The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
>L d-l:c Guaranteed Wage Plans in the United States A Report on the Extent and Nature o f Guarantee Plans and the Experience o f Selected Companies Bulletin No. 925 UNITED STATES DEPARTMENT OF LABOR BUREAU OF LABOR STATISTICS DRURY COLLEGE LIBRARY U, S. DEPOSITORY COPY it it 90 1CHS UNITED STATES DEPARTMENT OF LABOR L. B. Schwellenbach, Secretary BUREAU OF LABOR STATISTICS Ewan Clague, Commissioner Guaranteed W age Plans in the United States Bulletin No. 9 2 5 For sale by the Superintendent of Documents, U. S. Government Printing Office, Washington 25, D. C. Price 35 cents Letter of Transmittal U n ited S ta tes D epar tm e n t of L a b o r , B u r e a u of L ab o r S ta tist ic s , Washington, December 29, 1947. The S e c r e t a r y of L abor: I have the honor to transmit herewith a report on guaranteed wage and employment plans, which was prepared in the Bureau’s Wage Analysis Branch with the cooperation of the Labor Economics Staff. The field investigations were conducted by the regional offices of the Wage Analysis Branch under the direction of Edith M . Olsen. The text was prepared by Philip Arnow and Edith M. Olsen. John L. Afros, formerly of the Bureau’s Labor Economics Staff, participated in the planning of the study and prepared the appendix on clauses used in guarantee plans and union contracts. Theodore Allison, Ida Pepperman, and Herbert Abowitz assisted in the preparation of the final report. E w a n C l a g u e , Commissioner. Hon. L. B. S C H W E L L E N B A C H , Secretary oj Labor. Preface In the summer of 1944 the Bureau of Labor Statistics began an inquiry into the subject of guaranteed wage and employment plans, anticipating a general demand for information on the nature of such plans and of the Nation’s experience with them. At the time the Bureau began its inquiry, union demand for a guaranteed annual wage was at issue in a dispute case before the National War Labor Board, involving the basic steel industry and the United Steel Workers of America. In rendering its decision in November 1944, the Board refused to grant the union’s demand under conditions prevailing at the time. However, in view of the lack of adequate information relating to guaranteed annual wage plans, it was recommended that a thorough study of the subject be made by a special commission to be appointed by the President. On March 20, 1945, the President designated the Advisory Committee of the Office of War Mobilization and Reconversion to survey “ the whole question of guaranteed wage plans and the possibility of their future development in American industries as an aid in the stabilization of employment and the regularization of production.” Following this action, the Bureau’s program was carried on in cooperation with the Guaranteed Wage Study Staff, designated by the Office of War Mobilization and Reconversion to investigate the problem. In December 1945, the Office of War Mobilization and Reconversion submitted to the Bureau of Labor Statistics a request for a survey of specific experiences with existing and discontinued guaranteed wage and employment plans. Parts I and III of this report appeared as Appendix C of the Final Report of the Guaranteed Wage Study Staff to the Advisory Board of the Office of War Mobilization and Reconversion, and were reprinted as Bureau of Labor Statistics Bulletin No. 906. iii Contents Page I. II. What is a guaranteed wage plan?______________________________________________ Historical development of plans: A. Initiation of plans___________________________________________________________ B. Discontinuance of plans______________________________________________________ III. Extent and nature of guaranteed wage or employment plans in the United States: A. Currently operating plans: 1. Prevalence_______________________________________________________________ 2. Characteristics___________________________________________________________ B. Discontinued plans__________________________________________________________ IV. Experience with guarantee plans in 62 selected cases: A. Circumstances of introduction: 1. Pre-plan employment situations___________________________________________ 2. Stable employment for part of the work force_____________________________ 3. Previous efforts to stabilize employment__________________________________ 4. Responsibility for initiating guarantee____________________________________ 5. Objectives of the plans___________________________________________________ 6. Extent of planning at time of introduction_______________________________ 7. Effect on wages and working conditions__________________________________ B. Outstanding features of the guarantees: 1. Character of the obligations assumed_____________________________________ 2. Duration of the guarantee________________________________________________ 3. Firmness of the guarantee________________________________________________ 4. Computation of the guarantee____________________________________________ 5. Transfers________________________________________________________________ 6. Administration__________________________________________________________ C. Experiences of operation: 1. Meeting of guarantee obligations_________________________________________ 2. Effects of business depression_____________________________________________ 3. Discontinued plans_______________________________________________________ 4. Operation under Section 7 (b) (2)________________________________________ 5. Costs____________________________________________________________________ D. Management and labor evaluation of results: 1. Accomplishments of the plans in the field of employment security___________ 2. Other accomplishments__________________________________________________ A. Basic data on 62 plans studied by the Bureau of Labor Statistics_______ B. Clauses used in guarantee plans and contracts__________________________ Index to Appendix B ________________________________________________________________ A p p e n d ix A p p e n d ix v 1 3 6 9 10 15 , 17 21 22 25 25 28 28 30 32 32 33 33 34 34 35 38 40 42 43 48 50 62 89 * Guaranteed Wage Plans in the United States I. What is a Guaranteed Wage Plan? The Bureau of Labor Statistics has included in its study of guaranteed wage or employment plans arrangements, written or unwritten, by which an employer guaranteed or assured to some or all of his employees, in advance, a definite period of employment equal to at least 3 months a year, or an equivalent amount of wages. This definition is broad, and covered plans framed in a variety of ways: plans which were designated as “ guarantees” by the employers and unions which operated under them, and plans which did not carry the title of “ guarantee” but which in fact operated as guarantees. In a rela tively small number of cases, the plans provided for an “ annual wage.” In the majority of cases, employment was guaranteed for a stated number of weeks per year and hours per week, frequently less than 52 weeks per year and 40 hours per week. In practice, these guarantees of employment, as well as the few guarantees that were explicitly stated in terms of wages, did guarantee wages for the total number of hours a year over which em ployment was guaranteed. A distinction between “ guaranteed wage” and “ guaranteed employment” plans was unnecessary for the purpose of this study. Despite the general inclusiveness of the defini tion employed, a number of problems arose re specting its application in borderline situations. The distinction between a guarantee plan and a private unemployment benefit plan, for example, was difficult to draw. The latter plans were in cluded only where the period of time over which benefits were paid was 3 months or more and where there was a commitment to pay benefits regardless of the size of reserves set aside for this purpose. It was difficult also, in many instances, to draw the line between a guarantee and an employer’s oral pledge that work in his establishment would be “ steady.” A large degree of stability is in herent in many types of industry. Moreover, many employers have maintained fairly stable em ployment in their plants, frequently as a result of planned production and hence employment regularization, without instituting formal guar antees. The volume of employment regulariza tion planning in this country is, in fact, far greater than that encompassed by the actions of the firms that have guaranteed wages or employment. The practice of employing white-collar personnel on an annual rate basis is widespread, especially in government, financial, and institutional estab lishments. Guarantees of minimum weekly hours or wages are found in many labor agreements, notably in the meat-packing and trucking indus tries; the practical effect of these arrangements is to afford a guarantee of almost full weekly earnings even when wage earners work only dur ing some part of each week. In none of these situations, however, is there a formal pledge or assurance of continued employment, and the em ployee is not free from the possibility of lay-off or loss of his job. Oral arrangements (amounting to 36 percent of the currently operating plans in cluded in the study) were included only where there was a formal guarantee or assurance of con tinued employment or wages. Many of the plans contained the theoretical pos sibility of abrogation or modification during the life of the guarantee period under various cir cumstances. Provisions for modification or can cellation of an announced guarantee did not result in exclusion of the plan from the study. The so-called wage advance plan was another type of guarantee which raised questions of in clusion. Such plans are sometimes regarded as loan arrangements, because their central feature is the advancement of wages by the employer during short-hour weeks, and the repayment by workers during weeks in which longer hours are worked. 1 2 GUARANTEED WAGE PLANS IN THE UNITED STATES They are different from loan plans in essential characteristics, however. Where there was no obligation to repay the advance unless the em ployer provided sufficient work to enable the advance to be repaid, the plan was considered to be a guarantee of wages or employment for the maximum period over which wages were advanced. These plans were included in the study. On March 1, 1945, the Bureau of Labor Statis tics mailed a brief questionnaire to about 90,000 employers for the purpose of determining the extent to which guarantee plans had been adopted in the United States. From the replies to this questionnaire, from a canvass of previous studies and available literature on the subject, and from a list of employers who had filed contracts with the Wage and Hour and Public Contracts Divisions under Section 7 (b) (2) of the Fair Labor Stand ards Act, the Bureau was able to compile a list of firms which appeared to have had a guaranteed wage or employment plan in effect at -some time. The Bureau then conducted a field inquiry to de termine finally whether these arrangements ac tually met the requirements of the definition of guaranteed wage or employment plans used in this study, and whether these plans had actually oper ated. At the same time, information was collected on the basic features and provisions of those plans which met the definition that had been established. A total of 241 plans (196 still in operation and 45 that had been discontinued) were surveyed in this manner and are included in the tabulations in this report. To this group were later added 106 addi tional discontinued plans about which informa tion was obtained subsequent to the field survey. This number included 96 cases which operated under the Wisconsin unemployment compensation law in 1934 and 1935. In addition, the Bureau made more specific and detailed investigations of the operations of 62 of the plans and the situations into which they were introduced. The material gathered in the course of this subsequent investigation is presented in part IV of this report. II. Historical Development of Plans1 A. Initiation of Plans Until the passage of unemployment compensa tion legislation, the history of guarantee plans was part of the history of individual efforts, unaided by government, to mitigate the effects of unem ployment in particular industries and plants. During this early period, the idea of guaranteeing wages was not differentiated from other unem ployment compensation arrangements. In fact, the term “ guaranteed wages” was not used in connection with early plans that have since come to be known as “ guaranteed wage” or “ guaranteed employment” plans. A good example of this situation was reflected in the language of the Procter & Gamble Co. plan, introduced in 1923, which provided a 48-weeks-a-year guarantee of employment by assuring that no worker would be unemployed for more than 4 weeks a year. Trade-union sponsorship and individual em ployer initiation were both important in the early history of guarantees. During the nineteenth century, trade-union activity had in several in stances encompassed the furnishing of out-of-work benefits to members, but such arrangements, of course, carried no obligations by employers to furnish work. The first plans in which employers assumed responsibility for providing work or wages were those of the decade of the 1890’s, negotiated in the wallpaper industry, by brewery workers, by textile printers in a New Jersey dyeing and finishing establishment, and established by a small midwestern retailer of sporting goods. Best-known among the early guarantee plans were those in the wallpaper industry. A guar antee of 11 months’ employment was first intro duced in 1894, as a result of negotiations between the National Association of Machine Printers and Color Mixers and the National Wall Paper Com pany, then a newly formed amalgamation control ling from 50 to 75 percent of the,industry. In 1896 the guarantee was extended to 12 months a year; modifications were made in subsequent 772334 ° — 48- -2 years. The independent companies in the industry followed the bargaining pattern set by the largest firm, and the plan became industry-wide for members of the wallpaper association who bargained with the union. Similar arrangements were made by negotiation with the National Print Cutters’ Association of America, which in 1923 joined with the National Association of Machine Printers and Color Mixers to form the United Wall Paper Crafts. Among the other early arrangements, the case involving the National Union of the United Brewery Workmen of the United States is known to have arisen in at least two areas, Philadelphia and New York, and took the form of contract pro visions restricting lay-off of regular employees to no more than specified numbers of days during the dull season of the year. The agreement between the Machine Printers Beneficial Association and a New Jersey textile finisher provided each journey man printer full pay for any period of unemploy, ment prior to July 15 of each year, and half pay for any period of unemployment during the remainder of the year. The plan of the midwestern sporting goods retailer provided an oral guarantee of 52 weeks’ pay each year to all employees who had passed a probationary period of approximately 90 days. Guarantee plans introduced during the early years of the twentieth century involved small establishments in which employers made oral com mitments to all or some of their workers to pro vide-them with year-round employment. A retail men’s furnishing store, starting in 1905, guaran teed permanent employees 52 weeks of work at full weekly hour&; a coffee-roasting establishment, in 1912, began to pay its production workers full weekly pay during slack season weeks; a poultry cleaning establishment began, in the followingi i The material in this section of the report is based upon data gathered by the Bureau of Labor Statistics and upon published accounts of guaranteed wage or employment plans. 3 4 GUARANTEED WAGE PLANS IN THE UNITED STATES year, to guarantee 52 weeks of full-time employ ment to permanent workers; a small department store began the same guarantee in 1914; and a small drug firm about 30 years ago instituted a year-round weekly wage payment plan covering 2 employees. The next well-known plan, that of the Columbia Conserve Co., of Indianapolis, a producer of soups and other canned products, appeared in 1917. The guarantee was part of a broader social experi ment which included profit-sharing and an em ployee council to give permanent workers a voice in the management of the enterprise. Phases of the experiment which attracted public attention included the steps taken by the company after introduction of the plan to level out its normally seasonal production pattern, and the eventual turning-over of ownership to the permanent work ers covered by the guarantee. Employer interest in the problem of employ ment security is reported to have increased sub stantially after the business depressions of 1914 and 1921, and also as a result of the increasing general interest in scientific management and im proved personnel procedures. A number of un employment benefit plans, many of which had characteristics that are currently attributed to guarantee plans, were adopted during the period between 1919 and the passage of Federal and State unemployment compensation legislation. These plans typically provided for the payment of outof-work benefits rather than for a guarantee of continuous employment. Where the unemploy ment benefits covered an extended period of time, the line of demarcation between an unemployment benefit plan and a guarantee plan was difficult to distinguish. As has already been indicated, un employment benefit plans that provided assurance of benefits for 3 months or more have been included in the data on guaranteed wage or em ployment plans presented later on in this report. Several unemployment benefit plans are worthy of mention at this point because of their similarity to many of the early guaranteed wage or employ ment plans. None of them was included in the data contained in subsequent sections of this re port, because they did not meet the 3-month guarantee test referred to above. In 1919 the Dutchess Bleachery, followed in 1920 by an af filiate, the Rockland Finishing Co., began setting aside part of its profits in order to provide its workers half pay during periods of unemploy ment. The American Cast Iron Pipe Co. intro duced an unemployment benefit plan in 1924; the Brown & Bailey Co. did likewise in 1927. During the same period of time, a number of unemploy ment benefit plans were introduced by joint agree ment between management and labor, notably in the needle trades in New York and Chicago, and in the hat and lace industries. Among the plans introduced during the 1920’s that can be classed as guarantees, the most notable were the joint agreements of the Cleveland gar ment industry and the In ti Ladies’ Garment Workers’ Union (1921), the plan of CrockerMcElwain Co. and its affiliate, the Chemical Paper Manufacturing Co. (1921), the Proctor & Gamble Co. plan (1923), and the joint agreement between the Seaboard Air Line Railway Co. and a federation covering its shop craft employees (1928). The plan in the Cleveland ladies’ gar ment industry was the first of several unemploy ment compensation devices introduced in the apparel industry during the 1920’s, and the only one that qualified as a guarantee under the definition used in this study. By agreement with the Int’l Ladies’ Garment Workers’ Union, Cleveland apparel manufacturers guaranteed 20 weeks of full employment in each 6-month period (later changed to 40 weeks a year), at two-thirds of minimum weekly wages (later changed to half of minimum wages). The Crocker-McElwain plan assured year-round em ployment at full pay to workers with at least 5 years’ service; in subsequent years this plan was modified to provide, finally, less than 50 percent of full-time annual compensation. The Procter & Gamble plan assured 48 weeks’ employment to all workers with at least 6 months’ service. Since the time of its introduction, the plan has been somewhat modified, principally by limiting eligi bility to workers with at least 2 years’ service. The Seaboard plan as originally introduced was a guarantee of annual employment for an agreedupon number of shop employees each year. As was the case /during the earlier two decades of the century, the occasional introduction of a less formal plan by small employers continued. A shoe retailer -guaranteed and maintained yearround employment to 15 regular employees start ing in 1923; a commercial machinery wholesaler guaranteed 52 full weeks’ pay a year to 2 service HISTORICAL DEVELOPMENT OF PLANS mechanics; beginning about 1924, a Michigan coal dealer guaranteed weekly wages throughout the year to 7 employees regardless of prevailing con ditions; in the same year, a garment manufacturer introduced a guarantee of 52 weeks* full pay cov ering a group of key workers; from 1 to 4 plans of similar character were introduced during each of the remaining years of the 1920*s. Introduction of guarantees and unemployment benefit plans continued during the depression of the early 1930*s. The General Electric Co. in 1930 adopted an unemployment pension plan, covering 12 of its electrical apparatus manufactur ing plants, and in 1931 adopted a plan guarantee ing 50 weeks* work of not less than 30 hours each (modified in subsequent years) to employees with 2 years or more service in 12 lamp manufacturing plants. The Wm. Wrigley, Jr., Co. in 1934 adopted an employment assurance plan with unemploy ment benefits varying according to a sliding scale dependent on pay level and length of service. The plan of Geo. A. Hormel & Co., meat packers of Austin, Minn., was started on a small scale in 1931 and its scope gradually extended until in 1940 it covered all but a small percentage of the com pany *s employees. During and following the depression of the early 1930*s, the character of the plans introduced shifted from guarantees of unemployment bene fits to guarantees of continued employment. Compulsory unemployment insurance legislation was adopted in Wisconsin in 1932 and at later dates in other States, the latter chiefly under the provisions of the Federal Social Security Act. The legislation permitted modification of the con tribution of tax features in the cases of employers who provided guarantees of employment or wages equivalent to legislatively established standards. The chief, and as far as can be ascertained the only, direct effect of the legislation upon the in troduction of guarantee plans occurred in the case of the Wisconsin law, which completely exempted from the unemployment tax employers who guar anteed 42 weeks* pay (at 36 hours a week, changed in 1935 to 40 weeks at two-thirds of full-time) to their workers. A total of 96 employers operated guarantee plans under this law for a period of slightly more than a year, beginning in 1934 and ceasing at the end of 1935. At that time the stat utory provisions in Wisconsin were changed to conform to the requirements of the Federal stat 5 ute, applicable to all State unemployment com pensation laws, under which employers who guar anteed employment or wages were given tax credits, but not complete exemption. Only six additional States— California, Florida, Idaho, Indiana, Minnesota, and Oregon— are reported to have made provision in their unemployment com pensation laws for guarantee plans, but none of them implemented the clauses with the necessary administrative regulations. No guarantee plans were ever adopted under these laws. Further legislative provision affecting guarantee plans was made in 1938, when the Fair Labor Standards Act was adopted. Under Section 7 (b) (2) of this act, exemption from penalty over time provisions (up to 12 hours a day or 56 a week) was granted in cases where a worker was employed— on an annual basis in pursuance of an agreement with his employer, made as a result of collective bargaining by representatives of employees certified as bona fide by the National Labor Relations Board, which pro vides that the employee shall not be employed more than 2,080 hours during any period of 52 consecutive weeks.2 To date, very few employers have used this ex emption. The most substantial plan operating under the provision is that of Geo. A. Hormel & Co., which had been in operation prior to the passage of the Act. During the period following the depression of the early 1930*s, greater numbers of plans were introduced yearly than in any year prior to the depression. During the years 1938^2 new plans were introduced at the rate of from 19 to 23 a year, compared with a maximum of 4 a year during the 1920*s, and from 2 to 6 during the early 1930*s. The latter half of the 1930*s saw the introduction of a number of “ basic crew** provisions in agree ments in the wholesale and retail trades. Under these contracts, specified numbers of workers, ranging from less than half to well over threequarters of the work force, were guaranteed full weekly wages throughout the year. Another of the well-known plans, that of the Nunn-Bush Shoe Co., was established in 1935. This plan early in 1946 guaranteed a continuous 2Prior to October 1941, the maximum number of hours that an employee might work in a year for the 7 (b) (2) overtime exemption to apply was 2,000 hours. In October 1941, an amendment to the Act changed the limit from 2,000 hours to 2,080 hours (the equivalent of fifty-two 40-hour weeks.) 6 GUARANTEED WAGE PLANS IN THE UNITED STATES employment relation to workers with the greatest seniority, and provided that the total earnings of all workers with 2 years’ service (including, but generally exceeding, the number of workers who had the employment relation guaranteed) should be a predetermined proportion, no less than 20 percent, of the wholesale value of the company’s product. Workers shared in this amount in proportions determined by rates which reflected job differences. By the beginning of 1946, according to the in formation which has been compiled by the Bu reau, a total of 347 plans which met the definition used in this study had been introduced. A yearby-year tabulation of the time of their initiation is shown in table 1. T 1 . — Number of guaranteed wage or employment plans covered in Bureau of Labor Statistics survey , by year of initiation able Year of initiation Total. _ ______ Number of plans ' 1347 Prior to 1900 1905 1912 ____ 1913................................. 1914 _______ _______ 1916______________ ____ 1917_______ ___________ 1918___ ____ __________ 1919 ___ 1920________ ___________ 1921 ___ 1922 ____________ 1923 1924 ____ _____________ 1925 ............. .............. 1926 ............................ 1927______ _____________ 3 1 1 1 1 1 1 1 1 4 3 1 4 3 2 2 2 Year of initiation 1928______ ____________ 199Q 1930___________________ 1931___________________ 1932___________________ 1933___________________ 1934___________________ 1935___________________ 1936___________________ 1937__________________ 1938___________________ 1939___________________ 1940___ _*_____________ 1941___________________ 1942___________________ 1943___________________ 1944___________________ 1945___________________ (Data not available)__ Number of plans 1 4 2 5 6 6 1102 17 11 10 23 20 19 21 19 8 21 9 11 1 Includes 96 plans initiated in 1934 under the encouragement of the tax exemption provisions of the Wisconsin unemployment compensation law. B. Discontinuance of Plans Of the plans known to the Bureau of Labor Sta tistics that had been introduced up to the begin ning of 1946, 196 were still in existence at that time. The remainder, a group including all of the 96 plans introduced in 1934 under the Wisconsin unemployment compensation law and 55 others, had been discontinued before the end of 1945. In the case of the 96 Wisconsin plans and a small number of others, discontinuance resulted from the circumstances surrounding the introduction of compulsory unemployment insurance legislation. In the case of the Wisconsin plans, amendment of the State law to conform with the requirements of the Federal Social Security Act removed the tax exemption which the companies had enjoyed under the former statute, and the employers there after individually elected not to come under the guaranteed account provisions of the legislation. In a few other cases, plans that had been instituted prior to the passage of compulsory unemployment compensation legislation were discontinued upon the passage of such laws because it was believed that the objective which the plans were designed to meet was met by those laws. In the remainder of the cases, discontinuance was largely the result of special individual circum stance, but on the whole the result of problems facing the individual employer. In a number of cases the general state of business conditions at the time the plans were discontinued was a minor influence. Two of the earliest plans abandoned were those of the American Cast Iron Pipe Co., discontinued in 1926, and the Consolidated Water Power & Paper Co., discontinued in 1929. Only incom plete information is available on the reasons for their discontinuance: The former was discontinued on the eve of a major technological change in the industry, the latter during a period of relatively full employment. The wallpaper plan— one of the earliest begun—was discontinued in 1930, after a considerable amount of dispute over the plan’s ad ministration, and in a period when depression conditions and the rise of substitute materials were seriously affecting the industry. The plan of the United Diamond Works, under which benefits had been paid for almost a full year during the 1921-22 depression, ended in 1931, fol lowing a period of uncertainty in the industry to which international tariff problems contributed. In the same year the unemployment benefit plans of the Brown & Bailey Co. and the Cleveland gar ment manufacturers were discontinued; in the lat ter case the reason is reported to have been the long-range decline of the local market and the shift in the character of the industry. The plans of the Leeds & Northrup Co. and the Dennison Manufacturing Co. were discontinued in 1932 when their unemployment benefit reserves were exhausted. The depression years also saw the dis appearance of many of the unemployment benefit plans not included in this study (those that could not meet the test of a 3-month guarantee)-, result ing chiefly from depletion of their individual unemployment compensation reserves. 7 HISTORICAL DEVELOPMENT OF PLANS Of the plans discontinued after the depression of the early 1930’s, 15 were studied in detail by the Bureau, and information is available concern ing the circumstances of their discontinuance. The effects of the depression seem to have been an im portant contributory cause of abandonment in only one case, where the guarantee was substantially modified to provide less than 50 percent of the earnings originally guaranteed, and the plan was finally abandoned in 1937. Four of the plans were abandoned during World War II, largely as a result of wartime business uncertainties. Four were abandoned after management had come to the conclusion that the plans were not needed, be cause the employer was able to provide substan tially more work than the guarantee assured. All but one of these plans had been in existence for 3 years or less, and all were abandoned between the years 1939 and 1942. Three plans— two of which were introduced to avoid overtime compensation and one of which was introduced as an alternative to a wage increase— were abandoned as a result of employee dissatisfaction with the plans and union opposition. One of the remaining three plans was abandoned following the passage of unemploy ment compensation legislation; another was ended during World War II when management became worried about possible conflict between its obliga tions under the plan and its obligations to return ing veterans, and when a newly organized union showed indifference to the plan’s continued exist ence. Finally, the plan of the Columbia Conserve Co., which had operated successfully over a period of 25 years and through three periods of business depression, was abandoned as the aftermath of a labor dispute. Wages and union organization had arisen as issues among the employee-owners, re sulting in a National War Labor Board dispute case and a court suit. The employee-ownership feature of the plan was ended by court order as a result of the suit, and the management of the com pany simultaneously ended the guarantee. In this case, as in a number of other cases where plans were discontinued, management and union repre sentatives expressed great interest in possible fu ture attempts at guaranteeing employment or wages. As can be seen from table 2, guarantee plans were discontinued from time to time during the entire span of years over which plans have been in existence. With the exception of the year 1935, T a b l e 2.— Number o f discontinued guaranteed wage or em ployment plans covered in Bureau of Labor Statistics sur vey, by year o f discontinuation and number o f years o f existence at time of discontinuation 1 Includes 96 plans initiated in 1934 under the encouragement of the tax exemption provisions of the Wisconsin unemployment compensation law, and discontinued in 1935 when the tax exemption was eliminated. when the 96 Wisconsin plans were discontinued, there is no significant concentration. It is notice able, too, that the discontinued group includes plans which had been in existence for varying lengths of time. Some, like the wallpaper plan and the plan of the Columbia Conserve Co., were T a b l e 3.— Total number of guaranteed wage or employment plans covered in Bureau of Labor Statistics survey that were in operation each year, 1893—1945 Year 1893__________ ________ 1894-95____ ____ _______ 1896-1904_______ _______ 1905-11............................. 1912___________________ 1913......... ......................... 1914-15................. ....... 1916 _______ ______ 1917.................................. 1918____ ______ _______ 1919 .......................... 1920.................................. 1921 ____________ ______ 1922 ........ ............... 1923_______ ____ _______ 1924______ ____________ 1925____ _____ _________ 1926___________ ______ 1927___________________ 1928______________ _____ Number of plans in opera tion at the end of each year 1 2 3 4 5 6 7 8 9 10 11 15 18 19 23 26 28 29 31 32 Year 1929.................. .............. 1930________ __________ 1931___________________ 1932___________________ 1933_______ ______ ____ 1934........... ....................... 1935_____________ _____ 1936____ ________ ______ 1937___________________ 1938_________ _________ 1939 ___________ _____ 1940_____________ _____ 1941............. ..................... 1942 ____________ ____ _ 1943....1______________ 1944___________________ 1945___________________ (Data not available— 11 plans)____________ Number of plans in opera tion at the end of each year 35 36 38 41 46 i 148 68 79 87 107 125 138 154 166 167 183 185 196 1 Includes 96 plans initiated under the encouragement of the tax exemption provisions of the Wisconsin unemployment compensation law in 1934 and discontinued in 1935 when the tax exemption was eliminated. 8 GUARANTEED WAGE PLANS IN THE UNITED STATES among the oldest plans on record, while others had been in operation for only a few years when they were dropped. As has already been shown, the net result of the continued inauguration of new plans and the discontinuance of others was a total of 196 during January, 1946. With the exception of the year 1935, when the 96 plans adopted under the Wis consin unemployment compensation law were dis continued, the picture, as shown in table 3, has been one of constant growth of the number of plans in existence, at an accelerated rate during the period since 1934. The plans that were in existence in January 1946, as shown in table 4, had been in operation over varying periods of years. Approximately one-third had been in operation for 10 years or longer, and 11 plans had been in operation for 25 years or more. T a b l e 4. — Number of currently operating guaranteed wage or employment plans in Bureau of Labor Statistics survey, by number of years in existence (as of January 1946) Number of years in existence Total___________ Number of plans still in operation 196 Number of years in existence 10 years 11 ypfl.rs Less than 1 year____ __ _ 1 year______ ___________ 2 years __________________ 3 years. ______ ___________ 4 years. ________________ 5 years____ __ _______ 6 years___ _______ ____ 7 years____ _______ ._ _ 8 years________ __________ 9 years___ _____ 7 2 19 7 17 13 17 14 11 8 12 years 13 years 14 years 15 to 19 years 20 to 24 years 25 to 29 years ’ 30 to 34 years 35 years and over Not available___________ Number of plans still in operation 9 7 6 6 5 8 8 4 4 3 11 III. Extent and Nature of Guaranteed Wage or Employment Plans in the United States A. Currently Operating Plans 1 . Prevalence In January 1946, the 196 guaranteed wage or employment plans known by the Bureau of Labor Statistics to be in operation in the United States covered a total of approximately 61,000 workers. Some of the plans were master contract arrange ments, involving a number of employers and unions in the same industry and community, and others were plans which covered several plants of the same company. As a consequence, the number of establishments was, of course, considerably greater than the number of plans. There were, in all probability, additional bona fide plans that were not included in the study. Compared with the total number of establishments or wage earners in the United States, the coverage of all guaranteed wage or employment plans is small. It is esti mated to be well below 1 percent of the total num ber of wage earners employed in nonagricultural, nongovernmental establishments. The significance of the plans lies, however, in their provisions and accomplishments, rather than in their prevalence. The 196 plans were found in a great many in dustries. Almost 40 percent of them, involving 38 percent of total employment covered, were in manufacturing industries. Within the manufac turing group, the plans were most frequently found in industries which have substantial seasonal variations, and those which produce for consumer demand. The greatest numbers of plans occurred in establishments manufacturing food products— brewing, meat packing, grain, and flour; in textile mills— primarily in dyeing and finishing establish ments; and in apparel companies. Relatively few plans were found in heavy or basic manufacturing industries, which are subject to much wider cyclical fluctuations, but often to less marked seasonal variation (table 5). Outside manufacturing industries, the greatest number of plans was in the retail trade group. As in the case of the manufacturing industries which produced consumer products, the estab lishments in retail trade were in many instances in lines of activity that were subject to significant seasonal variation: mail order houses, clothing stores, department stores. The same was true of establishments in wholesale trade, which con tained the next most numerous group. T a b l e 5.— Number o f currently operating guaranteed wage or employment plans covered in Bureau of Labor Statistics survey, by industry group Industry group Number of currently operating plans Total plans___________________________________________________ 196 Manufacturing, total_________________________________________ Food and kindred products_______________________________ Textile-mill products_____________________________________ Apparel and other finished products made from fabrics and similar materials_______________ ____ ___________________ Lumber and timber basic products_______________________ Paper and allied products________________________________ Printing, publishing, and allied industries________________ Chemical and allied products_____________________________ Leather and leather products_____________________________ Stone, clay, and glass products____________________________ Iron and steel and their products_________________________ Nonferrous metals and their products_____________________ Machinery (except e le c t r i c a l) ______ ___________________ Electrical machinery_____________________________________ Transportation equipment (except automobiles)__________ Miscellaneous manufacturing industries__________________ 75 21 15 12 1 3 8 5 1 1 2 1 2 1 1 1 Nonmanufacturing, total_______________ Nonmetallic mining and quarrying. _ Construction—general contractors__ Wholesale trade____________________ Retail trade________________________ Real estate_________________________ Railroads___________________________ Water transportation_______________ Warehousing and storage___________ Services incidental to transportation. Communication____________________ Heat, light, and power______________ Services________________: ___________ Nonprofit membership organizations. 121 1 3 23 56 2 1 1 1 1 10 2 19 1 The majority of the establishments that guar anteed employment or wages were located in the industrial regions of the country. More than 70 percent of the 196 were in the Middle Atlantic and Great Lakes regions, and almost 45 percent were in the cities of New York, Chicago, Cleve land, and Philadelphia. Very few were found 9 10 GUARANTEED WAGE PLANS IN THE UNITED STATES in the Southeast, Southwest, or West. The fol lowing cities had the largest numbers of plans: Chicago, 111_________________________________ 10 Cleveland, Ohio____________________________ 10 Detroit, Mich______________________________ 6 Milwaukee, Wis____________________________ 5 New York, N. Y _____________________________ 61 Philadelphia, Pa____________________________ 5 Plans were found in establishments of all sizes, although most of them were in small establish ments. Table 6 contains a distribution of the total number of wage earners in establishments covered by the plans in 172 cases for which such information was available. While in several cases the employment data for individual plans group together the employment of a number of estab lishments, as in the cases of master contracts and companies with more than one establishment un der the same plan, the table gives a fairly good picture of the size of the establishments involved. About 55 percent of the plans were in employing units of less than 50 persons; an additional 10 per cent of the plans were in employing units of 50 to 100 persons. Ten percent of the plans were in employing units of 1,000 persons or more. T 6 . — Number o f currently operating guaranteed wage or employment plans covered in Bureau o f Labor Statistics survey , by total number of wage earners able Total number of wage earners in establishment or establish ments covered by plan Total. ___________ _____________________________________ Less than 25_____________________ _ ______ _______ ______ 25 to 49___________________________________________________ 50 to 74____________________________________________________ 75 to 99_____________ ______________________________________ 100 to 249_____________________ _________________________ 250 to 499__________________________________________________ 500 to 749__ _______________________________________________ 750 to 999__________________________________________________ 1,000 to 2,499____ ____ ________________________________ 2,500 to 4,999 ___________________ _____________________ 5,000 to 7,499 _____________________________________________ 7,500 to 9,999 _________________________________ ____________ 10,000 and over ______ ___________________________________ Total employment not available___________ _____________ Number of currently operating plans 1 196 64 29 13 5 23 2 14 3 3 26 26 2 1 3 8 24 1 A guaranteed wage or employment plan embodied in a master contract between a trade association and a union is counted as a single plan, and is classified according to the total number of wage earners in all of the covered establishments. There are 10 such cases. 2 Includes 1 master contract plan. 8 Includes 7 master contract plans. In 130 of the 196 plans, unions represented the employees covered by the guarantees in general collective bargaining relations (table 7). Where one union was involved, the unions were AFL affiliates in 36 cases, CIO affiliates in 64 cases, and were unaffiliated in 13 cases. In 17 cases there were 2 or more unions of different affiliation rep resenting the workers. Where unions represented the workers, the provisions of the guarantee were generally incorporated in a collective bargaining agreement. In a number of cases, however, the plans were introduced prior to unionization and have not since been included within the scope of collective bargaining. T a b l e 7.— Number of currently operating guaranteed wage or employment plans in Bureau of Labor Statistics sur vey, by representation of covered workers Representation of covered workers Total__ ______________________ ___________________ ________ Nonunion____________________________________________ __ Union______________________________________ _____ __ __ A F L affiliate_______________________________ ___________ _ CIO affiliate_________ . . . _______. . . ....................... . Unaffiliated union______ __________ _________ ___ _ 2 or more unions with different affiliations_____ _ ........... Number of currently operating plans 196 66 130 36 - 64 13 17 2, Characteristics The basic features of the guarantee plans may be characterized best in terms of the kinds of workers eligible for coverage and the require ments which workers must meet before they are eligible for benefits, the proportions of workers actually covered, and the amounts of wages or employment guaranteed. In 101 of the 196 plans, as indicated in table 8, coverage under the plan was open to all or nearly all workers (in some cases to all production workers, and in others to some or all other wage earners as well, including office workers, super visory force, salesmen, etc.). In 63 of these cases, employees automatically became eligible upon hir ing or within 30 days thereafter. Service require ments, ranging from 3 months to more than 5 years, were applicable in all but 4 cases; in these the duration of the requirement was indefinite, depending upon the employer’s judgment concern ing the necessary probationary period. In a large number of cases, especially where there were union contracts, the eligibility period coincided with the probationary period provided in the contract for the attainment of permanent status or a place upon the seniority rolls. Coverage was open only to employees in “ reg ular” jobs in 35 of the 196 plans. The limits of this kind of coverage were in some cases estab lished by “ basic crew” contract provisions that specified the number of workers who were to be 11 EXTENT AND NATURE OF GUARANTEE T 8 .— Eligibility requirements in currently operating guaranteed wage or employment plans in Bureau of Labor Statistics survey, by representation o f covered workers able Number of currently operating plans Eligibility requirement Total Union Non union Total--------------------------------------------------------------- 196 130 66 Coverage open to all employees.______________ Upon hiring or after service of 30 days or less_____________________________________ Upon service of 3 months_________________ Upon service of 6 months_________________ Upon service of 1 year____________________ Upon service of 1Mi to 5 years_____________ Upon service of 5 years or m ore.................. Upon selection by employer______________ 101 54 47 63 4 9 9 7 5 4 37 2 4 5 4 2 26 2 5 4 3 3 4 35 29 6 51 45 6 36 9 32 7 4 2 Coverage includes only employees in “ regular” jobs'________________________________________ Coverage open only to employees in specific departments or occupations________________ Upon hiring or after service of 30 days or less________________________ ____________ Upon service of 3 months or more________ Upon selection by employer........................ Employees in “ regular” jobs only------------Unknown________________________________ Coverage confined to key employees. 2 3 1 9 2 _______ operating guaranteed wage or employment plans in Bureau o f Labor Statistics survey , by eligibility provisions Number of currently operating plans with eligibility open to— Num ber of Employ cur Percentage of total wage earn Em ees in rently ers covered by guarantee specific All Key ploy oper depart employ ating employ ees in ees regular ments or plans ees occupa jobs tions Total_________________________ 196 Under 5 percent. _. . . . . . 5 and under 10 percent___ 10 and under 20 percent___ 20 and under 30 percent.. ___ 30 and under 40 percent 40 and under 50 percent______ 50 and under 60 percent______ 12 13 7 12 10 10 11 17 15 14 9 38 28 60 an d u n d e r 7ft p e r c e n t 7ft a n d u n d e r 8ft p e r c e n t 80 and under 90 percent Oft a n d u n d e r Iftft p e r c e n t 100 percent Data not available_____ _____ 101 35 51 9 1 12 12 5 7 3 3 4 1 1 2 1 2 1 1 4 1 3 5 2 4 13 11 12 8 38 5 4 2 3 4 2 1 18 3 ________ 1 _____ 2 7 covered, and in other cases were established by specific elimination of “ temporary,” “ extra,” or other similar groups of workers. Limitation of the guarantee to regular workers occurred chiefly in retail and wholesale establishments, and additional length-of-service requirements were either non existent or brief. In 51 cases, coverage was confined to employees in certain departments or occupations; for exam ple, to machine printers in textile finishing and dyeing mills, and to pressmen in a newspaper plant. More than two-thirds of these cases had length-of-service requirements of 30 days or less. Coverage in 9 cases was confined to key em ployees, usually selected upon an individual basis with an eye to the importance of the job and the service record of the individual. Plans of this variety included one which covered a small group of key production and nonproduction workers in a garment plant but excluded the bulk of the produc tion workers, and another in an ice-cream factory which covered a small selected group of employees in a number of key skilled jobs during the dull season. The proportions of workers covered were, of course, highest in the group of plans which per mitted all employees to be eligible, and lowest in the plans restricting coverage to employees in specific departments or occupations and to key 772334°— 48---------- 3 T a b l e 9.— Proportion o f wage earners covered in currently employees (table 9). Among the 101 plans where all the employees were eligible for coverage, there were 38 where every employee in the establishment was actually covered by the guarantee; in the remainder of these plans, the minor exclusions of small groups of workers and the length-of-service provisions reduced the proportion of workers actually covered, but only in a small number of cases to less than 60 percent. Among the 60 plans restricting coverage to specific departments or occupations or to key employees, generally less than 30 percent of the total number of workers in the establishment were actually covered by the guarantee. A tabulation of proportions of workers covered, showing union and nonunion establishT a b l e 10.— Proportion of wage earners covered in currently operating guaranteed wage or employment plans in Bureau of Labor Statistics survey , by representation o f covered workers Number of currently operating plans Percentage of total wage earners covered by guarantee Total Union Non union Total______________________________________ 196 130 66 Under 5 percent___________________________ 5 and under 10 percent_____________________ 10 and under 20 percent______________ ____ 20 and under 30 percent................................ . 30 and under 40 percent____________________ 40 and under 50 percent____________________ 50 and under 60 percent------------------------------60 and under 70 percent________________ _ 70 and under 80 percent__________________ _ 80 and under 90 percent--------- -------- --------90 and under 100 percent---------------------------100 percent__________ ____ __________ _____ Data not available------------------ ------------------- 12 13 7 12 10 10 11 17 15 14 9 38 28 11 12 5 10 5 7 7 14 10 9 5 17 18 1 1 2 2 5 3 4 3 5 5 4 21 10 12 GUARANTEED WAGE PLANS IN THE UNITED STATES merits separately, indicates a great range in both groups, but with more restricted coverage in the case of the plans in unionized establishments (table 10). This reflects to some extent the influence of the “ basic crew” contracts, and the fact that the plans were limited to those parts of the establish ments over which the unions had jurisdiction. The proportion of coverage was highest in plans in small employing units, as shown in table 11. Thus, 34 of the 38 plans in which 100-percent cov erage was reported were in establishments em ploying fewer than 50 workers. There were, how ever, a small number of plans covering 70 percent or more of the total work force in establishments T a b l e 11.