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LABOR RELATIONS IN THE IRON AND STEEL INDUSTRY, 1936 TO 1939

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u n p u b l i s h e d T h e s e s s u b s i v c s d f o r the D o c t o r s d - = r - e
P r i n c e t o n U n i v e r s i t y and d e p o s i t e d in the U n i v S r s i t v L i b r a r y
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R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
LABOR RELATIONS -IN THE IRON AND STEEL INDUSTRY, 1936 to 1939
A DISSERTATION
Presented to the
Faculty of Princeton University
. in Candidacy for the Degree
of.Doctor of Philosophy
toy
Frederick H. Harbison
Princeton
1940
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Recommended h y the Department of Economics and Social Institut
for Acceptance
April, 1940
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
PREFACE
In attempting to analyze the impact of unionization on
the iron and steel industry.during the past four years, the im­
partial observer is beset with many difficulties.
The recent
course of labor relations in steel is not recorded in documents.
Union contracts, statements in the daily press and recorded
hearings conducted by governmental bodies give very little in­
dication of the actual development of union-management relations
in this traditionally "open-shop" industry.
Consequently,
the
writer has been dependent for material in large measure on associ­
ation and personal interviews with employers, employees and union
leaders who are taking active part in the development of labor
relations.
Amidst a maze of alleged facts, assertions and specu­
lations which are colored in many cases by personal opinions,
the impartial student must chart as best he can that course which
appears to approximate factual certainty.
The task is made more
difficult by the rapid pace of events which may cause the picture
to change In many respects several times during the period of
writing.
The purpose of this study is to examine the course of
labor relations In the steel industry from the opening of the CIO
unionization campaign in 1936 to the end of the year 1939. The first
objective is to describe the structure and analyze the effective­
ness of a type of labor organization which is relatively new in
the American labor movement, namely the "organizing committee."
V/ j'U
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Strictly speaking the CIO "union" in steel has been as yet
neither led nor controlled by steel workers.
It is essential­
ly an organization sponsored by the United I,line V/orkers and
the CIO, whose purpose it is to lay the foundation for an in­
dustrial union in the steel industry*
The second objective is
to trace the effect of unionization, and the threat of further
unionization, on the development of industrial relations poli­
cies and programs in the large steel corporations that dominate
the industry.
The final objective is to analyze the type of
union-management relationships that have grown out of this en­
vironment .
By the end of 1339 labor relations in the steel indus­
try had not yet resulted In wholehearted acceptance of the prin
ciples of collective bargaining by most employers.
In fact,
the reader will readily notice that this study has been pre­
occupied, necessarily, with a description of the struggle to
establish collective bargaining relationships ratner than with
an analysis of procedures of collective bargaining, which at
the time of writing were still in the early stages of evolution
A large portion of the material in this dissertation wil
be published in a forthcoming study of collective bargaining
which is being undertaken by the Twentieth Century Fund.
The
writer is under obligation to the Twentieth Century Fund, as
well as to the Industrial Relations Section of Princeton Uni­
versity, for the opportunity to do the large amount of field
work required in a study of this kind.
The main obligation,
however, is to the 250 representatives of industry and labor
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Hi
who so willingly cooperated in giving the writer a close-up
view of current developments.
To two men in particular, with­
out whose constant help and sympathy for the problems of the
"academician" this study could never have been completed,
the writer ov/es a special debt of gratitude:
Clinton S. Golden,
Northeastern Regional Director of the Steel V/orkers OrganizingCommittee and John A. Stephens, Director of Industrial Relations
of the United States Steel Corporation of Delaware.
Last but
not least the writer wishes to express appreciation to Professor
David A. McCabe of Princeton University for continued interest
and helpful comments during the course of preparation of the
manuscript.
Frederick II. Harbison
March 15, 1940
I
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TABLE OF CONTENTS
Preface
Chapter
J. •
T jIE
steel
i n d u s t r y
........... ...............
A. The Production of Steel
...............
B. The Marketing of Steel . . . . . . . . .
0. Recent Technological Changes and Improved
Production Methods ................. .
D. Wages, Employment and E a r n i n g s .........
II •
DEVEnOPiviEHT S PAI u a TO TEE SNOG DRIVE
III.
ORGANIZING TACTICS AND STRATEGY OF THE SWOC .
A. Early Organizing Strategy
.............
B. The "Capture" of the Carnegie-Illinois
Employee Representation Plans
. . . .
C. The United States Steel Agreement of 1937
IV.
13
14
24
28
28
31
49
SWOC Victories-M arch to May, 1937
........... 53
"Little Steel"....................................54^
Recession and R e v i v a l ........................... 57"
THE SWOC AND GOVERNMENT
A.
B.
G.
VI,
6
8
ORGANIZING TACTICS AND STRATEGY OF THE SWOC (con­
tinued)
........................................... 53
D.
E.
F.
V.
.2
4-
. . . .
A. The Amalgamated Association of Iron, Steel
and Tin Workers
......................
B. The Development of Employee Representation
Plans
. . .
........................
C. The United Mine '.Yorkers and the Steel
Campaign ..............................
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1
67
The National Labor Relations A c t ................. 67
The Walsh-Healey Act
................ 75
Legislative and Political Activities of the
SY/CC..................................
79
STRUCTURE AND AlmS 01' THE S W O C ....................... 84
■A.
B.
C.
D.
The International Organization
..............
84
The Lodges
.
..................................93
Objectives of the SWOC
................
99
The Strength of the S W O C ......................103
xv
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V
VII.
Page
POLICIES a TID ORGANIZATION uf THE STEAL CGRPORATIQPS. . 106
A. Development of Collective Bargaining Policies. .. BL06
B. Management O r g a n i s a t i o n ...........................112
VIII.
THE MAKING 0P: A G R E E M E N T S ............................... 117
A.
B.
C.
D.
s
IX.
UNION R E G O C H I T I O H ...........
A.
B.
C.
D.
E.
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XI.
I
:S
s
g
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Recognition for Members O n l y ....................
Recognition as Exclusive Bargaining agency
. .
Complete Recognition
..........................
Collection of Dues.................................
Ilnion-Hanagement C o o p e r a t i o n ....................
W A G E S ................................................
129
129
151
153
135
138
140
A. Wage Rate Structure In theSteel Industry . . .
140
B. The General Level of W a g e s .......................144
C. Adjustment of Individual and Group Rates
...
148
1. I n e q u a l i t i e s .................................. 148
2. Changes in methods . . . . .
..............
149
H
1A
negotiation of the 1937 C o n t r a c t s ................117
Extention of Contracts in 1938
. . . . . . . .
117
The PollC;/ of E n c i r c l e m e n t ...................... 125
The Significance of the Steel Contracts . . . .
127
XII.
|f
WORK-SHARING AND SENIORITY ..........................
155
A. Work-sharing........................................ 155
B.Seniority and Competency inPromotion and
Increase or Decrease' of forces
.............
157
C. Calculation and Application of Seniority
Rights............................................ 163
"
MISCELLANEOUS CONTRACT PROVISIONS
..................
168
A.
Hours
................................ 168
B.
Safety and H e a l t h ..............
170
C. Vacations and H o l i d a y s ..........
171
D. Management Rights . . . . . .
............... . 172
E. The Status of F o r e m e n ............................. 175
m
XIII.
THE;ADJUSTMENT OF G I R E V A N C E S ........................... 175
A. Procedures Set Forth in the Standard Contract .
B. Examples of Operation of Grievance Machinery. .
C. General Comments on Adjustment of Grievances. .
I
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175
180
1S3
V i
Page
xiv.
l a b o r r e l a t i o n s u i t h u h a f i i l i a t e d grg -^r i z a i i u k b .
. . 200
A. Structure of Unaffiliated Organizations . . . . 200
B. Strength, and Weakness of Unaffiliated
Organizations ................................. 205
C. Relations with M a n a g e m e n t .........................208
XV.COHCLUSIOI'f .
.....................................
A p p e n d i c e s ................................
Sources of Material
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213
225
I.
THE STEEL INDUSTRY
Steel is the veritable keystone of American industry.
Giving employment to nearly 500,000 persons and paying divi­
dends to as many stockholders, steel is the largest manufac­
turing industry in the country.
One out of every four people
in the United States lives in a community where a steel mill
is located, and is, therefore, affected in some way Gy the
condition of the steel companies.
Indirectly, developments
in steel have a far-reaching influence on a great variety of '
allied fabricating and processing industries for which steel
is the principal raw material.
The basic iron and steel in­
dustry mig£it be characterized, therefore, as an economic ba­
rometer for many other groups of American employers.^
Made notorious by Its critics in years past for exploit­
ing Jiabor under back-breaking and hazardous working conditions,
for amassing exorbitant profits, and for ruthless suppression
of union organization,
the steel industry has, of late, under­
gone considerable change.
Today wages are high; modern m a ­
chinery has to a large extent eliminated heavy labor; earnings
The term "iron and steel industry" as used in this study in­
cludes a l l .companies, no matter what their finished product,
which by reason of Integrated operations produce their own
steel or iron as a raw material for further processing.
Nearly
all such companies are members of the American Iron and Steel
Institute.
,(cf. Daugherty, De Chazeau and Stratton, Economics
of the Iron and Steel Industry. New York, 1937, Vol. I, pages
9-10.)
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
have been disappointing; and collective bargaining with out­
'Vi
side unions has attained a foothold.
