Recently the men asked what amounted to a 40-percent raise. We took the
request to the executive vice president. He was disgusted. He answered it in
writing and that was all to that.
8 A sim ila r con cessio n in ten d ed to g iv e th e c o m p a n y u n io n a go od sta rt w a s rep orted in on e in sta n c e in
co n n ectio n w ith ov ertim e. T h e c o m p a n y u n io n ask ed th a t su ch w ork b e p a id for a t tim e an d a h alf. T h e
c o m p a n y gra n ted th e r eq u est u p o n th e reco m m en d a tio n o f th e p erson n el m an ager. H e to ld th e h ig h m a n
a g em en t th a t th is w o u ld n o t b e th e o n ly w a g e q u e stio n to arise if th e c o m p a n y u n io n w a s a v ita l on e. H e
urged th a t th e firm gran t th e req u est, sa y in g th a t th e ex p en se w o u ld n o t b e m u c h sin ce th e firm ’s p o lic y w a s
a g ain st w o rk in g o v ertim e. G ra n tin g th is d em a n d , h e felt, w o u ld h elp w in th e con fid en ce o f th e em p lo y ees
in th e n e w c o m p a n y u n io n .
9 In th ree of th ese cases m a n a g em en t sta ted th a t th e in crease h a d b een v o lu n ta r ily g ra n ted , w h ile em p lo y ee
r ep re se n ta tiv e s cla im ed th e y h a d b e e n o b ta in ed b y th e c o m p a n y u n io n .
In co n n ectio n w ith th ese in creases w h ic h w ere o b ta in ed w ith little or n o effort b y th e c o m p a n y u n io n , it
sh o u ld b e rem em b ered th a t th ere is n o c er ta in ty th a t th e in crease w o u ld h a v e b e e n forth com in g in th e a b
sen ce o f a req u est b y a n org an ization . T h e se c o m p a n y u n io n s m ig h t h a v e served b e tte r th a n n o organiza
tio n a t all. T h is arg u m en t, h o w ev er, m u st b e con sid ered in th e lig h t o f th e fact th a t th is w a s a p eriod o f
risin g w a g es an d m a n y c o m p a n ies a m o n g th o se stu d ie d gra n ted in creases e v e n th o u g h n o r eq u est w a s
m a d e b y th e c o m p a n y u n io n . M o reov er, in sofar as th e c o m p a n y u n io n s w ere e sta b lish e d as su b stitu te s
for tra d e-u n io n s, th eir e ffectiv en ess in o b ta in in g w a g e in creases sh o u ld n o t b e ju d g e d b y com p a rison w ith
a “n o o rg an ization ” situ a tio n b u t w ith on e in w h ic h a tra d e-u n io n m ig h t h a v e b e e n in ex isten ce.
WAGE AND HOUR NEGOTIATIONS
175
The secretary of the company union said in this case:
We have not made a request for a general increase, but when management re
classified jobs we asked that the minimum rate be made 56 cents. We had no
idea that this meant a 40-percent increase and can understand that it was im
possible, as the management said.
A process resembling negotiation took place in 14 instances.10
The increases were obtained as a result of proposals and counter
proposals; compromises were arrived at on the basis of agreement of
the two parties rather than on decision of the management in response
to a request by the company union. Spirited discussion and the per
sistent pressing of issues occurred in many of these cases. Where an
increase was not gained or a decrease accepted, there was evidence
that the company union engaged in more or less vigorous presenta
tion of its demands.
However, close study of these company unions revealed in many
instances serious weaknesses and shortcomings as far as effective
negotiation was concerned. In one case the officers wl 10 led the strong
but unsuccessful attempt to obtain a wage increase weie discharged for
trying to convert the company union into a trade-union. Their suc
cessors, picked by the company, were not of the caliber to put up
such a fight. In another, management told the representatives,
without any challenge, that if the code was changed the agreement
would become void. In another case, where the personnel manager
stated that wages had been negotiated in joint council 10 times in the
last 15 years, many of the men did not consider the company union
to be an employees’ organization. The majority of its officers were
men in the higher-salary range, and employees said they depended
on the personnel department rather than the company union to
obtain redress of grievances for them.
Three of these fourteen company unions, although they presented
their position vigorously, never came into direct contact with the
company officials with authority to make decisions. Their requests
were forwarded in writing to absentee officials who rendered final
decision. All were automatic-participation organizations financed
entirely by the company.11 Among these was one company union
which covered three neighboring plants of a large company. At
one of the joint meetings covering the three plants employee repre
sentatives requested and obtained an investigation of cost of living
by a joint committee. This investigating committee presented its
report to a subsequent joint meeting covering the three plants.
S ev en o f th ese cases resu lted in increases; in fiv e cases th e in crease w a s refused, on e c o m p a n y u n io n ac
cep ted a decrease, a n d o n e case w a s still p en d in g a t th e tim e o f th e v is it o f th e field ag en t.
n I n o n e o f th ese cases m a n a g em en t w a s so in terested in esta b lish in g th e c o m p a n y u n io n in p la ce o f th e
tra d e-u n io n th a t it n u rsed th e form er alon g, su g g estin g to it s officials from tim e to tim e ch an g es th e y m ig h t
a sk for a n d b e su re o f ob ta in in g . A n e m p lo y ee rep resen ta tiv e in an oth er said : “ W e can ask a n d th e n w e
ca n ta k e w h a t’s g iv e n .”
176
CHARACTERISTICS OF COMPANY UNIONS
Following vigorous discussion of the report, the employee repre
sentatives retired for a separate meeting and returned with a resolution
stating:
We * * * are sure that we have proven our case on the result of the
budget survey and decrease in earnings. Therefore, we at this time on behalf of
our fellow workers, respectfully request consideration for a 10-percent increase.
Thereupon the chairman, a management official, stated that “ the
resolution as submitted would be included in the minutes and referred
to New York.” Following this the head of the subsidiary company
stated that “ there was no justification for a change under the conditions
on which wage scales have always been considered * * *. While
the president in New York City would no doubt be interested in
knowing the outcome of the meeting, the answer was final at the
present time.” 12
In three cases the aggressiveness of the company union was trace
able to officials who were also members of the outside trade-union.13
But even in these instances the limited independence of the company
union as a collective-bargaining agency was revealed by a statement
of one management official, who said: “ The plan is my baby and Fm
going to see that it’s properly brought up.”
In another instance among the 14, management support coupled
with a trade-union threat outside encouraged employee representa
tives to speak freely. The president of the company union, however,
felt that the organization was too weak to get anything through if
management really voiced some opposition.
Four company unions among the fourteen appeared to be self
directing and relatively independent in their wage negotiations.
Two of these were entirely financed by management.14 A third,
although now self-financed and self-directed, was the product of a
long period of very liberal management. The fourth company
union in the group had developed out of a trade-union local, as a
result of dissatisfaction over the administration of the local by the
representative of the national union.
Considerations advanced in wage negotiations.15— Six company
unions 16 had a definite provision in the constitution or agreement
setting up a general standard which should govern the wages of the
employees. In such cases the scope of wage negotiations was nar
rowed or definitely limited to the application of these standards. In
12A n in crea se w a s gra n ted in th is case so m e tim e after th e v is it of th e field ag en t.
13T h e se c o m p a n y u n io n s h a d b een se t u p e n tir e ly b y m an a gem en t.
u O n e o f th ese felt itse lf so d e p e n d e n t u p o n th e c o m p a n y ’s go od w ill th a t it a b an d o n ed a req u est for a
w a g e increa se rath er th a n p u sh for a rb itratio n in th e face o f th e c o m p a n y ’s op p o sitio n .
15 T o g e t th ese factors, th e sc h e d u le u se d b y field ag en ts c o n ta in ed sev era l q u estio n s in te n d e d to d escrib e
th e sta n d a rd s u se d in d eterm in in g w ag es. D o e s p la n se t sta n d a rd s for d eterm in in g w ages? W ag es p a id
b y co m p etito rs? P re v a ilin g w a g e in c o m m u n ity ? C ost o f liv in g ? I f p la n h a s n o p ro v isio n , is a n y sta n d
ard u se d in d eterm in in g w a g es w h e n b ein g n ego tia ted ? See a p p en d ix V , p p . 293-300, for c o p y o f sch ed u le.
16 I n fiv e o th er co m p a n ies b o th m a n a g em en t an d em p lo y ee rep resen ta tiv es sta ted th a t th e y con sid ered
th e N . R . A . cod e w ag es as th e stan d a rd .
WAGE AND HOUR NEGOTIATIONS
177
three of these, wages were to be based upon changes in cost of living,
although one subsequently abandoned this standard in favor of an
arrangement providing for an annual wage based upon a percentage
of the selling price of the product. One company functioned under
a profit-sharing arrangement.17 Another based wage rates on prevail
ing economic conditions, with a provision that if the profits of the
company in any quarter fell below the amount for the same quarter
in 1930, 1931, or 1932, the wage rates were to be revised downward.
No provision was made for automatic upward revision. A sixth based
wages upon the rates paid by firms of similar size in the vicinity.
This, in effect, meant the trade-union rate, since the industry in the
locality was rather well covered by the outside union.
In most of the company unions 18 various standards of more or less
definiteness were recognized as relevant in wage negotiations, although
they were not incorporated in any written document.
The most common standard used by management in considering
the general level of wages was the prevailing wage. In more than half
of the company unions reporting a wage standard, representatives of
management gave this either as the sole standard or as one of the
factors. It is not clear in all cases whether what was meant was the
wage paid by competitors or the wage paid for similar types of work
in the same community. In at least half of these cases the wage paid
by competitors was specifically indicated as the principal factor con
sidered in connection with wage rates.19
The prevailing-wage factor was also frequently considered as a
standard by company-union representatives, but almost equal sig
nificance was accorded changes in the cost of living. A common state
ment by employee representatives in answer to the question concerning
wage standards was: “ We argue cost of living and the company argues
prevailing wage.” The president of one company union, in com
menting on management’s statement that their wage was already
above others in the community, remarked: “ That’s child’s talk.
Other plants don’t concern us and the comparison makes no differ
ence.” One company-union chairman said: “ We argue the rising cost
of living. If there’s any better argument, I ’d like to know it.”
Limitations in wage negotiations.— To some extent, the use of cost
of living rather than competitors’ wage standards by employee repre17In th is c o m p a n y th e e m p lo y ee s w ere v ir tu a lly th e ow n ers o f th e b u sin ess. O p eration s w ere d irected
b y a b oard o f d irectors e lected in p a rt b y th e e m p lo y ees th ro u g h th e officials o f th e e m p lo y ee organ ization .
18 In 14 co m p a n ies m a n a g em en t sta te d th a t w ag es w ere se t b y a sy ste m o f job classification or ratin g, or b y
so m e in c e n tiv e w a g e sy ste m su p p o se d ly a d ju stin g p a y m e n t to th e efficien cy o f th e in d iv id u a l w orker. In
a lm o st all o f th ese cases, h o w ev er, n o sta te m e n t w a s m a d e a s to th e sta n d a rd or factors se ttin g th e general
le v e l o f w ag es a s d istin c t from th e r ela tiv e rates o n in d iv id u a l op eration s or job s. T w e n ty -fiv e co m p a n y
u n io n s rep orted n o d efin ite sta n d a rd s w h ic h w ere recognized in w a g e n eg o tia tio n s, b u t a lm o st a ll o f th ese
h a d n ev er n eg o tia ted w a g e m atters.
is T h e sa m e sta n d a rd w a s ap p lied w ith resp ect to other m a tters rela ted to lab or costs. T h u s on e co m p a n y ,
w h e n ask ed b y its c o m p a n y u n io n to p a y for o v e rtim e a t a rate o f tim e an d a h a lf an d to p ro v id e v a c a tio n s
w ith p a y , sta ted th a t it co u ld d o n o th in g a b o u t th ese u n til th e in d u str y as a w h o le h a d a cted .
178
CHARACTERISTICS OF COMPANY UNIONS
sentatives was due to their ignorance of wage scales in competitors’
plants, whereas the rise in the cost of living was something of which
they were immediately aware and which they felt they could measure.
A common expression by rank-and-file workers and employee repre
sentatives was: “ They say we get as good (or better) wages than at
other plants. But we have no way of checking up.” Only in ex
ceptional cases could employees meet workers of other companies in
the course of their work and exchange information. More typical
was the case of the employee representative who said, with regard to
competitors’ pay:
The company argues competition. We don’t know competitive conditions.
Our main competition is i n ----------(a distant city).
Lacking an independent source of data whose validity they could all
accept, employee representatives in the same plant sometimes
approached wage conferences with divergent pictures of the existing
wage situation. Thus in one case while one representative stated that
“ Our wages, I ’m pretty sure, are above the rest of the plants” , another
said that they were the lowest in the city.
Decisions on wage questions were in many cases made on the basis
of a presentation by management of data on profits, changes in cost of
living, comparative wages, and other pertinent matters. It was
perhaps inevitable that some employee representatives should question
the validity of the figures presented to them by management, although
they had no factual basis for their doubt. Thus an employee repre
sentative in one case expressed skepticism as to whether a wage increase
announced by the company had actually been applied to all employees
entitled to it:
I’ d like to see the pay roll since that 12%-percent increase. A lot of men
never benefited by it. We don’t know what changes were really made. We’ve
never asked to see it.
In another instance, employee representatives accepted as decisive
the statement by management that the company had not made enough
profits to warrant granting the increase requested by the company
union. Subsequently, they obtained information which led them to
believe that the company had misrepresented its profits.
Permission to see the books of the company, which was granted by
a few companies, would have been a meaningless offer to the great
majority of employee representatives. In one case in which the
employer stated that his books were always open for inspection by the
men, the workers were all unskilled laborers, mostly illiterate. In
another instance, an employee representative clearly expressed his
inability to handle the problems involved:
Management says we can get what information we want from the books.
We want to find out how much goes for salaries in total amount, for depreciation,
etc. We know we aren’t equipped to make a thorough study but maybe we will
WAGE AND HOUR NEGOTIATIONS
find out something.
credit union.
179
My only experience with such things is as treasurer of a
In spite of the need for expert assistance in obtaining data needed
for negotiation concerning wages, hours, and other important matters,
in only one or two cases had a company union hired an expert for help
on wage matters.20 One company union hired a lawyer to obtain a
certified copy of a trade-union agreement in a competing company.
Another employed an accountant, but the work which he did for the
company union was not described.
The vagueness and uncertainty of many of the replies to the question
of whether outside experts might be hired suggested that many times
the possibility of this course of action had never been considered.21
In only one-fifth of the company unions did the persons interviewed
agree that the employment of such a person would be possible if the
workers desired it. The clearest statement of the right of the com
pany union to hire outside technical assistance was found in a bilateral
agreement under which the level of wages was based upon the whole
sale value of the plant’s production. The company bound itself—
to give free access to the necessary books and records and full cooperation once
during each fiscal year to a private auditor selected by the union to check the
wholesale value of the production and the salaries paid during the life of this
agreement.
Several company unions had asked for the privilege of hiring out
side assistance but the company had refused. One company union
asked to examine the books of the company in connection with a
dispute concerning a wage increase. The privilege was granted, but
when the men asked for the right to have an accountant go over the
books, the company objected on the grounds that it did not want its
affairs publicized.
To some extent this dependence upon the permission of the company
was due to the fact that the company union had no funds, and man
agement did not regard this as the sort of reasonable service for
which it expressed a willingness to pay. Of the 28 company unions
which were reported as possessing the right to hire outside experts,
20A n o u tsid e ex p ert h a d b e e n e m p lo y ed b y 19 c o m p a n y u n io n s, b u t a lm o st in v a r ia b ly h e w a s a la w y er
c a lle d u p o n for a d v ic e as to org a n iza tio n . T e n ca ses in v o lv e d th e h irin g o f a la w y er to a ssist in th e org an iza
tio n o f th e c o m p a n y u n io n . In th ree oth ers a la w y er w a s h ired to h a n d le a n e lectio n or to ap p ear a t lab orb oard h earin gs. O n e c o m p a n y u n io n h ired a u n iv e r sity professor to a d v ise th e m h o w to a v o id o u tsid e
u n io n ism . A n o th er en ga ged a u n iv e r sity professor to d raw u p a co n stitu tio n a n d a la w stu d e n t o n a parttim e b a sis to a ssist w ith th e m in u te s an d p a rlia m en ta ry la w . A b o u t h a lf th ese exp erts w ere p a id from th e
c o m p a n y -u n io n trea su ry or o u t o f fu n d s raised b y collectio n s am o n g m em b ers. In a few in sta n ces th e exp ert
n ev er su b m itte d a b ill to th e c o m p a n y u n io n . T h e co m p a n y p a id for h is services in th e rem a in in g cases.
21P erso n s in te r v ie w e d in 48 c o m p a n y u n io n s agreed th a t su c h a c tio n w a s n o t p erm issib le w ith in th e
co n stitu tio n . I n 30 oth er cases th ere w a s n o p r o v isio n regard in g th is m a tte r or th e co m m e n t w a s th a t su ch
a c tio n w a s “ n o t fo rb id d en .” I n 15 in sta n c e s n o b o d y k n e w or w o u ld v e n tu r e a n o p in io n a s t o w h e th e r su ch
action w a s p erm issib le. In fiv e th ere w a s a difference of op in io n . A n in d e p e n d e n t org an ization o f em p lo y
ees m ig h t n o t con sid er su ch a c o n stitu tio n a l p ro v isio n n ecessary. S in ce c o m p a n y u n io n s w ere so p red om i
n a n tly se t u p , p a rticip a ted in , a n d fin an ced b y m a n a g em en t, th e ab sen ce o f su ch a p ro v isio n m ig h t
m ea n th e ab sen ce o f th e rig h t itself.
180
CHARACTERISTICS OF COMPANY UNIONS
11 relied entirely on the company for funds. The others collected
dues, but the rate of dues was generally low and few of these had
funds sufficient for this purpose. The chairman of an old estab
lished company union which had shortly before been unsuccessful
in an attempt to secure a wage increase stated that the right to
hire outside assistance was a necessary improvement if the com
pany union was to function successfully. He believed that manage
ment should give the company union an independent fund to use as
it saw fit.
Chapter X I X
Welfare and Benefit Activities
Welfare or benefit activities existed in two-thirds of the companies
studied. They were most frequently administered and financed solely
by the company without relation to the company union.1 In less
than half the cases, they were administered by the company union.2
In some instances the company union performed no other functions.
In a few of the company financed and administered benefit plans,
the company union was given special credit for them. Thus one
company issued a leaflet announcing the inauguration of its group
insurance plan in the following way:
At a meeting of the employees’ joint council the members voted unanimously
in favor of a plan of group insurance to provide sickness and nonoccupational
accident benefits as well as death benefits for the factory workers. Accordingly
the company has arranged with t h e ----------Insurance Company for such a plan
to become effective----------.
The evidence gathered, however, indicated that the insurance
system was in effect offered to the employees through a newly organ
ized company union as a means of building up its prestige. The con
stitution of another organization, printed by the insurance company
which carried the group insurance, was bound with the insurance
announcement. One company union, in presenting its advantages
over the trade-union, claimed credit for providing loans without col
lateral or interest. However, the loan application clearly indicated
that the loan was being made by the company and not by the company
union.
The benefit and welfare activities of the company unions varied not
only in nature but also in the extent and type of management partici
pation. Some were entirely dependent on the company for funds.
Some were entirely financed by the employees. Others provided
various degrees of joint participation.
Seven companies maintained suggestion systems in which prizes
given by the company for the most valuable suggestions were an
nounced through the company union. One organization was in charge
of the profit-sharing arrangement of the company. In these cases
the company supplied all the funds involved in operating these plans.
1T h is w a s th e case in 47 of th e 84 com p a n ies in w h ic h w elfare a c tiv itie s e x iste d . In su ch cases th e c o m p a n y
m a in ta in ed a sep ara te em p lo y ee s’ b en efit a ssociation or ad m in istered th e b en efit p ro v isio n s d ir e c tly th ro u gh
its o w n p erson n el ag en cy .
2In an oth er case th e w elfare a c tiv ity w a s sp o n sored b y th e co m p a n y , b u t th e c o m p a n y u n io n m a in ta in ed
a co m m itte e to ta k e care o f co m p la in ts in co n n ectio n w ith th ese a c tiv ities.
181
182
CHARACTERISTICS OF COMPANY UNIONS
The company union performed an administrative function which in
other companies was handled by the personnel department or some
other management agency.
Five company unions provided for cooperative purchasing of
certain commodities by the employees, who shared in the savings
made possible through large-scale purchases. One company advanced
the funds for the original purchases, the company union guaranteeing
payment.
About one-fourth of the organizations maintained some form of
health, accident, death, loan, relief, or other benefit plan.3 In
general, in those providing benefits, membership in the company
union carried with it participation in the benefits administered.4
Almost two-thirds of the organizations which were engaged in
benefit activities received some financial contribution from the com
pany either directly to the benefit fund or to the general treasury
of the organization.6 In several other cases, while management did
not make financial contributions to these activities, other lands of
assistance were rendered.6
Seven company unions provided benefits without any apparent
assistance, financial or otherwise, from the company. One of these
paid sick benefits of $10 a week for a maximum of 13 weeks. For
the most part, the others provided gifts or loans to needy employees,
Christmas baskets, flowers for the sick, and small sick, death, or
marriage benefits.
Many of the company unions providing benefits 7 were primarily
benefit organizations. They performed no other significant function.
3 T h is w a s tru e o f 29 c o m p a n y u n io n s. S o m e o f th ese also h a d su g g estio n p la n s or p la n s of co o p era tiv e
p u rch asin g. F iftee n o f th e c o m p a n y u n io n s p ro v id ed for sick b en efits. T w e lv e h a d gro u p -in su ran ce
po licies or so m e o th er form o f d ea th b en efits. T h ir tee n p ro v id ed or assisted in a d m in iste r in g so m e form
of u n e m p lo y m e n t relief or a ssistan ce to n e e d y e m p lo y ee s or form er e m p lo y ees. E ig h t m a in ta in ed so m e
form o f lo a n fu n d , in fiv e cases c o u p led w ith a sa v in g s p ro v isio n . M ed ica l a id w a s p ro v id ed in th ree eases,
h o sp ita liza tio n in on e, accid en t in su ra n ce o n ly in an oth er. A retirem en t p la n w a s op erated b y on e c o m p a n y
u n io n . A n o th er c o m p a n y u n io n p a id a b en efit o f $25 to a n y m em b er w h o m arried.
4In o n e case th e c o m p a n y u n io n h a d b en efit a n d n o n b en efit m em b ersh ip . In tw o o th ers a sep arate
sick -b en efit a ssociation w a s se t u p to w h ic h o n ly c o m p a n y u n io n m em b ers w ere eligib le. In tw o cases
w h ere th e c o m p a n y u n io n w a s b a sed o n a u to m a tic p a rticip a tio n , sep ara te m u tu a l-a id asso cia tio n s w ith
o p tio n a l m em b ersh ip w ere a d m in istered b y th e c o m p a n y u n io n . In several cases b en efits a llo tte d w ere
n o t n ecessarily co n fin ed to co n trib u tin g m em b ers. T h u s tw o c o m p a n y u n io n s a d m in istered th e o n ly w e l
fare fu n d in th eir c o m m u n ities. T h e fu n d w a s accu m u la ted b y co n trib u tio n s o f e m p lo y ee s a n d officials
of th e c o m p a n y , an d th e w elfare co m m itte e of th e c o m p a n y u n io n d eterm in ed w h o in th e c o m m u n ity sh o u ld
receive assistan ce from it.
6N in e te e n o u t o f th e tw e n ty -n in e c o m p a n y u n io n s receiv ed su ch con trib u tio n s.
6T h u s o n e c o m p a n y a cted a s a b an k er for th e b en efit fu n d , lo a n in g it a n y su m s n e ed ed to tid e it over
u n til th e n e x t p a y m e n ts w ere d u e from th e m em b ers. A n o th er c o m p a n y p ro v id ed a ch eck -off from th e
p a y roll for r ep a y m e n ts to a lo a n fu n d a d m in istered b y th e c o m p a n y u n io n .
T h e fin an cial in terrelation s b e tw e e n th e c o m p a n y u n io n ’s b en efit featu res a n d th e c o m p a n y w ere n o t
a lw a y s clea rly p resen ted . O n e org an ization p rim a r ily con cern ed w ith b en efit featu res ap p ea red from
its c o n stitu tio n to b e e n tir e ly self-fin an cin g, a n d n o reference to m a n a g e m e n t su p p o rt ap p ea red in a n y of
th e n u m erou s sta tem e n ts issu ed b y th e c o m p a n y u n io n com p arin g its b en efits w ith th o se o f th e c o m p etin g
trad e u n io n ; y e t all th e p erson s in ter v iew e d freely sta ted th a t th e c o m p a n y m a d e good a n y d eficits an d
th ere w ere a lw a y s deficits.
i
T w e lv e o u t o f tw e n ty -n in e w ere, w ith o u t d o u b t, a lm o st e x c lu siv ely b en efit association s, an d in th ree
oth ers th e b en efit featu res w ere a n im p o rta n t e lem e n t in th e life o f th e c o m p a n y u n io n .
WELFARE AND BENEFIT ACTIVITIES
183
Although the constitutions ascribed other duties to them, they were
not active in any other field. In three instances the company union
furnished a well-rounded system of provisions against sickness,
accident, disability, death, and temporary financial need. In the
remainder the benefit program was more limited.
Of the 29 company unions furnishing some form of benefits, 18
were in organizations with optional membership and the others in
company unions with automatic participation. In 11 cases with
optional membership, the company contributed to benefit features
which were made contingent upon membership in the company
union.8 In one instance, the company at one time had a benefit
provision under which employees automatically became members of
the company union in signing for the insurance. In response to pro
tests by a trade-union in the plant, the benefit features were made
voluntary and separate from company-union membership.
8B en efit features m a y affect th e a ttitu d e o f th e in d iv id u a l e m p lo y ee tow a rd s th e c o m p a n y u n io n .
W here th e b en efit features are d eem ed v a lu a b le b y th e em p lo y ee, th e y m a y , as in th e case o f so m e tradeu n io n s, b eco m e a m ea n s o f b in d in g h im to th e organ ization to th e exclu sio n o f a n y oth er rep resen ta tiv e
a g en cy . T h e receip t o f th e b en efit m a y b ecom e associated w ith th e c o m p a n y u n io n as a n a d v a n ta g e
flow in g from its existen ce or from m em b ersh ip in it. T h e effect o f th is u p o n th e a ttitu d e o f th e in d iv id u a l
em p lo y ee s w ill v a r y so m ew h a t w ith th e ty p e o f c o m p a n y u n io n .
In th e case o f o p tio n a l m em b ersh ip , th e b en efit features m a y serv e as a n in d u c e m en t to jo in or rem a in
a m em b er o f th e c o m p a n y u n io n . In th e case o f a u to m a tic p a rticip ation , th ese features m a y in flu en ce th e
em p lo y ee to op p o se th e rep lacem en t of th e c o m p a n y u n io n b y a n y oth er form o f bargain in g ag en cy , if th is
rep lacem en t im p lies th e d isa p p earan ce o f th e b en efits. T o th e e x ten t th a t th e c o m p a n y co n trib u tes to
or o th erw ise su p p o rts th e b en efit features of th e c o m p a n y u n io n , it m a y in d ir e ctly in flu en ce th e e m p lo y ee s’
ch oice o f a rep resen tative ag en cy .
In a b o u t 10 cases m a n a g em en t co n trib u ted fin a n cia lly to recreational or social a c tiv ities o f th e co m p a n y
u n io n . T h e effect of su ch co n trib u tio n s m a y b e sim ilar to th a t o f co n trib u tio n s to b en efit fu n d s, a lth ou gh
less im m ed ia te an d m ore lim ite d w ith resp ect to th e n u m b er o f p eo p le w h o m a y b e in flu en ced b y it.
Chapter X X
Contacts Between Company Unions
The economic problems confronting any industry transcend shop
boundaries and local areas. The modern corporation may have
branches and subsidiaries extending across a continent and covering
processes from the extraction of raw materials to final sale of fabri
cated products. The problems confronting any particular business
firm are frequently common to all competitors in the same industry.
So also the workers have an interest in the problems of competitive
markets, for wage rates in individual establishments must necessarily
have regard to competitive conditions. These common problems
have led to the creation of industrial, regional, and national associa
tions of employers and, in the field of labor, to national trade-unions
and local, State, and national federations of unions.
Most of the companies involved in this study had several plants.
Yet less than 10 percent of the company unions operating in such
companies 1 maintained regular contacts with employee representa
tives in other plants of the same company.2 Among those that did
cover all plants of the company, the majority confined their member
ship to workers in a particular occupation. A few others confined
their contacts to plants in a single area, although the same company
had plants in other areas. Two covered all workers in all plants,
which were widely separated.
Most of the companies covered had close intercorporate relations
with other companies. However only five company unions extended
beyond the immediate corporate lines to cover wholly owned sub
sidiaries as well as the parent corporation.3 In one instance, employee
representatives raised the question of federating with company
unions in other subsidiaries of the parent holding company. The
local management said the matter would have to be referred to the
officials of the parent company. Nothing came of the request.
1 E ig h t c o m p a n y u n io n s cov ered m ore th a n 1 p la n t, a lth o u g h 89 of th e com p a n ies h a d m ore th a n 1 p la n t.
In a d d itio n th er e w ere se v e n cases o f r eta il or d istr ib u tiv e b u sin esses in w h ic h th e co m p a n y u n io n covered
a ll th e u n its in a sin g le c ity . In six cases in fo rm a tio n o n th e n u m b er o f p la n ts w a s lack in g .
T w o c o m p a n y u n io n s p r o v id ed in th eir c o n stitu tio n s for in ter p la n t cou n cils o f em p lo y ee rep resen tatives
b u t th e ev id e n c e in d ic a te d th a t th ese co u n cils h a d n o t fu n ctio n ed .
2I n a d d itio n to th o se w ith form al a n d regular in ter p la n t con ta cts w ere tw o cases in w h ic h em p lo y ee
r ep resen ta tiv es from sev era l p la n ts h a d m e t a t lea st on ce. In eig h t oth er c o m p a n y u n io n s in form al an d
irregular in ter p la n t co n ta c ts b y e m p lo y ee rep resen ta tiv es w ere rep orted . In o n ly h a lf o f th ese eig h t cases,
h o w e v e r , w a s th ere in d ic a tio n th a t th e co n ta cts h ad a n y rela tio n to d iscu ssion s of w ag es, hou rs, an d w ork in g
c o n d itio n s.
3N in e ty -six o f th e on e h u n d red an d tw e n ty -fiv e co m p a n ies stu d ie d h a d close corporate co n n ectio n s w ith
o th er co m p a n ies, or form ed p art of a h o ld in g -co m p a n y ch a in of corporations. In n in e cases n o in form ation
o n corporate c o n n ectio n s w a s av a ila b le. In form ation o n in tercorp orate rela tio n s w a s o b ta in ed from th e
in ter v iew s an d from th e sta n d a rd in v e stm e n t m an u als.
184
CONTACTS BETWEEN COMPANY UNIONS
185
Six company unions had made definite attempts to meet with
representatives of company unions in other companies.4 The chair
man of the company union visited other companies in two instances.
In one case there was a county association of workers engaged in the
same industry with regular quarterly contacts between four company
unions. Another company union sent employee representatives to
an annual regional conference on industrial relations which was not
solely or even primarily for employee representatives. A fifth sent
a committee to another plant to study the vacation plan. A sixth
wrote to other company unions regarding their attitude on the pending
National Labor Relations Bill.
None of the company unions studied belonged to a general fed
eration of company unions for its specific industry.5 A total of
several hundred persons interviewed were asked their opinion as to
the desirability of regional or national federations of company unions
for each industry. More than half felt that such a federation would
be undesirable, while a third considered it desirable. The remainder
were undecided or had never thought about the matter.
There were significant differences, however, between the trend of
opinion among the different groups interviewed. Trade-union mem
bers and officials had the most decided views on the matter and by
far the largest proportion— over three-fourths— considered it unde
sirable. They were afraid that such a federation “ would mean
employer domination of labor nationally.” “ Employers would
dominate the federation just as they dominate the individual com
pany union.” Among those who thought such a move might be
desirable, one thought that it would make the existing labor organi
zation “ wake up and recognize the change that’s taking place.”
Another felt that such a federation “ might separate the management
from the company union.”
Management, too, showed a general opposition to the federation
of company unions. Nearly three-fifths of the company officials
interviewed considered it undesirable. Some said they had no
opinion, but about a fourth thought a federation desirable. The
predominant management view was reflected in the frequently reit
erated statement: “ Our problems are entirely different from those in
other plants. The employees of other plants have nothing in common
4 A few o th er c o m p a n y u n io n s rep orted ch an ce or inform al m eetin g s w ith em p lo y ee rep resen tatives from
o th er c o m p a n y u n io n s. T h ere w a s n o in d ic a tio n th a t th ese c o n ta cts h a d a n y rela tio n to or in flu en ce u p o n
th e fu n ctio n in g o f th e c o m p a n y u n io n .
8S o m e c o m p a n y u n io n s, n o t in c lu d e d in th e field stu d y , cov er m ore th a n on e c o m p a n y in th e sa m e in d u s
try , in th e sa m e area. T h e L o y a l L egio n o f L oggers an d L u m b erm en , th e A m erican G u ild o f th e P rin tin g
In d u str y in B a ltim o re, th e E d itio n B o ok b in d ers o f N e w Y ork , th e G ra p h ic A rts In d u str ia l F ed era tio n
o f G reater B o sto n are ex a m p les of su ch organ ization s. (S ee p t. I, p . 15; p t. II , p . 73.) M o re r ec e n tly
c o m p a n y u n io n s in so m e oth er in d u stries h a v e sh o w n ten d en cies to federate w ith c o m p a n y u n io n s in
other com p an ies.
1 54 8 7 5 °— 38--------13
186
CHARACTERISTICS OF COMPANY UNIONS
with ours.6 It is enough for us to work out our own problems— let
alone having problems of other companies to annoy us. We do not
want the outside world to know of our affairs.”
Among the small group of management officials who favored a
federation of company unions, two views were most commonly
expressed. One group believed that such a federation might be better
able to fight the trade-unions. One personnel manager said: “ If
the Government tries to force American Federation of Labor unions
on the industry as the collective-bargaining agencies, such a federa
tion will be established.” Three or four management officials felt
that such a federation might be useful in setting standard wages for
the industry:
Employers have their organization; employees should be organized vertically
throughout the whole industry. We would then have a responsible unit repre
senting labor and one representing employers. This would help stabilize labor
conditions. I will not deal with outside unions but I believe in workers organizing
themselves into a responsible federation of company unions.
Among the employee representatives, the people directly responsible
for the functioning of the company unions, there was an even division
between favorable and unfavorable views. Some who opposed a
general federation favored one covering all plants of the company
itself. The ends desired by those who favored a wider federation
were to get information, guidance, and ideas: “ We are all green.”
“ We could get new ideas. We would understand the general problems
of labor. We would know the general trend of wages and hours
and what other mills are doing.” In only a few instances did employee
representatives state that such a federation would strengthen their
bargaining position. Some felt that it would help to standardize
wages and improve competitive conditions. The minutes of a meet
ing of one general council, representing seven plants of one of the
strongest and most independent company unions, indicate that
some of its representatives felt restricted by their inability to regulate
conditions in more than one company. Thus, in a discussion of a
proposed wage increase, one employee representative asked if all
manufacturers of the product could not be put on the same basis.
This, he stated, was on the mind of many employee representatives
when they considered the wage-increase proposal.
Rank-and-file workers that favored federation laid most stress on
the possibility of obtaining a stronger bargaining position.
Employee representatives and rank and file who opposed a federa
tion, as a rule either took the same view as management about the
special character of the problems in individual plants or feared outside
control of their activities.
6T h is em p h a sis u p o n th e p e c u lia r ity o f th e p rob lem s o f each p la n t con trasts w ith th e im p o rta n ce ascribed
b y m an a g em en t officials to th e w ag es paid, b y com p etito rs in se ttin g w ag e le v e ls. O f th e m a n a g em en t
officials w h o stressed co m p e tito r s’ w a g es, le ss th a n h a lf felt th a t a fed eration o f c o m p a n y u n io n s m ig h t b e
d esirab le as a m ean s o f sta n d a rd izin g w ag es for th e in d u str y .
Chapter X X I
Contacts With Government Agencies
Company unions have paid little attention to legislation affecting
their members or involving the structure and functioning of their
organizations. Thus, while employers and employers’ associations,
trade-unions, and others appeared at N. K. A. hearings where codes of
fair competition were inaugurated, only 13 percent of the company
unions then in existence 1participated in any way in the formulation of
codes. A few others discussed the act in company-union meetings
without participating in code hearings.2 The remainder made no at
tempt to discuss these codes or to influence their provisions. All of
the company unions that sent representatives to hearings were in
companies with 1,500 employees or more, and all but 3 were estab
lished before 1928.3
Similarly the Wagner bills 4 of 1934 and 1935, to set up a National
Labor Kelations Board, contained provisions seriously affecting
company unions. Many employers and representatives of employers’
associations testified that the bill meant the end of the company
unions in their plants. Yet only four of the company unions studied
made any public statement in connection with the 1934 Wagner bill
hearings.5 The 1935 hearings evoked public statements from these
and six others.6 There was some discussion over this bill in council
1Of th e 76 c o m p a n y u n io n s stu d ie d w h ic h w ere in ex isten ce w h e n th eir cod es w ere form u lated , 8 sen t
rep resen ta tiv es to te s tify or p resen t briefs to th e origin al h earin gs a n d 2 oth ers to h earin gs o n a m e n d m e n ts.
2O n e c o m p a n y u n io n d rafted a n ap p ea l to th e cod e a u th o rity for r ev isio n o f th e cod e p ro v isio n on ov er
tim e , so as to p erm it th e av era gin g of o v ertim e ov er a 6-m on th p eriod in ste a d o f o n ly a 30-day period. T h e
oth ers, so far as th e records sh o w , m a d e n o a tte m p t to p resen t th eir v ie w s to th e go v ern m en ta l a u th o rities
con cern ed .
3In six cases th e c o m p a n y p a id all or m o st o f th e exp en ses for se n d in g co m p a n y -u n io n d elegates to th e
h earings. In th ree in sta n ces th e exp en ses w ere p a id o u t o f th e co m p a n y -u n io n treasu ry; an d in an oth er
b y a collectio n ta k e n u p am o n g th e m em b ers.
* P u b lic R e s. 44, 73d C on g ., a n d P u b lic R es. 198, 74th C ong.
5T w o se n t rep resen ta tiv es to th e h earin gs w h ile tw o oth ers se n t p rotests a g ain st th e b ill to v a riou s p u b lic
officials concern ed.
6In a ll, four se n t rep resen ta tiv es a n d fiv e filed briefs or p e titio n s a g ain st th e b ill. T h e ch airm an of an oth er
c o m p a n y u n io n w e n t to W a sh in g to n d u rin g v a c a tio n a n d sa w so m e m em b ers of C ongress ab o u t th e b ill
b u t d id n o t te stify a t th e h earin gs or su b m it a brief.
O n e c o m p a n y u n io n w h ic h , in th e w o rd s o f a n official o f th e c o m p a n y , w a s itse lf “ a n in fo rm a tiv e, n o t a
n e g o tia tin g b o d y ” , se n t p e titio n s, 5 of th e m c o n ta in in g 330 n a m es ea ch , to th e P re sid e n t o f th e U n ite d
S ta tes, th e S ta te ’s S en ators, an d 6 C on gressm en , in op p o sitio n to th e 1935 W ag n er lab or rela tio n s b ill.
T h e p e titio n sta ted :
“ R e ce n t G o v ern m en t p o lls seem to in d ica te th a t th e v a st m ajo rity o f w orkers prefer to h a n d le (as w e do)
th eir lab or p rob lem s d ir e ctly w ith th eir em p loy ers.
“ I t ca n n o t b e p o ssib le th a t y o u c o n tem p la te th e d estro y in g o f su ch organ ization s as ou rs rep resen ts, b y th e
p a ssin g o f b ills w h ic h w o u ld e lim in a te efficien t coop eration or m a k e im p o ssib le th eir e x iste n ce .”
187
188
CHARACTERISTICS OF COMPANY UNIONS
meetings of company unions which did not make public statements.7
One committee refused to take a stand against the bill because it
might want help from the American Federation of Labor sometime
in the future.
In no case studied did the company union pay for the appearance
of its representatives at the hearings on the Wagner bill, although one
employee representative apparently paid his own way to testify at
the hearings.8
Such public statements as were made opposed the adoption of the
Wagner bill. Opposition was principally directed to the provision
forbidding employers from participating in the functioning of organi
zations of their employees with which they might engage in collective
bargaining. Representatives of company unions claimed that partici
pation by the employer in its activities improved its relations with
the employer and its effectiveness as an agency for the promotion of
the welfare of the employees. They attacked particularly what they
called the conflict aspect of trade-unionism. The brief of one
company union, signed by the management representative as chair
man of the council, opposed the bill on the ground that it would
foster a “ closed shop.” Similarly the county federation of company
unions, referred to in the preceding chapter, adopted the following
resolution:
Especially are we opposed to the rider 9 wherein it proposes to make law that
if the local union has obtained a majority o f the employees of any mill as members,
the balance of the employees are required to become members of the local union
and the mills to operate as closed shops.
Company unions studied were also relatively inactive in cases
brought before the various labor boards established under the N. R. A.,
although many of them were directly or indirectly involved in such
cases.10 Where company-union representatives appeared in cases
involving trade-unions, they consistently opposed the trade-union.
But the general picture gathered from the data available indicates
that company unions played a passive rather than an active role in
labor-board cases. Although they were the object of trade-union
attack and the basis of the employer's defense in many of the cases,
they did not themselves play an important part in the proceedings.
7 T h ree c o m p a n y u n io n s d iscu ssed th e m atter; tw o o f th ese to o k n o a ctio n , w h ile th e th ird w r o te to oth er
c o m p a n y u n io n s for th eir a ttitu d e o n th e b ill.
s I n o n e case th e c o m p a n y p a id th e ex p en ses d ir e ctly , in an oth er th e c o m p a n y co n tr ib u te d $600 a m o n th
to th e trea su ry o f th e c o m p a n y u n io n . O u t o f th is su m th e c o m p a n y u n io n p a id its exp en ses, in clu d in g
th o se o f th e w itn e sses a t th e h earin gs. In th e th ird case th er e w a s n o sp ecific in fo rm a tio n as to th e sou rce
o f p a y m e n t, b u t th e c o m p a n y u n io n h a d n o d u e s or o th er so u rce o f fu n d s an d th e gen eral exp en ses o f th e
c o m p a n y u n io n w ere d efra yed b y th e co m p a n y .
8T h ere w a s n o su c h rider or p ro v isio n in th e a ct, th e reference b ein g a p p a r en tly to th e p ro v isio n th a t th e
m a jo rity sh a ll h a v e th e r ig h t to b argain for a ll w ork ers in th e p a rticu lar u n it.
*0 F o r ty p ercen t o f th e c o m p a n ies stu d ie d w ere a t o n e tim e or a n oth er in v o lv e d in cases before G o vern
m e n t lab or board s. T w e n ty -o n e o f th e c o m p a n ies w ere in v o lv e d in cases con cern in g r eco g n itio n o f th e tradeu n io n a s th e b a rg ain in g a g e n cy , w h ile 37 w ere ch arged w ith d iscrim in a tio n a g ain st tra d e-u n io n m em b ers.
E ig h t w ere in v o lv e d in b o th ty p e s o f cases.
CONTACTS W ITH GOVERNMENT AGENCIES
Jg9
Even in election cases the employer rather than the company union
bore the brunt of the defense.11
One company union was active in a strike situation and subsequent
labor-board hearings. It issued printed pamphlets and prepared
petitions attacking striking trade-union members and comparing
trade-union benefits and fees with those of the company union.
These, however, were prepared not by the employee representatives
themselves but by the full-time secretary, who was hired by the
company and was dependent on the company for her pay.12
A few of the company unions studied initiated action in labor-board
cases. In two cases they brought charges against their employers
that code wages and seniority rules were not being observed. A third
company union considered such action but decided against it. Three
company unions petitioned for elections, one after a trade-union had
obtained a majority in a preceding election. One of these petitions
was circulated after the employer had requested such an election.
The circumstances led the board to doubt the spontaneity of the
petition. Four company unions sought advice from the regional
labor board with respect to the form and legal status of their organi
zation.
The minutes of council meetings 13 report little discussion of other
legislation, State or Federal, or of any other subject extending beyond
the confines of the plant. Four company unions discussed either
general or particular aspects of social insurance. Three considered
the 30-hour bill. The tariff, the processing tax on the company's
raw materials, the sales tax, unemployment relief, and local property
taxes were among the matters discussed by one or another company
union. Two participated in hearings on State laws regulating their
industry, one taking a stand opposed to that of the trade-union.
Insofar as outside matters were discussed, they tended most often to
be talks by management representatives on the state of their business
and their industry.
Such political activity as was undertaken was frequently stimulated
by management.14 Management attitudes on pending legislation
were presented to the councils or the workers and frequently a line
of action was suggested. Thus a joint committee that had never
considered grievances or wage questions was used by management
F or reference to a strik e b y a co m p a n y u n io n ag ain st a labor-board ru lin g, see ch. X V I , p . 160.
co m p a n y m a d e good th e p eren n ia l d eficits o f th e c o m p a n y u n io n . A lth o u g h th e c o m p a n y itse lf
m a d e n o ap pearan ce a t th e labor-board h earings, officers o f th e co m p a n y u n io n w ere p resen t to ta k e d o w n
th e n a m es o f all w orkers p resen tin g affid avits.
13 F or th e in clu siv en ess of th ese m in u tes see ap p en d ix V , p . 288, fo o tn ote 7.
i* A n ex cep tio n to th is c o n d itio n w a s th e case of on e co m p a n y u n io n , in a c o m m u n ity w ith stron g lab or
an d so cia list se n tim en t, w ith a n u m b er of trad e-u n ion m em b ers on th e com p a n y -u n io n cou n cil. T h e cou n cil
p a ssed a resolu tion favoring th e 30-hour w e ek p rin cip le, a lth ou gh a m o tio n to sen d th e resolu tion to C ongress
a n d th e S ta te legisla tu re w a s defeated . T h is co u n cil also ob ta in ed p erm ission to circu la te p e titio n s in
favor o f th e T o w n sen d p la n . T h e p e titio n s w ere m im eogra p h ed b y th e c o m p a n y a n d th o u sa n d s of sig
n a tu res w ere o b ta in ed , p a rtly o n c o m p a n y tim e.