— Proportion o f wage earners covered in currently operating guaranteed wage or employment plans included in Bureau o f Labor Statistics survey, by total number of wage earners Number of currently operating plans by total number of wage earners Percentage of total wage earners covered by guarantee Total Total........................ ............. ............................... ............ Under 5 percent__ _________________________________ 5 and under 10 percent_____________________________ 10 and under 20 percent____________________________ 20 and under 30 percent____________________________ 30 and under 40 percent____________________________ 40 and under 50 percent____________________________ 50 and under 60 percent____________________________ 60 and under 70 percent__________ ________________ 70 and under 80 percent __ __ _______________ 80 and under 90 percent__________ _______________ 90 and under 100 p ercen t...______________________ 100 percent________ _______________________________ Data not available... _________________ _____ _____ 196 12 13 7 12 10 10 11 17 15 14 9 38 28 Less than 25 64 29 1 1 5 1 5 4 7 9 4 2 25 T a b l e 12.— Distribution o f number o f wage earners covered by currently operating guaranteed wage or employment plans in Bureau of Labor Statistics survey Number of currently operating plans Total_______ ______________________________________________ i 196 Less than 5__ _______ ________________________________ . _. 5 to 9______________________________________________________ 10 to 24___________________________________________________ 25 to 49____________________________________________________ 50 to 99 _________________________________________________ 100 to 499 ________________________________________________ 500 to 999 ___ ________________________________________ 1,000 to 4,999 ______________________ _________________ 5,000 and over. ________________ ______ ____________ ____ Covered employment not available______________________ 33 32 41 30 13 218 27 3 13 1 28 1 A guaranteed wage or employment plan embodied in a master contract between a trade association and a union is counted as a single plan, and is classified according to the total number of wage earners in all of the covered establishments. There are 10 such cases. 2 Includes 2 master contract plans. 3 Includes 4 master contract plans. 75-99 13 1 2 2 1 3 1 1 3 1 4 4 9 1 3 2 1 1 1 Total employ ment not avail able 1,000 and over 100-249 250-499 500-749 750-999 5 23 14 3 3 18 2 4 3 2 6 1 1 1 1 4 2 1 1 3 1 or employing units with several hundred or more than one thousand workers. In absolute figures respecting numbers of covered wage earners, 149 of the 188 plans for which information was avail able covered less than 100 wage earners, 18 cov ered from 100 to 500 wage earners, 7 covered from 500 to 1,000, and 14, or 7 percent of the total num ber, covered 1,000 or more workers (table 12). Number of wage earners covered 50-74 25-49 5 1 1 1 1 1 2 2 1 1 1 . 1 1 1 2 1 1 1 1 ' 1 24 2 3 1 1 1 24r For purposes of comparative analysis of the duration of the guarantees, the Bureau has classi fied the plans in accordance with the amount of wages or employment guaranteed or advanced, in terms of weeks of full-time or part-time hours or pay. In the few cases in which the duration of the guarantee was adjusted according to a sliding scale on the basis of such factors as wage rate or length of service, the maximum duration of the guarantee was used for the tabulation. The num ber of weeks of employment guaranteed was cho sen as the means of expressing the common denominator because guarantees in terms of num ber of weeks of employment per year occurred most frequently. The actual wording of the guar antees reflected a wide range of plan and contract terminology. The variety of language used is il lustrated by a listing (on p. 14) of extracts from the texts of plans which guarantee substantially the same employment— a full year, at full-time wages. Almost two-thirds of the plans (128 out of 196) guaranteed employment for a full year at full time hours or pay (table 13). Most of these ar rangements were guarantees of 52 full weeks of employment, or pay in the absence of employment; 13 EXTENT AND NATURE OF GUARANTEE T T a b l e 14.— Duration of guarantee in currently operating 13.— Duration of guarantee in currently operating guaranteed wage or employment plans covered by Bureau of Labor Statistics survey, by representation of covered workers able guaranteed wage or employment plans covered by Bureau of Labor Statistics survey , by number of workers covered by guarantee Number of currently operating plans Total number. of workers covered in currently operating plans Duration of guarantee Union Total Duration of guarantee Non union Total ______ ________________________________ 196 130 66 Full year (52 weeks, 2,080 hours, etc.)________ At full-time hours or pay______ _________ At less than full-time hours or pay_______ 50 weeks’ full-time hours or pay ____________ 48 weeks’ full-time hours or pay______________ 47 weeks’ full-time hours or pay ___________ -46 weeks’ full-time hours or pay ___________ 40-45 weeks’ full-time horn's or pay____________ 38-39 weeks’ full-time hours or pay____________ 13-37 weeks____________________ ______________ At full-time hours or pay____ ____________ . At less than full-time hours or pay________ 140 128 12 9 7 4 8 10 11 7 3 4 80 69 11 9 5 4 8 9 10 5 2 3 60 59 1 2 1 1 2 1 1 Total_______________________________ _________ _________ 161,229 Full year (52 weeks, 2,080 hours, etc.) _____________________ At full-time hours or pay _____________________ _____ At less than full-time hours or pay____________________ 50 weeks’ full-time hours or pay___________________________ 48 weeks’ full-time hours or pay__________________________ 47 weeks’ full-time hours or pay__________________ ________ 46 weeks’ full-time hours or pay______________ ___________ 40 to 45 weeks’ full-time hours or pay_____________________ 38 to 39 weeks’ full-time hours or pay_____________________ 13 to 37 weeks ___________________________________________ At full-time hours or pay_____________________________ At less than full-time hours or pay____________________ 2 51,250 2 41,529 9,721 1,465 3 4,176 41 20 745 4 138 3,394 1,206 2,188 1 Data not 2 Data not 2 Data not 4 Data not very few were expressed in terms of an annual wage. Eighty-five percent of the plans (166) guaranteed full-time pay for 40 weeks or more. The total of 61,000 workers covered by the 196 plans was distributed in approximately the same manner as the number of plans (table 14). Most of the guarantees were expressed in terms of employment rather than in terms of wages. The detailed studies made by the Bureau in 62 cases indicated that this manner of expression arose largely from the employer’s confidence that he could provide the stated amount of work, and where the worker failed to make himself available for work, no pay was generally given. available for 8 plans. available for 5 plans. available for 2 plans. available for 1 plan. Thus far, it has appeared that a major propor tion of the guarantees provided full-time pay for an entire year, and that a large group provided coverage for all employees upon hiring or after a relatively short period of time. A cross-tabula tion of these two characteristics provides a method of determining the extent to which full-year guar antees and guarantees to all employees after a short period of time coincided. Table 15 shows the multiplicity of combinations of guarantee and eligibility provisions that were embodied in the T a b l e 15.— Duration o f guarantee in currently operating guaranteed wage or employment plans covered by Bureau o f Labor Statistics survey , by eligibility requirements Number of currently operating plans 5 4 35 51 36 9 2 3 5 4 1 3 3 4 4 32 27 5 2 29 25 4 3 3 19 16 3 1 3 6 5 1 1 1 1 3 3 1 5 7 4 1 3 4 7 2 1 A t le s s th a n f u l l-t i m e h o u r s or p a y 1 1 2 1 2 1 1 1 1 1 1 1 1 1 1 9 9 9 1 1 Coverage confined employees Employees in regu lar jobs only 7 8 7 1 1 Unknown Upon selection by employer 9 6 6 Upon hiring or after 30 days or less 9 4 4 Total Upon service of 3 months or more Coverage includes or ployees in regular 4 40 39 1 3 1 4 8 3 4 Upon selection by employer Upon service of IK to 5 years 63 70 67 3 4 4 4 8 4 4 3 2 Upon service of 5 years or more 1 Upon service of 1 year 101 140 128 12 9 7 4 8 10 11 7 3 4 Upon service of 6 months 196 Duration of guarantee Upon service of 3 months Total Total_____________________________ _______ Full year (52 weeks, 2,080 hours, e tc .)____ At full-time hours or pay____________ __ At less than full-time hours or pay ____ 50 weeks’ full-time hours or pay _______ 48 weeks’ full-time hours or pay __ ______ 47 weeks’ full-time hours or pay________ _ __ 46 weeks’ full-time hours or pay _ _ _ __ 40-45 weeks’ full-time hours or pay __ ____ 38-39 weeks’ full-time hours or pay _____ _ 13-37 w e e k s _ __ _______ At full-time hours or pay Upon hiring or after 30 days or less Grand total i Coverage open only to employees in specific departments or occupations Coverage open to all employees 14 GUARANTEED WAGE PLANS IN THE UNITED STATES T a b l e 16.— Distribution o f 56 currently operating plans guaranteeing full-time employment or wages for 52 weeks a year to all workers upon hiring or upon service of 1 year or less, by number of covered workers Number of plans Number of wage earners covered Upon hir ing or after Upon serv of1 year 30 days or iceor less less Total_____ 39 56 Less than 5....... ....................... ................ ....................... 5 to 9............................................ ..................................... 10 to 24............................................. .............. ................ . 25 to 49............................................................................. 50 to 99_______________ _____________ ______________ 100 to 499................................................. ......................... 500 to 999._______ _________________________________ 1,000 to 4,999______________________ ________________ 5,000 and over. . ........ ........ .............. .......... Covered employment not available........... ................ 5 9 9 10 1 3 5 12 10 15 3 5 1 3 1 1 2 plans. For example, of the group of 128 plans which guaranteed full-time employment for an entire year, 39 afforded coverage to all employees upon hiring or within 30 days thereafter. The remainder had additional length-of-serviee re quirements, or restricted coverage to employees in “ regular” jobs, to employees in specific depart ments or occupations, or to key employees. L ISTIN G OF G U ARAN TEED WAGE OR EM PLOY M EN T PLAN CLAUSES, ILLU STR A TIN G TH E V A R IE T Y OF METHODS EM PLO YE D TO E X PRESS GUARAN TEES OF FU LL-TIM E ANNUAL E M PL O Y M E N T 1 1. The employer agrees to continuously employ_________ union persons * * *. These shall constitute the basic staff and shall not be subject to lay-offs at any time. 2. The tenure of employment of permanent employees shall be 52 weeks in each year without any lay-off whatsoever. 3. For each full year of service after the first year, 2 months of indemnity in case of complete lack-ofwork lay-off, or 346% hours of straight-time pay in case of partial lack-of-work lay-off, will be added to the indemnity or guarantee until, after 6 full years of service, a maximum of 1 year or 2,080 hours' indemnity or guarantee is provided. 4. All employees shall receive 12 months of uninterrupted employment. 5. All steady employees who come under the scope of this agreement shall be guaranteed steady employment throughout the life of this contract. 6. The basic gang employed by the employed hereunder shall consist of 3 mechanics, 2 helpers, and 1 car washer. Each of such men shall be employed by the employer for 2,000 hours during the period of 1 year covered by this agreement * * *. 7. All skilled employees covered by this agreement who have passed their probationary period as herein before set forth, shall be paid on the basis of 52 weeks per year. 8. * * * each of the said members of the said associ ation in the employ of the company * * * shall * * * work not more than 2,000 hours during 50 calendar weeks of the period covered by this contract. It is the intent of the parties hereto that the members of the association shall have 2 weeks' vacation with full pay. 9. Each employee * * * will be offered 2,000 hours of work during the calendar year. In addition to offering each employee 2,000 hours of work, each employee will be given paid time off at times to be designated by the employer to make this agreement conform to the 40-hour provision in the regular contract. 10. The employer guarantees to the 5 maintenance men named in the contract between the parties, dated November 1, 1941, not less than 48 hours of work, or the monetary equivalent thereof, in every week during the 52-week period which is the term of this contract. 11. It is further agreed that regular employees be em ployed 52 weeks per year. 12. Whenever the term “ steady employee" or “ steady employees" shall be used in this agreement, it shall refer to such employees of the employer who are guaranteed under this agreement 12 months' work in each year during the period of the contract. 13. A salesman may be discharged upon 2 weeks' written notice by the employer to the union * * * (slack season, however, shall not be deemed a cause or a reason for the discharge of a regular salesman). 14. Said employer agrees to employ said employee as ______ for a term of 1 year from the date hereof, at a weekly salary o f _______ T a b l e 17.— Distribution o f 56 currently operating plans guaranteeing full-time employment or wages for 52 weeks a year to all workers upon hiring or upon service o f one year or less, by industry Number of plans Industry group Upon hir ing or after Upon serv 30 days or ice of 1 year or less 39 56 Manufacturing, total..................................................... 7 Food and kindred products.................................. 3 Textile-mill products_____________________________________ Apparel and other finished products made from fabrics and similar materials......................................... Printing, publishing, and allied industries____ 3 Chemicals and allied products....... ..................... 1 14 7 32 42 9 14 13 18 Total. Nonmanufacturing, total. ____ _____ Construction—general contractors. Wholesale trade____ ______________ Retail trade........ ................................ Real estate.......................................... Communication__________ ________ Heat, light, and power____ ______ Services.____ ____________________ 2 1 1 5 1 1 4 1 2 2 1 1 5 15 EXTENT AND NATURE OF GUARANTEE T a b l e 18.— Discontinued guaranteed wage or employment T a b l e 20.— Discontinued guaranteed wage or employment plans covered in Bureau o f Labor Statistics survey, by number o f covered workers plans covered in Bureau of Labor Statistics survey, by duration of guarantee Number of wage earners covered Number of dis continued plans Total................................... ............................................................. i 151 Total, excluding 96 plans which operated under Wisconsin unemployment compensation law, 1934-35_______________ 55 Number of discon tinued plans Duration of guarantee 1151 Total Less than 5 . ............................................................................... . 5 to 9_ ................................................................ 10 to 24__........................................................... ................... 25 to 49_ ..................................................................................... . 50 to 99__......................................................................................... 100 to 499. ........................................................ _ . _ _ 500 to 999....................................................... ............. .................... 1,000 to 4,999_______ I...................................... ............................ 5,000 and over_______________ __________ ___________________ 11 2 6 6 6 13 3 2 2 Covered employment not available_______________________ UOO 1 Includes 96 Wisconsin plans for which data are not available. T a b l e 19.— Discontinued guaranteed wage or employment plans covered in Bureau of Labor Statistics survey, by eligibility requirements Eligibility requirements Total Total, excluding 96 plans that operated under the Wisconsin unemployment compensation law, 1934-35__________________ Coverage open to all employees_____________________ _________ Upon hiring or after service of 30 days or less...................... Upon service of 3 months..................... ....................................... Upon service of 6 months_____________ ___________________ Upon service of 1 year____________________ ________________ Upon service of 1^ to 5 years_____________________________ Upon service of 5 years or more___________________________ Upon selection by employer______________________________ Coverage includes only employees in “ regular” jobs___________ Coverage open only to employees in specific departments or occupations_____________________________________________ Upon hiring or after service of 30 days or less______________ Upon service of 3 months or more_________________________ Coverage confined to key employees__________________________ Number of discon tinued plans Total, excluding 96 plans that operated under the Wisconsin unemployment compensation law, 1934-35__________________ 55 8 Total, excluding 96 plans that operated under Wisconsin State unemployment compensation law, 1934-35 __ _________ __ 3 11 1 4 1 Includes the 96 Wisconsin plans, which are not shown in the body of the table. Further examination of the group of cases which provided the most substantial guarantees to the broadest groups of workers shows that they were for the most part cases that involved small or me dium-sized groups of workers (table 16) and that more than half of them occurred in wholesale and retail trade (table 17). The proportion of union ized establishments was substantially less in this group than in the entire group of 196 plans. 2 7 i 151 Total 12 1 3 9 Number of discon tinued plans 2 2 0 U03 1102 plans covered in Bureau of Labor Statistics survey, by industry group 55 3 2 3 0 0 T a b l e 21. — Discontinued guaranteed wage or employment Industry group 5 8 1 Includes 96 Wisconsin plans operating from 1934 to 1935 under State unem ployment compensation law which set a minimum standard of 42 weeks’ guarantee (at 36 hours per week in 1934 and % of full-time hours in 1935). U51 36 16 31 23 Full year (52 weeks, 2,080 hours, etc.)_________________________ At full-time hours or pay_________________________________ At less than full-time hours or pay_________ ______________ 50 weeks’ full-time hours or pay___________ _____ ____________ 48 weeks’ full-time hours or p ay .._____ __________ .____________ 47 weeks’ full-time hours or pay___________ _______ ___________ 46 weeks’ full-time hours or pay_______________________________ 40 to 45 weeks________________________________________________ At full-time hours or pay_________________________________ At less than full-time hours or pay________________________ 38 to 39 weeks’ full-time hours or pay_________________________ 13 to 37 weeks________________________________________________ At full-time hours or pay_________________________________ At less than full-time hours or pay________________________ ___ ___________________ ________ ____________________ 44 12 3 Nonmanufacturing, total _ __________ _________ Bituminous and other soft coal mining________ _ _________ Nonmetal lie mining and quarrying ______ ___ Construction—special trade contractors (subcontractors). . . Wholesale trade___________ ______________ _____ _ __ __ Retail trade __________ - __ ___________________ ________ Highway freight transportation____________ _ _ _________ Water transportation ___ ___________________ - _ _ __ Heat, light, and power__________________ _______ _ ____ 11 1 1 1 1 4 1 1 1 4 1 6 3 1 2 1 2 2 3 1 3 1 Total includes 96 plans in Wisconsin for which industry data are avail able only on the basis of broad industry groupings, and by establishments, rather than plans, as follows: N u m ber o f establishments B. Discontinued Plans Total............................................. A total of 151 plans are known to have operated in the United States and to have been discontinued prior to 1946, including the 96 which were in ex istence for slightly more than 1 year under the Manufacturing. ---------Transportation, communication, and public utilities___________ Wholesale and retail trade_____________________________________ Finance, insurance, and real estate-------------------------------Miscellaneous services_________________________________________ Educational, religious, medical, etc., services----------------------------Municipal--------------------- 55 Manufacturing, total _________ ________ _ ____ __ Food and kindred products_________ _____________ Textile-mill products Apparel and other finished products made from fabrics and similar materials _ _ __ ________________________________ Furniture and finished lumber products____________ __ __ ______________________ Paper and allied products Chemical and allied products_________________ ____ _______ __________________________ _______ Rubber products Stone, clay, and glass products___________________________ Iron and steel and their products _______ ______ _______ Nonferrous metals and their products ____ __ _____ ____ _____ _________ ______ Machinery (except electrical) __ Electrical machinery ______________ ____________________ Automobiles and automobile equipment _________________ Miscellaneous manufacturing industries___________________ Industry group 176 21 37 57 25 23 12 1 16 GUARANTEED WAGE PLANS IN THE UNITED STATES provisions of the Wisconsin unemployment com pensation law during 1934 and 1935. The discon tinued plans involved total employment of nearly 180,000, of which approximately 3 percent in volved the 96 Wisconsin plans and more than 85 percent the plan of 1 large manufacturing concern. The reasons for their discontinuance have already been discussed in an earlier section. The plans that have been discontinued exhibit no characteristics essentially different from those of the plans which are still operating. Informa tion concerning the number of wage earners cov ered under the plans (table 18), the coverage provisions and eligibility requirements of the plans (table 19), and the duration of the guaran tees provided (table 20), show the same general picture that has already been presented with re spect to the plans that are still in operation. As far as industry distribution is concerned, the dis continued plans show a substantial scattering among virtually all of the same industries in which guaranteed wage or employment plans continue to exist (table 21). Aside from the 96 Wisconsin plans, it appears that plans in retail and wholesale trade were discontinued to a lesser extent than in other industries. IV. Experience With Guarantee Plans in 62 Selected Cases The guaranteed wage and employment plans that have been introduced in the United States do not reflect a uniform pattern of motivation, operating problems, or results. They reflect the experience of a group of employers and unions which has attempted to increase the security of the worker in a variety of situations. In order to present information on the actual experience of labor and management operating under guaran teed wage or employment plans, the Bureau of Labor Statistics studied in considerable detail the operations of 62 individual plans— approximately one-fifth of the group of 347 discussed in part III of this report. The 62 plans selected for special study were chosen to represent as nearly as possible the variety of individual situations found in the entire group of cases. Such factors as type of plan, size of establishment, unionization, industry, and geo graphical location were taken into account in the selection of the cases. Because of the small num ber of plans studied in detail, choice of repre sentative cases rather than a balanced sample was the goal. Where there was a choice of alternative plans the better-known plan was generally selected. The group is also believed to include the establish ments in which the greatest degree of employment regularization was undertaken. The 62 cases in cluded 47 plans still in operation and 15 that had been discontinued; 42 in which the employees were represented by unions at the time the plans were introduced and 20 in which they were not. Included were guarantees providing a full year's work, guarantees limited to less than a full year's work, and four wage advance plans. The group included contractual guarantees as well as some plans which were in actuality little more than written or oral statements of the employer's intention to guarantee a certain amount of employment. The 62 cases were studied in detail through plant visits made by field representatives of the Bureau. Management officials, union officials, and individual employees were interviewed per sonally on the basis of detailed schedules devel oped specifically for this purpose. Generally, throughout part IV of this report the cases are discussed as a group without regard to union status, kind of guarantee, or active status of the plan, where these characteristics do not affect the topic under discussion. The cases have been examined, however, to determine where these characteristics and others do affect the analysis, and specific discussion of these facts has been introduced at relevant points. A. Circumstances of Introduction Appraisal of the achievements of the plans can not be made without a brief background picture of the variety of situations into which plans have been introduced; the great range of motives— many unrelated to the issues raised in current dis cussions about a “ guaranteed annual wage"; the kinds of specific labor relations and business problems which the plans were designed to solve; the immediate occasions for introducing the plans; and the effects of their introduction upon existing wages and working conditions. 1 . Pre-Plan Em ploym ent Situations It has already been indicated in part III of this report that guaranteed wage or employment plans were introduced in a variety of industries, both manufacturing and nonmanufacturing, and by large as well as small employers. Whether com panies that have guaranteed employment or wages had unusual conditions of stable employ ment which made it possible for them to introduce guarantees is an important question to explore at the outset. Stability of employment is, of course, difficult to define. It can be measured by the absolute degree of fluctuations in employment or man hours; by the regularity of employment variations; 17 18 GUARANTEED WAGE PLANS IN THE UNITED STATES by the numbers and the kinds of workers affected by employment fluctuations; by a comparison of employment fluctuations in one company with fluctuations in others in the same business; and by comparison of present fluctuations in employ ment or man-hours with past experience, present prospects, or long-run possibilities. It has not been possible within the scope of this study to measure the situation in the 62 cases from all of these points of view. Information was generally available chiefly with regard to the degree and character of present and past employment fluc tuations. Some fluctuation in both employment and man hours was anticipated— either from month to month or from year to year— in each of the 62 cases prior to the initiation of a wage or employ ment guarantee. No combined measure of these fluctuations can be satisfactorily compiled, be cause of the wide range of different individual situations. The most important conclusion to be drawn from the employment and man-hours data collected by the Bureau of Labor Statistics is that there is a great variety in the kinds and degree of fluctuation among firms that have had guaranteed wage or employment plans— probably as great a variety as exists in all American industry. It was impossible to determine with precision whether employment fluctuations in the firms under study were normally smaller or greater than in other firms engaged in similar work. In general, comparisons with broad industry averages of employment variation were not used because it was believed that they would yield limited results; and it was difficult to make specific comparisons with exactly comparable groups of individual firms. Nothing in the general business situations of the firms under study or in their technical methods of operation was reported, however, which set them off as a group from other firms doing similar work. Company and union officials stated almost uniformly that there was little or no difference between the situations of firms under study and those in similar business activity. Information obtained on employment and business regularization activities which the companies had undertaken did not point to the existence of special situations or exclusive processes that might have led to greater employment stability or served to give competitive advantage. An overwhelming majority of the guarantees, in fact, were introduced by firms which faced employ ment stabilization problems of substantially the same kind that are faced by employers generally. A more specific idea of the kinds of employment fluctuations involved in the cases studied can be best obtained by a review of individual situations, cited in the following paragraphs. Monthly Employment Variations. Month-tomonth fluctuation in employment and man-hours of work within the year varied substantially from firm to firm. Among the companies with the smallest variations were three electric light and power concerns. Their month-to-month employ ment varied hardly at all, except as affected by normal turn-over. Despite substantial fluctua tions in power production, these companies reported the continuing necessity for crews of uniform size to operate productive equipment. Occasional variations in the monthly employment level, although not on a recurrent seasonal basis, were caused by changes in the size of the utilities’ construction programs. In contrast, an ice cream company studied produced about 80 percent of its volume for summertime road sales, and, prior to the introduction of the plan, its operations, which called for peak employment of about 85 workers during the summer months, required less than 15 workers in the months from November to March. A Great Lakes carrier shut down com pletely when freezing weather set in and seagoing personnel had no opportunity for winter work on company operations ashore. Between these extremes, the firms ran the gamut of month-to-month fluctuations in em ployment, as the following examples illustrate: In the Crocker-McElwain Co. and the Chemical Paper Manufacturing Co., af filiated New England paper manufacturers, employment on direct production operations was remarkably stable from month-to-month between 1921 and 1940, because of the neces sity for a crew of constant size to operate productive equipment, regardless of volume produced. Temporary instability of em ployment was caused by annual water failures or freezes that resulted in shut downs. Employment in the auxiliary rag and finishing departments was much less stable than employment in direct productive operations. EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES Employment in the Barlow & Seelig Manu facturing Co., a midwestern washing machine firm, prior to the introduction of a plan varied annually from a spring peak which rose to 17 percent above the annual average to a year-end slump 6 percent below. Month-to-month employment variations in the small plant of an eastern manufacturer of men’s and boys’ clothing showed a sub stantial year-to-year difference in the amount of seasonal fluctuations: in 1940, from a low of 47 percent of the annual average to a high of 125 percent of the annual average; in 1937, from a low of 20 percent to a high of 210 percent. Employment in an eastern chain of readyto-wear apparel stores showed the seasonal fluctuation typical of this industry: Easter and Christmas peaks 6 and 18 percent, respectively, above the annual average and slumps to about 85 percent of the annual average during the months of February and August. The employment pattern in two midwestern cereal and feed companies followed month-to-month fluctuations in shipments of cereals to brokers and wholesalers, declin ing during spring and summer months and rising to a peak in the fall of each year. Prior to employment stabilization efforts and the introduction of a guarantee, em ployment in the Proctor & Gamble Co. was highly unstable. Activity ranged from threeshift, round-the-clock operation to almost complete standstill. Erratic receipts of livestock affected pro duction at Geo. A. Hormel & Co. and caused wide month-to-month man-hour fluctuations, which sometimes ranged from 24 percent above the annual average to 19 percent below average in the years immediately prior to introduction of the plan. Examination of the specific month-to-month employment stabilization situations faced by the firms at the time guarantee plans were introduced reveals a wide variety of business management problems. 772334°— 48--------4 19 Seasonal weather factors were involved in a number of the month-to-month employment varia tions: a sand and gravel operation, a road con struction firm, and a Great Lakes transportation company ceased or virtually ceased operations when freezing weather set in. The operations of a number of companies depended in whole or in part on seasonal farm activity: a canning company relied heavily on the annual tomato crop for its production of soups and catsups; and a chemical company’s main product— fertilizer— was bought largely during spring and fall planting seasons. Agrarian operations also affected a meat packer whose production activity was dependent on farm shipments of cattle and hogs, as well as a spice manufacturer whose products sold best during the home canning and pickling season. The indirect effects of seasonal weather changes were the most frequently reported causes of em ployment instability. Increased spring and sum mer demand for tires, ice cream, insecticides, beer, baby carriages, car seats and swings, and construc tion and maintenance materials were reported to stand in the way of stabilized employment in firms manufacturing these products. Activity expanded during spring and summer months in a fur storage and repair firm. Another large group of firms experienced their greatest activity during the fall and winter months: a battery manufacturer, oats and cereal companies whose hot cereals sold largely in winter and were subject to deterioration in summer, and a southern railroad whose heaviest traffic resulted from winter tourist trade and fruit and fertilizer freight. Style changes reflecting seasonal weather changes affected the operations of two women’s apparel manufacturers who produced their specialties in advance of seasonal sales. Holiday season peaks in consumer purchasing also affected employment fluctuations: a retail apparel chain’s employment increased sharply at the Easter and Christmas seasons; a wholesale jewelry firm’s employment followed the same pattern, and frequent style changes made it impracticable for the firm to package extensively for stock during slack months of the year; mail order firms, a variety store, a men’s clothing store, retail shoe chains, and a department store were similarly affected. Increased consumer purchas ing during holiday seasons was also the chief cause of employment instability in a hosiery, a liquor, 20 GUARANTEED WAGE PLANS IN THE UNITED STATES and two silverware manufacturing firms, as well as in a daily newspaper whose advertising volume fluctuated in direct relation to retail sales activity in the community. Purchasing policies of wholesale and distribu tion firms caused varying amounts of employment fluctuation. The most noted situation of this kind was the case of the Procter & Gamble Co., whose officials came to the conclusion, after lengthy investigation, that ultimate consumer demand for the company’s product was relatively stable from month to month, and that fluctuations in demand for the product at the factory resulted from fluctu ations in wholesale prices and from the purchasing policies of distributors. In a number of other companies, including a wholesale grocery concern and the two midwestern cereal and feed companies, reduction of annual inventories was also a factor causing slack periods. In the latter two compa nies, in addition, wholesalers’ policy of keeping inventories at an absolute minimum during sum mer months, when cereals were subject to great est spoilage, caused the plants’ major annual slack periods. In two New England paper companies, a general drop in wholesalers’ activity during the summer months led to a slight drop in production, although not to any major fluctuation in employ ment, because of the necessity for maintaining crews of constant size to produce at any volume. Employment variations in manufacturing or wholesaling establishments in several cases paral leled the seasonal patterns of the firms to which their products were sold. A West Coast paper converter produced largely for the food products industry, and production operations followed the seasonal patterns of food manufacture. A button and buckle wholesaler’s employment pattern took its course from production fluctuations in the women’s cloak and suit industry. Textile dyeing and finishing operations followed textile and ap parel style changes; production and employment in the manufacture of construction materials fol lowed the seasonal pattern of construction activity; and battery manufacturing operations varied with model changes in the automobile industry. Year-to-Year Employment Variations. It has al ready been noted in part III of this report3 that very few plans were found in the heavy or basic manufacturing industries that are subject to 8 See page 9. wide cyclical fluctuations. Information directly relating to the effects of the 1930-34 and 1937-38 business depressions on employment and man hours was available in the 8 cases in which the plans originated before 1931 and were in existence during the depression of the early 1930’s, and in the 26 cases in which the plans operated during the recession of 1937-38. In these cases, the effects of business depression may have been mitigated by the existence of a guarantee. It is not possible, therefore, to trace the situation in each company back to a pre-plan period which also shows the effect of depression upon year-to-year operations. Both the statistical material available and the reports of union and management officials, how ever, attest to the positive effects of the depression of the early 1930’s on business and employment in most instances. These effects can be appraised best by citation of specific situations: In the Crocker-McElwain Co., a New Eng land paper manufacturer, depression employ ment reached a low point during the year 1932— during the existence of the plan— when average annual employment dropped to 78 percent of the 1929 level, and operating days for the year dropped to 38 percent of the 1929 level. In the Detroit & Cleveland Navigation Co., freight tonnage declined by 33 percent be tween 1929 and 1932, and the number of passengers carried dropped by 67 percent. No adequate employment records over a series of years were available from a number of small retail and wholesale establishments which introduced guarantees covering basic crews, but volume of sales and employment was directly related to volume of consumer purchasing power available to buy their mer chandise— furs, costume jewelry, and women’s and men’s apparel. Sensitivity to the business recession of 1937-38 appears to have been substantially less prevalent than the effect of the earlier depression, as was true in the case of many firms which did not intro duce guarantees. Most of the firms on which in formation is available reported no decline of consequence in business operations or employ ment during the years 1937 and 1938. EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES Relative constancy of year-to-year employment, or a sizable, and frequently steady, increase in employment characterized most of the firms during the 10-year period preceding 1946. In some cases increases in employment were the result of post-depression recovery; in several cases employment increases since 1940 were attributable to the effects of the war. Over and above these causes, however, a number of the companies demonstrated an expansion in activity and em ployment resulting from a long-range increase in demand or from aggressive business management. Only a small number of firms showed a downward trend in total employment, resulting in large part from the effects of the war. 2. Stable Em ploym ent for Part of the Work Force Despite the existence of varying degrees of employment instability, as described above, almost all of the 62 firms were able to give a substantial degree of stable employment to certain groups of their employees. Like most employers, they found it necessary to retain a basic force at all times. This core of stable employment varied from an occupational group or a handful of key employees in some cases to virtually the entire work force in others. In a number of cases, the size of the stable core had been enlarged substantially by employ ment stabilization efforts undertaken during the years preceding the introduction of the guarantee. The scope of this study did not permit the elab orate analysis of pay rolls that would have been necessary to determine the size of the core of stable employment in each establishment. The character of the situation is, however, readily apparent from several typical cases: Employees of the three utility companies surveyed who were engaged in regular power production operations and in customer servic ing had much greater stability of employment than those engaged in the construction of new power lines or in sales of electrical equipment. Key employees in an East Coast garment plant— cutters, foremen, and sewing machine operators with long service records— had much more stable employment than did op erators hired during seasonal peaks. Labor and management, in several cases involving wholesale and retail distribution 21 establishments, reached agreement upon the number of employees whom they regarded as constituting basic crews, normally required by the firms to perform regular business opera tions. Basic-crew size in these cases varied from 35 percent to 90 percent of total em ployment. Prior to the institution of a guarantee, few of the employees of the Columbia Conserve Co. had year-round employment. After the institution of the plan, the employee-owners of the company, numbering about 100 at the peak of the plan’s coverage, had much more stable employment than the temporary work ers who continued to represent up to 60 per cent of total employment during canning seasons. Temporary workers hired for peak season operations in a number of other companies— a road construction firm, a sand and gravel operation, and cereal and food companies— obviously had less stable employment than regular workers. In the case of a large cereal company, management reported that the ex istence of a sizable “ cushion” of temporary help was one of the factors making a guarantee to the rest of its work force practicable. In every case, of course, month-to-month em ployment stability was greatest for employees with high seniority status. The majority of guaranteed wage or employ ment plans in the United States (as has already been pointed out in part III) limit coverage of employees or the proportion of annual wages guaranteed. It is important therefore, to compare the terms of the guarantees with the extent to which stable employment was reasonably to be expected by at least part of each company’s work force without a guarantee. Such comparison can be made only roughly, of course, and must be based in part on employment data and in part on the judgments of company and union officials as to the intent and significance of the guarantees at the time of their introduction. Analysis of this type indicates that in some cases the guarantees can be said to have assured more, in some cases equivalent amounts, and in some cases less stable employment or income than the workers possessed without guaranteed wages or employment. 22 GUARANTEED WAGE PLANS IN THE UNITED STATES Greater employment or income stability than had existed in the past was expected in cases where the employer consciously decided to keep skilled workers during slack seasons, where the plans were designed as unemployment compensation devices and wage earners were paid for lay-off periods, and where, as in the case of the Hormel Co. and the Seaboard Air-Line Kailway, and a master contract covering Cleveland fur repair workers, the plan inaugurated a new stage in em ployment stabilization efforts as well as a guaran tee. In a small number of cases, the plans clearly guaranteed less employment than was already provided without a guarantee. A New England utility company, for example, guaranteed 2,000 hours of employment under Section 7 (b) (2) of the Fair Labor Standards Act, which was less than total annual working hours had been in the past. In other cases, guarantees covering in dividual groups of skilled workers were introduced, no consideration being given to the possibility of covering others— even those with the longest ser vice records— whose employment opportunities were equally stable. The majority of the guarantees were not framed to go beyond the degree of employment stability that management and labor already believed to exist in the establishment, or which had been achieved after a program of employment stabiliza tion. Employers, in most of the cases, believed that they were taking little or no financial risk in instituting the plans. Their attitude in this respect may in some cases have been influenced by the fact that their plans were largely introduced during periods of rising business activity, when their sights were fixed upon an optimistic future rather than upon past periods when the same guarantees might have involved greater risks. Labor unions did not as a rule press employers into assuming heavy obligations, and were them selves, in many cases, seeking security for only small groups of workers. How far the guarantees could have gone beyond what was actually given in amount and coverage without going outside the bounds of existing stable employment was in most cases a matter of conjecture that could be treated only by extended individual case analysis. 3. Previous Efforts to Stabilize Employment In approximately one-third of the cases the firms reported attempts to minimize or eliminate employment fluctuations prior to the adoption of their guarantee plans. In the remainder of the cases, the employers had concluded that their employment problems were beyond their own control or had been solved as far as was feasible, or that they could work out only limited plans within the existing framework of employment fluctuations. Even where a program of employment regu larization or stabilization had been undertaken prior to the introduction of a guarantee, it was usually done with no specific intention of laying the ground work for a guarantee. Such was the case, for example, in one of the utilities, which had for years been studying its operations with a view to the elimination of fluctuations within the year. Much of its program centered around the regular replacement of equipment, an activity previously done almost entirely on an emergency basis and resulting in somewhat erratic fluctuations in man-hours and employment. A rubber com pany tried to lift low winter demand for tires by a program of consumer education. In these and other cases like them, employment stabilization programs had generally been part of company policy for years, undertaken as a matter of good business administration rather than for the specific purpose of laying a foundation for an employment or wage policy. This planning, nevertheless, had the effect of increasing the number of workers to whom stable employment was available and who would eventually be covered under the guarantee. A small number of companies consciously undertook to stabilize employment with a fairly concrete idea in the minds of management officials that they were laying a foundation for some kind of guarantee plan. This group consisted largely of the companies most famous for their plans, which on the whole, guaranteed substantially more, either as to length of employment or number of workers covered, than most of the other and less well-known plans. As was to be expected, employment regulariza tion programs of some kind were reported in most of the medium-sized and larger companies studied, and were absent among most of the companies that employed less than 250 workers. Among the establishments having guarantee plans cover ing more than 500 workers, some degree of pre plan stabilization or preparation was reported in all but two cases— the Seaboard Air Line Railway EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES Co. and the ffm . J. Wrigley, Jr., Co. In the case of the Seaboard Air Line Railway the in auguration of the guarantee ushered in an im portant employment regularization program, with out which it would have been impossible to effect uate the guarantee; in the case of the Wrigley Co. production was considered to be stable, and the company’s inauguration of an “ income assurance” plan in 1934 was specifically designed as an unemployment compensation measure. Since most of the stabilization measures under taken were part of general company program, not specifically related to the introduction of a guarantee, they were outside the scope of collective bargaining activity. Unions or employees were not initially informed of regularization actions taken by management. In several instances, management preferred not to raise the question of a possible guarantee until the results of em ployment regularization were clear or until management had formulated the exact kind of guarantee it planned to introduce. In a few other instances, the most noted example of which was the Nunn-Bush Co., management officials followed a deliberate policy of discussing their employment stabilization problems and their hopes for the introduction of a guarantee with employees or union representatives. They did this as a matter of good labor relations policy, to draw out em ployee ideas, or to develop cooperative labormanagement efforts directed at increasing and leveling out production. Even in such cases, however, virtually all of the actual employment stabilization planning was done by management. The cases in which the guarantees were pre ceded by employment regularization were, with two exceptions, cases in which management later bore the responsibility for initiating the plan. Little pre-plan employment stabilization was reported in the cases in which union action initiated the idea of a guarantee. Most of the unioninitiated plans were in small establishments, where the opportunity of an individual employer to regularize was extremely limited, and where the achievement of uniform working conditions, in cluding a guarantee, under a master labor agree ment was in itself a stabilization measure in the industry. The specific stabilization measures taken, whether or not they were designed to lay the 23 foundation for a guarantee, cover a wide variety of business actions in the fields of production and distribution. Some, like production for stock, deferring of maintenance activity until slack periods, and control of distribution channels, are frequently cited in the literature on manage ment regularization. All were to some degree hand-tailored to meet the needs of individual cir cumstances. A picture of these activities can be given best through a series of individual descrip tions: A Minnesota manufacturer of window and door frames had for years, prior to the intro duction of a wage advance plan in 1939, spread production of windows and doors throughbut the year, primarily by the use of long-term building industry forecasts and production of standard items for stock during the winter months when demand was low. Much of the production for stock involved the manufacture of unassembled parts, a procedure that min imized the amount of capital tied up in inventory. Improvements and maintenance repair work had regularly been timed to coin cide with the winter production slump. Industry forecasts were also used by Geo. A. Hormel & Co., meat packers of Austin, Minn., in stabilization studies which were conducted for 4 years prior to the inaugura tion of their guarantee plan. Week-to-week receipts of livestock, which determined the level of plant operations, were found to be unpredictable, and little actual regulariza tion of employment resulted prior to insti tution of the guarantee. Officials found, however, that it was possible to forecast total annual receipts with a high degree of accuracy, by the use of long-range crop, weather, and market reports. It was, there fore, determined to base a worker’s annual wages on his estimated output, such wages to be received in regular weekly payments while his working hours continued to fluctuate. Employment practice prior to 1932 at McCormick & Co., Baltimore, Md., manu facturers of spices and food specialties, in volved three annual seasonal lay-off periods. 