Nor is steel an industry of foreigners as it was char­
acterized in the heyday of immigration.
those who work in steel mills were b o m
Today 70 per cent of
in the United States
and about 90 per cent are American citizens.
Of the total
working force, which consists almost entirely of males, fewer
s
than 10 per cent are classed as "unskilled," while a very small
proportion are considered "highly skilled".
at least high school education.
Nearly half have
Like other groups of better-
paid American workmen, many of them drive to work in automobiles,
enjoy baseball, bowling and golf, and use their one-week annual
vacation to go hunting or fishing.
The preponderant majority of
steel v/orkers can be described as capitalist minded, non-revolu­
tionary, and job-conscious.
W:
■i"
A.
The Production of Steel.
A few large companies are predominant in the American iron
and steel industry.
The three largest corporations, United, States
Steel, Bethlehem, and Republic, possess over one-half of the in­
dustry’s steel ingot capacity, while the ten largest steel pro­
II
;S
ducing companies account for over 80 per cent of the nation’s
1
ingot capacity.
Nevertheless, there are over 200 small concerns
■^Calculated from data published in: American Iron and Steel In­
stitute, Directory of the Iron and Steel ¥/orks of the United
States and Canada" New York. 19581.
tit
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
which compete with the large integrated companies in the sale
of finished products, and, at the same time, are dependent on
them for raw materials.'*'
Geographically the industry is concentrated in a few
steel-producing centres, easily accessible to both coal and
iron ore:
Bethlehem, Pittsburgh, and Johnstown, Pennsylvania;
Sparrows Point, Maryland; Wheeling and Weirton, ’
W est Virginia;
Youngstown, Warren, Cleveland,
Canton, and Middletown, Ohio;
Gary, Indiana; Chicago, Illinois; Buffalo, New York; and Birming­
ham, Alabama.I
The larger corporations usually have plants in
several of these districts, while the small concerns are gener-
v ■■ i.
ally confined to one locality.
Since the competitive position
of the various localities may be seriously affected by changes
in the system of quoting prices, or by alteration of established
3
wage differentials, the smaller companies are at the mercy of
those corporations which have widely distributed plants.
1
g
­
1
Steel requires a very large capital investment, resulting
in high overhead costs and rigidity of capacity.
The total in­
vestment in the industry at the end of 1938 was over four billion
dollars, amounting to approximately $10,000 per employed worker.
Blast furnaces, open hearths, and rolling mills represent hugh
investments in large-scale units of equipment.
A new continuous
rolling mill, for example, costs approximately fifteen million
dollars.^
The magnitude of individual units, consequently,
1
Daugherty, De Chazeau and Stratton, Op. cit., Vol. I, page 27.
Steel Facts. May, 1939.
Institute.)
5Ibid.
(Published by American Iron and Steel
I
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makes it impossible to increase steel making capacity by small
increments or to transfer it from one locality to another.
Hence the competitive position of the companies may be dependent
i
not only on production and marketing costs but also on the type
of equipment they possess, and the ability to forecast changes
in demand that may require new equipment.^B.
The Marketing of Steel.
Steel is predominantly a raw material for various metal
fabricating and processing industries.
Most of the consuming
industries are concentrated near the steel production centres.
The purchase of steel, furthermore,
is concentrated in a few
large industrial groups, and even more significantly, in a
small number of companies within these groups.
It was esti=
mated that in 1934 at least 42 per cent of the total tonnage
g
sold was shipped directly to less than 100 companies.
Most
steel, consequently, is marketed by the sales organization of
the producer and shipped directly from the mill to the buyer’s
premises.
The function of the jobber is limited to "fill-inu
orders for immediate delivery or the serving of small fabricators.
Throughout the years,
|
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|,,j
jjrv
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the over-ail demand for products
of the steel industry has shown a long-term upward trend, and
with the development of new uses for steel products this condition is likely to continue. At the same time, the demand for
^
Daugherty, De Chazeau and Stratton, O p . c i t .. Vol. I, pages 522Ibid.. Vol. I, page 51.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
%
steel has been shifting away from the so-called heavy products
(rails, structural shapes, heavy plates, etc.) to the lighter
products
steels).
(strip, sheets, tin plate, wire, and various alloy
This shift has been occasioned by the growing demand
for automobiles, cans for foods, refrigerators, washing machines,
and other consumers1 goods, which together account for the use
of approximately 65 per cent of such light products.
Since the
lighter steels are in general more highly finished, this shift
in demand has required more labor.
On the other hand, recent
technological improvements in the manufacture of sheets and tin
plate have resulted in very substantial savings in the amount of
labor required.
Steel products, with few exceptions are sold on the basing-point system of delivered prices.
Although, even under the
"Pittsburgh-Plus" system* there never existed air-tight price
I
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\
control, the traditional objective has been to minimize so-called
"cutthroat" price competition.
Price stabilization,
as attained
through price control, was probably more nearly reached during
the N.R.A. Code.period than at any other time in the history of
the industry.**-
Since that time the existence of a buyers' mar­
ket and the disappearance of the Code Authority have induced
keener competition in the field of prices.
r
I,
sit
Steel producers have
pointed out that, although the published composite price index
*
of all steel products shows very little variation, the realized
—
f,-
"^Daugherty, De Chazeau and Stratton, Op. cit.. Vol. II, pages
1079-1080.
n
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
prices for individual products have fluctuated widely in accord
with supply and demand.^"
Nevertheless, a number of factors preclude a simple com­
petitive price for steel.
feU
i
The small number of producers, the
magnitude of overhead costs, the immobility of the sources of
raw materials, and the relative inelasticity in the demand for
many steel products gravitate toward a discriminatory pricing
2
system*
An increase in the cost of labor and materials is apt
to be passed on to the consumer as the dominant producers in
*
the steel industry seem to have a strong inclination to price
steel, in so far as possible, on a cost-plus basis.
It is im­
portant to note, however, that competition is very keen in
matters of delivery, quality, and the handling of special orders*
C.
Recent Technological Changes and Improved Production Methods.
In the five-year period 1935 through 1939 the steel Indus-
■
t
r
try spent over one billion dollars for new equipment and construe
■i ;
tion.
Plants rendered obsolete or Inefficient by improved tech­
nology were abandoned or scrapped and replaced by construction of
new plants or by modernization of existing facilities*^
The most
striking technological development has been the building of 28
;If
!'
90k
new continuous rolling mills, in response to the increased demand
^
■ *’
^Interview. Kemp Puller, Head, Marketing Research Division,
U.S. Steel Corporation of Delaware*
o
Daugherty, De Chazeau and Stratton. Op. cit., Vol. II, page 1101
5
Steel P a cts. February, 1939*
S§
\
!i
I
for light products, which have revolutionized the making of flat-
■- i■ 7
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rolled steel.
As a corollary to this development, the more
exacting requirements of the continuous mills have in turn
necessitated important improvements in the open hearth and
slabbing operations.
In addition to a tremendous saving in -
labor costs, these new continuous mills produce steel of finer
surfaces and deeper drawing qualities than were heretofore pos­
sible.
Consequently the production of flat-rolled steel under
the old process is being rapidly curtailed.
Since only the
largest companies can afford to install these new mills, the
small producers of sheets and tin plate are being forced out"
of business.
The development of continuous mills, therefore,
together with the elimination of basing-point price differ­
entials, has worked to the advantage of the larger companies
at the expense of the smaller, and, consequently, the problem
of displaced labor will be most acute in the small companies.
Another noteworthy development in recent years has been
the more efficient use of labor brought about by the newly
created industrial engineering departments.
With the aid of
time studies and job evaluation, a beginning has been made In
the scientific use and management of labor.
The increasing
use of Incentive rates has tended to speed up production to a
considerable degree, and the relentless search for better pro­
duction methods has greatly increased the efficiency of the
working forces as a whole.
Counterbalancing to some degree the savings created by
elimination of jobs through technological improvements and more
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
efficient handling of the labor force, there have been other
factors which have operated to increase costs.
The number of
man-hours per ton on some products has risen in the past ten
years because of the need for employing persons to safeguard
the quality of the product.
With the increased demand for high-
quality steels, the companies are confronted with the problem
of making each heat of steel to a closer limit of tolerance in
chemistry, size and other properties.
Moreover, buyers have
become accustomed to purchase steel on a "hand-to-mouth1* basis.
The recent predominance of small orders, together with the lack
of proper standardization of many products, has to some extent
limited the much publicized economies of mass production methods.1
D.
Wages. Employment, and Earnings
Wages of plant workers amount to about 30 per cent of the
steel sales dollar.^
The trend of wage rates has been upward,
the most marked increases having taken place in the last few
yeai’s.
In June, 1933, common labor (minimum) rates were about
30 cents per hour and average earnings of plant workers were 47
cents per hour.
Increases under the Code raised these rates to
approximately 37 cents and 57 cents respectively, while a further
3
increase in 1934, due to activity of employee representatives,
For further elucidation of this theory, see: Lose, James E.,
"Problems in Manufacture and Use of Steel Products in the United
States," Yearbook of the American Iron and Steel Institute,
New York, 1939.
O
Total payrolls amount to between 35 and 40 per cent of the sales
dollar, as reported by Steel Pacts, June, 1938, and June, 1939.
The figures presented in the text exclude salaried employees.
g
cf. page 18.
IS
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brought them to 43 cents and 64 cents.
Since the opening of the
SWOC campaign, two additional increases have been granted, bring­
ing common labor rates to 58 cents per hour and average earnings
1
of plant workers to about 83 cents per hour.