12 T h e
190
CHARACTERISTICS OF COMPANY UNIONS
to convince the representatives that they should be against the
Wagner bill and to show them, through figures on the national debt,
that the country was being led to bankruptcy. One company union,
in addition to sending numerous petitions against the Wagner bill,
sent petitions against the Black-Connery 30-hour bill, and the central
unemployment insurance proposal. The impetus to this political
activity came from the president of the company. Through the
house organ and through addresses to meetings of the workers, he
urged them to protest against these laws.
Chapter X X II
Coexistence of Company Unions and Trade-Unions
Developments between 1933 and the time of the study (1935) made
far more common situations in which company unions and tradeunions coexisted in the same plant. The study throws light on the
problems that arise when two such forms of organization are present.
In nearly three-fourths of the 125 plants visited, trade-union locals
or active trade-union members were reported to be present at the
time.1 In most of these cases the trade-union received no official
recognition from the company.2 About 30 percent of the companies
at the time of the study dealt with one or more trade-unions as well as
with the company union.
The form of dealing with the trade-union in such cases ranged from
occasional conferences on specific matters to written agreements
signed by both parties. Where employers met with trade-union
committees, they generally recognized such committees even though
some of its members were not employees. A few agreed to meet only
with committees of trade-union members composed of their own em
ployees. One very large firm with chain units throughout the country
received committees of its unionized workers as representatives of the
company's employees and not of the trade-unions. One large
corporation with many branches refused to sign a contract with any
trade-union, but followed in many plants wage-and-hour provisions
which it had agreed upon in negotiations with the trade-union.
The conditions under which dual organization existed varied as
regards the priority and extent of the two or more organizations. In
10 plants in which a craft union had functioned for some time before
March 1933 a company union was established, following the passage
of the N. I. R. A., to prevent the organization of the remaining workers
into a trade-union. In other cases trade-unions developed under
N. R. A. in plants where company unions had long existed. In still
others, both trade-unions and company unions first began to operate
after March 1933.
1U n su c c essfu l a tte m p ts to esta b lish tra d e-u n io n s w ere rep orted in oth er cases. T rad e-u n ion m em b ers
m a y h a v e w ork ed a t oth er p la n ts, b u t th eir p resen ce w a s n o t m a d e k n o w n to th e field ag en t. F or a d iscu s
sio n o f m e th o d s u se d b y va riou s com p a n ies to p r e v e n t th e e sta b lish m e n t o f a tra d e-u n io n a n d to prom o te
th e se ttin g u p o f a c o m p a n y u n io n in ste a d , see ch s. V I, V II, a n d V III.
2In at least 12 such cases th e trade-union m em bership included a significant proportion and in a few cases
a m ajority of the em ployees.
191
192
CHARACTERISTICS OF COMPANY UNIONS
In a number of cases the trade-union covered only a single craft
comprising a small proportion of the total employees. In one in
stance only the 4 teamsters were covered by a trade-union agreement;
in another an agreement covered only 35 truck drivers out of a total
of 2,500 employees. In some such instances the company union
made no attempt to include the unionized crafts or occupations. In
two printing plants a company union displaced the trade-union in a
single craft while the other crafts remained unionized. In a public
utility in which the linemen were unionized, the company union was
confined to the operating force. A company union at an airport
covered only the mechanics, the operating force being unionized. In
an oil company in which the refinery workers were in a trade-union,
the company union covered the field force only. But in general where
company unions were set up in establishments with trade-unions
already long entrenched in certain crafts, the company union covered
all types of workers.
In a majority of cases, however, the trade-unions concerned were
federal labor unions 3 or locals of industrial or semi-industrial unions.
They did not confine themselves to a single craft or occupation but
made a bid for the membership of all or almost all of the employees.
In such instances there was an almost complete overlapping of
jurisdiction between the trade and company union.
The rivalry of organization at the time of the study was not confined
to a direct choice between a given trade-union and the company union.
In some instances, two and even three trade-unions were attempting
to organize the same category of workers. Usually one was an
affiliate of the American Federation of Labor, while the other or others
were locals of a national organization not affiliated with the American
Federation of Labor or independent locals.
In one company, some workers started a local independent union,
others joined a national independent union, and still others joined the
American Federation of Labor union. This three-fold rivalry resulted
in friction and dissension. The company in the meantime encouraged
and supported the company union. In another instance, the strongest
trade-union group was independent of the American Federation of
Labor, and had socialist leanings. There was also a communist nu
cleus which, having failed in an attempt to organize a union, was
issuing a mimeographed sheet supporting the independent union, but
also criticizing it. The third union, which was affiliated with the Amer
ican Federation of Labor, had the highest dues. The company union
had the lowest dues and its leaders used the confused trade-union
situation as the chief reason for remaining aloof from trade-union
organization. In another case, the situation was complicated by tense
3 A lo c a l u n io n h a v in g n o co n n ectio n w ith a n a tio n a l or in tern a tio n a l u n io n b u t affiliated d ir e ctly w ith th e
A m erican F ed era tio n o f L abor.
C O E X IS T E N C E O F C O M P A N Y U N IO N S A N D T R A D E -U N IO N S
I
93
rivalry between a number of trade-unions, the existence of a company
union, and the establishment of a collective-bargaining agency by the
special labor board for the industry.
Such interunion rivalries have always been more acute in the poorly
organized industries and areas. These rivalries tended to confuse
the workers, thereby weakening the trade-union in its attempts to
overcome the company union.
Trade-union policy in competitive situations.— Trade-unions as a
general rule fought the company union and attempted to secure
recognition and a written agreement.4 A few strong craft locals
ignored the company union, contenting themselves with protecting
their control over their own jurisdictions. As might be expected,
because of the more direct competition for members, federal labor
unions and locals of industrial or semi-industrial trade-unions tended
more generally to oppose and compete with the company union for
membership and recognition. Such inclusive unions, when strong,
avoided any cooperation with the company union.
In a few instances weak trade-union locals claiming an inclusive
jurisdiction attempted to control the company union in order to
sabotage its work. The purpose of such tactics was described by one
employee representative as follows:
As trade-unionists, we take part in company-union activity so as either to get
the men interested in the trade-union or the company disgusted with the com
pany union.
In one case, a semi-industrial trade-union local captured half of the
employee-representative positions in the first company-union election.
It was strong enough to prevent the company-union committee from
proceeding with the task of drawing up a constitution. In the second
election, the trade-union obtained eight out of nine seats on the com
mittee, which became in effect a trade-union committee although
management refused to recognize it as such.
Craft unions in some cases attempted to gain advantages through
cooperating with or controlling the company union. Some strong
craft unions sought not only to maintain recognition as the bargaining
agency for their own craft, but also worked within the company union
to obtain certain other benefits. Several, for instance, cooperated
with the company union in its social and athletic activities. In one
company several craft unions, some operating under trade-union
agreements, elected their own members as company-iftiion representa
tives. In another, a group of craft unions which had a joint bargain
ing committee recognized by management attempted to convert the
company union into a trade-union mechanism by running a joint
trade-union slate of candidates in the company-union election. In
4 T h is w a s th e a ttitu d e of th e tra d e-u n io n in n ea rly tw o -th ird s of th e cases in w h ic h a c o m p a n y u n io n
an d tra d e-u n io n ex isted in th e sa m e esta b lish m e n t.
194
CHARACTERISTICS OF COMPANY UNIONS
one election they succeeded in electing 9 of the 20 employee repre
sentatives.
In two cases in which craft and industrial or semi-industrial tradeunions existed in the same plant, the craft unions cooperated with the
company union while the more inclusive organization opposed the
company union and tried to displace it. In one company, two crafts
were strongly organized in their appropriate American Federation of
Labor trade-unions, while an independent5 industrial union also
operated in the plant. The presidents and some of the members of
the craft locals were company-union representatives, although they
did not take an active part in the council. Committees of these two
craft unions were received by management for negotiation, not as
trade-union committees, but as representatives of some of the em
ployees. The independent union actively opposed the company
union. Its members refused to serve as representatives. Manage
ment conferred with a committee from this union as a trade-union
committee.
In another company the difference in attitude was a matter of
strategy and jurisdictional interests. A craft union had been dealing
with the company for 10 years but had no contract. The craft union,
although it covered only a minority of the workers, decided to gain
control of the company union when it was first established. Its
members gained a majority of the positions as representatives in the
company union, and the chairman of its shop committee was also
president of the company-union council. One of the purposes of the
craft union was to organize into another American Federation of
Labor union the semiskilled and unskilled workers whom they could
not take into their craft organization. The federal labor union thus
established, having grown considerably in membership, was at the
time of the study attempting to displace the company union.
Although it did not direct its members to abstain from voting in com
pany-union elections, it ignored the company union and used its own
committees for bargaining. The craft union continued to participate
in the affairs of the company union.
Individual trade-union members often became members of the
company union or voted in company-union elections, even when the
trade-union actively competed with the company union for recogni
tion. In one case this was done to protect seniority rights.
In other cases it was a means of obtaining benefits provided by
the company unions. In still other cases it was a protective device
to forestall possible discrimination or discharge. This was especially
so in about 10 instances in which the trade-union organization had
been broken by attacks from the company or where the trade-union
local had been displaced by the company union and had disappeared.
5 N o t affiliated w ith eith er th e A m erican F ed era tio n of L ab or or w ith an u n a ffilia ted n a tio n a l u n io n .
COEXISTENCE OF COMPANY UNIONS AND TRADE-UNIONS
^95
Operation under conditions oj competition .— In the competition be
tween a company union and a trade-union covering only a certain
craft or occupation, it was possible for the two organizations in some
cases to establish a more or less stable basis of coexistence. The trade
union retained effective control of its portion of the workers; the com
pany union, although nominally covering all workers, in effect acted
only for those not covered by the craft union. The trade-union
members may or may not have participated in some of the companyunion activities, but their basic conditions of work were settled by
trade-union negotiation.
On the other hand, competition between two organizations each of
which claimed all or a majority of the workers and one of which was
favored by the employer, admitted of no compromise or cooperation
in most cases. The coexistence of a company union and an industrial
or semi-industrial union frequently represented therefore an unstable
condition which resulted in eventual domination by one and practical
disappearance of the other.6
Where a company union and a trade-union competed within the
same plant, the former generally possessed certain strategic advan
tages. Company unions and employers featured the fact that there
was no cost to the workers, or that dues were small as compared to
those charged by trade-unions.7 Equal treatment by management of
a trade-union and the company union operated to the advantage of
the latter, which seemed to offer the same protection as the tradeunion without its dues. Thus one trade-union official complained
that most of the workers, being unfamiliar with labor-organization
procedure and practice, failed to distinguish between a company
union and a trade-union. They therefore turned to the one which
cost little or nothing.
Invariably, when a company union and a trade-union competed,
the employer preferred the company union. This preference was
shown in a number of ways, in some cases involving the mere expres
sion of an opinion, in others involving open and determined partici
pation in the competition. Such participation itself ranged in method
from efforts to increase the prestige or effectiveness of the company
union to bitter attacks on the trade-union. Thus the personnel
department of a large chain-store concern nursed its company union
by coaching the representatives in the kind of demands to make and
the opportune time to make them. In another case, the company
union was closely watched and guided in its contest with the tradeunions. In this case, as in many others, the plant manager knew
more about the constitution and procedure of the company union than
6In th is co n n ectio n it is in terestin g to n o te th a t b e tw e e n th e tim e th e s tu d y w a s m a d e a n d th e p u b lica tio n
o f th is rep ort (M a y 1937) n ew sp a p er rep orts an d lab or-board ru lin g s in d ic a te d th a t m a n y of th e co m p a n y
u n io n s h a d b e e n d isp la ced b y a tra d e-u n io n .
7 See ch. X I for d iscu ssion o f c o m p a n y -u n io n d u es an d finances.
196
CHARACTERISTICS OF COMPANY UNIONS
did most of its officers. The general manager of one firm which for
merly had only a company union complained that the dual arrange
ment was not as effective in handling grievances. He used this as an
argument for returning to the original situation wherein the company
union functioned exclusively.
Outright grants of privileges and concessions to the company union
and not to the trade-union were at times the means of building up the
strength of the company union.8 Six companies had granted a check
off of dues to the company union, but not to the trade-union locals
which also existed.9 In some instances company-union representatives
secured quicker adjustment of grievances than trade-union repre
sentatives. Trade-union representatives in one company found diffi
culty in securing interviews with management, although companyunion representatives had no such difficulty. In another case, the
company union, which covered only one craft, obtained a signed
written agreement with the company. The remaining crafts, at least
one of which was well organized in a trade-union, were subsequently
granted the same conditions by a unilateral statement by the company.
Other tactics were used to weaken the trade-union. The gains
secured by the trade-union were belittled. When both the tradeunion and the company union made demands simultaneously, manage
ment sometimes first granted the request of the company union and
only later did it acknowledge the trade-union demands. In one such
case management submitted a wage agreement to the trade-union
after it had been ratified by the company union. In two cases the
company, after consultation with the trade-union, issued a unilateral
statement with respect to wages, hours, and working conditions.
Issued as a statement from the company, it did not mention the
negotiating agency and permitted the company union as well as the
trade-union to claim credit for the gains.
At times the company pleaded the law as a reason for not dealing
with the trade-union. Sometimes it stated to the trade-union that
it was already bargaining collectively with the company union and
therefore would not recognize a second group. In a few cases, after
holding a company-supervised election in which the decision was for
the company union, it refused to receive a trade-union committee,
stating that it was obligated by law to deal exclusively with the
representatives of the majority.10
s T h e u se of b en efit p rov ision s an d social affairs fin an ced in w h o le or in p a rt b y th e c o m p a n y , to m a k e
c o m p a n y -u n io n m em b ersh ip m ore a ttra ctiv e th a n tra d e-u n io n m em b ersh ip , h a s a lread y b een d iscu ssed .
(S ee ch . X I X .)
9T h ere w ere th ree oth er cases o f ch eck -off in p la n ts in w h ic h a tra d e-u n io n h a d on ce c o m p eted w ith th e
c o m p a n y u n io n b u t n o lon ger ex isted . See ch . X I , p. 116.
10I t so m etim es referred sp ecifica lly to th e N a tio n a l L a b or K ela tio n s B o ard ru lin g w ith regard to m ajo rity
ru le in th e H o u d e case. (S ee a p p en d ix I, p . 226.)
COEXISTENCE OF COMPANY UNIONS AND TRADE UNIONS
197
Although employers preferred the company union, sometimes they
indicated that certain advantages accrued from the rivalry between
the two groups. A general manager of one firm stated that competi
tion with other labor organizations brought out the best in the men
who headed the inside association. On the other hand, the officials
of another company union and trade-union stated that they realized
that they were being played against each other. The leaders of
another company union stated that they were so incensed at the
policy of management in playing it against the trade-union that they
were seriously considering affiliating with other company unions in
the industry or with a trade-union.
In three of the cases studied, collective bargaining was attempted
not through the trade-union and the company union separately but
through a joint agency which was intended to represent the different
groups and views in the plant in proportion to their strength as re
vealed in an election.11 The machinery set up for collective bargain
ing under a system of proportional representation was based upon
the idea that company-union and trade-union representatives can
work together in the collective-bargaining process. However, the
friction and rivalry between the two organizations was not diminished
under proportional representation in the three cases studied. In
these instances collective bargaining through committees set up on a
basis of proportional representation proved disadvantageous to the
trade-unions. They therefore withdrew from the committees to do
their own bargaining directly with management, and the committees
became in effect company-union agencies.
This is illustrated by what took place in one of these companies
where a company-instigated organization appeared in the plant after
a trade-union had been organized. The trade-union, fearing that it
might be undermined, called a strike. The strike was settled under
an agreement to arbitrate the issues involved. The arbitrator’s
award, in addition to granting a 10-percent wage increase, established
a joint bargaining committee on which trade-union and company
union were proportionately represented. All decisions required a
two-thirds vote of the joint committee, and a three-fourths vote was
required to declare a strike. In the ensuing election to choose the
joint-committee members, the trade-union elected 12 candidates and
the company union 10. Both sides voted in blocks, and since the
company union had enough votes to defeat every trade-union pro
posal no action was taken on any complaint presented by the tradeunion. The trade-union finally withdrew from the joint committee
and returned to the practice of approaching the company directly.
11 In an oth er case th e c o m p a n y in sisted th a t it w o u ld bargain o n ly w ith a join t c o m m ittee o f th e co m p a n y
u n io n an d th e tra d e-u n io n , b u t reced ed from th is p o sitio n in th e face of a strik e th rea t.
198
CHARACTERISTICS OF COMPANY UNIONS
The attempt at proportional representation in the automobile
industry also failed, in the two cases studied, to result in a lasting
functioning of the two groups through a joint committee. In one
case, the trade-union, finding itself in a minority on the collectivebargaining agency, withdrew. The collective-bargaining agency
thus became in effect the agency of the company union. Keen com
petition between the company union and the trade-union continued,
with the company union having the check-off and access to the bul
letin boards, privileges denied to the trade-union. In the other plant
the election resulted in the selection of 28 representatives for the com
pany union, 27 for the trade-union, and 17 unaffiliated representa
tives. From the outset the unaffiliated representatives sided with
the company-union representatives. Friction between the tradeunion and company-union representatives on the collective-bargaining
agency developed, and it was finally agreed that the two groups would
meet separately. Each group conducted its own conferences with
management, and the collective-bargaining agency as a joint body
practically disappeared.
Chapter X X III
Summary and Conclusions
Examination of a representative group of 126 company unions
indicates that their establishment was most frequently due to the
pressure of trade-union activity, either in the form of organization
drives or strikes in the trade or vicinity. Legislation and other
governmental action was also an important factor. Few company
unions were set up in the absence of such external influences.
The great majority of company unions were set up entirely by
management. Management conceived the idea, developed the plan,
and initiated the organization. In a number of cases one or more
employees played a part in the initiation of the company union. In
some of these, however, employee initiative was more apparent than
real. In some, the company accepted an employee’s suggestion that
such an agency be set up and then pushed through the organization.
In only a few instances, generally where a trade-union had failed to
win the confidence of the workers, was the organization set up pri
marily through the action of employees. Almost never was it
established without some assistance from management.
Where management set up company unions or supported their
establishment, it sometimes exerted no pressure other than stating its
own wish in the matter. More frequently, however, it applied vary
ing degrees of additional pressure, including in some cases discharge
of trade-union members and threats to close down the plant unless
the company union was established. Since in so many instances the
presence of a trade-union had inspired the movement to organize a
company union, one phase of the work of setting up a company
union was to attack the trade-union or to hamper it by delay and
manipulation.
The existence of a company union was almost never the result of
a choice by the employees in a secret election in which both a tradeunion and a company union appeared on the ballot. In a third of
the cases the employees were offered a chance to vote in secret election
in which expression of opinion was limited to a vote for or against
the company union. In some of these cases the company union was
set up even when the vote was in the negative. In another third,
199
200
CHARACTERISTICS OF COMPANY UNIONS
the company unions were installed without any expression of choice
by the workers, while in about an equal number of cases their choice
was registered by signature to a membership roll or petition, or by
open vote at a public meeting.
Company unions fall into two groups according to the basis on
which employees participate in the affairs of the organization. In
somewhat more than half, the right to participate followed automati
cally from employment by the company. Certain restrictions as to
age or period of employment may have existed, but, once these quali
fications were met, the employee was automatically free to vote and
participate in the affairs of the organization in whatever ways were
provided. In such situations there is no such thing as membership
in an employees’ association. There is, technically considered, no
association, but simply an agency for representation of employees in
their relations with management. As a corollary, such representation
arrangements very rarely have provisions for dues or for meetings
of the employees, although the latter is more commonly provided
than the former.
The second type of company union, comprising somewhat less than
half of the total, operated on a membership basis. In addition to
satisfying the essential requirement of employment by the company
and whatever other restrictions may be set up, such as age and length
of service, the employee must go through a more or less formal and
voluntary process of applying for and obtaining membership. This
type, which dated predominantly from the period since March 1933,
included almost all of the dues-charging organizations and the great
majority of those having general employee meetings.
All but a handful of the company-union constitutions either specifi
cally or by implication made management a party to the functioning
of the employees’ organization. Management could veto amendments
to the company-union constitution in a substantial number of in
stances and could terminate the life of the company union in a few
cases.
Most of the company unions studied relied entirely upon manage
ment for their finances. Many others received more or less important
financial assistance from the employer. Financial dependence upon
management generally meant that proposed expenditures by the
company union had to be approved by management. Less than 10
percent of all the company unions appeared to be financially selfsupporting. The rate of dues was in most cases considerably below
trade-union levels, and few of the company unions had substantial
treasuries. Almost all of the dues provisions dated from after March
1933.
Just as the company union was confined to employees of the com
pany, so its officers and representatives almost invariably had to be
SUMMARY AND CONCLUSIONS
201
employees. A few of the company unions had full-time salaried
officials. Some of these were paid by the company and all were former
employees of the company.
Except for these few cases, the affairs of company unions were man
aged entirely by persons whose jobs were subject to the good will of
management or to restrictions accepted by management. In order
to assure company-union officials against discrimination, many con
stitutions had provisions guaranteeing such officials against discrimi
natory treatment. There was little evidence of such discrimination
among the cases studied. Nevertheless, in many cases persons inter
viewed expressed fear of the possibility of such treatment or referred to
cases in which representatives had been afraid to act aggressively. While
such fears were less common among the older, well-established com
pany unions than among those set up more recently, hesitancy about
incurring the displeasure of foremen or management persisted even in
cases in which the company union had been functioning for a long time.
In view of the emphasis placed upon the company union as an
agency for adjusting individual grievances, it is significant that onethird of the company unions handled no such matters. According to
persons interviewed in company unions which did take up individual
grievances, approximately one-third of this group did so effectively,
another third with limited effectiveness, and the remainder ineffec
tively. The company unions which were effective in handling griev
ances included most of those with full-time officials as well as most of
those which showed some ability to negotiate with management
regarding wages. They also included a relatively large proportion of
companies with personnel departments.
Company unions were apparently most successful in the field of
health and safety work and in providing that available work be dis
tributed among all employees instead of being concentrated among
a few.
Company unions were less effective in handling general questions of
wages and hours than in handling other matters. In nearly half of
the cases no general wage increases were requested or negotiated by
the company union between January 1933 and July 1935. This does
not mean that there were no wage increases in these plants. Since it
was a period of rising prices and business improvement, some of these
concerns gave increases but the company unions played no part in
securing these increases.
Such wage adjustments as did take place following requests by
company unions were in most cases not a result of any process which
might be termed negotiation or collective bargaining. In some
instances, it appeared that the wage increase which management had
decided to make was announced through the company union in order
to increase the prestige of the company union. Many requests for
1 54 8 7 5°— 38--------14
202
CHARACTERISTICS OP COMPANY UNIONS
increases were refused by management without any negotiation,
management simply stating that conditions did not warrant an increase
or that wages were above those in other plants.
A small number of the company unions engaged in a procedure
which approximated negotiation. Some of these negotiations re
sulted in wage increases. Analysis of the internal structure and
strength of these organizations leads to the conclusion that their
aggressiveness was due to the activity of trade-union members within
the company union, or to encouragement by a management favorably
inclined toward the idea of a vigorous union of its own employees
but independent of outside affiliation.
In negotiations concerning wages and hours of work, company
unions were handicapped by a number of factors. Important among
these was their lack of knowledge of the financial condition of the
company and of comparative wage scales in the industry. They
lacked, in practically all cases, any regular contacts with company
unions outside their own plants. Most company unions had to rely
entirely upon the statement of the situation as it was presented by
management. Practically none of the company unions had hired out
side experts for assistance in negotiations with management. Most
of the organizations were not considered as possessing the right to hire
such assistance, while few of those which had the right possessed the
necessary funds.
The evidence indicated a reluctance on the part of company-union
officials to appeal matters from lower to higher management officials.
In some cases the officials who had authority to render the decision of
management were not directly connected with the particular plant
concerned. In these cases, conferences with the local management
could not be decisive. Pinal decision had to await action by officials
with whom company-union representatives did not come into direct
contact.
More fundamental was the company union’s inability to bring
any pressure upon the employer. In most cases aggressiveness could
take the form only of reiterated requests for consideration of the
petition of the company union. Practically all of the organizations
specifically or by inference disavowed the use of the strike and a
negligible number had funds sufficient to carry a strike for any length
of time. Only one of the company unions had called a strike to
enforce a demand. Only one-fifth of the company unions possessed
the right to demand arbitration, by disinterested outsiders, of matters
which could not be settled by discussion between management and
employee representatives. In none of the cases studied in which
arbitration was provided was an unsettled issue submitted to arbitra
tion. One company union set out to invoke its right to arbitration
but abandoned the move in the face of serious employer opposition.
SUMMARY AND CONCLUSIONS
203
Most important of all, perhaps, the company unions were hampered
by their inability to control wage conditions in more than one plant.
Although prevailing wages were specifically recognized as a deter
minant in wage negotiations in many cases, the company unions had
no machinery for affecting conditions in competing plants.
Company unions generally lacked adequate means for ascertaining
the wishes and problems of the employees. Two-thirds had no pro
vision for regular meetings of employees, and some of those which did
met only once a year. General membership meetings are vital to any
organization which seeks to keep in intimate touch with the desires
and aims of its members. Where regular and frequent employee
meetings are not held, no chance is given to employees as a body to
discuss general problems and policies which are of interest to them.
Furthermore, except in those few cases in which employee representa
tives were allowed time off to contact their constituents, employees
had no regular machinery for conveying their individual views and
interests to their representative.
The company unions studied evinced little interest in matters of
social or labor legislation and were not active in presenting the views
of employees on such matters. There was little discussion in their
meetings regarding matters of labor legislation or national policy
affecting their interests. When such matters were discussed, the
company-union spokesmen were likely to present information and
statements which had been given them by management.
During the N. R. A. period there was a tendency for trade-unions
and company unions to exist in the same establishment. In not all
cases did the two compete directly for membership. Where they did
compete, the fact that the company union charged no dues and that
it was favored by management gave it an advantage in the minds of
many of the workers. Benefit and welfare plans to which the com
pany contributed were in a number of cases administered through
the company union, giving a monetary advantage to membership.
In a few cases the company union was given credit for the establish
ment of benefit provisions, which were administered and financed
entirely by the company. In a variety of more or less tangible ways
the preference of the company was made evident.
Comparison of the structural characteristics of new and old company
unions indicates certain significant general tendencies after the enact
ment of N. I. R. A. Thus there has been a tendency in the direction
of membership company unions rather than automatic-participation
organizations, and a move to reduce service and other requirements
for participation. Management participation has been reduced or
eliminated in many respects, including a shift away from the jointcommittee towards the employee-committee form of functioning.
Dues and employee meetings have become more common. Collective
204
CHARACTERISTICS OF COMPANY UNIONS
bargaining has appeared as a definitely stated objective in some
company-union constitutions. The number of agreements signed
by both company unions and management has increased, although
such agreements are still uncommon and sometimes merely incorporate
procedural arrangements formerly included in the constitution of the
company union.
As a result of these structural changes, there has developed a new
type of company union that more or less approaches the formal char
acteristics of trade-unions. This type, represented by 10 percent of
the company unions studied, has, in general, a membership basis,
membership meetings, dues, bilateral agreements with the company,
and provisions for arbitration. A few have paid officials. To this
extent they approximate the formal characteristics which are com
monly ascribed to workers’ organizations. However, they continued
to require that all members and even all employee representatives
must be employees of the company, and they had no contacts with
workers’ organizations outside the company.
Considered from the standpoint of their functional pattern, company
unions present a varying aspect. For this reason it is impossible to
make any neat generalization which will at once describe and ap
praise all company unions. It would seem, however, that they can
be grouped into three broad classifications.
At one extreme are a large number of company unions—more than
half— which performed none of those functions which are usually
embraced under the term “ collective bargaining.” Some of these
were merely agencies for discussion. Others had become essentially
paper organizations after their primary function was performed when
a trade-union was beaten. About one-tenth of the company unions
studied,/although claiming broader functions, were in reality concerned
only with benefit and welfare matters. While their activities along
these lines may be important, it is misleading to represent them as
agencies for collective bargaining. It does not necessarily follow that
this type of organization violated the wishes of the majority of the
employees concerned; it is possible that the employees may have been
averse or at least indifferent to any other kind of organization.
Another group of company unions, about one-third, were under
taking only a few of the activities in which trade-unions normally
engage. These company unions concerned themselves with individual
grievances and some matters relating to working conditions; but broad
questions of wages and hours, if they were discussed at all, had not
been submitted to a process of negotiation and bargaining. Where
these company unions have been successful in the limited area of
grievance adjustment, a liberal, intelligent attitude on the part of
management has been an important factor. With careful coopera-
SUMMARY AND CONCLUSIONS
205
tion by management about half of the company unions in this group
had become effective avenues for the adjustment of individual
grievances.
The third group of company unions— about 15 percent of the total
studied— were seriously attempting to function in those fields com
monly ascribed to collective bargaining. They represented the inter
ests of the workers with a vigor not entirely attributable to manage
ment encouragement. However, the most vigorous and independent
of these company unions existed under conditions of isolation. As
agencies for the adjustment of individual grievances they differed
from the adjustment machinery set up under trade-union agreements
in many industries in that the employee representatives in adjusting
grievances had to face their superiors without the backing of an
organization independent of the employer. In the broader field of
wage and hour negotiations the company unions did not have access
to information or personnel from a national union headquarters.
The degree of isolation in practice was even greater than that
inherent in the structure of a union limited to the employees of a
single company. Thus, few interested themselves in any proposed
legislation or governmental action affecting workers. They did not
hire persons outside the plant to assist in negotiations with their
employers. Neither did they seek arbitration by impartial outsiders
of requests refused by the employer. So rarely was strike action
even considered that the threat of withholding their labor played
virtually no part in negotiations with their employers. Finally, the
most vigorous of these organizations had no means for marshalling
the moral and financial support of large bodies of workers to influ
ence the terms of the labor contract beyond the confines of a single
company.
A PPE N D IX E S
207
Appendix I
Company Unions and the Law of Collective Bargaining
Only since the World War have company unions emerged as a
problem for legislative and judicial consideration. A recent phe
nomenon in industrial society, they first assumed prominence in the
cases handled by the National War Labor Board. But it was not
until 1930 that important litigation directly involving the existence
and activity of company unions reached the courts. In that year, the
United States Supreme Court affirmed an order directing the Texas
and New Orleans Railroad to purge itself of contempt by disestablish
ing a company union which it had promoted in violation of its employ
ees’ statutory right to designate representatives of their own choosing.®
More recently the enactment by Congress of a series of measures
affirming the right of self-organization of employees for collective
bargaining purposes and prohibiting interference with this right has
raised immediate and insistent issues as to the legal status of company
unions.
The law in the United States recognizes the validity of labor unions
for purposes of collective bargaining concerning conditions of employ
ment. It does not interfere with an organization legitimate in its aims
and its methods. This recognition, however, does not automatically
protect employees from interference in their efforts at self-organiza
tion. The coexistence of an unqualified right in employers to hire
and fire may interfere with the collective activity of employees. To
condition employment upon a promise not to join a labor organization
curbs the growth of trade-unionism. The sponsorship of companydominated unions by employers obstructs collective bargaining by
independent labor organizations. All these forms of conduct and
others interfere with concerted action by employees. The courts
have been called upon to resolve conflicting claims and to define the
limits of allowable interference. The law of labor combinations has
then focused upon a determination of the extent to which collective
activity might be permitted and upon problems arising as the result
of conduct which interferes with self-organization of employees and
collective bargaining. The legal status of company unions is a part
of the law of labor combination which can be understood only after
some examination of that entire branch of the law.
« T exa s &
$48 (1930).
N ew
O r le a n s R a ilr o a d
C o , et a l.
y.
B ro th erh o o d , o f R a i l w a y
and
S te a m sh ip
C le r k s et a l .,
209
281 U . S.
210
CHARACTERISTICS OF COMPANY UNIONS
Collective Activity and the Law
The law of eighteenth century England looked with disfavor upon
combinations of workmen to raise their wages, and Parliament enacted
legislation prohibiting concerted activity in various occupations.
Thus, in 1720 1 an act forbade journeymen tailors from entering into
combinations to raise their wages or lessen their hours, and it con
demned offenders “ to hard labour or the common gaol without bail or
mainprize.” This combination of journeymen tailors, read the act,
“ is of evil example, and manifestly tends to the prejudice of trade,
to the encouragement of idleness, and to the great necessity of the
poor * *
Later statutes extended similar inhibitions to
weavers,2 journeymen dyers,3 and other crafts.4
Nor did the courts look with less severity upon workingmen’s
efforts to better their conditions. In 1721 the King’s Bench6 con
victed journeymen tailors for conspiring to raise their wages. In a
later prosecution for collective activity the defendants were convicted
with the statement that “ the illegal combination is the gist of the of
fense, persons in possession of any articles of trade may sell them at
such prices as they may individually please, but if they confederate
and agree not to sell them under certain prices, it is a conspiracy; so
every man may work at what price he pleases, but a combination not
to work under certain prices is an indictable offense.” 6
In denying the legality of collective action, the courts relied upon
the flexible doctrine of conspiracy which emerged to govern activities
of employee combinations in early English and American labor history.
In the first recorded American decision, the Philadelphia Cordwainers’
case,7 where striking workmen faced prosecutions for criminal con
spiracy, the court sweepingly declared that “ a combination of work
men to raise their wages may be considered in a twofold point of
view; one is to benefit themselves * * * , the other is to injure
those who do not join their society. The rule of law condemns both.”
Conviction followed this charge to the jury with its reliance upon
English judicial precedent. For many years the courts referred to
the rule of law announced in the Cordwainer’s case. The New York
court, however, in its first decision 8 noted a distinction between means
and end. The legality of group activity depended upon the lawful
ness of its purpose and upon the character of the methods adopted to
bring that purpose to successful fruition.
i 7 G eo. 1, st. 1, c. 13.
2 12 G eo. 1, c. 34.
3 22 G eo. 2, c. 27.
4 S ee for exa m p le 13 G eo. 3, c. 68 (w eav ers in silk ).
® R e x v . J o u r n e y m e n T a i l o r s o f C a m b r i d g e , 8 M o d . 10 (1721).
6 R e x v . E c c l e s , L each C . C . 274 (1783).
7 C o m m o n w e a l t h v . P u l l i s (1806), 3 C om m o n s & G ilm ore, D o c u m e n ta r y H isto r y o f A m erican In d u stria l
S o cie ty , 59, 233 (1910).
8 P e o p l e v . M e l v i n , S elect C ases 111 (N . Y . 1810), 3 C o m m o n s & G ilm ore, D o c u m e n ta r y H isto ry of A m eri
can In d u stria l S o cie ty 251 (1910).
THE LAW OF COLLECTIVE BARGAINING
211
Illumination and clarification of the existing law of conspiracy
resulted from Chief Justice Shaw's opinion in Commonwealth v. H unt .9
The indictment recited that the defendants conspired not to work for
any master who employed a workman not a member of the society;
that in fulfillment of this purpose they obtained the discharge of
Jeremiah Horne and sought to deprive him of his livelihood as a boot
maker. The convictions obtained in the lower court were reversed.
“ The manifest intent of the association is to induce all those engaged
in the same occupation to become members of it. Such a purpose is
not unlawful * * *. Nor can we perceive that the objects of the
association, whatever they may have been, were to be attained by
criminal means." The language of the decision and the resulting
acquittal mark a definite departure from the previous doctrines of the
courts. The earlier cases provided little, if any, scope for self-help
through exertion of organized pressure by workmen to better their
conditions. The courts denied labor the right to use economic com
pulsion. But Chief Justice Shaw's decision recognized an area for
economic conflict within which organized labor might strive to attain
union objectives.
When in the last quarter of the nineteenth century the courts faced
issues created by modern industrialism, the lawfulness of labor combi
nation was no longer questioned. Organization and concerted ac
tivity of workers was no longer per se illegal. The social utility of
collective bargaining premised even the more restrictive decisions.
In the words of Chief Justice Taft:
They (labor unions) have long been thus recognized by the courts. They were
organized out of the necessities of the situation. A single employee was helpless
in dealing with an employer. He was dependent ordinarily on his daily wage for
the maintenance of himself and his family. If the employer refused to pay him
the wages that he thought fair, he was nevertheless unable to leave the employ
and to resist arbitrary and unfair treatment. Union was essential to give laborers
an opportunity to deal on equality with their employer.10
The problem had shifted to an examination of the permissible scope
of union activity through the use of the strike, the boycott, and the
picket line. The law defined the permissible area within which collec
tive employee action might legally take place. The decisions and
statutes described the bounds within which combinations of workmen
might receive legal tolerance. But more than that, with this broaden
ing of the field of allowable activity by employees, there also began a
narrowing of the conduct permitted to employers in their efforts to
thwart concerted activity by workers. More and more, as the law
expressed a public policy in favor of collective bargaining, these legal
restrictions upon the conduct of employers increased.
B4 M etcalf 111 (M ass. 1842).
A m er ic a n
S te e l F o u n d r ie s
v.
T r i-C ity
C en tra l
T ra d es
C o u n c il,
257 U . S. 184, 209 (1921).
212
CHARACTERISTICS OF COMPANY UNIONS
Types of Interference With Collective Activity of Workers
The right to hire and fire .— The right to hire and fire when directed
against trade-union members is one of the most direct methods of
combating trade-unionism. Statutes were early enacted in the United
States which made it a criminal offense to dismiss employees or
discriminate against prospective employees because of their union
membership or activity. The Erdman Act of 1898 11 included such a
provision applicable to railroads and their employees. This portion of
the act was declared invalid by the Supreme Court, thus establishing
the constitutional right of employers to dismiss an employee for any
reason whatsoever, including trade-union affiliation. The Supreme
Court said, in this, the Adair case:
While * * * the rights of liberty and property guaranteed by the Con
stitution against deprivation without due process of law, is subject to such reason
able restraints as the common good or the general welfare may require, it is not
within the functions of government— at least in the absence of contract between
the parties— to compel any person in the course of his business and against his
will to accept or retain the personal services of another, or to compel any person
against his will, to perform personal services for another. The right of a person
to sell his labor upon such terms as he deems proper is, in its essence, the same as
the right of the purchaser of labor to prescribe the conditions upon which he will
accept such labor from the person offering to sell it. So the right of the employee
to quit the service of the employer, for whatever reason, is the same as the right
of the employer, for whatever reason, to dispense with the services of such
employee. It was the legal right of the defendant Adair— however unwise such
a course might have been— to discharge Coppage because of his beN
ing a member
of a labor organization. In all such particulars the employer and the employee
have equality of right, and any legislation that disturbs that equality is an
arbitrary interference with the liberty of contract which no government can
legally justify in a free land.12
The Supreme Court in this opinion also found no connection be
tween interstate commerce and the statutory prohibition, to justify
the Congressional enactment as a regulation of interstate commerce.13
This decision as to the constitutionality of statutes restricting the
right to fire employees because of union membership was followed
by the State courts which were asked to pass upon the validity of
similar statutes. In nearly every case these statutes were found to
violate the due process clause of the State constitution.
11 30 U . S. S ta t. 424.
12 A d a i r v . U n i t e d S t a t e s , 208 U . S. 161 (1908).
13 “ * * * M a n ife stly , a n y ru le p rescrib ed for th e c o n d u ct o f in ter sta te com m erce, in order to b e w ith in
th e c o m p e te n c y o f C on gress u n d er its p o w er to reg u late com m erce a m o n g th e S ta tes, m u st h a v e so m e real
or su b sta n tia l rela tio n to or co n n ectio n w ith th e com m erce regu lated . B u t w h a t p o ssib le leg a l or log ical
c o n n ectio n is th ere b e tw e e n a n e m p lo y e e ’s m em b ersh ip in a lab or organ ization a n d th e carryin g o n of in ter
sta te com m erce? S u ch rela tio n to a lab or o rg an ization ca n n o t h a v e , in itse lf an d in th e e y e o f th e la w , a n y
b earin g u p o n th e com m erce w ith w h ic h th e e m p lo y ee is c o n n ected b y h is lab or a n d services. L a b or
asso cia tio n s * * * are organized for th e gen eral p u rp ose o f im p r o v in g or b e tte rin g th e co n d itio n s an d
con serv in g th e in ter e sts o f its m em b ers as w a g e earners— an ob ject e n tir e ly le g itim a te a n d to b e co m m en d ed
rath er th a n c o n d em n ed . B u t su r e ly th o se association s as lab or organ ization s h a v e n o th in g to d o w ith
in ter sta te com m erce as su ch . * * *”
THE LAW OF COLLECTIVE BARGAINING
213
The effect of the Adair case was limited by the more recent Rail
way Clerks’ case, supra, arising under the Railway Labor Act of
1926.14 This act provided, among other things, that employers and
employees for purposes of collective bargaining were to select repre
sentatives “ without interference, influence, or coercion exercised by
either party over the self-organization or designation of representatives
by the other” .16 The lowest court found that the fostering of a
company union by intimidation of employees and the discharge of
trade-union officials constituted interference with the right of self
organization as contemplated by the statute. An injunction was
granted to prevent further interference. A contempt order based
upon violation of the in junction was affirmed by the Supreme Court.
The order, among other things, required the reinstatement of the
discharged trade-union officials. The court declared that the
principle enunciated in Adair v. United States was inapplicable:
The Railway Labor Act of 1926 does not interfere with the normal right of the
carrier to select its employees or to discharge them. The statute is not aimed at
the right of the employers but at the interference with the right of the employees to
name representatives of their own choosing. As the carriers subject to the act have
no constitutional right to interfere with the freedom of the employees in making
their selections, they cannot complain of the statute on constitutional grounds.16
No further judicial clarification of the legal status of the employer’s
right to hire and fire was made until the N. I. R. A. and the cases
that arose under it.17
Antiunion contracts.— Outstanding as a device to prevent unionism
and obstruct collective bargaining has been the “ yellow dog” con
tract. Although varied in form, such a contract in substance
obligates the employee not to join a trade-union or engage in strikes
or other trade-union activities. In turn the employer gives the
worker employment either for a definite period of time or at will.
The employment is conditional upon the fulfillment of the obligation.
Antiunion contracts early received legislative attention. Several
States and the Federal Government placed statutes on their books
making it a criminal offense to require antiunion promises. Almost
uniformly they were held unconstitutional. In 1915 the question
reached the Supreme Court, which held a State statute unconstitu
tional largely on the authority of the Adair case. In both cases the
statutory restraints upon the employer were held to impair rights
guaranteed by the due process clause of the fourteenth amendment.18
14 44 S ta t., 577 (1926).
18 Id e m sec. 2 (T h ir d ).
is T e x a s & N e w O r l e a n s R a i l r o a d C o . e t a l . v . B r o t h e r h o o d o f R a i l w a y a n d S t e a m s h i p C l e r k s e t a l . , 281 U . S.
548 (1930).
n See p . 229 ff.
18C o p p a g e v . K a n s a s , 236 U . S. 1 (1915): “ U n d er co n stitu tio n a l freedom o f con tract, w h a te v e r eith er
p a r ty h a s th e righ t to treat as su fficien t ground for term in a tin g th e e m p lo y m en t, w h ere th ere is n o stip u la tio n
o n th e su b ject, h e h a s th e rig h t to p ro v id e a g ain st b y in sistin g th a t a stip u la tio n resp ectin g it sh a ll b e th e
sin e q u a n o n o f th e in c e p tio n o f th e em p lo y m en t, or of its co n tin u a n ce if it b e term in a b le at w ill. I t follow s
th a t th is case ca n n o t b e d istin g u ish ed from A d a i r v . U n i t e d S l a t e s .”
214
CHARACTERISTICS OF COMPANY UNIONS
In practice, the “ yellow dog” contract operates most effectively
as a bar to unionization when the injunction is utilized to protect it
from threatened breach. The use of the injunction to protect the
“ yellow dog” contract was brought to the attention of the Supreme
Court when the United Mine Workers of America attempted to
unionize the nonunion coal-mining area in the West Virginia Pan
handle where employees had signed such contracts. United Mine
Workers’ organizers attempted to induce them to agree to join the
union, and the evidence indicated deception and abuse in the methods
used. In this case, Hitchman Coal & Coke Company v. Mitchell™
the Supreme Court enjoined the organizers from soliciting membership.
The injunction was based upon the well-established doctrine that
action will lie against the person who persuades either party to a
contract to breach it. The Hitchman case was the first important
application of this doctrine to the antiunion contract.
The Supreme Court subsequently suggested a limitation upon the
decision, and other jurisdictions did not entirely accept its authority.
In American Steel Foundries v. Tri-City Central Trades Council, the
Hitchman injunction was rested upon the deception employed and
not the fact of solicitation for union membership. “ The unlawful
and deceitful means used were quite enough to sustain the decision of
the court without more.” 20
Legislative attempts were again made to modify the existing law.
In 1929 Wisconsin passed a statute which makes “ yellow dog” con
tracts void and unenforceable on the ground that they are against
public policy.21 The Wisconsin statute does not make criminal
the exaction of antiunion promises, but it prevents the courts from
granting relief at law or equity to enforce them. The Norris-La
Guardia Act,22 passed in 1932, contains a provision which similarly
makes antiunion promises unenforceable. Section 3 declares antiunion
promises “ to be contrary to the public policy of the United States.”
Such undertakings “ shall not be enforceable in any court of the
United States and shall not afford any basis for the granting of legal
or equitable relief by any such court * * *.” 23
The constitutional validity of this legislation was strengthened by
the Supreme Court’s decision in the Railway Clerks’ case in 1930.24
While the issues of this case did not center directly upon an antiunion
contract, in limiting the effects of the Adair case, which held that
10 245
20 257
U . S. 229 (1917).
U . S. 184 (1921), p . 211. See E x c h a n g e B a k e r y & R e s t a u r a n t C o m p a n y v . R i f k i n , 245 N . Y . 260,157
N . E . 130 (1927), w h ere th e N e w Y o rk cou rt h e ld th a t a n a n tiu n io n c o m m itm en t w a s n o t a con tract sin ce
th e p rom ise w a s m a d e after th e em p lo y m en t b ega n an d therefore d id n o t serve as con sid eration . A lso see
I n t e r b o r o u g h R a p i d T r a n s i t C o . v . L a v i n , 247 N . Y . 65, 159 N . E . 863 (1928).
21 W isco n sin S ta t., 1929 (103.46).
22 U . S. C . (1934) T itle 29, sec. 101 e t seq .; 47 U . S. S ta t. 70, c. 90.
23 See p . 225, fo o tn o te 58, for d iscu ssio n o f oth er sectio n s o f th is act.
a* S ee p p . 213, 221, 222.