24 GUARANTEED WAGE PLANS IN THE UNITED STATES Beginning in that year, and continuing until 1936 when its plan of assuring 48 weeks of work a year was inaugurated, the company undertook a program of employment regu larization which is reported to have eliminated all three slack periods. The specific stabiliza tion steps included {a) analysis of seasonal sales periods, and persuasion of customers, wherever possible, to level out purchasing peaks; (b) improvement of sales forecasts, and planning of production in accordance with these forecasts; (c) establishment of a floating crew of workers who could be readily shifted from one department to another, to supple ment the work of regular departmental staffs during peak load periods; (d) flexible transfer of labor among departments resulting in special attention to training employees for a variety of jobs, and hiring on the basis of general skill level rather than for specific as signment; (e) improvement and decentraliza tion of warehouse facilities, to accommodate production for stock; (f) market research de signed to have on hand new products that could be put into production in the event of declines in demand for established lines; (g) advance agreement between company man agement and stockholders to forego profits during individual months or quarters, if necessary to keep employees on the job, rather than the discharge of employees to be sure that profit records would appear uni formly good. Employment planning at the Namm Store, a popular-price department store in Brook lyn, N. Y., began during the depression of the early 1930's. Supported largely by working men's trade, the store's sales were hard hit by the depression, and management took a series of economy steps. Whereas unplanned staffing of departmental operations, coupled with erratic hirings and lay-offs of varied size had been the store's prior practice, the atten tion of planning officials was now concentrated upon job classification, rate evaluation, and personnel budgeting. Budgeting was worked out in detail, particular attention being given to allocation of staff on the basis of past records of departmental transactions and floor space utilized. As a result of this plan ning, employment of year-round personnel was substantially stabilized, and the manage ment of the store became convinced that it could add a guarantee to its employment policies. In fact, management felt that its employment base was established soundly , enough to enable the store to continue a guarantee through another depression, with normal labor turn-over serving as a cushion of safety. The Nunn-Bush Shoe Co.'s stabilization program started with the regularization of distribution. As early as 1918, the company joined with others in the manufacturing in dustry to change existing sales policies. At that time, factory salesmen were writing orders sufficiently large to load retail cus tomers with stocks that would last throughout entire seasons, partly to prevent the purchase of competing merchandise. Under the new sales policy, customers were sold small initial orders, with prompt service on re-orders. Warehousing facilities were developed and stocks were built up to ensure prompt deliv eries. Shortly after World War I the NunnBush Shoe Co. itself entered the retail busi ness, and at the time of this study was selling about 30 percent of its production through about 100 retail outlets. Concurrently, the company developed a complex inventory con trol system, partially as an aid to successful planning of its production and inventory poli cies. Records of past sales, as well as informa tion on consumer preferences supplied by the retail outlets, have helped it to adjust total and individual model inventory levels with the aim of leveling production. By 1935, when the guarantee was introduced, the company had substantially minimized seasonal varia tions in production. Additional actions reported were the offering of special terms to out-of-season buyers in the case of companies manufacturing men's apparel, rubber products, and baby swings and carriages; block selling of a combination of women's coat and suit styles in advance of seasonal operations by a women's apparel manufacturer; development of cold cereal lines to be produced during spring and summer seasons, when production of hot cereals EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES was at a low point, by a midwestern cereal com pany. The descriptions given above are necessarily incomplete, because most firms probably did not report fully the employment stabilization activities which they regarded as a regular part of their business policies. The measures taken prior to the inauguration of the plans— even those taken to effectuate the meeting of the guarantees after the plans were put into operation— never eliminated completely the variations in employment and man-hours that existed to a greater or less degree in all of the firms under study. As has already been pointed out, most of the plans were based on management and labor acceptance of substantial variations in em ployment and mali-hours. Furthermore, in many instances there was admittedly no expectation that introduction of a guarantee plan would contribute to stabilization of income or would extend the area of stable employment opportunities. 4, Responsibility for Initiating Guarantee Three-fifths of the 62 plans studied were intro duced on management initiative; one-third were introduced as a result of union requests in collec tive bargaining, and unions and management shared responsibility for their introduction in three cases. The history of guaranteed wage and employment plans is to a considerable degree the history of the pioneering of individual men. In at least three-fifths of the cases in which manage ment was the initiator, the plan resulted from personal action by one or two individuals in the company— the owner, president, vice-president, or other important management official— who regu larly gave personal attention to employee welfare and labor relations. In most of these cases, the official bearing responsibility for introduction of the plan had a controlling ownership connection with the enterprise. Predominant management responsibility for initiation of the plans resulted in part from the fact that in about one-third of the cases, there were no unions representing the employees at the time the plans were introduced. Where unions rep resented, the employees at the plan’s inception, union initiation of the idea of a plan occurred in slightly more cases than employer initiation: unions proposed 21, employers initiated 18, joint responsibility was involved in three. Union ini 25 tiative seems to have been largely a matter of local bargaining. Policy or special attention of the international union was involved in only a limited number of cases. Union-iifitiated plans occurred for the most part in the smaller establishments, or in depart ments of medium-sized establishments where the unions sought guarantees for small groups of workers. Exceptions to this observation were a system-wide plan covering about 2,300 AFL rail way shop workers on the Seaboard Air Line Rail way and a plan covering about 500 workers, em bodied in a contract between the Int’l. Ladies’ Garment Workers’ Union and a women’s apparel manufacturer in Milwaukee, Wis. Even where the establishments were small, or the coverage limited, however, the total significance of the union-initiated plans was greater than appears, because most of them were in firms that were party to master contracts covering substantial groups of similar concerns in the same metropoli tan area. Such was the case with wholesale but ton and jewelry establishments, fur merchants, textile converters, shoe and apparel retailers, and breweries in New York City, and with fur repair establishments in Cleveland. Others were not master contracts, but were typical of similar agreements that had been achieved by the union, as in the case of contracts between maritime unions and the Detroit & Cleveland Navigation Co., which typified a group of similar plans on the Great Lakes, and contracts of the Machine Printers Beneficial Ass’n. with two textile print ing firms, typical of a larger number covering small groups of printers in textile dyeing and finishing establishments. 5. Objectives o f the Plans The purpose most frequently reported for the introduction of the plans was a desire to add to employee security or sense of security by guaran teeing regularity of employment or income. A great variety of additional considerations were cited, in many cases as important as the desire to provide security. For example, the desire gen erally to improve labor relations; to stabilize em ployee income; to use a guarantee as a device for further stabilization of employment; to keep trained employees in order to reduce turn-over and training costs; to increase worker efficiency; to 26 GUARANTEED WAGE PLANS IN THE UNITED STATES prevent reduction of productivity on the eve of slack periods; to establish a fixed employment policy at top management level that would re move control over employment from the hands of plant or departmental supervision; maintenance of a certain number of positions not subject to lay-off; reward for length of service; spreading of work among union members with the greatest seniority; forestalling of unionization; and the in troduction of a wage advance system to enable employees to avoid the red tape of the usual loan arrangements. Although the desire to avoid the overtime payment provisions of the Fair Labor Standards Act was reported to be a consideration in some cases, the total effect of inducements pro vided by legislation— unemployment compensa tion merit rating provisions and Section 7 (b) (2) of the Fair Labor Standards Act— was minor. Within individual establishments, the motives cited above appeared in a great variety of com binations too numerous to list. It is significant, however, to note that the desire to stabilize em ployee income was reported as a major considera tion in only about half of the cases studied. In cluded in this group were the wage advance plans, and a number of other plans in which the employ ers had consciously undertaken to pay skilled workers for time not worked during slack seasons in order to retain their services for periods of peak operations, and thus avoid much of the expense involved in hiring and training new workers. In the case of the Detroit & Cleveland Navigation Co., for instance, agreements were made to carry marine personnel on the pay roll during the freeze-over season on the Great Lakes— dating as far back as 1919 in the case of licensed officers. The initial agree ments of this type were proposed by the unions with the intent of stabilizing the income of their members, and management readily agreed that income stabilization would assist them in avoiding turn-over. In the case of a small roadbuilding com pany in Washington, D. C., a group of regular employees were guaranteed earnings and kept on the pay roll the year round in order to ensure presence on the job at the start of major projects in the spring. In slightly fewer than one-quarter of the 62 cases studied, the plans' initiators intended at the time the plans were undertaken (in addition to the stabilization of income, of course) to embark upon or broaden employment stabilization efforts with a view to widening the area of stable employment opportunities and laying a solid foundation for the guarantee. This was the case in the Hormel Co., for instance, whose plan was designed in large part to even out income during the year, but had as an equally important purpose the re tention on the pay roll of departmental crews of balanced composition and size, to whom work would be provided by every employ ment regularization effort that management could employ. In the case of the Seaboard Air Line Rail way, both company and union intended, at the initiation of the plan, to eliminate the variations in employment that had been caused by relatively unplanned budgeting of maintenance and repair work. In the case of the master agreement of the Cleveland Fur Workers' Union with fur repair shops, the union's intention in obtaining a 38week guarantee was to force several employ ers to level out work peaks during the year. Differences in Union and Management Objectives. In three-quarters of the cases where the initiative for the plans had come from union representatives (or about one-quarter of all the cases), employers reported an initial indifference to the guarantee. This attitude arose chiefly from management's belief that the union-proposed plans did nothing more than write existing practices into contracts, and that they could be undertaken with little or no financial risk. This was the case, for example, in basic crew contracts negotiated in New York City covering wholesale and retail establishments, and in a case involving a large automobile sales and service company whose owners, in negotia tions with the United Automobile Workers (CIO), EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES agreed to a guarantee covering automobile me chanics, although they had refused to grant the union’s full wage request. Management’s atti tude was lukewarm at best in the case of a Cleve land fur repair shop, where inauguration of the plan meant that shop activities would have to be spread more evenly throughout the year. In two other cases, however, where effectuation of the plan required further leveling of activity during the year, management took up union proposals and translated them into further stabilization activities. Where the initiative for the plan came from management in unionized establishments (which was the situation in about a third of all the cases), union and management were usually in agreement on basic objectives. These were, for the most part, cases in which the companies had wellestablished programs of employment regulariza tion. In the Hormel, Nunn-Bush, Wisconsin Public Service, and National Oats cases, for example, management and labor were in complete agreement on the basic objective of furnishing security to the workers. In each of these cases, of course, management also hoped to gain from the plan some form of contribution to productivity that would improve the general business situation of the company. In several cases, where plans were instituted through collective bargaining, management objec tives were substantially different from union objectives. Union aims were generally continuity of income, employment, and security for the workers to be covered. Management sought to avoid requested wage increases, to take advantage of the overtime exemption afforded by Section 7 (b) (2) of the Fair Labor Standards Act, to in crease productivity during slack periods, and to keep a supply of skilled workers on hand during slack periods or seasonal shut-downs. In the case of a small manufacturer of custom furniture in New York City, the company gave a 3-day-a-week guarantee, which it believed could be done with no risk whatever, for the stated purpose of prevent ing a wage increase. The union’s interest in the plan was security of income for its members. 772334°—48------5 27 The Barlow & Seelig Manufacturing Co., when it granted a minimum annual wage guarantee to employees represented by the United Steelworkers of America, was in terested largely in the overtime exemption afforded by Section 7 (b) (2) of the Fair Labor Standards Act, while the union, which had initiated the idea for the plan, was interested in security of income. A New England utility company, in insti tuting its guarantee by agreement with an independent union, was exclusively concerned about the possibility of continuing the regular salary payments it had theretofore been making, and the avoidance of penalty over time payments under Section 7 (b) (2) of the Fair Labor Standards Act. Employees and union were interested in the possible security the plan might afford. Where there was no collective bargaining agency at the time of initiation, desire to give security was the most frequently reported motive, and desire to provide conditions that would retain or attract skilled workers was the next most fre quently reported, as in the following cases: A Baltimore silver firm guaranteed employ ment to skilled silversmiths to induce them to come from New England, and paid their transportation expenses as well. An ice-cream company guaranteed employ ment over the slack winter months to a selected group of key workers whose presence when production resumed the following spring would minimize the starting-up and training problems that the firm had faced in past seasons. An automobile repair company instituted a guarantee during the war to keep its mechanics from going off to war plants. Objectives of guarantee plans have occasionally been expressed to be the eventual recognition of labor cost as a fixed cost of operation, com parable to overhead cost and not varying directly with production volume. Many managementv officials who have guaranteed employment have 28 GUARANTEED WAGE PLANS IN THE UNITED STATES consciously refused to accept this approach. One official in a company which has carried on an extensive employment stabilization program, for example, has stated repeatedly that employers should try to do everything practicable to “ assure” employment, but that they should not think in terms of “ guarantees.” A majority of the management representatives interviewed voiced no theoretical convictions on the question, regard ing their own guarantees of employment or wages as practical business investments to obtain im proved morale, lowered turn-over, a better work force, and greater production. Several officials were reluctant to classify their plans as “ employ ment guarantees,” or as “ annual wage plans” at all; they looked upon them as good employment policies and sound business procedures or, in a few cases, merely as contract provisions pro hibiting lay-off, to which they disliked to apply such designations. Influence o j Legislation. Although eight of the companies at some time during the existence of their plans took advantage of the provisions of Section 7 (b) (2) of the Fair Labor Standards Act, the overtime exemption afforded by section 7 (b) (2) was a motive influencing only five plans, and the primary motive in only one. At least 8 of the 15 plans introduced prior to 1935 were designed in part to provide unemploy ment compensation benefits in the absence of governmental legislation. After the passage of State laws, the possibility of tax reductions under merit rating provisions served as an attraction in one case. A plan introduced in 1939 was intended in part to supplement the protection of the unem ployment compensation laws. In one case, man agement's belief that the Government might even tually impose an obligation to guarantee employ ment was cited as a contributory reason for the introduction of a plan. 6. Extent o f Planning at Time o f Introduction Analysis of employment fluctuations, sales, pro duction policies, or distribution methods at the time of adopting a guarantee plan was in most instances closely related to pre-plan employment regularization experience. Normally such plan ning was done by established technical divisions of management, although there was substantial labor participation in the Hormel, Nunn-Bush, and Seaboard cases. Personnel offices supplied records of employment fluctuations; sales offices supplied data on fluctuations resulting from varia tions in demand and on the development of new products and distribution channels; production officials developed specific programs connected with maintenance activities, storage of finished products, and the reservation of certain work assignments for slack periods. In only one case was the employment of outside engineering help reported to the Bureau. The planning and even the analysis of detail was handled personally by the owner or a top management official in several of the cases. The most extensive planning was done by those companies whose guarantees as sured the most in terms of duration of employment or coverage of workers. The planning referred to above does not include cases which involved only a calculation of prob able cost made immediately prior to the introduc tion of a guarantee. These calculations were quick cost estimates made to ascertain the risk involved in meeting a guarantee or to set a limit to the company's financial obligation. Typically, they consisted of a review of pay roll for the last several years, to determine what the cost of a guarantee would be to certain individuals or to a certain class of employees if they were paid for time which they had not worked during the pre vious period. In most of the cases, management relied only upon the accumulated business and industrial relations experience of its officials. A handful of the more recent plans were intro duced after their originators' study of the betterknown plans previously in existence. In a num ber of cases, management officials reported that they had studied the characteristics of the Hormel, or Nunn-Bush, or Procter & Gamble plans. No recognizable carry-over could be seen in any of the cases studied, however, leading to the conclu sion that most of the guarantees were basically developed in independent fashion to reflect the particular objective or to take account of the particular stabilization problem confronting the individual firm. Similarities among plans seem to have been due chiefly to union extension of the principle of stabilized wages or employment to other firms under contract. 7. Effect on Wages and Working Conditions An overwhelming majority of the plans were introduced into an atmosphere of good labor rela EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES tions, and in most cases where collective bargain ing had a history of many years. In 42 of the cases studied, employees were organized in unions at the time of the plan's introduction, and, in an additional 4, unions came to represent em ployees during the existence of the plan. In two-thirds of the cases where unions represented employees, the unions were affiliated with one of the two major federations; one-third were inde pendents. In several cases, as has already been noted, desire to promote sound labor relations was advanced as an important specific reason for the introduction of a guarantee. In one such case, where past labor relations had been bad, the plan was regarded by both company and union as an indicator of future smooth labor relations, and as evidence of management's intention to maintain a labor force of designated size in the community. Whether plans introduced in the absence of union bargaining rights were designed in part to head off or combat union activity is not ascer tainable except in a very few cases. From the demonstrated interest of management in the problem of employment security, it appears that this could not have been an important motiva tion. It was reported to be a factor in four cases, three not involving an immediate organizational campaign and one involving a serious labor dis pute. The last case concerned the Crocker-McElwain Co., whose plan was introduced in 1921 during the Nation-wide “ open shop" drive. Management officials were interested in providing employment security, but also believed that it was equally important to advance the principle of the open shop. Accordingly, they proposed both a yearround wage guarantee and a system of individual employee contracts. The union which represented the company's employees objected to the indi vidual contracts as well as to certain features of the guarantee and went on strike. The company's plan went into effect after the union lost both the strike and its bargaining rights. The introduction of guarantee plans did not generally result in changes in wage or working conditions beyond the achievement of greater employment security, or in failure to make changes that would have taken place had the guarantees not been introduced. Generally, the introduction of a guarantee plan meant the achievement of a new* employment condition over and above other * 29 existing worker benefits. An examination of union contract provisions in plants which had guarantees does not reveal significant deviation from the kinds of contract provisions relating to union security, seniority, work transfers, and other conditions of work usually negotiated in the absence of guarantees, except in the case of the contract between the Nunn-Bush Shoe Co. and the Industrial Union of Master Craftsmen. This contract, in addition to defining a radically different method of wage payment, gave union officials the right to approve or reject the em ployment of new workers or the addition of new manufacturing operations, and provided that the cost of teaching an employee a new operation be deducted from his compensation. Changes in existing conditions did take place in five cases at the time the guarantees were intro duced; in three of them, the arrangement was made by agreement with the union representing the employees. In two cases, overtime pay was given up in return for the guarantee; in one of these, involving a textile finishing company, the union also relaxed its restrictions against thirdshift employment; in the other, involving a daily newspaper, the union waived its usual contract requirement for employment of extra workers for overtime hours. The Int'l Ladies' Garment Workers' Union agreed to a wage reduction in the case of a New York apparel manufacturer, and also consented to reduce the number of workers there tofore required by custom in the shop, in return for a guarantee bolstered by company deposit of a bond and a commitment to restore the original wage level in the event the company ended the guarantee. The introduction of a guarantee in the Crocker-McElwain Co., previously cited, resulted in loss of bargaining status by Eagle Lodge No. 1 of the Int'l Bro. of Paper Makers. (AFL). In the case of Berkshire Knitting Mills, a group of skilled production employees in 1936 proposed to accept somewhat lower piece rates, at levels below established local hosiery industry standards, in return for a guarantee of longer hours and a resultant higher annual income than during the immediately preceding depression years. This plan was approved by the employees and their employees' association, but the union that was attempting to organize the plant at that time opposed it as a lowering of industry standards. In five additional cases, guarantee plans were 30 GUARANTEED WAGE PLANS IN THE UNITED STATES introduced as complete or partial substitutes for requested wage increases that employers had refused to grant in collective bargaining negotia tions. No loss in wage levels or changes in other working conditions occurred in these cases. In two cases, radical changes in method of wage payment were instituted at the time of the plan’s introduction. In the case of the Nunn-Bush Shoe Co., the introduction of an employment guarantee was designed to shift the basis of compensation from a system of payment by the hour to a system of guaranteed employment with pay determined by the course of major production trends. Under the new system, hourly wage rates were abolished and a system of evaluated base rates established, not for the purpose of determining actual pay levels, but to establish sharing ratios for workers of different skills. The Columbia Conserve Co., when establishing its plan in 1917, placed em ployees to be covered by the guarantee on a weekly salary basis, with salaries determined by marital status and family size rather than by job, intro duced a profit-sharing plan, and gave employees a voice in management of the business. The firms involved in the 62 cases have, with very few exceptions, provided as liberal or more liberal employee benefits and maintained as high or higher wage levels than comparable firms in the same industry and area. As far as hourly wage level is concerned, there was general agree ment on the part of company and union officials, supported in many instances by the statements of local United States Employment Service offi cials responsible for plant recruitment and by comparisons with wage data available in Bureau of Labor Statistics files, that wage rates were in line with prevailing levels; in a few cases, the firms occupied positions of wage leadership. Vacation pay was almost universal in these companies, and several firms gave more than the typical industry practice of 1 week for 1 year and 2 weeks for 5 years of service. Pay for holidays not worked, usually covering 6 or more holidays during the calendar year, was granted in twothirds of the cases. Company-financed sick leave and insurance plans, or time-off provisions for sick leave, were common. One-third of the firms had pension plans, and slightly more than one-fifth had profit-sharing schemes. The va riety of plans and the multiplicity of combinations makes it difficult to state with exactness the re lationship of the companies under study to in dustry in general, but it is clear from the wide spread existence of “ fringe” or collateral practices that firms which have guaranteed employment or wages are also in the forefront of American management practice with respect to other conditions of employment. B. Outstanding Features of the Guarantees Under the plans the employers generally agreed to provide work equal to the extent of their guarantees, or equivalent pay when there was no work, but did not agree to pay without regard to attendance or work performance. The guarantees were based on the concept that a worker must be available to work when work is provided, and were usually inapplicable if the worker was absent or if he was incapacitated as a result of accident or sickness. In other respects, as in the case of rules governing transfers and dis charges, the plans operated within the framework of established or negotiated plant policies that were not appreciably different from practices in companies which did not guarantee wages or employment. 1, Character o f the Obligations Assumed The basic features of the plans have already been described in part III, and are set forth in detail in the appendixes to this report. A variety of eligibility and benefit provisions, in a variety of combinations, were the plans’ chief character istics. The combined effect of these provisions, in most of the cases, was to provide something less than a full year’s guarantee to substantially less than the entire work force. The nature of the plan was in some cases dictated by the employment stabilization problem which the firm faced. In the Hormel case, for example, the payment of a guaranteed wage each week was based upon a finding that fluctu ations in weekly working hours could not be reduced to manageable proportions, but that the annual volume of work was predictable; the same considerations gave rise to the continu ation of a fluctuating workweek, with weekly overtime pay for the most part on a straight-time basis; the unlimited coverage feature of the plan was based upon careful advance personnel budg eting of the number of jobs estimated to be required for a reasonably predictable annual EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES work load. Use was similarly made of the partial overtime pay exemption afforded by Section 7 (b) (2) of the Fair Labor Standards Act by several other firms whose annual volume was more stable than their volume from week-to-week or from month-to-month. For the most part, however, the variety of provisions relating to length of employment guaranteed and eligibility were reflections of management decisions concerning the extent of their commitments, of compromises made in collective bargaining, of the installation of guar antees into establishments with varying union security and seniority provisions, and of the individualistic drafting of the plans. Length-ofservice eligibility provisions were also in many cases reflections of broader personnel policy which emphasized length of service, or of management's specific desire to provide a larger degree of security for those workers whom management regarded as the most essential. The guarantee in most cases was based upon the employer's assumption of an obligation to provide fulLtime work throughout the year or, in the case of limited guarantees, work for a fraction of the year. There was no obligation to pay on a fixed annual monetary basis except in two cases, although the obligation to provide a certain amount of work at the employee's regular rate of pay was tantamount to a fixed wage guarantee if the employee worked throughout the guarantee period. In 40 percent of the cases, the plans contained no specific language obligating the employers to make up the full guarantee by paying for time not worked if sufficient work was not provided. The assumption usually appeared to be that sufficient work would be available, and in most of the cases, this has been true. It also appeared to be assumed or implied, although not stated explicitly, that the employer's obligation to provide work required that he pay at regular rates when he did not provide work. In almost all of the cases in which such employers were not able to provide work, payment was made. Em ployers occasionally referred to such occasions, however, as crises whose prolongation might have led to revision or abandonment of the plans, rather than as part of normal operation. In four of the cases, however, (two of which involved union agreements), the employer specifically re served the right not to pay in the event that lack 31 of work forced the company to lay workers off. These four firms “ assured" rather than guaranteed employment and committed themselves in writing to do what they could to provide it. In slightly more than half the cases, including the Hormel, Wisconsin Public Service, and other important guarantees, the plans clearly provided that management had assumed an obligation to meet the full amount of the guarantee even though this required payment for time not worked. This group also included six cases in which the guarantee was expressed as a prohibition against lay-off rather than as a positive guarantee and several of those in which employers consciously subsidized skilled workers for time not worked during slack periods. The four wage advance plans, uniformly intro duced to provide greater stability of income rather than a specific guarantee against lay-off, obligated the employers to advance wages during times of slack work, while the employee was still on the pay roll, and provided that the wages thus ad vanced be repaid during weeks when hours of work increased. Each of the four cases provided a different rule to govern the extent to which wages could be advanced. In one case, employees could receive the difference between actual earn ings and 60 percent of regular weekly earnings (computed on the basis of a 40-hour week); in another, the difference between actual earnings and 40 hours' pay a week; in the third, the differ ence between actual earnings and 30 hours' pay a week; and in the fourth the difference.between actual earnings and varying amounts, depending upon length of service and number of dependents, ranging from 40 hours' pay over a half-month pay period to an unlimited amount. Minimum eli gibility requirements were 6 months, 2 years, 3 years, and 5 years of service. Repayments of wage advances were made by deductions from future earnings: in one case by automatic deduc tion of one-half pf earnings during weeks in which the worker was employed for more than 24 hours; in another by deduction when working hours were above 40 per week; in the third by repayment of half the employee's earnings for hours over 30 a week; in the fourth by repayment of all hours in excess of 60 hours' work in any semimonthly pay period. The financial obligations involved in guarantee ing wages or employment were completely as 32 GUARANTEED WAGE PLANS IN THE UNITED STATES sumed by the employers in every case. One company, which guaranteed 1,800 hours’ pay to employees with 5 years of continuous service, reported having inquired about the possibility of insuring its obligation with Lloyd’s of London, and of having received a cablegram in reply read ing ‘1proposition quite impracticable.’ ’ Under an other plan, the company’s obligation to pay the guarantee ceased in the event of destruction of the plant; and an insurance contract provided that the insurer would thereafter assume the wage payments for a period up to 6 months. In two companies, specific monetary limitations were set on the company’s financial obligation. Specific arrangements to set aside funds to cover the possible costs of a guarantee were reported in two cases. In two others, the employer’s obliga tion was covered by a contract requiring the posting of a bond. 2 . Duration o f the Guarantee With very few clear-cut exceptions, the plans were basically designed to provide security within the year, for the indefinite future or for as many years as was possible, rather than to provide security against cyclical fluctuations over a longer period of time. Almost two-thirds of the 62 plans ran for a term of 1 year. In a majority of these cases, they took their terms from the terms of union contracts; in some, the 1-year term had been set outside the provisions of a union agree ment. It should be borne clearly in mind, in weighing the significance of the 1-year terms, how ever, that most of the 1-year union contracts provided for automatic renewal at the end of the year unless one of the parties to the contract gave notice of termination or intention to seek modifi cation. It was clearly the general intent to keep their guarantee plans in existence as long as the parties found it feasible and desirable to do so. Formal extension of the duration of a guarantee was illustrated by the case of the Wisconsin Public Service Corp., and the Int’l Union of Operating Engineers (AFL), who expanded their guarantee from a 1-year term to 2 years when they entered into a 2-year contract after their first post VJ-day negotiations. In the meantime, the extended term did not freeze other wage and working con ditions. The current contract provided a 1-year wage reopening clause. In one-fifth of all the cases studied the plans ran for an indefinite period of time; in none of these was there a union agreement involved, and the plans in every case but one were at any time subject to cancellation on management’s initiative. In only eight cases did the plan run for a definite term of more than 1 year: 5 years in one instance, 3 years in another, and 2 years by contract in six cases. In one case the guarantee ran only for the dura tion of the slack season. Workers covered in slack months were guaranteed nothing during the remainder of the year, when they could reasonably expect full employment. 3. Firmness o f the Guarantee In one-third of the cases, no provision was made for modification or abrogation of the guarantee within the term of the plan. All but two of these involved specific contract language in union agreements. In an additional five cases, modifica tion or termination was permitted only under “ act of God” clauses, or in the event of catastrophe, riot, strike, insurrection, or similar situation. Management had an absolute right to abrogate the guarantee at any time in another third of the cases, very few of which were embodied in union contracts. In an additional 15 cases, management could abrogate or modify the guarantee if certain conditions occurred: if sales fell below 80 percent of the previous year’s level; if events occurred beyond management’s control, explained in one case to mean the possibility of Government order or lack of materials; in the event of adverse busi ness conditions (the fact of which was subject finally to arbitration); in the event of discon tinuance of the firm (the legitimacy of which was in one case subject to arbitration); in the event of inability to obtain supplies and materials because of acts and restrictions of the Government; in the event of passage of an unemployment com pensation statute (removed from the plan at a later date, when the plan was continued beyond the passage of the law). In two cases involving agreements with the Int’l Ladies Garment Work ers’ Union, the plans could be discontinued by management upon the granting of increases in wage rates. All but eight of the plans were in written form. In 36 cases, the guarantees were reduced to writ ing in union contracts or were incorporated into EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES contracts by reference; 4 involved individual employee contracts; and 14 were in the form of written pamphlets or bulletin board statements. 4 . Computation o f the Guarantee Virtually all of the plans embodied the concept that an employee must be willing to work when work is available in order to qualify for his full guarantee. Days of unexcused absence were almost uniformly deducted from workdays for which the employee was guaranteed pay; in the two cases in which the employee was guaranteed an annual salary and in a few others the rules governing this matter were not clear. In 'the case of the Columbia Conserve Co., where salary scales were based upon marital status and family size, the problem of absences was handled by individual disciplinary measures where necessary, rather than by automatic deduction from regular wage payment. Most of the plans pursued further the concept that an employee must be willing to work, and required that he actually be available for work. Thus, in two-thirds of the cases, workers were ineligible for guarantee payments when incapaci tated as a result of accident or sickness. In an additional one-fifth of the cases, the worker was eligible for the guarantee when he received work men’s compensation payments, but such payments were offset against the guarantee, generally to prevent pyramiding of total wages above regular earnings. In three of these cases, the employee turned his compensation check over to the em ployer and continued to receive the guarantee. Less than 15 percent of the companies reported the offsetting of unemployment compensation pay ments against the employer’s guarantee obliga tion. One company reported that employees were disqualified from guarantee benefits when they received unemployment benefits. The small per centage of firms reporting offsets, however, largely reflected the fact that no experience had developed in most of the cases, because the employees in volved were given year-round employment and normally had no occasion to apply for unemploy ment benefits. Vacation, holiday, and sick-leave payments generally were not permitted to pyramid above guarantee payments covering the same period of time, especially where the guarantee comprised a full j^ear’s work or wages. In cases where the 33 guarantee was for less than a year’s duration, practice varied, vacation payments being added to the guarantee in some cases and counted to ward the guarantee in others. In a few cases, employees guaranteed wages or employment dur ing slack seasons were required to take their vaca tions during off-season periods. Ten percent of the plans provided for deduction of outside earnings from the guarantee, and in 2 cases receipt of outside earnings was cause for disquali fication from guarantee benefits. Under virtually all of the plans, the worker’s guarantee was computed on the basis of his regular hourly or weekly rate, and the rate of pay was not affected by the existence of the plan. The employ ee’s guarantee was computed on the basis of his hourly rate, excluding incentive bonus payments in the Hormel case. In two cases the guarantees were stated in terms of specific annual monetary payments. In the Nunn-Bush case, the employ ee’s rate of compensation varied in relation to production trends, his base or job rate being designed as a sharing ratio rather than as a rate of pay. Workers uniformly lost coverage upon discharge for cause. £• Transfers In four-fifths of the cases the employer had the right to transfer workers, where such transfers were practicable, to utilize their time on jobs other than the one to which they were regularly assigned, in the event of a* slack period. This right was almost always, in the case of firms under contract with labor unions, subject to contract provisions governing transfers, including seniority rules. In the remainder of the cases, transfers out of classification were prohibited by union contract, or limited to individual situations where the union gave advance consent. Negotiated limitations on the employer’s right to transfer were usually reported in the cases of specialized workers or ganized on a craft basis, where transfer would mean work outside the union’s jurisdiction, per haps involving the coverage of another labor organization. This was the case in plans involving textile printers, licensed marine personnel, me chanical trades workers on a newspaper, brewery workers, transit-mix drivers, and railroad shop workers. In one important case— that of the Nunn-Bush Shoe Co.— union consent to transfers 34 GUARANTEED WAGE PLANS IN THE UNITED STATES had to be obtained in advance although the union’s jurisdiction included all plant workers. In the Hormel case, where transfers were initially an integral part of the plan, the system provided that the worker remain at his station and that work be brought to him. Shifts of assignment were con fined to low-seniority employees who made up an “ extra gang.” In virtually all of the cases where job shifts occurred, the worker was protected against rate reduction during temporary transfers, although definitions of “ temporary” varied. Permanent transfers of assignment, when they occurred, usually meant changes in rate, even during the guarantee period. 6. Administration The basic responsibility for administration fol lowing the establishment of the guarantee obliga tion— for planning work assignments to meet the guarantee, for keeping records of working hours and their relation to maximum hours provisions, for determining eligibility, deductions, and pay ments due—rested in management hands. Execu tives or company owners took personal responsi bility for administration in the greatest number of cases, personnel or labor relations directors had responsibility in less than 20 percent of the plans, and administration was handled by minor office personnel in several. Where the guarantee re flected no greater employment opportunity than management and labor expected as a normal occurrence, administrative problems were reported to be nonexistent or to require little attention. Direct labor participation in administration existed in only a few cases, including two in which, as a result of specific management policy, labor’s role in all aspects of company administration had substantially greater scope than in most business enterprises. In the Columbia Conserve Co., the guarantee plan was described as one part of a broad experiment in economic democracy; workers were at first given a direct voice in management of company affairs through an employee council and were later given ownership rights. The NunnBush Shoe Co. regarded its plan as a cooperative venture on the part of labor and management, and union functions included participation in employ ment stabilization planning, periodic review of production and sales for joint determination of the level of guarantee payments, equal participation with management in determining transfers, and full participation in discipline proceedings prior to the taking of disciplinary action. The chief form of union participation was through the grievance machinery, which in almost every case provided for arbitration as the ter minal step in the settlement of disputes arising under the contract. In several cases labormanagement committees met regularly to discuss operation of the guarantee; their responsibility was generally an advisory one. Unions usually exercised a watchful role in plan operations, to ensure that obligations would be met, and in a few cases, that they actually could be met. In a number of cases where there were contractual union shop provisions, determination of eligibility was a matter under complete union control. In several others, such matters as changes in the size of the work force or the establishment of piece rates were subject to joint decision of labor and management. C. Experiences of Operation The obligations of the plans have been met— generally under favorable, but in some cases under difficult, circumstances. The safeguard provi sions and escape clauses have rarely had to be in voked. Most of the plans that went through depression periods weathered them successfully; abandonment of plans has been the result of special individual circumstances. The plans that operated under Section 7(b) (2) of the Fair Labor Standards Act experienced somewhat greater difficulty than those which did not take advantage of its provisions, largely because of the inflexible 2,080-hour limit on annual working hours. 