These latter are
the highest in the history of the industry, and are 27 per cent
above the average hourly wages in all manufacturing industries.
Geographically, there are differentials between various districts,
the most pronounced being the North-South differential of close
to 30 per cent in common labor rates.
Within the several dis­
tricts, however, there seems to be a high degree of uniformity
as between different plants in common labor rates.
General
changes in wages have usually been announced simultaneously by
all members of the industry.
The expanding demand for steel products together with the
shortening of working hours has resulted in an upward trend of
employment in the steel industry.
The peak was reached in 1937
when the industry employed close to 500,000 wage earners.
As a
result of technological and organizational improvements, however,
it is quite likely that this upward trend of employment has been
reversed.
Yet as steel is an industry of expanding output and
high wage rates, it is at the same time noted for great cyclical
and seasonal fluctuations of production, resulting in insecurity
of employment and uncertain earnings for its employees.
From
1929 to 1931 employment dropped about 33 per cent, and from the
■^These figures were calculated from data supplied to the writer
by the American Iron and Steel Institute.
ta
^Steel Facts. November, 1938.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
peak of operations in 1937 to the low point of 1958 approximately
fe
r
32 per cent.
For the same period, 1937-1938, payrolls declined
■
—
more than 50 per cent, thus indicating that steel workers* in­
come suffered not only from curtailed employment but from shorter
hours as well.'*'
Contrary to popular belief, profits in the steel industry
|
t
during the past two decades have not been large.
From 1919-1928
-
the average return on investment in the industry was 5.1 per cent.
From 1929-x938 it was only 2.4 per cent.
^
2
The net income of 28
principal 3teel companies in 1937, the peak year of employment
and payrolls, was 44 per cent below that of 1929.^
The low and
unstable rate of profits in recent years reflects the wide fluc­
tuation of production, the increased labor costs and taxes, and
the increasing instability of prices.
It has been estimated,
for example^ that, following price reductions and elimination of
basing-point differentials during 1938, the "break-even” point
of profitable operations for the most efficiently managed com­
panies has been raised from about 40 per cent to approximately
50 per cent of capacity.4
In the background of the development of collective bar­
gaining in the iron and steel industry, five factors stand out.
First, steel is still an expanding industry.
The increasing
demand for steel products, particularly in the consumers* goods
11
H
K
§
P|
^
y
n
Calculated from data supplied b y the American Iron and Steel
Institute.
2Steel
Facts, various issues.
>z
_National Industrial Conference Board, Quarterly Review of the
iron and Steel Industry. Ho. 8, March, 1939, page 8.
4ibid.
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line, has attracted and will probably continue to attract capital
to the industry.
Second, steel is a high-wage industry.
Not
only is the productivity per worker high because of large capital
investment per employee, but also it has been possible to pass
on labor costs to the consumer under conditions of relative in­
elasticity of demand for steel as a raw material.
Third, employ­
ment and earnings of steel workers have been notably unstable.
7/ith the permanent displacement of certain groups of employees
resulting from, the introduction of labor-saving devices, thiscondition has become aggravated in recent years.
is not a highly profitable industry.
Fourth, steel
Increased labor costs,
fluctuations of operations, higher taxes, and recent price in­
stability have made profits as uncertain as employment.
Finally,
steel is dominated by a few large corporations which not only
produce the great bulk of the nation’s finished steel products
but also supply their smaller competitors with raw material.
The study of collective bargaining, therefore, hinges primarily
upon the developments in these large corporations.
Since the turn of the century, steeu has been famous as
an impregnable stronghold of the open shop.
The unexpected an­
nouncement in March, 1937, that the United States Steel Corpora­
tion had, without a struggle, entered into contractual relations
with a CIO affiliate came as a complete surprise not only to the
public, but also to organized labor and the large majority of
steel makers themselves.
Had the traditional anti-union policy
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12.
been abandoned?
Was the steel industry to engage in collective
bargaining with outside labor organizations?
To answer these questions it is necessary to trace the
development of labor policies in the industry, the origin and
growth of the Steel 'Workers Organizing Committee, the back­
ground of the famous "Taylor-Lewis" agreement, and the nature
of relations with both the SWOC and various unaffiliated organ­
izations that have emerged as bargaining agents for steel v/orkers
since 1937.
This study is concerned primarily with the impact of union­
ization on an open shop industry.
In the period from 1933 to
1939, changes in management outlook and the struggle of organized
labor for recognition overshadow the techniques and procedures
of collective bargaining which by 1939 were as yet only in the
early stages of development*
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
XI.
DEVELOPMENTS PRIOR -TO THE SWOC DRIVE
A . The Amalgamated Association of Iron. Steel and Tin Workers*
The present status of labor relations In the basic iron
and steel industry goes far beyond any achievements of the old
Amalgamated Association of Iron, Steel and Tin Workers, and has
little of its origin in the efforts of that organization.
Be­
ginning with a decisive blow at the hands of the Carnegie Steel
Company in the Homestead strike of 1892 the history of the Amal­
gamated since that time had been one of defeat after defeat.
The failure of a general strike against the United States Steel
Corporation in 1901 was followed shortly afterwards not only by
the elimination of the union from the U.S. Steel mills but also
from most of the plants of the large independent steel companies.
Although an organization campaign In 1918 and 1919 enrolled over
250,000 union members, the Industry-Y7lde strike of 1919 was a
dismal failure.
Prom 1920 to 1953 the Amalgamated never repre­
sented as many as 10 per cent of the nation’s steel workers.
What little strength the Amalgamated ever had was concentrated
among craftsmen in small bar, sheet and tin mills which were
rapidly becoming obsolete as a result of the quickened page of
fl
X
technological advance in the industry.
Furthermore, the Amalgamated failed to conduct a success­
ful organizing campaign during the period of the National Industrial Recovery Act.
Either the International officers were not
alive to the opportunities provided by the Recovery Act, or they
p
felt that their resources were too limited to challenge the power
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
of the steel companies, which had set up employee representation
plans to stave off unionization.
Most of the organizers sent
into the field were lacking in attractiveness, force, and experi­
ence.
Moreover, the international officers refused to sanction
an effort to capture the employee representation plans in the
larger plants, and urged all members to boycott them completely.
To add to its weakness, the Amalgamated in 1934 and 1935 was
split by internal dissension and factionalism.
For a while it
looked as if the insurgent rank-and-file group might make some
progress.
This movement, though spectacular for a few months,
1
ended in failure.
It is quite reasonable to conclude that the Amalgamated
Association of Iron, Steel and Tin V/orkers, with its craft out­
look and outmoded constitution, its uninspired leadership and
itshistory of accumulated defeats has not been an important
factor in labor relations in the steel industry at any time
since the turn of the century.
The recent growth of unioniza­
tion springs from other roots.
B«
The Development of Employee Representation Plans.
The Importance of the development of employee representa­
tion plans as predecessors to collective bargaining with outside
unions is twofold.
First, the representation plans necessitated
a* complete and almost revolutionary change in the attitude of
management on industrial relations.
Second, while to some ex-
-
tent staving off the inroads of Independent labor organizations,
For detailed analysis of the Amalgamated during the Code period
see: Daugherty, De Chazeau and Stratton, The Economics of the
Iron and Steel Industry. Vol. II, Chapter XIX.
.tr'
■
&
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
the representation plans ultimately made the employees more con­
scious of the advantages of collective bargaining and afforded'^
valuable training for many future labor union leaders,
A few companies, notably American Rolling Mill and
Bethlehem, had set up employee representation plans long before
the advent of the N.I.R.A.
These plans had worked well in some
respects as a substitution for the personal relationship that
had existed between employer and employee when the enterprises
were small.
In short the employee representation plans pro­
vided a means whereby employees were encouraged to elect, from
among their number, representatives to deal with management.
They provided an orderly means of settling grievances and set
up a two way channel of communication between management and
men.
They were initiated, financed, and greatly influenced by
management. Employee representation plans, derisively referred
Vv
to as company unions, were in no sense labor organizations; em­
ployees were not members; they paid no dues.
The plans provided
a right of appeal on grievances beyond the foreman or department
superintendent to the higher ranks of management.
Lacking the
bargaining power of organized groups of workers, however, they
were not autonomous agencies for collective bargaining on major
issues of wages, hours and working conditions.
Most of the large companies, however, neglected to set
up representation plans until they were forced by the National
Industrial Recovery Act to recognize representatives of their
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
employees for purposes of collective bargaining.
They hastily'
introduced the plans in 1933 as ready-made formulae for com­
pliance with the law and as bulwarks against inroads of outside
labor unions.
Company officials took pains to state their pref­
erence for "collective co-operation" as exemplified by employee
representation rather than collective bargaining with outside
organizers.
Employee representation was generally hailed by
the employers as the twentieth century method of resolving intr
dustrial conflict into harmony and mutual co-operation.
In an
industry which had a reputation for combatting unions with com­
pany police, spies, and discharge of union sympathizers or
"agitators," management sponsorship and endorsement of company
,
;
:
h
unions was more than sufficient to induce the majority of steel
workers to support the plans in the annual elections.
In this
respect, a statement of Mr. W.A. Irvin, President of the United
States Steel Corporation, shortely after announcement of the
SWOC drive is typical:
"We are convinced that the vast majority
of you resent the idea of paying tribute for the
right to work. We, therefore, stand squarely on
the principle of the open shop . . .