THE LAW OF COLLECTIVE BARGAINING
215
employers had the right to fire at will for any reason, it also narrowed
the principle of Coppage v. Kansas.25
Some recent statutes have prohibited the “ yellow dog” contract
altogether. The Federal Bankruptcy Act of 1933 forbade carriers
in bankruptcy from making them and provided that employees must
be notified that such contracts already in existence were no longer
binding.26 The same provision was embodied in the Emergency
Railroad Transportation Act of 1933, applicable to all carriers whether
or not in bankruptcy.27 In 1934 Congress continued this prohibition
in the amendments to the Railway Labor Act of 1926 28 and a similar
provision was made applicable to all corporate reorganizations by the
Bankruptcy Act of 1934.29 Section 7 (a) of the N. I. R. A. provided
that “ no employee and no one seeking employment shall be required
as a condition of employment to join any company union or to refrain
from joining, organizing, or assisting a labor organization of his own
choosing” 30—language sufficiently inclusive to apply to “ yellow dog”
contracts. The National Labor Relations Act (1935) makes it an
unfair labor practice by “ any term or condition of employment to
encourage or discourage membership in any labor organization.” 31
Otherform s of interference.— Closely related to discrimination and the
employer’s right to discharge is the blacklist. To procure the dis
charge of an employee by false representation is actionable at common
law, and even where the statements are true a person who procures
another’s discharge is subject to liability if malice can be shown.
Thus, although an employee has no action against an employer who
discharges him, he may have redress against the third party who
reported his trade-union activity to the employer, thereby inducing
his discharge. Moreover most States have statutes which make
criminal the establishment of a blacklist.32
Legislatures have attempted to regulate and control other forms of
interference with trade-union activity, such as the use of force through
company guards and the employment of detectives and strikebreakers
28 In th e C op p a ge case th e C ou rt said : “ In A d a i r v . U n i t e d S t a t e s (20 U . S. 161), th is C ou rt h a d to deal
w ith a q u estio n n o t d istin g u ish a b le in p rin cip le from th e on e n o w p resen ted .”
28 U . S. C ., T itle 11, sec. 205 (q ).
27 U . S. C ., T itle 49, sec. 257 (e).
28 U . S . C ., T itle 45, sec. 152 (fifth ).
22 U . S . C ., T itle 11; sec. 207 (m .).
20 U . S . C ., T itle 15, sec. 707 (a) (2).
21 U . S . C ., S u p p . I I (1936), T itle 29, sec. 158 (3).
32
S o m e o f th ese sta tu te s are v e r y general, m e re ly p ro h ib itin g b la ck listin g w ith o u t co n ta in in g a n y d efin i
tio n o f th e term . See U ta h C o m p iled L a w s, 1917, sec. 3680. O th ers d escrib e th e co n d u ct a g ain st w h ic h th ey
are a im ed in m ore d eta il. S ee W is. S ta ts. 1923, sec. 4466b, w h ic h p ro v id es th a t em p loy ers w h o co m b in e
“ for th e p u rp ose of p rev en tin g a n y person seek in g e m p lo y m en t from o b ta in in g th e sa m e, or for th e pu rp ose of
procuring or cau sin g th e d isch arge o f a n y e m p lo y ee b y th rea ts, p rom ises, circu la tin g b la ck lists, or ca u sin g
th e sa m e to b e circu la ted , or w h o sh a ll, after h a v in g d isch arged a n y em p lo y ee, p rev en t or a tte m p t to p r e v e n t
su c h e m p lo y ee from o b ta in in g e m p lo y m e n t w ith a n y oth er p erson , p artn ersh ip , c o m p a n y , or corp oration
b y th e m ea n s aforesaid , or sh a ll a u th o rize, p erm it, or allo w a n y o f h is or th eir ag en ts to b la ck list a n y d is
charged e m p lo y ee or a n y em p lo y ee w h o h a s v o lu n ta r ily left th e service o f h is e m p lo y er, or circu la te a b la ck
list o f su c h em p lo y ee to p rev en t h is ob ta in in g e m p lo y m en t u n d er a n y oth er em p lo y er * * *” sh a ll b e
su b ject to p u n ish m en t b y fine.
216
CHARACTERISTICS OF COMPANY UNIONS
by employers. In this connection, the Seventy-fourth Congress in
1936 passed an act prohibiting the interstate transportation of persons
with the intent to employ such persons “ to obstruct or interfere * * *
with the right of peaceful picketing during any labor controversy
affecting wages, hours, or conditions of labor, or the right of organiza
tion for the purpose of collective bargaining * * * .” 33
Legal Status of Company Unions Before N. I. R. A.
The National W ar Labor Board .— The first governmental agency
which faced the problem of company unions was the National War
Labor Board, appointed on April 8, 1918, for the duration of the
World War, in accordance with the recommendations of the War
Labor Conference Board. This Board was given jurisdiction to act
with respect to all controversies “ in the field of production necessary
for the effective conduct of the war.” 34 It was established as an
agency of conciliation and arbitration. In cases where submission
was made by both parties the Board acted as arbitrator. Where,
however, the submission was made by only one party, it merely made
recommendations. Although the Board had no powers of enforce
ment, its rulings and activities with respect to company unions and
shop committees had a definite influence upon their development.
The awards were respected and the recommendations followed
because public opinion recognized the importance of preventing any
stoppage of production during the World War and because other
government departments dealing with industry supported the Board.
The principles under which the Board was to operate did not men
tion company unions. The War Labor Conference Board, which
recommended its creation, had formulated the basic rule upon which
the Board’s awards were to be premised,35 namely, that workers had
the right to organize in trade-unions and to bargain collectively, and
to protect this right, discrimination against trade-union members and
interference with trade-union activity were forbidden.36
In several cases, intracompany associations dominated by employers
were challenged on the ground that such organizations interfered with
the employees’ basic right to organize and bargain collectively. In all
these cases the War Labor Board ruled that an organization imposed
by the employer was not an adequate substitute for such organization
as a majority of employees might choose for purposes of collective
bargaining. The choice was for the employees to make.
Thus, in the case of the New York Consolidated Railroad 37 the
employer contended that an intracompany association sufficed as an
U . S. C . S u p p . I I (1936), T itle 18, sec. 407a.
34 See P ro cla m a tio n o f th e P resid en t C rea tin g th e N a tio n a l W ar L ab or B o ard , A p ril 8, 1918.
3®F or th e te x t o f th ese p rin cip les, see ch. I , p . 11 f.
38 See B u rea u o f L ab or S ta tistic s B u ll. N o . 287 (p p . 32-33), “ P rin cip les an d p o licies to go vern rela tio n s
b e tw e e n w ork ers an d em p lo y ers in w ar in d u stries for th e d u ra tio n of th e w a r .”
37 See B u rea u of L ab or S ta tistic s B u ll. N o . 287 (p p . 263-264), case 283, O ct. 24,1918.
33
T H E L A W O F C O L L E C T IV E B A R G A IN IN G
217
agency for collective bargaining. The employees denied its ade
quacy on the ground that “ the association is within the direct environ
ment, if not actually under the control, of the company itself.” The
Board mentioned a few characteristics of the company plan:
*
*
*
B u t one feature which has persisted is th a t th e president of the com pany
has appointed the president of th e association and the president of the association
has either him self conducted elections or appointed persons to do so.
The Board’s award stated:
I t m u st be ruled th a t th e em ployees of the com pany w ho desire to becom e
m em bers o f th e Brotherhood o f L ocom otive Engineers, or a ny other legitim ate
labor organization, shall be perm itted to do so w ithout denial, abridgem ent, or
interference upon the part of th e com pany.
Again, in another case, the Board declared:38
*
*
*
N o r do th e division m eetings held b y the m en, which were advocated
b y th e com p an y as an adequate plan of collective bargaining, constitute an ideal
or even a proper m eans of free and unham pered discussion b y the m en o f their
grievances and presentation of sam e to the com p any for adju stm en t.
W e recom
m end th at th e com p an y carry out the principle of this Board which gives to the
em ployees the right to m eet and treat through their own com m ittees w ith the
officials of th e com p an y in regard to wages, working conditions, and other m atters
affecting th e interest of th e workers.
In another case39 the Board again found—
T h a t the com p an y's plan o f collective bargaining through a com m ittee prim arily
constituted and appointed b y th e com pany for the purpose of holding and dis
bursing a fund for payin g claim s against the com p any occasioned b y accident,
does n ot m eet the requirements of this Board with regard to collective bargaining
and does n ot constitute such a plan of collective bargaining as the m en are
entitled to.
Here the Board recommended that the company meet with com
mittees elected by the employees—
regardless of the fa ct th a t th ey are elected at a m eeting of workers who are m em
bers of th e union.
T h is does n ot require the com pany, however, to deal with
unions as such, or to recognize th e unions.
In these cases the National War Labor Board went no further than
to declare that the workers were to have freedom of choice in self
organization, and that the device of imposing an intracompany asso
ciation would not be permitted to interfere with the freedom of choice.
By inference employees might organize into an intracompany associa
tion for purposes of collective bargaining. But they could not be
compelled to do so.
Of far greater importance in an appraisal of the Government’s in
fluence upon the development of company unions was the establish
ment of shop committees by the Board. The creation of shop com38 Id e m , P a cific E lectric R a ilw a y C o., case 214, A p r. 10,1919, p p . 239-241.
39 Id e m , S an D ie g o E lectric R a ilw a y C o., case 452, A p r. 10,1919, p p . 301-302.
mm°—3$----- 10
218
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
mittees resulted from two principles which the Board followed: First,
it recognized the worker's right to have a voice in the determination
of his working conditions through collective bargaining. Second, it
did not require the employer to contract with a trade-union or to deal
with one not his employee as representative of his employees unless
the employer had done so prior to the submission of the controversy
to the Board. Employers who had recognized trade-unions were to
continue to do so to the same extent as they had previously done.
But the Board would not compel an extension of such recognition to
plants where it did not already exist. As a device to reconcile the
application of these two principles of the maintenance of the status
quo as to union recognition and of collective bargaining, shop com
mittees were established.40
The War Labor Conference Board in its report summarizing the
principles to be pursued by the National War Labor Board in main
taining industrial peace did not expressly impose upon employers any
duty to bargain collectively. Workers had the right to bargain
collectively but no correlative duty for employers was set forth in the
report. In its awards, however, the National War Labor Board de
termined to make effective the right to bargain collectively. It had
no intention of setting up shop committees in futile obeisance to the
principle of collective bargaining. The shop committees were insti
tuted for use as tools of collective bargaining. Uniformly in the
awards it was ruled that employers had a duty to bargain collectively.
While the Board never defined this obligation of collective bargaining
with any precision, at a minimum it involved the recognition of com
mittees and required dealing with them after constituted. Thus the
Board ruled that—
T h e com p an y shall continue to deal with those unions w ith w hom th ey have pre
viously h ad trade-union agreem ents, and in all other cases shall deal w ith com
m ittees of their em ployees after th ey h ave been constituted .41
Again in another case the employers were directed to—
M e e t w ith com m ittees o f their own em ployees for the purpose of adjusting
a n y grievances which m a y arise.42
The National War Labor Board thus affirmed the right of employees
to organize and in so doing to be free from any interference by the
employer, and it asserted the duty of the employer to bargain collec
tively. At the same time, by organizing shop councils, it stimulated
the development of organizations the membership of which was con
fined to employees of the particular plant.
« E x a m p le s are th e sh o p c o m m itte e s esta b lish ed in B rid gep o rt, C o n n ., w h ere th e B o ard n o t o n ly set u p
a b oard o f m e d ia tio n a n d con cilia tio n over so m e 60 e sta b lish m en ts; b u t, in p la n ts w h ere n o tra d e-u n io n s
ex isted , th e B o ard A d m in istra to r sp e n t m o n th s in se ttin g u p sh o p c o m m itte e s for p u rp oses of c o llectiv e
b a rg ain in g a n d th e se ttle m e n t o f grieva n ces. See ch . I, p . 12 ff., for a d escrip tio n of th e sh o p co m m itte e s
esta b lish ed b y th e B oard .
« B u rea u o f L ab or S ta tistic s, B u ll. N o . 287, C orn P ro d u cts R efin in g C o., case 130, N o v . 21, 1918, p p .
189-198.
*2 Id e m , A . H , P eterso n M a n u fa ctu rin g C o., case 320, M a r. 14,1919, p . 269,
T H E L A W O P C O L L E C T IV E B A R G A IN IN G
219
The railroads.— With the end of the World War, and the subsequent
disbandment of the National War Labor Board on August 12, 1919,
sustained governmental interest in industrial relations subsided. The
attitude of the courts toward labor disputes remained much the same
as it had been prior to our entry into the European conflict. The
restraining influence of the various agencies set up during the war to
maintain harmonious industrial relations was lifted. The principles
of Adair v. United States and Coppage v. Kansas ruled again. The law
manifested no concern in shop committees or in the problems of com
pany unions as against trade-unions. The era of judicial laissez
faire with respect to the rights of employees to organize for their
benefit returned. The work of the war labor agencies resulted in no
permanent redefinition of the permissible bounds of economic conflict
between employer and employee.
Governmental concern for labor organization and industrial peace
with reference to railroad employees provided the one significant
exception. The peculiar economic characteristics of railroads, their
importance in modern industrial society, the necessity of maintaining
service, had at an early date emphasized the need of some form of
governmental regulation of relations between carriers and their em
ployees. Beginning in 1888, a series of Congressional acts attempted
to create a machinery which would aid in maintaining smooth relation
ships. This development was interrupted by the World War. During
the emergency, the need for centralized control resulted in Federal
administration.
The United States Railroad Administration asserted that employees
had the right to organize and be free from antiunion discrimination.
But in 1920 the railroads were returned to private ownership, and the
entire machinery set up during the World War to handle railroad
labor disputes was cast aside. As a substitute, the Transportation
Act of 1920 43 created a Railroad Labor Board to which was entrusted
the function of deciding disputes involving grievances, rules, or work
ing conditions. The Board was composed of three representatives
each of carriers, unions, and the public. Its awards were to be enforced
by publication of its findings and its decisions. It was hoped that the
force of public opinion would induce obedience to the Board’s awards.
No legal sanctions were granted, however, to compel enforcement.
The act itself did not set forth specific principles concerning the
employee’s right to organization. But the Board promulgated rules
which declared the workers’ right to organize, their right to be free from
interference in exercising this right, and to decide by majority vote
what organization should represent them.44 But in the case of some
crafts on many railroads the application of these rules caused a sub« 41 U . S. S ta t. 456.
W olf, H . D .: T h e R ailroad L abor B o ard . U n iv e r sity of C h icago P ress, 1927, p p . 184-186.
220
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
stitution of company unions for the trade-unions which had existed on
the railroads. When the shopmen went on strike in 1922, the Board
declared that strikers were no longer employees and that those at
work should “ form some sort of association or organization to func
tion in the representation of said employees before the Railroad Labor
Board in order that the effectiveness of the Transportation Act may
be maintained” .46 Since few of those remaining at work and those
hired to take the strikers’ places were trade-union members, this
ruling of the Board resulted in the formation of company unions.46
The fact that the orders of the Board were unenforceable gave
further impetus to the formation of company unions. The Pennsyl
vania Railroad refused to obey an order that an election be held to
determine whether its workers were to be represented by a tradeunion affiliated with the American Federation of Labor or by a
company union, the membership of which was confined to employees
on the Pennsylvania Railroad. The carrier sought an injunction to
restrain the Board from making a public statement that the carrier
had refused to obey the Board’s order. The Supreme Court denied
the injunction47 upon the ground, among others, that inasmuch as
the act imposed no constraint upon the carrier to obey the Board’s
orders, except the constraint of publication, the order did not infringe
upon any constitutional right of the carrier.
In a subsequent case 48 in which the trade-union sought an injunc
tion to compel obedience to the act and the Board’s orders, the Court
denied relief upon the authority of the earlier case. The Court held
that the Transportation Act did not contemplate any sanction except
that provided by publication. Thus there existed no legal prohibition
to restrain a carrier from imposing a company union upon its employees
against their wish and in violation of an order of the Board requiring
an election to determine representation for the purposes of collective
bargaining.
These cases left the way open for either kind of representation—
trade-unions or employee-representation plans. As a result, however,
of the Board’s lack of power to enforce its decisions, the company
unions established by the railroads were the only representatives of
the workers in these crafts whom the carrier acknowledged and recog
nized for purposes of negotiation.
A more precise legislative statement of the principles to govern
employee representation was introduced in the Railroad Labor Act of
1926. To fulfill the obligation imposed by the act, that is, “ to exert
every reasonable effort to make and maintain agreements” , Congress
« W olf, H . D .: T h e R ailroad L ab or B oard . U n iv e r sity of C h icago P ress, 1927, p p . 239-240.
« See ch. II, p . 20.
47
48
P e n n s y lv a n ia R a ilr o a d
C om p a n y
P e n n s y lv a n ia R a ilr o a d S y s te m
et a l .,
267 U . S. 203 (1925).
v.
U n ite d
S ta te s R a ilr o a d L a b o r B o a r d et a l .,
a n d A l l i e d L i n e s F e d e r a tio n N o . 9 0 et a l.
v.
261 U . S. 72 (1922).
P e n n s y lv a n ia R a ilr o a d
C om p a n y
221
T H E L A W O F C O L L E C T IV E B A R G A IN IN G
created legal rights enforceable in the courts to protect the self
organization of employees for the purpose of collective bargaining.
The statute forbade “ interference, influence, or coercion exercised by
either employers or employees over the self-organization or designa
tion of representatives by the other.” 49 And it was under this section
of the law that the first important judicial decision as to the legal
status of company unions arose.60
A wage dispute arose on the Texas & New Orleans Railroad.
During the wage dispute, the Brotherhood of Railway Clerks claimed
that the company interfered with the self-organization of its clerks by
creating a company union and by compelling its employees through
intimidation to join the organization, and it obtained an injunction
restraining this conduct. Subsequently the company recognized the
company union as representative of the employees. The district
court found that the officers of the company in so doing were guilty
of contempt and directed that, in order to purge themselves, the com
pany and its officers should “ disestablish the Association of Clerical
Employees” as the recognized representative of its clerks and in its
place recognize the Brotherhood of Railway Clerks as representatives
pending an election by secret ballot, conducted under the supervision
of the court.61
The case reached the Supreme Court, which, in ruling upon the
carrier’s appeal, declared:
Freedom of choice in the selection of representatives on each side of the dispute
is th e essential foundation of the statu tory schem e.
A ll the proceedings looking
to am icable adju stm en ts an d to agreem ent for arbitration of disputes, th e entire
policy o f th e a ct, m u st depend for its success on the uncoerced action o f each
pa rty , through its own representatives, to the end th a t agreem ents satisfactory to
b o th m a y be reached an d th e peace essential to th e uninterrupted service of the
instrum entalities of interstate com m erce m a y be m aintained.
There is no im pair
m en t of the volu n tary character o f arrangem ent for the ad ju stm en t o f disputes
in th e im position o f a legal obligation n ot to interfere w ith th e free choice of those
who are to m ake such ad ju stm en t.
On the contrary, it is of the essence of a
volu n tary schem e, if it is to accom plish its purpose, th at this liberty shall be
safeguarded.
The court found interference with that freedom of choice in—
T h e circumstances of the soliciting of authorizations and m em berships on
behalf o f the association, th e fa c t th a t em ployees of the railroad com p any who
were active in prom oting th e developm ent of the association were perm itted to
d evo te their tim e to th a t enterprise w ithout deductions from their p a y , the charge
to th e railroad com p an y o f expenses incurred in recruiting m em bers of th e associa
tion, th e reports m ad e to th e railroad com pany o f the progress o f these efforts,
and th e discharge from the service o f th e railroad com pany of leading representa
tives of the brotherhood, and the cancelation of their passes
*
*
*.
« 44 U . S . S ta t. 577 (1926) sec. 2 (T h ir d ).
See p . 209.
11 T h e cases in v o lv in g th is litig a tio n m a y b e fou n d in th e la w rep orts as follow s: 24 F . (2d) 426; 25 F . (2d)
873, 876; 33 F . (2d) 13; 280 U . S. 550.
222
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
All of these factors—
gave support
*
*
* to the conclusion of the courts below th at the railroad
com p an y and its officers were a ctu ally engaged in prom oting the organization
of th e association in th e interest o f th e com p an y a nd in opposition to th e brother
h ood , an d th a t these activities con stitu ted an a ctu al interference w ith the liberty
of th e clerical em ployees in th e selection o f their representatives.
Chief Justice Hughes then spoke of the constitutional authority of
Congress to enact the law.
Exercising this auth ority (the power to regulate interstate com m erce) Congress
m a y facilitate th e am icable settlem en t o f disputes which threaten the service of
th e necessary agencies o f interstate transportation.
In shaping its legislation
to th is end, Congress was en titled to tak e cognizance o f actual conditions a n d to
address itself to practicable m easures.
T h e legality o f collective action on the
part o f em ployees in order to safeguard their proper interests, is n ot to be disputed.
I t has lon g been recognized th a t em ployees are entitled to organize for th e purpose
of securing th e redress of grievances and to prom ote agreem ents w ith em ployers
relating to rates o f p a y and conditions o f work.
T r i - C i t y C e n tr a l T r a d e s C o u n c i l , 2 5 7 U . S. 184, 20 9.
A m e r ic a n S tee l F o u n d r ie s v .
Congress was n ot required
to ignore th e right o f em ployees b u t could safeguard it and seek to m ak e their
appropriate collective action an instrum ent of peace rather than of strife.
Such
collective action w ould be a m ockery if representation were m ade futile b y inter
ferences of choice.
T h u s the prohibition b y Congress of interference w ith th e
selection of representatives for th e purpose o f negotiation and conference between
em ployers and em ployees, instead o f being an invasion of the constitutional right
of either, was based on the recognition of the rights of both.
Thus the Adair and Coppage cases were distinguished, as was pre
viously mentioned, on the ground that the act in question did not
interfere with the carrier’s right to discharge or select its employees
but merely protected employees from interference with their right to
designate representatives of their own choosing.
This case affirmed the constitutional validity of congressional action
granting workers the right to be free from interference in organizing
and in designating representatives for collective bargaining. It up
held the constitutionality of a statute establishing collective bargain
ing as the favored method for determining conditions of employment
for railroad employees. It permitted these employees to enforce
their statutory rights through court proceedings. An injunction
might be granted to restrain a carrier from interfering with the self
organization of its employees and to prevent “ the abuse of relation
or opportunity so as to corrupt or override the will” of those in its
employ. The Supreme Court went further. It upheld the contempt
order, directing the company to purge itself by disestablishing the
company union.
Prohibitions against interference by employers with the employees’
right of self-organization and the maintenance of company unions
appeared in one statute dealing with interstate carriers. Amendments
in 1938 to the Bankruptcy A c t 52 specifically forbade carriers “ whether
62 U . S. C ., T itle 11, sec. 205 (P ).
T H E L A W O F C O L L E C T IV E B A R G A IN IN G
223
under the control of a judge, trustee, receiver, or private manage
ment^ to maintain company unions by the expenditure of company
funds, or to influence or coerce employees to join or remain members
of such associations, or to in any other way deny the right of employees
“ to join the labor organization of their choice.” 53 The Emergency
Transportation Act of 1933 54 extended these provisions to include all
carriers whether or not in bankruptcy, and also extended to carriers in
bankruptcy the provisions of the 1926 Railway Labor Act.55
Under that part of the Emergency Transportation Act of 1933 which
required the Federal Coordinator to confer with labor organizations
which had been designated as representatives of employees in accord
ance with the requirements of the Railway Labor Act, the Coordinator
sought to determine what labor organizations were entitled to partici
pate in the conferences. It was found that many carriers had inter
fered in the selection of employee representatives, and that in many
cases the carriers had contributed to the financial support of company
unions and in other ways had encouraged and aided in their establish
ment and functioning. In such situations the Coordinator held
elections through secret ballot to determine whether the employees
wished the company union or trade-union to represent them.
In 1934 Congress amended the Railway Labor A c t 56 to strengthen
its provisions with respect to the settlement of disputes and par
ticularly to define duties and rights as to collective bargaining. The
new law, like the 1926 law, obligated the carriers and employees to
negotiate and maintain collective agreements. The right to free
choice of representatives was announced.
T hird.
R epresentatives, for the purposes of this a ct, shall be designated by
the respective parties w ithout interference, influence, or coercion b y either pa rty
over th e designation o f representatives b y th e oth er; and neither p a rty shall in
a n y w ay interfere w ith, influence, or coerce the other in its choice o f representa
tives.
R epresentatives o f em ployees for th e purposes o f this a ct need n o t be
persons in the em p loy o f the carrier, and no carrier shall, b y interference, in
fluence, or coercion seek in a n y m anner to prevent th e designation b y its em
ployees as their representatives of those who or which are not em ployees of the
carrier.
The representatives are designated by majority rule. If a dispute
arises as to what organization or individual the majority of workers
w W h en , in A u g u st 1935, th e R a ilw a y B a n k r u p tc y A ct of 1933 w a s a m en d ed th e p ro v isio n s regarding col
le c tiv e b argain in g w ere o m itte d . B u t b y th a t tim e req u irem en ts sim ila r in effect h a d b een ad d ed b y th e
1934 a m e n d m e n ts to th e R a ilw a y L ab or A c t o f 1926.
s< U . S . C ., T itle 49, sec. 257 (e). T h e la w p rov id ed th a t it w o u ld “ cease to h a v e effect a t th e en d of one
yea r after J u n e 16, 1933, u n less ex ten d ed b y th e p roclam a tio n o f th e P resid en t for 1 yea r or a n y p a rt thereof
* * * .” B y P ro cla m ation N o . 2082, p rom u lg ated M a y 2, 1934, th e a ct w a s e x ten d ed for an oth er yea r
after J u n e 16, 1934. S in ce th e 74th C ongress d id n o t ex ten d th e a ct, it expired J u n e 16, 1935.
55 C ongress u tiliz in g its b a n k ru p tc y ju risd ictio n ap p lied sim ila r p ro v isio n s to corporate reorgan ization s
o f oth er th a n railroad corporations. (B a n k r u p tc y A c t o f 1934 (U . S. C .. T itle , 11 sec, 207 (1 )).)
« U . S . C ., T itle 45, secs. 151 to 164; 48 S ta t. 1185.
224
C H A R A C T E R IS T IC S O F C O M P A N Y U N IO N S
desire as representatives, the Mediation Board, upon request, is
empowered to investigate the dispute—
and to certify to both parties
*
*
*
the nam e or nam es o f the individuals
or organizations th a t h ave been designated and authorized to represent the em
ployees in volved in the dispute
*
*
This is an important departure from the 1926 statute which did not
establish any procedure for settling disputes relating to representation.
This law specifically prohibits certain types of conduct which might
“ interfere with, influence, or coerce” a party in the choice of its
representatives. The “ yellow dog” contract is barred and carriers
are forbidden—
to use th e funds of the carrier in m aintaining or assisting or contributing to a ny
labor organization, labor representative, or other agency of collective bargaining.
Company unions are not named in the act. But its provisions are
aimed at practices which through the creation and maintenance of
company-dominated unions interfere with collective bargaining. Em
ployees may, if they so choose, designate ana ssociation the membership
of which is confined to employees of a single carrier or system. But it
must be a free choice. Management influence or interference with elec
tions is prohibited and management may not try to control the policies
and actions of employee organizations. Company unions are, how
ever, debarred from participating in the making of decisions respect
ing the interpretation and application of collective agreements. The
act specifically says that employee membership on the Adjustment
Board, which settles disputes arising from the interpretation and
application of agreements, shall be designated by “ national labor
organizations.” And national labor organizations are defined as
“ such labor organizations of the employees, national in scope, as have
been or may be organized” without interference by the employer, and
in accordance with the relevant requirements contained in the act.67
The 1934 amendments to the Railway Labor Act were the result
of 50 years’ legislative and judicial experience in trying to maintain
industrial peace on the railroads. Government control during the
World War, the inadequacies of the Transportation Act of 1920
under which company unions had multiplied, and the administration
of the act of 1926 all indicated the desirability of collective bargaining
and collective agreements. This experience indicated that collective
bargaining was possible only where workers could make a free and
unhampered choice of representatives. Hence those practices which
interfered with the free choice of representatives and therefore with
collective bargaining were legally barred.
48 S ta t. 1185, sec. 3 (b ), (c).
T H E L A W O F C O L L E C T IV E B A R G A IN IN G
225
Industry as a whole did not have the development of legislative
regulation which characterized the railroads.58 During the World
War the need for immediate and consistently expanding production
forced the creation of agencies to establish and maintain peaceful
relations between capital and labor. Upon the expiration of the war,
there was a reversion to the pre-war situation in which courts and
the law acknowledged the social utility of labor unions but did not
extend their aid to protect employees from discrimination for their
union affiliations and denied that the Government had any legal
interest in restraining interference with union organization and in
preventing antiunion discrimination.
The National Industrial Recovery Act
The depression beginning in 1929, with its resultant lowering
of wages and living standards, compelled a departure from the tra
ditional attitude. On June 16,1933, the National Industrial Recovery
Act was enacted as part of a legislative program to meet the economic
crisis.59 Among its stated objects was included the maintenance of
“ united action of labor and management under adequate govern
mental sanctions and supervision.”
Section 7 (a) contained the labor provisions pertinent to this study
and provided that—
E v ery code of fair com petition, agreem ent and license approved, prescribed
or issued under this title, shall contain th e follow ing conditions:
(1) T h a t em ployees shall h ave th e right to organize and bargain collectively
through representatives of their own choosing, and shall be free from th e inter
ference, restraint or coercion of em p loyers of labor, or their agents, in th e desig
nation o f such representatives either in self-organization or in other concerted
activities for the purpose of collective bargaining or other m u tu al aid or pro
tection.
(2) T h a t no em ployee and no one seeking em p loym ent shall be required, as
a condition of em p loym en t, to join any com p an y union or to refrain from joining,
organizing, or assisting a labor organization o f his own choosing;
*
*
*.
The protection of this section extended only to industries covered
by codes established pursuant to section 3 of the statute and to
i8 O ne im p o rta n t le g isla tiv e effort rela tin g to c o llectiv e b argain in g w a s p la ced on th e sta tu te b ook s. In
th e v e r y d e p th s of th e d ep ression in 1932, C ongress p a ssed th e N orris-L aG u ard ia A c t (U . S. C ., T itle 29,
secs. 101 to 115). I t p ro v id ed th a t u n d er certain sta ted circu m stan ces e q u ity ju risd ictio n b e w ith d ra w n
from th e F ed eral cou rts in cases in v o lv in g lab or d isp u tes. T h e declared p u rp ose an d p u b lic p o lic y o f th e
act is to in su re th e w ork er “ fu ll freed om o f association , self-organization, an d d esig n a tio n o f rep resen ta tiv es
o f h is o w n ch oosin g, to n eg o tia te th e ter m s a n d co n d itio n s o f h is e m p lo y m e n t.” F u rth er, th e a c t declared
th a t h e sh o u ld b e “ free from th e in terferen ce, restrain t, or coercion o f em p lo y ers o f lab or, or th eir ag en ts,
in th e d esign ation o f su c h rep resen ta tiv es or in self-organ ization or in oth er con certed a c tiv ities for th e
p u rp ose of co llectiv e b argain in g or oth er m u tu a l aid or p ro tectio n .” A lso see p . 214, infra, for d iscu ssio n
o f th e p ro v isio n of th is act d ealin g w ith th e “ y e llo w d o g” con tract.
«• U . S. C ., T itle 15, secs. 701-712.
226
C H A R A C T E R IS T IC S OP C O M P A N Y U N IO N S
employers who signed the President’s Reemployment Agreement.60
Employers not covered by a code or agreement remained unaffected
by the mandates of section 7(a). Unrestrained by statutory pro
hibition, they might compel their employees to abstain from union
activity.
In the next few years several labor boards succeeded each other
for the purpose of administering section 7(a).61 There were also
created labor boards which handled cases arising in particular indus
tries under section 7(a).62 These boards through their decisions
defined the rights and duties created by the statute. Through
application of the provisions of section 7(a) to particular cases,
they developed a law of collective bargaining.
M ajority rule.— The prime requisite for any technique of collective
bargaining is the selection of representatives, and the selection must
be free from interference. In Matter of Houde Engineering Corpora
tion 63 the National Labor Relations Board formulated the “ majority
rule” which was to govern the determination of who would be the
representatives of a given unit. In this case, an election had been
held under the auspices of the Board, in which the union had been
chosen by a majority of the employees eligible to vote. The company
contended that it was under a duty to deal with the association (an
intracompany association) chosen by the minority as well as with the
union designated by a majority. This the Board denied. It stated
that the basic aim .of section 7 (a) was to encourage collective bargain
ing as a means of making and maintaining collective agreements and
thus “ to stabilize, for a certain period, the terms of employment, for
the protection alike of employer and employee” (p. 35). The Board
stated that an interpretation of section 7 (a) permitting any practice
which “ would hamper self-organization and the making of collective
agreements cannot be sound” (p. 37).
60 T h is w a s an ag reem en t b e tw e e n th e P resid en t an d th e in d iv id u a l em p lo y er w h e re b y th e e m p lo y er
p rom ised to esta b lish m in im u m w ork in g co n d itio n s in c lu d in g an ob serv an ce o f th e p rin cip les o f sectio n
7 (a). I t w a s d e v ise d to serv e as a b la n k et cod e coverin g in d u str y u n til in d iv id u a l codes h a d b een form u
la te d in p u rsu a n ce of th e sta tu te .
61 T h e N a tio n a l L a b or B o ard , esta b lish ed b y th e P resid en t on A u gu st 5, 1933, w a s a b ip a rtisa n board of
w h ic h S en ator W agn er, an im p a rtia l m em b er, w a s ch airm an . T h e first N a tio n a l L abor R e la tio n s B oard
w a s crea ted o n Ju n e 29, 1934, in co m p lia n ce w ith a con gression al resolu tion (P u b lic R es. 44, 73d C o n g .).
T h is board w a s em p ow ered to in v e stig a te con troversies, h o ld electio n s a n d h earin gs, an d m a k e fin d in g s o f
fact regarding v io la tio n s of sectio n 7 (a) of th e N . I. R . A . U n less o th erw ise sp ecified , th e term “ B o ard "
w h e n u sed in th is sectio n on th e N a tio n a l In d u stria l R e co v ery A c t refers to th e first N a tio n a l L abor R ela
tion s B oard.
62 C h ief a m o n g th e sp ecial boards w ere th e P etro leu m L abor P o lic y B oard , th e A u to m o b ile L a b or B oard ,
an d th e T e x tile an d S teel L abor B o ard s. T h e fin d in gs of th ese boards w ere tu rn ed over to th e C om p lia n ce
D iv isio n of th e N . R . A . for en forcem en t.
63 1 N . L . R . B . (1) 35. D e cisio n s of th e N a tio n a l L abor B o ard an d of th e N a tio n a l L a b or R e la tio n s
B o a rd s are c ite d b y th e ab b rev ia tio n s N . L . B . an d N . L . R . B ., r esp e ctiv e ly , w ith th e v o lu m e a n d th e
p age n u m b er o f th e p a m p h let series p rin ted b y th e G o v ern m en t P rin tin g O ffice in w h ic h th e case m a y b e
fo u n d . T o d istin g u ish th e c ita tio n s of th e first N a tio n a l L abor R ela tio n s B o ard from th e c ita tio n s o f cases
d ecid ed b y its su ccessor e sta b lish ed p u rsu a n t to th e a ct o f J u ly 5, 1935 (49 S ta t. 449), th e d esig n a tio n (1)
w ill follow th e ab b rev ia tio n N . L . R . B . in th e cita tio n s of th e first B o a r d ’s cases.
THE LAW OF COLLECTIVE BARGAINING
227
The Board further stated that the policy of dealing first with one
and then with the other organization destroyed the effectiveness of
collective bargaining. This policy enabled the company to favor one
group to the detriment of the other. It prevented the formation of
agreements— the aim of collective bargaining. Nor did the Board
agree that a composite committee including representatives of both
the majority and the minority sufficed.64
But whether or not the w ork ed representation by a composite committee
would weaken their voice and confuse their counsels in negotiating with the
employer, in the end whatever collective agreement might be reached would have
to be satisfactory to the majority within the committee. Hence the majority
representatives would still control, and the only difference between this and the
traditional method of bargaining with the majority alone would be that the sug
gestions of the minority would be advanced in the presence of the majority. The
employer would ordinarily gain nothing from this arrangement if the two groups
were united, and if they were not united he would gain only what he has no right
to ask for, namely, dissension and rivalry within the ranks of the collective-bar
gaining agency (p. 40).
The Board held that the purpose of section 7 (a) favoring collective
bargaining compelled an interpretation of that section embodying the
majority rule as a necessary device in the selection of representatives.
Thus:
When a person, committee or organization has been designated by the majority
of employees in a plant or other appropriate unit for collective bargaining, it is
the right of the representative so designated to be treated by the employer as
the exclusive collective bargaining agency for all employees in the unit, and the
employer’s duty to make every reasonable effort, when requested, to arrive with
this representative at a collective agreement covering terms of employment of
all such employees (p. 44).
The order required the company to recognize the union as the
exclusive bargaining agency of its employees and to enter into nego
tiations with the union in an effort to arrive at a collective agreement
covering conditions of employment. However, it did not require
the minority to join the organization which represented the majority.
The Board utilized the technique of election by secret ballot in
order to designate representatives for a given unit.65 Although its
predecessor, the National Labor Board, very early began to hold
elections, no express legislative authority for this existed until the
passage of Public Resolution No. 44, which set up the Board.66 Any
board established by the President pursuant to the resolution had
MA lso see M a tter of th e D e n v e r T r a m w a y C orporation, 1 N . L . B . 64, M ar. 1, 1934, w h ere th e W agn er
B o ard an n o u n ced th e m ajo rity rule.
66 T h e B o ard d id n o t d ecid e in a n y of its cases w h a t c o n stitu te s a m ajo rity w h o se rep resen tatives are
e n title d to sp ea k for th e en tire group in m atters of collectiv e b argain in g. See p . 249 for su b seq u en t clarifi
ca tio n o f th is p rob lem in a d ecisio n o f th e secon d N a tio n a l L abor R ela tio n s B oard, an d p. 252 for court
d ecision s arisin g u n d er th e 1934 a m en d m en ts of th e R a ilw a y L ab or A ct.
S p ace d o es n o t p erm it a su m m a ry o f th e cases d ealin g w ith th e q u estio n as to w h a t co n stitu te s an ap
prop riate collectiv e-b arg ain in g u n it.
e® 43 S tat. 1183. P u b lic R es. 44, 73d C ong.
228
CHARACTERISTICS OF COMPANY UNIONS
the power to hold elections, when it appeared “ in the public interest.” 67
The Petroleum Board ruled that any appropriate method of ascer
taining the representatives of the employees was permissible and that
the method of formal election was not indispensable.68
Collective bargaining.— The N. I. R. A. did not define the rights
and obligations concerning collective barganing which were established
by section 7 (a). That section merely stated “ that employees shall
have the right * * * to bargain collectively * *
The
decisions of the different boards interpreted this to mean that there
existed a correlative duty for employers to bargain collectively.
The subjects of collective bargaining were to be wages, hours, and
working conditions.69
Toilet facilities, safety measures, lighting and ventilation, coat racks, slippery
stairs, and so on * * * in no sense constitute the recognized subjects of
collective bargaining, namely, wages, hours and basic working conditions.70
The duty to bargain collectively involves more than merely meeting
with representatives of the workers. The employer must “ negotiate
actively in good faith to reach an agreement.” 71 He must “ discuss
differences with the representatives of the employees and * * *
exert every reasonable effort to reach an agreement on all matters in
dispute.” 72 There is no duty to make any particular agreement, but
where a proposal is not satisfactory it should be met by counterpro
posals rather than a flat refusal to continue further negotiation. The
law contemplates—
that both parties will approach the negotiations with an open mind and will
make a reasonable effort to reach a common ground of agreement. The definite
announcement of the company that it will not make an oral or written agreement
deprives collective bargaining of any content or objective.73
The Board stated that agreements usually should be in writing,
although circumstances of a particular case might create an exception.
An agreement—
unless reduced to writing, will be so impractical of enforcement and so fruitful of
disputes concerning terms, that an insistence by an employer that he will go no
67 E le c tio n s h a v e lo n g b een u se d b y d ifferen t agen cies of th e G o v ern m en t to d eterm in e q u estio n s o f
rep resen tation . T h e N a tio n a l W ar L ab or B o ard an d th e va riou s railroad boards fou n d it n ecessa ry to
h o ld electio n s. T h e order u p h e ld b y th e S u p rem e C ou rt in th e R a ilw a y C lerk s’ case (see p . 221) req u ired
th e c o m p a n y to rein sta te th e b roth erh ood as rep resen tative “ u n til su ch tim e as th ese e m p lo y ee s, b y a
secret b a llo t ta k e n in accordance w ith th e fu rth er d irection of th e C ourt * * ♦ sh o u ld ch oose oth er
rep resen ta tiv es.”
69
T h u s o n an ap p eal in th e case o f M a g n o lia C o. (case no. 2, d ecision , F eb . 6, 1934; d ecision o n ap p eal,
F e b . 28, 1934), certification w a s m a d e u p o n th e b a sis o f an election p e titio n sig n ed b y a m a jo rity o f th e
e m p lo y ees in th e collectiv e-b arg ain in g u n it. T h e co m p a n y h a d agreed to recognize th e p erson or a g en cy
d esign ated in th e p e titio n b y th e m a jority as rep resen tative for th e u n it.
69 Matter of Art Metal Construction Co., 1 N. L. B. 24, Nov. 1, 1933; Matter of Houde Engineering Cor
poration, supra.
70 M a tte r o f H o u d e E n g in eerin g C orporation, su p ra, a t 38.
71 M a tte r o f E a g le R u b b er C o., 2 N . L . B . 31, 33, M a y 16, 1934.
72 Matter of National Lock Co., 1 N. L. B. 16,19, Feb. 21, 1934.
72 Matter of Connecticut Coke Co., 2 N. L. B. 88, 89, June 30,1934,
THE LAW OF COLLECTIVE BARGAINING
229
further than to enter into an oral agreement may be evidence, in the light of
other circumstances in the case, of a denial of the right of collective bargaining.7*
Collective bargaining is the means to an end.
The end is an agreement. And, customarily, such an agreement will have to do
with wages, hours, and basic working conditions, and will have a fixed duration.
The purpose of every such agreement has been to stabilize, for a certain period,
the terms of employment, for the protection alike of employer and employee.
By contrast, where all that transpires is a demand by employees for better terms
and an assent by the employer, but without any understanding as to duration,
there has been no collective agreement, because neither side has been bound to
anything.75
Interference through various form s of discrimination.— Section 7 (a)
specifically forbade interference with self-organization of workers. In
so doing it limited the employer’s right to discharge employees; it pro
hibited antiunion discrimination in all its various forms. The
National Labor Board recognized that—
There obviously is no more effective way of interfering with the self-organiza
tion of employees than to discharge those who are active in the union of their own
choosing. The statutory requirement (which forbids dismissal for union activity)
may not be evaded by the ready reliance on other grounds for discharge. The
employer, in dismissing an employee, must not be actuated in any degree what
soever by the latter’s union affiliation or activities. The statute does not impair
the freedom of employers of labor to discharge their employees for infractions of
company rules or for other proper and adequate business reasons. T o safieguard
the privileges conferred by the statute, however, it is imperative that the circum
stances of the discharge be carefully scrutinized and that its validity be deter
mined by the appropriate agencies of the Government entrusted with the adminis
tration and enforcement of the law.76
The Board never clearly defined the extent to which the employee
might be required to sustain the burden of proving antiunion dis
crimination. The remedy for unlawful discharge was reinstatement
with back pay.
Other forms of interference also received the attention of the Board.
Among these were the bribery of union officials which the Board
described as—
A flagrant interference by [the employer] with the right of his employees to strike
and to agitate by other lawful means in advancing their legitimate self-interest.77
Another form of interference was employer negotiation with em
ployees for individual contracts requiring them not to strike.
The strike is, of course, the most effective weapon in the arsenal of an aggressive
labor organization, and by the same token the most effective manner in which an
employer can interfere with the self-organization of his employees and can prevent
them from assisting labor organizations is to require them to agree not to strike.78
7* M a tter o f A n ilen e & C h em ica l C o., 1 N . L . E . B . (1) 114,116, O ct. 3,1934.
75 M a tte r o f H o u d e E n g in eerin g C orp oration , su p ra, p p . 35-36.
76 M a tte r o f G eneral C igar C o ., 1 N . L . B . 71, F eb . 6,1 934 . A large p rop o rtion o f th e cases arisin g u n d er
se c tio n 7 (a) d e a lt w ith d isch arge for u n io n a c tiv ity .
77 M a tte r o f N o r th C arolin a G ra n ite C orporation, 1 N . L . R . B . (1) 89, 92.
78 M a tter o f Jo h n E . L u e e y S h oe C o., 2 N . L . R . B . (1) 251,254, e t seq ., w h ere th e B o ard found, su c h con
tra cts to h e in v io la tio n o f b o th su b sec tio n s (1) a n d (2) of sectio n 7 (a ).
230
CHARACTERISTICS OF COMPANY UNIONS
Company unions .— In addition to discharge for union activity, the
most important and prevalent form of interference is employer par
ticipation in and sponsorship of company unions. Section 7 (a) did
not ban company unions. The only direct mention of such associa
tions occurred in subdivision (2) and provided “ that no employee
and no one seeking employment shall be required as a condition of
employment, to join any company union * * * .”
In Matter of Tamaqua Underwear Company,79 a closed-shop agree
ment between the company and the company union was held invalid.
The company had sponsored the formation of Tamaqua Employees’
Union. A poll was taken during working hours on the initiative of the
management. Secret ballot was not used at this election. Those who
did not vote to join the employees’ union were locked out, but following
the intervention of the Board, they were permitted to resume work.
Subsequently an election was held under the supervision of the Board
at which the employees’ union was selected by a majority of the em
ployees to represent them. With respect to the characteristics of this
organization, the Board stated:
The hands which guided its organization were those of employees who were in an
executive or supervisory position; * * * . If he (the general manager) did
not initiate the union, he has at least fostered its growth with considerable enthusi
asm by advising his employees to affiliate therewith and by permitting it to use
the plant for meetings and his office equipment for certain typing (p. 11).