2. Meeting o f Guarantee Obligations The employers’ obligations to pay guaranteed wages were met in every case studied, although in three cases the wage rates guaranteed were re duced under depression conditions. In almost half of the cases, this meant that the employers actually had to pay out or advance money for time not worked. In the remainder of the cases, the employers were able to provide work for all covered employees to the extent of the guarantee during all of the years in which the plans had been in existence. In no case did the employer fail to live up to the guarantee. In providing sufficient employment to meet their EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES commitments, of course, some employers who made no payments for time not worked did pay for time worked on maintenance, odd jobs, or other work at the rate of the employee’s regular classification. The extent to which employers provided special work to keep their employees on the pay roll is not adequately known, but the total amount of such work is believed to have been very small except in a few cases and was confined largely to the companies who also paid for time not worked. The most extensive pro grams of this type were reported in the Hormel and Procter & Gamble cases. During 1932 and 1933 the Proctor & Gamble Co. at its Cincinnati plant placed workers not needed in their regular jobs in a labor pool. Employees in the pool did general maintenance work on buildings, equip ment, and grounds and dug holes for proposed construction. At the Hormel packing house in Austin, Minn., a livestock shortage occurred in the drought year of 1935. Employees for whom no work was available in the plant were selected on a seniority basis and put to work building houses, 34 of which the firm erected on a contract basis before the shortage abated. In most of the cases in which payment was made for time not worked, it was expected by the em ployer that he would have to make such payments under the normal operation of his plan. In a few cases payment for time not worked was made only in situations that approached crisis proportions. In two such cases— Crocker-McElwain, and Seaboard Air Line Railway—payment for time not worked during the depression of the early 1930’s resulted in modification of the plan after the guar antee period had passed. None of the plans had to be modified during the guarantee period to enable the employers to meet the obligations which they had assumed. In the case of the Procter & Gamble Co., modifications were prepared by the board of directors for possi ble use during the depression of the early 1930’s but never had to be used. Somewhat less than half the plans were modified in some fashion during their existence at the time plans were renewed; the remainder continued as they had first been adopted. Several of the changes were very minor, having to do with ad justments to a new workweek or vacation allow ance, provision for temporary exclusion of wartime recruits to preserve jobs for veterans, and removal 772334°— 48---------- 6 35 of a contract requirement for collateral. Other modifications dealt with the “ safeguard” or “ escape” provisions of the plans: in one case inaugu ration of a union contract eliminated a company’s right to abrogate the guarantee at will, in another a 5-year guarantee with an escape clause was changed by negotiation to a 1-year guarantee with no es cape provision, and in a third a company elimi nated its own previously announced right to aban don its plan if an unemployment compensation law were passed. Duration of the guarantee or coverage of workers was expanded in a few cases following favorable experience with limited plans, notably in the case of the Hormel Co., where the plan had started initially in a department of 19 workers and was gradually expanded to cover more than 4,000. In a few instances, coverage was contracted; the most important case of this group was the Procter & Gamble Co., which changed the eligi bility requirement from 6 months to 2 years be tween 1933 and 1936, because of rapid expansion of the company and the hiring of many new employees. Regularly planned revision of the guarantee was a feature of four cases— Hormel, Nunn-Bush, Seaboard, and Columbia Conserve. In the Hor mel case, forecast of the demand for meat products, along with departmental review of the number of positions required to turn out a given volume of work, was made annually, and resulted in changes in departmental crew size and guaranteed hours of work. In the Nunn-Bush case, whose basic fea ture was the adjustment of payments to long-term fluctuations in production rather than a fixed guarantee, sharing ratios of covered workers were modified periodically, to reflect long-range changes in production volume; and over the years of the plan’s operation employees were classified into several groups with respect to the degree of their sharing. In the Columbia Conserve case, periodic revisions in guaranteed salaries were made, usually in the light of long-range market trends. In the Seaboard case, the minimum-crew provision of the contract was reviewed each year by management and labor to redetermine the size of the minimum crew. 2. Effects o f Business Depression Eight of the plans went through the depression of the early 1930’s; six of them are still in existence, 36 GUARANTEED WAGE PLANS IN THE UNITED STATES although one has been substantially modified. Of the remaining two, one was discontinued as a consequence of the depression, and one was dis continued in 1942 following a labor dispute. The experiences of each of the eight cases are presented in summary fashion: A small roadbuilding company has had an informal, unwritten guarantee in effect since 1926, providing a weekly salary for 52 weeks a year as long as the employee is available for work. The guarantee covers 8 employees, and the work force is increased by 5 to 15 per sons during the peak summer season. The plan was designed to keep trained employees from leaving the company during the winter months, and represented a conscious subsidy for time not worked. During the depression, the company’s business boomed, its work in 1931 being almost twice the 1929 volume. An indefinite guarantee of regular earnings in each 4-week pay period, to all employees with 5 years’ service, introduced in the early 1920’s by the Crocker-McElwain Co., of Holyoke, Mass., and its subsidiary, the Chemi cal Paper Manufacturing Co., resulted in sub stantial payment for time not worked in 1930, when company business declined and non working time amounted to 30 percent of avail- able annual working time. At the end of the year the guarantee was reduced, and after a further decline in working time in 1931, the guarantee was again reduced in 1932, finally standing at less than 50 percent of the full yearly income originally granted. The guar antee was never revised upward after the de pression, and the plan was abandoned in 1937. An unwritten guarantee covering workers in a Michigan wholesale grocery company was maintained throughout the depression of the early 1930’s. Employees were given other duties around the warehouse or were allowed to go home when there was no work. The company absorbed the cost of the pay ments required (as to the size of which there are no available records) and the plan con tinued thereafter with no changes. The first depression experience of the Co lumbia Conserve plan occurred in 1921. According to an account furnished by com pany officials, the company entered the year with a heavy inventory made up primarily of tomato products, a result of the previous year’s large contracted acreage. With a falling market for their products apparent, new commitments were avoided until in ventory was depleted. Prices fell and goods had to be sold at a loss. All workers not covered by the guarantee were laid off, and production was confined to filling orders that had actually been received. During the remaining years of the 1920’s the plan oper ated successfully, with a gradual expansion in the number of workers covered. The company was not seriously affected by the depression of the early 1930’s until the latter part of 1932, after other failures had already occurred in the canning industry. Again, the company had built up a heavy inventory, and had volunteered to carry 23 wage workers on its rolls after the tomato season, in addi tion to an unsually large number of covered workers— the number having risen during the preceding years of prosperity—in order to help alleviate the unemployment situation. During 1933 all of the workers were continued on the rolls, despite the company’s policy of cutting production. In 1933 the council, consisting of covered workers who determined the policy of the enterprise, voted to cut base salaries by 50 percent, the remainder to be paid back in more prosperous years. (Repayments were made in 1935 and 1937.) Toward the end of 1933, however, more drastic measures were necessary and the workers again cut their salaries by 50 percent, this time agreeing not to require reimburse ment. The second 50 percent cut was re stored in 1934, and thereafter wages were gradually raised until they reached 80 percent of the 1932 level in 1942, the year of the plan’s abandonment. Licensed marine personnel on a number of Great Lakes vessels have been under guaran tee contracts at various times. The Masters, Mates and Pilots of America have had a con tract with the Detroit & Cleveland Naviga tion Co. since 1919, providing for continuing payment during the season when ice closes the Lakes to navigation. The guarantee was retained throughout the depression despite a EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES two-thirds drop in the number of passengers carried and a one-third drop in freight ton nage between 1929 and 1932. Employees are reported to have taken a voluntary cut in wages, of unknown amount, at the time, which did not show up in contract provisions regard ing the guarantee. Informal guaranteed employment plans for skilled dry cleaning workers in a Middle Atlantic area go back at least to 1903. A more formal arrangement, set out in a union contract, began in 1918 in the firm studied. At the time of the study, the plan, which guaranteed 52 weeks of employment at 40 hours a week, covered about one-third of the employees and was reported to have experi enced no difficulties whatever during the entire period of its existence. The Seaboard Air Line Railway and System Federation No. 39, affiliated with the Rail way Employee’s Department (AFL), inau gurated a minimum work force guarantee in 1928. The plan was proposed by union officials when their request for a wage increase was refused by the company and was designed to spread shop maintenance work and employ ment more evenly throughout the year. The agreement at first specified the number of employees to be maintained at each terminal point, but was changed in 1930 to specify a system-wide number, with transfers of posi tions permitted from shop to shop and from city to city. Following a fall in operating revenues during 1930, management, in negoti ations for a 1931 agreement, refused to con clude a minimum-force contract unless mod ification by either party was permitted during the year. Agreement was finally reached and provided for a specified minimum force as of January in each year. The contract provided further that if “ any situation arises during the life of this agreement which would seriously affect either party, a conference will be held between the management and the general com mittee for the purpose of reaching an agree ment. In event of failure to do so, it is under stood and agreed that either party may ter minate this agreement by serving 10 days’ notice in writing upon the other of intention to 37 do so.” Both sides recognized that the effect of this modification was to change the guar antee to a plan that spelled out intent and provided 10 days’ dismissal notice. The union pointed out, however, that the requirement for action by top management and the union’s general committee still curbed what had been the chief source of employment instability, eliminated through the employment stabiliza tion program that started with the plan— the work planning, hiring, and firing done by shop supervision as a result of irregular work budget appropriations. Under the new agreement, the size of the guaranteed work force fell dur ing the depression years as follows: Guaranteed work force G u a ra n teed . w orkforce 1928______ ________2, 170 1929______ ________2 ,2 3 5 1930______ ________2 ,2 2 2 1931______ ________ 1 ,9 6 7 1932______ ________ 1 ,8 0 0 1933______ ________1 ,7 3 5 1934______ 1935______ 1938______ 1945______ 1946______ _______ 1 ,7 2 5 ________1 ,7 2 5 _______ 1 ,7 7 7 _______ 2 ,3 0 0 _______ 2 ,3 0 0 The Procter & Gamble plan was inaugur ated in 1923 after more than 2 years of work by management on the problem of employ ment stabilization. The plan originally pro vided, in brief, for a 48-weeks-a-year guarantee at standard weekly hours to all employees with six months of service. The general busi ness slump of the early 1930’s is reported by management not to have affected the company until the fall of 1931. By that time, it is re ported, demand had fallen to a considerably greater degree than was anticipated, ware house stocks rose, and production was cur tailed. In order to provide the employment which it had guaranteed, the company set up a labor pool, to which workers not needed on their regular assignments were sent. From the pool, workers were assigned to a variety of maintenance and construction jobs. At times the percentage of workers in the pool ran as high as 10 percent of total employment, and most of the employees are said to have been involved in pool operations at some time dur ing 1932 or 1933. Despite a sizable increase in maintenance and construction activity, company officials in 1932 grew increasingly doubtful of the ability of their company to meet its commitments toward its employees, 38 GUARANTEED WAGE PLANS IN THE UNITED STATES and the framework of the plan was modified to permit the company a greater degree of flexibility. In August 1932, the guarantee was revised to reserve to the company the right to limit hours of work to 75 percent of the established workweek whenever in the opinion of the board of directors such action seemed to be justified. Under this provision, the board of directors, in January 1933, auth orized such reduction in five of the company's plants. Only two of these plants were actual ly notified of the board's action, however, and even in these the guarantee was met without the necessity of taking advantage of the re laxation. In January 1933, the eligibility re quirement was increased from 6 to 12 months of continuous service. The plan was also amended at that time to reserve the com pany's right to withdraw the guarantee at any plant or to terminate it or modify it at any time. All 26 of the 62 plans that went through the business recession of 1937-38 weathered its effects successfully. All but three of the 26 are still in existence; discontinuance of these three was in each case unrelated to the effects of the recession. In 22 of the 26 cases, the company was able to meet its obligation under the guarantee without the necessity of taking special action. The other four cases involved the McCormick, National Oats, Seaboard, and Nunn-Bush plans. In the case of the McCormick Co., whose sales fell off during 1938, the company produced to the extent of its storage capacity, and increased the volume of its maintenance and remodeling work. Em ployees voted to reduce the hours in the work week if necessary in order to work throughout the year; but this was not necessary. In the National Oats case, sales fell off during 1937, and the expected fall peak failed to materi alize. Only workers covered by the guarantee were kept on during the summer slack period and up to the early fall. They performed maintenance work, blew down dust, scraped off machinery, dug a ditch for a new water line, and cleaned up the plant in general. The guarantee was met with very little payment for time not actually worked, f and no workers suffered rate reductions during their temporary transfers to other jobs. Under the Seaboard plan, the size of the mini mum work force was reduced by agreement during 1938 from 1,850 to 1,725, because of a decline in business. The Nunn-Bush plan was probably the most seriously affected by the events of 1937-38. Demand fell off and prices slumped in the late summer of 1937, causing management and labor to agree upon the cancellation of a recently given advance in base sharing rates, and a return to a lower base-rate multiplier (37, instead of the existing 40) that*had been used in 1935. Pro duction was continued for stock; temporary workers, who then constituted about 11 percent of the total working force, were kept on by agree ment. The group fund began to run a deficit, but production was continued, dropping only as normal turn-over reduced the labor force, and wage payments were maintained. The large inventory of shoes accumulated during the depression is re ported to have given the company some competi tive advantage when production resumed in the industry after the depression, and the group fund deficit was liquidated in 1941. 3 . Discontinued Plans Of the 46 discontinued plans about which the Bureau had information, detailed studies were made in 15. The discontinued plans demon strated no characteristics essentially different from those that were still in operation at the time of the survey, in terms of basic employment sta bility of the enterprise, duration or coverage of the guarantee, or experience under the plan. Discontinuance appears to have been almost wholly the result of individual circumstances. All of the discontinued plans studied in detail went out of existence after the depression of the early 1930's.4 Business conditions or the ability of the employer to meet the guarantee seems to have been an important contributory cause of abandonment only in the case of the CrockerMcElwain Co. and the Chemical Paper Manu facturing Co., previously cited. In 1937, when the plan was abandoned, the guarantee stood at less than 50 percent of full weekly wages. Man 4 See Unemployment Benefits in the United States, by Bryce M . Stewart (New York, J. J. Little & Ives Co., 1930), pp. 363-371, 374-386, and 463 ff.; and Operation of Unemployment-Benefit Plans in the United States Up to 1934, in Monthly Labor Review, June 1934 (pp. 1288-1324), for discussion of plans discontinued during and prior to the depression of the early 1930’s. EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES agement had come to regard the plan as ineffective, and discontinued it upon the passage of unemploy ment compensation legislation. In dealing with the question of discontinuance resulting from business depression, the case of the Seaboard Air lin e Railway should, of course, be noted. Technically, what was formerly a guar antee is now a statement of intent to employ a minimum force coupled with a 10-day dismissal clause. The union regards the minimum force agreement as of continuing value, however, and emphasizes the fact that the contract expresses the firm intent of the company and can be abrogated only by top management. In its present form, the plan has approximately the same degree of firmness that exists in a number of other plans, such as those which can be withdrawn at any time, and such as the McCormick plan, under which the company has announecd its intention of doing everything it can to provide a stipulated amount of work, but without a formal “ guarantee” of a definite number of hours per week or per year. Four plans were discontinued during World War II, largely as a result of wartime conditions. At the time they ceased, they had been in operation 2, 4, 5, and 6 years, respectively. In one case, the plan had operated by agreement between the company and an independent union under the 2,000-hour ceiling provided by Section 7 (b) (2) of the Fair Labor Standards Act. Manpower shortage and wartime manpower regulations made the contin ued operation of the annual hours ceiling im practicable. In addition, employees desired to work overtime at premium rates to increase their total earnings. The plan was abandoned by agree ment and has not been revived. Management looks with favor upon its revival sometime during the postwar period, but employees are reluctant to give up overtime pay during a period in which the company’s products— construction materials— are in heavy.demand. The second case of wartime abandonment also involved a 7 (b) (2) plan, negotiated between the Barlow & Seelig Co., a washing machine manu facturer, and the Steel Workers’ Organizing Com mittee. It was abandoned in 1942 because of the company’s uncertain business future during the war period. Union officials expressed interest in revival of a guarantee but were cool toward the possibility of its taking the form of a 7 (b) (2) plan again. Management was favorably inclined 39 toward the possible revival of some kind of guarantee. The plan of a midwestern baby carriage manufac turer was entirely the product of the owners’ indus trial relations philosophy and the desire to assure employees an annual income. The guarantee, embodied in a bulletin board statement, provided for 1,760 hours’ work a year, plus vacation, to all employees with 1 year’s service. The uncertainty of production under war conditions made manage ment reluctant to continue its formal guarantee. The bulletin board statement was removed and new employees were no longer told that the com pany guaranteed employment. Old employees who remained with the company were not told that the formal plan was abandoned and actually received more work than the guarantee had called for. The owners stated that they intended to restore a formal guarantee plan at an early date. A Baltimore silverware manufacturer guaran teed its journeymen and apprentice silversmiths 52 weeks of 48 hours (including 8 hours pay at time and a half) per year. In 1942, wartime con ditions made it difficult for the firm to secure raw materials and it was forced to discontinue manu facture of silverware and to cancel the guarantee. As soon as normal operations are resumed, man agement reported, it intends to revive the plans. Four plans, including two wage advance plans, were abandoned after management had come to the conclusion that the plans were not needed, because the employer was able to provide sub stantially more work than the guarantee provided. All but one of these plans had been in existence for 3 years or less. All were abandoned between the years 1939 and 1942. Three plans were abandoned as a result of employee and union dissatisfaction. Two of these were cases in which the plans had been introduced to avoid overtime payments under the Fair Labor Standards Act, in one case by a 7 (b) (2) contract with an independent union and in the other case by a scheme for advancing credit hours at the beginning of the year and offsetting overtime hours on a straight-time basis. In the first case, em ployee opposition to the plan arose over a provi sion for compensatory time off rather than over time pay for hours over 40 a week, and over the practice of laying employees off— in some cases as early as November— when they reached their 2,000-hour limit. The employees switched union 40 GUARANTEED WAGE PLANS IN THE UNITED STATES affiliation, and negotiations with the new union resulted in elimination of the plan. In the second case, employees covered under the plan became dissatisfied with the fact that they received only straight-time credit for overtime hours, while employees not covered received premium over time rates. This plan, too, was abandoned as a result of union action. In the third case, a guar antee of 3 days’ work a week for 52 weeks a year had been granted by agreement in a small furni ture manufacturing shop as a condition of the union’s withdrawal of its demand for a wage in crease. The guarantee proved to yield less em ployment than the employees could normally count upon, and other firms in the industry granted the wage increase which the union had given up for the guarantee. At the end of 1 year of opera tion, the guarantee was abandoned and employees received the industry-wide wage adjustment. The three remaining cases of discontinuance in volved a manufacturer of electrical apparatus, the Columbia Conserve, and the Namm Store plans. Passage of unemployment compensation legislation was reported as the reason for discontinuance of the 1,500-hours-a-year guarantee in the first of these three cases. The guarantee in this case had lasted from 1931 to 1938, covering in 1933 approximately 7,000 plant workers in a number of plants— a larger number than was covered by any other guarantee studied except the General Motors w^ge advance plan. The Columbia Conserve plan was aban doned as the aftermath of a labor dispute. Wages and union organization had arisen as issues among the employee-owners, resulting in a War Labor Board dispute case and a court suit. The employee-ownership feature of the plan was ended by court order as a result of the suit, and the management of the company simultaneously ended the guarantee. Mr. William P. Hapgood, presi dent of the company and founder of its experiment in industrial democracy, stated to a Bureau representative at the time of the study that a guarantee might some day be attempted again. The Namm Store plan operated between 1939 and 1943 and guaranteed from 40 to 52 weeks of work a year, depending on length of service, to all wage earners with at least 1 year’s employment status. Management officials had regarded the plan as a significant addition to working conditions, but during the early years of World WTar II they became worried about possible conflict between their obligations under the plan and their obliga tions to returning veterans. Because of wartime turn-over the proportion of new employees was considerably greater than previously. To these new employees, union organization appeared more important during this period of high employment than the guarantee plan. When the employees organized, no request was made for continuance of the plan in the initial contract negotiations, and management dropped the guarantee. Guarantee plans covering certain groups of employees were dropped in two additional cases, although similar or identical plans covering other employees in the same establishment were con tinued. One of these involved the composingroom employees of a midwestern newspaper, who were guaranteed 52 weeks of work during the calendar year under a 7 (b) (2) contract. The agreement provided further, in contrast to stand ard contract language in printing trades agree ments, that regular employees would work on the sixth day, at straight-time rates, where necessary. This agreement had been entered into because of the difficulty of obtaining printing help for the sixth day of work, and because of the parties’ desire to avoid declines in productivity that usually pre ceded seasonal slack periods. The plan was discontinued at the end of 1941 because of the refusal of the international union to sanction its renewal. The international objected to the elim ination of time-and-a-half pay for overtime work and to the reduction of employment opportunities for transient printers. The second case involved longshore employees of a Great Lakes transporta tion company, whose guarantee was discontinued when the company subcontracted its longshore work. 4. Operation Under Section 7 ( 6) (2) The plans which operated under Section 7 (b) (2) of the Fair Labor Standards Act merit special consideration as a group, since their experience constitutes the only experience to date of the operation of plans under a Federal statutory provision designed in part to encourage guaran teed wage or employment plans. Twenty com panies reported the operation of guaranteed wage or employment plans (8 of which are still in opera tion, the remainder having been discontinued, largely during the war years) under Section EXPERIENCE WITH GUARANTEE PLANS IN SELECTED CASES 7 (b) (2) of the Fair Labor Standards Act.5*7 The number of plans that have fully met the require ments of the law is unknown; none has been the subject of final court determination. In some of the 20 cases, however, there was some ques tion whether the full requirements of the law or regulations had actually been met, (a) because of apparent failure to meet the requirement that the union representing the employees be certi fied as bona fide by the National Labor Relations Board, (b) because of contract provisions that may not have met the full requirements of the law (a matter which could not be finally deter mined because the plans had not been officially commented upon by the Wage and Hour and Public Contracts Divisions or ruled upon by the courts), or (c) because of failure (in 5 cases) to file contracts as required by regulation. Eight of the companies which took advantage of the provisions of Section 7 (b) (2) were studied in detail by the Bureau. In one case the induce ment of the overtime exemption was reported to have been responsible for initiation of the plan, sponsored by management. In two, the over time exemption was reported to have been im portant in determining management’s accept ance of union proposals for guarantee plans. In another, management’s desire for overtime exemp tion and labor’s desire for security were reported as equally important motives. In the remaining four cases, guarantee plans were already in oper ation or about to be put into operation in October 1938, the effective date of the Fair Labor Stand ards Act, and were modified to conform to its provisions. Of the eight guarantees studied, five are still in operation (in only four cases under 7 (b) (2), however). One of the former 7 (b) (2) plans was abandoned because of employee dissatisfaction following a drop in annual earnings during the 2 years after the plan’s inauguration. The earn ings decline had resulted from operation of the annual-hours ceiling, some employees having to be 5 Employers who had filed contracts with the Wage and Hour and Public Contracts Divisions under the provisions of Section 7 (b) (2) were included in the Bureau’s canvass; the Administrator’s regulations under the Fair Labor Standards Act require that contracts under Section 7 (b) (2) be filed with the Wage and Hour and Public Contracts Divisions. Twenty of the 347 companies studied reported operation under Section 7 (b) (2). Five of these firms, however, were not included in the list of companies that had filed with the Wage and Hour and Public Contracts Divisions. 41 laid off as early as the first week in November. The second was abandoned because of the difficulty of adhering to the annual-hours limit under war time conditions. The third was abandoned be cause of the general uncertainty of operating any guarantee under wartime conditions. In the latter two cases, some sentiment was reported for eventual reinstatement of a guarantee, although in both cases union representatives vwere luke warm about the possibility of the plans again taking the shape of 7 (b) (2) arrangements because of the elimination of premium overtime pay and the absolute ceiling on annual hours of work. In an additional case, where a guarantee is still in operation, 7 (b) (2) provisions were eliminated in 1942 because of longer wartime working hours. The best-known of the guarantee plans which operated under Section 7 (b) (2), and the one which covered more wage-earners than any other 7 (b) (2) plan, has been that of Geo. A. Hormel & Co., whose plan antedated the Fair Labor Stand ards Act. At the Congressional hearings on that act, representatives of the firm urged the inclusion of a provision which would enable it to preserve its established guarantee; Section 7 (b) (2) was framed to encourage and to allow the continuation of arrangements of this kind. Consequently, pas sage of the act caused only slight technical changes in the Hormel plan as it then existed. The plan provided that covered workers were to receive, weekly, 52 equal parts of estimated annual wages— based on estimated annual production— with additional pay on an incentive basis. Weekly hours were not fixed, the only restriction on them being that a worker’s annual hours must not exceed 2,080; on a weekly basis, hours were not limited, but overtime payment was stipulated after 53 hours a week. The firm continued to operate under 7 (b) (2) without difficulty until 1944, when volume of work and the wartime manpower short age made it impossible to observe the stipulated 2,080-hour limitation on employment for 374 of the workers. Their earnings were recomputed on a weekly basis without the advantage of the over time exemption. The plan continued to operate under 7 (b) (2) for the remaining workers in the plant. Six of the 8 firms which operated under Section 7 (b) (2) reported some difficulty during their experience with the plan in balancing man-hours so that the annual limitation stipulated in the law 42 GUARANTEED WAGE PLANS IN THE UNITED STATES would not be exceeded. In two of the cases it was necessary to lay off workers before the end of the year. One-third of the 54 employers (of the entire group of 62 studied) did not invoke the provisions of 7 (b) (2) in connection with their guarantees because they were unable to meet requirements of the section (the guarantee provided either more or less employment than the stipulated 2,080 hours, or no bargaining unit existed in the plant) or because by the nature of its business the firm was not subject to the Fair Labor Standards Act. Other reasons for failure to take advantage of the provisions of 7 (b) (2) reported less frequently were union opposition to elimination of premium overtime payments and the impossibility of con trolling employees* annual hours to conform to the 2,080-hour limitation. Management officials at Procter & Gamble and Nunn-Bush stated that they had no desire to receive exemption from pay ing overtime premiums. A large proportion of employers who did not invoke Section 7 (b) (2) were not acquainted with its provisions.6 Chiefly because of unfamiliarity with its pro visions, very few of the employer or union officials interviewed had suggestions to make for improve ment in the provisions or administrative interpre tation of Section 7 (b) (2). Three employers sug gested the removal of the 2,080-hour ceiling on hours, and the substitution of an annual overtime penalty provision for hours beyond this point. Four suggested that the provisions of 7 (b) (2) be made applicable to nonunion as well as to union employees. It was also suggested that the securing of interpretations or rulings on the legal ity of guaranteed wage proposals from the Wage and Hour and Public Contracts Divisions be facilitated and that such action be taken before contracts were signed or went into effect. Two employers and one union official suggested that, in addition to an annual guarantee, the section provide for a guarantee of minimum hours per week. In general, union officials were reluctant to consider giving up premium overtime rates for a guaranteed wage. 0 No special reasons for not utilizing 7 (b) (2) were reported by the employ ers who had filed contracts with the Wage and Hour ahd Public Contracts Divisions but had not, in fact, operated under guaranteed wage or employ ment plans. 5, Costs A full accounting of the costs of the guarantee plans that have operated in the United States was unavailable. To a very large extent this resulted from the difficulty of isolating the effects of the guarantees from the effects of other business and employment conditions. To an equal extent, it resulted from the absence of adequate cost ac counting systems for tracing the specific effects of the plans. The inadequacy of records resulted in large part from the fact that the employers who introduced the plans believed themselves able to evaluate their own experiences without special record keeping. The kinds of expenditures actually experienced, both direct and indirect, were as follows: Direct Expenditures Payment for time not worked. Payment at the worker’s regular rate of pay for fill-in jobs which normally carry a lower rate. Payment for make-work. Losses on wage advances. Indirect Expenditures Time of personnel, labor relations, and sales offices devoted to planning and laying the foundation for the plan. Outside engineering service. Provision of extra storage space for production in excess of pre-plan storage capacity. Cost of maintaining wage reserve. Tie-up of capital in inventory caused by production for stock. In the plants studied, records were generally kept only on the direct expenditure items of payment for time not worked and losses on wage advances. It was therefore necessary to rely almost wholly on management statements concerning their total cost experience. One-half of the firms reported no expenditures whatever. Three-quarters of the remainder (about 35 percent of all the firms) had paid for time not worked, and the remaining companies had incurred payment for some of the other items listed above, but not for unworked time. Keports on savings traceable to the operations of the plans were even more difficult to obtain than reports on expenditures. Savings of various types were reported to have been experienced, although records were not ordinarily kept on most of these items: EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES Direct Savings Reduction of unemployment compensation taxes under merit-rating plans. Elimination of overtime payments required after 40 hours a week by the Fair Labor Standards Act. Lower wage rates than those of competitors. Indirect Savings Reduction in cost of training new workers. Reduction in turn-over costs. Increased productivity. Savings in overhead costs through constant use of equipment. Recruitment of more efficient employees. Competitive advantage resulting from presence of accumulated stocks. The only savings that were reported to the Bureau in specific terms were those affecting unemploy ment compensation taxes and the elimination of overtime payments at time and a half required by the Fair Labor Standards Act. It seems clear that there was no net expense at all to the companies involved in half the cases. In the remaining half, there was not an adequate record of expenditures and offsetting savings to warrant conclusions concerning net costs of plan operation. Employers who incurred some ex penditures reported almost uniformly that their outlays had been offset by compensating savings, or benefits such as increased morale and pro ductivity which resulted in compensating savings. Although the employers’ own observations in these cases could not generally be substantiated by data, the expenditures in most of the cases were so small that they were reasonably certain to have been offset. D. Management and Labor Evaluation of Results The results of the plans can be assessed on the basis of two types of information: (1) Data on business operations, employment, and earnings of employees; and (2) the observations and con clusions of management and union officials who have had constant contact with the plans’ opera tions. The latter has turned out to be a much more fruitful source, because comprehensive and valid statistics on the effects of the plans are extremely difficult to obtain. Record systems have not been set up to trace the specific effects of the guarantees, and it is generally difficult, if not impossible, to isolate the effects of the guaran tee plan from the effects of other aspects of 43 business operation and factors beyond the control of management or labor in an individual concern. The accomplishments of the plans have to be viewed in the light of their objectives. As has already been pointed out, in half of the cases introduction of the plans was not expected to contribute toward enlargement of the area of stable employment opportunities or to stabiliza tion of income. The guarantees in these cases reflected the degree of stable employment that management and labor believed was already in existence, or, in a number of other cases, the degree of employment regularity that was achieved after efforts to stabilize had laid the ground work for an expanded area of stable employment. In the great majority of the cases, the achievements realized were substantially the results that had been expected at the time the plans were intro duced. 1. Accomplishments o f the Plans in the Field of Em ploym ent Security The basic accomplishment of the plans was a greater sense of security for the wage earners covered. Management, labor, and employees in terviewed emphasized the beneficial effect of the plans upon employee morale and the individual’s sense of security, even in those cases in which management’s guarantee represented little or no more than the employees could normally expect as a regular condition of employment without a guarantee : In the case of a public utility which guaran teed employment to employees with 5 years of service only, and in which the plan was introduced after several years of employment stabilization efforts, both management and labor agreed that the guarantee represented substantially what company policy had been prior to the plan. The employees and thenunion nevertheless considered the benefits of the plan sufficiently great, from the point of view of the security it granted, to warrant their having given up overtime pay at time and a half for a period prior to World War II. Union representatives asserted that they would seriously consider strike action, de spite a long no-strike record, if management attempted to abandon the plan. Labor and management have now turned their atten 44 GUARANTEED WAGE PLANS IN THE UNITED STATES tion to the problem of lengthening the plan’s term, and have, under their current contract, extended the guarantee to provide 2 years, or 104 weeks, of work. A union representative who had negotiated a large number of basic crew* contracts cover ing employees whose services would normally be required throughout the year reported that a guarantee clause was a basic feature of all contracts negotiated by his union. While the issue has never arisen, he reported, it would clearly be union policy to insist upon a guarantee at the cost of other improvements in wages or working conditions, if the choice had to be made. In a number of cases, management officials who were interviewed reported that the plans had no special effects on employee morale or attitude, largely because the plans were extensions of what management was already doing. In contrast, a positive advantage pointed out by several labor representatives was the fact that spelling out the plan, even though it represented nothing more than past company policy, improved labor rela tions and employee attitudes by demonstrating firm company intention to continue that policy. The establishment of a guarantee under circum stances of stable employment has involved the same considerations that have led management and labor in thousands of contracts to reduce to writing, working conditions and rules that are accepted and completely taken for granted by both parties. In about 40 percent of the cases, added security or a sense of security was reported to have been the most significant achievement of the guaran tee. Experience under these plans was generally inconclusive, however; almost three-quarters of them could be said to have undergone no real test, because they had operated in fairly prosperous years and available work had equaled or exceeded management’s obligations. The guarantee level in most of these instances might be of much more immediate significance to covered employees dur ing periods of business depression. In several, however, coverage was so limited that a sense of security would undoubtedly be their sole contri bution at any time. Where payments were made for time not worked, the plans also contributed to income stabilization. As has already been pointed out, such payments were made in 40 percent of the 62 cases studied, in amounts ranging from a few dollars a year for all of the covered workers as a group to several months’ pay for each worker involved. In addition, income regularization re sulted from the spreading of work even in situa tions where no payment was made for time not worked. In all, some degree of income stabiliza tion can be said to have resulted from the opera tion of the plans in 33 of the 62 cases. In 9 of these, stabilized income resulted from payments to skilled or key workers during slack periods, largely for the purpose of retaining their services; in 21, from payments to larger groups of workers, generally in small amounts; in 3 cases, from wage advances. The widest effects of the plans occurred in 12 cases where, according to labor and management reports, the area of stabilized employment op portunities appears to have been widened as a result of employment regularization activities undertaken concurrently with the plan.7 These activities enabled the employers to guarantee em ployment to workers who had not previously had stable employment or a reasonable probability of it. They did not result in general extensions of the guarantees to other workers, beyond the extent of the obligations that the employers had already assumed, however. Where such broad extensions did occur, as in the case of the Hormel plan, they resulted from the same impetus to regularize em ployment and provide security that had estab lished the plan on a limited basis in the first in stance. The character of the accomplishments achieved in this group of 12 cases can be obtained best by a summary of the individual situations: (1) In the case of the Berkshire Knitting Mills, of Reading, Pa., a guarantee of 50 weeks’ work was granted in 1936 to skilled hosiery knitters, in the form of individual contracts providing minimum weekly payment at levels below pre vailing industry code minimums, and transfer to other types of knitting in the event that there was insufficient work on their own machines. From the workers’ point of view, the plan was intended to grant security to knitters who worked 7 Some additional effects of this type may have resulted, though not re ported by either management or labor representatives. In very few cases, the plans may also have had some effect beyond the establishments in which the guarantees operated. Inquiry along this line was outside the scope of this study. EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES on hosiery that was not selling well; the intention of the company was to reduce labor costs on 51gauge hosiery and thereby enable the company to promote the sale of this product. This pro gram was successful, and over the 10-year period following the plan’s inception, hosiery sales in creased, wage rates were raised to a point which more than compensated for the decrease initially taken by the employees, and the plan was extended to knitters of non-run hosiery. At the peak of its coverage, however, the plan included only about 15 percent of the company’s employees. (2) Employment stabilization measures in the Columbia Conserve Co. were part of the broad general experiment of which the guarantee plan was a part. These measures included the em ployment of workers during the slack season upon the company’s 420-acre farm; production of nonseasonal soups and other products, such as chili con carne, chicken a la king, and bean sprouts; utilization of some of the workers as salesmen; and production for stock to a limited extent. The company’s business methods and the pros perity of the 1920’s resulted in a gradual increase in the number of covered workers, but substantial groups of employees recruited for the fall canning season always remained outside the coverage of the plan. In 1937, for instance, covered workers numbered 76 in June, and total employment in the plant was 102. During the September peak of that year, employment rose to 254, of whom only 74 were covered by the plan. (3) The Cleveland Fur Workers’ Union, Local No. 86 (CIO), has had contracts embodying employment guarantees with 19 local furriers since 1940. Prior to the introduction of the 38-weeks-a-year guarantees, most of these com panies tried in some manner to spread fur coat repair and restyling operations over the entire 8 or 9 month storage period; but a few firms, in cluding one of the largest and best known in the community, had taken no voluntary measures to stabilize employment and was able to provide only 3 or 4 months’ work a year. This company had engaged in extensive advertising campaigns to get furs into storage during April and May, a practice which resulted in intensive work during the months following, but in little work thereafter. The union determined to seek an employment guarantee in its contracts, in order to force the companies to provide steadier employment, and 45 for the sake of greater security the guarantee was also sought in contracts with the firms that were already providing stable employment. Under the contracts, the responsibility for spreading pro duction to stabilize employment was left entirely to management, the union believing that contract provisions would provide sufficient incentive to regularize. Management and union officials reported that employment had in fact been stabil ized under the plan. (4) A Wisconsin firm engaged in feed and flour milling inaugurated a guarantee of 52 weeks of employment in 1940. Management efforts were thereafter directed toward leveling out a seasonal slump in summer and early fall. Maintenance work was postponed until slack periods, and va cations granted at this time. New product lines were developed, such as turkey feed, peak demand for which occurs during the summer. At times during slack periods special sales measures were adopted to insure a steady flow of business: goods were shipped on consignment, prices were lowered, advertising was increased, and promotional pro grams developed. In fact, management reported that the chief benefit received from the guarantee had been the incentive to seek and accept new business during slack periods. (5) The basic features of the employment guar antee at Geo. A. Hormel & Co. were developed prior to its inauguration. However, measures to extend employment stability were devised as union and management became more familiar with the plan’s operation. Production quotas, of course, were subject to annual revision, reflecting changing conditions. It was found, for instance, that crews required to handle the peak work load in some departments could not be furnished suffi cient work to keep them busy 2,080 hours a year. Consequently, their annual hours were established at lower levels in the interest of providing steady employment. Careful determination of the crew sizes still did not entirely eliminate slack periods when there was insufficient work. Transfers were made to departments where peak work loads ex isted, but production in these departments did not increase in proportion to the number of men added. To avoid this practice, the firm made slight changes in equipment so that work could be transferred into slack departments. This proved to be a more efficient arrangement. A related measure was the establishment of an extra 46 GUARANTEED WAGE PLANS IN THE UNITED STATES gang as a reservoir of workers from which depart ments in need of extra help could draw. This extra gang constituted approximately 7 percent of total employment. Among other changes to improve productivity made during the operation of the guarantee was the establishment of a single rate in a department where the skills required for the various jobs were almost equal, but where a series of rates had pre viously existed. Under the former rate schedule, employees with greater seniority were able to claim higher-paying positions for which other workers were better fitted. Since the leveling of rates, the union has waived job selection rights based on seniority in this department and produc tivity has improved. The aggressive, enterprising actions of manage ment, reflected particularly in the introduction of many new products and the steady expansion of the company during the operation of the guaran tee, should not be overlooked as a factor contrib uting to the creation of more opportunities for stable employment. The guarantee of 52 equal pay checks per year stabilized not only workers’ income but also contributed to stabilizing the number of em ployees on the pay roll. Prior to installation of the guarantee, employment at the firm was marked by a high rate of labor turn-over, as workers drifted to other jobs during slack periods. The promise of steady income under the plan checked this practice; in 1939, 98 percent of all workers on the pay roll were continuously em ployed throughout the year. (6) The assured employment plan of the McCormick Co. has been in continuous operation since 1936. The company program to stabilize employment started in 1932 and has already been described. Following these measures, man agement in 1936 announced that 48 weeks of work would henceforth always be available to its em ployees. All competent and efficient employees with more than 6 months’ service were protected. No assurance was given those with less than 6 months’ service, and incompetence and ineffi ciency could still bring dismissal of any employee after a series of warnings. Neither wages nor hours of work were to be guaranteed. The company simply described its plan as one of intent to provide 52 weeks of work if at all possible, and if necessary to reduce the number of hours worked weekly in preference to reducing the em ployee’s weeks of work below 48 in the year. In actual practice, to fulfill the stated policy of the company, the management has produced for stock to the maximum capacity of storage facili ties, has transferred workers (at regular rates of pay) to maintenance and repair jobs, and has laid off temporary workers with less than 6 months’ service. At the same time management has been on the alert for new production possibili ties and has conducted further market research. (7) The basic regularization program of the National Battery Co. had already been developed in 1939 and 1940 when the company, at union request, introduced a program of stabilization of employment for workers with the greatest seniority status in its main and branch plants. The stabilization program was based chiefly upon the forecasting of demand and the main tenance of large inventory stocks of replacement batteries. The advent of the plan accelerated this program and effectively stabilized employ ment during the winter months, when demand for batteries was normally low. To an increasing degree, under the plan, production of batteries was consciously undertaken during the slack season with the objective of placing the company at all times in the position of being able to supply demand. This policy is reported to have resulted in substantial improvement in the company’s competitive and profit positions, as well as in the stabilization of employment. (8) The National Oats Co., one of the smaller of the Nation’s oatmeal processors, introduced a guarantee of 1,664 hours a year plus vacation to 3-year employees in 1936, together with a wage advance plan. Prior to inauguration of the plan no special efforts had been made to regularize production, and company officials felt that no particular risks were involved in guaranteeing the amounts of annual employment that they pro posed. Under the plan seasonal declines during the summer and at the end of the year continued, but the company had to pay for time not worked only in 2 years—in 1937 during the business recession, and in 1940. In neither year was the cost of such payment substantial. One step that the company did take under the plan’s operation to regularize production further was to start fall operation earlier than it had begun in the past, in an effort to level out the usual October peak. Another EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES was an effort to alleviate the secondary slack period in December, caused by wholesalers’ inventory reduction, by producing at this time orders which had to be shipped long distances, such as 2 to 3 weeks in the case of products shipped to Cali fornia. During year-end periods the plant has sometimes been run exclusively on export business. (9) When the Nunn-Bush plan was introduced the company had already stabilized month-tomonth employment variations to a substantial degree. The plan was expected to contribute to the stabilization of income rather than to the regularization of employment. During the reces sion of 1938, however, sales were not sufficient to warrant continuing the existing level of payments, and under the plan’s flexible arrangement wage or “ sharing” payments should have been reduced. Desiring to maintain employee income, however, management and labor agreed to produce for stock and to continue the existing level of pay ments. A sizable deficit was accumulated during this period, which was wiped out during the im mediately succeeding years. (10) In the Procter & Gamble Co., the major employment stabilization program undertaken also occurred prior to the initiation of the plan, in 1923. The chief instance of further employment regular ization under the guarantee occurred during the depression of the 1930’s. The company was able to continue its guarantee by production for stock, and by the transfer of workers to a labor pool from which they were assigned to a variety of main tenance and construction jobs. The company reports that it would be impossible to determine the costs of this program which could be specifi cally attributed to the guarantee, because much of the work would have been necessary in subsequent years, and the company would probably have undertaken some of the program as part of its general feeling of responsibility towards its em ployees in time of depression without the existence of a formal guarantee. (11) The minimum force agreement on the Sea board Air Line Railway inaugurated a new pro gram for spreading shop work throughout the year and for eliminating seasonal and irregular fluctuations in employment. This program suc cessfully eliminated much of the variation in operations. Whenever insufficient work threat ened the full-time employment of workers in minimum maintenance force positions, workers 47 not occupying minimum force positions were laid off, or the workweek was reduced. In cases in volving temporary or permanent close-downs of shop or terminal points, the total number of mini mum force positions for the year was maintained by transferring employees from one shop or point to another shop or point, at company expense if the transfer involved moving the worker and his family to another city. Work planning and budgeting under the plan eliminated completely sporadic shut-downs of individual shops that had previously characterized the company’s operations. (12) The guarantee of a small building materials manufacturing company, which operated under the provisions of Section 7 (b) (2) of the Fair Labor Standards Act from 1938 to 1943, stabilized employment opportunities for approximately 30 workers to a limited degree by giving them yearround jobs when they had in previous years been employed intermittently during slack winter months. Since the employees worked longer hours during the peak summer season under the plan to make up for time paid for but not worked during winter months, the principal effect of the plan was to average hours on an annual basis and to stabilize employee income throughout the year. The chief effects of the plans appear to have been adverse in three special situations: Where the employer introduced a guarantee to avoid over time premium payments, and the result was a cut in employees’ annual earnings; where the employer bargained away a wage increase with an offer of a guarantee of 24 hours’ work, and the employees found (a) that it gave them no increase in income and (b) that competing employers uniformly gave wage increases; and where the employer introduced a plan to avoid overtime payments, and employees who were paid at straight-time rates for overtime hours came to resent the scheme in contrast to payment of premium overtime rates to employees not covered by the guarantee. All three of these plans were discontinued. The plans were reported to have had little direct effect on volume of employment. Expan sion in business activity as a consequence of the incentive provided by a guarantee was reported in a few cases. These situations involved cases in which management generally followed an aggres sive policy, and the information obtained was in adequate to determine whether the plan or management initiative was the causal factor. 