It [the
plan of employee representation] is the fairest
method of collective bargaining that the employees and the management have been able to devise."
V
''
-v
l
-
Coupled with the feeling that "the company expects you to
boost the ERP^" was the contempt of steel workers for the Amal­
: v :'
-ii
gamated, which had possessed neither leadership nor financial
i-s
s§
U.S. Steel E e w s . July, 1936, page 1.
I
hi
; Tv.
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17,
h
I
h
h
resources to undertake a successful unionization drive.
Until
the advent of the SWOC, therefore, even the more aggressive
steel workers saw no promising alternative to the company union
machinery of group relations.
Gratified by the large majority of employees who voted
for representatives under the plan, steel executives were be —
ginning to feel secure in what they liked to think of as a
. ■■
united front of loyal employees against outside unions.
was this belief without foundation in many cases.
Nor
Employee
representatives in many plants, where management had demon'
strated a spirit of genuine interest, patience, and fair-play
in dealings with them, apparently lent their support to the
h
h
s
plans.
The representation plans were effective in bringing to
the attention of top management thousands of grievances.
Prom
38
1934 to 1936, 56,709 questions were settled under the plans,
of which 70 per cent were decided in favor of the employees.
j
hi
1
Most of the management executives interviewed indicated that
numerically the great majority of such cases involved minor
h3:
grievances which could be adjusted immediately upon being called
to management*s attention.
Also, most corporation officials
8s
interviewed agreed that during this period the companies were
very liberal:in granting small individual and group wage in­
8::
creases.
As one executive put it:
"We seldom refused such
3
The statistics on employee representation questions were sup­
plied by the American Iron and Steel Institute upon request of
the writer.
r3
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
.
■
requests; we usually made some slight concession wherever pos­
sible.”
Finally, many hazardous working conditions were brought
to light which management was glad to remedy, in order to im­
prove the plant safety record.
Some of the accomplishments of the period of the employee
representation plans were quite substantial.
by foremen were checked to some degree.
Arbitrary actions
One employee gleefully
stated that the foreman of his department had not knocked down
a single worker since the plans were introducedI
The wage cuts
of 1931 and 1932 were restored by two increases granted by the
major companies in 1933 and 1934*^
Vacations with pay for wage
earners were introduced in 1935 by the Inland and Youngstown
Sheet and Tube Companies, and granted the next year by the other
V'K
large corporations.
I
Yet, long before the SWOC started to organize the indus­
■■'.2
I•2"
try, weaknesses were apparent in some of the plans, particularly
those in plants of the far-flung Camegie-Illinois Steel Corporation and the American Sheet and Tin Plate Company.
To be suc­
B
cessful, an employee representation plan, as a management
i
1The
1933 raise was granted in anticipation of the increases that
would be required under the code. The 1934 increases originated
with a request by employee representatives of the Weirton Steel.
Company. At that time this company was counting heavily on the
support of the representatives in its defense against legal pro­
ceedings brolight by the United States Government, charging the
company with defiance of the National Labor Board. The company,
whose operating rate during the depression had been quite satis­
factory, was willing to grant a 10 per cent Increase. The whole
industry was forced to follow suit.
2
The American Sheet and Tin Plate Company was merged with the
Carnegie-Illinois Steel Corporation in the spring of 1936.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
requests; we usually made some slight concession wherever pos­
sible."
Finally, many hazardous working conditions were brought
to light which management was glad to remedy, in order to im­
prove the plant safety record.
Some of the accomplishments of the period of the employee
representation plans were quite substantial.
by foremen were checked to some degree.
Arbitrary actions
One employee gleefully
stated that the foreman of his department had not knocked down
a single worker since the plans were introducedi
The wage cuts
”
of 1931 and 1932 were restored by two increases granted by the...
1
major companies in 1933 and 1934.
Vacations with pay for wage
H
I
earners were introduced in 1935 by the Inland and Youngstown
Sheet and Tube Companies, and granted the next year by the other
large corporations.
Yet, long before the SWOC started to organize the indus­
I
try, weaknesses were apparent in some of the plans, particularly
those in plants of the far-flung Camegie-Illinois Steel Corporatxon and the American Sheet and Tin Plate Company.
p
To be suc­
cessful, an employee representation plan, as a management
The 1933 raise was granted in anticipation of the increases that
would be required under the code. The 1934 Increases originated
with a request by employee representatives of the Weirton Steel
Company. At that time this company was counting heavily on the
support of the representatives in its defense against legal pro­
ceedings brought by the United States Government, charging the ~
company with defiance of the National Labor Board. The company,
whose operating rate during the depression had been quite satis­
factory, was willing to grant a 10 per cent increase. The whole
industry was forced to follow suit.
2
The American Sheet and Tin Plate Company was merged with the
Carnegie-Illinois Steel Corporation in the spring of 1936.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
technique of group relations, must have wholehearted support
of the company from the top executives dovm the line to the
foremen.
But there were many foremen in the industry who
thought that the appeal procedure of the plans infringed upon
their former status and authority.
Top executives of some
corporations were skeptical of the plans from the outset.
If
the employee representatives were active, plant managers, super­
intendents and foremen were compelled to devote valuable time in
joint meetings discussing all sorts of requests and grievances.
Collective co-operation as contemplated by employee representa'tion calls for endless patience and painstaking education, es­
pecially if the representatives are inexperienced or unusually
aggressive.
Yet, many superintendents and foremen simply could
not readjust themselves to this new technique of group relations.
Top management, moreover, in making a determined effort to get
the workers to support the plans, often neglected to explain
the idea to the foremen and supervisors.
In some respects, the
plans lowered the morale of management rank-and-file.
Many
foremen never heard of grievances in their departments until
they were presented by the employee representatives to the
£
u
h
general superintendent.
This "short-circuiting" of the foremen
caused a great deal of resentment.
A fundamental weakness of the employee representation
plans of the larger steel corporations operating many plants
was the absence of proper machinery to take up questions of
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p
k.
company-wide
application, such, as Tor example a general wage
_
increase,
.Local plant managements were without authority to
give the representatives an answer on masters pertaining gen­
erally to ail corporation plants.
f
L
Thus, employee representa­
tives, failing to get satisfaction from local plant managers,
started to agitate for "central committees," composed of dele­
gates from the different plants, to deal directly with company
executives on more important issues.
Some companies were quick
to sense the structural weakness of individual plant plans and
encouraged dealings through central committees.
Others, how-,
ever, avoided such dealings lest the representatives become
k
unruly.
While recognizing that, perhaps in the majority of
I
'--'
{
instances, the representation plans in plants of United States
&
I;
Steel Corporation subsidiaries as well as the independents were
apparently functioning successfully from the standpoint of man­
agement, our chief objective at thi3 point is to trace the de- veiopment of weaknesses which worked to the advantage of the
SWOC.
In this respect, the Carnegie-Iliinoi3 plans were ap-
parentiy the most vulnerable, and at this company, therefore,
late*'
the SWOfydirected the spearhead of its campaign to "capture"
employee representatives.
r!
As early as May, 1935, representatives of the Edgar
Thompson Works at Braddock, Pa., had demanded a 10 per cent
wage increase, vacations with pay, and a representative of the
I
i
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
employees on the Board of Directors of the United States Steel
Corporation.
In September, 1935, delegates from various plants
of the American Sheet and Tin Plate Company (later merged with tIff
C a r n e g i e -Illinois
Steel Corporation) held a convention with
only hesitant acquiescence of management.
^
This "Sheet and Tin"
convention demanded of
the company a general
15per cent wage
increase, more liberal
pensions, vacations with pay for plant
workers, and important changes in the representation plan which
would provide for the appointment of an umpire to arbitrate un­
settled differences between management and men,-'1 The company
M
recognized the central
y
' accede to any of these
bargaining committee,
but itdid not
demands at the time#
In the plants of the former Illinois Steel Company near
f'
r
Chicago, there had been indications p„f outright revolt within
the company unions.
F-:'
In August, 1935, representatives at the
South Chicago plant voted to form an independent union.
2
In
January, 1936, 13 out of 25 representatives of the Gary Works
'Z.
formed the "Rubicon Lodge" under the wing of the Amalgamated.
In the Chicago area, representatives of United States Steel
Corporation subsidiaries had set up an Informal delegate body
known as the "Calumet Council".
Another central body, called
the "A ssociated Iron and Steel Employees Representatives,"
^•Por fuller description of the "Sheet and Tin" convention see:
Pitch, John A., "A Man Can Talk in Homestead," Survey Graphic.
February, 1936; also New York Times, October 27, 1935.
^See Pitch, John A., Op. cit.
Devinson, E., Labor on the March, New York, 1938, p. 193®
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
included delegates from the independent steel corporations as
well
Meanwhile, in the Pittsburgh-Youngstown district aggres­
sive representatives were demanding recognition of a central
bargaining committee for Carnegie-Illinois plants, later re­
ferred to as the "Steel Group"
(as distinguished from the
"Sheet and Tin Group" plants of the former American Sheet and
Tin Plate Company).
In November, 1935, the Clairton representa­
tives sent invitations to their fellows In nine plants of the
"Steel Group" for a "get-together dinner".
Without management
sanction, eighty representatives from seven of the nine plants
met in Pittsburgh in January, 1936, and resolved that a com­
mittee be appointed from among their number to bargain with
management on inter-plant issues.
This so-called "Central Com­
mittee " held meetings in February, March, and April.