The association’s president and the general manager signed a closedshop agreement which merely read:
It is hereby agreed that the Tamaqua Underwear Company agrees to recognize
the demand of the Tamaqua Employees’ Union for a closed shop, beginning
June 22, 1934 (p. 10).
Subsequently, 61 employees who refused to join the organization
were dismissed in conformity with the agreement. The Board, con
sidering the company’s efforts to foster the union, found it to be a
company union within the meaning of section 7 (a), subdivision (2).
It therefore held that the closed-shop agreement violated section 7 (a)
in that it required employees as a condition of employment to join a
company union and accordingly ordered the company to reinstate the
61 men who had been dismissed.
The company-union cases before the Board have presented a series
of acts which in the aggregate have been held to constitute inter
ference in violation of the statute. No single factor such as financial
domination by the employer or the drafting of the constitution by
management has been singled out as the sole cause of a decision.
The decisions of the Board have considered and prescribed conduct
which leads to employer domination of employee organizations.
Such conduct includes the suggestion of the form of organization by
n in,U
P, P. (1) 10,
THE LAW OF COLLECTIVE BARGAINING
231
the employer, the drafting of its constitution by lawyers or officers
of the company, lack of opportunity to accept or reject the plan,
absence of secret ballot in a vote adopting the plan or electing repre
sentatives to serve under it, payment of additional salaries to repre
sentatives for the performance of their duties in that capacity, the
supplying of clerical and stenographic services for the conduct of the
association’s business, provisions in the constitution giving the
employer the power to make final decisions or to veto decisions of the
employee representatives, giving the company union credit for wage
increases, or making benefits arising from pension plans dependent
upon membership in the association favored by the employer.
Some cases have disclosed conduct by employees amounting to
coercion. Interference has taken the form of discrimination in favor
of a company union through the discharge or threat of discharge of
nonmembers. In one case, the evidence showed the exertion of pres
sure to have employees join a company union by threatening discharge
for refusal to join.80 Another employer, prior to an election conducted
by a regional board, entrenched “ in the minds of his employees the fear
* * * that they would lose their employment if they voted, and
that, for that reason, a large majority refrained from voting.” 81
The issue of interference arose in cases where a petition for an
election was presented to the Board and also where, unaccompanied
by any such petition, there was a request to stop the conduct which
interfered with the self-organization of the employees. The cases
summarized in the following pages will give additional details as to
the conduct considered by the Board in determining the legal status
of company unions.
The problem of whether organizations which are the fruit of em
ployer interference may qualify as collective-bargaining agencies has
arisen in cases involving petitions for an election. In Matter of The
Kohler Company82the union alleged interference and petitioned for an
election and that the Kohler Workers’ Association be dissolved. After
the formation of a trade-union, three employees, including the chief
chemist and a working foreman, asked the permission of the president
of the company to form an inside union. An assistant to the president
aided them in drafting a constitution. The following day organiza
tion meetings were held, at which the president of the company alone
spoke. He stated that the company would pay the expenses of the
Kohler Workers’ Association and that meetings would be held on
company time. Application cards for membership, requiring the
signature of the employees, were distributed. They stated that the
80 M a tter of L . G rief & B ro., In c ., 2 N . L . R . B . (1) 353. A n d see M a tter of T a m a q n a U n d erw ear C om
p a n y , supra.
81 See M a tter of D a n b u r y & B e th el F u r C o., 1 N . L . R . B . (1) 195, 198.
82 1 N . L . R . B . (1) 72.
232
CHARACTERISTICS OF COMPANY UNIONS
“ failure to join the organization would not militate against a n y
worker.” But the Board noted that it was—
impossible for any worker secretly to register his approval or disapproval of the
proposed association, faced as they were by the evident desire of the president
that they support the new organization. Seeing all preparations at hand for their
joining and realizing that unless they signed it would be easy to ascertain that
fact and perhaps, despite the printed assurance, to exert more direct pressure, it
is but reasonable to expect that the workers would sign regardless of what their
real desires were. No opportunity was given to indicate whether they wished
to be represented in bargaining by any organization other than the Kohler
Workers’ Association (pp. 74, 75).
Subsequently the organizing committee was allowed to canvass the
plant during working hours, a privilege denied to the union.
Thus it is clear that the company participated in forming and engaged actively
in promoting the new organization, that the workers had no opportunity of
expressing an unfettered choice as to whether or not they wished to belong to it,
and that the company not only indicated its favorable attitude toward the
organization but stood ready to finance its existence. Under the circumstances,
the organization could not have that independence which is essential to a true
collective-bargaining agency, and the sudden and extensive promotion of the
plan at a time when the outside union was just being formed can only be considered
as a deliberate design to influence the allegiance of the employees and to interfere
with their free and unhampered self-organization which section 7 (a) guarantees
(p. 75).
The petition for an election was granted. Although the Board
found that the association resulted from unlawful interference, the
petition for dissolution was denied and the Kohler Workers’ Associa
tion was allowed a place on the ballot.83 “ The wrong done by the
company can * * * be remedied by an election” (p. 75).
In Matter of Firestone Tire & Rubber Co.,84 a recently organized
federal labor union petitioned the Board to order an election and to
declare the employees’ conference plan illegal because of interference
by the company in the organization of the plan. The evidence
showed that the management conducted an election to select repre
sentatives of the employees to draft a plan. The elected representa
tives, with the aid of management representatives, prepared a con
stitution which was put into operation without the general body of
83 See M a tte r of C u d a h y B roth ers, 2 N . L . E . B . (1) 479. “ In su ch an electio n (an elec tio n h eld p u rsu a n t
to P u b lic R es. 44, 73d C o n g .), th e E m p lo y e e s’ W ork C o u n cil is e n title d to a p la ce o n th e b a llo t.” In th is
case th ere w a s n o p e titio n for d isso lu tio n of th e c o m p a n y u n io n . A lso , see M a tter of H o osier M a n u fa c
tu rin g C o., 2 N . L . R . B . (1) 458 a n d M a tter o f T h e K a y n e e C o., 2 N . L . R . B . (1) 33, for cases w h ere a co m
p a n y u n io n w a s p la ced on th e b a llo t. See release of th e N a tio n a l L ab or R e la tio n s B o a rd , d a te d D e c . 26,
1934, in th e M a tter of K n o x v ille G ra y E a g le M a rb le C o., case n o . 146, for a case w h ere a c o m p a n y u n io n
w o n th e electio n , a n d th e B o ard certified it “ as th e sole rep resen ta tiv e of th e e m p lo y ee s * * * for th e
purpose of co lle c tiv e b a rgain in g, w ith all th e righ ts a n d p rivileges v o u ch safed b y la w to su c h ch oice an d
certifica tio n .”
84 1 N . L . R . B . (1) 173.
THE LAW OF COLLECTIVE BARGAINING
employees having the opportunity to reject or accept it.
an employees’ committee was established—
233
Under it
to present and discuss such matters as wages, working conditions, working hours,
seniority rules, safety, and any such other similar matters as may pertain to the
general welfare of the employees (p. 174).
Although the plan did not provide for financial support by the
company, other than paying employee representatives their ordinary
pay for time spent in committee activity, the company did, in addition,
pay the current operating expenses of the plan. All amendments
required the consent of management.
The Board pointed out that, although three-quarters of the em
ployees may have voted to select representatives under the plan,
this “ affords no sufficient basis for inferring that they liked the plan
or would choose it against other alternatives ” (p. 175).
The employees would, naturally, want to participate in the selection of repre
sentatives chosen under the plan because it is in fact a collective-bargaining
agency now recognized by the company * * * . Further, even though
no overt threats had been made by responsible officials, employees would quite
understandably be reluctant to render themselves conspicuous by refusing to
participate in the election in view of the fact that the company is known to be
strongly supporting the plan (p. 175).
The Board interpreted the motion made at the hearing that the
plan be declared illegal as a request that it be excluded from a place
on the ballot. This the Board refused to do.
Since the election is to determine a choice of representatives for collective
bargaining, we may, in extreme cases, be justified in refusing a place on the ballot
to an organization or plan of representation which by its very terms is incapable
of serving as a collective-bargaining agency. This, however, we should rarely
have occasion to do, since ordinarily the choice, good or bad, is for the employees
to make. The plan, as we read it, is better adapted to the handling of individual
grievances than it is for collective bargaining on matters of wages, hours, and
basic working conditions affecting the plant as a whole. Significant in this
connection is the fact that the plan does not provide for general meetings of
employees, as in a union local, nor even for regular meetings of the whole body
of representatives, which factors if included in the plan would obviously afford
a ready means for the formulation of the collective wishes of employees which
are an essential preliminary to the process of collective bargaining. Nevertheless,
collective bargaining is not impossible under the plan and hence * * * there
is no sufficient reason for excluding the plan from a place on the ballot (pp. 175,
176).
The fact that the company paid its operating expenses was held not
to vitiate the plan as a collective-bargaining agency, since the consti
tution itself did not provide for such financial support.
If after the election the company maintains its practice of contributing to the
financial support of the plan, whether or not the plan represents the suffrage of the
majority, such action might be held to constitute a continuing interference
(p. 176).
1 54 8 7 5°— 38-------16
234
CHARACTERISTICS OF COMPANY UNIONS
But the case did not rest here. The company and employees’ con
ference plan both filed petitions to review and to set aside the election
order. The federal labor union subsequently brought complaint,
charging the company with improper interference. The petitions
for review were still pending when the Board made its decision in the
second case with respect to the alleged interference.85 The testimony
showed that bulletins signed by the president of the company, which
indicated that the company intended to support the plan against the
competing union, were posted in the plant. The announcement was
held to constitute interference.
Whether or not under ordinary circumstances the expression by an employer of
a preference for a particular type of organization would be considered an inter
ference with the employees7 right of self-organization depends upon the facts of
each case. The company’s statements in this case, however, go beyond the ex
pression of a mere preference and indicate clearly that the company would throw
its effective weight into the struggle between competing groups for the sympathy
of the employees. The employer’s position should be one of neutrality; and the
announcement of an intention to support one competing organization against
another is interference (p. 292).
The evidence indicated that the company actively desired the plan
and was instrumental in its development. A superintendent was
largely responsible for its form. He presided at the meetings of the
drafting committee and presented it with a constitution to serve as
a model for the plan. The Board declared that an organization which
is the fruit of improper interference by the employer and does not
express the free and untrammeled choice of the employees is “ an im
proper agency for collective bargaining” (p. 292); the wrong may be
remedied by an election held under the auspices of the Board; but
where, as here, substantial delay was involved because of a petition
for judicial review of the Board’s election order, the company was not
entitled to “ bargain through the machinery of the plan which it has
illegally fostered” (p. 293). The Kohler case, where the Board
did not order the company to cease bargaining with the company
union pending the election, differed in that no substantial delay of the
election was involved. Hence, because of the delay, the Firestone
Tire & Rubber Co. was ordered to cease—
to recognize the employees’ conference plan as an agency for collective bargaining,
until, at a Government-supervised election, a majority of the employees shall
choose the plan as their agency for collective bargaining (p. 293).
An enforcement clause was also directed against the financial sup
port given the plan:
The testimony produced at the hearing shows that the company has continued
to give financial support to the employees’ conference plan; that the plan provides
for the payment of the employee representatives’ base rate plus 10 percent, but in
no case to exceed $1 per hour for all time spent in committee meetings; and that
85 2 N . L . R . B . (1) 291.
THE LAW OF COLLECTIVE BARGAINING
235
an additional 10 percent would, on an average, bring the payments up to the
amount earned on piece work. The plan further provides for the payment of
15 minutes’ time per day for time spent in discussing questions with fellow em
ployees; an amount which we consider not unreasonable. While these payments
might not necessarily be improper if the plan were approved by a majority of the
employees, we believe that coupled with the other payments referred to in the
last paragraph they constitute an improper interference with self-organization.
On a different footing altogether are those payments made directly to the plan
for the purpose of defraying its expenses, such as transportation costs for plan
witnesses at hearings, for legal and stenographic services, and for defraying the
expenses of elections. The company might with propriety suggest that no em
ployee shall be penalized because of his membership in his organization; but the
necessary result of a financial control over the affairs of the bargaining unit itself
is a substantial degree of domination in its operation. We therefore decide that
the company should forthwith cease to contribute any sums or services to the
employees’ conference plan (p. 293).
In Matter of B. F. Goodrich Company,86 a petition for election was
also presented. The plan, among other things, provided that the 150
employee representatives, in addition to their regular wages, should
receive $15 a month as well as 75 cents an hour for time spent in regu
lar committee meetings necessitating absence from their work. The
president received $30 a month and the chairmen of the welfare and
wage committees received $25 per month. The company also paid
the operating expenses, although the plan did not provide for this.
The Board again permitted the plan to appear on the ballot.
As collective bargaining can, although not without difficulty, take place within
the plan’s framework, we conclude that there is no sufficient reason for excluding
the plan from a ballot which offers the employees their free choice as to how they
wish to be represented for collective bargaining (p. 184).
The fact that the plan itself provided for the payment of 150 rep
resentatives “ which involves, in substance, the subsidizing of an
active group of propagandists among the employees for the type of
employee representation the company would prefer to deal with” did
not disqualify the plan as an agency for collective bargaining.
Since the petitioners had not requested the Board to require an amend
ment to the plan as a condition to its being placed upon the ballot,
and since no argument on this subject was presented at the hearing,
the Board permitted the plan to be placed on the ballot without any
change.
The Board refused to render any decision as to the legality of finan
cial support of the plan by the company, since there was no complaint
charging interference in violation of section 7 (a) to warrant any de
cision on this phase of the case.
The Board issued far more stringent orders in cases where a com
plaint, unaccompanied by a petition for election, charged interference
with self-organization. In Matter of the North Carolina Granite
861 N . L . R . B . (1) 1$1,
236
CHARACTERISTICS OF COMPANY UNIONS
Corporation,87 the company refused to recognize the Granite Cutters’
International Association as the representative of its employees.
Later, a few employees formed a committee with the purpose of
organizing an inside union. Before this company union was in fact
organized, the committee negotiated an agreement relating to wages.
At a meeting of some 25 workers, the agreement was accepted and the
company union organized. Other employees signed up at various
times until a majority had enrolled as members and affixed their
signatures to the agreement. Most of these, however, still were mem
bers of the trade-union. The facts were further complicated by a
series of discriminatory discharges. Employment was made depend
ent upon the signing of the agreement.
The facts showed that a majority of the employees belonged to both
organizations—
but since only a free membership was entitled to a consideration, the M. A. G. W.
A. (the company union) is disqualified to serve as an agency for collective bar
gaining. The company should recognize the G. C. I. A. (the trade-union), to
which the great majority of the employees belonged prior to the company’s un
lawful tactics, as the representative of the employees for purposes of collective
bargaining, until such time as the employees, without the interference, restraint,
or coercion of the company or its agents, choose some other representative (p. 92).
The Board cited the Railway Clerks’ case, supra, in support of its
order.
In Matter of Universal Folding Box Company,88 the Board did not
order the recognition of a union which had a majority prior to the occur
rence of the unlawful acts of the company. A strike called to enforce
a closed shop and obtain a wage increase ended with an agreement
which provided that the company would, within 30 days, enter ne
gotiations concerning wage scales and shop conditions. Shortly
thereafter the company aided in the formation of an employees’
benevolent association which “ never purported to be a collective
bargaining agency” (p. 284). The evidence showed that a 5-percent
wage increase attracted employees into the ranks of the company
union. All the employees resigned from the union and joined the
association. At the hearing every employee who testified declared
that he voluntarily withdrew from the union. The Board stated
that—
at present we cannot assume that the union represents any employees of the com
pany, and the restitution formulated in Matter of North Carolina Granite Cor
poration (1 N. L. R. B. 89) is not applicable (p. 285).
Although the Board found that the company had interfered with the
self-organization of its employees, it did not then compel recognition
of the union which had had a majority prior to the illegal conduct.
871 N . L . R . B . (1) 89.
w 2 N, L . R . B . ( 1 ) 284.
THE LAW OF COLLECTIVE BARGAINING
237
It ordered the company to refrain from requiring or urging member
ship in the association and interfering, directly or indirectly, with the
self-organization of its employees. Further, the company was pro
hibited from recognizing the association as a conective-bargaining
agency for employees and it was ordered to inform its employees of
this. In addition, the employees were to be informed that they had
the freedom to choose any organization they desired to act as their
collective-bargaining agency.
In Matter of Davidson Storage & Transfer Company,89 the evidence
disclosed certain conduct which interfered with the self-organization of
the employees and which was aimed to build up a company union.
But the legitimate union at no time represented a majority of the
employees. This was true even prior to the unlawful interference.
The Board, therefore, stated that the Davidson Employees’ Associa
tion was not an appropriate agency for collective bargaining. It
imposed no affirmative obligation upon the company to deal with
the union, which at no time represented a clear majority of the
employees eligible to membership.
In one case90 before the Petroleum Labor Policy Board, involving
complaints of intimidation and interference, the company tried to
establish a company union after a majority of the employees at a
Government-conducted election had chosen a trade-union to represent
them. Testimony indicated that foremen had instructed the
employees to select representatives under the employee-representation
plan, and that they had threatened employees with loss of their jobs
if they did not participate, and—
that certain employees believed they would be subject to disciplinary action if
they refrained from voting, and that they voted for that reason; and that a
representative of the management visited the polls during the election to deter
mine how many men had been in to vote.
The Petroleum Board stated:
The issue in this case is clear and simple: Has the Texas Company the right to
impose upon its employees, after they have freely expressed by secret ballot their
choice as to representation for collective bargaining, an organization of the com
pany’s choosing? The law’s answer is equally clear: The company has no such
right.
The Petroleum Board as a remedy for the illegal interference ordered
the disestablishment of the plan.
The Board frequently gave more detailed orders directed at specific
forms of interference. In one case 91 where the company exercised
unlawful tactics to build up membership in a company union, the
Board ordered the company to refrain from urging membership in
« 1 N . L . R . B . (1) 55.
80 M a tte r o f th e T ex a s C o m p a n y , case no. 21, d ecision , D e c. 11, 1934, D e cisio n s of th e P etro leu m L ab or
P o lic y B o ard , p . 29.
w M a tte r o f D a n b u r y & B e th el F u r C o., 1 N . L . R . B . (1) 195.
238
CHARACTERISTICS OF COMPANY UNIONS
the shop union or assisting it in any way, “ including permitting its
meetings to be held during working hours” (pp. 199, 200).92 It also
directed the company to recognize and to deal with the union for the
purpose of collective bargaining and to refrain from recognizing and
dealing with the shop union. In still another case,93 the enforcement
clause ordered the company to withdraw all financial support from
the company union. The enforcement order prohibited the company
from soliciting membership in the company union or even suggesting
to employees that they should join the company union. The company
was required to “ instruct all supervisors and foremen to cease from
such solicitations or suggestions” (p. 98). Notices on bulletin boards
were to inform employees that the company recognized the trade-union
as representative of the majority, that it had withdrawn all recog
nition from the company union, and that no employee who resigned
from the inside organization would be discriminated against.94 An
other case,95 to similar prohibitions, added that the company—
should use its best efforts, through instruction to foremen or otherwise, to prevent
solicitation of memberships in any organization of employees during working
hours (p. 110).
Thus in cases where the complaint charged interference but was
unaccompanied by a petition for election the Board ordered the recog
nition of a union which a majority of the employees of the company
had chosen as their representative prior to the acts of interference
which formed the basis of the complaint. And it also compelled
the withdrawal of recognition from the company union which resulted
from such interference. Where, however, the trade-union never had
a majority or no employees belonged to the trade-union at the time
the case was before the Board, the Board ordered the withdrawal of
recognition from the company union. But in such cases it did not
order the recognition of or collective bargaining with the trade-union.
These basic enforcement orders were frequently supplemented by
such detailed instructions as to financial support by the company
and specific acts of interference as have already been summarized or
quoted.
The Schechter decision 96 destroyed the basis upon which section
7 (a) and the interpretations of the National Labor Relations Board
and other Boards were premised. The Court held that section 3 of the
82 A lso see M a tter of S tah l-U rb a n C o., 2 N . L . R . B . (1) 149, w h ere th e B oard in its en fo rcem en t order re
q u ired th e c o m p a n y to “ w ith d ra w all su p p o rt a n d aid , d irect or in d irect, from th e ‘group lea d er’ p la n , in
c lu d in g , w ith o u t lim ita tio n , th e co n d u ct of its m eetin g s or th e tra n sa ctio n of its affairs on c o m p a n y tim e ”
(p. 153).
83 M a tter of E ly & W alk er D r y G ood s C o., 1 N . L . R . B . (1) 94.
84 A lso see M a tter of S ta h l-U rb a n C o., su p ra , p . 153, par. 4 of th e en fo rcem en t order.
85 M a tte r o f J o h n so n B ron ze C o., 1 N . L . R . B . (1) 105.
83 S c h e c h t e r v . U n i t e d S t a t e s , 295 U . S. 495 (1935). T h e d efen d a n ts, slau gh terers of p o u ltr y , w ere charged
w ith v io la tio n s o f th e w ag e, hour, an d certain trade-practice p rov ision s em b o d ied in th e L iv e P o u ltr y C od e
to w h ic h th e y w ere su b ject. T h e y b o u g h t m o st of th eir ch ick en s in N e w Y ork an d so ld n early all o f th e m
in th e m ark ets of th e sa m e S tate.
THE LAW OF COLLECTIVE BARGAINING
239
National Industrial Recovery Act, pursuant to which all codes were
established, was unconstitutional as an invalid delegation of congres
sional power and that the code in its application exceeded the per
missible exercise of Federal power under the commerce clause of the
Constitution. It declared that the wages and hours in the defendants'
business affected interstate commerce only remotely and did not
have a direct and substantial effect sufficient to support the ques
tioned exercise of power. The decision did not pass upon section
7 (a) as such, but it invalidated the codes which by statutory man
date embodied section 7 (a) and which, thereby, subjected employers
to prohibitions preventing the continuance of certain practices which
interfered with and hampered the self-organization of their employees.
The National Labor Relations A c t 97
Less than 6 weeks after the Schechter decision, the National Labor
Relations Act was enacted.98 The act declares it to be “ the policy of
the United States to eliminate the causes of certain substantial ob
structions to the free flow of commerce and to mitigate and eliminate
these obstructions when they have occurred by encouraging the
practice and procedure of collective bargaining and by protecting the
exercise by workers of full freedom of association, self-organization,
and designation of representatives of their own choosing, for the pur
pose of negotiating the terms and conditions of their employment or
other mutual aid or protection."
Section 7 of the act expands and clarifies the rights of workers
previously enunciated under section 7(a) of the National Industrial
Recovery Act, and section 8 implements these rights by enumerating
and prohibiting certain unfair labor practices 99 by employers. The
enumerated unfair labor practices may be summarized as follows:
1. T o interfere with, restrain, or coerce employees in the exercise of the rights
guaranteed in section 7.
2. T o dominate or interfere with the formation or administration of any labor
organization or contribute financial or other support to it.
87 T h e m a teria l for th e fo llow in g sectio n s w a s d erived from th e first a n n u a l rep ort of th e secon d N a tio n a l
L ab or R e la tio n s B o ard for th e fiscal yea r en d in g J u n e 30, 1936. T h e d iscu ssio n of th e d ecision s o f th e B o ard
is in p a rt p a ra p h rased from ch . X I I D o f th e rep ort.
88 A c t o f Ju n e 6,1935 (49 S ta t. 449). T h e a ct esta b lish ed a n o n p artisan q u a si ju d icia l b oard of th ree m em b ers
a p p o in ted b y th e P re sid e n t, in d e p e n d e n t o f a n y oth er d ep a rtm en t of th e G o v ern m en t, to a d m in ister th e a ct.
W h e n u se d in th is se c tio n , th e ter m “ B o a rd ” refers to th e secon d N a tio n a l L ab or R ela tio n s B o ard , created
p u r su a n t to th e a b o v e p ro v isio n .
89 T h e m a ch in e r y for th e p r e v e n tio n o f un fair lab or p ractices follow s clo sely th e p ro v isio n s o f th e F ed eral
T ra d e C o m m issio n A c t. U p o n th e filin g o f charges th a t an unfair lab or p ractice affectin g com m erce h a s been
or is b e in g en ga ged in , th e B o ard or its ag en t is au th o rized to issu e a form al co m p la in t sta tin g th e charges
an d n o tic in g th e m a tter for h earin g. T h e p erson co m p la in ed o f h a s th e rig h t to file an an sw er a n d to appear
a n d g iv e te stim o n y . In terested p erson s m a y b e p e r m itted to in terv en e. T h e B o ard , u p o n th e b asis o f th e
te stim o n y , sta tes its fin d in gs o f fact an d eith er d ism isses th e c o m p la in t, if fou n d u n su b sta n tia te d b y th e proof,
or issu es a n order req u irin g th e p erson co m p la in ed o f to cease an d d esist from th e un fair lab or p ractices en
gaged in , a n d p o ssib ly to ta k e in c id e n ta l affirm a tiv e action .
O rders o f th e B o ard are n o t self-enforcing. In th e e v e n t th a t a p erson fails to c o m p ly w ith an order issu ed
b y th e B o ard a s o u tlin e d a b ove, th e B o ard m u st p e titio n th e ap p rop riate circu it court of ap p eals an d file
240
CHARACTERISTICS OF COMPANY UNIONS
3. By discrimination in regard to hire or tenure of employment or any term or
condition of employment, to encourage or discourage membership in any labor
organization.
4. T o discharge or otherwise discriminate against any employee because he
has filed charges or given testimony under the act.
5. T o refuse to bargain collectively with the duly chosen representatives of
employees.
Since collective bargaining is carried on through representatives of
employees, the act follows established precedents for the factual de
termination of such representatives. Section 9 (a) provides that
representatives selected by a majority of employees in a unit appropri
ate 100 for collective bargaining shall be the exclusive representatives
of all the employees in such unit for the purposes of collective bargain
ing. The act thus adopted the majority-rule principle which had
been developed in the Houde case.101
The act does not outlaw company unions, nor does it even mention
them, but it prohibits practices which operate to prevent freedom of
organization and collective bargaining. Section 8, subdivision (2),
prohibits employer interference in any “ labor organization.” The
term “ labor organization” is defined in section 2, subdivision (5),
to mean “ any organization of any kind, or any agency or employeerepresentation committee or plan, in which employees participate
and which exists for the purpose, in whole or in part, of dealing with
employers concerning grievances, labor disputes, wages, rates of pay,
hours of employment, or conditions of work.” Thus, no matter what
form the organization takes—employee-representation plan,102 goodw ith th a t cou rt th e record ta k e n before th e B o ard . T h e cou rt is au th o rized to m a k e a d ecree enforcing,
m o d ify in g , or se ttin g asid e th e B o ard ’s order in w h o le or p a rt. In lik e m an n er, a n y p erson a g grieved b y a
fin al order o f th e B o ard m a y o b ta in a sim ila r rev ie w b y filin g in th e ap p rop riate circu it cou rt o f a p p ea ls a
p e titio n th a t th e order b e m o d ified or se t asid e. In all cases, th e fin d in gs o f th e B o ard as to th e facts, if
su p p o rted b y e v id e n c e , are co n c lu siv e o n th e cou rts.
F o r th e p u rp ose o f oral h earin gs a n d in v estig a tio n s w h ic h are n ecessary an d proper in th e exercise o f its
po w ers, th e B o ard is g iv e n a u th o rity to issu e su b p en a s, ex a m in e records, ad m in ister oa th s, h ear w itn e sses,
a n d receiv e ev id e n c e . In case o f c o n tu m a c y or refusal to o b e y a su b p en a , th e B o ard m a y a p p ly to th e
ap p rop riate d istr ict cou rt for a n order c o m p ellin g ob ed ien ce.
T h e ju risd ictio n o f th e B o ard is lim ited to th e in v estig a tio n o f q u estio n s “ affectin g com m erce” con cern in g
th e rep resen tation o f e m p lo y ee s an d to th e p rev en tio n o f u n fair lab or p ractices ‘ ‘affectin g com m erce. ’' T h e
term “ com m erce” is sp ecifica lly d efin ed to in c lu d e in ter sta te or foreign com m erce in th e tra d itio n a l sen se,
ap art from th e T erritories an d th e D istr ic t o f C o lu m b ia . T h e term “ affectin g co m m erce” is d e fin e d to
m ea n “ in com m erce, or b u rd en in g or o b str u c tin g com m erce or th e free flow of com m erce, or h a v in g le d or
ten d in g to lea d to a lab or d isp u te b u rd en in g or o b stru ctin g com m erce or th e free flow o f co m m erce.”
ioo T h e B o ard is au th o rized b y th e a c t to d eterm in e w h eth er th e u n it ap p rop riate for th e p u rp oses o f col
le c tiv e b argain in g in a n y case sh a ll b e th e e m p lo y er u n it, craft u n it, p la n t u n it, or su b d iv isio n th ereof. T h e
B o ard m a y ta k e a secret b a llo t or u se a n y oth er su ita b le m e th o d to ascertain th e em p lo y ees' selectio n of
r ep resen tatives.
See su p ra, p . 226. et seq.
102
M a tte r o f P en n sy lv a n ia G rey h o u n d L in es, In c., an d G reyh o u n d M a n a g e m e n t C o., corp oration s,
a n d L o ca l D iv isio n N o . 1063 o f th e A m a lg a m a te d A sso cia tio n o f S treet a n d E lectric R a ilw a y an d M o to r
C oa ch E m p lo y e e s o f A m erica, 1 N . L . R . B . 1; M a tter o f In tern a tio n a l H a rv ester C o m p a n y a n d L o ca l
U n io n N o . 57, In tern a tio n a l U n io n U n ite d A u to m o b ile W orkers o f A m erica, case n o . C -41.
THE LAW OF COLLECTIVE BARGAINING
241
will club,103 friendship association,104 department councils,105 shop
union 106—if it exists in part for the purpose of dealing with manage
ment concerning the matters thus specified, it is a labor organization
within the meaning of the sections involved. It is obvious that the
existence of employer control of any such organization of the type
described in section 2, subdivision (5), does not prevent the organiza
tion from being termed a “ labor organization” within the meaning
of the act. But by calling such employer-controlled organizations
labor organizations, the act does not mean that they are to be consid
ered genuine organizations of employees on an equal footing with
independent labor organizations. The term is used merely as a matter
of statutory draftsmanship, the purpose of which is to bring all
employer-controlled organizations within the ban of section 8, sub
division (2), no matter what form they may take.107
Em ployer's domination or interference.— The scope of section 8, sub
division (2), of the law, which is concerned with the result of an
employer's activities rather than with the separate activities them
selves, can best be gathered by a description of those activities which
in the individual cases decided under the section have been held to
produce the proscribed result. The first case decided under this sec
tion dealt with an organization in existence prior to the effective date
of the act but continuing thereafter. In Matter of Pennsylvania
Greyhound Lines, Inc., and Greyhound Management Co., corpora
tions, and Local Division No. 1063 of the Amalgamated Association of
Street and Electric Railway and Motor Coach Employees of Amer
ica,108 the respondents were wholly responsible for the formation in
1933 of a labor organization called the Employees Association of the
Pennsylvania Greyhound Lines, Inc., among the maintenance em
ployees, clerical employees, and bus drivers of that company. The
103 M a tter of A tla n ta W oo len M ills an d L ocal N o . 2307, U n ite d T e x tile W orkers of A m erica, I N . L . R . B .
316.
104 M a tter o f C lin to n C o tto n M ills an d L ocal N o . 2182, U n ite d T e x tile W orkers of A m erica, 1 N . L . R . B .
97.
105 M a tter o f W h eelin g S teel C orporation an d th e A m a lg a m a ted A sso cia tio n of Iron, S teel, an d T in W ork
ers o f N o r th A m erica, N R A L o d ge N o . 155, G o od w ill L o d ge N o . 157, R o d an d W ire L o d ge N o . 158, G old en
R u le L o d ge N o . 161, S ervice L o d ge N o . 163, 1 N . L . R . B . 699.
wo M a tter o f A tla s B a g an d B u r la p C o., In c ., a n d M ilto n R osen b erg, organizer, B u rlap & C o tto n B a g
W ork ers L ocal U n io n N o . 2469, affiliated w ith U n ite d T e x tile W orkers U n io n , 1 N . L . R . B . 292; M a tter of
P a cific G rey h o u n d L in es, In c ., an d B roth erh ood of L o co m o tiv e F irem en an d E n g in em en , case no. C -134
(N o v . 12, 1936).
i°7 See M a tter o f A tla n ta W oo len M ills an d L ocal N o . 2307, U n ite d T ex tile W orkers of A m erica, su p p le
m e n ta ry d ecision , 1 N . L . R . B . 328. “ T h is d efin ition (of lab or organ ization ) is clea rly co m p reh en sive
en o u g h to em b race a n organ ization w h ic h is d o m in a ted or interfered w ith , or to w h ic h an e m p lo y er co n
trib u te s fin an cial or oth er su p p o rt, w ith in th e m ea n in g of sec. 8, su b d iv isio n (2). * * * A rev iew of
th e d ecision s th u s far m a d e b y th e B o ard w ill d em on strate th a t b y m a k in g th e essen tial fin d in g u n d er sec.
2, su b d iv isio n (5), th e B o ard d o es n o t in ten d to p la ce th e sta m p o f le g itim a c y u p o n organ ization s w h ich
sh o u ld b e a n d h a v e b een o u tla w ed ."
ms l N . L . R . B . 1.
242
CHARACTERISTICS OF COMPANY UNIONS
uncontroverted evidence set forth in full in the Board's decision showed
in detail the various steps pursued by the company in establishing an
organization among its employees. A letter from one of the executive
officials to the various garage superintendents stated that the “ man
agement has decided to set up a plan of employee representatives"
but that the plan must first “ be requested by the employees." At
the instigation of company officials petitions “ requesting" the plan
were signed by employees and “ accepted" by the company, elections
of employee representatives were conducted under the guidance of
these same officials, preliminary meetings held, bylaws (prepared by
the company) adopted, and an organization formed. This organiza
tion took the form of joint employee and employer representation on
regional committees, presided over by regional managers, which headed
up to a joint reviewing committee. These committees were designed
primarily, if not solely, to handle individual employee grievances and
were not intended to provide an avenue for collective bargaining
concerning wages, hours, and basic working conditions. There was no
employee organization in the sense of an organic body; all employees
were “ members" and participated by voting. A handful acted as
employee representatives. The role of the association as a method
of employee representation was described in the decision in the fol
lowing words:
The association supposedly exists to provide “ adequate representation for
employees before the management.” The “ adequate representation” actually
provided is a mockery. The employees are not permitted to utilize the skilled
services of men outside the employ of the respondents in negotiation with the
management since there has been imposed upon them by the management an
organization whereby only employees may be representatives. The employees
have no regular or established method of meeting with each other and by dis
cussion and debate to formulate the desires of the whole group and then as a
body so to instruct their representatives. Similarly, the representatives have
no established method of consulting with the employees whom they represent.
The representatives are wholly dependent upon the management for their expenses
and financial support. They have been intimidated and discouraged by the
hostility of the management toward any real activity on behalf of the employees
(p. 14).
While there was no doubt that “ historically * * *, the em
ployees' association was entirely the creature of the management"
and that in its functioning it afforded nothing of substance to the
employees in the way of genuine collective bargaining, the issue
presented in the case was whether the respondents after July 5, 1935,
date of passage of the act, dominated or interfered with the admin
istration of the association or contributed financial or other support
to it. The evidence considered in the decision clearly pointed to such
employer activity; this evidence was summarized as follows:
Currently, it is still the creature of the management. All of its affairs are
controlled by the management— its elections are arranged, conducted, and
THE LAW OF COLLECTIVE BARGAINING
243
supervised by the management, the meetings of the regional committees are
controlled by the management so as effectively to prevent any genuine and
free discussion, the choice of matters to be discussed by the general committee
of employee representatives rests with the management through the system of
“ joint submission” , the organic structure is entirely at the control of the manage
ment because of the necessity for its consent to any amendment of the bylaws.
The association is completely supported by the management, so that a cessation
of its financial and other support would leave the association completely penniless
and unable to function. The words “ domination” , “ interference” , and “ support”
are separately inadequate to describe the management’s part in the association.
The totality of the management’s prescribed organic structure of the association
and the management’ s participation results in complete subjugation and control
(p. 14).
Concluding that “ the participation of the respondents in the
association— their domination, interference, and support— are unfair
labor practices proscribed by section 8, subdivision (2)” , the Board
ordered, in addition to the formal cease and desist order, the with
drawal by the respondents of all recognition from the association as
representative of the employees.109
The organization established by the respondents in the Matter of
Pennsylvania Greyhound Lines, Inc.,110 was rather complex, partly
because of the size and nature of the business. Matter of Clinton
Cotton Mills and Local No. 2182, United Textile Workers of Amer
ica,111 involved a simple form of employee organization, both es
tablished by the employer and controlled by it through the direct
activities of supervisory officials. In December 1934 two of the
supervisory officials of the Clinton Cotton Mills formed the Clinton
Friendship Association in order to combat the local of the United
Textile Workers of America that was in existence at the mill. Over
seers and second hands, part of the supervisory force, prepared the
bylaws, presided at the first meeting, constituted some of the first
officers, became members, and attended later meetings. In addition
they systematically and openly solicited the employees to join the
association, such solicitation taking place generally during working
hours. These activities continued after July 5, 1935, and were
reinforced by discriminatory discharges of union members. The
activities of the overseers and second hands culminated in a closedshop contract signed between the employer and the association.
The enforcement of this contract resulted in the discharge of nearly
100 members of the independent union. The Board characterized
this final step in the following words:
As stated above, the participation of the respondent in the association consti
tuted unfair labor practices forbidden by section 8, subdivision (2). In this
case the respondent has gone further and established the association as the exclu108 S ee also M a tter of In tern a tio n a l H a rvester C o. an d L ocal U n io n N o . 57, In tern a tio n a l U n io n ,
U n ite d A u to m o b ile W ork ers of A m erica, case n o. C -41 (N o v . 12, 1936).
no I N . L . R . B . 1.
in 1 N . L . R . B . 97.
244
CHARACTERISTICS OP COMPANY UNIONS
sive representative of all of its employees .for the purpose of collective bargaining.
While the association may now have as members a majority of the employees,
the manner in which such membership was obtained makes it clear that large
numbers of its members have never freely chosen the association. From the
start the membership was obtained practically entirely by solicitation of over
seers and second hands. After July the threat of discharge implicit in such
solicitation was made more concrete by the discharge of union members. And
in August, by manipulation of its puppet, the respondent stripped the situation
of its appearance of voluntary choice and presented its employees with the
clean-cut choice of the association or their jobs. The closed-shop contract and
the purported *‘collective bargaining” by the association were the result of con
certed action on the part of the attorneys for the respondent and the association,
the president of the respondent and the overseers and second hands who con
trolled the association. The employee members of the association were utterly
ignorant of the meaning of collective bargaining and left the entire matter to
their officers. Their officers were equally uninformed, and so they in turn left
everything in the hands of their attorney. On the basis of his own testimony
he likewise was not very familiar with the subject, so that the president of the
respondent and his attorney are left as the informed actors (p. 111).
As a result of the finding that the employer had dominated and
interfered with the administration of the association and had contrib
uted support to it, the Board ordered that all recognition be withdrawn
from the association as representative of the employees; that the
association be completely disestablished as such representative; and
that the closed-shop contract be in effect abrogated.
In the decision in Matter of Clinton Cotton Mills the Board took
occasion to state that the absence of employer control of an organiza
tion is not conclusively proven by pointing to one act of the organiza
tion inimical to the interests of the employer. When the management
of the mill had announced a wage reduction, the association had
protested to the management with the result that the reduction was
not put into effect. In answer to the employer’s contention that this
incident showed the association to be an organization freely chosen
by the employees, the Board said:
The fact that the members of a management-controlled association on one
occasion assert their own wishes does not remove the stigma of the domination.
An organization which is normally entirely under the control of the employer
may well get out of hand if a wage reduction is proposed. The association is
still dominated by the respondent, and it is that domination which the act declares
an unfair labor practice (p. 113).
In Matter of Wheeling Steel Corporation and the Amalgamated
Association of Iron, Steel, and Tin Workers of North America, N BA
Lodge No. 155, Goodwill Lodge No. 157, Rod and Wire Lodge No.
158, Golden Rule Lodge No. 161, Service Lodge No. 163,112 the acts
of the employer, while as effective, were not so open nor was their
purpose so unconcealed as with the Pennsylvania Greyhound Lines
and the Clinton Cotton Mills. In 1934 department councils were
112 1 N . L . R . B . 699.
THE LAW OF COLLECTIVE BARGAINING
245
organized in each of the departments of the Portsmouth plant of the
Wheeling Steel Corporation through the steps of petition by em
ployees, acceptance by management, adoption of constitution and
bylaws of the councils, and establishment of a board of directors of
the councils to handle grievances. On paper the councils were inde
pendent of the employer. But the company had been instrumental
in the circulation of the petitition, had explained its purpose, had
constructed voting booths, had mimeographed the constitution and
bylaws after approving them, and had permitted elections to be
conducted in its offices. Company officials attended meetings of the
councils, expressed a preference for the councils, and informed members
that they would be given advantages in work and working conditions.
After the formation of these councils, the company continued to care
for and foster them. It assisted in maintaining a meeting hall, it
permitted them the use of the bulletin boards, although denying such
use to the lodges of the Amalgamated Association of Iron, Steel, and
Tin Workers of North America. It suggested a general council of
delegates from the various department councils, and its suggestion
was adopted. To this it paid yearly, pursuant to the bylaws of the
general council, 50 cents for every employee in the plant eligible to
vote, whether he belonged to one of the councils, one of the amalga
mated lodges, or no labor organization at all. A monthly sum of $10
was paid to each delegate in the general council. The company also
paid for the services of an attorney for the general council. From
these activities, the Board concluded:
We are convinced that the respondent initiated the formation of the depart
ment councils and the general council, and that by means of financial support, by
favoritism, and subtle devices of coercion is sustaining the life of those organiza
tions. It is true that in form they are independent and that the employees may
on their own initiative espouse and join such organizations. But from the begin
ning employee initiative with respect to the organization and perpetuation of the
councils— even assuming any existed— has been determined by fear of the respond
ent. The power of an employer over the economic life of an employee is felt
intensely and directly; and in the case of a company, which, like the Wheeling
Steel Corporation, has a great number of plants— some idle, some running below
capacity'— this power is enormously increased. The employee is sensitive to
each subtle expression of hostility upon the part of one whose good will is so
vital to him, whose power is so unlimited, whose action is so beyond appeal.
Prior to the organization of the councils, the respondent had emphatically declared
its antagonism to the Amalgamated. Subsequently, it had let it be understood
that the continued operation of the plant depended upon the inauguration of
acceptable labor organizations, which it itself started and in considerable measure
supported by money and by favoritism. As a result, the councils in the minds of
the employees are indissolubly linked with the respondent’s will and desire
(pp. 709-710).
As a consequence of its domination and interference and its con
tribution of financial and other support, the respondent was ordered
246
CHARACTERISTICS OF COMPANY UNIONS
to withdraw recognition from the councils as organizations for the
purpose of collective bargaining upon behalf of its employees.
In Matter of International Harvester Co.,113 the Board indicated
that the Harvester Industrial Council was ineffective as a collective
bargaining agency because of its dependence upon the company for
leadership, financial support, and its very existence.
* * * the whole philosophy of the plan is based upon free discussion
between employer and employees as a method of handling disputes instead of a
resort to direct employee action as a group. It presupposes well-informed
employee representatives and intelligent discussion between them and manage
ment. Yet it is clear that even the sincerest employee representatives are at a
hopeless disadvantage. On one side are management representatives possessing
complete information, statistical and factual, relating to the business and able
to command the resources of a huge and efficient organization. On the other are
employee representatives with no information other than that which their work
ing experience has given them. Intelligent discussion of the complex problems
involved in the fixing of wages, hours, and general working conditions in an
organization of the respondent’s size is impossible under such conditions. The
only possible weapon of the employee representatives— the assistance of outside
experts— is effectively denied to them, since the management controls the purse
strings. The employee representatives at the Fort Wayne Works have never
had the aid of experts. Finally, when a deadlock is reached on any matter, the
employee representatives can do nothing. They possess no funds, no organiza
tion to fall back upon, no mass support.
In holding the plan to be illegal under section 8, subdivision (2) of
the act, the Board stated:
The manner in which fundamental changes in working conditions are made
indicates that the plan does not provide genuine collective bargaining. Such
changes are nearly uniformly ‘ ‘announced” to the works council as accomplished
acts; their formulation is for the management, not the council * * *. No
agreement relating to hours, wages, or conditions of employment has ever been
entered into by the management with its employees. By keeping itself free
from any binding commitments in these fields, so that it may at will make any
changes that it desires, the management has at the same time denied to its
employees the advantages of collective labor agreements. As a result, its
employees possess only the shadow, not the substance, of collective bargain
ing * *
Finally, the plan has no means of independent financial support. No dues
are payable by the employees who participate by voting. All of its expenses
and requirements are met by the respondent. The employee representatives
are reimbursed by the respondent. Such complete management support of the
plan has two immediate consequences. Considering the plan as a functioning
method of collective bargaining, the result of such support is that the manage
ment pays the agent who is supposed to bargain with it on behalf of the em
ployees * * *. The second consequence is just as important. Such com
plete support of the plan makes its existence entirely subject to the will of the
respondent. If it chooses to withdraw its support, the plan collapses at once.
If it chooses to continue its support, the plan continues. The choice as to whether
113
C ase n o . C -41, (N o v . 12. 1936).
THE LAW OF COLLECTIVE BARGAINING
247
representation of employees for collective bargaining shall continue is thus a
choice that rests with the respondent and not with the employees-
In all of the cases above considered the employer had directly
taken an active part in the formation and control of the labor organi
zation. But the Board has recognized that an employer may, by
suggestion and indirection, lead others to bring into being an organi
zation which is subservient, or even favorable, to his wishes, and that
such conduct on the part of an employer is likewise prohibited by
section 8, subdivision (2). Such a situation was considered in Matter
of Ansin Shoe Manufacturing Co. and Shoe Workers’ Protective
Union, Local No. 80.114 After a series of forceful requests by a local
of the Shoe Workers’ Protective Union, a trade-union in existence at
the plant, the company announced that it was going to move its fac
tory from the town of Athol. Immediately a committee of prominent
citizens in the town held various meetings of employees and succeeded
in forming the Progressive Shoe Workers’ Union, restricted to em
ployees in the plant. The company at once entered into a “ union
shop” agreement with this organization. In answer to the company’s
contention that it took no part in initiating or forming the organiza
tion, the Board stated:
We do not so narrowly interpret section 8, subdivision (2), of the act, as to
require this direct and immediate link between the employer and the outlawed
organization. This section does not stand alone; its meaning is derived not
solely from its words but from related sections and from the purposes of the act.