48 GUARANTEED WAGE PLANS IN THE UNITED STATES In a few cases, the plans were reported to have had the effect of curtailing temporary employ ment during peak seasons, giving the work instead to regular employees: This was the intention, for example, of a guarantee which operated from 1938 to 1943 in the plant of a small building materials man ufacturing company. Regular workers worked longer hours during peak summer months at straight-time pay in return for steady employ ment during the slack winter season. The two brewery plans studied guaranteed employment to “ regular card” employees of the company, while other employees bore the brunt of slack periods. Since this arrange ment had been a matter of union contract for over 40 years, the extent of its effect on the volume of temporary help previously em ployed cannot be estimated. Since many plans, especially those applying only to key workers, were reflections of past practice, temporary workers continued to be laid off. In a number of cases, expanding employment oppor tunities during the last decade have resulted in the absorption of former temporary workers and their coverage under the guarantees. In most of the cases, annual earnings of indi vidual employees increased while the plans were in operation. In several of these cases, management or union officials attributed increased earnings of workers with low seniority status, previously sub ject to periodic or intermittent lay-off, to the operation of the plans. The fact that payments of varying magnitude were made for time not worked in almost 40 percent of the cases supports these conclusions. It has been generally imprac ticable, however, to isolate the effects of the plans from the effects of improved business conditions, general wage increases, promotions, merit raises, and other factors, to obtain a more exact picture of the plans’ effects on earnings. 2. Other Accomplishments The conclusions of management and labor of ficials who had operated with guarantee plans, including some of those whose plans had been dis continued, were decidedly favorable. The major advantage reported— achievement of a sense of security— has already been cited. This meant, in terms of additional advantages cited by both management and union officials, better labor re lations, increased productivity in varying degrees, and improved union security. From manage ment’s point of view, the aid of the plans in re taining key employees or attracting the services of skilled workers constituted an important ad vantage in several cases. Related benefits were the frequently reported but difficult-to-demonstrate reduction in training costs, a reduction in turn-over, and the use of the guarantee as an at traction in the recruitment of employees. The achievements of several of the major plans have been cited in glowing terms by management officials involved: When questioned by a Bureau representa tive concerning the benefits of the plan in operation at the Nunn-Bush Shoe Co.’s Milwaukee plant, Henry L. Nunn replied* “ Any plan that will accomplish stabilized production means a saving in equipment and in overhead costs; and any plan that makes for better jobs and better-satisfied workers reduces the training costs. Our unemploy ment tax has been very small since under our system we do not have any unemployment. No worker has been laid off due to slack work since the plan started in 1935. Our labor turn-over in comparison with like industries in this vicinity has been exceedingly low. The type of employee in our factory is high class— above the average. The fact that the worker in this plant immediately profits through improved equipment and processes makes such improvements very acceptable. There is a consciousness of mutual profit in efficient production that makes for good morale. The employee not under the plan also enjoys the regularity of employment that the plan has given the business.” Richard R. Dupree, president of the Procter & Gamble Co., when describing his firm’s employment guarantee in a speech at the Conference on General Management of the American Management Association’ in October 1945, stated: “ * * * ffi our busi ness great strides have been made in ability to produce more units per man in the past 20 years. In fact, there has been a tremendous development along these lines that has been responsible for keeping costs down. We EXPERIENCE W IT H GUARANTEE PLANS IN SELECTED CASES found that once the plan was in effect, we had no trouble getting our people to experi ment and cooperate with us in working out important procedures of production—such as having, say four people on a line doing what five used to do— because each man knew that he was not going to lose his job if the experiment were successful.” He went on to stress another benefit accruing from opera tion of the plan: “ I would say that the steady employment plan is probably the greatest thing in our company, the greatest single factor— even greater than profit-sharing— in producing good relationships.” The effects of a guarantee upon hiring practices were mentioned by Fayette Sher man, employment manager at Geo. A. Hormell & Co. He said: “ There is the advantage of having a skilled crew on the job at all times. Customarily, when a gang is reduced the good men find other jobs and do not re turn, but the less desirable are back waiting to be hired. The guarantee eliminates the time, effort, and confusion, first, in deciding whether it is the proper time to reduce the gang, and, second, the confusion resulting from reducing the gang. Employment needs for the future can be estimated ahead of time and the per sonnel department given an opportunity to select new employees rather than ‘ hire at the gate’ when the production in some depart ments is to be increased.” Few employers reported disadvantages resulting from the plans. Costs were not regarded as dis advantages, but as necessary features of the guarantee, offset by compensating benefits. In the few cases where employers pointed out specific disadvantages, such as the heavy cost of ware housing incurred by the McCormick Co. and re luctance to accept new business which might prove to be temporary in the case of the NunnBush Co., they nevertheless considered the net value of the plan to be positive. In one-fourth of all the cases, the plans had been introduced at union behest, employers taking very little interest in them. In two-thirds of these cases, however, management reported that their experiences under the plans had been favorable, and that the plans had had a good effect on morale, turn-over, or efficiency. 49 In a number of the cases where management reported favorably upon experience under a guar anteed wage plan, the guarantee features of the plans had been very limited, either as to amount of the guarantee or as- to the proportions of plant workers covered. Management’s favorable reac tion in these cases was a reaction to the limited kinds of guarantee with which they had experi ence, and which they in many cases refused to characterize as “ guarantees” at all. In several cases, their reaction to what they considered to be a “ guaranteed wage plan” —formal guarantee of a full year’s employment or wages to all or virtu ally all of' their employees—was negative, hostile or skeptical. Union representatives and employees were, on the whole, greatly impressed with the security benefits which the plans had conferred, although many of them stated that the plans would prove to be more valuable during periods of depression than they had been thus far. About 40 percent of the union representatives interviewed indicated an in tention or desire to press for amendment of the plan to give more security— lowering of eligibility requirements, extension of coverage to other em ployees, increase in the amount of wages guaran teed, or an increase in the number of years’ em ployment covered by the guarantee. Their ap proach to the problem of improvement was a gradual one, but virtually all of them felt that the plans could be improved or extended without substantial risk. Management officials in several cases be lieved that the measures they had taken were capable of adoption by industry in general. A typical example of such opinion follows: William Cooper Procter, who introduced the guarantee of the Procter & Gamble Co., said in a statement shortly after the inaugura tion of the plan: “ I do not think there is any thing peculiar to the soap business that makes such a plan more adaptable to it than to any other industries. I believe that in the very great majority of industries the average annual consumption is approximately the same, without much fluctuation from year to year, and that the problem of providing for ■the distribution and warehousing is not a difficult one to work out if study is centered upon the special industry.” APPENDIX Basic data on 62 plans studied [The data in this table relate to the status of the plans early in 1946 Name of company and location Business activity Adelphi Paint & Color Works, Ozone Park, N. Y. M a n u f a c t u r in g paints and var nishes. (2) ...................................... Paper converters___ Union representation at any time during life of guarantee 1 United Gas, Coke & C hemical Workers of America, Local 121 (CIO). Paper Printing Spe cialties and Paper Converters (inde pendent.) (Not party to plan.) United Retail, Whole sale & Department Store Employees of America (CIO). None________________ Year of origin and discontinuation and eligibility re Basic provisions of guarantee Coveragequirements 1939. 48 hours per week, 48 weeks per year. 1937. 40 hours per week, 50 weeks per year. 1942. 40 hours’ employment per week, 52 weeks per year. Basic crew size determined by negotiation; coverage of individuals by seniority. First plan, 1931-32. Second plan, 1939. Wage advance obtained on request. Advance to equal difference between hours earned and hours assigned to class of workers as fol lows: Class I—40 hours; Class 11—50 hours; Class III—60 hours. No limit to wage advance for employ ees with 5 years of service. 52 weeks’ employment per year, based on 8-hour day and 40-hour week, at not less than negotiated week ly minimum wage. All employees. Employees must have 2 years, 3 months of service in order to qualify. Class I—Em ployee with no dependents; Class II—Employee with 1 dependent; Class III— Employee with more than 1 dependent. Production, shipping, and maintenance department workers with 6 months’ service. All plant employees with 1 year of service. (2) Selling buttons and buckles (whole sale) . (2) Manufacturing win dow and door frames. (2) Converters of textile fabrics. United Retail, Whole sale and Depart ment Store Employ ees of America (CIO). 1940. Barlow & Seelig Manu facturing Co., Ripon, Wis. M a n u fa c t u r in g washing machines. United Steelworkers of America, Local 1327 (CIO). 1940-42. $1,260 guaranteed for not more than 2,000 hours’ work. Operated under Section 7 (b) (2). Hourly paid employees. Service requirement: First contract, 1 year; Second contract, 5 years. ( 2) . Finishing textiles. Machine Printers’ Beneficial Assn. (Independent). 1939. Journeymen, printers, and apprentices. Berkshire Knitting Mills, Reading, Pa. Manufacturing ho siery. None. 1936. Full pay for any period in year prior to July 15 and half pay for any period after July 15, during which time worker is not em ployed. Operated under Section 7 (b) (2). 36 hours per week, 48 weeks per year. (2) Surfacing roads and driveways on a contract basis. Manufacturing dis tilled liquor. (2) cotton Cincinnati Gas & Elec tric Co., Cincinnati, Ohio. P r o d u c in g an d transmitting elec tric power and gas. Clark Sand & Gravel Co., Baltimore, M d. Operating gravel-pit and ready-mixedconcrete trucks. Colum bia Conserve Co., Inc., Indianap olis, Ind. Canning food prod ucts. See footnotes at end of table, p. 60. 50 do. Locals of unions. 8 AFL Int’l. Bro. of Electrical Workers of America, Local B-1347 (AFL); Independent Utili ties Union, Cincin nati, Ohio, United Mine Workers, Dis trict 50, Local 12049. None________________ Basic crew consisting of aver age number of nonexecu tive employees preceding union organization or re negotiation of agreement. Knitters on 51-gauge hose; toppers on 51-gauge hose; knitters (leggers) on 45gauge nonrun hose. No length-of-service require ment. Regular employees selected by company. 1926.... Full pay, 52 weeks per year. 1939-45. Weekly average of 40 hours’ employment per year. Hours not worked in short weeks debited against overtime. 40 hours’ employment per week, 52 weeks per year. Warehouse and powerhouse employees; service require ment 6 months. First plan—minimum week ly pay varying according to length of service for 52 weeks per year. Second lan—Minimum of 40 ours’ pay per week for 52 weeks per year. Hours paid for but not worked debited against overtime hours in excess ol 45 hours and less than 50 hours per week. Annual salary paid weekly with base rates adjusted according to marital sta tus and number of chil dren. Transit-mix drivers, bull dozer and crane operators, maintenance mechanics, office and supervisory staff. No length of service requirement. 1941. First plan, 1938-43. Second plan, 1945—. 1917-42. All regular full-time em ployees; service require ment, 6 months. All departments covered. Employees, to be eligible, must (1) have a year of service, i2) have an ex pectancy of 10 years of service, (3) be approved by vote of the employees’ council. A by the Bureau of Labor Statistics Changes which may have occurred since that time have not been incorporated] percent number Approximate Safeguards and escape clauses Approximate of total workers Basic reasons for introduction of workers covered covered Employer’s obligation ceases if sales drop below 80 per cent of previous year. 40. 90 percent. Termination at discretion of management. Firm spe cifically reserves right to lay off for lack of work. 35. 85 percent. Size of basic crew may be re duced by negotiation with union upon permanent cur tailment of the business. Termination at discretion of management. 30. Reduction in size of basic crew subject to union negotiation upon presentation of evidence showing need for crew of lesser size. If no agreement, may go to arbitration. Plan may be suspended by strikes, disasters, act of God. Initiated b y - Has company paid for time not worked? To obtain security after ex perience of depression. To offer more than unemploy ment compensation. To provide security and thereby avoid slow-downs before seasonal lay-offs. Joint initiation by union and man agement. No. Management_______ No. 70 percent. To obtain security for basic crew. Union. No. 350. 90 percent. To assure employees greater stability of income. Management. Wages advanced under original plan. 650 in 1945; 1,300 in 1941. Not available. To obtain security for basic crew. Union. No. 247. 85 percent. Joint initiation by union and man agement. No. None. 11. 3 percent. To assure stability of employ ment and earnings. To ob tain exemption from over time payments under Sec tion 7 (b) (2) of Fair Labor Standards Act. Desire to increase job security. Union. Yes. Plan may be suspended by causes beyond company con trol, Government order, or lack of raw materials. Number of workers in covered occupations has grown steadily from 85 to 420 dur ing life of guarantee. Currently, 15 percent To obtain security; to reduce cost of 51-gage hose; to re duce turn-over of knitters. Employee proposaL. No. Termination at discretion of management. 8__ . None_________________________ 300. 100 percent in slack To hold trained employees. Management. season; about 30 per cent in peak season. 35 percent-..................... To save overtime pay and to ____ do_______ give additional security. Company guarantee subject to its right to lay off for “ lack of work or for other proper and legitimate reason.” 2,500.. 100 percent. Stabilization program of com pany had been successful and plan was offered to pro mote security and industrial relations. do. No. Plan is terminated upon dis continuation of business. 44. 100 percent in slack, 60 percent in peak. To hold trained personnel. do. Yes. Plan may be modified by em ployees’ council action. Coverage varied from year to year—76 in June 1937,49 in June 1942. Proportion varied sea sonally—75 percent in June 1937, 30 percent in Septem ber 1937. Guarantee integral part of plan for cooperatively man aged establishment. do. Yes. Yes. Yes. 51 52 GUARANTEED WAGE PLANS IN THE UNITED STATES Basic data on 62 plans studied [The data in this table relate to the status of the plans early in 1946 Name of company and location Business activity Union representation at any time during life of guarantee 1 Year of origin and discontinuation Crocker-McElwain Co. and affiliated Chemi cal Paper Manufac turing Co., Holyoke, Mass. Manufacturing pa per. Int’l Bro. of Paper M a k e r s , E a g le Lodge 1 (A F L ). 1921-36. Cromwell Silver Manu facturing Co., Long Island City, N . Y . Manufacturing sil verware. United Electrical, Ra dio & Machine Workers of America, Local 1225 (CIO). Int’l Chemical Work ers Union (AFL). (Not party to plan.) January 1939-December 1939. (3) ------------------------- M a n u fa c tu r in g chemicals and fer tilizers. Decatur Newspapers, Inc., Decatur, 111. Publishing newspa pers. Detroit & Cleveland Navigation Co., De troit, Mich. Operating Great Lakes passenger and freight steam ers. (2). Milling flour. I. J. Fox, Inc., Cleve land, Ohio Storing and repair ing furs Fur Merchants Em ployers Council, New York, N . Y . Fur dealers________ The Furniture Special ties Corp., New York, N. Y. Manufacturing up holstered f u r n i ture. Gates Rubber Co., Denver, Colo. M a n u f a c t u r in g mechanical rub ber goods. (2) M a n u f a c t u r in g electrical appara tus. feed See footnotes at end of table, p. 60. and Int’l Typographical Union, Decatur T y pographical Union N o .15 (AFL), Int’l. Printing Pressmen & Assistants’ Union of North America, and Decatur Print ing Pressmen and Assistants’ Union No. 161 (AFL). Masters, Mates & Pilots of America, Locals 47 and 5 (AFL), Nat’l Ma rine Engineers’ Ben eficial Ass’n Local 3 (CIO); Int’l Long shoremen’s Ass’n, Locals 1324, 1654, and 1326 (AFL). Cereal W orkers’ Union (AFL). 1939-40- Printers, 1939-41. Pressmen, 1938—. Masters and mates, 1919—; p u r s e r s , 1941—; stewards, 1941—; engineers, 1937—; checkers, De troit, 1941-46; check ers, Buffalo, 1938-46; dock foremen and clerks, Buffalo 194146. 1940. Cleveland Fur Work- ___ d0. ers Union, Local 86 (CIO). Int’l Fur & Leather 1938... W orkers’ U nion, Local 64 (CIO). U pholsterers I n t ’ l U n io n of N o r th America, Local 44 (AFL). U n ite d R u b b er Workers of Amer ica, Local 54 (CIO). (Not party to plan.) None. and eligibility re Basic provisions of guarantee Coveragequirements 52 full weeks’ pay per year, originally; in 1931, reduced to 80 percent of full pay for 44 weeks per year; in 1932, further reduced to 50 percent of full pay for 44 weeks. 40 hours for 45 weeks, and 3 days per week for 6 weeks. Production, shipping and maintenance employees. 5 years’ service require ment. Must be recom mended by 2 covered em ployees and by supervisors and accepted by company. 61 listed employees in pro duction department. Wage advance when weekly All hourly rated employees. wage fell below 30 hours Service re q u ire m e n t, per week, equal to the dif 3 years. ference between earnings and 30 hours’ pay, up to a maximum of 175 hours’ pay. The printers’ plan operated Printers, pressmen, and under section 7 (b) (2) stereotypeis. No lengthfrom 1939-41. Printers of-service requirement. received 40 hours’ pay per Must be union members. week with overtime offset by short weeks. Press mens’ plan has operated under Section 7 (b) (2) since 1946. Pressmen re ceived 40 hours’ work per week. Masters, 12 calendar months3, Masters, mates, pursers, mates, 10 calendar months;3 s te w a rd s, e n gin eers, purser, from 3 to 8 months,3 checkers, and other speci varying according to ship fied occupations. or home port; engineers, 10 calendar months; 3 check ers, 9 months’ continuous work, 8 hours per day, 6 days per week; foremen and clerks in Buffalo, fixed monthly salary 12 months per year; seasonal workers in Buffalo, fixed monthly salary during “ season of navigation.” 48 hours’ employment per The 75 percent of hourly week, 52 weeks per year. employees who have the greatest seniority are cov ered. 35 hours per week, 38 weeks Fur machine operators, cut per year. ters, fur nailers, and hand sewers. 40 hours’ pay per week. No All employees other than covered worker may be scrapers, temporary work laid off. ers, and those employees earning over $51.50 per week. Service require ment, 6 months. 1938-40. Minimum of 24 hours of work per week, 52 weeks per year. Upholsterers. 1938-39. After 1 year of service, 1,600 hours per year; after 2 years of service, 1,700 hours; after 3 years of service, 1,800 hours. All production and service occupations. Service re quirement, 1 year. 1931-38. 1,500 hours per year. Production, shipping, and maintenance employees. Service requirement, 1 year. 53 APPENDIX A.---- BASIC DATA ON PLANS STUDIED BY BLS by the Bureau o f Labor Statistics— Continued Changes which may have occurred since that time have not been incorporated] Safeguards and escape clauses Approximate number of workers covered Approximate percent of total workers covered Company reserves right to terminate agreement under conditions which in opinion of company make it power less to continue it, upon giv ing 4 weeks’ notice. 1921—80; 1931—120; 1932—125; 1937—165. 1921—50 percent; 1931 —65 percent; 1932— 75 percent; 1937—85 precent. None___________________ _____ 60 Plan may be modified at discre tion of management. 400________________ . . . Plan may be discontinued if publication is suspended by act of God, strike, riot, civil commotion, acts of civil or military authorities, or other causes beyond the control of union or publisher. Has company paid for time not worked? Basic reasons for introduction Initiated by— To provide stability of earn ings; to help maintain an open shop. Management______ Yes. Served as a compromise in lieu of wage increase during contract negotiations. Joint initiation by union and man agement. No. 88percent___________ Suggested by union as means of providing increased sta bility of employee income. Union Wages advanced. Total number of print ers and pressmen— 46, in 1941; 13, in 1946. 26 percent, in 1941; 7 percent, in 1946. To keep qualified workers for peak requirements; to in crease productivity. M anagement_____ Yes. Company may discontinue services of masters, mates, stewards, and engineers in the event of a major marine disaster, condemnation of a ship, or commandeering by governmental authority. Total covered employ ees fluctuate through out year, owing to varying lengths of different guarantees. Average figure is about 100. Percentage covered varies from about 40 percent in slack period to 7 percent in peak. To obtain income stability; on company’s part, to retain licensed and trained em ployees. Union____________ Yes. None__________________________ Not available _ __ 75 percent ______ To improve labor relations and employee morale. Management_______ Yes. To increase stability of em ployment. Union. _____ _______ Yes. ____ do. _______________________ 13 Status of regular employee may be changed in the event of the merger or liquidation of business, subject, however, to decision of arbitrator. In case of seriously adverse busi ness conditions requiring re duction in personnel, union agrees it would not unreason ably withhold consent to re duction. Employee may be replaced by another on July 1 of each year. _____________________ None Company reserves right of lay off in event of curtailed oper ation caused by war, act of God, casualty, labor trou bles, expropriation of plant or part thereof, lack of mate rials, delay in transporta tion, or any other like cause beyond company’s control. Company reserved right to modify, revise, or extend plan. _________________ . ____ 20percent___ __ _ ________ 165___________________ 50 percent____________ To improve morale and labor ____ do....... .................. No. relations. 12____ _______________ 80 percent...................... Compromise offer during con tract negotiations. 1,375 ................. 75 percent To improve employer-em ........ do___ ______ __ ployee relations; to provide greater security. No. 7,000 _______ ____ 65 percent To provide stability of earn ____ do......................... ings. Stabilized operations made plan feasible. Yes. _ . ....... Management_______ No. 54 GUARANTEED WAGE PLANS IN THE UNITED STATES Basic data on 62 plans studied [The data in this table relate to the status of the plans early in 1946. Union representation at any time during life of guarantee 1 Year of origin and discontinuation Name of company and location Business activity General Motors Corp., Detroit, Mich. Manufacturing au tomobiles. United Automobile Workers of America (CIO). (Not party to plan.) M a n u f a c t u r in g men’s and boys’ apparel. Amalgamated Cloth- 1937. ing Workers of A m erica ( C I O ) . (Not party to plan.) N one.............................. 1939. <2) .......................................................................................— Good Humor Ice Cream Co., Baltimore, M d. Manufacturing cream. Grand Rapids Whole sale Grocery Co., Grand Rapids, Mich. Selling groceries (wholesale). Greenville Finishing Co., Greenville, R . I. D yeing, printing, and finishing tex tiles. Geo. A. Hormel & Co., Austin, Minn. Meat packing.. United Packinghouse Workers of America, Local 9 (CIO}. (2) Automobile srles and service. United Automobile Workers of America (CIO). 1940. None. 1942. do The George A. Lewis Co., Danbury, Conn. ( 2) ----------------------------------------- ( 2) ----------------------------------------McCormick & Co., Inc., Baltimore, M d. ice 1939-41. Int’l Bro. of Team sters, Chauffeurs, Warehousemen & Helpers of America, Local 406 (AFL). (Not party to plan.) M achin e p rin te rs’ Beneficial A ss’ n. (Independent). Selling costume jew elry (wholesale). United Retail, Whole sale & Department Store Employees of America (CIO). Manufacturing soap. United Soap Workers, Local 366 (CIO). Manufacturing food None.______ _________ specialties. (2) G enerating and transmitting elec tric power. T h e N am m Store, Brooklyn, N . Y . Department store. See footnotes at end of tabic, p. 60*. Brotherhood of Util ity Workers of New England (Independ ent). None__................... ...... and eligibility re Basic provisions of guarantee Coveragequirements Income security plan— Wage advance to em ployee earning less than 60 percent of standard weekly earnings, equal to the difference between his earnings and 60 percent of the standard week, up to a limit of 360 hours’ pay. Lay-off benefit plan—Wage advance to employee earn ing less than 40 percent of standard weekly earnings, equal to the difference be tween earnings and 40 percent of the standard week, up to a maximum of 72 hours’ pay. 52 weeks’ salary, number of hours varying according to job classification. Income security plan— Hourly rated employees under 64 years who had completed 5 years of serv ice and had worked for the company during a given month designated by the president. Lay-off benefit plan— Hourly employees under 64 years not eligible under income security plan with 2 years’ service and who had worked during desig nated month. Employ ees failing to work be cause of sickness are eligible. Specified job classification and selected key employ- 48 hours per week from October to March (slack period). Key employees of all de partments, including sales and office, selected in October of each year. Warehousemen, dockmen, and drivers. 1919__________________ 47 hours’ employment per week, 52 weeks per year. 1940. — L ap sed 8 months in 1942, 13 months 1943-44, dur ing which periods guarantee of half pay for any 13 weeks during the year in which workers were idle was in effect. 1931____ _____________ Annual wage, payable in 52 weekly installments; fluctuating work week. Under Section 7 (b) (2). Journeymen printers, upon hiring. 52 weeks’ employment per year. Average workweek varies from 34 to 40 hours. Under Section 7 (b) (2). All employees exclusive of part-timers, extras, or em ployees hired for a specific temporary period are cov ered as soon as hired. Mechanics and porters listed by name. 52 full weeks’ work per year. Workweek for me chanics is 40 hours; for por ters, 44. 52 weeks’ minimum wage per year. Mechanics and body repair men covered upon being hired. Basic crew covered. Vacan cies in crew filled on basis of seniority. 1940— No lay-off for 52 weeks. W orkweek is 40 hours. 1942— . 52 full weeks’ employment per year. Assurance of 48 weeks’ em ployment per year with intent but no guarantee to provide 40 hours’ work per week. 2,000 hours’ employment per year. Under Section 7 (b) (2). Firemen and watchmen after 30 days’ service. All efficient and competent plant and office workers after 6 months’ service. 52 weeks’ employment for those with more than 5 years’ service; 48 weeks, 3 to less that 5 years; 44 weeks, 1 % to less than 3 years; 40 weeks, 1 to less than l ] 4 years. Em ployees may be transferred to part time (28 hours per week) on seniority basis. All regular nonexecutive workers on pay roll after 1year’s service. 1936.... 1940-41. 1939-43. All employees except office workers, upon hiring. 55 APPENDIX A.---- BASIC DATA ON PLANS STUDIED BY BLS by the Bureau o f Labor Statistics— Continued Changes which may have occurred since that time have not been incorporated] percent number Approximate Safeguards and escape clauses Approximate of total workers Basic reasons for introduction of workers covered covered Initiated b y - Has company paid for time not worked? Corporation may modify or suspend plans in event of fire, floods, wars, riots, or labor disputes in any plant of corporation or suppliers, or for circumstances beyond control of management, or in case of change through legis lation or otherwise in stand ard workweek. 156,000. 60 percent. To assist employees during periods of short employ ment or no employment, and to avoid difficulties in volved in cash loans. Plan may be canceled, revised, or extended at will of em ployer. 10. 50 percent. To hold trained employees. do. No. Company may terminate plan at time it desires. 40. 100 percent To hold key employees. do. Yes. Company may revise or ter minate at any time. 32. 67 percent. To attract steady, reliable workers. do. Yes. 3 percent. Union desired security; man agement accepted plan to receive benefits of Section 7 (b) (2). Union. Yes. None. in slack period, 35 percent in peak. -Management. Wages advanced. .do. 3,900. 80 percent. Management wished to stabil ize workers’ income and reduce turn-over. Management. Yes. do. 13. 60 percent. Union demand substituted in lieu of a denied wage in crease. Union_______ No. 11. 39 percent. To retain trained workers. Management. No. 55. 73 percent . To assure security for basic crew. Union No. Management may modify, revise, or cancel plan at any time. Employees may be laid off 1 week if business drops 10 per cent below stipulated level. 12 . 3 percent-.. 575. 100percent. Demonstration of union ____ do_______ strength. To increase stability of income Management and employment. No. Senior board of directors may modify, revise, or cancel plan at any time. None. 125. 91 percent. To secure overtime exemp tions of Section 7 (b) (2). do: No. 920. 67 percent. To provide additional employ ment security. .do. No. None. .do. No. 56 GUARANTEED WAGE PLANS IN THE UNITED STATES Basic data on 62 plans studied [The data in this table relate to the status of the plans early in 1946. Name of company and location Business activity National Battery Co., St. Paul, Minn. Manufacturing bat teries. National Oats Co., Cedar Rapids, Iowa. M anufacturing cere als. (2) Limited price vari ety store chain. Union representation at any time during life of guarantee 1 Year of origin and discontinuation Employees in firm’s plants covered by various locals of Int’l Bro. of Elec tr i c a l W o r k e r s (AFL); Int’l Bro. of Teamsters (AFL); Int’l Ass’n of M a chinists (AFL); and United Automobile, Aircraft & Agricul tural Implement Workers of America (CIO): Federal La bor Union 23619 (AFL). American Federation of Grain Processors Council (AFL). 1940. United Retail, Wholesale & Department Store Employees of America (CIO) cov ers 30 Detroit stores. In t’l P r o t e c t i v e Ass’n (AFL) covers 1Racine, Wis., store. Remainder of chain is nonunion. Industrial Union of Master Craftsmen; Nunn-Bush Office Employees Union; Nunn-Bush Ship ping Department Union. 40 hours’ work each week except those during which inventory is taken or an unworked holiday oc curs, at which times the workweek is 32 hours. All plant workers. Lengthof-service requirem ent varies in the different plants from 49 to 90 days’ service. 1,664 hours of employment per year, plus paid vacation. All plant employees with 3 years’ service, 1938. 42 full-time weeks (not to exceed 48 hours per week) and 10 36-hour weeks of employment per year. Sales and office employees with 1 year’s service. 1935. Management sets aside an Wagesofall workersnot sub agreed percentage of the ject to lay-off and all other value of production as employees with 2 years’ labor’s share. There is service are determined on established for each cover the basis of their participa ed employee a drawing tion in the Share-the-Proaccount based on his esti duction Fund. mated annual income, H 2 of which is to be with drawn weekly from the fund representing labor’s share of the production. Adjustment with actual earnings is made periodi cally. The 595 workers in the production depart ments with greatest senior ity and the 70 percent of office and shipping depart ment workers with great est seniority are not sub ject to lay-off. Employees are not to be All nonexecutive employees, except office workers and laid-off more than 20 days drivers, who have re per year. ceived “ regular card” from union. Nunn-Bush Shoe Co., Milwaukee, Wis. M a n u f a c t u r in g men’s shoes. (2) Brewing and distrib uting beer. Int’l Union of United Brewery, Flour,'Ce real, and Soft Drink Workers of America. About 1890. Parker Manufacturing Co., Worcester 1, Mass. ( 2) ------------------------------------- M anufacturing hand tools. None. 1938. Brewing and distrib uting beer. Int’l Union of United About 1890Brewery, Flour, Ce real, and Soft Drink Workers of America. Procter & Gamble Co., Cincinnati, Ohio. Manufacturing soap. Ivory dale and St. Bernard Employees’ Representat ion A s s ’ n (independ ent) in the Cincin nati area. Various unions are involved at the other plants. (Not party to plan.) See footnotes at end of table, p. 60. and eligibility re Basic provisions of guarantee Coveragequirements 1923. 1,800 hours’ pay annually__ All plant and office employ ees with 5 years’ service. 5 days of 8 hours’ work per week during busy season (Apr. 15-Oct. 15) and 4 days of 8 hours work per week during the other 6 months’ (dull season). Employment for 48 full weeks (or time equivalent) per year. All workers except office and maintenance employ ees who have been desig nated as “ bookmen” by union. All hourly employees with 2years’ service. 57 APPENDIX A.---- BASIC DATA ON PLANS STUDIED BY BLS b y th e B u rea u o f L a b o r S ta tistic s — Continued Changes which may have occurred, since that time have not been incorporated] Safeguards and escape clauses Management may lay off employees according to seniority at any time, upon giving 5 days’ notice. percent Approximate number Approximate of total workers Basic reasons for introduction of workers covered covered 1,450 (on list), Time lost because of shut-down 50___ of mill caused by fires, strikes, riots, tornadoes, cyclones, ex plosions, floods, military or civil commotion, or other causes beyond control is de ducted from guarantee period. None.............................................. 2,385. do. Covered workers’ employ ment may be terminated, other than for cause, only if plant shuts down or output is affected by act of God, fire, explosion, or other cause be yond firm’s control. Management may modify, re vise, or cancel plan at any time. In severe slack period, manage ment may reduce workweek to 3 days per week by agree ment with union. If business ceases, plan is terminated. Workweek may be reduced to 75 percent of normal at man agement option, or firm may withdraw guarantee at any time. seniority 75 percent 35 percent. To provide employment se curity. .do. Initiated by— Has company paid for time not worked? Union. No. Management.. Yes. .do. No. 44 percent. To attract employees and im prove labor relations. 615. 66percent.. To provide income security. 100. 59 percent. To provide security for top seniority workers. Union. Yes. 75.. 33 percent. Granted primarily as a reward for long service. Management, No. 210. 57 percent. To provide security for top seniority workers. Union_______ Yes. 3,800. 49 percent. To provide security. Management. No. ____ do____ During 1937-38 re cession, the firm produced in ex cess of demand in order to main tain the level of employee earnnings, thus, in effect, advancing employment ra ther than 58 GUARANTEED WAGE PLANS IN THE UNITED STATES Basic data on 62 plans studied [The data in this table relate to the status of the plans early in 1946. Name of company and location Business activity Union representation at any time during life of guarantee 1 Year of origin and discontinuation (2) Manufacturing cere als. Food, Tobacco, Agri cultural & Allied Workers Union of America (CIO). 1934. (2) W om en’s apparel United Retail, Whole retail store (chain). sale & Department Store Employees of America (CIO). 1936. Retail and Wholesale Shoe Stores, New York, N . Y . Retail and wholesale shoe stores. United Retail, Whole sale & Department Store Employees of America, Locals 1268 and 287 (CIO). 1936. (2) Manufacturing w o m e n ’ s and misses’ dresses. International Ladies’ Garment Workers’ Union (AFL). 1937. Richmond Piece Dye Works, Inc., R ich mond Va. Dyeing and finish ing textiles. T e x t i l e Wo r k e r s Union of America, Local 27 (CIO). 1940. (2) Manufacturing sil verware. None. 1936-42. Seaboard Air Line Rail way Co.4. Norfolk, Va. Railroad Railway Employes’ 1928. Department, Sys tem Federation No. 39 (AFL). ( 2) Mail order store. (2) retail and eligibility re Basic provisions of guarantee Coveragequirements 140 hours of employment per month while on pay roll. If laid off, em ployees receive 70 hours’ pay per month for periods varying according to length of service: 6 months to less than 1 year’s service—2 months per year; 1 year to less than 2 years’ service— 3 months per year; 2 years to less than 3 years’ serv ice—4 months per year; 3 years and over—6 months per year. 11 months’ employment per year for “ steady employ ees,” 35 weeks’ employ ment per year for “ steady extra employees.” Full-time workers guaran teed 52 44-hour weeks’ employment per year, part-time workers guaran teed employment for 3 full days or 3 nights and Satur day each week, 52 weeks per year. 1,800 hours of employment, exclusive of overtime, per year. All plant employees with 6 months’ service. Minimum of $18 per week guaranteed to males and minimum of $15 per week guaranteed to females, for duration of union contract. Full week’s pay guaranteed for 52 48-hour weeks per year. Employment for 52 48-hour weeks per year. All union employees with at least 1 year’s service All members of the union upon hiring. The union covers only sales clerks. All nonexecutive store em ployees after 2 weeks’ pro bationary period. All members of the base crew, in which vacancies are filled by election of union and management from plant work force. Journeyman and apprentice silversmiths, upon hiring. Maintenance workers in cluded on basis of sen iority in “ m i n i m u m force.” size of which is ne gotiated each year by company and union. None. 1936. Wage advance—employees receive 40 hours’ pay 52 weeks per year. All mail order employees with 24 weeks’ service who have worked 480 hours. Manufacturing women’s coats. Int’l. Ladies’ Garment Worke rs ’ Union (AFL). 1939. 35 hours’ employment guar anteed for 50 weeks per year. Spiegel, Inc., Chicago, Mail order store. None. 1939. Males guaranteed 40 hours’ employment 52 weeks per year; females, 36 hours’ employment 52 weeks per year. All cutters, sewing machine operators, finishers, and pressers after 1-week probationary period. All employees except up holsterers, finishers, and cabinet makers, after 1 A years’ service and 3,000 hours’ actual work. The Tremco Manu facturing Co., Cleve land, Ohio. Uneeda Cleaning & Dyeing Co., Inc., Hillside, N . J. M anufacturing paints, varnishes, and lacquers. Cleaning and dye ing apparel. Tremco Employees’ Association (Inde pendent) . 1938-43. 40 hours’ pay for 52 weeks per year. Operates under Section 7 (b) (2). 40 hours’ pay for 52 weeks per year. (2) M anufacturing baby carriages. None 111. See footnotes at end of table, p. 60. retail 1918___ 1938-42. 1,760 hours’ employment per year, plus paid vacation. All production employees, upon hiring. Spotters, washers, dry cleaners, examiners, solici tors, drivers, cleaners, steamers, skilled tumbler men, upon hiring. All employees (except sales men) with 1 year’s service. 59 APPENDIX A.— BASIC DATA ON PLANS STUDIED BY BLS b y th e B u rea u o f L a bor S ta tistic s — Continued Changes which may have occurred since that time have not been incorporated] Approximate percent of total workers covered Basic reasons for introduction None____ _____________________ 945 78 percent-___ ______ To insure income during lay offs. Liquidation of firm or depart ment cancels obligation to affected workers. 22 34 percent________ ____ To provide security for basic crew. None. 2,500 Not available. Safeguards and escape clauses _____________________ Approximate number of workers covered Management may withdraw the guarantee in the event of a garnishment, wage as signment, or other legal process. Plan may be ter minated by decision of the board of directors. None _______________ do Has company paid for time not worked? __ _ Yes. Union_____ ___ _ _ No. ____ do______________ ___________ Yes. No. 84 percent-__ ________ To grant income stability and reduce turn-over. Management union. and Yes. 22 100 percent— ________ To attracted skilled workers. Management_______ Yes. 2 300 11 percent,______ _ - To increase security; to elimi nate extreme fluctuations in employment. Union______________ No. lf> 000 38 percent- _ ________ To provide stable income. Management___ W a ges 45 63 percent. __________ To stabilize employment; to ____ do______________ secure wage reduction. 3,400 65 percent.................. . To improve employee rela ____ do____________ 1tions; to stabilize employ ment. Yes. 25 percent____________ ____ do______________ No. 32 percent___________ ____ do________________________ U nion--.._________ No. 62 percent. ............... . _ To reduce absenteeism and large volume of wage gar nishments. Management_______ No. 30 32 Management may cancel guar 150 antee if act of God or other condition beyond firm’s con trol makes it necessary. 1 To provide security. Management 51 percent______ _____ Proposed by union when wage ____ do demand was only partially met. Management may withdraw 500 guarantee upon granting 5 percent general increase. Time lost during shut-down due to fire, tornado, explo sion, or other cause beyond control deducted from guar antee. Plan is terminated if business is discontinued. None__________________________ 180 Management may modify, re vise, or cancel plan at any time. Each party has right to initiate review of number in mini mum work force any time after Jan. 31. If situation ari ses which would seriously af fect either party, a conference must be held between man agement and union com mittee. If agreement is not reached, either party may cancel contract by giving 10 days’ written notice. Management may modify, re vise, or cancel plan at any time or may terminate any individual’s employment at any time. None - ___________________ _____ Initiated by— ____ To provide security. No. advanced. 60 GUARANTEED WAGE PLANS IN THE UNITED STATES Basic data on 62 plans studied [The data in this table relate to the status of the plans early in 1946. Name of company and location Business activity Western States Enve lope Co., Milwaukee 4, Wis. Manufacturing envelopes. Union representation at any time during life of guarantee 1 Year of origin and discontinuation and eligibility re Basic provisions of guarantee Coveragequirements Employees’ Representative Commit tee (Independent). None________________ 1937_. 35 hours’ employment for 52 weeks per year. All employees with 5 years' service. 1938.. 40 hours’ employment, 52 weeks per year. All employees (except parttime workers) with 6 months’ service. All employees with 5 years’ service prior to Dec. 15 of the year preceding date contract takes effect. (?)------------------- Men's retail cloth ing store. Wisconsin Public Serv ice Corp„ Milwaukee, Wis. P r o d u c i n g and transmitting elec tric power and gas; operating mo tor and bus carri ers. Int’l Union of Operat ing Engineers, Local 310 (AFL). 1937. . 40 hours’ employment, 52 weeks per year, for a 2year period. Wm. Wrigley, Jr., Co., Chicago, 111. Manufacturing chew ing gum. None.. 1934. U nem ploym ent benefits All employees with 6 months’ paid during lay-offs for service. periods varying, accord ing to length of service, from 1 to 7 months per year for monthly employ ees and from 4 to 30 weeks per year for hourly em ployees. Payments are made on the following basis: Monthly employees receiv ing $100 or less per month —80 percent of base rate; receiving more than $100 and not more than $200— $80 plus 60 percent of differ ence between base rate and $100; receiving more than $200 and not more than $300—$140 plus 40 percent of difference be tween base rate and $200; receiving more than $300 and not more than $400— $180 plus 20 percent of dif ference between base rate and $300; receiving more than $400 and not more than $500—$200 plus 10 percent of difference be tween base rate and $400. Hourly employees receiving 58 cents or less per hour— 80 percent of base pay; re ceiving more than 58 cents and not more than $1.16 per hour—$18.56 plus 60 percent of difference be tween base rate and $1.16; receiving more than $1.16 per hour—$32.48 plus 40 percent of difference be tween $1.16 and base rate. 1 In cases where representation of the workers changed during the life of the guarantee, only the most recent situation is reported. In the following cases, representation changed during the life of the plan: Employees of the Cincinnati Gas & Electric Co. were represented only by the independent utilities union at the time the plan was inaugurated; the A FL and CIO locals were organized later. The union representing Crocker-McElwain employees at the time a guarantee was proposed lost its bargaining rights shortly thereafter. The union at Gates Rubber Co. was organized after the establishment of the guarantee, which is not a part of the union agreement. Workers of Grand Rapids Wholesale Grocery were organized after the guarantee was begun. At the time the Hormel plan was started, workers were represented by an independ ent union which later affiliated with the United Packinghouse Workers of America (CIO). 2 Identification withheld at request of company or union. 3 Calendar month—30 workdays per month, 8 hours per day. * Seaboard Air Line Railroad Co. since Aug. 1, 1946. APPENDIX A.---- BASIC DATA ON PLANS STUDIED BY BLS 61 b y th e B u rea u o f L a bor S ta tistic s — Continued Changes which may have occurred since that time have not been incorporated] Has company paid for time not worked? Approximate number of workers covered Approximate percent of total workers covered Basic reasons for introduction Management may withdraw guarantee if raw materials are unavailable. M ay be canceled at management’s option. 40. 60 percent. To provide security. Management. No. 25. 77 percent . To improve relations. ____do_______ No. Workers may be transferred from departments where op erations have been curtailed or discontinued, to other de partments at a reduced wage to work out balance of 2-year period. Employee is paid difference between his new wage and his previously established wage for a period of 6 months. In the event conditions of busi ness or acts beyond manage ment’s control do not permit restoration of laid-off employ ees to work, management may terminate the guaran tee for such employees. 700. Safeguards and escape clauses 2, 000. do. 100 percent. Initiated b y - To provide security. do. No. To provide income security. do. Yes. Appendix B.