The chair­
man, John J. Mullen of Clairton, remarked to the press: "We met
to improve and strengthen our plan with no thought of affiliating with an outside organization."
This committee made the
following demands of Mr. B.F. Fairless, President of CarnegieIllinois; first, recognition of the "Central Committee"; second,
;S
establishment of a Board of Arbitration (preferably a govern­
ment agency) to arbitrate all unsettled disputes between men
und management; third, a general 15 per cent wage increase; and
Vi
■m
fourth, establishment of the 40 hour basic work week with punitive
1q
bee Fitch, John A., Op. cit.
Pittsburgh Press. March 16, 1936.
*
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23
1
overtime pay*
Mr. Fairless did not recognize the "Central
Committee" because two plants in the district were not repre­
sented, but promised
to call a meeting in the future which
-
include these plants.
This meeting, however, was not
2
called until August, nearly two months after the SWOC drive
w ou l d
started.
Such were the more significant developments prior to
the appearance of the SVifOC.
In the Chicagp plants of the
Carnegie-Illinois Steel Corporation, representatives had set
up two independent unions as well as a central delegate body.
The "Sheet and Tin Group" had secured recognition by management,
but demands for wage Increases and compulsory arbitration had
been turned down.
In the Pittsburgh-Youngstown district, the
"Steel Group" was pressing the same demands along with the 40
hour week through the "Central Committee" which as yet was out­
lawed by management.
In short, representatives from nearly
every plant of the Carnegie-Illinois Company were demanding
major concessions of one sort or another which management felt
unable to grant. The drive for "central committees" indicated
the weakness of the bargaining power of isolated plant repre­
sentation plans with no membership organization behind them
to take concerted action.
Lacking a clear conception of their
ultimate goali, the representatives were using all means at
their disposal to make the plans effective bargaining agencies.-
^Pittsburgh Press. April 13, 1936.
See Page 3S.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
It was evident, therefore, that these plans
papy-awi^afe carried at least the seeds of independent unionism.
C.
The United Mine Workers and the Steel Campaign.
The United Mine Workers of America, under the leadership
of John L. Lewis, took advantage of the Recovery Act to recoup
their losses in the bituminous coal mines.
Not only were they
able to organize the central competitive field, but they were
also successful in penetrating traditional non-union strongholds
in Kentucky and 'West Virginia.
However, in the fall of 1933
the miners met stern resistance from the steel companies who
owned the so-called "captive mines".
The refusal of the steel
companies to sign agreements was due to the fear that union
contracts in the captive mines might serve as an opening wedge
for a concerted unionization drive on the basic steel industry.
Strikes in the Western Pennsylvania mines were followed by the
intervention of President Roosevelt and the Recovery Adminis­
tration.
In 1934, following Labor Board election^, the H.C.
Frick Company, a subsidiary of U.S. Steel, finally signed an
agreement wit^i the officers of the United Mine Workers as rep­
resentatives of the company's employees, but refused to recog­
nize the union as such.
The independent steel companies soon
followed the lead of "big steel" by making similar agreements.
Yet it was evident that the steel corporations were not pleased
hy unionization of the captive mines.
Although the 1934 convention of the American Federation
of Labor was in favor of a unionization campaign in steel, the
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Executive Council during the ensuing year did nothing to organ­
ize steel workers.
In the 1935 convention the proposal of the
industrial unionists was defeated, and on November 10th of that
year the Committee for Industrial Organization was formed within
the A.F. of L.
The United Mine Workers were dominant in the CIO
and their particular interest in steel had just been reiterated
by Lewis;
"We are anxious to have collective bargaining es­
tablished in the steel industry, and our interest
in that I s ....3elfish, because our people know that
if the workers were organized in the steel industry,
and collective bargaining there was an actuality, it
would remove the Incentive of the great captains of
the steel industry to destroy and punish and harass
our people who work In the captive mines throughout
the country....111
Furthermore, Lev/is and other leaders in the CIO were disgusted
with the destruction by the craft unions of newly formed indus­
trial organizations in the mass production industries.
The
failure of the insurgent rank-and-file movement in 1934 and
1935 within the Amalgamated had shown that steel workers could
not be organized except with outside assistance.
The action
of employee representatives in setting up central committees
indicated that many steel workers were not satisfied with the
company unions.
Steel was the keystone of American industry.
The United Mine Workers was the only union with sufficient re­
sources and leadership to build a union in steel.
^American Federation of Labor, Proceedings of the Fifty-fifth
Annual Convention, 1935, page 539.
r '
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
In February, 1936, the CIO sent to the Executive Council
of the A.F. of L. a conditional offer to contribute $500,000
toward a fund of $1,500,000 for the organization of the steel
workers.
In May, the Executive Council announced its own plan
to organize steel, in accordance with an agreement to be made
m
!'!;
with the Amalgamated Association, which was to have "due regard
g
and proper respect for the jurisdictional rights of all national
Wi
and international Unions. "■*■
After refusal of the
A.F. of L. Executive Council to
?-
accept money for a campaign in the steel industry along lines
to be prescribed by the CIO, Lewis put pressure directly on the
m
Amalgamated.
The convention of the Amalgamated in the spring
of 1936 forced its officers to accept the CIO proposal for or­
ganizing the industry.
An agreement was reached early in June
between the CIO and the Amalgamated containing these provisions:
:V.-
1. Appointment by Lewis of the Steel Workers Organ­
izing Committee which would have complete charge
of the campaign to organize the unorganized workers
in the steel industry.
2. Jurisdiction by the SWOC over all newly organized
workers.
A4
■■S
0,
^
3. Jurisdiction by the Amalgamated over its existing
membership and contracts already in force.
4. Contribution by the CIO up to $500,000 to finance
the new membership drive.
5. Termination of the organizing campaign by joint
discretion of the officers of the SWOC and the
CIO.2
1A«F. of L. Weekly News Service. May 16, 1936. "Organization
Plan for Steel Industry Outlined by Green."
For complete text of this agreement see Appendix "A".
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Lewis appointed Philip Murray, Vice President of the
United
by
Mine Workers, as Chairman of the SWOC.
Backed largely
U.M.W.A. money, Murray selected his staff mostly from the
ranks of the Mine Viforkers organization.
The Amalgamated,
though nominally represented in the SWOC, slumbered.
of unionizing steel had become the coal miners'
The task
job*
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
III.
A.
ORGANIZING- TACTICS AMD STRATEGY OP THE SWOC
Early Organization Strategy.
The job of organizing steel was one of mobilizing job­
conscious workmen who were afraid of unions.
Y/ith authority
concentrated in the hands of veteran strategists, experienced
outsiders as o r g a n i z e r s a n d strong financial backing, the
v -.v
Steel Workers Organizing Committee launched a drive wholly
different from previous uncorrelated, sporadic attempts at
~7
self-organization by the rank-and-file.
The SWOC has been
building the foundations for that which its leaders hope will
*
some day be an industrial democracy of steel workers,
A favorable economic and political environment assisted
the early campaign of the SWOC.
I
At the beginning of the drive
in June, 1936, steel was operating at about 70 per cent of
capacity.
By the time the SWOC had won its major victories
in May of the following year, operations were up to nearly
90 per cent, workers employed had increased by 50,000, and
payrolls had shown a 50 per cent rise.
There had been a boom
in steel.
Politically the SVYOC was triumphant.
The Wagner Act
had been passed in 1935^ and the union was quick to register
complaints with the National Labor Relations Board of unfair
labor practices by the employers.
'
The La Follette Civil Liber­
ties Committee was engaged in uncovering evidence of industrial
espionage and other measures hitherto used to combat outside
Si
.y,
:§
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
unions.
In Pennsylvania the Lieutenant-Governor was an of­
ficial of the Miners1 Union and was instrumental In securing
state police protection in the "very tough towns."
Moreover, „
in the national elections of 1936 steel workers voted over­
whelmingly in favor of the New Deal with which the SWOC had
identified its cause.
Following the election a feeling of
:.:y
^
emancipation, the SWOC claim ed, S p e l l e d workers to join
UJ
CIO "in droves ."
the
The favorable economic and political factors, however,
should not eclipse the brilliant strategy of the SWOC leaders
.
during the first nine months of the drive.
Remembering that
national and racial animosities were among the causes of failure of former attempts at unionization, the SWOC welcomed the
i
fg
support of Negroes and groups of foreign-born workers, thus
promoting the ideals of fraternity and unity among workers of
every creed, color, and nationality.
Expecting the employers to fight the drive through
■■'i'
■if:
coercion and discharge of workers for union activity, the SY/OC
legal department retained local counsel in important steel com­
munities to assist the organizers when necessary, and arranged
for bail bonds to protect them in case of arrest by local au-
1
Q-i-
thorities.
Developments In steel were headline news, and the
publicity department sent to nearly 1,000 leading newspapers
and press associations almost daily reports of SWOC progress,
fhe research department co-operated with outsiders and the SWOC
^
staff in supplying useful factual information.
The SWOC was a
ft
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
businesslike organization conducting a "streamlined" union­
ization campaign.
The methods used in recruiting members show forethought
in avoiding mistakes made in previous efforts.
The first few
months were devoted to advertisement of the campaign.
To at­
tract attention, mass meetings were staged, and addressed by
SVJ0C staff members, ministers, professors and congressmen.
Speakers were careful to emphasize that President Roosevelt
and the New Dealers were anxious that the workers should organ­
ize.