This section makes specific one of the ways in which an employer can interfere
with the broad right of the employees under section 7 to bargain collectively
through representatives of “ their own choosing’ ’ , and is to be construed so as to
further the intention of section 7. Its object is to protect the rights of employees
from being hamstrung by an organization which has grown up in response to
the will and the purposes of the employer, an organization which would not be,
in the sense of section 7, an organization of the employees’ choice. The workers
may be aware of their employer’s antipathy to union organization and seek to
propitiate him by acceptable conduct. This may be unavoidable. But the
employer can be prevented from engaging in overt activity calculated to produce
that result. If labor organizations are to be truly representative of the em
ployees’ interest, as was the intention of Congress as embodied in this act, the
words “ dominate and interfere with the formation of any labor organization”
must be broadly interpreted to cover any conduct upon the part of an employer
which is intended to bring into being, even indirectly, some organization which he
considers favorable to his interests.
* * * Cautiously and discreetly reinforced from time to time by a sugges
tion, a show of power easily understood— yet combined always with the forms of
aloofness and disinterestedness— it has brought forth a union restricted in mem
bership to respondent’s employees, and by the “ union shop” clause, has ousted
the old union and its membership from the plant. This outcome does not flow
from that free choice which our act is designed to foster and protect. It is the
result of fear deliberately provoked and a sufficient suggestion as to how the dis-
11* 1 N. L. R. B. 929.
248
CHARACTERISTICS OF COMPANY UNIONS
pleasure might be appeased. We find that respondent has dominated and inter
fered with the formation of the Progressive Shoe Workers' Union (pp. 935-937) .115
An employer’s activities designed to form a “ labor organization”
are within the ban of section 8, subdivision (2), even though he is
unsuccessful and no “ labor organization” is in fact formed. In
Matter of Canvas Glove Manufacturing Works, Inc., and Inter
national Glove Makers Union, Local No. 88,116 the employer had
urged the employees “ to sign up in what was called a company union” ,
promising them reduced dues, parties, sick benefits, and increased
work rates. The employer desired in this fashion to combat a tradeunion in existence at the plant. However, these activities were un
availing and no labor organization was brought into being. Charac
terizing the evidence as showing that “ the respondent did make a
determined effort to initiate a labor organization and to dominate and
interfere with its formation,” the Board held:
In our opinion, section 8, subdivision (2), of the act forbids domination or
interference not only where it is successful, and a labor organization is actually
formed, but also makes it an unfair labor practice where the domination or inter
ference is unsuccessful. In this case, the respondent was unsuccessful because
of the firmness of its employees. Since the act is remedial, it is appropriate to
require the respondent to cease and desist from unfair labor practices which may,
at some future time, be more successful (pp. 526-527).117
In two cases under this section the Board has held that the evidence
was insufficient to warrant the Board in finding a violation. In the
first, Matter of Mackay Radio & Telegraph Co., a corporation,
and American Radio Telegraphists’ Association, San Francisco Local
No. 3,118 while no labor organization was in fact formed, several
employees had attempted to establish a “ relations committee” to
represent the employees instead of the trade-union already in exist
ence. After a review of the evidence, from which the Board con
cluded that the record might not contain a complete account of the
motives of these employees, the Board dismissed the complaint insofar
as it concerned a charge under this section, since the evidence in the
record did not show that the employer had been involved in the
115 See also M a tter of A n w e lt S h o e M a n u fa ctu rin g C o. an d S h oe W ork ers’ P ro te c tiv e U n io n , L o ca l N o .
80, 1 N . L . R . B . 939; M a tter o f R e m in g to n R a n d , In c ., a n d R e m in g to n R a n d J o in t P ro te c tiv e B o ard of
th e D istr ic t C ou n cil O ffice E q u ip m e n t W orkers, case n o. C -145 (M ar. 13, 1937).
M a tte r o f A tla s B a g & B u rla p C o., In c ., a n d M ilto n R osen b erg, organizer, B u rla p a n d C o tto n
B a g W ork ers L o ca l U n io n N o . 2469, affiliated w ith U n ite d T e x tile W orkers U n io n , 1 N . L . R . B . 292, pre
se n ted a sim ila r, th o u g h cru der form o f em p lo y er p a rticip a tio n in th e form ation o f a n organ ization o f e m
p lo y e es. I n th a t case th e e m p lo y er secu red from th e in d u str ia l secretary o f a ch am b er o f com m erce “ form s”
for th e e sta b lish m e n t a n d org an ization o f a “sh o p u n io n ” w h ic h it th en tu rn ed ov er to on e o f its em p lo y ees.
T h is em p lo y ee , w ith sev eral oth ers, form ed a “ sh o p u n io n ” in accord an ce w ith th ese “ form s” a n d w ith
th e a id a n d en cou rag em en t o f so m e o f th e forem en. T h e em p lo y er th e n “reco gn ized ” th e “ sh o p u n io n ”
a n d its “ collectiv e-b arg ain in g c o m m itte e .”
ns 1 N . L . R . B . 619.
n7 S ee also M a tter o f M a c k a y R a d io T elegrap h C o., a corporation, a n d A m erican R a d io T eleg
r a p h ists’ A sso cia tio n , S a n F ra n cisco L o ca l N o . 3, 1 N . L . R . B . 201, in w h ic h th e B o ard sa id th a t “ an
a b o r tiv e a tte m p t b y a n em p lo y er to form a lab or org an ization is an un fair lab or p ractice w ith in th e m ean in g
of th a t se c tio n (sec. 8, su b d iv isio n (2 ))” (p. 231).
ns x N. L. R, B. 2Q1,
THE LAW OF COLLECTIVE BARGAINING
249
activities of these employees. In the second case, Matter of Atlanta
Woolen Mills and Local No. 2307, United Textile Workers of Amer
ica,119 after reviewing evidence to the effect that the employer had
encouraged membership in a Good Will Club formed early in 1935,
through such devices as use of bulletin boards for notice by the club
declaring a closed shop and solicitation by foremen, the Board held
that the evidence was not sufficient to warrant a finding that the
employer dominated or interfered with its administration, although
such acts were deemed a violation of section 8, subdivision (1). How
ever, on a petition for rehearing by the local of the United Textile
Workers in existence at the plant, the Board indicated that in the
future on a similar state of facts it might reach a different conclusion
with respect to section 8, subdivision (2).120 In addition, on the basis
of the violation of subdivision (1), the Board ordered that the employer
withdraw all recognition from the Good Will Club as representative
of its employees, since the acts of the employer had enabled it to
achieve its large membership.
There also exists the problem of the position of company unions
in an election ordered by the Board. Where two or more rival unions
claim the right to represent the employees, the law provides that an
election shall be held to determine which of the organizations the
employees desire to represent them, and the organizations are each
given a place on the ballot. It may be that the employer has violated
section 8, subdivision (2), of the act, with respect to one of such
organizations. The Board has directed that such an organization be
given a place on the ballot121 unless a charge is filed that the employer
is violating section 8, subdivision (2), of the act, and the Board, after
hearing, finds the charge sustained.
M ajority rule.— The principle of majority rule for the purposes of
effecting collective bargaining has been extended and clarified by the
Board.122 Subject to the provisions of section 9 (a) of the act the
Board has ruled that it is an unfair labor practice for an employer to
refuse to bargain collectively and exclusively with representatives
selected by the majority of the employees in an appropriate unit.
Pursuant to section 9 (c) of the act, the Board may certify the repre
sentatives for the purposes of collective bargaining after investigation,
election, or both. Where certification was made after an election was
held, the certification was made on the basis that a majority of those
eligible to vote had designated the organization certified and that such
organization, pursuant to the provisions of section 9 (a) of the act,
1191 N . L . E . B . 316.
120 M a tter o f A tla n ta W oo len M ills, 1 N . L . E . B . 328.
121 M a tter o f D w ig h t M a n u fa ctu rin g C o., 1 N . L . E . B . 309; M a tter o f N e w E n g la n d T ra n sp o rta tio n C o.,
1 N . L . E . B . 130.
122 S ee p . 227.
154 8 7 5°— 38------- 17
250
CHARACTERISTICS OF COMPANY UNIONS
was the exclusive representative of all employees in such unit for the
purposes of collective bargaining.
In Matter of Radio Corporation of America Manufacturing Co.,
Inc., and United Electrical and Radio Workers of America,123involving
a petition for the certification of representatives pursuant to section 9
(c), although a total of 9,752 employees were eligible to vote, only
3,163 ballots were cast, of which the United Electrical and Radio
Workers of America received 3,016 votes and the Employees Com
mittee Union, 51. The Board certified the United Electrical and
Radio Workers of America as the exclusive representative of all em
ployees in the previously determined appropriate unit for the purpose
of collective bargaining. Here, although the majority of the workers
eligible to vote did not cast ballots, the Board held that the phrase
“ majority of employees” as used in section 9 (a) of the act refers to “ a
majority of the eligible employees voting in the election, so that the
organization receiving a majority of the votes cast is to be certified as
the exclusive representative.124 In discarding the quorum interpre
tation urged upon the Board, the Board stated:
* * * The facts of the instant case are especially important in this regard,
for they illustrate the inadvisability of an interpretation which fastens upon
actual participation of a majority of the eligible employees. Such an interpreta
tion defeats the purpose of the act by placing a premium upon tactics of intimi
dation and sabotage. Minority organizations merely by peacefully refraining from
voting could prevent certification of organizations which they could not defeat in
an election. Even where their strength was insufficient to make a peaceful
boycott effective, such minority organizations by waging a campaign of terrorism
and intimidation could keep enough employees from participating to thwart
certification. Employers could adopt a similar strategy and thereby deprive their
employees of representation for collective bargaining.
In all such situations the purpose of the act would be thwarted. One of its
basic policies is to encourage “ the practice and procedure of collective bargaining’ ’
between an employer and his employees. Section 9 (a), and especially the election
procedure, is designed to promote collective bargaining by means of a prompt
determination of the representative of the employees to carry on that bargaining.
The object of the whole procedure is the elimination of obstructions to the free
flow of commerce caused by the refusal to accept the procedure of collective
bargaining. The realization of that object thus depends upon the efficacy of the
election device as a peaceful means of settling disputes between contesting labor
organizations. If an election is allowed to fail on account of the causes mentioned
above, the result will be the continuation of unrest and strife consequent upon the
doubt as to which organization is entitled to represent the employees. In the
instant case such doubt has already led to a bitter strike which materially dis
rupted the commerce of the company. A failure to certify in this case would
123 C ase no. R -3 9 (N o v . 7, 1936).
184 See p . 252 for recen t ju d icia l d ecision s on cases arising u n d er th e 1934 a m en d m en ts to th e R a ilw a y L ab or
A ct w h ich p a ssed u p o n th e p rob lem o f w h a t c o n stitu te s a m ajo rity w h o se rep resen ta tiv es are e n title d to
sp eak for th e en tire group in m atters of co llectiv e b argaining.
251
THE LAW OF COLLECTIVE BARGAINING
perpetuate the conditions which caused that strike and thereby defeat the intent
of the act. 125
Recent Legislation and Court Decisions 125a
The B itum inou s Coal Conservation A c t. —As previously indicated,
the validity of section 7 (a) of the National Industrial Recovery Act
with respect to the permissible scope of Federal regulation of industrial
relations was not directly passed upon by the Supreme Court in the
Schechter case.126 This issue arose under the Bituminous Coal
Conservation Act of 1934, 127 which was enacted “ to stabilize the
bituminous-coal-mining industry and to promote its interstate
commerce.” The act included certain labor provisions involving the
establishment of maximum hours and minimum wages for the in
dustry. Provision was made that employees be given the right to
organize and bargain collectively through representatives of their
own choosing, free from interference, restraint, or coercion of employers
in respect of their concerted activities.
The Supreme Court in holding the entire Bituminous Coal Con
servation Act unconstitutional passed upon the validity of the labor
provisions as follows:128
The employment of men, the fixing of their wages, hours of labor, and working
conditions, the bargaining in respect of these things— whether carried on separately
or collectively— each and all constitute intercourse for the purposes of production,
not of trade. The latter is a thing apart from the relation of employer and
employee, which in all producing occupations is purely local in character. Ex
traction of coal from the mine is the aim and the completed result of local activities.
Commerce in the coal mined is not brought into being by force of these activities,
but by negotiations, agreements, and circumstances entirely apart from pro
duction. Mining brings the subject matter of commerce into existence. Com
merce disposes of it.
A consideration of the foregoing, and of many cases which might be added to
those already cited, renders inescapable the conclusion that the effect of the labor
provisions of the act, including those in respect of minimum wages, wage agree
ments, collective bargaining, and the Labor Board and its powers, primarily falls
upon production and not upon commerce; and confirms the further resulting con
clusion that production is a purely local activity. It follows that none of these
essential antecedents of production constitutes a transaction in or forms any part
of interstate commerce.
!|e
Sfc
*
*
Much stress is put upon the evils which come from the struggle between
employers and employees over the matter of wages, working conditions, the right
of collective bargaining, etc., and the resulting strikes, curtailment, and irregu125
B u t see M a tte r o f C h rysler C orp oration an d S o ciety o f D e sig n in g E n g in eers, 1 N .L .R .B . 164, in w h ich
th e B o ard refu sed to certify a n organ ization w h ic h receiv ed 121 v o te s in a n election in w h ic h 700 em p lo y ees
w ere elig ib le to v o te p resu m a b ly sin ce th e n u m b er o f v o te s received , alth o u g h a m ajo rity of th o se cast, w as
u n su b sta n tia l in rela tio n to th e en tire u n it.
125a T h e fo llo w in g d iscu ssio n in c lu d e s im p o rta n t d ecision s u p to M a y 1937.
126 S ee p . 238.
127 49 S ta t. 991. P ro v isio n w a s m a d e for a ta x o f 15 p ercen t on th e sale price of b itu m in o u s coal at the
m in e s, u p o n w h ic h th e prod u cer w a s e n title d to a d raw -b ack of 90 p ercen t p ro v id ed th a t h e accep ted the
cod e o f reg u lation s p ro m u lg ated b y th e N a tio n a l B itu m in o u s C oal C om m ission .
728 C a r t e r v . C a r t e r C o a l C o . e t a t . , 298 U . S. 238, 303 e t seq .
CHARACTERISTICS OF COMPANY UNIONS
252
larity of production and effect on prices; and it is insisted that interstate commerce
is greatly affected thereby. But, in addition to what has just been said, the con
clusive answer is that the evils are all local evils over which the Federal Govern
ment has no legislative control. The relation of employer and employee is a local
relation. At common law, it is one of the domestic relations. The wages are paid
for the doing of local work. Working conditions are obviously local conditions.
The employees are not engaged in or about commerce, but exclusively in producing
a commodity. And the controversies and evils, which it is the object of the act to
regulate and minimize, are local controveries and evils affecting local work under
taken to accomplish that local result. Such effect as they may have upon com
merce, however extensive it may be, is secondary and indirect. An increase in the
greatness of the effect adds to its importance. It does not alter its character.
Federal Social Security A c t. — The FederaJ Social Security A c t 129
requires that before the Social Security Board approves the unem
ployment compensation plan of any State desiring to receive the bene
fits of the Federal act, it shall find that, among other things, the State
plan provides that “ compensation shall not be denied * * * to any
otherwise eligible individual for refusing to accept new work * * *
(c) if as a condition of being employed the individual would be required
to join a company union or to resign from or refrain from joining any
bona fide labor organization” (Title IX , sec. 903 (a) 5 (c)). In
compliance therewith the State unemployment-compensation acts
have embodied provisions which guarantee that individuals will not
be refused unemployment compensation when the employment offered
is conditioned upon the individual's joining a company union.130
Although not specifically passing upon this particular provision the
Supreme Court has held the Alabama Unemployment Compensation
Law, which contains such a provision, constitutional.131 The New
York law had previously been sustained in a 4-to-4 per curiam
opinion.132
Court decisions under the 1934 -4 mendments to the R ailw ay Labor A c t .—
The case of V irgin ian R ailw ay C om pany v. S ystem Federation N o . 4 0
arose as the result of an election in which the National Mediation
Board certified that the federation was the accredited representative
of six crafts employed by the carrier. The decree of the Federal Dis
trict Court directed the carrier 133—
to ‘ ‘treat with” the federation and to “ exert every reasonable effort to make and
maintain agreements concerning rates of pay, rules, and working conditions, and
to settle all disputes, whether arising out of the application of such agreements or
otherwise. * * *” It restrained petitioner from “ entering into any contract,
undertaking, or agreement of whatsoever kind concerning rules, rates of pay, or
working conditions affecting its mechanical department employees, * * *
129 49 S ta t. 620.
130 See, for exa m p le, N e w Y o rk C o n solid ated L a w s, art. 18, sec. 506 (1) (a).
131 C a r m i c h a e l v . S o u t h e r n C o a l & G o k e C o m p a n y ; C a r m i c h a e l v . G u l f S t a t e s
868, 301 U . S. 495.
132 W
Co.
v.
. H . H .
Sam e;
C h a m b e r lin , I n c .
A s so c ia te d
v.
A n d r e w s , I n d u s tr ia l C o m m issio n e r o f N e w
In d u str ie s o f N e w
Y o rk
State,
In c.
v.
P ap er
C o r p o r a tio n
Y o rk , et a l.; E .
D ep a rtm en t o f L a b o r o f N e w
S. C t.
C . Ste arn s &
Y o rk et a l.,
U . S. 515.
133 See 11 F . S u p p . 621 for th e o p in io n of th e D istric t C ourt for th e E a stern D istric t of V irginia.
57
299
THE LAW OF COLLECTIVE BARGAINING
253
except
* * * with the federation” and from “ interfering with, influencing,
or coercing” its employees with respect to their free choice of representatives “ for
the purpose of making and maintaining contracts” with petitioner “ relating to
rules, rates of pay, and working conditions, or for the purpose of considering and
deciding disputes between the mechanical department employees” and petitioner.
The decree further restrained the petitioner from organizing or fostering any
union of its mechanical department employees for the purpose of interfering with
the federation as the accredited representative of such employees.134
The Circuit Court of Appeals for the Fourth Circuit affirmed the
decree of the district court.135 The Supreme Court granted certiorari
to review the case.136 The carrier contended that the act as amended
did not impose any legally enforceable obligation upon the carrier to
negotiate with representatives certified by the Board 137 and further
that—
so far as it imposes on the carrier any obligation to negotiate with a labor union
authorized to represent its employees, and restrains it from making agreements
with any other labor organization, it is a denial of due process guaranteed by the
fifth amendment.138
As to the first contention, the Court indicated that the act encouraged
the amicable adjustment of labor disputes and supported that policy
by the imposition of legal obligations. It referred to the Railway
Clerks’ case, supra, in which legal sanction protected employees from
“ coercive interference” in their statutory right to choose their repre
sentatives. Legal sanction, according to the Court, extended to that
provision of the statute which requires the carrier to treat with the
representative of the craft or class certified by the Board as rep
resentative.139
It is, we think, not open to doubt that Congress intended that this requirement
be mandatory upon the railroad employer, and that its command, in a proper
case, be enforced by the courts. The policy of the Transportation Act of encourag
ing voluntary adjustment of labor disputes, made manifest by those provisions
of the act which clearly contemplated the moral force of public opinion as affording
its ultimate sanction, was, as we have seen, abandoned by the enactment of the
Railway Labor Act.
Neither the purposes of the later act, as amended, nor its
provisions when read, as they must be, in the light of our decision in the Railway
Clerks' case, supra, lend support to the contention that its enactments, which are
i3* T h is su m m a ry of th e decree ap pears in th e o p in io n of th e S u p rem e C ou rt, 57 S. C t. 592, 596.
135 84 F . (2d) 641.
136 57 S. C t. 43.
137 T h e carrier’s co n ten tio n th a t th e reg u lation b e tw e e n it an d its “ b a ck sh o p e m p lo y ee s” w a s n o t a regu la
tio n of in ter sta te com m erce, w a s ov erru led b y th e S u p rem e C ou rt. “ T h e a c tiv ities in w h ic h th ese e m p lo y
ees are en ga ged h a v e su ch a rela tio n to th e oth er co n fessed ly in ter sta te a c tiv ities o f th e p etitio n er th a t th e y
are to b e regarded as a p a rt o f th em . A ll ta k e n togeth er fall w ith in th e p o w er o f C ongress ov er in tersta te
com m erce. * * * T h e rela tio n o f th e b a ck sh o p to tra n sp o rtation is su ch th a t a strik e o f p e titio n e r ’s e m
p lo y ees th ere, q u ite ap art from th e lik elih o o d o f its sp read in g to th e op eratin g d ep a rtm en t, w o u ld su b ject
p etitio n er to th e dan ger, su b sta n tia l, th o u g h p o ssib ly in d efin ab le in its ex ten t, o f in terru p tio n o f th e tra n s
p o rtation service. T h e cau se is n o t rem o te from th e effect. T h e rela tio n b e tw e e n th em is n o t ten u o u s. T h e
effect o n com m erce ca n n o t b e regarded as n e g lig ib le.”
138 57 S. C t. 592, 596.
i3° See 1934 A m en d m en ts of R a ilw a y L ab or A.ct, sec. 2, N in th .
CHARACTERISTICS OF COMPANY UNIONS
254
mandatory in form and capable of enforcement by judicial process, were intended
to be without legal sanction.
*
*
*
*
*
*
*
The statute does not undertake to compel agreement between the employer and
employees, but it does command those preliminary steps without which no agree
ment can be reached. It at least requires the employer to meet and confer with
the authorized representative of its employees, to listen to their complaints, to
make reasonable efforts to compose differences— in short, to enter into a negotiation
for the settlement of labor disputes such as is contemplated by section 2, First
(45 U. S. C., par. 152, subd. 1).
With respect to the second contention of the carrier, the Court
stated that the provisions of the act—
as construed by the court below, and as we construe them, do not require the
petitioner to enter into any agreement with its employees, and they do not prohibit
its entering into such contract of employment as it chooses, with its individual
employees. They prohibit only such use of the company union as, despite the
objections repeated here, was enjoined in the Railway Clerks, case, supra, and
they impose on petitioners only the affirmative duty of “ treating with” the
authorized representatives of its employees for the purpose of negotiating a labor
dispute.
Each of the limited duties imposed upon petitioner by the statute and the
decree do not differ in their purpose and nature from those imposed under the
earlier statute and enforced in the Railway Clerks case, supra. The quality of
the action compelled, its reasonableness, and therefore the lawfulness of the com
pulsion, must be adjudged in the light of the conditions which have occasioned
the exercise of governmental power. If the compulsory settlement of some
differences, by arbitration, may be within the limits of due process (see Hardware
Dealers Mutual Fire Insurance Co. v. Glidden Co., 284 U. S. 141, 52 S. Ct. 69, 76
L. ed. 214) it seems plain that the command of the statute to negotiate for the set
tlement of labor disputes, given in the appropriate exercise of the commerce power,
cannot be said to be so arbitrary or unreasonable as to infringe due process.140
As to the majority rule, the Court held that where a majority of
those eligible to vote participated in an election, a majority of the
votes thus cast was sufficient to designate representatives, even though
this did not constitute a majority of all those qualified to vote.141
National Labor Relations A ct sustained by Supreme Court.— On April
12, 1937, the Supreme Court in five cases sustained the constitution
ality of the National Labor Relations Act, and no doubt remains as
to the validity of this legislation in the sphere of manufacture “ affect
ing commerce” , and in proper cases, of the Board’s administration of
the act.142 In disposing of the seemingly contrary holdings in the
Carter and Schechter cases,143 Chief Justice Hughes stated in the
mo V i r g i n i a n R a i l w a y
C o.
v.
S y ste m
F e d e r a tio n N o . 4 0 ,
supra, p . 604.
141W ith resp ect to on e craft in w h ic h a m a jo rity of th o se qu a lified to v o te d id n o t p a rticip a te in th e e lectio n ,
th e d istr ict cou rt h eld th a t for th is reason th e certification o f th e B o ard h a d n o effect. N o ap p ea l w a s ta k en
as to th is craft.
142N a t i o n a l L a b o r R e l a t i o n s B o a r d v . J o n e s a n d L a u g h l i n S t e e l C o r p o r a t i o n , 5 7 S . C t. 615; N a t i o n a l L a b o r
R e l a t i o n s B o a r d v . F r u e h a u f T r a i l e r C o . , 57 S. C t. 642; N a t i o n a l L a b o r R e l a t i o n s B o a r d v . F r i e d m a n - H a r r y
M a r k s C l o t h i n g C o . , I n c . , 57 S. C t. 645; T h e A s s o c i a t e d P r e s s v . N a t i o n a l L a b o r R e l a t i o n s B o a r d , 57 S. C t.
648; W a s h i n g t o n , V i r g i n i a & M a r y l a n d C o a c h C o . v . N a t i o n a l L a b o r R e l a t i o n s B o a r d , 57 S. C t. 650.
143See p p . 238 an d 251.
255
THE LAW OF COLLECTIVE BARGAINING
Jones and Laughlin case involving the discriminatory discharge of
employees:
The close and intimate effect which brings the subject within the reach of
Federal power may be due to activities in relation to productive industry although
the industry when separately viewed is local * * *. In the Carter case
* * * the Court was of the opinion that the provisions of the statute relating
to production were invalid upon several grounds— that there was improper dele
gation of legislative power, and that the requirements not only went beyond any
sustainable protection of interstate commerce but were also inconsistent with
due process. These cases are not controlling here.
$
5jc
*
jfc
H:
Experience has abundantly demonstrated that the recognition of the right of
employees to self-organization and to have representatives of their own choosing
for the purpose of collective bargaining is often an essential condition of industrial
peace. Refusal to confer and negotiate has been one of the most prolific causes of
strife. This is such an outstanding fact in the history of labor disturbances that
it is a proper subject of judicial notice and requires no citation of instances. The
opinion in the case of Virginian Railway Co. v. System Federation No. 40, supra,
points out that, in the case of carriers, experience has shown that before the
amendment, of 1934, of the Railway Labor Act “ when there was no dispute as to
the organizations authorized to represent the employees and when there was a
willingness of the employer to meet such representative for a discussion of their
grievances, amicable adjustment of differences had generally followed and strikes
had been avoided.” That, on the other hand, “ a prolific source of dispute had
been the maintenance by the railroad of company unions and the denial by railway
management of the authority of representatives chosen by their employees.”
*
*
*
*
*
*
*
* * * It is not necessary again to detail the facts as to respondent's enter
prise (the activities of the respondent engaged in the manufacture of iron and
steel). Instead of being beyond the pale we think that it presents in a most
striking way the close and intimate relation which a manufacturing industry may
have to interstate commerce and we have no doubt that Congress had constitu
tional authority to safeguard the right of respondent's employees to self-organization and freedom in the choice of representatives for collective bargaining.
In discussing questions under the due process clause of the fifth
amendment, the Court stated:
As we said in Texas & New Orleans Railroad Co. v. Railway and Steamship
Clerks, supra, and repeated in Virginian Railway Co. v. System Federation No. 40,
the cases of Adair v. United States, 208 U. S. 161, and Coppage v. Kansas, 236
U. S. 1, are inapplicable to legislation of this character. The act does not inter
fere with the normal exercise of the right of the employer to select its employees
or to discharge them. The employer may not, under cover of that right, intimi
date or coerce its employees with respect to their self-organization and represen
tation, and, on the other hand, the Board is not entitled to make its authority a
pretext for interference with the right of discharge when that right is exercised
for other reasons that such intimidation and coercion. The true purpose is the
subject of investigation with full opportunity to show the facts. It would seem
that when employers freely recognize the right of their employees to their own
organizations and their unrestricted right of representation there will be much
less occasion for controversy in respect to the free and appropriate exercise of the
right of selection and discharge.
256
CHARACTERISTICS OF COMPANY UNIONS
To the extent that the activities of employers in the formation,
control, or domination of “ company unions” interfere with the rights
of labor to organize and bargain collectively, and insofar as such
activities constitute unfair labor practices within the meaning of the
National Labor Relations Act, such unions are outlawed. The law
of collective bargaining has definitely evolved to the point where the
rights of labor have received recognition and protection through
statutory sanction.
Appendix II
Case Histories of the Establishment of Company Unions
The following are brief descriptions of the beginnings of 35 company
unions as summarized from the data collected by the Bureau’s field
agents. They are selected as being typical of various procedures and
circumstances. These are followed by summary accounts of the
establishment of those eight company unions referred to in chapter
VII, (pp. 91-92) which showed the greatest amount of employee
initiative. The date at the beginning of each description represents
the date the company union was established. The various company
unions are shown under headings which most nearly describe the
major influences or circumstances attending their formation. These
headings are:
1. Management complies with National Industrial Recovery Act.
2. Management sets up a personnel agency.
3. A company union is set up to forestall a trade-union.
4. A company union is set up following a strike.
5. A company union is set up during a strike.
6. The company signs a contract with a newly established company
union.
7. A benefit society becomes a company union.
8. The company organizes a social club.
9. The company organizes a safety organization.
10. Company headquarters sends in a plan.
11. Local management suggests the plan to an employee.
12. The foremen sound out sentiment for a company union.
13. The company circulates a prepared constitution.
14. The company calls a mass meeting.
15. Management interviews the employees individually.
16. The personnel manager attends the union meeting.
17. The company discharges trade-union members.
18. Eight cases of most marked employee initiative in establish
ment of a company union.
257
1. Management Complies With N. I. R. A.
July 1988.— With the passage of the N. I. R. A. and with apparently no union
ization threatening, management set about introducing a company union. First
a meeting was held with the supervisors to familiarize them with the plan. Then
the foremen called department meetings. A letter from the treasurer explaining
the plan was also posted on the bulletin boards. A secret vote, supervised by
employer and employee tellers, was then taken on the single question, “ Do you
want employee representation?” The vote was 451 yes, 203 no. Three days
later nomination ballots were distributed and nominations made. Four days
after the nominations the election of representatives took place and 2 days later
the successful representatives held their first meeting with the management
representatives.
The meeting was opened with a talk by a company official on the duties of repre
sentatives and what the plan of employee representation should accomplish.
The personnel manager, who acted as chairman, explained that thus far the plan
had been operating tentatively on the basis of a typical plan of employee repre
sentation, and that it would be necessary to draw up and approve a permanent
set of bylaws. A joint committee of four was appointed for this purpose. At
the next monthly meeting the committee brought in its report and the bylaws as
revised were adopted. It was then moved that they be submitted to the com
pany for approval. This approval was immediately forthcoming.
August 1983.— Since 1924 a committee of employees had functioned largely in
connection with suggestions and efficiency. The members of this committee had
been selected by the foremen by means of an informal canvass of employees.
The foreman would ask the men in his department whom they would like to
nominate. He would then pick the four or five most popular and ask each man
which of those he wanted as committeeman. When the N. I. R. A. was passed,
the superintendent suggested to the members of the committee that certain
changes in the existing system be made to conform to the requirements of section
7 (a). Together they drew up a constitution and members of the committee
personally canvassed about 150 of the 1,000 employees. The results of this
canvass were favorable and the first election was held and the constitution printed.
The chief differences between the old and the new system are that there is now
a written constitution, that elections are by secret ballot, and that the functions
of the committee have been increased to include grievances and improvements
by negotiation with management.
2. Management Sets Up an Agency to Improve Personnel Relations
1919.— T h e ---------- Employees’ Congress did not grow out of any labor difficulty
or encroaching unionsim, but rather was the idea of the president of the company,
who was a liberal with advanced ideas on employer-employee relations. The
management selected five employees, who, together with five members of manage
ment, drew up the original plan. A mass meeting was held at which the idea was
presented to employees and accepted by an oral vote.
258
CASE HISTORIES OF COMPANY UNIONS
259
3. A Company Union Is Set Up to Forestall a Trade-Union
May 1984•— Late in 1933, the company had talked representation when it
sensed unrest, but at that time had dropped it. Early in 1934 with militant union
ism making headway, some prospective foremen, apparently on a hint from the
general manager, began asking for a plan. They put their request in writing.
The manager drew up a tentative constitution with joint meetings of employer and
employee representatives. A mass meeting was held at which the president of the
company stated that the trade-union was supported with Moscow gold. That
afternoon they held elections for representatives to consider the plan. The repre
sentatives extracted a 10-percent raise as the price of ratifying the plan and deleted
the joint meeting provisions. The employees then voted upon the plan by signed
ballot. Seventy-one percent voted for the plan. Before the vote 125 men, mostly
union it was claimed, were laid off. These men stated that they had to give up
their union membership in order to get back their jobs. Meantime, the A. F. of
L. organizing campaign had started off with enthusiasm. However, when the
organizers divided the new members up among the various crafts, the members
became disgruntled and dropped out in the face of the company’s strong anti
union attitude.
November 1933.'—An outside union started organizing the employees. After
the president of the company spoke at a mass meeting, at the request of the
employees, a vote was taken to find out their preference. The vote was by secret
ballot and was 4 to 1 in favor of an outside union. This vote was objected to and
a second was taken, supervised by company officials. The result was again a large
majority for an outside union.
Shortly after this a conference was held by a group of employees and the
superintendent of the plant on how to organize and run an inside union. The
testimony is confused as to how this meeting was called. Management states that
a group of employees petitioned for it. Others say that it was called by the super
intendent. At the meeting the superintendent referred the employees to a book
on industrial management and to several employee-representation plans. One
employee stated that he was called to a meeting in the superintendent’s office with
about 10 other workers and that when he came they were discussing ways of
establishing inside unions. The superintendent was explaining the constitution
of a company union in another company. This employee stated that he was
asked to help organize a company union but refused because he belonged to an
outside union and didn’t believe in an inside union. He was laid off later when
difficulty arose and was off almost a year.
About this time the outside union, claiming a majority in the plant, asked for
an agreement and a closed-shop clause. After a delay of some weeks, they were
told that the company would not sign it.
The inside group held a mass meeting and secured the signatures of about 80
percent of the employees. At the same time, the outside union signed up 80 per
cent. An examination of the membership cards shows, of course, many names
which appear on both sets. Some of the employees stated that they were told
there would be a shut-down of the plant and that those who were members of the
company union would be called back immediately, but that those who were not
would be let out. Two months later, the plant was shut down on Friday and
opened the following Monday with only members of the company union at work.
The Regional Labor Board decided that discrimination had been shown and
ordered the other men back. The company rehired the men and also sent a letter
to the trade-union recognizing it as the bargaining agency for its members. But it
continued to favor the company union.
CHARACTERISTICS OF COMPANY UNIONS
260
July 1983.— The American Federation of Labor was organizing about the time
the company union was formed. Meetings of employees were called in the various
departments by the foremen. At these meetings, the employees were told to
choose representatives to confer with management. These delegates were chosen
without a vote, groups of employees simply getting together and making an
informal choice. When this committee of representatives met, management
officials told them that employees as well as employers had to sign the codes and
for this purpose an employees’ organization was necessary. The company pro
posed a plan of representation based on joint councils of employee and manage
ment representatives. The employee representatives rejected this plan and drew
up one of their own. No vote was taken as to whether a majority of the em
ployees accepted this plan, but cards were passed around for those to sign who
wished to become members. Election of representatives by secret vote was held
in January 1934, the election being supervised by the original group of repre
sentatives.
1934.— During the World War the company had an “ industrial democracy”
plan in effect, but it was complex and costly and it was dropped shortly afterward.
In March 1934, employees began organizing their own industrial union to be
affiliated with the American Federation of Labor. They claimed to have had the
shop organized 90 percent when the president of the union suddenly found himself
without a job. Then five employees went to the management and asked for
help in forming an employee-representation plan.
In May 1934 the company held an election. The ballot did not require a
signature— it simply said, “ Do you want your own shop union or do you not?”
Of 230 votes, 136 were against, 85 for, 9 blank. Despite the unfavorable returns,
the company went ahead holding elections in the various departments for repre
sentatives. Elections were held under the direction of the foremen and super
visors. The representatives elected were then handed a constitution which was
almost verbatim from another company in the same city. The representatives
accepted the plan.
Then the company held a vote of employees on accepting the plan. The ballots
had the pay-roll number of each employee on them. The result was 83 for, 73
against, 53 blank.
The Central Labor Union protested over the conduct of the election and another
was arranged to be held jointly by company, company union, and the American
Federation of Labor union. Meanwhile, four more trade-union men, who made
up the union committee, lost their jobs. In this election the company tried to
have the office workers vote, but the trade-union objected. The company did
succeed in having foremen and supervisors vote, although they were not to be
included in the plan. The vote was 115 for the trade-union, 114 for the company
union, 21 for individual bargaining, 1 stray, 6 void.
The company union went right ahead with its membership campaign. The
names of those who signed were posted on bulletin boards in each department.
4. A Company Union Is Set Up Following a Strike
1929.— Following a very serious strike which was unsuccessful the company
established an informal plan of employee representation. It had no written
constitution and no one interviewed knew just how representatives were chosen.
Shortly afterward, a new plant manager came. A strike was threatening at the
time. One of his first acts was to introduce a new company union with a written
constitution. The new plan was drawn up by management on the basis of a
study of three well-known plans. Before submitting the plan formally to the
CASE HISTORIES OF COMPANY UNIONS
261
workers for adoption a straw vote was taken. The straw vote having been
favorable, management submitted the plan to a formal secret vote, conducted
in the plant departments and supervised by the representatives under the old
plan. The vote was 4 to 1 in favor of adoption.
5. A Company Union Is Set Up During a Strike
March 1935.— Conditions in the plant had not been satisfactory. There were
great seasonal fluctuations in employment. Workers felt that division bosses
were arbitrary and disagreeable and there was no provision for remedying any
difficulties or reporting any complaints. It is estimated that approximately
50 percent of the company’s employees joined an American Federation of Labor
local, which had called a strike against the company. Thereupon the company
went out to break the outside union.
Said the business agent of the union: “ After several conferences with the vice
president we found we were not getting anywhere. He kept ‘kidding us along’
until he got his group of men together.” Each employee was called in, one man
at a time, and asked if he was in favor of a committee. The vice president threat
ened to lease out his delivery work, and he forced them to sign a resignation from
the union. The resignation, printed by the plant, read:
I made application to join your union known as Local No. ■
— under false
pretenses and therefore withdraw my application for membership and resign
from the union.
(Signed)---------- -.. — ..After these were signed by the men, they were mailed to the union from the
company office.
The chairman of the company-union committee said: “ The plan was started
because the vice president was worried about the men joining the outside union.
He had a meeting of employees and told them that he didn’t want them to start
a union, that this had been an open shop for 84 years. He suggested that they
have a grievance committee in connection with the mutual-benefit society. This
was discussed in each of the three branches when the vice president visited them.
He said, T have no objection to your joining a union, but this will always be an
open shop. We’ll never recognize any union.’ ”
There was no secret ballot by the employees on acceptance of the grievancecommittee plan. Committee members were elected by employees in a secret
vote held in the company’s branches with the vice president and the general
manager in attendance.
1921.— During a strike, 10 men left the strikers and came back and secured for
themselves an agreement with management that they should have work whenever
any wras available. They and management representatives together drew up the
constitution for the company union.
6. The Company Signs a Contract With a Company Union
1935.— The employees had organized a trade-union and secured an American
Federation of Labor charter. On the advice of the secretary of the local chamber
of commerce, the company attempted to set up a company union in order to break
up the outside organization. A collective-bargaining committee, composed of
foremen, was set up and the company entered into a written contract with the
committee. Shortly thereafter, the outside union called a strike, which ended
with management signing a new agreement with the American Federation of
Labor men, although it did not formally recognize the union. The original
262
CHARACTERISTICS OF COMPANY UNIONS
collective-bargaining committee no longer exists, but management stated that it
hopes to have an employee organization in the near future that will work.
193^.— The outside union was attempting to gain a footing in this company.
According to management, some of the men approached management with the
idea of setting up their own bargaining committee. The manager advised them
to get a lawyer to help draw it up, as the company would not contribute a
penny. Because of the cost involved, the men did not consult an attorney,
feeling that they could do the work themselves. Similar action occurred at the
same time at another unit of the company, about 15 miles away, with no previ
ous communication between the employees at the two units. Separate meetings
were held for the two units and a vote was taken, in one case apparently on
whether or not the men wanted the outside union to represent them. Although
the employees were very largely illiterate, the vote in the latter case was recorded
and subsequently notarized in the following form:
August 10 1934
__________________ W .
Empolies Met and apointed Three to repesent Them Which are
A balot was voted yes for union and no for no union
Yes_________________________________________________________
N o__________________________________________________________
Aug 17--------------------------------------------------------------------------------They want aus to repersent Them
Not a outsider
1
34
14
48
Selection of representatives for the other unit was also notarized, although in
a different form:
August 16th, 1934
To W h o m it M a y C o n c e r n :
This is to certify that we the undersigned,-------------------- a n d _______ ______
have been authorized to represent 43 employees of t h e _______________company
in collective bargaining with said company.
A signed agreement, consisting only of wage rates and having no termination
date, was entered into with each of the two committees. Neither committee
held any further meetings and no provision was made for election of new repre
sentatives at any time in the future.
7. A Benefit Society Becomes a Company Union
1933.— For nearly 10 years the company had maintained a mutual-benefit
society which was governed by a board of nine trustees, four elected by the
employees, four appointed by the president of the company, and the ninth the
president of the company himself, who was ex-officio president of the mutualbenefit society. Early in 1933, two employees were discharged for activity on
behalf of an outside union. With the passage of the N. I. R. A. a new set of
CASE HISTORIES OF COMPANY UNIONS
263
bylaws was adopted which set up a general committee of employee representa
tives for purposes of collective bargaining. The changes were not submitted to
the employees for approval. Pending election of this employees’ committee, a
temporary employees’ committee was established, composed of the four employee
trustees who had been chosen at the preceding election, which antedated the
changes in the functions of the organization. An agreement was signed between
this committee and the company. In March 1934 the first regular election of
employee representatives under the new bylaws took place. Shortly thereafter
a bitter strike broke out, characterized by considerable violence. The com
pany union carried on an active campaign against the outside union; in this cam
paign the company cooperated in various ways. The metamorphosis was
completed in January 1935 with the adoption of a new constitution which com
bined the old benefit-society constitution and the new bylaws, eliminating all
management representation on the governing body of the employees’ organization.
8. The Company Organizes a Social Club
May 1984•— The company has agreements with two craft unions, but these
include only about 5 percent of the employees. The initiative in the organiza
tion of the company union came from the central management. In each plant
the recreational director called the employees together, read them a suggested
form of organization, and announced that those who signed cards for member
ship were to meet later to form a permanent organization. There was no vote
on the plan but almost everyone signed.
Management said: “ We don’t want this club called a union or a company
union. We wanted to give them the finest possible in sports, social affairs at a
low cost, and also provide welfare work. In addition, if a dispute arises, channels
have been opened for each to get to the other. This is secondary.”
October 1933.— The outside union was organizing the men. The assistant
distribution engineer got an employee, who later became the first president, to
organize a company union and get members. The proposal was submitted to
the men to adopt or reject the idea. “ The men thought they were voting on a
social club, not a company union” , said four employees. The men did not see
copies of the constitution before the election. One of the men elected on the first
board of directors said that the supervisory official above referred to read the
constitution to the representatives paragraph by paragraph. They hadn’t
seen it before. When he read the paragraph indicating that the organization
was to handle grievances, there was some objection but the majority agreed to
retain the clause.
9. The Company Forms a Safety Organization
July 1988.— At the time this employee-representation plan was established
shortly after N. R. A., wages had been reduced and there was a strong under
current of dissatisfaction among the company’s workers. Unionization was not
an important factor at the time. The idea for the plan was formulated by the
management and presented to the workers. The foremen passed around an
outline of the plan to the employees in their departments, and then company
delegates passed around the bylaws and got signatures. A former employee,
now a union official, said: “ Safety was the keynote during the formation period,
and the workers didn’t know they had a company union until it was established.”
No secret vote was taken.
264
CHARACTERISTICS OF COMPANY UNIONS
10. Company Headquarters Send in Plans
July 1983.— A representation plan was established during the World War,
but after the war, when the plant closed for a while, the plan went out of existence
through lack of interest. The present employee-representation plan originated
with the parent company. It was established to satisfy the requirements of
N. I. R. A. and was offered to all subsidiary plants of the company. There was no
labor trouble or unionization threatening. The plan was voted upon secretly,
operators going through the plant with ballot boxes. The vote was supervised
by a committee named by the management. Delegates under the plan -were
elected later.
August 1988.— The plan was drawn up in the New York office by the company's
attorney and copies forwarded to all the plants. The local management was very
enthusiastic about the plan and even more receptive as the possibility of union
organization increased. The men had had several meetings and were talking
trade-union affiliation. No vote was taken on the plan. Management posted
notices that elections would be held for representatives.
11. Local Management Suggests a Plan to the Employees
July 1983.— This company originally had an employee-representation plan in
1917 but it was discontinued after a strike. In 1933 management suggested
to an employee the possibility of forming an inside union. The employee had
worked in a company where a plan was in operation and he was for it. He
suggested some other employees for an election committee. They all did con
siderable promotional work prior to the election. The employees voted on the
plan by secret ballot. Ninety percent of eligible employees voted and more than
three-fourths of the votes cast were favorable.
12. The Foremen Sound Out Sentiment for a Company Union
May 1938.— This company had an employee-representation plan for 6 months
in 1919 but it never really functioned. When the present plan was started in
1933 the foremen were told to sound out their men as to whether or not they
wanted such a plan. An election was then held for representatives to draw up a
constitution. Approximately half of the employees participated in the election
of representatives. These then drew up the plan. The employees as a whole
were not given a chance to modify the plan or to vote on its acceptance.
13. The Company Circulates a Prepared Constitution
February 1984.— Unionization was making rapid headway when management
decided to introduce the company union. Before presenting the plan to the
employees for adoption, the plant manager conferred with an N. R. A. compliance
official. Mimeographed copies of the proposed plan, accompanied by a letter
from management explaining the advantages of such an organization, were then
distributed to the employees. A secret ballot was then held at the plant with the
understanding that a two-thirds vote would be required to ratify its establishment.
The required two-thirds was obtained, about 25 percent voting in the negative.
The establishment of the company union, however, did not succeed in halting the
unionization movement. Shortly after its establishment a serious strike broke
out and the company union was discontinued.