—Clauses Used in Guarantee Plans and Contracts Sample Guarantee Provisions The following compilation of guarantee clauses found in union agreements or written descriptions of guarantee plans is intended for the guidance of management and union officials who may wish to draw upon the experience of others in framing the language of a guaranteed wage or employ ment plan, or incorporating a guarantee provision in a collective bargaining contract. The clauses cover a wide variety of examples and are classified in categories which are descriptive of the basic features of the plans analyzed in the Bureau of Labor Statistics survey. A cross-reference index, of the plan clauses, by industry, will be found at the end of this appendix (p. 89). Included in these classifications are clauses illustrative of guarantees for periods ranging from 3 months to a full year and varying in cover age from a specified number of workers or occu pations to all (nonexecutive) employees. The clauses have also been selected to exem plify variations in employee eligibility require ments (where they exist) and the range of con ditions (if any) which permit modification or suspension of the guarantee. C ATE G OR IES IN T O W H IC H GUARANTEE PR OVISIONS HAVE B E E N C LASSIFIED I. A full year’s guarantee to all (nonexecutive) em ployees. A. Plans with employee eligibility requirement: 1. With provision for modification or abro gation of plan. 2. Without provision for modification or abrogation of plan. B. Plans without employee eligibility requirement: 1. With provision for modification or abro gation of plan. 2. Without provision for modification or abrogation of plan. II. Less than a year’s guarantee to all (nonexecutive) employees. A. Plans with employee eligibility requirement. 1. With provision for modification or abroga tion of plan. 62 2. Without provision for modification or abrogation of plan. B. Plans without employee eligibility requirement. 1. With provision for modification or abroga tion of plan. 2. Without provision for modification or abrogation of plan. III. A full year’s guarantee to part of the working force. A. Plans with employee eligibility requirement. 1. With provision for modification or abroga tion of plan. 2. Without provision for modification or abrogation of plan. B. Plans without employee eligibility requirement. 1. With provision for modification or abroga tion of plan. 2. Without provision for modification or abrogation of plan. IV. Less than a year’s guarantee to part of the working force. A. Plans with employee eligibility requirement. 1. With provision for modification or abroga tion of plan. 2. Without provision for modification or abrogation of plan. B. Plans without employee eligibility requirement. 1. With provision for modification or abroga tion of plan. 2. Without provision for modification or abrogation of plan. V. Wage advance plans. VI. Declaration of intention to inaugurate a guarantee. ID EN TIFIC ATIO N Each clause, paragraph, or series of paragraphs from a separate contract or written description of plan is designated by a serial number. The industry, labor organization involved (if quoted from an agreement), and affiliation of the labor organization are indicated immediately following the serial number in order to give the reader an idea of the industry into which the plan has been introduced and the representaion of the workers. The labor organizations are indicated by initials only. The following is a list of the full names of the organizations and the initials used: 63 APPENDIX B.---- CLAUSES IN GUARANTEE PLANS AND CONTRACTS Initials TC (A F L )____________ Inti. Bro. of Teamsters, Chauf feurs, Warehousemen & Help ers of America. Initials Labor organization ACW (C IO )__________ Amalgamated Clothing Workers of America. AFM (A F L )__________ American Federation of Musi cians. BCJ (A F L )___________United Bro. of Carpenters & Joiners of America. BFC (C IO )___________Inti. Union of United Brewery, Flour, Cereal & Soft Drink Workers of America. BPM (A FL)__________ Inti. Bro. of Paper Makers. CTU (A F L)__________ Commercial Telegraphers Union of North America. CW (A F L)___________ Cereal Worker’s Union (Federal Labor Union). EA (Ind.) ___________ Employees’ Association. E R M W (C IO )________ United Electrical, Radio & Ma chine Workers of America. FSC (A F L )___________Federated Shop Crafts (Railway Employees’ Department). FSES (Ind.)__________ Friendly Society of Engravers & Sketchmakers, Inc. FTA (C IO )___________ Food, Tobacco, Agricultural & Allied Workers Union of America. FW (C IO )____________ Inti. Fur & Leather Workers’ Union. GP (A F L )____________ American Federation of Grain Processors Council. HLU (Ind.)__________ Harlem Labor Unions. H R (A F L )____________Hotel & Restaurant Employees’ Inti. Alliance & Bartenders’ Inti. League of America. ILA (A F L)___________ Inti. Longshoremen’s Assn. ILG (A F L)___________ International Ladies’ Garment Workers’ Union. M E (C IO )____________Natl. Marine Engineers’ Bene ficial Assn. M M P (A F L )_________ Masters, Mates, & Pilots of America. MP (In d.)____________ Machine Printers Beneficial Assn. NEUA (Ind.)_________ New England Utilities Alliance. OE (A F L )____________ Inti. Union of Operating En gineers. OPW (C IO )__________ United Office & Professional Workers of America. PDP (A F L)__________ Bro. of Painters, Decorators & Paperhangers of America. PPA (A F L )___________Inti. Printing Pressmen’s & Assistants’ Union of North America. RC (A F L )____________ Retail Clerks Inti. Protective Ass’n. R W D (C IO )__________Retail, Wholesale & Department Store Union. SW (C IO )____________ United Soap Workers (Local Industrial Union). Labor organization TW U (CIO)__________ Textile Workers’ Union of Amer ica. UAW (CIO)__________ United Automobile, Aircraft & Agricultural Implement Work ers of America. UIU (A F L )___________Upholsterers’ Inti. Union of North America. UM W (A FL)_________ United Mine Workers of America UPW (C IO )__________ United Packinghouse Workers of America. USW (C IO )__________ United Steelworkers of America. I. A Full Year’s Guarantee to all Employees A guarantee may consist of an assurance of either income or employment. A full year’s guarantee is generally expressed in terms of (1) a specified amount of wages per week (at stipulated hourly rates) for 52 weeks, (2) a total sum of wages for the year, (3) employment for 52 weeks per year (at a specified number of hours per week and rate per hour), or (4) employment or wages for 2,080 hours (regardless of weekly fluctuations). A guarantee to a ll employees generally applies to all nonexecutive em ployees and excludes all above the level of working foremen. “ All employees” may include only factory workers; the office force may be excluded. Casual, temporary, or extra shift workers may also be excluded from coverage, either by explicit statement or without formal provision. In some cases the guarantee appears as a prohibition against lay-offs for the duration of the agreement (usually 1 year), rather than as a positive guarantee. A. PLANS W ITH EM PLOYEE E L IG IB IL IT Y QU IREM EN T RE Coverage in some plans is restricted to employees who have been in the company’s employ for a specified period, ranging anywhere from a 1- or 2-weeks’ probationary period to a 5-years’ service record. Where eligibility applies to those who have qualified as “ permanent,” “ regular,” “ qualified,” or “ eligible” employees, these terms are generally defined in another section of the agreement or written description of the plan as requiring a probationary period of service. 1. P l a n s W it h E l ig ib il it y R e q u ir e m e n t P r o v is io n f o r M o d if ic a t io n or and W it h A b r o g a t io n of P lan Some guarantees include a provision placing certain limitations on the employer’s financial responsibility, either (1) specifying the amount to be expended for the purpose of the guarantee, (2) permitting the employer to modify the plan in the event of a serious decline in business, or (3) reserving to him the right to suspend or terminate the guarantee in case of strike, flood, fire, war, or other contingencies beyond his control. 1. F lou r m ill— G P (A FL) G u a r a n te e d W o r k w e e k : (A) During the term of this agreement the “ company” agrees to guarantee to all 64 GUARANTEED WAGE PLANS IN THE UNITED STATES regular employees (all em ployees are considered regular employees except those as defined in paragraph (c) of this section) at least forty (40) working hours each week; provided, however, due to variation in weekly operations the em ployee may not work his full forty (40) hours or he m ay work over the guaranteed forty (40) hours per week, therefore, the com pany at the end of each thirteen (13) week period from the effective date o f ------- will total the hours worked b y each em ployee for said period and pay him at his regular rate per hour any deficiency in hours worked for said thirteen (13) week period up to (520) hours. (B) If due to conditions beyond the com pany’s control or b y an act of God, which would cause the com pany to cease operations for more than one (1) week the above guaranteed workweek shall not apply during such period of emergencies. In case of such emergencies as described the com pany and the union shall meet to work out an equitable agreement during such period. (C) The above guarantee does not apply to third trick employees if business conditions necessitate adding third (3d) trick. Providing, however, (3d) trick does not con tinue more than ninety (90) days, in any quarterly 13week period, but if more than ninety (90) days, all third (3d) trick employees will be covered b y guaranteed work week, it being the practice to lay the youngest employees off first when reduction becom es necessary. 2. Flour m ill— G P (AFL) S e c t io n X V I. Eight hours shall constitute a day’s work. F orty hours shall constitute a week’s work. Tim e and one-half shall be paid for all work in excess of eight hours per day or forty hours per week. The com pany guarantees all regular em ployees forty hours work each week, except that millers, machine tenders, and one mill wright are guaranteed forty-eight hours’ work each week during the life of this agreement, unless a prolonged shut down is caused b y an act of God, lightning, fire, or ex plosion. 3. T e x tile d y ein g an d finishing— T W U (C IO ) Guarantee Wage Plan: (d) AH male employees, who have a service record o f 1 year or more shall as of the first o f J a n u a ry ------- and during thfeir continuance on the pay roll receive a minimum pay on a weekly basis of n ot less than $18.00 per week throughout the period of this agreement, and also all female employees, who have a service record of 1 year or more shall as o f the first of January ------- and during their continuance on the pay roll receive a minimum pay on a weekly basis o f not less than $15.00 per week throughout the period o f this agree m ent; provided however, that in the application of the annual minimum, the cost to the em ployer shall not exceed $8,000.00 per year. This $8,000.00 shall be applied dur ing the period when the workers ordinarily earn less than $18.00 and $15.00 per week, respectively. On such occa sions, the em ployer shall add to the worker’s actual weekly earnings, the difference between the amount earned and the weekly minimum as hereinabove set forth. The above m ethod shall be continued until the entire $8,000.00 has been exhausted. Be it further understood that any employees who fail to report for work when notified to do so, shall have deducted from their weekly minimum, an amount equivalent to the amount earned by the workers in their department. Such deductions shall be applied only during slack periods when application for the weekly minimum is made. 4. T ex tile d y ein g an d finishing— T W U (C IO ) S e c t io n IV . 3. Guarantee of Wages and Severance P a y: (a) All skilled employees covered b y this agreement who have passed their probationary period as hereinbefore set forth, shall be paid on the basis of fifty-tw o (52) weeks per year. This provision shall not apply, however, if the em ployee’s relations with the com pany are severed volun tarily or involuntarily. (b) Any new em ployee hired to replace an em ployee whose relations with the com pany are severed voluntarily or involuntarily shall be paid on the fifty-tw o (52) weeks per year basis. (c) In the event that an em ployee’s relations are severed because of the elimination of a jo b or department such employee shall receive as severance pay an amount equiva lent to two percent (2% ) of his total earnings during his period of service with the em ployer up to a maximum of 5 years’ earnings. (d) All assistant foremen and assistant colorists hereto fore paid on a fifty-tw o (52) weeks per year basis shall continue to be paid on that basis. (e) All assistant foremen and assistant colorists not heretofore paid on the fifty-tw o (52) weeks per year basis shall be subject to the follow ing provision: In the event any plant or department closes because o f lack of work for a period of longer than six (6) weeks, such em ployees shall receive one-half of their weekly rate of pay for each week during which the plant or departm ent remains closed up to and including fourteen (14) weeks. Wages shall con tinue to be paid on each regular pay day. (f) A ny discharged em ployee shall receive a severance paym ent of not less than tw o (2) weeks’ wages upon re ceiving notice o f his discharge. 5. S oa p m a n u factu rin g— N o u nion Guarantee of Regular Employment to Employees: 3. T o the employees located at such factories as above stated whose pay is com puted on an hourly rate, and who have had at least tw enty-four (24) consecutive months of em ploym ent im m ediately preceding the application of this plan to their em ploym ent, the undersigned com pany hereby guarantees regular em ploym ent for not less than forty-eight (48) weeks (or its time equivalent) in each calendar year less only tim e lost b y reason of holiday closings, vacation with pay, disability due to sickness or injury, voluntary absence, or due to fires, floods, strikes, or other emergency whether like the foregoing or not, and subject to the follow ing provisions: a. Regular em ploym ent shall be understood to mean em ploym ent for not less than the hour week established from time to time b y the com pany as the standard hour week at each of its factories. APPENDIX B.---- CLAUSES IN GUARANTEE PLANS AND CONTRACTS b. When an em ployee first comes under this guarantee after January 1 of any calendar year, the com pany guar antees to him under the terms and provisions outlined herein that he shall not be unem ployed in excess of four (4) weeks (or its time equivalent), plus time lost for rea sons herein stated, during the remainder of the calendar year. c. The com pany reserves the right under the guarantee to transfer any em ployee to work other than that at which he is regularly em ployed, and to compensate him for the same in accordance with the wage rate which prevails for the work to which he has been transferred. d. Upon authorization from the board of directors and without changing the established hour week, the hours of work for employees com ing within the terms of this guar antee may be limited to 75 percent of the established hour week less time lost for reasons stated above, whenever in the opinion of the board of directors such action seems justified. e. A ny individual hired to replace an em ployee leaving for military service or training, or for other services made necessary b y a national emergency, shall be considered a tem porary em ployee and he shall be so inform ed at the time of his em ploym ent. The com pany will not consider such an em ployee within this guarantee. If at a later date subsequent to his em ploym ent, conditions should warrant it, within the sole discretion of the com pany, he m ay be inform ed that he is then eligible for this guarantee in accordance with the terms of this plan. f. The right to discharge any em ployee at any time is reserved to the com pany em ploying such employee. 4. This gu arantee of em ploym ent has been established because the com pany believes it to be sound business practice and a desirable protection for its employees. It is the intent of the com pany to maintain it, but the com pany must and does reserve the unqualified right, to be exercised at its sole discretion, to withdraw this guarantee at any of its factories, or to terminate or to m odify this guarantee at any time. 6. T o o l an d castin g m anu factu ring— U S W (C IO ) a. The corporation guarantees to every em ployee who has com pleted five years continuous service in the em ploy of the corporation at ------- a minimum em ploym ent of 2.080 hours for each yearly period begin n in g-------and con tinuing each year thereafter during the life of this contract. All hours worked b y said employee, both straight time and overtime, shall be credited against the 2,080 hours. If the corporation does not provide work for any part of the 2.080 hours the em ployee shall be paid for the unworked hours at his straight time hourly rate. b. An em ployee failing to accept other work assigned by the corporation when his own job is not working, or dis continued because of production requirements, shall not be entitled to the guarantee herein provided. An em ployee who voluntarily leaves the em ploy of the corpora tion, or who is discharged for cause, shall not be entitled to the guarantee. In the event of an em ployee’s failure to take advantage of available work-hours such hours shall be deducted from the guarantee of 2,080 hours. In the 65 event of a strike the corporation shall be relieved of its guarantee for the current one year period as to the em ployees striking. 7. W a sh in g m a ch in e produ ction — U S W (C IO ) It is the intent and purpose of the parties hereto that this agreement will prom ote and im prove industrial and econom ic relationships between the em ployees and the com pany and to set forth herein the basic agreement governing rates of pay, hours of work, and conditions of em ploym ent to be observed between the parties hereto. The term em ployee as used in this agreement shall in clude only factory employees but shall not include foremen, assistant forem en, and supervisors in charge of any classes of labor. S e c t io n 2. Wages: I. Rates and conditions of pay under this contract shall be as follows: A. E ffective [date] exclusive of those 60 years of age and over, all employees with five (5) or m ore years of accumulated seniority as of [date] will receive a guaranteed annual wage of $1,260 for not more than 2,000 hours of any work which at prevailing rates of pay m ay be available provided that this guarantee will be autom atically can celed upon term ination of em ploym ent either b y quitting or b y lawful dismissal and also provided that all absent tim e for any cause when work is available shall be de ducted from the annual guarantee and credit given when allowed to be made up. B. Effective [date] those employees on the seniority list who are 60 to 64 years of age, inclusive, will receive a guaranteed annual wage o f $1,100 for n ot more than 2,000 hours of any work at the prevailing rates of pay, under the same circumstances as outlined in paragraph A of this section. E xcept as otherwise provided in paragraphs C and D , em ployees who becom e 65 years of age within six (6) months from the date of execution of this contract shall continue within the guarantee during the life of this contract. 8. W h olesa le h ardw a re— U S W (C IO ) S e c t io n 12. Guaranteed Weekly Wage: The com pany guarantees to each em ployee, whose em ploym ent has been continuous for six (6) months, and whose services are available to the com pany, a minimum weekly wage during the period of his em ploym ent within the life of this contract, this to be com puted by multiplying the em ployee’s hourly rate of pay by forty, providing nothing herein shall impair the right of the em ployer to terminate em ploym ent of any em ployee because of change of business conditions or for cause. 9. W h o le sa le fu rs— F W (C IO ) T w e l f t h . Tenure and Exchange: The tenure of em ploym ent of permanent employees shall be fifty-tw o (52) weeks in each year without any lay-offs whatsoever. The em ployer may desire to exchange the services of not more than three (3) of its permanent employees for another or other em ployees in the same number to be furnished b y the union. In such case, should the union not consent 66 GUARANTEED WAGE PLANS IN THE UNITED STATES thereto, the question as to whether such em ployee or employees shall be exchanged, shall be submitted to the im partial arbitrator hereinafter named. If replaced, such em ployee or employees shall receive a minimum of tw o (2) weeks’ severance pay, plus any additional award that the arbitrator may make. Such request for exchange shall not be made before the expiration of nine (9) months from the com m encem ent date of this agreement and shall not be used to penalize the em ployee’s union activities. In the event of such substitution, the new em ployee or employees shall receive the same wages as the former em ployee or employees. 10. R etail c o n fe ctio n e ry — H L U (In d.) 4. New employees shall be considered em ployed on trial for a period of two weeks. Thereafter the new employee autom atically shall becom e and remain a permanent and regular em ployee of the employer, in which event such em ployee may not be discharged excepting pursuant to the terms of this agreement. The em ployer shall only be required to pay the em ployee during such trial period for such tim e ’as said em ployee has been actually em ployed and such em ployee m ay be discharged at any time during the said trial period. T he em ployer during such trial period, shall have the right to determine the qualifications o f the employee. 7. Subject to the provisions herein, all present em ployees of the em ployer who are or who shall becom e members of the union as herein provided, shall be continued in their em ploym ent during the life o f this agreement. 9. The employer may not discharge any em ployee except for cause upon one week’s prior notice given to the union in writing of his intention to discharge. The union during said period o f one week m ay dispute the cause o f discharge or the validity of the intention to discharge, and in the event the parties affected are unable to agree with respect to the same, then, and in that event, the justification for the discharge shall be subm itted to arbitration as here inafter provided. 10. The em ployer shall give to each permanent em ployee fifty-tw o (52) consecutive weeks o f em ploym ent during each year of this agreement. 11. The union shall be the sole judge o f the good stand ing o f its members and upon notice b y the union to the em ployer in writing that any em ployee is not a member in good standing in the union, such em ployee shall forthwith be discharged. 11. D ep a rtm en t store— N o u n ion Annual Employment Guarantee: This guarantee is given to all members, except those covered b y other contracts, according to length of service on an annual basis, dating from February 1st of each year to February 1st of the fol lowing year. It is subject to renewal each year, and an announcement regarding same is made during the latter part of the year preceding the period covered. It is based on the follow ing service record: M em bers with over 6 years o f continuous service are guaranteed 52 weeks. M embers with 3 to 5 years of continuous service are guaranteed 48 weeks. M embers with 1% to 3 years of continuous service are guaranteed 44 weeks. M embers with 1 to 1)4 years of continuous service are guaranteed 40 weeks. This guarantee applies only to members on our regular pay roll on a full-time or daily part-tim e basis and not to contingents or per diem members. Under this guarantee, the right is reserved to transfer from full time to part time where necessary in order to maintain proper relations between business and expenses. This would be done on a fair seniority basis with proper notice. 12. M a il o rd er h ou se— N o u n ion How the Annual Wage Plan W orks: W e know that if we could guarantee a full week’ s pay every week in the year, it would mean not only greater security for our employees but a sounder foundation for the future growth o f our business. All male em ployees are guaranteed 40 hours’ pay per week. All female em ployees are guaranteed 36 hours’ pay per week. This differential was based on the fact that wom en, under the Illinois laws, are n ot perm itted to w ork as long hours as men. The same principle was follow ed in establishing guaranteed hours. When the com pany is not successful in providing a whole week’s work for any em ployee, the com pany gives that em ployee a cash advance, making up the difference be tween what he actually worked and his guaranteed pay. This advance bears no interest and is canceled in the event o f an em ployee’ s death or in the event that the em ployee leaves the com pany’s service. The advance can only be repaid in work. A t the end o f any year, all outstanding advances are canceled. No P ay is Held Back: N o pay is held back against possible future advances. The em ployee is always paid the guar anteed wage in full after past advances have been canceled. Who is Eligible: A fter an em ployee has held a job [with com pany] for a year and a half, and worked 3,000 hours during that period, the em ployee is classified as a “ perm anent” em ployee. All permanent employees are eligible for the annual wage plan. The Plan in Operation: As an example o f how the plan works, suppose a man works 37 hours during the week. H e receives a check for 40 hours’ pay with a notice that he has been given a cash advance o f 3 hours. The next week he works 43 hours and receives a check for 41)4 hours’ pay, the 3 hours over 40 being paid for at the rate o f time and one-half for overtim e or the equivalent of 4)4 hours’ pay which cancels the previous 3 hours’ advance. O ver time after 40 hours a week is paid for and is used to cancel cash advances at the rate of time and one-half. In the event o f fires, floods, wars, riots, revolutions, general strikes, and other situations beyond the control of [company], the management reserves the right to rescind the annual wage plan. APPENDIX B.---- CLAUSES IN GUARANTEE PLANS AND CONTRACTS 67 The management reserves the right to discharge per manent employees, regardless of their permanent rating, for causes of inefficiency, insubordination, thievery, mis demeanor, or incapacity because of health. the exact amount of the time of the absence, unless it is less than one-half day in any one day or an aggregate of two days in any one year. 13. P u b lic utility— E A (In d .) 2. P l a n s W it h E l ig i b i l i t y R e q u ir e m e n t b u t W it h o u t P r o v is io n f o r M o d if ic a t io n o r A b r o g a t io n of P lan A r t ic l e X I I : Section 1. It is agreed that the present establishment of forty (40) hours per week of the com pany will remain in effect, except in those divisions where longer or shorter hours are now being worked, and the company guarantees em ploym ent o f not less than forty (40) hours per week for 52 weeks o f each year to all employees repre sented by the union as bargaining agent, who are available and ready and able to work, and who are regular full-time employees of the com pany, except those on a less than forty (40) hour basis now. N o such employees shall be required to work more than forty (40) hours in any one week, consisting of seven (7) days, nor more than eight (8) hours in any one day except as hereinafter provided. The union and the com pany agree to abide by any changes made in the Wagner Labor A ct and Wage aad Hour Law. Nothing in this section will affect in any manner the right o f the com pany to make tem porary or permanent reduction in forces when considered necessary by the company. 14. S o cia l se rv ice a g en cy — O P W (C IO ) N . Guarantee: The ------- guarantees an annual wage to certain classifications of housekeepers for the year from ------- to ------- , inclusive, according to the following schedule: (1) Housekeepers who have com pleted one and a half years o f service -------, and who are available for full-tim e em ploym ent as of that date, shall be guaranteed for the period from ------- through ------- , an am ount equal to the wages o f the housekeepers regular rate for 52 weeks. (2) Housekeepers with less than one and one-half years o f service as of -------, and those who re mained on a part-tim e basis, have no annual guar antee but are given work as available. (3) N o additions to the guarantee list shall be made during the period from -------, through ------- . All monies paid by the association, including wages paid during vacation and sick leave, part time, full time, 24-hour service, overtim e, or any com bination of these shall be credited tow ard fulfillment of the guarantee. Each job shall be paid for at the time it is perform ed and in accord ance with the rates listed in clause I. A ny balance due on the annual guarantee shall be paid in a lump sum on or b e fo r e ------- . In the event of dismissal or resignation, the housekeeper forfeits all claims for paym ent of a guaranteed wage, except that in the event of dismissal for retrenchment or reorganization, the housekeeper shall be entitled to the paym ent of the proportionate part of the guaranteed wage fr o m -------to date of dismissal, in addition to her separation allowance. In the event of absences other than for sick leave allowed with pay, the guarantee shall be reduced b y 15. D istillery— B C J (AFL) It is agreed, and it shall be understood that for regular employees an average of 40 hours shall constitute a week's work. F ifty-tw o weeks of an average of 40 hours per week shall constitute a year’s work, for which work the em ployee will receive 40 times the hourly rate per week for 52 weeks. If at the end of a year, or any period after which the em ployee leaves the com pany or is discharged or fur loughed, the total number of hours of work exceeds the number of weeks em ployed times 40, such excess hours shall be paid for at the rate of one and one-half times the scale. 16. P ap er m a nu factu ring— EA (In d.) This agreement between the employees o f the ------com pany and the management is effective during the period o f ------- a n d -------- , inclusive, and covers conditions and terms to obtain during said period. These terms as agreed upon resulted from meetings of the em ployees beg in n in g ------- . 1. For all Class “ A ” employees we will arrange 1,820 hours of em ploym ent for ensuing period which is equiva lent to 35 hours of work per week for 52 weeks on the average. A. Class “ A ” em ployee working less than 35 hours in any one week when work is not available, will be paid for a full 35 hours of work that week, but the difference between the actual number of hours worked and the number of hours paid for will be charged against that employee. Then that number of hours will be credited or “ worked off” the first time that em ployee works more than 35 hours in one week and will continue until the number of hours due the com pany has been balanced after which the em ployee will then receive pay for the regular number of hours worked. B. Class “ B ” employees do not en joy this benefit. Classification of Employees: 1. A Class “ A ” em ployee is one that has been in the continuous em ploy of the com pany for a period of five years; said em ployee to be notified upon attaining this seniority b y the management. 2. A Class “ B ” em ployee is one that has been in the continuous em ploy of the com pany for a period of more than one year and less than five years, said em ployee upon attaining Class “ B ” seniority to be notified by the management. 17. P aint an d varnish m anu factu ring— EA (In d .) The com pany guarantees all regularly em ployed workers, who have been em ployed a full period of twelve consecu 68 GUARANTEED WAGE PLANS IN THE UNITED STATES tive months, 52 weeks’ pay a year at rates which will be determined b y mutual agreement, such weekly pay checks being estimated at %2 of the annual pay. Actual work ing time will be lim ited to a total of 2,080 hours in any one year, in accordance with the provisions of the Fair Labor Standards A ct o f 1938. It is our intention to em ploy in t h e ------- factory reg ularly only the num ber of workers required to operate on the basis of a 40-hour week during the period of normal business volume, i. e., April, M ay, October, and N o vember. During the four months (17 weeks) of peak pro duction, i. e., June, July, August, and September, and at such other times as m ay be deemed necessary, the regular workweek m ay be increased to 56 hours. During this period, however, each worker would receive his regular rate of pay for 40 hours, the pay for the extra hours being placed to his individual credit in the Employees Pay Reserve Fund. 18. S te e l m ill— U S W (C I O ) A r t ic l e X IV . Annual W age: Section 1. Each regular em ployee shall be guaranteed no less than forty (40) hours’ pay each week at his or her regular rate for each week during the life of this agreement. 19. R eta il an d w h o le sa le fo o d — R W D (C IO ) F o u r t h . All members 6f the union now or hereafter em ployed b y the em ployer are to be continued in such em ploy during the life of this agreement and subject to its conditions, and no mem ber of the union em ployed b y the em ployer continuously for a period of one week or longer shall be discharged except with the written consent of the executive board o f the union. Unless, in a par ticular case, the union shall agree in writing to the con trary, upon the term ination of em ploym ent, for any rea son whatever, of any em ployee who is a member of the union, the em ployer shall replace such em ployee forthwith with a new em ployee supplied b y the Union, in accordance with this agreement, at no less a wage than that received b y the em ployee he replaces. 20. R eta il dry g o o d s — R W D (C IO ) 2. The em ployer does hereby agree to em ploy all per manent em ployees who shall be declared b y the union to be its members in good standing, and who are now in their em ploy, as permanent em ployees for the duration, and subject to the terms o f this agreement. 21. R e ta il m e n ’ s cloth in g— A C W (C IO ) F o u r t h : (a) All steady em ployees who com e under the scope of this agreement shall be guaranteed steady em ploym ent throughout the life o f this contract. 2 2 . R e ta il s h o e s— R W D (C IO ) A r t ic l e V I. Classification and Tenure of Employment: (a) Regular “ certified” full-tim e workers shall be guaran teed a regular w eek’s work for fifty-tw o consecutive weeks per year. This provision shall not be subject to arbitration. (b) Regular “ certified” part-tim e workers shall be guaranteed em ploym ent for at least three full days weekly or for at least three nights and a Saturday weekly for fifty-tw o consecutive weeks per year. This provision shall not be subject to arbitration. (c) The em ployer m ay em ploy extra workers for Satur days only or for a period in advance of holidays only or for an emergency only. Such workers shall not be deemed to be permanent or regular workers but merely extras, and, at the term ination of the particular period for which they m ay be em ployed, they need n ot be reemployed. 23. C em etery — F T A (C IO ) 7. Hours and Working Conditions: (c) N o regular [5(a) Regular em ployees are those workers em ployed all year round irrespective of weather or other conditions.] em ployee shall be laid off during the continuance of this agreement. It is understood, of course, that the em ployer shall not be obligated to compensate the em ployees during their absence from the cem etery, excepting on the desig nated holidays and during the vacation period o f such em ployees as hereinafter provided. 24. P u b lic u tility— N E U A (In d .) III. Hours o f Labor: It is hereby agreed that 40 hours shall constitute one normal workweek of 8 hours per w ork day for 5 days per week for the period of 50 weeks during each calendar year, and no perm anent em ployees shall be em ployed more than 2,000 hours during said calendar year. The com pany will make 2,000 hours’ work during said calendar year available to each com petent, permanent em ployee. In the event that overtim e work is necessary as a result o f an emergency or other cause, the com pany m ay work em ployees overtim e; provided that such em ployees receive compensation for em ploym ent in excess of 12 hours in any w orkday or for em ploym ent in excess of 56 hours in any workweek, as the case m ay be, at the rate of 1)4 times the regular rate at which they are em ployed; and provided that such em ployees shall not be compensated for overtim e work not specified above, namely, em ploy m ent in excess of 12 hours in any workday, or em ploym ent in excess of j56 hours in any workweek, bu t that such em ployees shall be given time off, with compensation at regular rates, equal to the num ber o f hours such em ployees engage in overtim e work for which they receive no com pensation. Such time off shall be granted to such em ployees, so far as practicable, and at the request of such employees, at a tim e or times m ost convenient to such employees. It is further agreed that any em ployee w ho is called upon for overtim e work between his regular hours and after he has left the com pany’s premises, shall receive a minimum tim e credit of four hours for such overtim e work, even though such em ployee m ay not have w orked four hours. It is further agreed that, in the event any permanent em ployee shall be absent from work through bona fide sickness or injury for which no compensation is received under sections (a), (b), and (c) below, or through emer gency causes, or with the com pany’s permission, such em ployee shall be entitled to have any overtim e credits APPENDIX B.— CLAUSES IN GUARANTEE PLANS AND CONTRACTS earned b y him as aforesaid credited to such time as he m ay have been absent; and that such em ployee may, in the absence of earned overtime credits, at the discretion of the com pany, make up such absent time b y overtime work. It is further agreed that such permanent em ployee who has been in the em ploy of the com pany for one year or more shall receive tw o weeks’ vacation each year with full pay at regular rates, the vacation period to be set b y the com pany. B. P LA N S W IT H O U T E M P L O Y E E R E Q U IR E M E N T E L IG IB IL IT Y Some plans covering all of the working force have no service or other requirement for eligibility. 1. P l a n s W it h o u t E l ig ib il it y R e q u ir e m e n t b u t W it h P r o v is io n f o r M o d if ic a t io n o r A b r o g a t io n of P lan 25. F lou r m ill— T C (AFL) A r t ic l e V I. D uring the term of this agreement, all employees shall receive a minimum of seventy cents (700) per hour and any em ployee receiving more than sixty-tw o and one-half cents (62^0) per hour at the time of the sign ing of this agreement shall receive seven and one-half cents (7^0) per hour increase. All employees shall be paid at the rate of time and one-half of the regular rate of pay for all time worked in excess of forty (40) hours per week. The em ployer agrees to guarantee all employees now in its em ploy and covered b y this agreement a minimum weekly wage of tw enty-eight dollars ($28.00) per week, and to all em ployees now in its em ploy and receiving pay at a rate of more than seventy cents (700) per hour under the terms of the agreement a minimum weekly wage equivalent to forty (40) times the hourly rate of pay received b y such em ployee under the terms of this agreement. Such guarantee of weekly wages shall be effective for 52 con secutive weeks beginning -------. The above mentioned guarantee shall be null and void if and when the ------com pany is sold out to another and entirely different com pany or is liquidated b y the stock holders. Should it becom e necessary to lay off more than the youngest tw o employees on the seniority list in order to maintain the 52-week guarantee to the senior employees, the matter shall be discussed between the em ployer and the union shop com m ittee; failure of these tw o parties to agree, the dispute shall then be discussed b y the em ployer and the union executive board; failure of these tw o parties to agree, the dispute shall then be submitted to arbitration as provided for in article 10 of this agreement. All employees who have been in the em ploy of the em ployer for one year or more shall receive one week’s vacation with full pay. 69 ployee is found b y the arbitrator t o have been unjustly discharged, he shall im mediately be reinstated to his former em ploym ent and shall receive back pay from the date of discharge, or otherwise at the discretion of the arbitrator. 27. W h olesa le g ro ce rie s— T C (AFL) A r t ic l e i v . Seniority; Security: Section 7. The em ployer shall not discharge any em ployee without just cause and shall give at least one written warning notice of the com plaint against such em ployee, a cop y of which shall be sent to the union; except that no warning notice need be given to any em ployee before he is discharged if the cause o f such discharge is dishonesty, drunkenness on the job, recklessness, or gross negligence. Appeal from discharge must be taken within five (5) days by written notice to the em ployer and a decision reached within ten days from the date of discharge. 28. W h o le sa le fu rs— F W (C IO ) F ir s t . A ny em ployee or employees presently em ployed shall be retained by the employer. T e n t h . Discharge. There shall be no discharge of employees belonging to the union, except for the follow ing reasons: (1) Dishonesty, (2) Repeated negligence, (3) W illful insubordination, (4) Leaving jo b w ithout permis sion during working hours, and (5) Intoxication during business hours. In the event the em ployer wishes to discharge any em ployee for any other reason than heretofore set forth, the em ployer shall n otify the union through the council b y registered mail of the name of the em ployee whom he wishes to discharge, and the reason for such discharge. 29. R etail m e n ’ s cloth in g— R W D (C IO ) T h ir d . Notice. T he employer agrees that each em ployee in his or its em ploy shall have fifty-tw o consecutive weeks of em ploym ent during each year. (a) An em ployee m ay be discharged upon tw o weeks’ written notice b y the em ployer to the union, sent b y regis tered mail, and with the written consent of the union. Such notice b y the em ployer to the union, requesting such discharge, shall set forth the details impelling the request for the discharge. (Slack season, however, shall not be deemed a cause or a reason for the discharge o f a regular em ployee). Upon the consent, in writing, b y registered mail, given b y the union, such em ployee affected b y the notice shall be discharged at the end of such tw o weeks’ period of notice. Upon the refusal, failure or neglect of the union to consent to such discharge, such employee, nevertheless, shall be continued in the em ploy of the em ployer until the matter shall have been determined by arbitration as hereinafter provided. 26. Jew elry m anu factu ring— R W D (C IO ) 30. R etail cloth in g, d ru gs, ra d io, an d lu m b er (fo rm a g ree m en t)— R W D (C IO ) W i t n e s s e t h : 4. The em ployer shall not discharge any em ployee except for just cause. A ny dispute relating to any discharge shall be handled as provided in article X I I , subdivision B, of this agreement. In the event the em Discharge and Lay-Offs: Fourth. N o employee shall be discharged, laid off, or suffer a reduction in working hours except for good and just cause. N o proposed dis charge, lay-off or reduction in working hours shall b e 70 GUARANTEED WAGE PLANS IN THE UNITED STATES com e effective until the union has been notified thereof in writing, with the reasons therefore, and the union, after an investigation, shall have given its consent thereto in writing. Should the union deny the firm’s request, the firm may either accept the union’s decision or in the alternative proceed to arbitration. N o employee shall be discharged, suspended, suffer reduction in working hours, or be laid off until after a decision in the firm’s favor, except that an em ployee charged with criminal negligence or dishonesty may be summarily discharged. Should the union deem itself aggrieved in the case of a summary dis charge as aforem entioned, the union shall, without delay,, submit the matter to arbitration. Should the arbitrator decide in favor of the employee, he shall be reinstated to his former position and be compensated for loss of time. N o lay-off shall be granted b y the arbitrator except in the case of a substantial, permanent decline in the business which shall necessitate the relief requested. Seasonal declines shall not be deemed cause for lay-off. 31. C lean ing an d dy ein g — A C W (C IO ) 28. N o employee shall be discharged without just cause. A ny and all complaints, grievances or disputes that may arise between the parties hereto shall be taken up for adjustm ent between the representatives of the parties in the first instance. In the event they are unable to adjust the same prom ptly it shall be referred for arbitration and final determination to an impartial chairman and arbi trator to be mutually agreed upon by both parties. Any and all decisions, directions or orders of the impartial chairman shall be final and binding upon all parties and shall be fully enforceable in an appropriate court of law or equity. The impartial chairman, however, shall have no authority to enlarge, alter, or m odify this agreement. The fees o f the impartial chairman and the expense of arbitration shall be shared equally between the parties to this agreement. 2. P l a n s W it h o u t E l ig ib il it y R e q u ir e m e n t a n d W it h o u t P r o v is io n f o r M o d if ic a t io n o r A b r o g a t io n of P l a n 32. D airy farm — F T A (C IO ) A r t ic l e III. The com pany further agrees to maintain such weekly hours as will best serve its regular personnel maximum and continuous em ploym ent; such hours to average fifty (50) per week over a one-year period begin ning with------- . The com pany agrees to pay time and one-half for all hours over forty (40) hours worked in any one week. 33. P aintin g and d e cora tin g — P D P (AFL) 1. The em ployer during the existence o f this contract, agrees to hire and maintain for its painting, decorating, and paperhanging, plaster patching, cleaning, washing, any and all work preparatory to painting in its buildings, qualified and com petent men, who are members of the union in good standing. 2. The em ployer agrees to provide for its maintenance men, within the description thereof herein contained, not less than 42 weeks’ work each working year; a working week to consist o f a maximum o f -------in every week. 2a. An annual wage o f ------- shall be paid for a maximum o f 52 weeks. All overtim e work shall be paid for as pro vided in paragraph 5. ------- days’ annual sick leave and ------- days’ vacation with full pay for all employees. 34. M e a t packin g— U P W (C IO ) Straight-Time Arrangement: Each em ployee regularly assigned to a straight-time department will receive the weekly rate o f pay provided for him in the latest approval of the straight-time plan for his department. This rate of pay will be subject to any increases or decreases affect ing the plant as a whole. Each em ployee will receive his regular pay check every week except when absent beyond regularly provided sick leave or vacation. * * * The straight-time arrangement with respect to any de partment m ay be canceled at any time that department fails to abide by all working agreements, or at any time the discontinuance of the straight-time arrangement in some other department directly affecting it requires the cancel lation. If other hour limitations becom e established by law, this plan will be changed to conform to such law, or if the com pany considers the straight-tim e plan unworkable because of the passage o f any such law, the whole straighttime arrangement, or any part of it, may be canceled as of the effective date of any such law. Any tim e any departm ent becom es dissatisfied with the straight-time arrangement and wishes to cancel it, such cancellation m ay be effected in the usual manner o f handling grievances. Otherwise straight-time arrangement m ay be discon tinued only b y thirty days’ advance notice o f desire to make such discontinuance at the end of the com pany’s fiscal year. * * * I f there is any increase or decrease in the amount of work required to produce the budgeted volume, a corresponding adjustm ent will be made in the department volume budget or in the number of people in the department. The choice as to which adjustm ent shall be made will be left to a decision b y a m ajority in the departm ent in case the change is an increase. In case the required am ount of work is reduced suffi ciently to perm it the rem oval of one or more employees, such employees will be transferred from the departm ent on a seniority basis. When the manufacture of some item is discontinued, or when, because of a change in m ethod of operation, certain jo b or jobs are discontinued, it is under stood that it will be necessary to reduce the straight-tim e gang correspondingly. Such reductions will be made on the basis of seniority. E xcept as provided in the 2 preceding paragraphs * * * there will be no reduction in the num ber of em ployees in any straight-time departm ent within a period of one year from the latest approval of the straight-time arrangement for that department. Any em ployee who is laid off from a straight-tim e departm ent m ay find em ploym ent else APPENDIX B.---- CLAUSES IN GUARANTEE PLANS AND CONTRACTS where on the basis o f his regular seniority rights, or, on application, m ay be transferred, at his regular rate of pay, to the “ extra gang” which will be maintained to handle extra work, tem porary replacements, and other business requirements which cannot be handled b y the regular straight-time departments. During the period of any one fiscal year, this extra gang will not be reduced below the number who have been transferred to it from regular straight-time em ploym ent, thus maintaining em ploy ment with full pay for at least one year for the number o f individuals originally assigned to the straight-time schedule for any year. Any em ployee laid off from the extra gang may find other em ploym ent on the basis of his seniority rights. For each department for which it is possible to estab lish some measure of the work to be done, the budgeted annual volum e will be stated. (See Schedule B attached.) In any year in which the department produces less than the budgeted annual volume, the members of the depart ment, individually and collectively, becom e indebted to the com pany for producing that much work at the first opportunity. A t the end of any year in which the cumulated produc tion of the department is in excess of the cumulated budg eted annual volum e, bonuses will be paid the members of the department. These bonuses will be calculated on the basis o f what the cost of the extra production would be b y adding m ore employees to the department, and the specific m ethod o f calculating it with respect to the de partm ent will be found in Schedule B attached. A t the end of any year in which the cumulated produc tion of the departm ent is in excess of the cumulated budgeted annual volum e, and during which regular mem bers o f the departm ent have been absent without pay and without being replaced, the cost of such replacements will be put in a “ k itty ” to be distributed among the mem bers of the departm ent in whatever manner the m ajority o f the departm ent m ay agree. For each department there will be maintained what will be known as a “ kitty.” Schedule B attached will show the departm ent work budget, if any. Unless otherwise provided in schedule B for those departments having work budgets, em ployees docked for absence, and employees absent on vacations granted on the basis of 5, 15, or 20 years’ service, will be replaced. Replacements will be made in either men or money. That is to say, if the department does not require a re placem ent man, the m oney for the replacement will go to the department kitty. The management will have the right to insist on replace ments if the tonnage produced falls below the daily or weekly volum e which the com pany’s business requires, or if the average actual hours worked is or threatens to be in excess of 40 hours per week. The department com m ittee will direct whether replace ment m oney will be paid to individuals in the gang or whether it will remain in the department “ k itty .” The m oney in the department “ k itty” will be distributed among the members of the department at the end of each fiscal year, and in whatever manner the m ajority of the department may agree. 