"Plying squadrons" of automobiles invaded the steel towns,
and sound trucks broadcasted the union message in several lan­
guages.
"Our first problem," said Chairman Philip Murray,
"was to banish fear from the steel workers' minds."
For many months the signing up of members was carried
on under cover.
After an organizer had approached a few union
sympathizers, he would proceed to set up a "mill organizing
committee."
The committee members contacted the workers in the
mills, their homes, and local saloons.
The function of the or­
ganizer was to direct activities, and to keep the SWOC national
headquarters informed of problems and progress.
Local lodges
were not established on a large scale until six months after
the drive had started.
The Amalgamated had proceeded to create-
lodges at once; then, the companies would promptly discharge
the leaders, and the lodge would vanish.
The strategy of the
SWOC dictated that the identity of all those who joined should
be kept secret until the union became so strong that discriminating tactics on the employers1 part would be difficult.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Signed
membership application cards
7/ere
mailed each week to the n a ­
tional offices, the names on them being kept confidential.
Beginning in January, 1937, however, scores of lodges
were set up.
The companies had discharged very few union m e m ­
bers; the national elections had gone against the "bosses’1;
"progressive" employee representatives were openly flaunting
Y/;
the "company unions"; fear was disappearing.
By the time the Taylor-Lewis agreement was announced
on March 2 the SWOC had perhaps 150,000 signed membership cards.
N;*
Yet the membership was on paper only, for dues payments had been
1
suspended.
Nevertheless there was apparently strong moral support of the CIO, particularly following the victories won in
m
General Motors plants in January.
The SWOC had created a labor
is
»
movement in the steel industry.
ssi
■
vSssi
;c
f'S'S
s:s:1
B. "The Capture" of the Carnegie-Illinois Employee Representa­
iSli
tion Plans.
Important as was the strength of the SWOC movement, no
less so was the "revolution" that developed in the representa­
tion plans of the Carnegie-Illinois Steel Corporation, the
_
■■ ;.
■
principal subsidiary of U.S. Steel.
The vulnerability of the
11,11
plans In this company was pointed out in the previous chapter.
..
oefore the advent of the SWOC several of the plant bodies had
requested substantial wage increases and the establishment of
the 40 hour week with time-and-one-half for overtime.
S'S
The repre­
sentatives were also pressing, apparently unsuccessfully, for
1
Is
•I:S
Collection of dues was suspended in November, 1936, and resumed
in April, 1937.
-V.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
recognition
of "central committees" in the Pittsburgh and
Chicago areas»
Trade unionists of the "old school", in their condemna­
tion of "company unions", have looked upon employee representa­
tives as tools of management and company "stooges".
To the
SWOC leaders, however, the employee representation plans be­
came an effective tool.
The SWOC attitude is well expressed
in the words of Chairman Philip Murray:
"It was apparent to us that to make any
progress in steel we had to first C a p t u r e 1 the
company unions. We realized that a great many
of the employee representatives, perhaps the ma­
jority, were men honestly interested in doing a
good job under the Plan which had been imposed
upon them and their fellow employees.
Our job
was to show these men what real unionism meant.
To denounce them all as company agents or stooges
would be both untruthful and poor strategy. There­
fore we set out to win these employee representa­
tives to TrT-------------------------------------------the cause of the SWOC and industrial
unionism.
V.
$
In large measure the capture of the Carnegie-Illinois repre­
%
sentation plans was responsible for the eventual success of
t-:'
the drive on the United States Steel Corporation.
.:
■
As illustrative of general strategy let us describe how
■. .
the SWOC approached representatives of the Carnegie-Illinois
r:hf-
mills in the Pittsburgh-Youngs town district.
Two SWOC staff
:
v:v V
men contacted nearly every representative in the district.
At
first no attempt was made to get the representatives to join
the SWOC.
M
■hi;
'i9\
I
Rather the representatives were given friendly advice
Steel Workers Organizing Committee, Reports of Officers to the
Wage and Policy Convention, Pittsburgh, December, 1937, page 9.
(Underlinings inserted.)
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
on how to formulate and present demands to management through,
the regular "company union" machinery, encouraged in their ef­
forts to win recognition of central bargaining committees,
supplied with factual data to
support their demands
by theSWOC
research department, and even
invited to SWOC staff
meetings.
In commenting on this strategy to the writer Clinton S. Golden';
SV/OC Director of the Northeastern region, explained:
"Our purpose was to keep the representatives
constantly ’biting at the heels' of management with
all sorts of demands, most of which we knew were im­
possible for the company to grant at the time.
"Every time the company refused to give in or
delayed its answer to the demands, we were able to
demonstrate to the representatives the futility and
hypocricy of the company unions. Soon the more ag­
gressive representatives voluntarily aligned them­
selves with our cause.
But we were very careful
not to disclose their identity as we did not want
the company to fire any of them.
Their effective­
ness as leaders and their contacts with fellow work­
ers in the mills would be lessened by such action."
The outside pressure of the unionization drive strengthened the
position of all employee representatives in presenting demands
to management, although an examination of the minutes of meet­
ings during the summer of
either
1936 indicated that the majority were
opposed to outside affiliation or afraid to denounce the
plans openly.
For the first two months of the SWOC drive, when
the pro-CIO representatives acted "under cover," management
might have felt confident that the representatives were strongly
anti-CIO.
Several plant bodies had passed resolutions expressing
endorsement and support of the plans.
In some cases, these had
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
been
?
backed up by anti-CIO petitions which had been circulated
--
among the plant workers.
What the company officials as well
as many so-called "loyal" representatives overlooked was the
fact that the pro-CIO representatives were reporting to SWOC
Li
headquarters everything that transpired in the joint meetings.
1
During July and August of 1936 employee representatives
I
.v:
in the Pittsburgh-Youngstown district were growing more rest­
o
less.
In answer to demands for the 40 hour basic work week,
U.S. Steel, followed by the principal independents, announced
that, effective August 1st, time-and-one-half would be paid
for work in excess of eight hours a day or 48 hours a week.
o
Philip Murray retorted, that this action was tantamount to
imposition of the 48 hour week.
Several employee representa­
tives in the industry denounced this "concession" and refused
to accept it.
1
.ivi
Fred Bohne, an anti-CIO representative who at
the time was leading the movement for recognition of the "Cen­
tral Committee" for plants of the Pittsburgh-Youngstown dis-
W\
trict, referred to this action by the steel industry bitterly
as follows: "One hundred organizers for John L. Lewis could
not have done as much good for an outside cause as this did."
Realizing that the plans of employee representation
would have to be revised because of ever-increasing pressure
The writer is obliged to the SWOC research department for copies
of minutes of oompam.y—milear meetings in several Carnegie-Illinois
plants as well as a complete file of records of meetings of the
"Central Committee" and Pittsburgh District General Council.
^Hew York Times. July 24, 1936.
^Minutes of "General Joint Conference," August 12, 1936.
:
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
for recognition of the "Central Committee," the Carnegie-Illinois
Corporation called a "General Joint Conference" of representa­
tives from the Pittsburgh-Youngstown steel plants
Group").
(The "Steel
Vice President Burnett, in addressing the delegates
on August 12th, admitted that the company had delayed too long
in answering many demands, but expressed the hope that the em­
ployee representation plans, although not perfect, could be
revised and improved.
After voicing dissatisfaction with the
48 hour week ruling in the industry, the delegates came forth
with demands for a $5.00 daily rate for common labor, an in- crease of ij|>1.12 a day for all other plant workers, and estabhii
|t
lishment of the 40 hour basic week with time-and-one-half
v ;t'.
overtime pay.
It was generally understood at this time that
the company would approve amendments to the plan recognizing
a central bargaining c o m m i t t e e C l a i m i n g initiative of the
SI
tii
[V#
wage and hours demands, SYtfOC leaders described this meeting
under a headline in Steel Labor thus: "35,000 Company Unionists
Under Influence of Steel Union Drive.
Meanwhile, a substantial group of employee representa-'
it-
tives in the Chicago area were in open revolt.
Roland Eckert,
General Secretary of the employee representatives at the CarnegieIllinois Gary Works, called a meeting of other representatives in
the Chicago area for August 19th, the purpose of which was to
S'S-
whip up support for the CIO.
Seventy-three of eighty-five
1
Minutes of "General Joint Conference," August 12, 1956,
Steel LaborT August 20, 1936.
_
11
.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
representatives present resolved to join with the SWOC to per­
fect
a powerful industrial organization of all steel workers
to secure collective bargaining in the industry*"*"
Up to this time, as already pointed out, the identities
of pro-CIO representatives in the Pittsburgh-Youngstown area
h-
were uncertain.
All groups, both pro-CIO and anti-CIO, ap­
peared to be united, on the surface at least, at the meeting
of the General Joint Conference.
The apparent willingness of
management to recognize the "Central Committee" and to consider
3
■ .;
*■/>
its demands was encouraging to those representatives who had
..
been fighting to strengthen the plans.
Consequently, the SWOC
strategists were anxious to counter this development by captur­
II
ing the "Central Committee".
SWOC called a special meeting of the "Central Committee" on
August 25th.
si
’■ift
By clever indirect methods, the
Since the chairman of the committee, Pred Bohne,
was known to be strongly opposed to outside influences, the
S-:
call for the meeting was sent by John Kane who, though not a
W
||i
member of SWOC, was nevertheless sympathic to the CIO.