CASE HISTORIES OF COMPANY UNIONS
265
September 1988.— A local union, affiliated with the American Federation of
Labor, was attempting to organize employees, but it would have included only
one of the many groups employed. This and the desirability of a collective
bargaining agency in view of the passage of the N. I. R. A. were the chief reasons
given by management as to why it set out to establish a company union.
The employee magazine carried a letter to employees from the president of the
company suggesting the formation of the council, presenting a copy of the proposed
bylaws, and outlining the procedure for electing representatives. This was
followed by a series of conferences in which the plan was explained, first to the
foremen and then by them in separate meetings to their workers. At the same
time notices were posted on the bulletin boards. No vote on adoption of the
plan itself was held.
14. The Company Calls a Mass Meeting
November 1988.— The union was organizing the plant and was having con
siderable success. One of the leaders claimed that 98 percent of the men were
interested. Then a counter movement in favor of an inside union was started.
Management claims that this originated with a group of employees, but there
are many indications that it was instigated by the company. Thus, one employee
claims that he was approached by a minor executive with a proposal to form a
company union, but that he refused because of his union sympathy. A mass
meeting was held in the town high school and the leader of the inside group spoke
against the trade-union and in favor of a company union. The men then asked
that an employee leader of the trade-union group be allowed to speak. In order
to prevent his talking the meeting was adjourned. It was reconvened an hour
or so later and the organization of the company union completed. There was no
general vote of employees on the acceptance or rejection of the plan.
September 1984.— The company union originally came into existence 1 week
prior to N. I. R. A. The object was to be prepared for section 7 (a) and to
counteract the organizing efforts of an outside union. Word was passed through
the mill that there was to be a meeting at the Y. M. C. A. At 7 p. m. the ma
chines closed down, and employees were told to go to the meeting. The organ
izer spoke on how benevolent the company was and said the trade-union organizers
all smoked big cigars and lived in fancy hotels on the dues paid by members.
He promised a raise if they got a majority in favor of the plan. The raise came
after the code and included all but one department, which was 100 percent
unionized.
Immediately after the passage of the N. I. R. A., an American Federation of
Labor union started organizing in this plant. They succeeded in getting a con
siderable portion of the workers signed up. As a result, interest in the company
union died out and no more was heard about it until the time of the general textile
strike in September 1934.
The present plan, called the Workers’ Adjustment Club, was organized during
this strike. All of the employees went out on strike. During the strike the
man who had been active originally in organizing the company union started in
again, along with some of his friends, to interest employees in signing up. He
had a list of employees on whom he or his friends called personally, making a
house-to-house canvass. The workers were told that if they wanted to return
to their jobs, it behooved them to sign up. In this manner, a majority was
obtained by the time the strike ended. Eventually the company union was
put into effect at a mass meeting.
1 54 8 7 5°— 38-------18
266
CHARACTERISTICS OF COMPANY UNIONS
15. Management Interviews the Employees Individually
1933.— Before 1923 a large proportion of the women employees of this com pany1
were organized in an American Federation of Labor union. In that year there
was a strike which resulted in the defeat of the trade-union, although it kept its
charter and a few members. Following the strike, the company instituted com
mittees within each central office to take care of local grievances. These were in
no sense bargaining agencies, since no contact was permitted between the various
local committees. Until 1933 there were sporadic efforts and suggestions by
various committees for some general organization, but this was continually
discouraged by management.
In 1931 the company had called the central-office committees together and
secured their consent to taking a day a week off without pay and to the discon
tinuance of increases. In August 1933 the blanket code went into effect and
employees were put on an hourly rate of pay for 40 hours, instead of the former
weekly rate for 48 hours, thus resulting in a substantial reduction in earnings.
Following this, the committee system broke down. The rank and file held a
meeting at which it was decided that the committee representation was not ade
quate and that they would no longer deal through it but would establish a regular
union and affiliate with the American Federation of Labor. From here on the
struggle became one between the company, which was doing everything in its
power to reestablish the committee system, and those employees who had de
cided to organize. The company resorted to a systematic and persistent series
of personal interviews. In these interviews, it was pointed out to the employees
that a union meant dues, that cuts were necessary because of the depression, that
union membership meant strikes, and that the company preferred the committee
plan. Those who admitted trade-union affiliation were interviewed several times
by company officials. Meantime, the committees were resumed with such people
as the management could persuade to serve without regard to whether or not
they had been elected. Joint meetings were held in the various towns, and repre
sentatives picked by management traveled throughout the company’s territory,
working for the committee plan and staying at the best hotels at the company’s
expense.
The establishment of the revised plan took place in October 1933. The im
portant difference between the old and the new is that now the organization does
not stop with local committees in each central office but includes, in addition, a
hierarchy of district and division committees. No general vote was taken on the
revised system.
16. The Personnel Manager Attends the Trade-Union Meeting
May 1931/..— The American Federation of Labor was conducting an organization
campaign and about 100 employees of the company attended a mass meeting.
The personnel manager of the company also attended. At the next meeting only
three employees were present.
Shortly after this meeting, the formation of the representation plan began.
It started with an employee group which constituted themselves a steering com
mittee. Whether the formation of this group was spontaneous or whether the
idea germinated in the company offices is not clear. At any rate, the personnel
manager provided the committee with half a dozen copies of the plans of other
companies. The committee drew up a set of bylaws and submitted them to man
agement, which made a few changes. Suggested copies of the bylaws were posted
on the bulletin boards and employees were asked to make suggestions for any
i T h e co m p a n y h a d b ran ch offices in m a n y cities
C A S E H I S T O R I E S O F C O M P A N Y U N IO N S
267
changes. No election was held on the acceptance of the plan, but only on the
election of representatives.
17. The Company Discharges Some Union Members
October 1933.— Since the spring of 1933, there had been attempts by different
groups to organize the district and this particular plant. The company did away
with the threat of unionization by eliminating the department in which the most
active trade-union leaders worked. In June 1933 the American Federation of
Labor started organizing the district, and in September a federal local was started
in the company. It was directly after this that the employee association was
formed.
The association started with a suggestion by some of the officers of the com
pany’s benefit association. Management encouraged the idea. A set of tentative
bylaws was drawn up and the company issued a circular to its employees suggest
ing the association and listing the features of the proposed bylaws. A few days
later the employees voted on the proposed association and the vote was 627 for
and 1,143 against. The company announced that “ the results o f the election
* * * fully warrant carrying through t h e ---------- Association” , but did not
announce the vote. Nominations and elections for representatives were there
upon held. At the first meeting of representatives, which was a banquet in a
hotel, the constitution was read section by section and unanimously accepted
by acclamation.
18. Eight Cases of Most Marked Employee Initiative in Establishment
of a Company Union 2
1931}..— This company union was planned during a strike when three or four
employees decided that in their opinion the trade-union “ was run by radicals”
and was not a satisfactory bargaining agency and that they would organize a
company union. Their attorney wrote a constitution and attempted to get an
agreement for them, but the company refused at this time to recognize them or to
negotiate with them.
Shortly thereafter, the trade-union agreement with the company expired and
the National Labor Relations Board held an election to determine who should
represent the employees in collective bargaining. The trade-union obtained a few
votes more than the company union but not a majority of all votes cast, since some
ballots were blank or void. Because the results were so close, the National Labor
Relations Board said that the company might negotiate with either group for its
membership. The trade-union made no attempt to negotiate for its members
only but asked to negotiate for all employees.* The company refused. The
company entered into negotiations with the company union and finally signed
an agreement with it, in which the company agreed to contribute regularly to
the new organization’s treasury an amount equal to the dues collected.
193I f..— The trade-union was gaining strength among the men in two depart
ments. According to an officer of the company union, it started with a meeting
of the men from his department. They were opposed to the frequent rate changes
without notice which had occurred, and they decided to set up an employees’
organization. People from other departments were interested and they studied
the plans from several companies. A committee was set up which asked manage
ment’s permission to proceed in organizing a company union and the company
agreed not to interfere. A petition was circulated and signed by over 50 percent
J See ch , V II, p . 91 f. for d iscu ssio n of th ese cases.
268
CHARACTERISTICS OF COMPANY UNIONS
of the workers. Delegates were elected on company time, with the permission of
management.
The company union received several important concessions from management.
One of these was the check-off privilege. This, the trade-union claimed, had
influenced employees to sign up and had made them hesitate to drop their mem
bership, since company officials knew who were members and who were not.
1983.— The formation of the company union and an organization campaign of
the trade-union started simultaneously after the passage of the N. I. R. A. The
leading spirit in the company-union group was an employee who said that he “ just
thought it up.” This employee has since been promoted to a salaried position
with the company. The management apparently had little to do with it. How
ever, its bitter opposition to the trade-union was well known. It would rather
have had no organization but as between a trade-union and this company union,
it preferred the company union.
Neither, however, made much headway at first. At a Labor Day companysponsored picnic a Congressman spoke in favor of the company union and against
the trade-union. The speech gave an impetus to the company union. When,
later, the trade-union called a strike, the company union urged men to return
to work and join their organization. This brought violence into the picture.
Men were shot at as they were going to work. The shootings, for which the
employees blamed the trade-union, sounded the death knell of the trade-union.
They flocked to the company union and practically all are now members. The
company union provides a check-off of the company-union dues.
1934•— This company union started as a trade-union local. The employees
rebelled against the company’s incentive wage system and decided that the way
to make their stand effective was to affiliate with the trade-union. The organizer
who came in answer to their petition was met enthusiastically by the workers and
cordially by management and enrolled practically all of the employees. He
promised them the abolition of the incentive system and a signed agreement.
The company refused to grant either and relations became strained.
His successor arrived during a period of slack business and lay-off. He com
plained to the Regional Labor Board, without consulting the employees, that
the company was using coercion to break up the organization.
Thereupon a committee of trade-union workers, including all of the officers of
the local, called upon the president of the company and said that they were dis
gusted with the trade-union’s handling of affairs and wanted to form an inde
pendent inside organization. The president of the company is said to have
promised them a signed agreement. He called a mass meeting of the workers
and spoke on the benefits of joining the new organization.
Meanwhile the Regional Labor Board ruled that an election should be held to
determine which group should represent the employees in collective bargaining.
The election resulted in a slight majority for the company union, and thereupon
the employees flocked into the company union and the trade-union “ left the
city.”
1984•— During a strike, back-to-work petitions were circulated by a number of
older workers, several of whom it is claimed were subforemen and salaried men.
Those who circulated and signed the petitions included men who had helped to
break an earlier strike, the memory of which was still bitter; men who were
C A S E H I S T O R IE S O F C O M P A N Y U N IO N S
269
disillusioned by their experience in the current strike; and nonunion workers and
others who resented being deprived of the chance to earn.
At the close of the strike the company union organized, with the signers of the
petition as the nucleus of its membership. At first an active campaign was
waged in the plant. Very soon, however, the company refused to allow either
the association or the trade-union to solicit members in the plant and the cam
paign was conducted from house to house.
Even a trade-union member said: “ There is no direct evidence that company
officials have had anything to do with starting the association.”
1934•— There were at least two very distinct groups of employees in the com
pany. One was organized and the company had, for a long time, negotiated with
it through its trade-union. The other seemed clearly not to want trade-union
affiliation. Many of the men had been with the company for a long time. Some
of them went through an earlier strike and did not want to repeat the experience.
Members of this group went to management after the passage of the N. I. R. A.
and were told that they were free to choose their own method of negotiating.
The assistant personnel director said that “ the only part the company took in
the formation of the union was to give them what literature we had on employeerepresentation plans when they asked for it and to recognize their union when it
was formed.” However, an employee made this interesting comment: “ A lot of
the men who joined this association did so because they thought it was the thing
that the company wanted them to do. I should say that the greater part of the
men wouldn’t want any organization at all.”
1924•— T h e ----------Company Association was formed in 1924 and is an offshoot
of an organization which embraced the workers in the 10 major concerns in the
industry in the city. The older organization, after 4 hectic years of life, ran into
difficulties when putting through a new wage agreement. The employers’
counter-proposal was deemed unsatisfactory, but t h e ----------Company’s men in
the organization approved the terms. The president of the organization, who
was a foreman in t h e ---------- Company, approached the president of the com
pany with a proposal to form a labor-representation plan which would have as
its members all employees of the company from foremen down. The president
of the company agreed to the plan, whereupon the company’s employees with
drew from the old organization, and the company union was launched.
1938.— (For the eighth case in this group see case 4 in appendix III, p. 272,
which describes not only the formation of the company union but also its sub
sequent development.)
Appendix III
Six Case Studies of Changes Made in Existing Company
Unions
Case 1
One of the most independent company unions is the product of a development
dating back to the immediate pre-war period. The original impetus to organiza
tion came from a liberal official of the company, who set up a joint board consist
ing of three representatives each of management and of workers who had been
employed for 3 years or more. The plan was expanded to take in more and more
workers and to provide for a part-time business agent.
Immediately after the World War, a written constitution and bylaws were
drawn up by a lawyer and approved by the workers. The new constitution made
certain significant changes. It provided for a full-time business agent. Twothirds of the requisite financing for the company union was to come from the
employees and one-third from the company. Membership in the company union
was no longer made a prerequisite for participation in the sick and death benefits
provided for the employees.
Only minor changes were made until 1933. In that year the constitution was
rewritten by a college professor on the basis of rulings obtained from the Regional
Labor Board on the questions of majority rule and company support of employee
organizations. The company stopped contributing financially except to the
benefit features. Officials and supervisors were barred from membership, and a
written agreement between the company and the company union was signed.
Case 2
The plan was originally established in 1920 on the initiative of a management
official who was interested in “ industrial democracy.” It provided for automatic
participation with a joint-committee method of functioning. The proposed plan
was submitted to secret vote of the employees and was approved.
Although the company union functioned throughout the period from 1920 to
1933, both management and employees had come to feel that it was not serving
its purpose. The vice president of the company stated:
The old plan grew anemic during the depression. Both sides became dis
gusted with it. It was only for discussion, like most such plans.
With the passage of the N. I. R. A., management decided that it should be
revised in such a way that it would be really effective— that it should be a plan
for settlement, not just discussion.
In June 1933, management prepared plans for revision. The final revision was
worked out by employee and management representatives, and from all accounts
it was a genuine thrashing-out of the situation by both sides. The revised plan
was approved by a secret vote of the employees.
The principal changes from the old were as follows: Employee representatives
were given “ equal representation in the consideration and settlement of policies
of mutual interest” instead of only in the consideration of such matters; the com
pany-union constitution was jointly signed by management and employee repre270
S I X C A S E S T U D IE S O F C O M P A N Y U N IO N S
271
sentatives, and decisions reached by the company-union mechanism were reduced
to written form and signed by both parties; the provision for separate meetings of
employee representatives was expanded to provide for regular caucuses of elected
representatives at company expense; arbitration was made compulsory if re
quested by employees instead of optional with management; representatives
were protected against demotion; supervision of election was placed in the hands
of the employee representatives; a full-time paid secretary responsible to the
employee representatives was provided; the company union was made terminable
only by action of the elected representatives.
Case 3
Under date of June 26, 1933, the company proposed to its employees the estab
lishment of “ an employee representation plan that is being successfully used in
many of our large industries.” Employees were not asked to vote on the plan
but were asked to choose representatives in an election to be held on the following
2 days, June 27 and 28. All employees, except certain specified supervisory
officials, were given the right to vote in the election and it was stated that the
“ plan in no way interferes with membership in any other organization.” It was
stated that the plan would operate through a joint conference of employee and
management representatives. All decisions by the joint conference were to be
subject to review by management. The election was to be supervised by manage
ment and employee tellers.
The employee representatives chosen at this election soon asked for and ob
tained the right to meet separately before the joint meetings with management.
In addition they proposed and obtained management consent to several amend
ments to the original constitution submitted by management. Under the amend
ments, supervisors and group leaders-were added to the list of persons ineligible
to vote or hold office. The recall of representatives was provided. There was
also added a provision permitting amendments to the constitution, although
only by a two-thirds vote of the joint conference and subject to final approval by
management.
In the meantime, two outside unions were increasing their membership among
the employees. A number of employee representatives participated actively in the
trade-union organization movement. Thereupon another group of employee
representatives by the fall of 1933 formed an inside “ employees’ union” with
membership dues of $1 a year. They asked the company to check these dues off
the pay roll, but the company refused.^ They held general membership meetings
monthly in a hall off company property. The executive committee of this
“ employees’ union” conducted conferences with management in addition to
those of the representation plan.
By June of 1934 discussions were under way seeking to unite the group repre
senting the “ employees’ union” with the group favoring the original representa
tion plan. On July 1, 1934, a constitution for an “ Employees’ union plan” was
submitted, providing for the discontinuance of the company’s representation
plan. The new organization was to be a membership organization, with dues of
$1 a year. Employees represented by the trade-unions were ineligible to join.
The constitution could be amended only by the employees’ committee. How
ever, it contained clauses binding management to a certain procedure in adjust
ment and providing that the company would pay employee representatives for
time spent on adjustment work and would not discriminate against the representa
tives. In September 1934, the new organization was set up under the name of the
“ employees’ committee.”
Thus what started out as an automatic-participation company union financed
entirely by management and functioning only through joint conferences whose
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C H A R A C T E R IS T IC S OF C O M P A N Y U N IO N S
decisions were subject to management review became through several changes a
membership organization financed through dues, excluding trade-union members,
and functioning through an employees’ committee.
Case 4
In July 1933 management prepared a company-union constitution based on
automatic participation and joint councils and submitted it to secret vote of the
employees simultaneously in each of its plants. At this particular plant the
proposal was rejected by the employees. Shortly thereafter five employees who
were dissatisfied with the results of the election met and decided to set up a
company union. They adopted, in September 1933, the same constitution as had
been previously submitted by management, making only minor modifications
intended in the main to eliminate references indicating that the same constitution
applied to a number of plants. They retained, however, a section permitting
management to call a meeting of representatives from several plants on matters
considered by management to affect more than one plant. They also retained
the clauses providing that the company w,as to pay the expenses of the company
union. The company union was made terminable by “ mutual agreement”
instead of by either party on 6 months7 notice. The name was changed from
Mill Council to Assembly.
The sponsoring group asked for and obtained the approval of the company.
This included the assumption of the financial obligations involved. The new
constitution was prefaced by the same letter from management as had prefaced
the original plan; in addition it was accepted by the signature of two management
officials and of the employee representatives elected under the new constitution.
The formation of the new agency was not submitted to vote of the employees, but
signatures of those favorable to it were obtained by personal solicitation. At
least gome of the signatures were obtained by foremen. A total of 1,100 out
of the 1,400 employees signed.
At about the same time that this second constitution was issued, an outside
union was attempting organization of the workers with considerable success.
The trade-union demanded recognition as the bargaining agency for the employees.
Management refused, declaring that it did not represent the majority of the
employees. The Regional Labor Board was eventually called in to conduct an
election. The election was held on January 17, 1934. Prior to the election,
advertisements appeared in the local press from the company, the Employees’
Protective Association, as the company union was by then termed, and the out
side union. The advertisements and literJfcure of the E. P. A. were paid for by
management.
The trade-union won 56 percent of the votes. Management, however, pro
ceeded to deal with the company union on the ground that there was no ruling
in the N. I. R. A. prohibiting minority-group dealing if a company chose to do
so along with majority-group recognition.
Sometime between the adoption of the second constitution and the time of the
election, the form of the company union was changed to that of a membership
organization, and its title became the Employees’ Protective Association. Before
the election, the following membership forms were circulated for signature:
APPLICATIO N
I hereby declare myself 100 percent for the Employees’ Pro
tective Association and apply for membership in same.
The new form of the company union was made clear in a third constitution,
entitled “ Rules and regulations of assembly of the employees’ protective asso
ciation” , dated January 1934. The constitution refers to “ members” rather than
S I X C A S E S T U D IE S O F C O M P A N Y U N IO N S
273
“ employees.”
Only “ members” are entitled to vote in the company-union
elections. Six months’ membership in the company union is made a prerequisite
for eligibility as an employee representative, replacing the previous requirements
of 21 years of age, citizenship, and 1 year’s continuous employment prior to
nomination. However, no dues or formal membership requirements were set up.
That membership in the trade-union was to be a bar to company-union member
ship was apparent, however, from the membership application form used by the
company union after the Labor Board election:
I hereby solemnly swear that I desire membership in the Em
ployees’ Protective Association and do not belong to any outside
labor organization, and if I should desire to join any outside labor
organization will notify the Employees’ Protective Association.
(Signed) -------------------------------------------------Subscribed and sworn to before me t h i s ______day o f _______ ,
1935.
Notary Public.
The purpose of notarization, according to persons interviewed, was to permit
the membership list to be used as a basis for certifying the company union as a
bargaining agency for its members.
The third constitution modified the formal participation of management in
the company-union’s affairs in a number of respects. The prefatory letter from
management and the accepting signatures by management were omitted, as was
also a clause giving management the right to call a general council of employee
representatives from a number of plants for the consideration of matters consid
ered by management to involve more than one plant. The power of the president
of the company in determining procedure in handling negotiations was curtailed.
A clause requiring management to pay for printing of minutes was dropped.
Management participation in amending the constitution and in terminating the
company union was eliminated.
The third constitution relieved the company of any financial obligations for
expenses of the company union but made no mention of any means of financing.
Persons interviewed stated that funds were raised by means of various social
affairs to which admission was charged.
Case 5
A small grievance committee was set up by management in 1912. The com
mittee had no definite powers or authority. The membership was rotated at
frequent intervals, appointments being made by management. Four or five
years later, election of the grievance committee by the employees was instituted.
In 1918 the employees’ conference committee was set up. It met by itself once
a month and the following week with the manager of the company. Final deci
sion rested with the manager.
In 1921 an “ industrial democracy” plan, with a house of representatives, a
senate, and a cabinet, was established. It functioned until 1931, when there
was a merger followed by a period of very slack operation. The company union
became moribund.
In 1933 the company union was revived. The management called in some
men who were interested and asked them to form a committee to draw up a new
plan. This committee, together with the employment manager, went over the
old plan and studied a number of other ones. The government form of organiza
tion was dropped. In June 1933 the revised plan was presented to the workers
at mass meeting and a vote taken at the same meeting. The vote was by secret
274
CHARACTERISTICS OF COMPANY UNIONS
ballot and only a few voted against the plan. Practically the same plan was
established in all the other branches of the company.
It provided for automatic-participation rights for all employees in the election
of representatives. There was no provision for membership, dues, or meetings
of the employees. The constitution made no specific mention of how expenses
were to be met. A combination employee-committee and joint-committee
procedure was followed.
Sometime later, with the outside union pressing for recognition and making
certain demands, management called a special session of the joint council in
order to consider a problem raised by the union’s presence. The minutes of the
meeting follow:
e m p l o y e e s ’ r e p r e s e n t a t io n
plan
Minutes of Special Meeting Held June 7, 1934
A special meeting of the industrial council was held at the general
offices of the company, Thursday, June 7, 1934, at 7:30 p. m.
Announcements
A management representative announced that it had been brought to his
attention only today that section 7 (a) of the National Industrial Recovery
Act had been interpreted to mean that all employees in the service of the
company, regardless of their length of service, had a right to vote at any
and all elections and since article IV, paragraph 2, of the employees’
representation plan did not comply with this provision in that it prevented
employees with less than 60 days’ service from exercising the privilege of
voting and pointed out that since it was the intent of the company to
comply with every provision of the act, it would be necessary to declare,
in this instance, an emergency due to nominations being held in several
of the electoral divisions the next day, June 8, 1934, and to pass a resolution
to provide for amending the representation plan, waiving the provision
that no amendment shall be voted upon until 1 month after its introduction.
Employee Representative----------then introduced the following resolu
tion:
“ Resolved, That the proposed amendment to article X V II of the em
ployees’ representation plan be voted upon at this meeting of the industrial
council and that for the purpose of voting upon such amendment all of
the duly elected employees’ representatives, together with all of the
management representatives, do hereby waive the provision of article
X V III to the effect that no amendment shall be voted upon until 1
month after its introduction.”
Representative ---------- then moved that the foregoing resolution be
adopted. On vote, the motion unanimously carried.
The following amendment was then introduced by M r .----------:
“ Resolved, That the employees’ committee propose to the industrial
council that article IV, paragraph 2, of the Employees’ Representation
Plan of th e ----------Corporation----------- be amended to read as follows:
“ All employees, excepting those classified as foremen and bosses, in
article IV, paragraph III, in the employ of th e ----------Corporation----------on the date fixed for any election, shall be eligible to vote.”
Representative -----------seconded the motion that the foregoing amend
ment be adopted. On vote, the motion carried unanimously.
There being no further business to come before the meeting, it adjourned.
Secretary.
At the meeting of the employees’ committee on June 29, 1934, it was reported
that the outside union was going to ask the Labor Board to hold an election.
The employees’ committee thereupon voted to appoint a committee to consider
changes in the representation plan in order to strengthen its legal position under
the N. I. R. A. Two days later, under date of July 1, 1934, the committee
proposed a series of amendments “ to conform to the provisions of the National
Industrial Recovery Act, section 7 (a), and to the rulings of the National Labor
S I X C A S E S T U D IE S O F C O M P A N Y U N IO N S
275
Board as well as to the recent rulings of the Regional Labor Board.’ ’ The amend
ments were adopted at a special meeting of employee representatives held on
July 3,1934, at 1 p. m. At 3 p. m. of the same day a joint meeting of management
and employee representatives unanimously adopted the amendments and a
4‘collective bargaining agreement.” Both parties agreed to waive the constitu
tional provision that “ no amendment be voted upon until 1 month after its
introduction.” The result of the changes was that the constitution of the com
pany union provided for an employees’ committee, while the agreement provided
for a joint committee. The combination of employee and joint committee was
thus continued, but under two separate documents.
On July 18, 1934, the Regional Labor Board held an election to determine the
bargaining agency for the employees and, as of date of July 24, certified the out
side union as the exclusive bargaining agency. The employee representatives, in
regular meeting held on August 10, 1934, protested against the action of the
board in excluding certain votes and empowered its chairman to carry on the case.
Five days later (Aug. 15, 1934) a special meeting of the employees’ committee
was held. The minutes of this meeting follow:
The vice chairman (presiding) announced that a meeting of the special com
mittee appointed by the chairman at the last meeting held Friday, August 10,
1934, to investigate the advisability of forming an employees’ association for the
purpose of furthering the interests of the employees’ representation plan as a
means of collective bargaining with the management and to provide a means for
promoting other activities of mutual interest to the employees,1 met on Monday,
August 14, 1934, and tentative bylaws were drawn up with a view to establishing
such an association.
The bylaws of the employees’ association and application for membership cards
were then read and following discussion, Mr. ---------- moved and Mr. ---------seconded the motion that the bylaws and application cards be accepted in their
present form. On vote, the motion unanimously carried.
Mr. ----------, chairman, then appointed the members of the various electoral
divisions to act as subchairmen of the various departments and instructed them
to enlist the assistance of as many employees as necessary to assit them in the
solicitation of members and also instructed them as to the method and procedure
to be followed in so doing.
There being no further business to come before the meeting, it was moved by
M r .----------and seconded by Mr. ----------- that the meeting adjourn. On vote,
the motion carried.
The bylaws of the employees’ association, consisting of eight brief provisions,
established a membership organization in order, among other purposes—
to promote the interests of the employees’ representation plan and to further it
as a means of collective bargaining with the management * * *.
The duly elected members and officers of the employees’ committee were made
the governing body and officers of the new association, the office of treasurer
being added. Funds were to be raised by “ voluntary contributions, gifts, or
donations” , dues being specifically prohibited.
At the employees’ committee meeting of September 14, 1934, the chairman
explained that—
it would be necessary to raise funds to defray expenses incident to forming the
employees’ association and to defray other expenses in connection with appealing
the case to the National Labor Relations Board.
A finance committee was appointed to circulate petitions for subscriptions
among members, but to do this off company property.
Late in 1934 or early in 1935, certain further changes were made which com
bined the employees’ representation plan and the employees’ association, turn-
1T h e p rin ted m in u tes of th e regular m eetin g m a k e no m e n tio n of a n y su ch d iscu ssio n or o f th e a p p o in t
m e n t o f su ch a co m m ittee.
276
CHARACTERISTICS OP COMPANY UNIONS
ing the former employees’ committee of the representation plan into an executive
board for the employees’ association. An extensive constitution and bylaws was
adopted, providing among other things for membership dues and regular monthly
meetings of the members of the association. The joint council arrangement was
again continued by means of a separate collective bargaining agreement with
management. Thus the procedural arrangements for dealing with management
persisted practically unchanged throughout all these changes in the constitution
and structure of the employees’ organization.
Case 6
There had been a shop committee set up in this plant during the war, but it had
disappeared long before 1929.
The present company union was established in July 1933 following closely
a model which had become famous in the particular industry.
In May 1934 the employees’ committee sent to all employees the following
announcement in printed form, with autographically reproduced signatures of
the councilmen:
To the employees of the •—------ - Company:
In -------— a plan of representation was established by t h e ----------Com
pany and its employees in order to provide effective contact and discussion
of matters pertaining to industrial relations.
During the time this plan has been in effect several changes have been
proposed by your workmen’s council with the result that a revised plan
has been drawn up, by your council, to include these proposed changes,
together with changes that will cooperate with and support to the fullest
extent the National Recovery Act.
We are confident that the proposed changes to the plan will make it more
favorable to our fellow workers, and we therefore recommend its adoption.
On •
— —■—•the management was advised of the changes we desire.
A copy of the revised plan, together with a letter received from the
management, is attached for your consideration and approval.
In order that you may signify your approval, we have arranged for a
vote by secret ballot to be taken on •—■
——.
The committee on rules will arrange for taking the vote, and the ballots
will be counted under the direction and supervision of this committee.
W
o r k m e n ’s
C o u n c il
(Signatures of councilmen autographically reproduced.)
The principal changes proposed were as follows:
The original constitution provided that—
The representation of employees herein provided shall in no way abridge or
conflict with the right of employees to belong to labor organizations
but officials of labor organizations were declared ineligible to act as representatives.
The revision provided that—
This plan shall in no way discriminate against any employee because of race,
sex, or creed, or abridge or conflict with his or her right to belong or not to belong
to any lawful society, fraternity, union, or other organization.
The membership basis was broadened by eliminating citizenship, age, and
service requirements for voting or serving as representative. The secret ballot
was definitely provided.
The clause providing that: “ Representatives will be deemed to have vacated
office upon severing their relationship with the company” was deleted. A recall
provision was inserted whereby a representative “ may be recalled by a twothirds majority vote in his department or unit.”
Nominating primaries were substituted for the provision that outgoing work
men’s representatives are empowered to act as a nominating committee to prepare
SIX CASE STUDIES OF COMPANY UNIONS
277
a list of candidates for the office of representatives, “ to which additional names
may be added by petition of 25 workmen.”
Numerous formal evidences of management participation were removed from
the constitution, although many of these reappeared in an accompanying letter
from the company.
The plan was declared to be established “ by the employees of the company”
rather than “ by the company and its employees.”
Provisions that the company pay employee representatives “ for time necessarily
spent in actual attendance at regular meetings or at special meetings” and that it
defray “ expenses incident to the discharge of the duties” of the rules committee
were deleted.
In the amended plan, no reference was made to compensation of representatives
by the company or the company union, nor was there provision for dues or any
other form of financing.2
The old constitution declared that “ any method of procedure hereunder may
be amended at any time by the mutual consent of the workmen’s council and the
management.” In the new one this clause was changed to read:
Any procedure in this plan may be amended by a favorable vote of two-thirds
of the eligible voters at any general or special election * * *. Such amend
ment shall first be approved by two-thirds majority of the council and submitted
to the employees for their approval at any election under rules prepared by the
committee on rules.
The old plan gave management an equal right to terminate the plan with that
of the workers, as follows:
This plan having been adopted in the belief that it will prove of permanent
value and usefulness, and with the intention that it be given a full, fair, and
honest trial, the plan is entered into subject to the express condition and limita
tion that it may be terminated after June 30, 1935.
(a) Upon 3 months’ notice by the board of directors of the company, if said
board has reason to believe that the mutual benefits anticipated by its adoption
have not been realized;
(b) Upon the expiration of 3 months after a majority of the electors shall
have voted in favor of its termination at a special election called for that purpose,
by a majority vote of the representatives, and held under the supervision of the
workmen’s council.
The new constitution stated that—
This plan shall not be terminated except by a favorable vote of two-thirds of
the eligible voters at any annual convention.
A clause stating that “ the company will provide the necessary facilities for
the proper carrying out of the voting” was deleted, but reappeared in the letter
from the company.
Two sections covering principles and policies governing relations between man
agement and employees and guaranteeing the independence of representatives,
and therefore implying the assent of management, were lifted bodily out of the
constitution and inserted instead in the letter from the company.
However, the statement of procedure in adjustments, which also governed
management participation, was retained in the constitution. A permissive
arbitration clause was added. The earlier constitution had stated that final
decision rested with “ the president of the company or his representative.”
3A t th e w r itten req u est o f th e secretary o f th e co m p a n y u n io n , h o w ev er, th e c o m p a n y gra n ted $500 per
m o n th to th e treasu ry.
CHARACTERISTICS OF COMPANY UNIONS
278
The proposed revisions were sent to the employees accompanied by a letter
of approval from the company and were adopted in a secret vote. The letter
from the company follows:
C
h a ir m a n
I
,
W
o r k m e n
n d u s t r ia l
R
’s
C
o u n c il
e p r e s e n t a t io n
P
l a n
Dear Sir : We have noted with interest the amendment to the present plan of
workmen’s representation which your council has presented and your letter of
May 15, transmitting it. We wish to assure you that the company will be glad to
cooperate fully with its employees to the end that they may have every oppor
tunity of discussion with the management for the purpose of adjustment of any
matters affecting their welfare.
In accordance with your request, until further notice, the company will assist
your organization as outlined below:
I. The general superintendent will meet with the council at such times as may
be mutually satisfactory.
II. The company will provide the necessary facilities to carry out elections
when requested by your committee on rules.
III. The company will provide suitable meeting places where the committee
may hold its meetings.
IV. Matters concerning which the council has not been able to make satis
factory adjustment with the general superintendent may be discussed with the
president of the company.
V. It is understood and agreed that each representative and alternate shall be
free to discharge his duties in an independent manner, without fear that his
individual relations with the company may be affected in the least degree by any
action taken by him in good faith in his representative capacity.
To insure to each representative and alternate his right to such independent
action, he shall have the right to take the question of an alleged and personal
discrimination against him, on account of his acts in his representative capacity,
to any of the superior officers, or to the president of the company.
Having exercised this right in the consecutive order indicated and failing a
satisfactory remedy within 30 days, a representative or alternative shall have the
further right to appeal to the secretary of the State department of labor or the
Secretary of Labor of the United States. The company shall furnish the said
secretary of the State department of labor or said Secretary of Labor of the United
States with every facility for the determination of the facts, and the findings and
recommendations of the said secretary of the State department of labor or said
Secretary of Labor of the United States shall be final and binding.
VI. Regarding the relations of the company with the employees’ organization,
the company will be guided by the following principles and policies:
(a) The management of the works and the direction of the working forces,
including the right to hire, suspend, discharge, or transfer, and the right to relieve
employees from duty because of lack of work, or for other legitimate reasons, is
vested exclusively in the management, except as expressly restricted herein.
(b)
' For offenses other than such as are specifically mentioned, employees shall
not be discharged without first having been notified that a repetition of the
offense will be cause for dismissal. A copy of this notification shall, at the time
of its being given to an employee, be sent also to the general superintendent, and
be retained by him for the purposes of future reference.
(c) The following offenses may be cause for summary dismissal, or other dis
cipline:
1. Violation of any law— special attention is called to the following:
(a) Carrying concealed weapons; fighting or attempting bodily injury to
another employee; drunkenness; bootlegging; habitual use of drugs; conduct
which violates the common decency or morality of the community.
(b) Offering or receiving money or other valuable consideration in exchange
for a job, better working place, or any advantage in working conditions.
(c) Stealing or malicious mischief, such as destroying or hiding any property
of other employee or of the company.
2. Persistent violation of safety rules.
3. Insubordination (including refusal or failure to perform work assigned) or
use of profane or abusive language toward fellow employees or officials of the
company.
4. Absence from duty without notice to and permission from superintendent
or foreman, except in case of sickness or cause beyond his control of a character
that prevented his giving notice.
SIX CASE STUDIES OF COMPANY UNIONS
279
5. Harboring disease that on account of his own carelessness will endanger
fellow workmen.
6. Changing working place without orders or prowling around the works from
assigned place.
7. Falsifying or refusing to give testimony when accidents are being investi
gated, or for false statements when making application for employment.
8. Neglect or carelessness resulting in serious damage to equipment.
9. Willful neglect in care or use of company’s property.
10. Obtaining material at storehouse or other assigned places on fraudulent
orders.
VII.
With respect to any subject covered by this letter, except the matters
included in subsection (a) of paragraph VI, the company will consent to arbitra
tion if satisfactory adjustment of differences is not obtained by negotiation with
the workmen’s council.
Yours truly,
------------------ C
o m p a n y
,
B y ------------------- r ,
General Superintendent.
Appendix IY
Scope and Method of the Mail Inquiry
The figures used in part II of the study, except those for railroads,1
are based upon returns from a questionnaire sent in April 1935 to
approximately 43,000 establishments reporting monthly employment
statistics to the Bureau of Labor Statistics. A total of 14,725 usable
replies was received.2
The canvass covered firms in manufacturing,3 mining, public util
ities, dyeing and cleaning, hotels, laundries, and selected branches of
retail 4 and wholesale 5 trade. The construction industry, because of
its peculiar nature, was not covered by the study, which also did not
extend to water transportation.
The replies accounted for 21.9 percent of the aggregate estimated
employment in April 1935 in the combined industries covered, exclud
ing railroads and telephone and telegraph companies, which are sep
arately treated. The sample for the manufacturing industries was
somewhat larger, covering 26.4 percent of the workers. In the manu
facture of durable goods, the replies covered 28.3 percent of the esti
mated employment; in nondurable goods, 25.0 percent. The smallest
samples were those in the service industries, 10.8 percent; wholesale
trade, with replies estimated as covering 4.4 percent of the employ
ment in the branches circularized; and retail trade, with an estimated
coverage of 9.6 percent of the branches canvassed. Because of the
fairly large number of establishments reporting in the latter groups,
however, it is believed that the data indicate in a broad way the
situation existing in those industries.
The response from establishments in the agricultural implement,
cash register, and aircraft industries accounted for at least 60 percent
of the estimated employment in these industries. On the other hand,
1 T h e m e th o d u sed in d eterm in in g th e e x ten t of th e va riou s ty p e s of em p lo y er-em p lo y ee d ealin g on th e
railroads h a s b een d escrib ed in ch . IV .
2 T h is d o es n o t in clu d e rep lies received from telegra p h an d telep h o n e com p a n ies, w h ic h for reasons d is
cu ssed in ch . I V w ere trea ted sep ara tely.
3 S team -railroad repair sh o p s are grou p ed w ith railroads. E lectric-railw a y rep air sh o p s are com b in ed
w ith electric-railw ay an d m o torb u s m a in ten a n ce an d op eration , sin ce th e retu rn s cov erin g electric railw ay s
d id n o t trea t rep air sh o p s sep ara tely. F o r reason s sta te d in th e sectio n d ealin g th er e w ith , telegra p h an d
telep h o n e co m p a n ies are treated sep a ra tely . A few in d u stries— car b u ild in g , can n in g , tu rp e n tin e an d rosin ,
a n d cru d e-p etroleu m p ro d u ction —w ere d rop p ed b ecau se few rep lies w ere received .
* R e ta il grocery an d m e a t stores, general m erch a n d ise, an d w o m e n 's read y-to -w ear stores.
3 A u to m o tiv e , ch em ica ls an d dru gs, d r y good s a n d ap p arel, electrica l eq u ip m e n t, farm p ro d u cts, farm
su p p lies, an d food p rod u cts.
280
SCOPE AND METHOD OF THE MAIL INQUIRY
281
in the women's clothing, ice-cream, and baking industries the coverage
was less than 15 percent. The sample in these cases was, however,
considered satisfactory in view of the relatively large number of estab
lishments which replied. A few industries— those manufacturing
plumbers' supplies, tin cans, aluminum goods, lighting equipment, furfelt hats, millinery, chewing and smoking tobacco, cigarettes, and
rubber boots and shoes—yielded samples which were not adequate to
warrant separate presentation. Such reports are carried in the mis
cellaneous listings only and are permitted to affect only the group
totals and the grand total. The inadequacy of the iron and steel
figures has already been noted.6
The sample somewhat overrepresents the large establishments.
This is especially evident in the service and trade groups. The em
phasis on large plants exaggerates the proportion of those dealing with
company unions and trade-unions as against firms dealing on an
individual basis; to a less extent, it favors company-union firms over
trade-union firms.
The study is based on replies received from employers only.7 Some
organizations which are actually in both aim and activity purely
mutual-benefit associations may have been classified as company
unions.
N o attempt was made in the study to subdivide the number of
workers in establishments with company unions into those dealing on
an individual basis and those dealing through the company unions.8
Where both a company union and a trade-union existed in the same
plant, the number of workers was carried under a combined companyunion and trade-union heading, since the replies failed to indicate any
adequate basis for subdividing them into those covered by the com
pany union and by the trade-union. In many cases membership in
the trade-union and in the company union was not mutually exclusive.
Office and supervisory forces are not included in the study. Where
companies engage in both the fabrication and the erection of elevators,
bridges, tanks, and similar structures, they are classified here solely
with regard to their dealings with their shop workers, since the workers
engaged in erection work are considered as part of the construction
industry, which is not covered in the present study.
« See foo tn o te 2, ch . III .
? In 121 cases w h ere e sta b lish m e n ts w ere in clu d ed in b o th q u estion n a ire an d field stu d ies, a ch eck on th e
rep lies w a s p o ssib le. In a few o f th ese cases th e field stu d y sh o w ed d ifferen t resu lts from th e q u estion n a ire,
a n d correction w a s m a d e accord in g ly. In th e to ta l retu rn s from q u estion n a ires, w h ic h w ere corrected o n ly
for in tern a l in co n sisten cies, th ere is so m e b ia s tow ard u n d e r sta te m e n t of trad e-u n io n d ealin gs. T h e d is
crep an cies, h o w ev er, are n o t great en ou g h to in v a lid a te th e general resu lts.
8A ll b u t 13 c o m p a n y u n io n s cov ered all th e w orkers in th e p la n t. C overage sh o u ld n o t b e confused w ith
m em b ersh ip . F o r a d iscu ssio n o f th e p a rticip a tio n b a sis o f co m p a n y u n io n s, see p t. I l l , ch. I X .
1 54 8 7 5°— 38------- 19
282
T able
CHARACTERISTICS OF COMPANY UNIONS
34.— Proportion of estimated total employment in April 1985 covered by
replies to questionnaire
C ov ered b y rep lies
In d u str y
Ali industries covered2___ __ _ ______ ___ _________ ___
All manufacturing industries_______________________ _____ ___
Durable goods______________________ __________________
Nondurable goods-------- ------------------------------------------------------------------
E sti m ated
to ta l e m
p lo y m e n t 1
W ork ers
8,884,704 i 1,946,646
5,447,059 i 1,439,586
2,420,496
683,842
3,026,563
755,744
P ercen ta ge
o f to ta l
em p loy m en t
21.9
26.4
28.3
25.0
D u r a b le go o d s
Iron and steel and their products, not including machinery_______
B la st fu rn a ces, ste el w o rk s, a n d ro llin g m ills____ ______ __________
B o lts, n u ts, w a sh ers, a n d r iv e ts ------------------------ ------------C ast-iro n p ip e _________________________________________________________
C u tle r y (n o t in c lu d in g silv e r a n d p la te d c u tle r y ) a n d ed ge to o ls.
F o rg in g s, iron a n d s t e e l, _______________________ _________ __________
H a rd w a re ____________________________________ _________ ___________
P lu m b ers* su p p lie s _____ _______ _________ ____________ ______ ______
S tea m a n d h o t-w a ter h e a tin g ap p a ra tu s a n d ste a m fittin g s ______
S to v e s _______________________________ _____________________ _______
S tru ctu ral a n d o rn a m en ta l m e ta lw o r k ___________________________
T in can s a n d o th er tin w a r e ___________ __________________________
T o o ls (n o t in c lu d in g e d g e to o ls, m a c h in e to o ls, files, a n d sa w s)_ .
W irew o rk ________ _________________________________________________
M isc e lla n e o u s ____________________ _____________ _______ ________
556,528
299,517
11,374
10,643
13,410
14,946
27,962
21,686
45,778
27,318
11,707
23,202
48,985
108,555
51,492
2,949
2,011
5,353
5,050
6,146
4,652
10,755
4, 274
6,447
4,744
4,682
19.5
17.2
25.9
18.9
40.0
33.7
22.0
21.5
23.5
15.6
55.0
20.4
662,069
27,354
14,539
157,682
48,750
303,664
23,149
53,626
20,201
13,104
539,656
9,971
482,837
6,266
40,582
184,851
53,252
17,418
17,419
12,189
26,137
32,403
26,033
327,408
118,609
42,281
166,518
149,984
28,180
18,450
65,752
10,150
27,452
266,291
18,819
14,017
78,505
31,791
84, 578
7,052
18,944
7,447
5,138
127,388
7,517
104,743
3,801
11,327
56, 582
21,823
9, 065
6,323
3,699
4,461
8,210
3,001
77,428
27,147
12,789
37,492
47, 598
6,008
3,707
21,510
2,757
13,616
9.6
40.2
68.8
96.4
49.8
65.2
27.9
30.5
35.3
36.9
39.2
23.6
75.3
21.7
60.7
27.9
30.6
45.7
52.1
36.3
30.3
17.1
25.3
11.5
23.6
22.9
30.2
22.5
81.7
21.3
20.1
32.7
27.2
49.6
Textiles and their products----------------------------------------------------- 1,454,282
977,449
F ab rics (ex cep t h a ts ) ____ ______ ________________________________
C arp ets a n d ru g s ___________________ ____________________
26,815
406,014
C o tto n go o d s ___________ _________________ ____ ___________
14,224
C o tto n sm a ll w a res___________ _________ , _ _______
74,605
D y e in g a n d fin ish in g te x tile s ___________________________
211,684
K n it good s (in clu d in g h o sie r y ) ______________ _________
89,247
S ilk a n d r a y o n g o o d s _________________________________
W o o len a n d w o r sted g o o d s ------------------------------------------154,860
441,371
W earin g a p p arel (ex cep t m illin e r y ) . __ __________ _________
C lo th in g , m e n ’s __________ ______ ________ _
____ 172,543
172,140
C lo th in g , w o m e n ’s ________ _________________________
114,351
C orsets an d a llie d g a r m en ts ---------------- ---------- ---22,260
M e n ’s fu rn ish in g s __ ________ _ ___________ ______
60,077
S h ir ts a n d colla rs___________ _________
_____________________
35,462
M isc e lla n e o u s_______________ ____________
_______ ________
See footnotes at end of table.