71 35. M e a t packing— U P W (C IO ) S e c tio n 4. Hours o f 1fo r k and Overtime: Each * * * employee of the com pany, unless specifically excepted b y notice in writing by the com pany to the union, will be employed on an annual basis and shall receive the regular weekly rate of pay provided for him in a work schedule established for his department as it m ay be amended from time to time in pursuance to the procedures estab lished in this agreement. In no case shall any such em ployee be em ployed more than two thousand eighty (2,080) hours within the applicable fifty-tw o (52) week period, and each regular employee shall receive compensa tion for em ploym ent in excess of ten (10) hours in any workday, or fifty-three (53) hours in any work week, as the case may be at the rate of one and one-half (1 ^ ) times the regular hourly scale rate of the job at which he is employed. 36. T ex tile d y ein g an d finishing— M P (In d .) S e c t io n 1. Salary and Hours: The com pany agrees to continue to em ploy the members of the association now presently in the em ploy of the com pany during the period covered b y this agreement, and guarantees to pay for said period to each journeyman printer an annual wage of not less than thirty-nine hundred dollars ($3,900.00), payable weekly at the rate of seventy-five dollars ($75.00) per week. * * * The com pany agrees that each o f the said members of the said association in the em ploy of the com pany through out the period covered b y this contract shall, subject to and in accordance with the provisions of this contract, work not more than tw o thousand (2,000) hours during fifty (50) calendar weeks o f the period covered b y this contract. It is the intent of the parties hereto that the members o f the association shall have tw o (2) weeks’ vacation with full pay. 37. W h o le sa le hardw a re— U S W (C IO ) S e c t io n II. Weekly Guaranteed Rate: Each em ployee of the com pany is guaranteed a minimum weekly wage for each week during the life of this contract. The guaranteed minimum weekly wage shall be com puted in the following manner: The individual em ployee’s straight-time average hourly rate of earnings for the year preceding the effective date of this contract, or such portion there of during which the employees may have been em ployed b y the company, plus the general wage adjustm ents included in this agreement, shall be multiplied b y 40 hours. The guaranteed minimum weekly wage for any em ployee who may be em ployed after the effective date of this agreement will be determined b y multiplying his straight-time average hourly rate of earnings for the first three months of em ploym ent b y 40 hours. For each week during the life of this agreement that the em ployee who is continuously em ployed and whose serv ices are available to the company does not receive a sum 72 GUARANTEED WAGE PLANS IN THE UNITED STATES equal to the minimum as outlined above, the com pany shall make up the difference. 38. R etail co n fe ctio n e ry — R W D (C IO ) F ir s t . Employment of Union Workers: (f) Employees who are members of the union now in the em ploy of the em ployer shall be continued in their em ploym ent during the life of this agreement, subject to all terms and pro visions thereof. 39. R etail dry g o o d s — R W D (C IO ) T h ir d . All em ployees shall receive twelve (12) months of uninterrupted em ploym ent. 40. R etail m e n ’ s cloth in g— A C W (C IO ) It is further agreed that regular employees [all workers other than “ extras” ], be em ployed fifty-tw o (52) weeks per year. 41. R etail fu rs— F W (C IO ) W e further agree that these wages shall becom e effective as of March 15th, and shall remain in effect for a period of one year, and that during this time the workers shall be fully em ployed with the exception of one week to be taken as vacation with pay. 42. C em etery— U M W (A F L ) A r t ic l e V. All men in our em ploy February 1st shall be guaranteed work in accordance with Article II, Section A, during the year in which this agreement is in force. II. Less Than a Year’s Guarantee to all Em ployees Guarantees of wages or em ploym ent to all nonexecutive employees for less than a year apply to periods ranging from 3 months to 50 weeks. Such plans generally specify either (1) total am ount of earnings per year at established rates of pay or (2) em ploym ent for designated number of hours per week and weeks per year, or hours per year (regardless of fluctuation of hours). A. P LA N S W IT H EM PLOYEE E L IG IB IL IT Y R E Q U IR E M E N T 1 1. P l a n s w it h P r o v is io n P lan E l ig ib il it y R e q u ir e m e n t a n d W ith M o d if ic a t io n o r A b r o g a t io n of for 43. S a u sage ca sin g m a n u factu rin g— N o u nion Covenant: The com pany hereby agrees (subject to the limitations and conditions herein contained) that each eligible em ployee shall in case of a complete lack-of-w ork lay-off be indemnified for the difference between his weekly wages or salary (if any) earned elsewhere and his straight-time weekly wages or salary from this com pany for a period of not less than tw o months, or an aggregate of not less than 346% hours of make-up straight-time pay in the case of partial lack-of-w ork lay-off, or such com bina tions of the tw o as conditions m ay create. For each full year of service after the first year, tw o months of indemnity in case of complete lack-of-w ork lay-off, or 346% hours of straight-time pay in case of partial lack-of-w ork lay-off, will be added to the indem nity or guarantee until, after six full years of service, a maximum of one year or 2,080 hours’ indemnity or guarantee is provided. All subject to the following: 1. Definitions: All present full-tim e em ployees of the com pany are regarded as permanent employees hereunder. All form er employees now in the armed forces who return to this com pany within the period prescribed b y law or within the period prescribed b y our regulations (whichever is longer) shall thereafter im mediately be regarded as permanent employees. For persons engaged hereafter, a permanent em ployee shall be one who was notified in writing at the time of his em ploym ent that he was engaged as a permanent employee. All others hereafter engaged, except as hereinafter pro vided, will be tem porary employees. A full-time tem porary em ployee becomes a permanent em ployee after one or more years of service unless, prior to each anniversary date of his employm ent, he has been notified in writing that his status will continue to be that of a tem porary employee. A voluntary part-time em ployee remains a tem porary em ployee as long as he is on part time and thereafter until he has had one or more years of full-time employm ent. One year of service is one* year of continuous service in accordance with the com pany’ s service regulations. 2. Eligibility: Only permanent em ployees i n ------- area (which for the purpose of this plan includes all places within 50 miles of t h e ------- C ity Hall) with one or m ore years of service, who are wholly or partially laid off when there is a lack of work are eligible to receive the guaran teed pay. The com pany will require a receipt signed in person b y the wholly or partially laid off em ployee for each paym ent made and until such receipt, properly filled out, has been received, interim payments will be forfeited. Each receipt so signed b y the em ployee must state, am ong other things (a) whether or not be has worked for pay for any other employer, (b) whether or not he has been in business for himself, (c) whether or not he has applied for or received unem ploym ent compensation in any form from any source whatever, (d) whether or not he is in a posi tion to report for and resume work upon reasonable notice, and (e) his present address, all since signing the last previous receipt. In case (a) he has worked for any other em ployer for pay, he shall state the am ount of his then salary, or pay, on the receipt, which amount will be deducted from each subsequent paym ent as long as the laid off em ployee is receiving such salary, or pay from other sources. In case (b) he goes into business for himself, his benefits under this plan will cease. Should he discontinue his business, guaranteed payments will be resumed for the remaining portion of the time during which he was originally eligible. In case (c) he applies for or receives unem ploym ent com pensation from any source during his eligibility period hereunder, his benefits hereunder shall cease, future pay ments shall be forfeited, and he shall thereafter be classi- 73 APPENDIX B.---- CLAUSES IN GUARANTEE PLANS AND CONTRACTS fied as an employee who has quit. In case (d) he is not in a position to report for and resume work upon reason able notice, his benefits under this plan shall cease. Should he later notify the com pany that he is then in a position to report for and resume work upon reasonable notice, guaranteed payments will be resumed for the remaining portion of the time during which he was originally eligible. The com pany shall have the right, under this plan, to refer each wholly laid off em ployee to other suitable, avail able em ploym ent elsewhere within 15 miles of his home, and should the em ployee refuse such employm ent, he shall no longer be eligible under this plan. A wholly laid off em ployee notified by the com pany to return to work, which he is capable of doing, at any of the com pany’s plants or offices within 50 miles of his last em ploym ent with the com pany, shall do so within three days of the date specified in the notice, whereupon payments under this plan shall be discontinued. An em ployee who fails without good cause, to report within the three days re ferred to will forfeit all rights under this plan. In the case o f any fraudulent statement made on any receipt, all subsequent payments will cease and the com pany reserves the right to sue for the recovery of amounts paid since the fraud began. The following persons are among those who are not eligible, nor shall they have any claim hereunder: (a) Em ployees who quit. (b) Tem porary employees. (c) Em ployees discharged for gross incompetence or other cause. (d) Em ployees who are unable to continue or to resume work. An em ployee discharged for gross incompetence or for cause who does not adm it the incom petence or cause, shall have his present right unabridged to present his case in person to the executives of the com pany, and he may, if he desires, enlist the aid of the head of the personnel department in so presenting his case. 44. C ereal preparation s— B F C (C IO ) 1. Qualified Employees: (A) All present employees, men and wom en, working on an hourly or piecework basis who have service credit of not ]ess than six months accu mulated within a continuous twelve m onths’ period shall be entitled to the benefits of the plan. (B) New employees shall becom e entitled to the benefits of the plan after com pletion of six m onths’ service in a continuous twelve m onths’ period upon approval o f the plant management. N o t e : Em ployees having less than six months o f service who are laid off, absent account of sickness or by permis sion will receive credit for only the time actually worked, this to be cumulative and 70 hours of work done in a calendar month for which wages are paid shall be con sidered as one m onth of service credit. 2. Hours Guaranteed While on Pay Roll: The com pany guarantees qualified em ployees while they are on the pay roll 140 hours of work in each month, for which they will be paid their full hourly or base rate. 3. Hours Guaranteed While on Lay-Off: In case qualified employees are laid off, that is rem oved from the pay roll, they will be paid for one-half the guaranteed time or 70 hours per m onth at their full hourly or base rate for such total period o f lay-off within any continuous twelve months’ period, as specified below : P e r io d , o f l a y - o f f i n a n y c o n tin u o u s 12 L e n g t h o f c u m u l a t i v e s e r v ic e 6 1 2 3 m o n th s ’ p e r io d m onths’ service and less than 1 y ear___________ 2 year’s service and less than 2 years_______3 years’ service and less than 3 years_______ 4 years’ service and o v e r ________________________ 6 months months months months 7. Discontinuance of Payments: N o further paym ents will be made to any em ployee under this plan if he is not recalled for work within 6 months from the date of his lay off or if upon demand he fails to reenter the em ploy of the com pany or if he obtains full-time em ploym ent elsewhere. 13. Modification or Termination of the Guaranteed Work Plan: The com pany reserves the right in its sole judgm ent to m odify or terminate this plan at any time. It is hoped that this plan will be permanent but changed laws, con ditions, or relationships m ay require modification or ter mination o f the plan. If for any reason the present base week of 40 hours is changed, an adjustm ent of the plan will be necessary. 45. C erea l preparations— G P (AFL) IV . Guaranteed Hours Bonus: Sec. 1. All em ployees who obtain a seniority of three (3) years or more, and provided such em ployees have reported and worked whenever work was available, shall be guaranteed a minimum of 1,704 working hours including vacation time at the regular existing rates of pay in any calendar year, subject to a deduction for time lost through sickness or accident (actual time that the classification was in opera tion) or shut-down of the mill caused directly or indirectly b y fires, strikes, riots, tornadoes, cyclones, explosions, floods, military or civil com m otion, and other causes beyond our control. A r t ic l e Sec. 2. A ny em ployee, who has attained a seniority of three (3) years’ or more employm ent, and shall, in any week earn wages for less than thirty (30) hours due to work not having been made available, shall be paid for the actual hours worked, and at the em ployee’s request to the auditor, a sum sufficient to make up a total paym ent for thirty (30) hours, with the understanding that the excess paym ent will be collected without interest or other charges in the next following week or weeks in which the em ployee receives in excess of thirty (30) hours’ work. W hen em ploym ent is terminated, for any reason, all excess paym ents becom e immediately due and payable in full. Sec. 3. The com pany agrees not to reduce rates o f pay during the life of this agreement and further declares its intention as follow s: After paying the existing rate of wages to mill employees, and a fair return to its stockholders, which shall be $2.00 per share, the com pany will then divide tw enty percent (2 0 % ) of the remaining net profits as a bonus am ong its mill employees and office employees, strictly on the basis 74 GUARANTEED WAGE PLANS IN THE UNITED STATES of seniority. T he distribution of the bonus is to be made early in the m onth of D ecem ber after the result of the first eleven (11) m onths’ operation is known. periods, shall automatically be added to the permanent list when there is an opening. 27. Guarantee: The em ployer agrees to a guarantee of the equivalent o f forty-five (45) weeks or eighteen hundred 46. C h ew in g gum m a nu factu ring— N o u nion (1,800) hours o f em ploym ent, exclusive of overtime, for each of the permanent employees, the number of which Y our com pany will pay you a large percentage of your has been hereinbefore established at 500, for the period of base pay for from four to thirty weeks, according to your ------- to ------- , and similarly for each succeeding contract length of service, if it has to lay you off for any reason. (c) Y ou are em ployed b y us and agree to give us year. It is understood that the forty (40) hour vacation becomes a part o f the eighteen hundred (1,800) hours. services which are faithful, efficient, and satisfactory to 28. In the event wages, base rates, and hour rates are us, during the period of this agreement, in such capacity increased b y the em ployer to the amount of five percent as we m ay reasonably require; bu t we shall have the right (5 % ) above present wages, base rates, and hour rates, the to suspend your em ploym ent, if conditions of our business employer shall have the right and option at any time there or acts beyond our control require that we lay you off. after to cancel the guarantee o f forty-five (45) weeks or During such periods of suspension of your em ploym ent, eighteen hundred (1,800) hours. Provided, however, that to be known as “ lay-off periods,” we will pay you unem in the event at the time o f such cancellation b y the em ploym ent com pensation for such portion of any lay-off ployer any permanent em ployee or employees have n ot period and in such amounts and upon such conditions as been em ployed the proportionate number of hours based are prescribed in the schedule of unem ploym ent benefits upon the pro rata of eighteen hundred (1,800) hours, as on the reverse side hereof. During any lay-off period, if hereinbefore set forth, the em ployer shall pay to such the com pany so requests, you shall hold yourself ready to permanent em ployee or employees five per cent (5 % ) return to work. of their earnings fr o m ------- o r -------- of any succeeding con 47. B rew ery— BFC (C IO ) tract year, or in the alternative, shall pay to such employee or employees the minimum wage for piece workers or the S e c t io n 7. Lay-Offs and Rehiring: As t o regu lar ca rd hourly wage for time workers, as the case may be, for such employees, the em ployer shall have the right of laying off hour deficit * * * . one or more em ployees in any departm ent for a period of not less than one day nor m ore than one week at a time, 50. P ap er m anu factu ring— B P M (AFL) provided, however, that all employees in a departm ent At our recent conferences I believe the necessity foi be treated equally and im partially and that no em ployee m odifying our present five-year plan and service differen shall be laid off for m ore than tw enty (20) days during the tial was made clear to you. After studying the matter year. The lay-off period shall be between N ovem ber 1 from every angle the following plan has been selected. and April 1. Lay-offs shall not apply to engineers, firemen, A ll people working under the present five-year plan will firemen’s helpers, oilers, and maintenance men. be guaranteed em ploym ent sufficient to am ount to eighty The em ployer shall have the right to lay off any or all percent of their normal full-tim e earnings each period foi of its em ployees in any departm ent where the plant closes eleven periods or forty-fou r weeks in each working year dow n or its output is affected b y an act of God, fire, N o guarantee is made for periods 8 and 9, normally eight explosion, or other calam ity beyon d the em ployer’s weeks which com e in the m iddle of the summer. Every control. fifth or sixth year the eighth period is a five-week period 48. C a sk et m a n u factu rin g— U IU (A FL) instead of a four-week period. Holidays on which the mills do not operate are n ot covered by this plan. A r t ic l e 18. (a) The com pany agrees to guarantee 1,800 hours of w ork and wages per year, including vacation with 51. T o o l an d w ire m a nu factu ring— N o u nion pay, to em ployees covered b y this agreement who have Our guaranteed annual wage policy: Our employees have been in the em ploy of the com pany for five (5) years or a right to be proud o f their com pany’s guaranteed annual more, and who still maintain production standards. wage policy which was adopted by the directors to offer (b) The guarantee described in the foregoing paragraph our workers the most progressive type o f security any shall not be applicable to any em ployee who quits or is com pany can give to its employees. Recognizing that the discharged for any cause during the contract year. When loyalty, cooperation, and ability of our employees are ever employees absent themselves for any reason, their part and parcel of our past and future success as a com pany, period of absence shall be deducted from the guaranteed for the past five y e a r s ,-------Company has pu t into effect workweek herein described. an annual wage policy guaranteeing a minimum o f 1,800 This article shall apply only in the event that the com hours pay annually to each employee with a record o f pany is able to secure materials to enable it to maintain five years’ continuous em ploym ent based upon the senior this number of hours, w ithout operating at a loss, and ity policy o f the com pany. further exceptions as stated in Article 6 o f this agreement. In accordance with the above policy, any qualified em ployee [five years of service] who fails to receive at least 49 . W o m e n ’ s cloth in g m a n u factu rin g— IL G (A F L ) 1,800 hours of work in any calendar year, will be paid b y 10. (b) The tem porary workers, whose efficiency aver the com pany, at the end of each such year, an am ount ages 87% percent o f the base rate for three previous pay equal to cover the balance of the hours not worked up to APPENDIX B.---- CLAUSES IN GUARANTEE PLANS AND CONTRACTS 1,800 hours, less any amounts received in unem ployment insurance benefits, workm en’ s compensation benefits, sickness, accident, and health benefits, and wages received from other regular em ploym ent. Paym ent on the guar anteed annual wage policy will be com puted on the regular base rate of the em ployee. The following rules will govern the guaranteed annual wage policy of your com pany: 1. The term “ continuous em ploym ent” shall include any period during which an employee is serving with the armed services, provided that such em ployee returns to the em ploym ent of the com pany within 90 days of the date of honorable discharge from the armed service. 2. The minimum of 1,800 hours of guaranteed work shall include all vacation allowances. 3. This guarantee applies only to wage earners and shall im mediately cease should the em ployee resign, is dis charged for cause, or should he attain the age of 65, or for any reason whatsoever should he fail to work at least 320 hours in any calendar year. 4. Because of recent unusual turn-over among our em ployees, the benefits of this guarantee are limited to those who were em ployees of the com pany o n ------- . This limi tation will be tem porary and will be rem oved as soon as conditions perm it a return to normal times. 5. The judgm ent of the com pany shall be final on all questions arising under or b y reason of the guarantee and the com pany may at any time m odify or alter the rules or m ay at any tim e terminate the guarantee, although the com pany fully expects to continue it permanently. 6. This guarantee must necessarily be made subject to the restrictions and limitations of any Federal or State laws, either present or future, which of course are beyond this com pany’s control. 52. K n itting m a ch in ery produ ction — U S W (C IO ) A r t ic l e I I . (d) The com pany guarantees to every em ployee, who has com pleted five years continuous service in the em ploy of the com pany at the time of the execution o f this agreement a minimum em ploym ent of 1.200 hours for the year covered b y this contract. All hours worked b y said employee, both straight time and overtime, shall be credited against the 1,200 hours. If the com pany does not provide work fo r any part of the 1.200 hours the em ployee shall be paid for the unworked hours at his straight-time hourly rate. An em ployee who voluntarily leaves the em ploy o f the com pany or who is discharged for cause shall not be entitled to the guarantee. In the event of an em ployee’s failure* to take advantage of available work-hours such hours shall be deducted from the guarantee of 1,200 hours. In the event o f a strike the com pany shall be relieved of its guarantee as to the employees striking. 2. P l a n s W it h E l ig ib il it y R e q u ir e m e n t b u t W it h o u t P r o v is io n f o r M o d if ic a t io n o r A b r o g a t io n of P l a n 53. F o o d ca n nin g an d p reservin g— N o u nion M inimum Workweek Plan: 1. This plan makes available to all qualified employees forty-eight forty-hour weeks of work in each calendar year. In other words, a qualified 75 employee will not be given more than four weeks per year of less than forty hours. 4. T o be qualified, an em ployee must have been on our pay roll continuously for twelve months. It is not neces sary that he have received pay during every week of that twelve months, but he must not have been laid off or discharged, and he must not have quit during that period. 54. R u b b e r g o o d s m anu factu ring— N o u nion (b) T o maintain as near as deemed practicable b y the com pany a workweek of forty (40) hours, and guarantees the undersigned opportunity to work at least sixteen hundred [1,600] hours for the first twelve months this contract remains in force. (c) T o pay the undersigned, for such operation on the basis of the rates established by the base rates schedule in effect from time to time. 55. Shipyard— U S W (C IO ) A r t ic l e V II. Vacations and Guaranteed Annual Em ployment Section A — An em ployee who establishes one year’s continuous em ploym ent as hereinafter defined, shall be entitled to one week’s vacation with forty (40) hours’ pay in advance. Section B— An em ployee who establishes tw o (2) years’ continuous em ploym ent as hereinafter defined, shall be entitled to tw o (2) weeks’ vacation with eighty (80) hours’ pay in advance. Section C— An em ployee who establishes three (3) years’ or more continuous em ploym ent as hereinafter defined, shall be entitled to tw o (2) weeks’ vacation with eighty (80) hours’ pay in advance; and, in addition thereto, the em ployer shall warrant not less than forty-eight (48) weeks’ em ploym ent, including the aforem entioned tw o (2) weeks’ vacation with pay, during each year following the date of this agreement, so long as this agreement remains in full force and effect and this provision •remains without m odification. 56. L im ited p rice variety store— R W D (C IO ) A r t ic l e I : Section 2. All union members with twelve (12) m onths’ seniority are hereby guaranteed an opportu nity to work for the com pany for forty-tw o (42) weeks at full time during the calendar year, and as many other regular girls who are union members are entitled to the same guarantee as business conditions warrant, store by store. Regular salesgirls who are guaranteed under this section an opportunity for forty-tw o (42) weeks’ full time work during the calendar year shall be assured an opportunity to work at least thirty-six (36) hours per week during the remaining weeks of the year. 57. R etail w o m e n ’ s cloth in g— R W D (C IO ) F i r s t , (b) W henever the term “ steady sales clerk,” or “ steady sales clerks,” shall be used in this agreement, it shall refer to such sales employees of the employers who are guaranteed under this agreement a minimum of ten and one-half (IOJ/2 ) months or ten (10) months work in each year, as hereinafter provided. (c) W henever the term, “ steady-extra sales clerk” or 76 GUARANTEED WAGE PLANS IN THE UNITED STATES “ steady-extra sales clerks,” shall be used in this agreement, it shall refer to such sales em ployees o f the employers who are guaranteed under this agreement a minimum of thirtyone (31) weeks or tw enty-nine (29) weeks of em ploym ent in each year, as hereinafter provided. T h i r d . (a) “ Steady em ployees” shall be em ployed for a minimum period of ten and one-half (10%) months in each year b y the em ployer. (b) “ Steady-extra em ployees” shall be em ployed in each year for a minimum period of twenty-one (21) con secutive weeks in the fall season, to comm ence October 1st, and fourteen (14) consecutive weeks in the spring season, to com m ence on M arch 15th. B. P LA N S W IT H O U T R E Q U IR E M E N T EM PLOYEE E L IG IB IL I T Y 1. P l a n s W it h o u t E l ig ib il it y R e q u ir e m e n t b u t w it h P r o v is io n fo r M o d if ic a t io n or A br o g a t io n of P lan 58. R etail fu rs— F W (C IO ) N i n t h . The em ployer guarantees full em ploym ent for a period of ten (10) m onths in each year of this agreement, except as herein specifically provided. During the months of July and August in each year, the work shall be divided equally am ong all of the union em ployees * * *. During the guaranteed period of em ploym ent, if and when a member of the association finds himself overmanned with employees, it is agreed that he m ay and shall submit his situation and difficulties for arbitration in the manner hereinafter provided. The em ployer is to supply all necessary records required b y the arbitrators. If the arbitrators shall reduce the guaranteed period of em ploym ent, the additional lay-off period shall be on the basis of equal division of work am ong all union em ployees. In the event that at any time during the period of this agreement there shall be declared a general strike or a general lock-out am ong the wholesale fur manufacturers in New Y ork City, the union and the association will im m ediately subm it to arbitration as provided hereunder the question of whether there shall be instituted a divi sion of work among all of the union employees hereunder, and the decision of the arbitrators shall be final and bind ing on all parties hereto. 59. R etail fu rs— F W (C IO ) Supplementary Agreement. A. The em ployer guaran tees to all permanent [after a trial period of 2 weeks] em ployees one thousand seven hundred and fifty (1,750) hours of work during each year of the contract. The aforesaid provision shall not apply in only the follow ing tw o instances: 1. An unforeseen catastrophe which makes it physically impossible for the em ployer to furnish one thousand seven hundred and fifty (1,750) hours of work. 2. Where the em ployer actually does not have 1,750 hours of work for the particular year except that an em ployer who violates this agreement b y sending work to outside contractors shall be deemed to guarantee 1,750 hours of work in any event. 2. P l a n s W it h o u t E l ig i b i l i t y R e q u ir e m e n t a n d W it h o u t P r o v is io n f o r M o d if ic a t io n or A b r o g a t io n of P l a n 60. R etail m e n ’ s cloth in g— A C W (C IO ) B. The association and each association member agree to supply to the em ployees em ployed b y the association mem ber a minimum period of em ploym ent of ten months in each year, and to agree to pay all such employees for at least ten m onths in such year. Said ten m onths’ em ploy ment shall be distributed as follow s: September, October, N ovem ber, Decem ber— full tim e; January, February— part tim e; M arch, April, M ay, June— full tim e; July, August— part time. 61. R eta il fu rs— F W (C IO ) 4. The firm agrees to guarantee a minimum of thirtyeight (38) full workweeks per year to all workers as o f ------- . 15. There shall be no dismissal from em ploym ent without just cause during the entire life of this agreement. 15A. During the height of the season the firm has a right to hire additional workers on a tem porary basis, providing that such worker is guaranteed at least 20 weeks of em ploym ent or otherwise agreed upon at the time of hiring. 62. Fur design in g an d pattern m akin g— F W (C IO ) A r t ic l e T w e l v e . The firm agrees that each em ployee shall be guaranteed a minimum of the follow ing number of full weeks of w ork: (a) Fitters— 47 weeks each year, (b) Balance of shop— 46 weeks each year. III. A Full Year’s Guarantee to Part of the Work ing Force Plans that are limited to a part of the working force m ay restrict coverage to selected occupations or departments, classes of employees, designated individuals, basic w ork force, key employees, or basic crew. A. P LA N S W IT H Q U IR E M E N T EM PLOYEE E L IG IB IL IT Y RE 1. P l a n s W it h E l ig i b i l i t y R e q u ir e m e n t a n d W it h P r o v is io n f o r M o d if ic a t io n o r A b r o g a t io n of P lan 63. T ex tile m ill— R W D (C IO ) F if t h , (a) All persons em ployed for a period exceeding six weeks shall be considered permanent em ployees and shall be entitled to seniority rights. All rehirings and lay-offs shall be done in accordance with seniority, that is, the last person hired shall be the first person laid off and vice versa. Each em ployer agrees to em ploy a basic crew which shall not be subject to lay-off at any time except as hereinafter provided. Each em ployer agrees to continue on his basic crew for the period of this agreement, except APPENDIX B.---- CLAUSES IN GUARANTEE PLANS AND CONTRACTS as hereinafter provided, the num ber of em ployees that he has at the present time on the basic crew. Where an em ployer has not previously had an agreement with the union, then the number of the basic crew of such em ployer shall be the number of employees in the category com pre hended b y this agreement which the em ployer has con tinuously em ployed all year round for the tw elve months previous to the signing of this agreement. (b) It is clearly understood and agreed that if at any time during the period of this agreement conditions should arise which the em ployer believes make it necessary for him to obtain a reduction in his staff, the em ployer m ay request from the union permission to reduce his basic crew. The em ployer agrees to show the necessary records with respect to the am ount of business done b y him, etc., to the proper union authorities to enable them to determine whether the request for a reduction in the basic crew is proper. The union shall make a decision within one week after request is made for a reduction in the basic crew as to whether or not the said request will be granted. If the em ployer is not satisfied with the decision of the union in this connection, then the m atter shall im mediately be sub m itted to arbitration as provided for herein. 64. W h o le sa le textiles— R W D (C IO ) 4. Permanent Employees and Lay-Offs: A. All persons em ployed for a period exceeding four weeks shall be considered permanent employees. Permanent employees shall be entitled to seniority rights. B. The em ployer shall have the right to lay off permanent employees and all lay-offs and all rehiring shall at all times be done in accordance with seniority, that is, the last person hired shall be the first person laid off and the last person laid off shall be the first person rehired. During the period of lay-offs there shall be no overtime. C. Each em ployer agrees to em ploy continuously a basic crew of union employees in his employ. This ba ^ c crew shall not be subject to lay-offs during the terms o f this agreement. Each em ployer shall establish a basic crew in his respective establishment b y agreement with the union and the number of such minimum basic crew shall be inserted in each individual agreement with the respective employer. The number in the basic crew shall not be reduced unless there has been an appreciable reduction in business for other than seasonal reasons, or a permanent withdrawal of capital or some unavoidable cause which will make it impossible for the em ployer to continue em ploying all the workers of the basic crew. Thp em ployer shall make such request from the union in writing. Should the union fail to agree to said reduction within 72 hours after such request the matter may be subm itted to arbitration pursuant to the terms of this agreement. 65. W h o le sa le dry g o o d s— R W D (C IO ) 5. All persons em ployed for a period exceeding tw o (2) weeks, shall be considered permanent employees. Per manent employees shall be entitled to seniority rights. All rehirings and lay-offs shall be done in accordance with seniority, that is, the last person hired shall be the first person laid off, and the last person laid off shall be the first 77 to be rehired. The em ployer agrees to continuously em ploy [number] union persons in his em ploy. These shall constitute the basic staff, and shall not be subject to lay offs at any time. 66. W h olesa le dry g o o d s — R W D (C IO ) E ig h t h . A. All persons em ployed for a period o f four weeks (which shall be extended to six weeks upon written notification b y any member of the association to the union with respect to any particular em ployee) shall be considered permanent employees, and shall be entitled to seniority rights, b y department, wherever practicable. Wherever it is practicable an old em ployee (in point of service) may be transferred from one department to another. The oldest man shall have the job wherever he can do the work. All rehirings and lay-offs shall be conducted in accordance with seniority rights, that is, the last person hired shall be the first person laid off and vice-versa. Each em ployer agrees to continue on his basic crew for the period of this agreement, except as hereafter provided, the number of em ployees who are at present time on the basic crew. The members of the basic crew shall not be subject to lay-offs at any time except as herein provided. Should the afore m entioned basic crew work a hardship on any m em ber o f the association at the inception of this agreement, the union agrees to subm it the question of a fair basic crew to arbitration, unless the matter shall be adjusted satis factorily betw een the mem ber and/or the association and the union. In those establishments where prior to this agreement there was no basic crew established, the number o f em ployees to be included in the basic crew shall be adjusted in accordance with the procedure for adjustm ent o f disputes and/or arbitration as hereinafter provided. B. It is clearly understood and agreed that during the period of this agreement, should conditions arise which necessitate a reduction in staff of any m em ber of the associ ation, such m em ber m ay request from the union permis sion to reduce his basic crew to the extent deemed neces sary. Should the union question the need for, or am ount of, such reduction, the matter shall then be subm itted to arbi tration in accordance with the provisions of paragraph Sixteen of this agreement. The union shall be required to answer the request for reduction of basic crew within one week. 67. P u b lic utility— O E (AFL) Guaranteed Annual Incom e: Em ployees who during the past year were included in Schedule A will be retained on schedule A, attached hereto and made a part hereof. Em ployees on this schedule who are paid on a monthly basis will be guaranteed that there will be no deductions from their regular m onthly wage during the period of this contract because of lack of work or inability on the part of the com pany to supply work. Em ployees on the A Schedule who are paid on an hourly basis will be given the opportunity to work 2,080 hours during the year, less vacations and holidays. If in any location the com pany is required to go to a workweek exceeding 40 hours, the men released as a result of the Governm ent edict will be considered to have their guarantee terminated. 78 GUARANTEED WAGE PLANS IN THE UNITED STATES 2. P l a n s W it h E l ig i b i l i t y R e q u ir e m e n t b u t W it h o u t P r o v is io n f o r M o d if ic a t io n o r A b r o g a t io n o f P lan 68. N ew spa per p u blish in g— P P A (AFL) S e c t io n 11. 1. In com pliance with Section 7 (b) (2) of the Fair Labor Standards A ct no individual shall work more than 2,000 hours in any calendar year. 2. Each regular em ployee of the com pany will be scheduled for five shifts a week for each of the 52 weeks in the calendar year in accordance with section 9. New employees may be included as regular employees b y written notice from the com pany to the union. 69. S h o e m a nu factu ring— E A (In d.) A. Definition, Gross Amount, Determination Thereof: The parties hereto agree that the capital, management and labor interests in the business of t h e ------- Com pany shall constitute a true partnership. The parties hereto agree that the drawing accounts as referred to herein * * * shall not be less than * * * per week unless pre scribed b y law and/or the labor market warrants a higher or lower rate. Individual drawing account adjustm ents m ay be made b y agreement between the management and the executive com m ittee of the union. The parties agree that — percent of the wholesale value of the shoes packed during the term of this agreement shall be a fair reward for the labor interest as hereinafter limited, proper adjustm ent being made for reduced value for shoes classed as “ dam aged’ 7 and exceptions as noted herein under title “ Paym ent of Governm ent C ontracts.” M anagement agrees that the salary of individuals named on Schedule “ A ” hereto attached shall not be included in this percentage fund. A t the end of each fiscal year of the com pany, adjustm ents on the number o f shoes packed are to be made, using the same form ula in order that the N et Shoes Packed figure of the entire business will be the same as the N et Num ber of Shoes Packed figure shown on the report o f ------- or any other com petent auditors’ report for the same fiscal year, with exceptions noted herein, under title “ Paym ent of G overn m ent C ontracts” . M anagement agrees to give free access to the necessary, books and records of the com pany and full cooperation once during each calendar year to an auditor or auditors selected b y the union to check the records which pertain to the percentage fund. M anagem ent agrees to publish on the several bulletin boards within the shipping depart m ent periodically at least once each m onth an estimate of the earnings, drawing account, and reserve account paid. M anagem ent will, on due notice and at time convenient to it during regular business hours, permit any qualified agent of the union to audit such com plete accounts as related to the calculation and com putation o f the percentage fund and reserve accounts. B. Payment o f Government Contracts: B oth parties to this contract agree that the sale of shoes made and packed under the United States Governm ent contracts and any shoes packed or sales of such shoes o f a similar and unusual nature shall be treated separately at an agreed rate of percentage different from the rate herein set forth as appli cable to other sales and shoes packed and management agrees that it shall pay to the “ labor interest” its pro rata share of any increase in the price of shoes derived from governmental contracts; provided, however, such increase in the price of shoes derived from governmental contracts shall not include any increase in the price of shoes where governm ental specifications warrant such •increase b y reason of increase in the price of materials. C. Drawing Accounts and Classification of Membership: In order to effect an orderly distribution of the union members’ share of the receipts o f the com pany, the parties agree that a drawing account system, as hereinafter more fully set forth, shall be em ployed. — percent of the whole sale value of the shoes packed during the term of this agree-' ment shall be credited to the aforementioned drawing account by management. That furthermore, all drawing accounts had, except as provided in the section of this contract designated “ Over tim e” , shall be charged to the aforenamed drawing ac count, which said payments have been classified under the heading o f “ Shipping Departm ent Labor” on the books of the com pany. Different groups of employees shall, as hereinafter more fully set forth, constitute the “ labor interest” hereinabove referred to. Each worker in the jurisdiction of the union shall be given a weekly basis which shall be at a rate considered by the management and the union equal to the w orker’ s worth to the organization. T he union agrees, for the purpose of calculating the weekly drawing account of each mem ber of the union during the term o f this agreement, the rate effective on the date this contract is executed shall be taken, especially that due credit or allowance shall be granted for any change made b y virtue o f provisions herein set forth. All account drawings shall be based on a differential rate as herein agreed upon. It is agreed that during the period o f this contract, changes m ay be made in the drawing account rates or wages but shall not becom e effective or paid except upon mutual agreement b y and between management and the presi dent of the union. Such drawing account rates and wages and changes in the drawing account rates and wages shall be held in strict confidence between said management and the president o f the union except, however, wherever said parties shall deem it necessary to obtain the necessary inform ation for an equitable and just change in the draw ing account rates and wages. The drawing account rates of the president o f the union and o f the executive com m ittee shall n ot be redu ced‘during the time o f office because of time spent in the discharge of union business. M anagem ent further agrees that the drawing account rates of the union members named in Schedule “ A ” shall be based upon the same earnings hereinbefore set forth and shall follow proportionately the drawing account rates of other members of the union, but such drawing accounts shall not be charged against the percentage fund. W henever matters pertaining to the drawing account shall not appear to be covered b y this agreement, then such matters shall be settled and com prom ised b y agreement between management and the union, b y their respective representatives. APPENDIX B.---- CLAUSES IN GUARANTEE PLANS AND CONTRACTS If during the term of this agreement, the total drawing accounts paid shall exceed — percent of the wholesale value of shoes packed during the term of this agreement, with exceptions as noted for G overnm ent contracts, and the management is convinced that such excess will not be balanced autom atically back to the agreed basis during the remaining period of the contract, then the weekly drawing account shall be revised downward to a base which, it is expected, will equal — percent of the wholesale value of the shoes packed during the term of this agreement (adjustm ent being made for the reduced value of shoes classed as “ dam aged77 and shoes produced under govern mental contracts). The said “ labor interest77 as hereinbefore referred to, shall consist of the following classifications of membership and the rights, interests, and benefits of each of such classifications: “ The Class A membership shall consist of — percent o f the total number of shipping departm ent workers, not including the direct agents of management as enumerated in Schedule B attached hereto as of M arch 4, 1946, and with the exception of those workers who, because of dis qualifications as hereinafter more fully set forth, were unable to attain the said Class A membership. The Class A worker shall consitute a permanent labor force and shall n ot be subject to lay-offs. However, no em ployee shall becom e a Class A m em ber until he or she has had at least tw o years of service in the shipping department of the ------- Com pany or at least tw o years of service in the office or factory of the M ilwaukee plant of t h e ------- Com pany. “ As heretofore set forth, the total membership of Class A workers is lim ited to — percent of the total number o f shipping departm ent workers, and includes those Class A mem bers and workers who attain a Class A membership while on leave of absence; it being understood and agreed that care m ust be taken that the rights of all workers who are on leave of absence are preserved when prom otions to Class A m em bership are made. “ The Class B membership shall consist of all those workers, except those hereinafter or hereinbefore classified as otherwise, who have been em ployed at th e ------- Com pany (shipping department) for a period of at least tw o years. These said Class B members shall im mediately begin to participate in the Share Production Plan at the com m ence ment of the first four-week period after the second anni versary o f their em ploym ent, and they shall be entitled to all the rights, interests, and benefits of the Class A membership, except that they m ay be subject to lay-off in accordance with the terms of this contract. “ The Class C membership shall consist of all workers who had n ot reached the age of forty-five years at the time o f their com m encem ent of em ploym ent at t h e ------Com pany, M ilwaukee plant, such members, of course, being members in good standing in the Union of ------Shipping D epartm ent Em ployees, bu t who have served less than tw o years. “ The Class D membership shall consist of those workers who are forty-five years of age or more at the com m ence ment of their em ploym ent with the com pany and who have not previously earned a higher classification hs hereinbefore set forth. 