Y:
purpose of this meeting was to put
The
through a resolution endors-
ing the SWOC drive and to unite the pro-CIO representatives of
SI
"che Chicago and Pittsburgh areas.
Prom prior contacts with
representatives who were to attend
this meeting, the SWOC es­
timated that the pro-CIO employee representatives could muster
SS; 1
sufficient support to pass the proposed resolutions. The SWOC
J’The "call" for this meeting as well as the minutes were found
in SWOC files.
•? ...
Y.;r
■W.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
I:
had arranged to pay all travelling expenses of the delegates.
If
If
/;:
At this meeting, in addition to members of the "Central
Committee," were three militantly pro-CIO Chicago representa­
tives, whom the SWOC had brought to Pittsburgh to present
IV
11
IS
ff•I?
formal demands to the Carnegie-Illinois management.
These
delegates urged the members of the "Central Committee" to
unite with the Chicago group in demanding that a national wage
agreement for all Carnegie-Illinois workers be negotiated with
the company by a national wage scale committee under direction
of SWOC.^
If
il
IS
i
11
The principal demands were as follows: establishment
of the universal 40 hour week with overtime pay, a 25 per cent
general wage increase with the |>5.00 daily rate for common
2
labor, and provision for seniority rights.
Half of the mem­
bers of the "Central Committee" present joined with the Chicago
delegation in presenting these demands as the "Chicago-Pittsburgh
1
Representatives Council".
:
from outside influences.
fl
m
the two groups of representatives was clearly defined: in one
The others resolved to stay aloof
From that time on the cleavage between
camp were the "progressives" who espoused the cause of the SWOC,
and in the other were the "conservatives" who, with management
support, sought to revise and strengthen the representation plans
SII
The progressives reiterated their demands to the company on Sep­
tember 9, 1936, but the company regarded the Chicago-Pittsburgh
‘'"Minutes of meeting of the "Central Committee," August 25, 1936.
These demands were set forth in a letter to B.F. Fairiess,
President of the Carnegie-Illinois Steel Corporation, dated
August 25, 1936.
I T
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
58.
8:5
S-<«
Representative
meanwhile,
Council as an outlaw body.
The conservatives,
were preparing for formal recognition of the "Cen­
tral Committee" as contemplated by the General Joint Conference.
By the first of September, 1936, nearly all plant em­
ployee representation bodies of U.S. Steel subsidiaries, toSi
gether with the various central delegate bodies, had demanded"
overtime pay for work in excess of 40 hours per week and wage
I
increases ranging from 10 to 25 per cent.
In an open letter to
the representatives on September 8, 1936, the Carnegie-Illinois
8558
president, Mr. B.F. Fairless, though leaving the road open for
further negotiation, announced; "We are regretfully stating,
Si
however, that it is our conclusion that a wage increase should
not be granted at this time."-*-
Answering this statement a week
later, Philip Murray retorted; "The growing tide of SWOC’s cam­
paign compels a wage raise, and the steel Industry, with U.S.
Steel leading, will grant it."^ Mr. Fairless’s refusal to grant
8.85.
wage increases apparently made the employee representatives
more eager for concession.
The central committee of the "Sheet
and Tin Group" demanded Immediate wage increases.
The Homestead
representatives, controlled by conservatives, reaffirmed the de'
mand for the $5.00 daily rate for labor and a $1.12 a day increase
^
for all others.
Youngstown representatives v/ere threatening to
unite all employees who owned U.S. Steel stock to force a wage
advance.^
'
Urging that the CIO was making a political issue of
^Letter to Employee Representatives of the Youngstown District,
September 8, 1936.
2
Steel Labor. September 25, 1936.
Ibid.. September 25, 1936 and Iron A g e , various issues in
September and October, 1936.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
■" th9 wage question, conservative representatives were insist­
ing that increases be granted at once.
Fred Bohne warned that
failure to settle this question was threatening the peaceful
-relations between management and men.
He pointed out that the
"representatives and the employees are, on the whole, loyal
and deserve the utmost sympathy and the greatest help in their
effort to keep aloof from outside influences” .-*-
The conserva-'
..tives, obviously, were anxious to take full advantage of the
pressure of the SWOC drive to wring concessions from the company
Meanwhile, tne President of the United States Steel Cor­
poration and the Vice President in Charge of Industrial Rela, -tions had urged Mr. Myron Taylor and the Board of Directors to
grant wage increases through a written contract with employee
representatives.
A committee, appointed by Mr. Taylor to study
this proposal, recommended;
That a wage adjustment providing for an increase
in the common labor rate from 47 cents to 52# cents
($4.20 per 8 hour day) should become effective on
November 15, 1936.
That insofar as possible, this wage adjustment
should be evidenced by a contract signed jointly by
the management and employee representatives at each
plant.
That in order to negotiate such a contract for
a term of one year, it would be necessary to safe­
guard the position of both employees and management
against wide fluctuations in the cost-of-living. It
was, therefore, recommended that the cost-of-living
index; and current general wage levels be assumed as
bases which would be expected to move in concert.2
-st,
,-oSSgiw?."Age„
■■■——v"' October 8„ 1936.
-v-- I?-1''■"aylor, Myron C., Ten Years of Steel, extension of remarks at
^=r%h.e Annual Meeting of Stockholders of the United States Steel
Corporation, April, 1938.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
the wage question, conservative representatives were insist­
ing that increases be granted at once.
Fred Bohne warned that
failure to settle this question was threatening the peaceful
relations between management and men.
He pointed out that the
"representatives and the employees are, on the whole, loyal
!
and deserve the utmost sympathy and the greatest help in their -
i'.:
I
effort to keep aloof from outside influences".-1- The conserva­
f:'
tives, obviously, were anxious to take full advantage of the
f:
RR
pressure of the SWOC drive to wring concessions from the company.
Meanwhile, the President of the United States Steel Cor-
f
poration and the Vice President in Charge of Industrial Rela­
tions had urged Mr. Myron Taylor and the Board of Directors to
grant wage increases through a written contract with employee
representatives.
II
A committee, appointed by Mr. Taylor to study
this proposal, recommended:
That a wage adjustment providing for an increase
in the common labor rate from 47 cents to 52^- cents
($4.20 per 8 hour day) should become effective on
November 15, 1936.
L
r~
Is
R1
That insofar as possible, this wage adjustment
should be evidenced by a contract signed jointly by
the management and employee representatives at each
plant.
That in order to negotiate such a contract for
a term of one year, it would be necessary to safe­
guard the position of both employees and management
against wide fluctuations in the cost-of-living. It
was, therefore, recommended that the cost-of-living
index and current general wage levels be assumed as
bases which would be expected to move in concert.2
^Iron A g e . October 8, 1936.
^Taylor, Myron C., Ten Years of Steel, extension of remarks at
the Annual Meeting of Stockholders of the United States Steel
Corporation, April, 1938.
H
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
rhe Board of Directors ratified these recommendations, but
postponed announcement of wage increases until after the na ­
tional elections in November.
This delay was the cause of
much resentment on the part of the representatives, who had
h:--
Mi
urged management to sidestep charges of political plotting by
i
granting concessions before election.
By the middle of October conservative representatives
of the "Steel Group", working in concert with management, were
-V
agreed upon an amendment to the plan of representation which
»
m
v-r.r;
would give formal status to a central delegate bargaining com­
mittee.
Under "Article 9^-", a central joint body was to be
m .
set up composed of an equal number of management and employee
delegates from the nine "Steel Group" plants.
s%
ft
In order to
frame demands, employee representatives were accorded oppor­
:■!
'
■
8
S
ft
tunity to meet separately the day previous to the joint session
with management.
The central body was to take up all inter­
plant demands referred to it by the various plant bodies.
v
II..
Settlement was to be attempted' by vote of members at the joint
session.
Failing a majority vote, the employee delegates would
be permitted to refer the matter to the President of the com­
ftl
If
pany.
If settlement was not reached at this stage, the matter
could be submitted to outside arbitration if the President of
the company apd. the employee representatives both agreed to
ft
such arbitration.
Obviously, the company could block arbitra­
tion if it so desired.
Progressive representatives, although
Both conservative and progressive representatives told the
writer that they felt management purposely delayed this an­
nouncement for political reasons.
&
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
elected, delegates to the central body, were not in position
to control a majority vote among the "Steel Group".
Never-
t; 1
theless, at the last minute the nine plants of the "Steel
Group" were merged with nine plants of the "Sheet and Tin Group
to form a single central body known as the "Pittsburgh District
General
Council".
Thirty-four employee representatives from 17
plants met on November 9th.
To the surprise of all concerned,
the most out-spoken pro-CIO representative in ttie district,
Elmer J. Maloy, was elected chairman by a plurality of four
votes.
Maloy had openly expressed his contempt for the em­
ployee representation plans.
of the SYifOC at that very timei
In fact, he was on the payroll
Most of the members of the
"Sheet and Tin Group", apparently, had been brought in line by
a "deal" made with the pro-CIO representatives in the "Steel
Group".
Li-vg;:
A greater blow to management, however, was the refusal
of many employee representation bodies to execute the wage con­
s
tracts.
As Mr. Taylor expressed it:
"The contracts and the
• 'v.v
wage increase served further to activate the Steel Workers Or­
1
ganizing Committee, for some of the employee representatives
refused to sign a contract and others signed with reluctance.
The reasons which prompted certain individuals In the Corpora­
tion to recommend the cost-of-living wage contracts might have
teen these.