329,818
250,434
5,847
103,875
6,901
12,054
50, 516
22,125
49,116
74,452
38,956
19,075
3,022
3,502
9,897
4,932
22.7
25.6
21.8
25.6
48.5
16.1
23.9
24.8
31.7
16.9
22.6
11.1
21.1
15.7
16.5
13.9
Machinery, not including transportation equipment___ ________ __
A g ricu ltu ra l im p le m e n ts________________________ ___________________
C ash registers, a d d in g m a ch in es, a n d c a lc u la tin g m a c h in e s______
E lectrica l m a c h in e r y , ap p a ra tu s, a n d su p p lies____________________
E n g in e s, tu rb in es, tra ctors, a n d w a ter w h e e ls ................................
F o u n d r y an d m ach in e-sh o p p r o d u c ts. _____ ___________________
M a c h in e to o ls__________ __________ ______________ ____ ____________
R a d io s a n d p h o n o g ra p h s_________ _____ ____________________________
T e x tile m a c h in e r y a n d p a rts_________________________________________
T y p e w r ite r s a n d p a r ts . ..................... .......................................... ..................
Transportation equipment_____ ______________________________
_ _ _ _ _______
A ir c r a ft ____ ______ _
A u to m o b ile s ______________________ _
________ _______
L o co m o tiv es _____
__ _____ _ _ ________ _ _______
S h ip b u ild in g , ___ _ __________________________________
Nonferrous metals and their products, _____ _____ ______ __
B ra ss, b ron ze, a n d cop p er p r o d u c ts __
_________ _______
C lock s a n d w a tch es an d tim e-record in g d e v ic e s_____ _ __________
J e w e lry ____________________ ______________________________ ___________
S ilv erw a re an d p la te d w a r e__________ _ , __ _______ ______ _
S m e ltin g a n d refin in g— cop p er, le a d , a n d z in c ----------- ------S ta m p e d a n d e n a m eled w a re________________________________________
M isc e lla n e o u s_____ _________ _ ___________________________
Lumber and allied products,__ ____ ____ ______ _______
F u rn itu r e _________ _______ _ _______ _ _ _
__
L u m b er:
M illw o r k _______________ __ __
___ , ___ _________
S a w m ills ____________________ ______________________
Stone, clay, and glass products____ _____ __ --------------------B r ic k , tile , a n d terra c o tta ----- --------------------------------------C e m e n t ___________________ _ _____ ___ _____ ________
_ -G la ss______________________ _____ _____________ _______ _ M a rb le, g ra n ite, sla te , a n d o th er p r o d u c ts___ ___________________
P o tte r y _______________ ________________________________________________
N o n d u r a b le g o o d s
SCOPE AND METHOD OF THE MAIL INQUIRY
283
T able 34.— Proportion of estimated total employment in April 1985 covered by
replies to questionnaire— Continued
C ov ered b y rep lies
In d u str y
N o n d u r a b l e g o o d s — C ontinued
Leather and its m anufactures_________________________________________
B oots and shoes___________________________________________________
L eather_______________________ ____________________________________
Food and kind red products____________________________________________
B ak in g____________________________________________________________
B everages (including brew eries)__________________________________
B u tter_____________________________________________________________
C onfectionery_____________________________________________________
F lou r______________________________________________________________
Ice cream __________________________________________________________
Slaughtering and m eat p acking__________________________________
Sugar, b eet------------------------------------------------------------------------------------Sugar refining, cane____ _______ ___________________________________
Cigars___ _________________ ____________________________________________
P aper and printing____ _______________________________________________
B oxes, paper______________________________________________________
Paper and p u lp ___________________________________________________
P rinting and publishing:
B ook and job_________________________________________________
N ew spapers and periodicals__________________________________
C hem icals and allied products, and petroleum refining______________
O ther th an petroleum refining____________________________________
C hem icals________________ ______ _____________________________
C ottonseed—oil, cake, and m eal______________________________
D ru ggists’ preparations______________________________________
E xplosives____________________________________________________
F ertilizers_____________________________________________________
P ain ts and varnishes_________________________________________
R ayon and allied products___________________________________
Soap___________________________________________________________
Petroleum refin in g .-______ __________ __________ _________________
R ubber products (except boots and sh oes)____________________________
R ubber goods, other th an boots, shoes, tires, and inner tu b es___
R uber tires and inner tu b es______________________________________
M iscellaneous nondurable g oo d s 3_____________________________________
Service______ _____________ ____________________________________________
L aundries_________________________________________________________
D yein g and cleaning______________________________________________
H otels_____________ _______________________________________________
P ub lic u tilities _____ ________________________________________________
E lectric railw ays__________________________________________________
L igh t and pow er__________________________________________________
M ining and quarrying_________________________________________________
B itu m in o u s coal---------------------------------------------------------------------------A nthracite________________________________________________________
M eta l_____________________________________________________________
Q uarrying____________ ____________________________________________
Retail trade (selected groups)_________________________________________
General m erchandise group_______________________________________
G rocery, m eat, and produce stores________________________________
W om en ’s ready-to-w ear___________________________________________
W holesale trade (selected groups ) 5........... ...........................................................
E stim a te d
to ta l e m
p lo y m e n t
W orkers
244,733
193,041
61,692
446,661
181, 663
43,524
13,376
48,422
24,867
16,100
103,261
3,239
12,319
51,809
39,916
11,893
86, 586
19,929
19,102
2,543
11, 338
5,328
2,036
22,248
1,080
2,978
(3)
413,311
48,763
132,419
115,930
116,199
278,024
207,846
60,933
7,772
9,099
4,991
28, 731
26,099
53,584
16, 637
70,178
99,017
42,318
56,699
90, 535
469, 800
186,600
47, 200
236,000
460,415
196,115
264,300
509,400
340,800
75,100
50, 600
42,900
1,385,308
770,100
518,701
96, 507
612,722
(3)
111, 748
11,612
51,922
25,625
22,589
105,626
73,172
17,138
1,959
2,751
2,749
8,056
8,752
26,832
4,935
32,454
53,109
11,644
41,465
17,048
50, 586
27,007
4, 604
18,975
111,236
53,573
57,663
185,035
139, 264
19,963
12, 736
13,072
133,131
101,563
23,876
7,692
27,072
P ercen ta ge
o f to ta l
em p loym en t
21.2
20 .7
23 .0
19.4
11.0
43.9
19.0
23.4
18.8
12.6
21 .5
33.3
24 .2
(3)
27.0
23.8
39 .2
22.1
19.5
38.0
35 .2
28.1
25 .2
30.3
55.1
28.0
33.5
50.1
29.6
46 .2
53.6
27.5
73.1
18.8
10.8
14.4
9 .8
8.0
24.2
27.3
21.8
36.3
40.9
26 .6
25 .2
30.5
9 .6
13.2
4 .6
8.0
4 .4
1B a sed o n e stim a te s o f th e B u rea u of L a b or S ta tistic s.
a T h e se figu res differ so m ew h a t from th e corresp on d in g figures in ch. III . T h e figures in th is ta b le do n o t
in c lu d e rep lies cov erin g 23,333 w ork ers in “ M iscella n eo u s m a n u fa ctu rin g in d u str ie s’’ (see ta b le 2), for w h ich
n o com p a ra b le e stim a te o f e m p lo y m e n t w a s a v a ila b le. O n th e oth er h a n d , ta b le 34 in c lu d e s 34,306 w orkers
in 4 a u to m o b ile p la n ts w h ic h are ex clu d ed from th e ta b le s in ch . I l l for reason s in d ic a te d th ere (footn ote 3,
p . 36).
3N o e m p lo y m e n t e stim a te s w ere a v a ila b le for cigars sep ara te from ciga rettes. T h e c o m b in ed figures
for cigars a n d ciga rettes are th erefore in c lu d e d u n d er th e “ M iscella n eo u s n o n d u ra b le go od s in d u stries’’
h ea d in g .
* E x clu d in g telep h o n e a n d telegra p h a n d railroads.
8A u to m o tiv e , ch em ica ls a n d d ru gs, d r y go od s a n d ap p arel, electrica l e q u ip m e n t, farm p ro d u cts, farm
su p p lies, a n d food p rod u cts.
284
CHARACTERISTICS OF COMPANY UNIONS
Copy of Mail Questionnaire
Do you wish us to send you a copy of the completed report?
B . L . S. 865
Yes___
N o____
U N IT E D ST A T E S D E P A R T M E N T OF L A BO R
BUREAU OF LABOR STATISTICS
WASHINGTON
IN D U STRIAL RELATIONS M A CH IN ER Y
1. Do you deal with your employees on an individual basis? Yes______
N o______
□ (a) Through a personnel manager.
□ (6) Through foremen or shop superintendent.
2. Do you deal with any group of your employees through a trade-union?
Yes______ N o______
(If more than one union, please attach separate statement answering
(fl) ( b ) (c ).)
(a) Name of union_________________________________
(b) How long have you been dealing with this union?_________________
(c) Do you have a union agreement? Yes______ N o______ Date of
expiration_____________________
3. Do you deal with your employees through an employees7 association or
employees7 representation plan? Yes______ N o--------(a) When was it originally established?--------------------------------(b) Has it been reorganized since 1929? Yes__________ N o_________
Date_____________________
(c) What major changes were made by the reorganization?______________
IF
YO U
H AVE
AN
E M P L O Y E E S7 A S SO CIA TIO N
OR
E M P L O Y E E S7 R E P R E SE N T A TIO N
P L A N , PLEA SE A N S W E R TH E FO LLO W IN G
4. What proportion of your employees are members of association or plan?
5. How do employees become members?_____________________________________
6. Do members pay dues? Yes_________
N o__________
How much? (per
month)_____________________ (per week)______________________
7. How frequently are general membership meetings held?_____________________
(a) By departments?_____________________
(b) By entire plant?_____________________
8. How frequently do representatives meet?_____________________
9. Are employee representatives paid for time while attending to association
duties? Yes______ N o______
(a) How much?_____________________
(b) By company?_____________________
(c) By membership dues or assessments?_____________________
10. Do employee representatives have any contacts or meetings with employee
representatives of—
(а) Your other plants? _____________________
(б) Other companies? _____________________
11. Do you have a written agreement signed by management and employees7
representatives? Y e s ____ N o ____ Date of expiration----------------------(Please send copy of agreement.)
SCOPE AND METHOD OE THE MAIL INQUIRY
12.
285
If you have no written agreement, how are decisions on results of negotiations
recorded and announced? (Please send sample copies, if available.)
13. With whom does final decision rest on matters brought up for negotiation?
□ (a) General manager. □ (6) Board of directors. □ (c) Others (specify).
R em a rk s:________________________________________________________________
14. Does your plan provide for outside arbitration when agreement cannot be
reached between management and employee representatives? Y e s ______
N o ______
If so, under what conditions? (Please specify)____________________________
15. Check matters which have been negotiated by the management with repre
sentatives of employees’ association or plan since January 1, 1933:
□
□
□
□
□
□
(a)
(6)
(c)
(d)
(c)
(/)
In d iv id u a l grieva n ces an d co m p la in ts.
M e th o d s o f sh arin g or ro ta tin g w ork .
R u le s o f sen io rity .
H e a lth a n d sa fety .
G en eral ru les a n d reg u lation s.
D isch a rg e o f an e m p lo y ee or em p lo y ees.
□ 0) C h an g es in w e e k ly or d a ily hours.
D ( h ) T y p e o f w ag e p a y m e n t (p iece w ork , b o n u s,
e tc .).
□ (i) W ag e rates for sp ecific o ccu p ation s.
□ O') G eneral w a g e in creases or decreases.
Remarks: ________________________________________________________________
16. Check activities listed below which are administered and financed by the
employees’ association or plan. Double check if administered or financed
jointly with employer.
□
□
□
□
□
□
(a)
(6)
(c)
(d)
(c)
(/)
S ick b en efits.
S a v in g s a n d loa n p la n .
R esta u ra n t an d cafeteria.
C oo p era tiv e p u rch asin g.
S a fe ty a n d accid en t p rev en tio n .
S u g gestion sy stem .
□ (*/) L ib rary or rea d in g room s.
R ecreation a l a c tiv ities,
□ (i) G rou p in su ra n ce.
□ O') S to ck p u rch ases.
□ (/c) P ro fit sharin g.
□ (/) O thers (sp ecify).
U (h )
PLEASE SEND COPY OF CON STITU TION OR O TH ER R E L E V A N T PRINTED M ATTER
(N a m e of esta b lish m e n t covered b y th is report)
(S ign a tu re o f person m a k in g report)
(Location)
(Position)
Appendix V
Scope and Method of the Field Study
The study presented in part III covered 126 company unions in
125 companies.1 An attempt was made to have the coverage repre
sentative of company unions in general from the standpoint of age,2
industry, size of plant, region, and form of company union. A list
of firms reported to be dealing with their employees through company
unions was compiled from various sources. From this list a sample
considered to be representative was selected. In general, company
unions which had already been studied in detail by other agencies
were omitted from this selection. A comparison with the much
larger group covered in the mail-questionnaire survey (part II) would
seem to indicate that the 126 company unions were representative of
company unions in general, and that the field study may be considered
a qualitative interpretation of the quantitative results obtained on the
basis of the mail questionnaire.3
The Bureau’s field agents were instructed to interview several key
people of the following groups: Management, company-union repre
sentatives, rank-and-file workers, trade-union members employed in
the plant or having first-hand contact with the operations of the
particular company union, State and Federal representatives entrusted
with handling labor relations who were familiar with the operations
of the company union, and detached observers, such as professional
men and women. A detailed questionnaire was prepared for these
interviews.4 The representatives also had instructions to obtain
sample copies of company-union minutes, official documents, and other
pertinent literature.
In order to permit a complete and effective study of the company
unions, the permission and cooperation of management was sought in
each case. The great majority of firms solicited gave wholehearted
and unstinting cooperation. In only six cases were the field agents
unable to obtain interviews with management. In all other cases,
1In on e c o m p a n y th ere w ere tw o c o m p a n y u n io n s so d ifferen t in h isto r y a n d fu n ctio n in g as to req u ire
sep ara te trea tm en t. T h e y are, th erefore, trea ted a s sep ara te co m p a n y -u n io n cases.
2F or d iscu ssion o f th is p o in t, see ch . V I, p . 79, fo o tn o te 4.
2O ne sig n ifica n t d ifferen ce b e tw e e n th e sa m p les cov ered b y th e tw o stu d ie s is th a t th e field s tu d y d id n o t
in c lu d e a n y ex a m p les o f th e fed erated ty p e o f c o m p a n y u n io n , su c h as th e L o y a l L e g io n o f L oggers an d
L u m b erm en . T h e effect of th is d ifferen ce u p o n th e d a ta rev ealed b y th e tw o stu d ie s is p o in te d o u t a t va riou s
places.
4See p p . 293-300 for c o p y of th is q u estion n a ire.
286
SCOPE AND METHOD OF THE FIELD STUDY
287
one or more management officials were interviewed. Excepting
company-union officials, the largest number of interviews was obtained
from management.
It was not always possible to get satisfactory interviews with
employees. In 85 of the 125 establishments covered, management
permitted the Bureau’s agents to interview employee representatives
and workers without any interference or interruption. But even in
these cases it was not always possible to secure the opinion of the
workers. In some instances workers hesitated to express opinions
while on company property. One field agent was visited at his hotel
in the evening by a worker who contradicted statements he had made
earlier in the day in an interview at the plant. The field agents
tried to minimize this obstacle by interviewing the men at home or
outside the plant insofar as possible, but most of the interviews
were necessarily conducted in the office or the factory.
For the remaining 40 companies the expressions of workers’ atti
tudes are less adequate. In some cases this was due to manage
ment officials. In two cases the field agent was given a room in which
to conduct his interviews, but a company official would occasionally
drop into the room to inquire about progress, or to obtain papers from
the files. Even though this was done in complete good faith and with
no intent to sway the testimony, workers might feel hampered in fully
expressing themselves. In three other cases there seemed to be an
attempt on the part of the company to select the persons interviewed
and to coach them on the replies they should make. In nine com
panies management insisted upon having a representative present
when employee representatives and rank-and-file workers were being
interviewed. In such cases, the management representative usually
took it upon himself to supervise and conduct the interview, or to
coach the persons interviewed. The following excerpt from a fieldagent’s report illustrates this problem in an extreme way:
The personnel manager was very amiable and wanted to supervise all inter
views. He selected the men to be interviewed, brought them into his office,
prompted them in their answers, and explained to them that he was their “ guard
ian” in these matters * * * . He gave each man he called in a cigar and
tried to handle the interview in his way.
In two cases the employer would permit his employees to be inter
viewed only on condition that he be allowed to read the reports.
Since all information was secured in confidence and the field agents
were under oath not to reveal such information, this request could
not be granted. In one case management was induced to withdraw
its request; in the second, the company union was dropped altogether
from the study.
In 15 of the 40 instances management gave its version of the organ
ization and functioning of the company union but refused to permit
288
CHARACTERISTICS OF COMPANY UNIONS
either employee representatives or other employees to be interviewed.
Various reasons were given for this refusal. The management of one
company, with a long established company union, said that the entire
plan could be covered from their records and that it was not necessary
to see the employees. Another company said that “ the workers are
satisfied, and there is no use stirring them up and putting ideas into
their heads.”
In 24 cases management refused permission to study constitutions,
minutes, or other documents of the company union, or otherwise
withheld information asked for. In one instance, the reason given
was that “ so many amendments had been made to the constitution and
the management did not know what they were.” In another instance
the chairman of the company union, on the advice of the vice president
of the company, refused to show the agent the minutes of the employeerepresentative meetings and records of cases, stating that these records
were not made public to all the workers.
Although the general reception accorded the field agents was
cordial and cooperative, in about a third of the cases included in the
study more or less serious limitations were encountered. The in
formation obtained in these 40 cases was adequate enough to permit
inclusion on most if not all points. The limitations tended on the
whole to restrict the expression of views unfavorable to the company
union. When complete noncooperation was encountered or the
information furnished was very meager, the cases were entirely ex
cluded from the study.
The field agents held 700 interviews, distributed as follows among
the various groups: Management, 198; company-union officials and
representatives, 217; rank-and-file workers, 171; trade-union officials,
101; Government officials, 6; outsiders, 7.
There was thus an average of about five and one-half interviews per
company union studied. In almost all cases these were separate and
independent interviews. In a few cases one schedule was used to
record information obtained from three or four employees in a joint
interview. Twenty-seven partial interviews were also obtained, as
well as numerous briefer contacts with workers, either during working
hours or after work. In addition, the field agents obtained copies of
the company-union constitutions in 97 cases 6; of the written agree
ment between the company union and the company in 18 cases 6; of
minutes and reports of meetings of company-union representatives and
of the general membership in 41 cases;7 of house and company-union
6 W r itten c o n stitu tio n s w ere rep orted for 106 c o m p a n y u n io n s.
® W r itten ag reem en ts w ere rep orted in 19 cases.
7 T h e se m in u te s cov ered , in alm o st a ll cases, p eriod s of m ore th a n a quarter of a year an d in so m e cases th e
e n tir e p eriod of th e c o m p a n y u n io n ’s ex isten ce. T h e co m p a n y u n io n s w h ic h su p p lied m in u tes w ere, ju d g ed
b y va riou s criteria , clea rly th e m ore a c tiv e on es.
SCOPE AND METHOD OF THE FIELD STUDY
289
organs in 26 cases; of newspaper and other clippings in 21 cases; and
of miscellaneous material, including application cards, membership
cards, ballots, handbills, and similar material in 97 cases. In only 11
cases was no supplementary material obtained.
Not all of the 126 company unions were functioning at the time of
the field agent's visit. A few were dormant or had been abandoned.
In three cases the company union had recently been replaced by tradeunion dealing; in another the trade-union had captured the companyunion mechanism. Since the recent history in these cases served to
illustrate the principles and problems involved in company-union
situations, they were included in the study. One case was included
because management had expressed its intention of having a company
union, had already selected the worker to be head of it, and was laying
the foundations for the organization of the company union. The case
thus illustrated the procedure employed in some companies to build
up a company union.
The 125 establishments covered by the field agents represented a
total of 231,042 workers, exclusive of office and supervisory forces.8
Ninety-eight of the companies, representing nearly 80 percent of
the total, were in manufacturing industries. (See table 35.) Eleven
were in public utilities, seven in mining, five in retail trade, and two
each in wholesale trade and the service industries. This order of
importance corresponds rather closely to that represented in the mailquestionnaire study, except that company unions in retail trade are
not as well represented in the field study. In terms of industries
covered, the field study thus reflects fairly well the distribution by
industrial groups within the larger mail-questionnaire study. Within
the manufacturing group, company unions in the durable goods are
somewhat under-represented in the field study. This under-represen
tation is principally in the lumber and allied-products industries, and
is very largely a result of the fact that almost all of the company unions
in this industry are connected with the Loyal Legion of Loggers and
Lumbermen, which was not covered in the field study.
8
I t th u s cov ered in a d eta iled s tu d y n ea rly 45 p ercen t as m a n y w orkers as th e m a il-q u estion n a ire stu d y .
(S ee ch . v .) A lth o u g h m o st of th ese co m p a n ies w ere also in clu d ed in th e m a il-q u estion n a ire a n a ly sis, 29
c o m p a n ies w ere n o t so in clu d ed b ecau se th e y w ere in in d u stries n o t covered b y th e q u a n tita tiv e s tu d y or
b eca u se th e y w ere selected from a list e x c lu siv ely com p osed of co m p a n y u n io n s an d w ere n o t p a rt o f th e
ra n d o m sa m p le m a ilin g list orig in ally u sed for th e m a il stu d y . T h e 96 com p a n ies in clu d ed in b o th field
an d m a il stu d ie s covered 191,782 w orkers, or 83 p ercen t of th e w ork ers covered in th e field s tu d y . T o th is
e x te n t th e p la n ts covered b y th e field stu d y are id en tica l w ith p la n ts covered b y th e q u estion n a ire rep lies.
290
T
able
CHARACTERISTICS OF COMPANY UNIONS
35.— Distribution of establishments included in field study, by industry
group
E sta b lish m e n ts d ealin g w ith —
T o ta l
In d u str y group
C o m p a n y u n io n s C o m p a n y u n io n s
o n ly
an d tra d e-u n io n s
E sta b
E sta b
E sta b
lish W orkers lish W ork ers lis h W ork ers
m e n ts
m e n ts
m e n ts
A ll in d u stries ________ _______________
__ __
A ll m a n u fa ctu rin g in d u str ie s___ ______ ___________
D u r a b le g o o d s . ______ _____________ . .
_
Iron a n d ste e l________________ __ __________
M a ch in e r y ________ ______ _________ ______
T ra n sp o rta tio n e q u ip m e n t__________ ____
N on ferrou s m e ta ls_____________ _________
L u m b er a n d allied p r o d u c ts_____ _______
S to n e, c la y , an d g la ss_______ _____________
N o n d u r a b le g o o d s____ _________________ ______
T e x tile s_____________________
_ _____
L ea th er__________________________ _____ __
F o o d ______ . . . ________________________ . . .
P a p er an d p r in t in g _______ __ ________
C h em ica ls a n d p e tr o le u m ____________ __
R u b b e r go o d s______________________________
M iscella n eo u s m a n u fa ctu r es_____________ ____
S e r v ic e ._ ________ ___________ . .
... ...
P u b lic u tilitie s _______________ _______________ ' _
M in in g _________ ____________ ________ ______ __
R e ta il tr a d e .. _ _ _____ _ ________ ______
W h olesa le tra d e___ _________ _ _______ ____
125
98
45
13
13
8
4
3
5
43
6
5
10
5
13
4
10
2
11
7
5
2
231,042
179,143
106,259
28, 272
35,110
23,320
6,257
2,013
11,287
66,089
3,938
4,170
9,638
4,432
19, 379
24, 532
6,795
850
32,830
4,184
12, 522
1, 513
86
67
31
13
7
4
2
2
3
28
5
4
6
2
9
2
8
2
3
4
2
8
123,945
95,648
56,132
28,272
11,180
11,990
2,900
1, 313
477
34, 326
3,188
3, 950
3,626
1, 875
17,205
4,482
5,190
850
15,430
484
10,020
1, 513
39
31
14
5
4
2
1
2
15
1
1
4
3
4
2
2
3
1
4
107,097
83,495
50,127
23,930
11,330
3,357
700
10,810
31,763
750
220
6,012
2,557
2,174
20,050
1,605
17,400
3,700
2,502
The establishments studied represented a wide range in terms of
the number of employees. Five of the company unions were in
establishments with less than 100 workers, while 13 were in units
with 5,000 employees and more. Two-thirds of the plants studied
fell in the group with from 200 to 2,500 workers, being fairly evenly
distributed over this range. Because somewhat different units9
were used in the field study and the mail study, it is not possible to
make any direct comparison of the size distributions. The field
study, however, apparently contains relatively more of the larger
plants than does the mail questionnaire.
A list showing the size of establishments covered in the field study
and the number of establishments in each size group is given below:
N u m b er
Under 50 employees_________________________________________
50-99 employees_____________________________________________
100-199 employees__________________________________________
200-499 employees__________________________________________
500-999 employees__________________________________________
1,000-2,499 employees_______________________________________
2,500-4,999 employees_______________________________________
5,000 employees and over------------------------------------------------------
2
3
10
29
27
27
14
13
Total_________________________________________________ 125
T he establishm ent w as the u n it used in th e m ail stud y. T he field stu d y w as based upon organizational
units. W hile the tw o coincided to a very considerable extent, there were certain significant differences,
particularly in public u tility and distribu tive com panies.
9
SCOPE AND METHOD OF THE FIELD STUDY
291
Of the 125 companies studied, 86, employing a total of 123,945
workers, dealt only with a company union. In the other 39 com
panies, with a total of 107,097 workers, the management recognized
and dealt with both a company union and a trade-union. (See
table 35.) Thus, nearly one-third of the companies, covering nearly
half of the workers, presented situations in which the employer
recognized two or more employee organizations. This is a higher
proportion than was revealed by the mail questionnaire,10 in which
the proportion of dual-bargaining situations to all company-union
situations was about 16 percent and the proportion of workers
involved about 27 percent.
The companies studied were distributed over 23 States. (See
table 36.) Twenty-two were in New York, 14 in Ohio, 10 in Illinois,
9 in Massachusetts, and 8 each in Pennsylvania and New Jersey.
In large part, the survey was confined to the territory east of the
Mississippi and to the Pacific Coast area. However, the States
principally represented by the cases studied were those which, as
revealed by the replies to the mail questionnaire, contained the
largest number of company unions.
T able
36.— Distribution of plants covered in field study, by States
S tate
A la b a m a _______ ______ __ ___
A rizo n a ______________ ___________
C aliforn ia________________________
C o n n e c t ic u t ..__ ____ ________
G eorgia___ _______ _______ _____
Illin o is____________ ________ ______
I n d ia n a . ....................................... __
K e n tu c k y . __ __________________
M a ssa c h u setts
_______ ___
M ic h ig a n ___________ ________ . _
M iriTlPQnfil
IVlUIJivov
td-----------------------------------M isso u r i. _
_ ____________
N e w J e rsey _________
C om
p a n ies
S hop
w orkers
3
2
5
4
2
10
4
2
9
6
3
1
8
4,955
1,350
3,502
8,867
980
8,001
7,383
1,010
28,069
14,030
2, 336
750
17,999
S tate
N e w Y o r k ________________________
N o r th C arolin a_________ __ _
O h io ___________________ .
.
O r e g o n ___________ _ _ . _
P e n n sy lv a n ia __________ ______
S o u th C a rolin a__________ _____ __
T e n n e sse e . _______________ _____ _
V i r g i n i a .__________ _______ __ _
W a sh in g to n . __ _________ _____
W isco n sin ________ ______ ________
T o ta l________________ ______
C om
p a n ies
22
1
14
3
8
1
5
4
2
6
125
S hop
w orkers
42,232
2,500
40,454
691
25, 377
500
4,692
7,184
380
7,800
231,042
Seventy-nine different communities, ranging in size from New
York City to towns of 200 people, are represented in the study.
Eleven of the companies were in New York City, six in Chicago, four
in Cleveland, and four in Cincinnati. Five were in communities
with less than 1,000 inhabitants.
Flowing to some extent from this diversity in size was a consider
able variation in the relationship of the establishment to community
life. Many of the companies were located in large cities with varied
industries, and in such cases the workers were more or less free of the
dominance of the company after leaving the plant and had various
means of contact with workers in other plants. Others were located
on the outskirts of such large centers. The freedom and contact of
See p. 60.
292
CHARACTERISTICS OF COMPANY UNIONS
the workers in such cases were more restricted. A number of com
munities were dominated by the industry represented by the company
studied, and some of the smaller communities by the particular
establishment itself. Six or seven of the communities were of the
mine or mill-village type, company owned or company dominated.
In 73 cases, or 68 percent, the workers were reported to be mostly
American-born. In 16 companies these were of early American
white stock only, while in 5 others natives of this stock worked in
plants where more than 30 percent of the employees were Negroes.1
In 15 cases the majority of the workers were American-born of recent
immigrants or of immigrants who had retained a certain ethnic dis
tinctness in the community. The workers were predominantly
foreign-born in 34 companies, and in 20 of these the workers repre
sented a variety of races.
Some of the companies employed mostly skilled workers, others
reported largely semiskilled workers, while a large group hired mostly
unskilled workers. One company had a small staff of skilled workers
for whom steady work was provided and a large number of unskilled
workers whose employment was highly seasonal. In some companies,
all the workers performed the same kind of work, while others required
an elaborate hierarchy of skills and trainings. In 17 companies
most of the employees were reported as having received a highschool education, while in 2 cases people with college training formed
an appreciable part of the employees. At the other end of the scale
were nine establishments with employees reported as being mostly
illiterate. In some companies with large foreign groups, sections of
the workers could speak and understand only their native language.
Eighteen companies stressed the fact that their employees had been
with them a great many years. In one case the average service was
reported as 30 years. Other companies reported highly seasonal
employment with large turn-over.
In terms of type of community and of workers, the group studied
presents a diversity which reflects the varied situations existing in
different sections and industries.
u In 7 cases n o in form ation regarding th e ty p e o f w orkers w a s o b ta in ed , w h ile in 11 oth er cases th is in for
m a tio n d id n o t cov er th e racial c o m p o sitio n o f th e w ork in g force.
SCOPE AND METHOD OF THE FIELD STUDY
293
Schedule Used By Field Agents
IN DU STRIAL RELATIONS M A CH IN ER Y
U
n it e d
B
States D
ureau
of
W
epartm ent
of
Labor
L a b o r S t a t is t ic s
a s h in g t o n
Interview w ith ________________________________
P osition _____________________
D a t e _____________________
Does company wish this to be confidential? ____________
Does person wish a copy of study when completed? ____________
Investigator________________________________
Schedule n um ber______
A. Introductory:
1. Name of fir m ________________________________
2. Address of fir m _________________________________
3. Business affiliation________________________________
4. Plant designation________________________________
5. A ddress________________________________
6. Principal products and services in order of their im portance_______
7. Code or codes under which operating_____________________________
8. Number of employees (not including supervisory staff):
M e n _______ W om en ______ T o t a l______
O ffice______ S h o p ________
T o t a l______
9. Describe in a general way kind of employees constituting majority of
labor force (nationality, race, literacy, e t c . ) _____________________
10. Types of industrial relations machinery (check V) :
(a) Employees representation plan only. ______
(b) Employees representation plan and personnel manage
ment. ______
(c) Employees representation plan and outside u nion .______
B. Employees’ representation plan or association:
1. N a m e _________________________________
2. When established? _____________________
3. Did present plan succeed a different type of plan? _______________
(G iv e d a te a n d sta te m e n t o f ch aracter of ch an g es, an d rea so n s for ch an g es.)
4. Situation at time of establishment:
(a) Labor unrest and threatened strike. ____________
(b) Strike.
____________
(c) Outside union attempting to gain foothold. ____________
(d) Management felt need of closer touch with workers. _____
(ie) Workers requested management for representation plan.
5.
R em arks:_______________________________________________________
Method of establishment:
(a) Executive order with bulletin board announcement. _____
(b) Mass m eeting.____________
(c) Signing of paper passed around shop by an employee.
__
(d) Signing of paper passed around shop by foremen or other
company officials. -------------------
294
B.
CHARACTERISTICS OF COMPANY UNIONS
Employees’ representation plan or association— Continued.
5. Method of establishment— Continued.
(e) Secret vote. ___________
Where conducted? _________________________________
How supervised? _________________________________
Remarks: ______________________________________________________
6. Is there a written constitution? ____________ (Secure copy.)
7. Is there a written agreement signed by both company and representa
tives of plan or association? ____________ (Procure copy.)
(a) When first signed? _________________________________
(b) Date of expiration. _________________________________
(c) Provision for renewal. _________________________________
8. Membership in plan or association:
(a) Requirements for membership:
(1) Length of service with company. _______________
(2) Education. _________________________________
(3) Citizenship. _____________________
(4) Age. --------------------------------(5) Other. _____________________
(b) Does employee retain membership when laid off tempor
arily? _____________
(c) Are all eligible employees automatically considered to be
members? ____________
(d) If not, what proportion of eligible employees are not mem
bers? _____________________
Why are they not members? ____________________________
(e) Do new employees sign up for membership when accepting
employment? ____________ (Get sample cards.)
(/) Membership dues? Yes______ N o______ How much?
(per week)____________ (per m onth)_____________
How are dues collected? _____________________
Who is custodian of funds? _____________________
9. Financing:
(a) Are officers and representatives paid for time attending to
association duties? ____________
(1) Equivalent of wage rate. ____________
(2) More than wage rate. ____________
(3) Less than wage rate. ____________
(4) Monthly or weekly fee. _________________________
How much? ____________
(5) For time put in outside of working hours. ________
(b)
(c)
How are representatives paid?:
(1) By company. ____________
Amount?
(2) By association. __________
Amount?
(3) Does company contribute to plan’s treasury?
____________
How much? _____________
How are other organization costs (e. g. printing, secretarial
expenses, etc.) defrayed? _____________________
SCOPE AND METHOD OF THE FIELD STUDY
295
B. Employees7 representation plan or association— Continued.
10. Election of officers and representatives:
(a) Date of last election_________________________________
Where held?_____________________
Who had ch a rg e?_____________________
(b) Term of office_____________________
(c) Provision for recall_________________________________
(id) Must representatives be employees of company? Yes___
N o______
(1) Have any representatives not been employees of
company? ____________
When, etc.? ______
(e)
May person continue to serve as representative after leav
ing employ of company or transfer to different department?
Yes______ N o______
(1) Any instances? ___________
(/) Method of voting:
(1) Define election districts (department or occupation,
etc.)-----------------------------------------------------------------(2) How are nominations made? ___________________
(3) Who certifies nominees? ________________
(4) Elections:
Acclamation. ____________
Signed ballot. ____________
Secret ballot. ____________
Who supervised counting of ballots?
11.
Remarks: ____________________________________________________
General membership meetings:
(a) How frequently are general membership meetings held?
(6)
(c)
(d)
(e)
(/)
(g)
Date of last meeting____________________
Where held? _____________________
Time of day. __________________________
Employees paid wages while attending?
Provision for referendum ________________
Do representatives of management attend:
On invitation. ____________
As a matter of course. ____________
(h) Topics discussed at membership meeting.
12.
Remarks: _______________________________________
If no membership meetings are provided for:
(a) How does representative account to workers?
(&)
How do workers discuss grievances with their representa
tives, and instruct them as to their desires? __________
(c)
How do workers discuss general policies affecting their
interests? _________________________________
296
CHARACTERISTICS OF COMPANY UNIONS
B. Employees’ representation plan or association— Continued.
13. Do employee representatives have any contacts or meetings with
employee representatives of:
(a) Other plants of same company? ___________
Which?
(b)
14.
Other companies?
____________
Which?
(c) Describe nature of contact. _____________________________
(d) Opinion of person interviewed on desirability of some sort of
national or regional federation of employee representation
plans for the industry. _________________________________
Officers and representatives:
O ffice (p resid en t)
O ccu p ation
N am e
D e p a r tm e n t
H o w lo n g h e ld
office
1
C.
Methods of negotiation:
1. Joint committee or council plan (omit if employee committee type):
(o) How are employer representatives chosen? ______________
Give official position of each. ________________________
(&) Total membership on joint council_____________________
Employer representatives____________
Employee representatives____________
Others. ____________
How selected? ______________
(c) Meetings of council:
(1) When? __________________________________________
(Tim© of day)
(F requ en cy)
(2) Where? _____________________
(3) Is presiding officer the employer representative,
employee, or impartial? _______________________
How selected? _____________________
(4) Is secretary the employer, employee, or impartial
representative? ________________________________
How selected? _____________________
(5) When is secret vote used? _______________________
(id) How is decision made, by majority vote? ____________
By
unanimous vote? ______ Or is voting by unit? ______
(e) Is there any appeal from decision of joint council? ________
(1) To whom? _____________________
(2) How negotiated?
In conference with higher official. ____________
Written appeal. ____________
Remarks: ____________________________________
(f) Provision for outside arbitration? Y e s _______ N o _______
How selected? _________________
How conducted? ______________
Who pays expenses? ___________
What cases have been arbitrated?
(Give dates.)
SCOPE AND METHOD OF THE FIELD STUDY
C.
297
Methods of negotiation.— Continued.
1. Joint committee or council plan— Continued.
(ig) Final decision rests with whom? President, general manager,
board of directors, others (specify). ____________________
(h) How are minutes and other records made available to the
workers?________________________________
Do they consult them? ____________
2. Employee committee type (omit if joint council plan):
(a) Meetings of representatives:
(1) When? __________________________________________
(T im e of day)
(F requency)
(2) Where? _____________________
(3) When is secret vote used? _______________________
(b) Negotiations with employer. (Describe in detail various
steps to final settlement of both ordinary and especially
important matters):
(1) Through joint committee. ____________
(2) Through personnel manager. ____________
(3) Directly to general manager or superintendent.
(4)
D.
Who represents employees in these negotiations?
(5) Written or oral? _____________________
Remarks: ____________________________________________________
(c) Provision for outside arbitration? Yes_______ N o_______
How selected? ________________________________
How conducted? ________________________________
Who pays expenses? _____________________
What cases have been arbitrated? ______ (Give dates.)
(d) Final decision rests with whom? President, general manager,
board of directors, others (specify). ____________________
(c) How are minutes and other records made available to the
workers? ________________________________
Do they consult them? ____________
General working conditions:
1. Check matters which have been negotiated by the management with
representatives of employees’ association since January 1, 1933:
□ (a) Individual grievances.
□ (6) Methods of sharing or rotating work.
□ (c) Rules of seniority.
□ (d) Health and safety.
□ (e) General rules and regulations.
□ (J) Discharge of employees.
□ (g) Changes in weekly or daily hours.
□ (h) Type of wage payment (piece work, bonus, etc.).
□ (i) Wage rates on specific occupations.
□ (j) General wage increases or decreases.
2. Describe last case under each subject checked above which has been
negotiated (except (a) individual grievances and (j) general wages
which are treated separately below). ___________________________
1 5 4 8 7 5 °— 38--------2 0
298
E.
CHARACTERISTICS OF COMPANY UNIONS
Individual grievances:
1. How many cases of individual grievances during a week does the aver
age employee representative take up directly with foreman con
cerned? _____________________
2. When are individual grievance cases referred to the committee?
3.
How many cases of individual grievances have been brought up to
joint or employee committee during past 6 months? ____________
4. How effective is employee representative plan in adjusting individual
grievances? (See instructions.) _____________________
5. Describe six recent cases; kinds of grievances, how handled, and what
settlement was made? __________________________________________
F. Wages:
1. Standards for determining wages:
(а) Does plan set standards for determining wages? __________
Wages paid by competitors, prevailing wage in community?
____________
Cost of living? ____________
(б) If plan has no provision, is any standard used in determining
wages when being negotiated? _____________________
2. Describe in detail last general wage increase or decrease, giving date,
methods of negotiation, and final decision. ______________________
G. General information:
1. Were employees consulted in connection with formulation of code?
(a) Did employees participate at hearings? ____________
2. Did employees participate at hearings of the Wagner industrial dis
putes bill?
(a) 1934 hearings____________
(b) 1935 hearings____________
3. Have employees appeared before any of the Government Labor Rela
tions Boards?
When? _____________________
Issues involved? ____________
Position of employees? _____________________
4. Does the plan allow employees to hire outside experts? _____________
(a) If so, have they ever availed themselves of privilege? ______
____________
(Give details.) __________________________
(b) From what sources would or did funds come to pay the ex
perts? _________________________________
5. Have there been any strikes since the plan has been in operation?
6.
(a) Who called the strike? _____________________
(b) Occupations and departments of workers involved? _______
(c) Number of workers involved: Plan members. _____________
Nonmembers. ____________
(d) Percentage of strikers to total number of employees in occu
pations in v o lv e d ____________
Any recent attempts to unionize the workers covered by the plan?
(а) By what union? _________________________________ Inter
national? ____________
(б) Outcome. ------------------------------------------------------------------------
SCOPE AND METHOD OF THE FIELD STUDY
H.
299
Activities sponsored, administered, and financed by employees, association.
1. Check activities listed below which are administered and financed by
the employees’ association or plan. Double check if administered
or financed jointly with employer.
□ (a) Sick benefits.
□ (6) Savings and loan plan.
□ (c) Restaurant and cafeteria.
□ (d) Cooperative purchasing.
□ (e) Safety and accident prevention.
□ (/) Suggestion system.
□ (g) Library or reading rooms.
□ (h) Recreational activities.
□ (i) Group insurance.
□ 0) Stock purchases.
□ (k) Profit sharing.
□ (l) Outside activities such as politics, charity (specify).
□ (m) Others (specify).
2. Describe each one in detail covering following points:
(a) General description of plan. (Get printed rules, if possible.)
(&) By whom and how was it started? _______________________
(c) Do employee representatives administer plan? ____________
(d) Do employee representatives and employer administer
jointly? ____________
(e) D o employee representatives hear and investigate complaints?
I.
(/) Who acts as treasurer? __________________________________
(ig) Who invests funds? ________________________________
(h) Who pays for administration? __________________________
Outside union or unions (attach separate sheet if more than one union):
1. If company has written agreement with outside union (obtain copy):
(а) Name of local u n ion ________________________________
(б) Name of international u n ion _____________________________
(c) Date of expiration of agreement___________________________
(d) Membership within p la n t____________
(e) Trade jurisdiction_____________________
(/) Name and address of business agent_______________________
(g) How long has company been dealing with u n io n ? ________
Remarks: ____________________________________________________
2. If company has dealings with outside union but no written agreement:
(а) Name of u n io n ________________________________
(б) Estimated membership within p la n t_______________________
(c) Date of last conference with union representative__________
(d) Is it policy of company to meet with union committees of own
employees only? _____________________
(e) Are union representatives not employees also received in
conference? ____________
(/) Matters discussed and decisions. _________________________
(g) Are decisions a result of negotiations? ____________ , or does
company take union demands under consideration and
make its own decision? ________________________________
CHARACTERISTICS OF COMPANY UNIONS
300
1. Outside union or unions— Continued.
2. If company has dealings with outside union but no written agree
ment— Continued.
(h) How are decisions communicated to u n io n ? ________________
3.
To the workers?
(Obtain copies.)
(z) How long has company been dealing with union in this
manner? _________________________________
If company is not now dealing with outside union, has it ever dealt
with union?
(а) Name of local u n io n _________________________________
(б) Name of international union_______________________________
(c) When did it discontinue dealing with u n io n ? _______________
□
(d) Why
? (Obtain written material.)
INDEX
A
Page
A bandonm ent of com pany unions__________________________ ________ ____________ ________ 78,167,260,264,289
A dair v . U nited States____________________________________________________ _______ _______ 212-216,219,222,255
A greem ents. ( S e e C ollective agreem ents, individ ual agreem ents, unilateral statem en ts of p olicy.)
Aircraft Production B oard_____________ _____________________________________________________ __________
15
A labam a U nem p loym ent C om pensation L aw _____________ ________________ __________ ________________ 252
A m algam ated A ssociation of Iron, Steel and T in W orkers____________________________________ ________ 245
A m algam ated C lothing W orkers of A m erica___________________________________ _______________________ 26
A m endm ent of plan:
A s opportunity for change___________
95
A s a result of N . I. R . A ___________________________________________________________________ ______ 274,275
M eth od of:
B y em ployees alone---------------------------------------------------------------------------------------------------------- 106,273,277
M anagem ent approval necessary________________________________________ 13,106,130,200,233,243,271
N um ber of com pany unions providing for_________________________________________________________ 106
A m erican F ederation of Labor:
C ollective agreem ents----------------------------------------------------------------------------------------------------------------------72
C om pany union cooperation w ith ----------------------------------------188
C onflict w ith com pany un ion s________________________________ 84,89,91,186,192,194,259,260,261,265,267
C ontrol of com pany u n ion __________________________________________________________________________ 139
M em bership________________________________________________________________________________________
28
P osition in respect to com pany u n ion s__________________________________________________________18,25, 26
A m erican G uild of th e P rinting In d u stry __________________________________________________________ 64,73,185
A m erican M anagem ent A ssociation, T h e _________ _______________________________________________ _____
22
A m erican B ollin g M ill C o____________________________________________________________________________7, 23, 24
A m erican Steel Foundries v . T ri-C ity C entral Trades C ou n cil______________________________________214, 222
A m oskeag M anufacturing C o___________________________________________________________________________
24
A nilene & C hem ical Co., M atter of____________________________________________________________________ 229
A nsin Shoe M anufacturing C o., M atter of____ ______________________________________________________ 247,248
A ntiu nion contracts________________________________________________ ________ _________________ 209,213-215,224
A nw elt Shoe M anufacturing C o., M atter of------------------------------------------------------------------------------------------ 248
A rbitration________________________________________________ 3,4,10,12,72,104,137,150,154,160,161,197,204,279
A s protection against discrim ination_________________________________________________________ 127,128,166
B y consent of both p arties_____________________________________________________________________ 13,68,157
B y em ployees alone_____________________________________________________________________ 156,157, 271,277
F requency w ith w hich u sed ______________________________________________________________ 68,159,203,206
M eth od s_____ ______________
68,151,156-158
N um ber of com pany unions providing for_________________________________________________ 68,74,154,158
A rt M etal C onstruction C o., M atter of________________________________________________________________ 228
A ssociated Press, T h e, v . N ational Labor R elations B oard____________________________________________ 254
A ssociation of Clerical E m p loyees____________________________________________________________________ 221,222
A thletics and sports_______________________________________________________________________ 21,79,104,193,263
A tlas B ag & B urlap C o., In c., M atter of-------------------------------------------------------------------------------------------- 241,248
A tlanta W oolen M ills, M atter of_____________________________________________________________________ 241,249
A ttorn ey for com pany:
A ddressed em p loyees___________________
87,91
D rew u p com pany union constitution_____ ________________________________________________________ 264
Participated in functioning of com pany u n ion ----------------------------------------------------------------------------- 120,244
Supplied constitution_______________________________________________________________________________ 100
A utom atic participation. ( S e e Participation in com pany union.)