79 “ The Class D B membership shall consist of those Class D members who have com pleted two years of em ploym ent with the com pany and who are eligible to the Share Production Plan. The same is hereinbefore explained in reference to Class B members. However, such Class D B members shall at no time be eligible for prom otion to Class A membership. “ The Class H A membership shall cpnsist of those workers who were previously classified as Class A members but, who, because of their physical or mental impediments, were unable to perform the minimum work provided in the various shipping department schedules and conse quently were taken out of the Share Production Plan. Such members are to be paid on an hourly basis. Other wise, they shall have the same rights and benefits of the Class A membership with respect to lay-offs. “ The Class H B membership shall consist o f those workers who were previously classified as Class B members but who possessed some physical or mental im pedim ent and could n ot perform the minimum am ount of work provided in the various shipping department schedules and consequently were taken out of the Share Production Plan. Such members shall be paid on an hourly basis.77 Class B members shall be prom oted to Class A member ship according to seniority upon vacancy occurring in the Class A membership hereinbefore set forth and agreed upon as being limited to — p e r c e n t-------of the total number of shipping department workers (including those Class A members on leave of absence) due to death, resignation, discharge, or permanent term ination of em ploym ent. Provided, however, if there are no members in the Class A membership, then the Class C members shall be prom oted to Class A membership according to seniority upon vacancy occurring in the class A membership hereinabove set forth and agreed upon as being limited to — percent -------of the total number of shipping department workers (including those Class A members on leave of absence) due to death, resignation, discharge, or permanent term ination of em ploym ent; provided, further, however, that such Class C members shall have at least tw o years7 service record at the Milwaukee plant of t h e ------- Com pany. All Classes A, B, and D B members are to share in the percentage fund in accordance with their basic rate and the present existing agreement with management. All Classes B and D B members may be laid off when production needs ara not sufficient to maintain Class A members working at least forty hours per week. In the event of necessity of lay-off, there shall be no discrimina tion between Class C and Class D members, except on the basis of seniority rights. And, furthermore, in the event of a further lay-off, there shall be no discrimination between Class B members and Class D B members, also, except on the basis of seniority rights. Classes H A , H B , C, and D members are wage earners and work for a stipulated amount per hour, the total of their wages being paid out of the gross share before any balance is allocated to the accounts of Classes A, B, and DB. Earnings of Classes A, B, and D B members are to be allocated to the individual account of each of said members, that member being paid in cash any balance to his or her 80 GUARANTEED WAGE PLANS IN THE UNITED STATES credit after providing for a reserve fund of nineteen percent (19% ) of his or her annual estimated income, which said reserve includes provision for sick leave as hereinafter more fully set forth. The adjustments on said individual account shall be made at the end of each four-week period, and when the reserve in each individual account exceeds nineteen percent (19% ) of the annual estimated income, the excess shall be paid during the following four-week period, permission being granted to management to include said excess in the regular weekly drawing. Management further agrees to pay interest on the balance in the individual reserve accounts of the said Classes A, B, and D B members at the same rate as is currently being paid b y banks on savings deposit accounts (currently agreed at 1 % per annum), except, however, such computations shall be made at the end of the four-week period in accordance with the adjustm ent made on the individual account of each member. It is further agreed that jobs shall be made available to those members of the union who are on leave of absence because of their service in the armed forces of the United States or its auxiliaries; and provided that he or she is physically able to accept such em ploym ent, and provided further that such m em ber of the armed forces of the United States or its auxiliaries gives the stipulated notice of his or her discharge from the said armed forces of the United States or its auxiliaries and his or her desire to return to em ploym ent in accordance with the Selective Training and Service A ct of 1940 (Section 8), the Arm y Reserve and R etired Personnel Service Law of 1940 (Section 3), the Service Extension A ct of 1941 (Section 7), The Servicemen's R eadjustm ent A ct of 1944 (Section 600-607), and the W ar M obilization and Reconversion A ct of 1944, and the amendments thereto. It being under stood b y the parties hereto that such members on leave of absence, upon reem ploym ent, shall return to their respective positions or jobs which they had possessed at the time of their induction into the armed forces of the United States or its auxiliaries, taking into, consideration the fact that their seniority record continues while in the armed forces of the United States or its auxiliaries. In other words, the veteran is entitled to reinstatement in his form er position (1) if the position was not a tem porary one; (2) if the veteran left the position subsequent to M ay 1, 1940, to enter active m ilitary or naval service in the land or naval forces of the United States; (3) if he is still qualified to perform the duties of such position; (4) if he makes application within ninety days after he is relieved from training and service or from hospitalization continuing after discharge for a period of not m ore than one year; (5) if the circumstances at the ------- Com pany are not so changed as to make it impossible or unreasonable to reinstate a veteran to his form er position or to a position of like seniority status, pay, or drawing. Provided further, however, that nothing herein contained shall affect those workers who shall enlist in the service of the M erchant Marine after August 14, 1945, it being understood that service in the M erchant Marine is of a private nature and compensable accordingly. Management agrees that those employees within the jurisdiction of the union, whose payments have not been classified under the heading of “ Shipping Departm ent L a b or" on the books of the com pany in the past such as the employees named in Schedule A, shall receive com pensation in a m ethod and at rates and adjustm ents par allel to the members working under the aforem entioned drawing account system. It is agreed that during the period of this contract, changes m ay be made in the differential base rate upon mutual agreement b y and between management and the executive com m ittee of the union. I t is further agreed, for the purpose of calculating the drawing account of each individual m em ber of the union, the present differential rate shall be the basis of calculation. H ow ever, adjustments in individual differential rates m ay be changed during the period of this agreement, bu t such individual adjustments shall not be effective or paid until approved b y the president of the union; provided, further, as hereinbefore set forth, the differential rates of the president of the union and the members of the executive com m ittee shall not be reduced during the time of office because of time spent in the discharge of union business. D . Stabilized Annual Incom e: For the purpose o f stabi lizing annual earnings o f the workers o f the com pany in the union's jurisdiction, it is agreed that each Class A, B, and D B m em ber shall receive at least one drawing for each week that this agreem ent is effective, and that the am ount of such drawing will be at least one fifty-second (%2) o f the m em ber's estimated yearly income, except as that estimated yearly incom e m ay be changed in accord ance with the provision perm itting adjustm ents o f the individual rates. H ow ever, for the purpose o f establish ing in the shipping departm ent uniform ity of drawings for absence, due to illness, the union agrees that each Class A, B, and D B m em ber shall be entitled during the term o f this contract, to five (5) days o f absence, with drawings, for recognized cause. E. Reserve and Overdraft: The parties agree that it is highly advisable to establish a reserve in the workers’ fund of each individual Class A, B, and D B m em ber, in such instances as hereinbefore set forth, in order to guard against the disruptance o f drawing schedules due to ad verse business conditions and both parties agree to pro m ote the accumulation and maintenance o f such reserve accordingly. C om m en cin g ------- this reserve shall consist o f nineteen percent (19% ) of the annual estimated income, the same being com puted b y multiplying the present average hourly drawings b y 2,080. The said nineteen percent individual reserve account shall include drawings for five (5) sick days. H owever, management shall con tinue to pay the regular weekly drawings including weeks with holidays, vacation, and five (5) days' sick leave, if b y so doing the individual reserve is n ot reduced below five percent (5 % ) o f the annual estim ated incom e, bu t no m onthly or adjusted compensation paym ents will be had if by so doing the said reserve is reduced to a sum less than nineteen percent (1 9 % ) of the annual estimated income. W hen it is apparent that due to adverse business con ditions, the said reserve account shall be depleted if no change is made, the drawing account rate shall be revised b y agreement betw een the management and the executive APPENDIX B.---- CLAUSES IN GUARANTEE PLANS AND CONTRACTS com m ittee o f the union to a point where the reserve account will at no time be less than five percent (5 % ) of the annual estimated income, except as hereinafter stated management shall pay a premium for vacation. F. Payment of Wages and Drawing Account: The mini mum drawing account rate to be paid during the life of this contract shall be set b y mutual agreement between management and the executive com m ittee of the union. M embers recognized as substandard b y the Fair Labor Standards A ct authorities may be paid at a rate approved b y said authorities. In com puting the fair rewards for labor and establishing a minimum paym ent o f wages and/or drawing accounts, the present and existing M inimum W age and Hour Law was taken as a basis and, therefore, provisions in this contract as therein stated shall be subject to change in the even t the G overnm ent shall increase the minimum wage. 70. C e m e n t m a n u factu rin g— U S W (C IO ) X . (d) During the p e r io d -------t o -------- , the com pany will work eight (8) men forty (40) hours a week. It is under stood that length of continuous service shall govern the selection of these eight (8) men. 81 74. W h olesa le dry g o o d s — R W D (C IO ) The em ployer agrees that his basic staff shall consist of -------union employees. Of these, the em ployer shall em ploy ------- persons as general help, ------ persons as office h e lp ,-------persons as salesmen, buyers, or credit men. The union shall not insist that the basic staff of the em ployer in each category be filled except that if, during the life of this contract, the union shall feel that one or more vacant positions on the said basic staff should be filled, that the request for same shall be made to the em ployer, and upon failure of the em ployer to agree to the union’s request, then the m atter shall be considered a grievance and be subject to arbitration as provided for in the contract. The failure of the union to demand replacements of vacant basic staff positions, shall not be deemed a waiver of the union’s right to subsequently make such a demand. Upon the request of the union showing the necessity for filling one or m ore vacant staff positions, the em ployer shall be required to immediately fill same. The failure of the em ployer to fill a vacant basic staff position, when one has becom e or will becom e vacant, shall not be deemed a violation of the contract. 75. R etail m e n ’ s cloth in g— R W D (C IO ) 71. R eta il a u to m o b ile s— U A W (C IO ) 4. All men listed on Exhibit “ A ” are permanent em ploy ees under the 52-week work clause; all other employees hired shall be tem porary employees and inform ed to that effect when they are hired. 72. C lean in g an d dy ein g — A C W (C IO ) The em ployer shall not at any time reduce the wages or earnings of any em ployee who earned or may hereafter earn m ore than the minimum scale provided for herein and all weekly em ployees shall receive their full pay each week in the year regardless of whether there has been sufficient work to keep them occupied full time during the week. This covers all inside cleaning and dyeing workers (about 500 in number) in shops under contract w it h -------[union], B. P LA N S W IT H O U T R E Q U IR E M E N T 1 EM PLOYEE E L IG IB IL I T Y 1. P l a n s W it h o u t E l ig i b i l i t y R e q u ir e m e n t b u t W it h P r o v is io n for M o d if ic a t io n or A b r o g a t io n of P l a n 73. K nitting mill— N o union It is hereby agreed (1) T o operate under a guaranteed work plan for a period of 52 weeks beginning ------- and en din g-------, during which annual period the said em ployees shall be guaranteed work for fifty (50) weeks of forty (40) hours per week, or eight (8) hours per day, provided however, that the said [com pany] shall not be bound to the said fifty (50) weeks of forty (40) hours per week, or eight (8) hours per day for causes beyond its control. (2) The parties hereto m utually agree that the rates of pay during the life of this agreement shall be in accordance with the wage schedules set forth in detail in Schedules A and B attached hereto and made a part hereof. A salesman m ay be discharged upon tw o weeks’ written notice b y the em ployer to the union, sent b y registered mail, and with the written consent of the union. Such notice b y the em ployer to the union, requesting such dis charge, shall set forth the details impelling this request for the discharge. (Slack season, however, shall not be deemed a cause or a reason for the discharge of a regular salesman.) Upon the consent in writing, b y registered mail, given b y the union, such salesman affected by the notice shall be discharged at the end of such tw o weeks’ period of notice. 76. R a ilroa d repair an d m a in ten an ce— F S C (A FL) Agreement With the Federated Shop Crafts Providing for M inimum Force: (a) It is agreed between t h e ------- Rail way and the Federated Shop Crafts that duripg the entire m onth of J a n u ary------- a minimum force of 2,300 positions o f mechanics, apprentices, helpers, and coach cleaners will be em ployed in the maintenance of equipm ent departm ent; this num ber o f positions to be distributed over the system of crafts and at points as shown on the attached statement and as hereinafter provided and will work six days a week. It is further agreed that this minimum force of 2,300 positions will be continued from month to month during the entire year ------- on the six-day-week basis, unless changed in accordance with the provisions of section (e ). (e) It is further understood and agreed that in event any situation arises during the life of this agreement which would seriously affect either party, a conference will be held between the management and the general com m ittee for the purpose of reaching an agreement. In event of failure to do so, it is understood and agreed that either party m ay terminate this agreement b y serving ten (10) days’ notice in writing upon the other of intention to do so. 82 GUARANTEED WAGE PLANS IN THE UNITED STATES 77. R e frig era tor car serv icin g — U P W (C IO ) A r t ic l e I. Working Hours: T he basic gang em ployed b y the em ployer hereunder shall consist of three mechanics, tw o helpers, and one car washer. Each of such men shall be em ployed b y the em ployer for tw o thousand hours during the period of one year covered b y this agreement, and shall receive weekly paym ent on the basis of forty hours per week irrespective of the number of hours worked b y him in any such week at the regular scale of wages here inafter provided; except that if the hours worked b y any such em ployee under the jurisdiction of this contract are in excess of eight hours in any workday, or in excess of forty-eight hours in any workweek, as the case m ay be, such excess hours shall be paid for at the rate of time and one-half regular scale rate for which he is em ployed, pro vided, however, that in the event of storms, floods, acts of God, death, discharge, incapacity of employees, or condi tions beyond the control of the em ployer, such aggregate number of tw o thousand work hours cannot be com pleted in the period covered b y this agreement for any em ployee, there shall be a reduction of such total number of hours corresponding to the num ber of hours which b y reason of said conditions, it was im possible to complete. In the event the em ployer ceases the operation of refrigerator cars in the service o f ------- Com pany, this con tract will be void on 30 days’ written notice. There will be no replacements of the basic gang by reason o f tem porary reduction caused b y sickness or for vacations. This agreement shall relate only to employees of the em ployer a t ------- and does n ot apply to superintendents, foremen, and clerks. 78. P u b lic utility— O E (A F L ) A r t ic l e IX . Guaranteed Work: Section 1. T w o Year Guarantee, (a) Class A em ployees as defined in Article V III, Classification of Em ployees, Section 1, are included in the Guaranteed W ork Plan as hereinafter provided for. Class B and Class C em ployees are n ot included in the Guaranteed W ork Plan. (b) The com pany agrees to provide work at wage rates agreed upon b y the com pany and the union, for a period of tw o (2) years from the effective date of this agreement, to all Class A em ployees as provided for in Article V III, Classification of Em ployees, of this agreement. It is further agreed that should a decrease in work, due to changing conditions in any plant or department, require a reduction in personnel, em ployees not under the Guaranteed W ork Plan will be laid off first. Should further reductions be necessary, it is agreed that em ployees with the least seniority under the Guaranteed W ork Plan may be trans ferred to other departments or plants where their services are required at existing rates for the jo b to which they are transferred. It is further agreed that should such transfers becom e necessary, such em ployees will be paid a relocation wage differential equivalent to the difference between their form er rate and their new rate for a period of six (6) months follow ing their transfer. In no case shall the wage differ ential paym ent exceed thirty percent (30% ) of the em ployee’s average m onthly wage during the last twelve (12) months in his regular employm ent. (c) Those employees who are guaranteed work under this article will be given an opportunity to work 2,080 hours during each o f the guaranteed w ork years, less vacation and holidays. (d) A schedule shall be subm itted to the union listing the names o f em ployees who are guaranteed work. (e) The right by the com pany to suspend or discharge an em ployee for cause as provided for in this agreement shall in no way be infringed upon through the application or in terpretation of this article. 2. P l a n s W it h o u t E l i g i b i l i t y R e q u ir e m e n t an d W it h o u t P r o v is io n f o r M o d if ic a t io n o r A b r o g a t io n o f P l a n 79. F lou r m ill— C W (AFL) It is agreed upon by the union and the em ployer that the base crew of sixty-tw o (62) men in the mill, feed plant, elevator, mill engine room , and other miscellaneous activ ities will be guaranteed a minimum workweek of fortyeight (48) hours for the whole 12 months, the last 8 hours to be on time and one-half, and if there is not sufficient work to com plete the 48 hours during any week with ex ceptions of those weeks that include holidays designated by the union contract, then [company] will pay each and every em ployee his wages for any hours not worked up to 48 hours. 80. T ex tile d y ein g an d fin ish in g— M P (In d .) S e c t io n I. Salary and Hours: The com pany agrees to continue to em ploy the members of the association now presently in the em ploy o f the com pany throughout the period beginning with t h e ------- and ending with t h e -------- , and guarantees to pay to each journeym an printer operat ing from seven to eight color machines total wages for said period of not less than thirty-eight hundred fifty-eight dollars and forty cents ($3,858.40), and further guarantees to pay each journeym an printer operating from nine to twelve color machines total wages for said period of not less than four thousand forty-five dollars and sixty cents ($4,045.60), payable weekly at the respective rates per week of seventy-four dollars and tw enty cents ($74.20) and seventy-seven dollars and eighty cents ($77.80). The com pany agrees that each of the said mem bers of the association in the em ploy of the com pany throughout the period covered b y this contract shall, su bject to and in accordance with the provisions of this contract, w ork not m ore than tw o thousand (2,000) hours during the period of fifty-tw o (52) calendar weeks of the period covered b y this contract. 81. S oa p m a n u factu rin g— S W (C IO ) A r t ic l e III. Section 2. All departments except watchmen and firemen will operate on the five (5) days basis M onday through Friday. W atchm en and firemen who must be in attendance at all times, will work on all days, M onday through Sunday, at regular time. W atch men and firemen will be guaranteed fifty-tw o (52) weeks of work per year during the time this contract is in effect. 83 APPENDIX B.— CLAUSES IN GUARANTEE PLANS AND CONTRACTS 82. E lectroplating— E R M W (C IO ) 89. R etail ic e and coa l— O E (AFL) X V II I. The em ployer guarantees to the five mainte nance men named in the contract between the parties, d a t e d -------, not less than forty-eight (48) hours of work, or the m onetary equivalent thereof, in every week during the fifty-tw o (52) week period which is the term of this contract. The em ployer also agrees 'to pay the abovementioned maintenance men for the holidays named in this contract, even though these maintenance men shall not be required to w ork on these holidays, and to continue to grant to the maintenance men all the benefits and privileges which they have heretofore enjoyed. Wages, Hours, and Working Conditions: On and after -------the following schedule of wages and hours shall be in effect: The engineer-in-charge shall receive tw o thousand seven hundred ($2,700.00) dollars per year. Operating engineers shall receive tw o thousand ($2,000.00) dollars per year. Time in excess of fifty-six (56) hours per week, or over twelve (12) hours in any one day, shall be considered overtim e and shall be paid for at the rate o f time and one-half time. N o em ployee working under this agree ment may work over tw o thousand (2,000) hours per year. Em ployees working under this agreement work according to Section 7 (b) (2) of the Fair Labor Standards Act. 83. W h o le sa le sirup distribu tion — R W D (C IO ) E very permanent routeman and cook working for the members of the association are hereby guaranteed fifty-tw o weeks of steady em ploym ent in each year at the scale of wages herein mentioned throughout the life of this agree ment. Permanent helpers shall during the slack period share the work. 84. R eta il m e n ’ s cloth in g— A C W (C IO ) S i x t e e n t h . Annexed hereto and made part hereof is a schedule of the names of the salesmen, stock clerks, and other employees and their salaries, em ployed by the em ployer who are protected under the terms of this agreement which shall be the minimum amount of salesmen, stock clerks, and other em ployees that the em ployer agrees t o em ploy throughout the life of this agreement. N in e t e e n t h . It is further agreed that in the event that a m em ber or members of the union leave his or their em ploym ent with the em ployer, that the em ployer shall im mediately fill such vacancy with another member or members of the union. 85. R eta il m e n ’ s cloth in g— A C W (C IO ) 2. The bushelman working for the members of t h e ------Society are guaranteed 40 hours o f work per week, 52 weeks per year. 86. R etail sh o e s— R W D (C IO ) 6. During the period covered b y this agreement, em ployer agrees to give continuous em ploym ent to minimum force of em ployees as hereinafter stated: manager, 1 selling assistant manager, 2 salesmen, cashier, and 1 porter. the a 1 1 87. R etail fu rs— F W (C IO ) That the following em ployees [names of seven em ployees] are to be considered permanent employees and will be guaranteed fifty-tw o (52) weeks f r o m -------t o -------exclusive of overtime. 88. R eta il liquor— R C (AFL) 3. (B) The em ployer agrees that each sales clerk in his or its employ shall have fifty-tw o consecutive weeks of em ploym ent during each year. 90. R etail den tal su pplies— N o union W it n e s s e t h : Said em ployer agrees to em ploy said em ployee a s ------- for a term of one (1) year from the date hereof, at a weekly salary o f -------. In consideration of the foregoing on the part of said employer, said em ployee hereby accepts such em ploym ent at said salary and agrees that he will diligently and faith fully apply himself to and perform the work of said em ployer as he m ay be directed to do b y its fully accredited representative; that he will not absent himself from the em ploym ent of said em ployer (except in case of illness), without the consent of said em ployer; that he will not during said term of em ploym ent, nor for one year there after, engage either directly or indirectly in any branch of business carried on b y said employer, either as a party in interest or as the em ployee of another concern conducting a similar business anywhere in the cities of Providence, R hode Island; or Bridgeport, Hartford, or New Haven, in the State of Connecticut; or Boston or Springfield in the State o f Massachusetts. 91. W a ter transportation— IL A (AFL) F o u r t h . The com pany further agrees that the following positions shall be guaranteed twelve (12) months pay at rates of pay as shown and with not less than tw o (2) weeks vacation. General forem an____ Assistant forem en___ Chief clerk__________ Rate clerk___________ Stenographer________ General cashier_____ Baggagem an________ C ity passenger agent. C ity freight agent___ T icket agent________ $296. 236. 236. 203. 170. 170. 165. 253. 253. 236. 12 72 72 72 72 72 22 22 22 72 m onthly m onthly m onthly m onthly m onthly m onthly m onthly monthly m onthly monthly The com pany further agrees that seasonable workers shall be em ployed from the opening of navigation to the closing of navigation; the following positions classed as seasonable with m onthly rates of pay as enumerated below. 84 GUARANTEED WAGE PLANS IN THE UNITED STATES T icket sellers______________ $159. 72m onthly Assistant cashiers________ 148. 72m onthly Night clerks______________ 143. 22m onthly 132. 22m onthly Telephone operator______ Com ptom eter operator___ 132. 22m onthly Assistant settlement clerk. 132. 22 m onthly 132. 22m onthly T ypists______________ Billing clerks_____________ 132. 22m onthly Scale of wages shall be not less than as shown above. Also all employees shall have one (1) day per week off and in the event any em ployee m ay be requested to work the seventh (7th) day such duties will be performed at overtime rate. In the event of a dispute arising between the com pany and the union or in the event of the employees or em ployer having a grievance they shall continue to work and all such questions in dispute controversies and grievances shall be settled if possible b y the representatives of the com pany and the representatives of the union. 92. C lean ing and d y e in g — N o union 1 Employment Contract: . The em ployee shall enter into service and com m ence his work hereunder on the ------- and the em ploym ent shall continue for the period of one year, and for such further period as is provided for herein. 93. N e w s sy n d ica te— C T U (A FL) S i x t h , (a) The em ployer guarantees to pay at least one-half pay of the full weekly wage to a total of fortythree (43) M orse operators in every week throughout the year. Seniority shall govern as usual in all cases, it being agreed that the senior men shall fill all jobs as available. M en on leave of absence am ong the 43 em ployees of highest seniority will have their places filled in the listed 43 b y substitution of the employees highest in the list of seniority under the top 43 employees during the time covered b y the leave of absence only. IV. Less Than a Year’s Guarantee to Part of the Working Force Plans in this group provide a guarantee o f em ploym ent or incom e for som e definite period (3 months to 50 weeks) to such em ployees or groups o f em ployees as are specified. A . P LA N S W IT H Q U IR E M E N T EM PLOYEE E L IG IB IL I T Y RE 1. P l a n s w it h E l ig i b i l i t y R e q u ir e m e n t a n d w it h P r o v is io n f o r M o d if ic a t io n o r A b r o g a t io n of P l a n 94. W a ter transportation— IL A (A F L ) R u l e 21. It is agreed that eight (8) regular terminal em ployees who are paid on an hourly basis shall be guar anteed a minimum o f fifteen dollars ($15.00) per week each, from beginning o f the navigation season on the Upper Mississippi R iver to the end; provided, that in the event operations are suspended due to river conditions, or for any other cause beyond the control of the com pany, the guarantee shall n ot apply during th e period o f sus pension. 95. R a d io b roa d ca stin g — A F M (A F L ) Quota: 1. The station agrees to spend each year during the term o f this agreement not less than the total sum o f tw enty-one thousand five hundred tw enty-eight dollars ($21,528.00) for com pensation for its staff musicians. Personnel: 2. The station agrees to em ploy not less than eleven (11) staff musicians, including a leader, for thirty-nine (39) weeks o f each year, except during the months of June, July, and August, when it will em ploy at least one (1) staff musician who shall be a leader, and as m any m ore staff musicians as it m ay require. A staff musician is one who is paid at a weekly rate and not at a single perform ance rate. T he station shall have the right to use all o f its staff musicians in any way or com bination desired on each broadcast, it shall have full control o f the instrumentation desired and of the program and selection o f music, and m ay use staff musicians on comm ercial and sustaining programs. T he local will’ furnish the station as required b y it, com petent and qualified musicians in good standing in the local. Term: 5. * * * If during the term of this contract the [union], or any local thereof takes any action resulting in the interruption o f network service, or network musical programs, or the service o f the local to the station, the station m ay suspend this contract as long as such inter ruption continues. It is further provided that should the station, during the term o f this contract, lose its present network service, this contract shall terminate at the same time such network service terminates. It is further provided that this contract shall also be term inated should the operation of this station be discontinued because of the loss of proper license, war, act of God, or m ajor catastrophe. 2. P l a n s W it h E l ig ib il it y R e q u ir e m e n t b u t W it h o u t P r o v is io n f o r M o d if ic a t io n o r A b r o g a t io n of P l a n 96. L im ited p rice variety store— R W D (C IO ) Steady Employment: (a) ’ For Regular Salesladies. A regular saleslady with 12 m onths’ continuous experience, in charge o f one or m ore departments, will be given an opportunity to work 42 weeks full time during the year and an opportunity to work at least 36 hours per week during the remaining 10 weeks. It is understood that the vacation period is included in the 42 weeks full time. It is also understood that this is the minimum am ount of work that will be given to any qualified saleslady, and that whenever possible these girls will be given more full-time work. Regular girls with less than 12 m onths’ experience will be given preference at all times in the allotm ent o f the remaining work. 97. R eta il w o m e n ’ s cloth in g— R W D (C IO ) M inimum of Employment in Each Year: Third, (a) “ Steady sales clerks” shall be em ployed for a minimum period of eleven (11) months in each year b y the employers, 85 APPENDIX B.---- CLAUSES IN GUARANTEE PLANS AND CONTRACTS except those employers who maintain establishments on Division Street, in the Borough of Manhattan, C ity of New Y ork. The “ steady sales clerks” em ployed in the establishments located on D ivision Street shall be em ployed for a minimum period o f ten and one-half (10K) months in each year. (b) “ Steady-extra sales clerks” shall be em ployed in each year for a minimum period o f nineteen (19) con secutive weeks in the fall season, to commence October 1st, and tw elve (12) consecutive weeks in the spring season, to com m ence on March 15th, except in the estab lishments o f em ployers located -----------. “ Steady-extra sales clerks” em ployed in the establishments located ------shall be em ployed in each year for a minimum period o f eighteen (18) consecutive weeks, in the fall season, to comm ence on O ctober 1st, and eleven (11) consecutive weeks in the spring season, to com m ence on March 15th. 98. R esta u ran t— H R (A FL) A r t ic l e V : Sec. 2. Steady bartenders shall receive a guarantee of em ploym ent at no less than minimum rate at least forty-eight (48) weeks out o f the year; said year to com m ence on the date [when] this agreement shall go into effect. 99. C em etery — F T A (C IO ) X I. (a) The regular employees, Class B, will be em ployed in the follow ing manner: In each year between the first M onday in April and the first M onday in Decem ber the Cem etery shall provide each of said employees with a minimum period of thirty-three (33) weeks of em ploy ment during which period said employees shall work on all working (bell) days. Within such period the Cemetery shall have the right with respect to each em ployee to determine when his thirty-three (33) weeks’ em ploym ent shall com m ence. T he Cemetery may also em ploy men in this classification prior to the first M onday in April in each year for such period and on such days as it may deter mine, but such em ploym ent shall be in addition to and not included in the thirty-three (33) weeks’ em ploym ent hereinbefore provided for. The em ployee may, however, at his discretion, refuse such additional employm ent. (b) The Cem etery shall be under no obligation in main taining the regular B basic crew figure (Article X I I here of) , or in voluntarily replacing a man when the number of regular B ’s exceed such figure, to guarantee the em ployee involved work after the first M onday in Decem ber of a current contract year; the purpose and intent hereof being that if a regular B is taken on for any reason after April 20th, such regular B shall not be entitled to em ploy ment, during a current contract year, after the first M on day in Decem ber. 100. W a ter transportation— M M P (A FL) R u le 4. (a) All regularly assigned masters and pilots shall be guaranteed ten (10) months em ploym ent during each calendar year. The list of regular em ployees shall be limited to the number required to operate the vessels regularly in service in each division. Other employees covered by this agreement who are called for relief or tem porary duty shall be considered as extra employees Only those em ployees who appear on the regularly assigned list at the beginning of the calendar year or at the begin ning of the navigation season in the case of the Upper Mississippi Division, the Illinois Division, and the Missouri Division shall be considered as regular and included in the terms o f this guarantee. B. P LA N S W IT H O U T R E Q U IR E M E N T EM PLOYEE E L IG IB IL IT Y 1. P l a n s W it h o u t E l ig i b i l i t y R e q u ir e m e n t B u t W it h P r o v is io n f o r M o d if ic a t io n o r A b r o g a t io n of P l a n 101. T ex tile d y ein g and finishing— M P (In d .) S e c t io n 3. The com pany agrees to pay each journey man printer and apprentice full pay for any period prior to July 15th during which the journeym an printer or apprentice is not em ployed. The com pany further agrees to pay each journeym an printer or apprentice one-half pay for any period after July 15th to Decem ber 3 1 ,-------during which the journey man printer or apprentice is not em ployed. It is further understood and agreed that any member of the association who treports for work or who works at any time during any three days of any calendar week, shall be paid wages for the full calendar week, regardless of whether or not said journeym an printer or apprentice works the full forty hours. Any journeym an printer or apprentice who works or reports for work on less than three days, shall be paid a full day’s pay for the day h$ works or reports for work and half pay for the days that he does not work. It is further understood and agreed that during the period beginning with the date o f July 15th and ending D ecem ber 31st, -------, the com pany will spread the work among the members of the association to the end that, insofar as practical, em ploym ent will be shared equally by the members of the association. It is further understood and agreed that during the period covered by this agreement the com pany will alternate the men weekly between the day and the night shifts. I f hostilities should terminate prior to July 1 5 ,-------, or if orders or directives of the Government, issued prior thereto, confront the industry with a curtailment of business which reduces operations, the parties, on fifteen days’ notice, b y either to the other, shall negotiate with respect to the advisability of maintaining or m odifying the full work guarantee contained in this Section 3. 102. T ex tile dy ein g an d finishing— T W U (C IO ) 21. The firm does hereby guarantee 48 weeks o f work in each year for truck drivers and helpers but this guarantee shall be nevertheless subject to the following conditions: (a) In the event of an unusual slack period or in a period o f emergency where production materially decreases the firm shall have the right to lay off drivers notwithstanding the guarantee above-m entioned. Truck drivers and helpers can be em ployed for a period of 50 hours in any one given week. Any excess o f 42% hours in one week (M onday to Friday, inclusive) or 8% 86 GUARANTEED WAGE PLANS IN THE UNITED STATES hours in one day shall be paid for at the rate of time and one-half. 103. W a ter transportation— M E (C IO ) A r t ic l e V : Season of Employment. The season of em ploym ent for officers, boiler-room engineers, junior engineers, and handym en shall be for ten (10) calendar months, 306 days. The season of em ploym ent for all officers to start as directed b y the management and to be continuous, and to be com pleted within the calendar year. If officers, boiler-room engineers, junior engineers, or handym en who are qualified, serve in a tem porary capacity higher than appointed for, they will be paid the higher rate during such service, and if they serve in a lower capac ity, they will be paid the rate applicable to the capacity appointed for. The com pany reserves the right to transfer any officer from one vessel to another with the understanding that the wage scale for the individual is protected. In the event that additional passenger or freight steamers are purchased or chartered b y the ------- Company, after the start of the navigation season, it is understood that the season of em ploym ent for officers on such vessels shall comm ence when the steamer or steamers are placed in service and continue until the vessel is laid up or returned to the owner. This provision shall not apply should charter provisions require that officers then aboard said vessel continue in the service of the ship for the balance of the year during which the charter or purchase is effected, other than they be mem bers of the association. In the event this paragraph shall apply, then it is understood that the rates of pay will not be less than provided for in Article IV hereof. I f the service of one or more vessels is discontinued at any time during the life of this agreement for one or more of the following reasons: 1. Marine disaster, total or constructive total loss, or marine disaster less than total or constructive total loss which nevertheless requires,,the vessel or vessels to be laid up for a considerable period on account of failure to get repair materials due to war priorities, or failure to get the ship into a repair yard b y reason of war conditions beyond control of the com pany; 2. Condemnation b y Bureau of Marine Inspection and N avigation; 3. Sale of vessel, commandeering or taking over b y Governm ental au thority; The com pany may discontinue the service of any or all of the officers covered b y this agreement after a period of seven (7) days after the discontinuation of such service, as specified, and for reasons as provided above. 2. P l a n s W it h o u t E l ig i b i l i t y W it h o u t P r o v is io n f o r M g a t io n of P l a n R e q u ir e m e n t o d if ic a t io n or an d A bro 104. T ex tile dy ein g an d finishing— M P (In d.) 18. (a) The com pany agrees to pay each journeyman printer and apprentice full pay (40 hours’ straight-time pay) for any period prior to July 15th during which the journeym an printer or apprentice is not em ployed. The com pany further agrees to pay each journeym an printer or apprentice one-half pay (20 hours’ straight-time pay) for any period after July 15 to Decem ber 3 1 ,-------during which the journeym an printer or apprentice is not em ployed. 105. T ex tile d y ein g and fin ish in g— M P (In d.) The com pany agrees that so long as it operates on a “ staggered shift” so-called, it will pay each printer or apprentice one-half pay for any 23 weeks during which, at any time throughout the terms o f this contract, each printer or apprentice is not em ployed. If the com pany is operating on a basis other than a “ staggered shift” so-called, it will pay each printer or apprentice one-half pay for any 20 weeks during which at any tim e through out the terms of the contract such printer or apprentice is not em ployed. The foregoing provision shall not apply, however, to a printer who is hired tem porarily to replace a regular printer who is absent b y reason of illness or who is on vacation. 106. T ex tile d y ein g an d fin ish in g— F S E S (In d.) During period of unem ploym ent members o f the so ciety em ployed b y em ployer shall be compensated at the rate of one-half their basic w eekly wages for a period of 12 weeks during the term of this agreement. 107. W o m e n ’ s coa t m a n u factu rin g— IL G (AFL) F ir s t . The em ployer hereby agrees, covenants, and guarantees that it will give to each of the persons now in its em ploy in the cutting, operating, finishing, and press ing departments and to each of the persons now in its em ploy as basters and buttonhole makers, fifty full weeks of em ploym ent during the term begin n in g-------and term i nating -------. The names o f the said em ployees are con tained on the list annexed hereto, made a part hereof, and marked schedule A. Each of the workers on the annexed schedule agrees to work for the em ployer for the term of this agreement and in accordance with the terms thereof. 108. S ilverw are m a n u factu rin g— E R M W (C IO ) E ig h t h . The em ployer guarantees that he shall em ploy the em ployees named in the schedule herewith attached and made part of this contract, for a period of forty-five (45) full weeks during the year o f ------- , and that the re maining six (6) weeks he will em ploy them on a part-tim e basis (three (3) days a ^ eek ), and that one week, namely, between Christmas and New Y ear’s, he shall have the right to close the factory for the purpose of taking inven tory. All weeks that have been worked prior to the signing of this agreement during this year shall be de ducted from the guarantee of forty-five (45) weeks, and all part-tim e workweeks that have been worked this year shall be deducted from the six (6) part-tim e weeks. All other employees who are not listed in the attached schedule, or those in the wrapping and assembling departm ents who have or will join the union at the expiration of the old agreement, shall not be covered by said guarantee. Any em ployee who is listed on the attached schedule but who is discharged for cause, shall be autom atically rem oved from APPENDIX B.---- CLAUSES IN GUARANTEE PLANS AND CONTRACTS the operation of said guarantee. A ny holiday listed in paragraph six which comes out during a working week, and in the event that the employees do not work on that day, that week shall nevertheless constitute a full working week for the purpose o f defining a full week in the above men tioned guarantee. 109. R eta il w o m e n ’ s a cce s s o rie s — F W (C IO ) * * * the union agrees to accept the same under standing that prevailed during t h e -------contract year— that is, a guarantee of forty-tw o (42) weeks of work for the fou r (4) finishers and tw o (2) operator-nailers who are em ployed at present in the fur department. 87 114. W in d o w an d d oor fra m e m a nu factu ring— N o u n ion In the event o f slack periods, the com pany will advance to its employees certain sums to be repaid with work when production increases. The plan is only effective in the case o f short hours caused by reduced production. For the purposes o f the plan, em ployees are divided into three different classes, as follows: (1) Single men with no dependents. (2) Single men or married men with one dependent. (3) Single men or married men with more than one dependent. F o u r t h , (a) Wages of salaried checkers under this agree ment shall be agreed upon between the com pany and said salaried checkers, but not less than tw o hundred and five dollars and tw enty cents ($205.20) per month. Six (6) salaried checkers shall be given one (1) day per week off and a guarantee of nine (9) m onths’ pay. If, during any pay period (one-half m onth), the incom e o f those in class 1 is not equivalent to 40 hours at the em ployee’s rate, he can draw the difference between 40 hours’ incom e and his actual earnings from our com pany. Those in class 2 are entitled to 50 hours and those in class 3 to 60 hours. Incom e is (a) wage drawn from our com pany, plus (b) pay for any other em ploym ent, plus (c) unem ploym ent insurance benefits. 111. W a te r transportation— M E (C IO ) 115. C h em ica l an d fertilizer m anu factu ring— C W (AFL) 110. W a ter transportation— IL A (AFL) R u l e 2. (a) The season of em ploym ent for chief engi neers will be nine (9) m onths; the season of em ploym ent for first assistant engineers will be nine (9) months; and the season of em ploym ent for second assistant engineers will be seven (7) months. The season of employm ent, to start as directed b y the management, is to be continuous and is to be com pleted within the calendar year. 112. W a ter transportation— M M P (AFL) A r t ic l e V. The season of em ploym ent for pursers in the ------- Division shall be for six (6) calendar months. The season o f em ploym ent for pursers in t h e -------Division shall be for eight (8) calendar months. The season of em ploym ent for the purser o f t h e ------- shall be for three (3) calendar months. The season of em ploym ent for assistant pursers on the ------- Division shall be four (4) months. The season of em ploym ent for assistant pursers on t h e -------Division shall be four (4) months. 113. W a ter transportation— M M P (A FL) A r t ic l e V . The season of em ploym ent for all masters shall be eight (8) calendar months. The season of em ploym ent for all first, second, and third officers shall be eight (8) months. V. Wage-Advance Plans In wage-advance plans the em ployer usually obligates himself to provide advances to loans o f wages during slack seasons, with repayment required o f the worker only if the em ployer thereafter furnishes sufficient em ploym ent to enable the advance to be repaid. The plans provide specific methods for repayment or working off the amount o f the indebtedness. V. W henever an eligible em ployee’s weekly wage from the com pany falls below 30 hours’ pay at his current classi fied rate, due to lack o f work, the com pany will advance to the eligible em ployee, upon his written request on a form provided b y the com pany, the difference between his actual gross earnings and the 30 hours’ pay, less earnings from other em ploym ent and less any unem ploym ent com pensation which the em ployee has received or to which he may be entitled. 116. A u tom ob ile m anu factu ring— U A W (C IO ) Income Security Plan: 1. D escription of Plan. A credit will be established for each eligible em ployee equiv alent to three hundred and sixty (360) hours’ pay at his latest earned hourly rate, less any advances paid to the em ployee under the 1939 and 1940 em ployee benefit plans, and not repaid or earned out. If, in any week while this plan is in operation, an eligible em ployee’s earnings from the corporation and/or other regular em ploym ent are less than 60 percent o f his standard weekly earnings, as here inafter defined, the corporation will advance at the option of the em ployee, the difference between his actual earnings from the corporation and/or other regular em ploym ent and 60 percent o f his standard weekly earnings, until he has exhausted the credit established in his behalf, less any unem ploym ent compensation to which the em ployee m ay be entitled for that week. Lay-off Benefit Plan: 2. Description o f Plan. A credit will be established for each eligible em ployee equiv alent to 72 hours’ pay at his latest earned hourly rate less any advances paid to the em ployee under the 1939 and 1940 em ployee benefit plans, and not repaid or earned out. If, in any week while this plan is in operation, an eligible em ployee’s weekly earnings from the corporation and/or other regular em ploym ent are less than 40 percent o f his standard weekly earnings, the corporation will GUARANTEED WAGE PLANS IN THE UNITED STATES 88 advance to such em ployee, at the option of the employee, the difference between his actual earnings from the corpo ration and/or other regular em ploym ent and 40 percent o f his standard weekly earnings, until he has exhausted the credit established in his behalf, less the am ount of unem ploym ent com pensation to which the em ployee m ay be entitled for that week. 117. some union-management agreements have recently incor porated one or more of the follow ing provisions: (1) Recognizing the im portance and desirability of stabilizing em ploym ent, (2) recognizing the value to be derived from a guarantee plan, (3) that it is the intention of the com pany to inaugurate a plan at some designated date, or (4) that the com pany or that both the com pany and the union agree to study the feasibility o f its adoption. M a il ord e r h o u s e an d retail stores— N o u nion Constant Wage Income Plan: 11. If an em ployee works less than 40 hours in any workweek, che com pany will advance the difference between his incom e for the hours actually worked and 40 hours’ pay. When an em ployee works more than 40 hours, excess is used to cover his deficit. Please refer to attached plan. The above plan applied to both retail and mail order establishments. T he plan in retail stores was termi nated ------- . The plan is still in effect in all [8 cities] mail order houses e x c e p t------- where none is needed. VI. Declaration of Intention to Inaugurate a Guarantee While n ot making a specific com m itm ent to furnish work or income, if work is n ot available for any definite period, 118. M e a t packing— U P W (C IO ) [Company] recognizes the im portance and desirability of stabilizing em ploym ent on an annual basis, and to that end [the com pany] will * * * attem pt to give em ployees 52 weeks’ work per year. 119. S te e l m ill— U S W (C IO ) The com pany and the union agree as to the mutual benefits to be derived from a practical annual wage plan and both parties m utually recognize the uncertainties which must be eliminated before a practical annual wage plan can be perfected and installed. Therefore, both parties agree to undertake studies concerned with the possible ultimate establishment of some form of guaranteed annual wage plan. Index to Appendix B C la u se ser ia l N o . In d u s tr y Autom obile m anufacturing.__________ Automobiles, retail____________________ Brewery_______________________________ Casket m anufacturing________________ Cem ent m anufacturing________________ C em etery______________________________ Cereal preparations___________________ Chemical and fertilizer manufacturing. Chewing gum m anufacturing_________ Cleaning and dyein g__________________ Clothing, retail____________ ____________ Confectionery, retail__________________ D airy fa rm ____________________________ Dental supplies, retail_________________ Departm ent store_____________________ D istillery______________________________ Drugs, retail__________________________ D ry goods, retail______________________ D ry goods, wholesale__________________ E lectroplating_________________________ Flour m ill____________________ _________ F ood canning and preserving_________ Food, retail and wholesale____________ Fur designing and patternm aking_____ Furs, retail____________________________ Furs, wholesale________________________ Groceries, wholesale___________________ Hardware, wholesale__________________ Ice and coal, retail____________________ Jewelry m anufacturing________________ K nitting machinery production_______ K nitting m ill__________________________ Limited price variety store_______ ____ Liquor, retail__________________________ Lumber, retail_________________________ Mail order house______________________ M ail order house and retail stores____ M eat packing_________________________ M en’s clothing, retail_________________ News syn dicate_______________________ Newspaper publishing________________ Paint and varnish m anufacturing_____ Painting and decorating______________ Paper m anufacturing_________________ Public u tility__________________________ Radio broadcasting___________________ Radios, retail__________________________ Railroad repair and m aintenance_____ R efrigerator car servicing_____________ Restaurant____________________________ R ubber goods m anufacturing_________ Sausage casing m anufacturing________ Shipyard______________________________ __ 23, __ __ 31, __ 116 71 47 48 70 42, 99 4 4 ,4 5 115 46 72, 92 30 10,38 32 90 11 15 30 __ 20, 39 65, 66, 74 82 ___________ 1 ,2 ,2 5 ,7 9 ________________ 53 ________________ 19 ________________ 62 ______ 41, 58, 59, 61, 87 ________________ 9, 28 ________________ 27 ________________ 8, 37 ________________ 89 ________________ 26 ________________ 52 ________________ 73 __________________ 56,96 ________________ 88 ________________ 30 ________________ 12 ________________ 117 ____________ 34, 35, 118 21, 29, 40, 60, 75, 84, 85 ________________ 93 ________________ 68 ________________ 17 ________________ 33 ________________ 16,50 _________ 1 3 ,2 4 ,6 7 ,7 8 ________________ 95 ________________ 30 ________________ 76 ________________ 77 ________________ 98 ________________ 54 ________________ 43 ________________ 55 89 90 GUARANTEED WAGE PLANS IN THE UNITED STATES In d u s tr y Shoe m anufacturing____________________ Shoes, retail____________________________ Silverware m anufacturing______________ Soap m anufacturing____________________ Social service agency___________________ Steel m ill_______________________________ Syrup distribution, wholesale__________ Textile dyeing and finishing____________ Textile m ill_____________________________ Textiles, w h olesale_____________________ T ool and casting m anufacturing_______ T ool and wire m anufacturing__________ Washing machine production__________ W ater transportation___________________ W indow and door frame manufacturing W om en’s accessories, retail____________ W om en’s coat m anufacturing__________ W om en’s clothing m anufacturing______ W om en’s clothing, retail________________ C la u se se r ia l N o . __________________________________ 69 22, 86 ___________________________________________________ ___________________________ 108 ___________________________ 5, 81 __________________________________ 14 _________________________ 18, 119 __________________________________ 83 3, 4, 36, 80, 101, 102, 104, 105, 106 __________________________________ 63 __________________________________ 64 ___________________________ 6 __________________________________ 51 _____________________________________7 91, 94, 100, 103, 110, 111, 112, 113 __________________________________ 114 ___________________________________ 109 .1________________________ 107 ___________________________________ 49 _____________________________ 57,97 U. S. GOVERNMENT PRINTING OFFICE: 1948