A utom obile Labor B o a rd .------------------------------------------------------------------------------------------------------------------- 36,226
B
Baltimore & Ohio Railroad______________________________________________________________
Bankruptcy Act of 1934______ ______ ____________________________________________________
Bedaux wage system____ ________________ __________ ____________ _______ _______________
301
26
215
171
302
INDEX
Page
Benefit and welfare activities {seealsoMutual benefit associations)_______ ___________________21,22,112
As incentive to company union membership___________________________________ 113,194,204, 248
As principal interest of full-time officials______________________________________________ 126,165
As purpose of company union...-------------------------------------------------------------------------- 101,104,263
How financed-------------------------------------------------------------------------------------------------- 114,117,270
In 1930-32__________________________________________________________________________ 27
Scope and extent of_________________________________________________________ 4,63,64,181-183
Bethlehem plan------------------------------------------------------------------------------------------------------------ 13
Bethlehem Steel Co.------------------------------------------------------------------------------------------------------ 14,16
Bituminous Coal Conservation Act of 1934_______________________________________________ 251,252
Black-Connery bill___________________________________________________________________ 189,190
Blacklist, legal aspects--------------------215
Board of directors, employee representatives on-------------------------------------------------------------------- 23
Boycott.............................. w---------------- --------------------------------------------------------------------------- 211
Bribery of union officials---------------------------------------------------------------------229
Bridgeport, Conn., plan_________________________________________________________________ 12,218
British Government’s Reconstruction Committee________
17
Brotherhood of Locomotive Engineers------------------------------------------------------------------------------- 217
Brotherhood of Railway Clerks------------ ----------- ----------------------------- ------------------------------- 221,222
Brotherhood of Sleeping Car Porters--------------------- ----------- ----------------------------- ----------------- 20
C anadian N ational R ailw ays....................................... .........................................................................................................
26
C anvas G love M anufacturing W orks, In c., M atter of-------------------------------------------------------------------------- 248
Carter v . Carter C oal C o. et. al--------------------------------------------------------------------------- ----------------------251,254,255
C entral Labor U n io n ------------------------------------------------------------------------------------------------------------------------------ 260
C ertification of collective bargaining a g e n t . --------------------------------------------- 224,232,249,250,253,254,273,275
C ham bers of C om m erce----------------------------------------------------------------------------------------------------- 68,100,157,248,261
C hanges in com pany unions, general { s e e a l s o R evision s in in divid ual com pany u n ion s)______________ v n ,
109,116,132,134,157,158, 203, 204
Check-off. { S e e a l s o C losed sh op ):
For repaym ent to loan fu n d ___________________________________________________ ____________________ 182
G ranted com p an y u n ion ---------------------------------------— ------- ---------------------------------------------- 117,196,198,268
N u m b er of com pany unions p roviding_____________________________________ ________ _______ _______ 116
C hesapeake & O hio----------------------------------------------------- ------- ------------- ---------------------------------------------------26
C hicago, M ilw au k ee, S t. P au l & P acific------------------------------------ ----------------------------------------------------------- 26
C hrysler Corporation and S ociety of D esigning Engineers, M atter of-------------------------------------------------- 251
C lin ton C otton M ills, M atter o f______________________________________ _______ ______________ 241,243,244,247
C losed shop. { S e e a l s o C heck-off):
G ranted com pany u n ion .................................... ........................ ................................................................................... 109,113
D en ied b y m anagem ent____________________________________________________
110
G ranted trade u n ion -----------------------154,236
O pposed b y m anagem ent--------------------------------------------- --------------------------------------------------------- 188,259
L egal aspect of closed shop for com pany u n ion s------------------------------------------------------- 230,243-244,247,249
Coercion b y em ployers---------------------------------------------------------------------------------------------------- 88,89,98,140,199,268
L egal aspects________________ _______ ______________ 221,223,224,225, 231,236,237,239,242,245,251,253, 255
C ollective agreem ents:
D efin ition ________
154,229
L egal requirem ents concerning_____________________________ 218,220,221,223,224,226-230,236,246,252-254
W ith com pany unions:
C ircum stances leading to __________________________ 100,155,236,247,261,263,267,268,269,270,275,276
C ontents of_____________________________________ 72,109,110,127,144,154-158,160,173,203, 230,236, 237
G ranted to com pany u n ion before trade u n ion ---------------------------- -------------------------------------------- 196
G ranted to com pany u nion and n ot to trade u n ion -------------------------------------------------------- 92,99,156
N u m b er_____________ ______________________________________________________________ 72,74,203,204,288
Securing approval of em ployees------------------------------------------------------------------------------------------------- 144
W ith trade u n ion ______________ ________ ____________________________________ 156,193,196,218,259,267,268
C ollective bargaining:
C om pan y union as agency for----------------------------------------------------------------------------------- 115,162-180,201-206
A s alternative to trade-union bargaining______________2,4,9,20,80,90,94-95,196,261-263,275,276
P rovided in collective agreem ent----------------------------------------------------------------------------------------------- 110
P rovided in con stitu tion __________________________________________________________________ 83,101,102
D efin ition _______________________________________________________
228,229
L egal aspects____________________________________________________v n , 209,211,213,225,228,229,251,255,256
M u tu al benefit association as agency f o r , ....................... - ...............................................................................64,79
INDEX
303
C ollective bargaining—C ontinued.
P age
T hrough trade-unions........ ...................................................... ................................. ............. ....................... 186,188,193,194
A m erican Federation of Labor a ttitu d e ........................................ .....................................................................
26
U nder B ridgeport p la n .............................................................................................................. ........................................
12
U nder W h itley C ouncils-----------------------------------------------------------------------------------------------------------------17
Colorado F uel & Iron C o_________________________________________ _______ _________________________ 7,9,10,16
C om bination com m ittees____________________________________________________________________ 122,130-137,274
C om m ittees, d ivision al_______________ ______________________________________________ 134,135,138,150,151,152
C om m ittee forms:
C om bination____________________________ ______________ __________________________________ 122,130-137,274
E m p loyee__________ 7,12,13,22,91, 111, 130-135,150-152,156,203,217,218,232,263,271,272,273,274,276,279
Join t.................................... ...................................................................................... 7,10,13,16,22,24,104,110, 111, 122,128,
130-137,150-153,157,168,169,175,181,189,203,206,242,258,259,260,270,271,272,275,276
C om m onw ealth v . H u n t________________________________________________________________________________ 211
C om m onw ealth v . P u llis_______________________________________________________________________________ 210
C om pan y hou ses_______ _______________
21
C om pan y stores_______________
21
C om pensation for representatives and officers:
L egal aspects________________________ _____________ _________________________________ 231,233-235,245,246
N um b er of com pany u nions com pensating representatives________________________________________
65
P a te ____ _______ _______ __________________ ____________________________________________ 6 6 ,124r-126,127,245
Source____________________ ___________________________________________________ 66,114-115,117,124r-126,277
C om pliance D iv ision of N . R . A _______________________________________________________________________ 226
C oncerted a ctiv ity of workers prohibited----------------------------------------------------------------------------------------------- 210
C on ciliation _______________
10,12
C onnecticut C oke C om pany, M atter of_______________________________________________________________ 228
Conspiracies, trade unions considered---------------------------------------------------------------------------------------------------210,211
C on stitu tion s and by-law s:
A s a joint agreem ent_______________________________________________________________________________99,154
C o n te n ts ....__________ ______________ _______________________ ______ 73,100-107,108,110,111-115,120-121,
125-128,131,135-138,140,144,148,150,156-159,167,183,200,201,263,270-276
99
D efin itio n ______________________________ ____________________________________________________ ^______
H ow drafted and adopted_____________________ ______ 96,100,117,179, 230-232,242-244,258-267,270-276
N um b er of com pany unions h avin g__________________________________________________________
99,154
P rin ted b y insurance com p an y_____________________________________________________________________ 181
R evision s_______ _____________________ _____________ __________________________________________ 80,263-270
Sim ilarities________________________________ ___________________________________________________ 100,154,260
C ontacts betw een em ployees and em ployee representatives___________ 120,125,138,140-146,161,203,235,242
C ontracts, antiu n ion __________________________ ____________ ________________________ _________ 209,213-215,224
C ooperation b etw een em ployees and m anagem ent:
A s purpose of com p an y u n io n s.._______ _______________________________________________ ______ 101,102,105
A s trade-union p o lic y .______________________________________________________________________________
26
D urin g W orld W ar period_________________________________________________________________________
17
D urin g post-w ar period_________
19
D uring 1923-29 period_____ _________________________________________________________________________
22
C ooperative association_________
3
Coppage v . K ansas_______________________________________________________________________ 213,215,219,222,255
Corn Products R efining C o______________________________________________________________
218
Craft versus industrial u n ion ism ___________________________________________________________ 55,91,193,194,259
C redit facilities___________ ______________________________________________________________________21,63,181,182
C udahy B ros., M atter of______________
232
D
Danbury & Bethel Fur Co., Matter of________________
Davidson Employees* Association----------- -----------------Davidson Storage & Transfer Co., Matter of----------------Definition of company union_________________________
Dennison Manufacturing Co., The___________________
Denver Tramway Corporation, Matter of—..................... .
Discharges. (For legal aspect, see Right to hire and fire):
Employee irritation over— ______________________
Employees do not retain membership after-------------Employees retain membership after____ __________
Negotiation of....................................................................
Of officers and representatives_____ _____ _________
Of trade-union members.............................................
Reasons for summary discharge..................................... .
__________
231,237
________________
237
________________
237
_______
3
______________
7
__ ______
227
_____________ ___21,161
_____ __________110,166
_________
113,166
..... 69-71,103,154,155,163,166-168,279
___
127-129,175
86,88,89,95,166,194,199,236,260,262,267
.................................. 278,279
304
INDEX
P age
D isc rim in a tio n b y m a n a g em en t_________________________ ______ ______ 10 ,20,21 ,85,1 26,1 29,16 4,18 8,19 4,20 1,25 9
L ega l a sp ects of_____________________ _____ ________ 212, 213,216, 219,225,229-231,234-244,247,248,251,253, 255
D ism issa ls. ( S e e D isch arges.)
D isp la ce m e n t, c o m p a n y u n io n b y tr a d e -u n io n .__________________________________________________ 80,173,195,289
D isp la ce m e n t, trad e-u n ion b y c o m p a n y u n io n ______________________________________ 80,91,176,194,220,268,289
D isp u te a d ju stm e n t. ( S e e G rieva n ce a d ju stm en t.)
15
D isq u e , C ol. B rice F _____ ________________________ ____________ _____ _________________________________________
D istrib u tio n o f p la n ts w ith co m p a n y u n io n s, b y size of c o m m u n ity _____________________________________ 291
D iv isio n a l co m m ittees an d su b co m m ittees______ ______________________________________ 134,135,138,150,151,152
“ D u e process” c la u se _____________________________________________________________________ 212,213,223,253,254,255
D u e s in c o m p a n y u n io n s_______________________ ______________________________________ 3,6 1 ,6 4 ,7 4 ,9 2 ,1 1 0 , 111, 113,
114-119,125,130,131,144,180,195, 200,203,204, 246, 248, 266, 267, 271,272, 273,274, 275, 276, 277
D w ig h t M a n u fa ctu rin g C o., M a tter of_____________________________________________________________________ 249
£
E agle R ubber C o., M atter of_______________________________________________________________ ___________ 228
E dition B ookbinders of N ew Y ork_____________________________________________________________________ 185
E ducational activities______ ______________________________________________________________ 21,101,103,104,144
E fficien cy-___________________ ________________________________________________________ 17,21.79,82,101,104,258
E lection d istricts................................................................................... .............................................................................. 120-122,274
E lection of bargaining agent. ( S e e V ote on acceptance.)
E lections, G overnm ent supervised___________________________________________ 12,94,189,267,268,272,274,275
L egal aspects______________________________ 220,223, 226,227,228,230,231, 232, 234,235, 237, 249,250, 252, 254
E lection of officers and representatives______________ 95,96,122-124,242,258-261,263-265,267,268,271,273,274
A s indication of support of con stitu tion ____________________________________________________________ 140
Instead of v ote of acceptance________________ ________________________________________ 86,87,93,97,233,234
M anagem ent influence o n ------------------------------------------------------------------------------------------ 122,123,224,231,261
P articipation b y trade-union m em bers----------------------------------------------------------------------------------- 193,194,217
U nder N ational W ar Labor B oard_________________________________________________________________ 12,13
U se of p lan t for_________________________________________________ ____________________________________ 117
E lections of acceptance of com pany u nion. ( S e e V ote on acceptance.)
E ly & W alker D ry G oods C o___________________________________________________________________________ 238
E m ergency R ailroad T ransportation A ct of 1933_____________________________________________________215,223
E m p loyee c o m m ittee s.. 7,12,13, 22,91, 111, 130-135,150-152,156, 203, 217, 218, 232, 263, 271, 272, 273,274, 276, 279
E m p loyee h ostility to trade-unions___________________________ _________________________________ 90,91,94,268
E m p loyee representatives on com pany board of directors_____________________________________________
23
E m ployees* A ssociation of th e P en n sylvan ia G reyhound L ines, In c__________________________________ 241
Em ployers* associations______ __________ _________________________________________ _____________ 15, 22,100,187
E m p loym en t, V olum e of________________________________________________________________________________
26
E rdm an A ct, T h e ___________________
212
E stablishm ent of com pany union:
B y em ployees______ _____________ __________________ 85,86,89-92,118,131,132,199, 236, 248, 260, 267-269, 277
B y G overnm ent agency_______ _______ ___________________________________________________ 10-15,16,19,193
B y m anagem ent_______ _____________________
20,79,
85-90,118,130,131,132,179,199, 220,230,231,232,237,242,243,245, 247, 258-267, 270-279, 289
E xchange B akery & R estaurant Co. v . R ifk in --------------------------------------------------------------------------------------- 214
E xpress com panies___________________
57
Federal Bankruptcy Act_____ _________________________________________________________ 215,222
Federal Coordinator of Transportation____________________________________________________ 20, 223
Federal labor unions__________________________________________________ 91,192,193,194,232,234, 267
Federal Social Security Act______________________________________________________________ 252
Federal Trade Commission Act_____________________________ ____________________________ 239
Federated company unions, (
Loyal Legion of Loggers and Lumbermen)___ 64,73,184,185,188,286
Field study, copy of schedule___________________________________________________________ 293-300
Field study, scope and method_______________________________________________________ 77,286-292
Filene Cooperative Association___________________________________________________________ 7,8
Finances of company unions___________________________________________ 92,114-119,200,201,204, 267
By type of organization______________________________________________ 116,130-132,270, 271, 272
Compensation for officers and representatives____________________________ 66,114-117,124-126,143
For benefit and welfare activities_________________________________________________ 180-183,204
For political activity________________________________________________________________ 187,189
Legal aspects of financing by company___________________________ 116, 221,223, 230-235,238, 242-246
To hire experts_________
179-180
Which engaged in negotiation......................... ........................... .............. ........................................ 175,176
s e e a ls o
INDEX
305
Page
___________________________
232-235
F iresto n e T ire & R u b b er C o., M a tter o f_____
F ree ch oice o f rep resen ta tiv es as a lega l right.
11, 209, 213, 217, 221-226,232, 233,239,247,251,253,255
F ried m a n -H a rry M a rk s C lo th in g C o., I n c ...
_______________ 254
F rie n d sh ip A sso c ia tio n , _______________________
____________ 241,243
F reu h a u f T ra iler C o ___________________________
_______________ 254
F u ll-tim e officia ls_______________________________
________ 204,270,271
A b ility of___________________________________
_______________ 126
D u tie s _______________________________________
. . . 147,164,165,189
R e q u ire m e n t th a t h e m u st b e an e m p lo y ee of th e co m p a n y .
____________ 126,201
S a lary, an d b y w h o m p a id _____________________________________
114,117,125,126,201
G
G en eral C igar C o., M a tter o f_____________________________
G en eral E le c tr ic C o _______________________________________
G eograp h ical d istr ib u tio n of p la n ts in field s tu d y ______
G o m p ers, S a m u el_________________________________________
G ood rich C o ., M a tte r o f B . F ____________________________
G o o d -w ill p la n or c lu b ____________________________________
G o v ern m en t in stitu te d p la n s_____________________________
G ra n ite C u tte rs In te rn a tio n a l A sso cia tio n ______________
G ra p h ic A r ts In d u str ia l F ed era tio n o f G reater B o sto n .
G rief & B r o ., In c ., M a tter o f L __________________________
G rieva n ce an d d isp u te a d ju stm en t:
A p p e a ls________________________________________________
A s p u rp ose o f c o m p a n y u n io n ----------------------------------B e tw e e n in d iv id u a l an d forem an ____________________
E ffe c tiv e n e s s-_________________________________________
E x te n t._______________ _________________________________
F reed o m o f ch oice o f rep resen ta tiv es for____________
In C olorad o F u e l & Iron C o _________________________
M e t h o d s ..._________ __________________________________
N u m b e r o f c o m p a n y u n io n s en ga gin g in ___________
T h ro u g h fu ll-tim e o fficia l____________________________
U n d er N a tio n a l W ar L ab or B o a rd __________________
U n d e r R ailroa d L ab or B o a r d ________________________
U n d er tra d e-u n io n s_______________ ______ _____________
U n d er tra d e-u n ion s an d co m p a n y u n io n s__________
G rieva n ce c o m m itte e s____________________________________
G roup in su ra n ce___________________________________________
G ro w th of c o m p a n y u n io n s______________________________
____________________________
229
_________________________________ 12 ,14,24
____________________________________ 291
____________________________________ 11,14
____________________________________ 235
_______________________________ 3,2 41,249
_________________________ 10-15,16,19,193
____________________________________ 236
____________________________________ 185
____________________________________ 231
__________________________________ 150-153
_____________________ 82,101,102,258, 263
___________________________________ 24,147
________ 21,164,165, 201, 205,217,233, 246
______________________ 69-71,162-165,201
_________________________ 221-223,252,253
____________________________________ 9 ,1 0
10,134-135,147-150, 242, 245, 271, 277, 279
______________________ 4,102,155,165, 201
__________________________________ 126,201
___________________________________ 12,218
_______________________________
219
____________________________________ 2-3
______________________________
196
___________ 122,135,149,150, 261, 266,273
____________________ 16 ,21,63 ,79,1 81,1 82
________________________ 3 ,1 9 ,2 4 ,2 5 ,2 7 ,2 8
H
H a rd w a re D ea lers M u tu a l F ire In su ra n ce C o. v . G lid d en C o____________________________________________ 254
H e a lth an d sa fety :
A s p u rp ose o f c o m p a n y u n io n ___________________________________________________________ 101,102-104,233,263
E ffe c tiv e n e ss____________________________________________________________________________________________ 169,201
N o t reco gn ized a s c o lle c tiv e b arg ain in g su b jects_______________________________________________________ 228
N u m b e r o f c o m p a n y u n io n s in ter e sted in _______________________________________________ 4,6 3,69-71 ,162 ,163
S a fe ty o rg an ization s c o n v erted in to rep resen ta tio n a g en cies__________________________________________
79
U n d er C olo ra d o F u e l & Iron C o. p la n _________________________________________________________________ 9,1 0
H itc h m a n C oal & C ok e C o. v . M itc h e ll_____________________________________________________________________ 214
H o m e -b u y in g p la n s_______ ____________________________________________________________________________________ 21,27
H o o sier M a n u fa ctu rin g C o ., M a tte r of_____________________________________________________________________ 232
H o u d e E n g in eerin g C orp ., M a tte r of________________________________________________________ 196,226-228,229,240
H o u rs o f w ork . ( S e e W a g es, h o u rs, a n d w o rk in g co n d itio n s.)
H u g h es, C h ief J u stic e ________________________
222,254
I
In d ep en d en ce gu aranteed:
T o e m p lo y ee s_________________________________________
T o r ep resen ta tiv es_________________________________
In d iv id u a l a g reem en ts____________________________________
In d u str ia l v ersu s craft u n io n ism ________________________
In d u str ia l d e m o c r a c y _____________________________________
A ty p e o f c o m p a n y u n io n .......................................................
....................................95,166
109,126,127,201,271,278
___________
156
_____ 55, 91,193,194,259
_________________3 ,1 4 ,2 7 0
.......... 7,1 33,134,260,273
306
INDEX
Page
In d u stria l W ork ers o f th e W o rld __________ ______________________ ____________ _______ ______________________
72
In itia tio n fees________ ______ _____________________________________________________________________ _____ _____ 110,116
In ju n c tio n s------------------------------------------------------------------------------------------------------------------------------- 213,214,220,221,222
In terb o rou g h R a p id T r a n sit C o. v . L a v in __________________________________________________________________ 214
In terferen ce b y m a n a g em en t. ( S e e d iscrim in a tio n .)
In te rn a tio n a l H a rv ester C o _________ __________________________________________________________ 16,240,243,246,247
In tern a tio n a l H a rvester C o., M a tter o f__________________________________________________________ 240,243,246,247
I n te rsta te C om m erce C o m m issio n ___________________________________________________________________________
58
In te rsta te com m erce, leg a l con cep t______________________ ___________________________ 212,222,239,251,252,253,255
In tr a c o m p a n y a ssociation s_______________ _____________________________________________________________ 216,217,226
J o b a n a ly sis____________________________________________________________________________________________________
21
Jo h n so n B ron ze C o., M a tte r of______________________________________________________________________________ 238
J o in t B o ard o f A rb itration in th e sh o e in d u s tr y ____________________________________________________________
73
J o in t co m m itte e s, cou n cils, or b o ard s_____________________________________________ 7,1 0,13,1 6, 22,24,104,110, 111,
122,128,130-137,150-153,157,168,169,175,181,189, 203, 206, 242, 258, 259,260, 270, 271,272,275,276
Jo n es & L a u g h lin S teel C o rp ora tio n ______________________________________ ________________________________ 254,255
K
K a y n ee C o., M a tter of T h e __________________________________________________________________________________ 232
K in g , M a ck e n z ie _______________________________________________________
9
K n ig h ts o f L a b or______________________________________________________________________________________________
51
K n o x v ille G ra y E a g le M a rb le C o., M a tter o f______________________________________________________________ 232
K o h ler C o., M a tter of T h e . . . . ________________________________________________________________________ 231,232,234
______________________
240,241
_______________________
11
211
_____________ 27,103,155,163,169
_____________ . . . . 14,121,127,128
__________________ 80,89,259,267
__________________________ 110,113
______________________ 87,166, 278
_________________________ 155,168
______________________ 216,217,230
_________________________ 211-216
_______________________
212
3,15,16,17, 31, 64, 73,185, 286,289
___________________________
229
___________________________
15
_
_______________________ 248,249
_________________________
228
_______________________ 284,285
_____________ _______ 31, 280-285
226,227,238,240,249-251, 254,270
......... 87-95,140,258,259, 265,273
_______________________________
11,20,23
114,115,117,139,143,230,271,277
_______________________________ 138,139,143,231,238
_________
125,233,234-235
_______________________________
243
_______ 64,65,72,73,138,233,262
_______________________________ 145,146
.. _. 130-133,138,258,271,274,275
_
M
M a c k a y R a d io & T eleg ra p h C o., M a tter of______________________________
M a g n o lia C o. ca se--------------------------------------------------------------------------------------M a il in q u ir y , q u estion n a ire____ ___________________________________________
M a il in q u ir y , sco p e an d m e th o d __________________________________________
M a jo rity r u le in d eterm in in g rep resen ta tiv es for c o lle c tiv e b a rgain in g
M a ss m e e tin g o n a cce p ta n c e _______________________________________________
M e a t p a ck in g _________________ ______________________________________________
M e e tin g s, p la ce o f_____________ _____________________________________________
M e e tin g s, t i m e . _______ _____________________________________ _______________
M e e tin g s o f e m p lo y ee rep resen tatives:
C o m p en sa tio n for tim e sp e n t in ---------------------------------------------------------C o n trolled b y m a n a g e m e n t___________________________________________
F r e q u e n c y ------------------- ----------- ------------------------------------------------------------M in u te s o f.______________ _______________________________________________
S ep a ra tely or w ith m a n a g e m e n t-------- -----------------------------------------------M e e tin g s o f em p loy ees:
A s c o n ta ct b etw een em p loy ers an d em p lo y ee rep resen ta tiv es-------F r e q u e n c y --------------------------------------------------------------------------------------------M in u te s___________ _____________________________________________________
N u m b e r o f c o m p a n y u n io n s h a v in g ------------------------ ----------------------T o co m b a t tr a d e -u n io n ................................. .............................................................
____ _____
_
L
L a b or organ ization , d e fin itio n ____________________________
L a b or tu rn -ov er r a tes_____________________________________
L a b or u n io n s recogn ized b y c o u rts______________________
L ay-off:
N e g o tia tio n of_________________________________________
O f c o m m itte e m e n _____________________________________
O f tra d e-u n io n m e m b er s_____________________________
R ig h t to p a rticip a te in c o m p a n y u n io n d u r in g ____
R ig h t v e ste d so le ly in m a n a g e m e n t...............................
S e n io r ity c o n cern in g______ _____ _____________________
L eg a l sta tu s o f c o m p a n y u n io n ..________________________
L eg a l restrictio n s u p o n e m p lo y er s_______________________
L ib e r ty o f co n tr a c t________________________________________
L o y a l L eg io n o f L oggers a n d L u m b e r m e n ______________
L u c e y S h o e C o ., M a tte r o f J o h n E ______________________
L u m b e r m e n ’s P ro te c tiv e A sso cia tio n ___________________
_______________________________ 104,145,161,203,233
______________ 66,67,99,271,276
________________ _________
288
. . . 66,67, 74,110, 111, 200,204,274
............................... 91,96,261,265
INDEX
M eetin gs of em p loyees—-C ontinued.
T o elect officers and com m ittees____________________________________
T o introduce and v ote on com pany un ion _________________________
T o v ote on acceptance in to m em bership________________________
M em bership requirem ents and lim itation s_____________________________
M eth od of dealing b y geographical region______________________________
M eth od of dealing b y in d u stry . _________ __________ _______ __________
M eth od o f dealing b y size of estab lish m en t____________________________
M in u tes of council m eetings:
A s m eans of keeping em ployees inform ed__________________________
C onsidered as w ritten la w _________________________________________
C o n te n ts .._______________ _________________________ ________________
O btained b y field agents___________________________________________
O utside expert hired to help w ith __________________________________
Q uotation s. ___________ _____________________________________________
M orale. _______________________________________________ _______ __________
M u tu al b enefit associations. ( S e e a l s o B enefit and welfare activities):
A ctivities and exten t________________________ ________ ______________
D evelop ed in to com pany u n ion s___________________________________
D urin g 1923-29 period---------------------------------------------------------------------F ull-tim e paid officials______________________________________________
Officers of benefit association active in com pany u n ion ......... ..............
307
Page
_________
124,217
. . . 95,258,260,261,262,265,267
____________________
109
___________ 60,108-113,167,170
_________________________49,50
_______ 34-50,52-54,56-59,289
_______ 32,33,36,46-49,51,281
__________
145,146
____________
156
_____ 145,146,161,162,186,189
______________________ 286,288
_________________________
179
_______________________ 274,275
______ _____
17,21,82
______________ 181-183,204,281
64, 79,104,126,165,261,262, 263
__________________ ______
21
________________________ 126,165
_________________
267
N
N a tio n a l A sso cia tio n of M a n u fa ctu rers___________________ _______________________ _______ _________________23,100
N a tio n a l B itu m in o u s C oa l C o m m issio n ___________________ _____ _____________ _____________________________ 251
N a tio n a l In d u str ia l C on feren ce B o a r d __________________ ___________________________________ 7 ,1 7 ,1 9 ,2 2 ,2 5 ,2 7 ,2 8
N a tio n a l In d u stria l R e co v e r y A ct:
C o lle c tiv e b a rg ain in g u n d er________
172-203
L ega l a sp e c ts_______________________ ______ _______ _______________________________________ 215,225-239,251
E ffe c t u p o n co m p a n y -u n io n form of:
A r b itr a tio n ______________________ _____________ _______________________________________________________ * 68
B e n e fit a sso cia tio n s___________
79,262,263
C o n stitu tio n s__________________
103-106,110
D u e s a n d fin a n c e s_______ ______ _______________________________ ________________________ 63,64,11 5,11 6,20 0
In creased e m p lo y ee c o n tr o l_____________________________________________________________________ 8Q, 81,203
N u m b e r o f a g reem en ts_________________________________________________________________________ 72,154,155
P a r tic ip a tio n b a sis__________ _______________________________________________________________________ 61,203
R estrictio n s o n m e m b er sh ip _____________
113
S h ift to e m p lo y ee c o m m itte e fo rm _____________________________________________ 133,134,200,203,274,275
E ffe c t u p o n e m p lo y e e in itia tiv e ___ ____________________________
90
E ffect u p o n org an ization o f c o m p a n y u n io n s_______________ _____ _____________________________________
4,
50 -5 5,78 ,8 1,83 ,84,92 ,93,9 4,99,1 00,1 12,1 15,19 1, 258, 263,264, 265,268,269, 270
E x p la in ed b y m a n a g e m e n t_______________________________________________
86
G ro w th o f co m p a n y -u n io n m o v e m e n t______________________________________________________________ 3,2 8
G ro w th o f tra d e-u n io n a c t iv it y . ____________________________________________________________ _____ 27,28
S tu d y m a d e before in v a lid a tio n o f . _____ _____________________________________________________________ v n , v m
N a tio n a l L abor B o a r d .___________________ ___________________________________________________ 226,227,229,274,275
N a tio n a l L ab or B o ard oases:
A rt M e ta l C o n stru ctio n C o ., M a tter o f_______________________________________________ _________________ 228
C o n n ecticu t C o k e C o ., M a tter o f______ _____ _______________ ___________ ________________________________ 228
E a g le R u b b er C o ., M a tter o f _______________ ____________________________________________________________ 228
G eneral C igar C o ., M a tter o f ________________________ ___________________________________________________ 229
N a tio n a l L o ck C o ., M a tte r o f___________________________ _____________________________ _____ ____________ 228
N a tio n a l L ab or R e la tio n s A c t . ______ ____________________ _____ ____________________ 185,187,188,190,215,239-251
C o n stitu tio n a lity su sta in e d _______________________ ______ __________________________________ ______ ____ 254,255
P ro ced u re u n d e r ______________ _____________ __________________________________________________________ _ 239,240
N a tio n a l L a b or R e la tio n s B oard:
Appeal to.___ _______________________________ ____- ........................... .................. 151,157,158,275
Attitude of company unions_____________________ ___________________________________187,188
Elections___________ ____________ _______ ____________ ____________________ ________ 267
Hearings___ _____________ _________________________________________________________ 187
Legal aspects.................... .— ............................................................... ............................ 196,226,227,229-251
National Labor Relations Board cases:
Anilene & Chemical Co., Matter of------------------------------------------------- ------- ------------------- 229
Ansin Shoe Manufacturing Co., Matter of------------- ------------ --------------------- ------- ---------- 247,248
Anwelt Shoe Manufacturing Co., Matter of.................................................................. ......... ........... 248
308
INDEX
N a tio n a l L a b or R e la tio n s B o a rd cases— C o n tin u e d .
Page
A tla s B a g & B u r la p C o ., In c ., M a tte r o f_____________________________________________________________ 241,248
A tla n ta W o o len M ills, M a tte r o f_____________________________________________________________________ 241,249
C a n v a s G lo v e M a n u fa ctu rin g W ork s, In c ., M a tter o f ._______________________________________________ 248
C h rysler C orp oration , M a tte r of_________ ______________________________________________________________ 251
C lin to n C o tto n M ills, M a tte r o f _________________________________________________________________ 241,243,244
C u d a h y B roth ers, M a tte r of__________ __________________________________________________________________ 232
D a n b u r y & B e th e l F u r C o ., M a tter o f---------------------------------------------------------------------------------------------- 231,237
D a v id so n Storage & T ransfer C o m p a n y , M a tter o f___________________________________________________ 237
D e n v e r T r a m w a y C orp oration , M a tter o f_____ ________________________________________________________ 227
D w ig h t M a n u fa ctu r in g C o ., M a tte r o f_________________________________________________________________ 249
E ly & W a lk er D r y G o od s C o ., M a tte r o f______________________________________________________________ 238
F iresto n e T ir e & R u b b er C o ., M a tte r o f_____________________________________________________________ 232-235
G o od rich C o ., M a tte r o f B . F ___________________________________________________________________________ 235
G rief & B ro., In c ., M a tter o f L _ ________________________________________________________________________ 231
H o o sier M a n u fa ctu rin g C o ., M a tter o f_________________________________________________________________ 232
H o u d e E n g in eerin g C orp oration , M a tter o f____________________________________________ 196,226-228,229,240
In te rn a tio n a l H a rv ester C o ., M a tte r o f_____________________________________________________ 240,243,246-247
J o h n so n B ron ze C o ., M a tte r o f ______ ___________________________________________________________________ 238
K a y n e e C o m p a n y , M a tter o f T h e ______________________________________________________________________ 232
K n o x v ille G ray E a g le M a rb le C o ., M a tter o f__________________________________________________________ 232
K oh ler C o., M a tter o f T h e ..___________________________________________________________________________ 231,232
L u c e y Sh oe C o ., M a tter o f Jo h n E ______________________________________________________________________ 229
M a ck a y R a d io & T elegrap h C o ., M a tter o f_________________________________________________________ 248-249
N e w E n g la n d T ran sp orta tio n C o ., M a tter o f__________________________________________________________ 249
N o r th C arolin a G ra n ite C orporation, M a tter o f________________________________________________ 229,235,236
P acific G reyh o u n d L in es, In c ., M a tter o f______________________________________________________________ 241
P e n n sy lv a n ia G reyh o u n d L in e s, In c ., m a tter o f____________________________________________________ 240-243
R a d io C orporation o f A m erica M a n u fa ctu rin g C o., In c ., M a tter of_______________________________ 250,25l
R em in g to n R a n d , In c ., M a tter o f______________________________________________________________________
248
S tah l-U rb a n C o ., M a tter o f______________________________________________________________________________ 238
T a m a q u a U n d erw ear C o m p a n y , M a tter o f____________________________________________________________ 230
U n iv ersa l F o ld in g B o x C o ., M a tter o f__________________________________________________________________ 236
W h eelin g S tee l C orporation, M a tter o f___________ ______________________________________________ 241,244,246
N a tio n a l L a b or R e la tio n s B o a rd v . F ried m a n -H a rry M a rk s C lo th in g C o ., I n c ________________________ 254
N a tio n a l L a b o r R e la tio n s B o ard v. F re u h a u f T railer C o __________________________________________________ 254
N a tio n a l L a b or R e la tio n s B o ard v . Jo n es & L a u g h lin S tee l C orp ora tio n ______________________________ 254,255
N a tio n a l L a b o r R e la tio n s B o ard v . T h e A sso cia ted P re ss_________________________________________________ 254
N a tio n a l L a b or R e la tio n s B o ard v . W a sh in g to n , V irg in ia & M a ry la n d C oach C o _____________________ 254
N a tio n a l L o ck C o ., M a tte r o f_________________ ______ _______________________________________________________ 228
N a tio n a l M e d ia tio n B o a rd __________________________________________________________________________ 57,58,224,252
N a tio n a l R e c o v e r y A d m in istra tio n . ( S e e N a tio n a l In d u stria l R e co v e r y A ct.)
N a tio n a l W a r L a b or B o a r d ----------------------------------------------------------------------------------------------------------10-13,19,86,219
E ffect o n tra d e-u n io n s____________________________________________________________________________________
20
E le c tio n s_________________
228
L eg a l a sp ec ts____________ ___________________________________________________________________________ 209,216-218
N a tio n a l W ar L ab or B o ard cases:
C orn P ro d u cts R efin in g C o ._ _____ ___________________________________________________________________ 130,218
N e w Y o r k C on so lid a ted R ailroa d _______________________________________________________________________ 216
P a cific E lectric R a ilw a y C o ______________________________________________________________________________ 217
P eterso n M a n u fa ctu rin g C o., A . H ---------------------------------------------------------------------------------------------------218,320
S a n D ie g o E le c tr ic R a ilw a y C o _________________________________________________________________________ 217
N a tio n a lity an d race o f w ork ers in p la n ts c o v er e d -------------------------------------------------------------------------------------- 292
N a u m k e a g S tea m C o tto n C o. (P e q u o t M ills )______________________________________________________________
26
N elso n V a lv e C o ______________________________________________________________________________________________
7
N e r st L a m p C o .________________
7
N e w E n g la n d T ra n sp o rta tio n C o ., M a tte r o f ______________________________________________________________ 249
N e w Y o r k C on so lid a ted R a ilr o a d ___________________________________________________________________________ 216
N o m in a tio n s _ ______ ____ ______ ________________________________________________________________ 122,124,258,267,276
N o rris-L aG u ard ia A c t_________________________________________________________________________________ ____ 214,225
N o r th C arolin a G ra n ite C orp oration , M a tte r o f_____________________________________________________ 229,235,236
N u m b e r o f c o m p a n y u n io n s____________________________________________________ 19, 20, 24. 25, 27, 28, 32-55, 66-59
N u m b e r o f w orkers in c o m p a n y u n io n s______________________________________ 16,19, 24, 25, 27, 32-55, 56-59, 281
O
O b jectives o f c o m p a n y u n io n s-------------------------------------------------------------------------------------------------------- 3,100-104,275
O fficers________________________________________________________________________________________________ 89,99,120-129
O fficers an d rep resen tatives, req u irem en ts for________________________________________ _____ _ 13,120-124,273,276
INDEX
309
Page
O p en sh o p —_________________ ______________________ __________________________________________________________ 23,261
O p tion al m em b ersh ip . ( S e e P articip a tion in co m p a n y u n io n .)
O rder o f S leep in g C ar C on d u ctors___________________________________________________________________________
20
O u tsid e co n ta cts_______________________________________________________________ 72,73,74,129,184-190, 202, 204,206
O u tsid e exp erts_______________________________________________________________________ 114,179,180,202,206,242,246
P
P acific E lectric R a ilw a y C o. ca se______________ _____________________________________________________________ 217
P a cific G rey h o u n d L in es, In c ., M a tter o f___________________________________________________________________ 241
24
P a cific M ills______ _____________________________________________________________________________________________
P articip a tion b a sis in com p a n y u n io n s (au tom atic or o p tio n a l)_____________________ 60-63,108-111
B y co m m itte e fo rm ____________________________________________________________________________ 110, 111, 130-132
B y m an n er o f electin g officers_________________________________________________________________________ 123,124
B y size o f p la n t.__________________________________________________________________________________________ 109
B y source o f fin an ces_______________________________________________________________ 62,63,110, i l l , 115,116,200
C h an ge from a u to m a tic to o p tio n a l___________________________________________________________________ 271,272
N . R . A . an d p re-N . R . A ____________________________________________________________ 61,109,110,203,204
E ffect u p o n collectiv e b a rg ain in g___________________________________________________________________________ 242
M a n a g em en t in itia ted or sp on sored -----------------------------------------------------------------------------------------------------85,105
W h ere e m p lo y ee m eetin g s w ere h e ld .______ _________________________________________________ 110, 111, 140,200
W h ere e m p lo y ee rep resen ta tiv es n ev er cam e in to d irect co n ta ct w ith h igh er c o m p a n y o ffic ia ls.._ 175
W h ere m a n a g em en t h a s so le p o w er to h ire an d fire____________________________________________________ 103
W h ere ob ject o f c o m p a n y u n io n w a s im p ro v em en t o f op eratin g e fficien cy _________________________ 104
W ith in d ep en d en ce o f rep resen ta tiv es g u a ra n teed _____________________________________________________ 127
W ith restrictio n s o n m e m b er sh ip ________________________________________________________________________ 113
W ith w r itte n c o n stitu tio n s_____________________________________________________________________________ 99, 111
P a r tic ip a tio n in c o m p a n y u n io n s, lim ita tio n s on:
A g e . .. . _____________________
200
E x e c u tiv e s e x c lu d e d ________ ______ ___________________________________________________________ 111, 112,270,271
L aid -off em p lo y ees e x clu d ed _________________________________________________________________________________113
L en g th o f serv ice______________________________________________________________________________ 112,200,203,274
L im ited to certain groups or cra fts_____________________________________________________________________ 112,192
M em b ers o f oth er lab or organ ization s e x clu d ed _________________________________________________ 112,113,271
P led g e o f lo y a lty req u ired ----------------------------------------------------------------------------------------------------------------------- 109
P en n sy lv a n ia G reyh o u n d L in es, In c., M a tter o f________________________________________________________ 240-243
P en n sy lv a n ia R ailroa d ______________________________________________________________________________________ 20,220
P en n sy lv a n ia R ailroad C o____________________________________________________________________________________ 220
P e n s io n s ..._______ ____________________________________________________________________________________ 16,21,104,231
P eo p le v. M e lv in _______________________________________________________________________________________________ 210
P eq u o t M ills ___________________________________________________________________________________________________
26
P eriod s o f form ation ___________________________________________________________________________________ 4, 7-28,50-55
P erson n el d ep artm en t:
C o m p a n y u n io n origin ated w ith ________________________________________________________________________
85
C on d en sed an d su m m a rized m in u te s___________________________________________________________________ 145
D e a lin g th ro u g h ________________________________________________________________________ 2,136,148,152,164-165
N u m b e r o f com p a n ies h a v in g _________________________________________________________________ 73,74,164,165
S u p p lied co m p a n y u n io n c o n stitu tio n -------------------------------------------------------------------------------------------------- 100
P erson n el m an agem en t:
C o m p a n y u n io n as ad ju n ct of____________________________________________________________________________ 4,19
D esire to im p rov e person n el relation s as reason for com p a n y u n io n ___________________________________81-83
In 1930-32 p eriod _____________
27
P eterso n M a n u fa ctu rin g C o ., A . H --------------------------218
P etitio n s:
A c ce p tin g c o m p a n y u n io n _____________________________________________________ 89 ,93,98 ,200 ,242 ,245 ,2 59 ,2 67
A s exp ressio n o f m e m b er s’ w ish e s___________________________________________________________ 140,153,172-173
A tta c k in g tra d e -u n io n ____________________________________________________________________________________ 189
N o m in a tio n b y ____________________________________________________________________________________________ 122
P etr o le u m L ab or P o lic y B o a r d ____________________________________________________________________________ 226,227
P etr o le u m L a b or P o lic y B o ard cases:
M a g n o lia C o _________
228
T ex a s C o ., M a tter o f th e _________________________________________________________________________________ 237
P h ila d e lp h ia C ord w ain ers ca se_______________________________________________________________________________ 210
P h ila d e lp h ia R a p id T r a n sit C o ______________________________________________________________________________
22
P ic k e t_________________________________________________________________________________________________________ 211,216
P r e sid e n t’s R e e m p lo y m e n t A g reem en t------------------------------------------------------------------------------------------------------- 226
P ro cter & G a m b le _____________________________________________________________________________________________
16
P ro fit sh a rin g.................................................................. ..................................................................................................... 21 ,27,126,177,181
310
INDEX
P age
Progressive Shoe W orkers’ U n ion ......................................... ............ .................................................................................. 247-248
Prom otions:
A rbitrary____ _______
21
E m p loyee representatives guaranteed against prom otion or dem otion____________________________ 127
O f em ployees w ho prom oted com pany u n ion____ ________________________________________________ 90,268
Seniority in __________________________________ ________________________________________________ 155,167,168
T o supervisory positions exclude em ployees from participation in com pany un ion s____________112,121
P roportional representation for com peting u n ion s___________________________________________________ 197,198
P u llm an C o _______________________________________________ _____________________________________________ 20,57
Purposes of com pany unions. { S e e O bjectives.)
Q u estion n aire u sed in m a il in q u ir y . _______ ____________ _________________________________________________ 284,285
R
R a d ic a ls______________ ____________________________________________________________________________ 21 ,23,104,164,267
R a d io C orporation of A m erica M a n u fa ctu rin g C o., In c ., M a tter of___________________________________ 250,251
R a ilro a d L a b or B o a r d ________ _____________________________________________________________________________ 219,220
R a ilro a d sh o p s________________________________________________________________________________________ 20, 58,220, 280
R a ilro a d sh o p crafts’ strik e of 1922__________________________________________________________________________ 20,220
R a ilro a d s, ty p e o f d ea lin g in ___________________________________________________________________ 20, 25,26, 56-59,280
R a ilw a y L a b or A c t o f 1926____________________________________________________________________ 213,215,220, 223,224
A m en d m en ts o f 1934___________________________________________________________________ 57,223,224,252-254,255
R e ca ll o f officers a n d rep re se n ta tiv e s_________________________________________________________ 13 ,123,124,271,276
R e co g n itio n o f c o m p a n y u n io n ordered w ith d r a w n ___________________________________ 221,234,238,243-244,249
R e co g n itio n o f trad e-u n ion :
G r a n te d ________________
192,259
R e fu se d _____ _________________________________________________________________________________ 20,84,19 3,26 1,27 2
U n d e r th e la w _____________________________________________________________________ 217,221,236,238
R e fe r en d u m _________
145
R eg io n a l lab or boards:
A d v ic e so u g h t fro m _________________________________________________________________________________ _____ 189
128
A r b itr a tio n _____________
C o d e v io la tio n s con sid ered b y ___________________________________________________________________________ 159
E le c tio n s c o n d u c ted b y __________________________________________________________ 156,231,268,272
H ea rin g s o n c o m p a n y ’s refu sal to recogn ize tra d e-u n io n ______________________________________________
84
O rdered reh irin g o f d isch a rg ed e m p lo y e e s------------------------------------------------------------------------------------ 89,160,259
R u lin g s as b a sis for c o m p a n y u n io n c o n sti
@FedFRASER