In the first place, it was apparent that manage­
ment was swamped on ail sides with demands for wage increases.
^Taylor, Myron C., Ten Years of Steel, p. 40.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Harmonious
on
relationships with the representatives were dependent
settlement of this troublesome issue.
It was expected that
the agreements would sidetrack the wage Issue for at least one
r
year.
As the cost-of-living was rising rapidly, it was neces­
sary to safeguard against premature opening of the question
Sc*
again by providing for automatic wage adjustments in accordance
with changes in the index of the cost-of-living.^
In the second
place, once the wage issue was settled and the representatives
had committed themselves to a signed agreement, the 3WGC would
be "locked out".
Those who sponsored this plan, however, apparently underestimated the strength of SWOC within the ranks of the employee
representatives.
Press releases of the SWGC created the im­
pression that U.S. Steel intended to bind the workers permanently
to their existing standard of living.
Pressure was put on pro­
gressive representatives to reject the contracts.
Financed and
counselled by the SWOC, Elmer Maloy and George Patterson, out­
spoken progressive representatives on the SWOC payroll, rushed
to Washington to protest to the Secretary of Labor.
Miss Perkins
conveniently expressed the opinion that employee representatives
1
The cost-of-living clause provided that, should the index of
the cost-of-living (as determined by the U.S. Labor Department)
rise beyond the 10 per cent increase provided for (It being
assumed that wages were being raised by the agreement 10 per
cent above the existing cost-of-living index), the wage levels
would automatically be increased by 5 per cent when the index
had risen to that extent. Similarly a fall in the cost-ofliving of a full 5 per cent would automatically call for a
downward adjustment to the same extent.
R eproduced with permission o f the copyright owner. Further reproduction prohibited without permission.
lacked
f
authority under the by-laws of the representation plans
to negotiate such contracts on behalf of the employees.’*’ Typicai
of the reaction of representatives in plants where CIO
Influence was strong was this position taken by the representatives at the Carnegie-Illinois Duquesne W o r k s :
!3
I
If
■■■■
First, the wage Increase was accepted but
condemned a$ "inadequate".
Original demands of the
^5.00 daily rate (62-g- cents hourly) for labor
and ^>1.24 increase for others were repeated.
Second, the representatives claimed that
they lacked authority to negotiate a contract
on behalf of their constituents.
[33
if
Third, the cost-of-living feature was re­
jected as a measure of arriving at just com­
pensation for labor.2
Nevertheless, several employee representation bodies, which were
controlled by conservatives, signed the contracts.
This was
true of some plants of Carnegie-Illinois and most of the plants
3
of other U.S. Steel subsidiaries.
It was evident that the wage contract proposal was a
boomerang to the U.S. Steel subsidiaries, in particular to the
Carnegie-Illinois Corporation.
The wage issue was not settled,
for management was at once stormed on all sides with demands
33';.3
hi
m
for further concessions.
Most important, the United States Steel
Corporation had openly set the dangerous, for it, precedent
frirh
1:3
of negotiating signed contracts with representatives of its
r•-:
'X
employees.
t.
=
^New York Times. November 14, 1936.
o
From statement secured In the SWOC files.
3
In the New York Times, November 10, 1936, it was reported that
12 Carnegie-Illinois plant "bodies" representing 23,700 workers
signed the contracts while nine representing 36,000 either re­
jected the whole agreement or the cost-of-living feature.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
During October and. November of 1936 the SWOC organized
district councils of representatives at meetings held in Pitts­
burgh, Youngstown, and Harrisburg.
i':.;
It
k>'
On the surface it appeared
that these "get-togethers'1 were spontaneously organized by
representatives from various plants to discuss mutual problems
and to lay the groundwork for a national organization of em­
ployee representatives in the steel industry.
■.;
>•-
Resolutions were
• ■
g;.
passed demanding wage increases and protection of workers*
rights of self-organization, but no mention was made of affiliation with the CIO.
The prime movers of these meetings, however,
were Elmer Maloy and one or two other representatives who were
paid by SWOC.
Before the first of these meetings, SWOC field
organizers were instructed to send to the national office a re­
port of all representatives who might be expected to attend and
to indicate whether they might be conservative or progressivei
mi
To climax these "get togethers", Maloy called a general
,
meeting of progressive representatives from all steel plants
East of Cleveland for December 20th.
Philip Murray, Chairman
W:
of SWOC was invited to speak, as was Arthur Young, Vice Presi­
I
dent in Charge of Industrial Relations for U.S. Steel.
Clinton
S. Golden sent out instructions to his SWOC staff in the North­
eastern Region which read in part:
m
"This meeting will climax our six months of
activity In courteously soliciting the support
of company unionists. We are told a large attend­
ance is expected. A room to accommodate four to
five hundred has been contracted for.
It must be
filled . . .
If need be, arrange transportation
so as to be sure a good representation attends the
meeting from your area."3Statement secured from SWOC files.
■/
1
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
f
About 250 representatives from 42 steel plants attended.
Ll
Mr. Young did not appear.
Mr. Murray in a stirring address
['
M
denounced "company unions" and urged all present to declare
openly for the CIO.
ship cards.
To a man, all present signed SWOC member-
Then the group, assuming the name "CIO Repre­
sentatives Council", resolved:
:
That steel workers should be organized into
a national industrial union;
i
That employee representatives should exert
their influence to enroll members for SWOC;
|L
That steel workers should be informed that
the company union is a sham, a snare, an Insult
to the workingman, and a device of management;
|y
i
That pro-CIO representatives should remain
inside the company unions "for reasons obvious
to all".l
tf/ith this meeting the SWOC drive to smash the employee repre-
hA
|g|
sentation plans reached its peak.
Meanwhile, the SWOC had launched an offensive on another
front.
i:,lv
Late in November the union filed a complaint with the
-
National Labor Relations Board charging the Carnegie-Illinois
.
. .
Steel Corporation with domination and financial support of the
IS
,
rr
representation plans, Interference with rights of employees to
bargain collectively through representatives of their own choos­
It! ing,
LSI
and coercion of representatives In signing wage contracts.
Hearings before the Board in Washington started on December 17,
1936^and continued through the next two months.
Progressive
The writer was present at this meeting.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
representatives vehemently voiced their objections to the plans
as set up by the company.
I
|
The Board dropped proceedings before
the company and conservative representatives were able to pre1
sent their case.
The net effect of these hearings, therefore,
was to publicize the objections of the opponents of employee
representation at a time when the SWOC was preparing for a show­
down .
The militant action taken by the progressive representa­
tives stirred the conservatives to action.
Hard campaigning by
ardent conservatives in November had failed to muster the neces­
sary vote to oust Maloy as chairman of the Pittsburgh District
General Council.
At a meeting on January 6th, however, con­
servatives defeated the Maloy supporters and elected one of
their own group to the chairmanship.
At the same meeting a
resolution was carried calling for defense of the representation
plans against outside agencies.^
On recommendation of the Pittsburgh District General Council,
I
.
|
conservative representatives secured management backing of the
!
"Grievance Committee", referred to popularly as the "Little Su-
r
[=
preme Court".
This committee, composed of four representatives,
J-
all conservatives, had authority to visit various Carnegie-
|
I*
it
Illinois plants, investigate causes of dissatisfaction with em­
f
ployee representation, report instances of lack of co-operation
When
tract
case.
April
o
Iron
the Carnegie-Illinois Steel Corporation made a written con­
with the SWOC, there was no longer any interest in this
The Company formally withdrew recognition of the clans on
26, 1937.
Age. January 14, 1937, page 68.
‘■ | 3 F
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
on the part of management’s rank-and-file, and recommend remedial
measures.
That tills committee had "independent" spirit is sug­
gested by the following statement by one of its members:
"We're not going to be a bunch of monkeys on
this deal. If we find some Simon Legree in one of
these plants, we're going to take the cracker off
his whip . . .
We're not going to call an open
-season on foremen and superintendents, but we want
to make the plan as perfect as possible, and if it
has to be done by plowing some of those fellows under,
that's what we'll have to do."-*Mr. B.F. hairless, President of Carnegie-Illinois, said to the'
committee members:
"You come and go as you see fit.
you to the limit.
We'll back
If the men want the plan, we want it.
p
men don't want it, we don't want it.
If the
The spokesmen for conservative representatives in the
Pittsburgh-Youngstown area were members of the "Defense Com­
mittee".
Securing funds allegedly by contribution from employees,
this committee engaged an attorney and publicity agent to present
the case for employee representation to the public and the Na|
tional Labor Relations Board,®
p
also, where the pro-CIO representatives stood in open opposition
I
r
Meanwhile, in the Chicago area
to the representation plans, pro-company representatives were
defending them.
A middle group organized an association called
the "Steel Employees Independent Labor Organization",
r
In January and February, 1937 individual plant bodies,
'
:
central committees, CIO representatives councils, and independent
^Press Release by H.G. Fickes, Publicity Agent for the "Defense
Committee", Pittsburgh, January 16, 1937. (Secured from SWOC files,
2Ibid.
»z”
CxO charges that the company gave financial assistance to the
"Defense Committee" were never proved conclusively.
_
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
unions were clamoring for further concessions.
The Pittsburgh
District General Council demanded the ij?5.00 daily rate for com­
mon labor, an 80 cent per day increase for all others, and the
40 hour week with time-and-one-half pay for overtime.
Some
of the independent groups added double-time pay for Sunday work.
The pressure of these demands was felt throughout the entire
steel industry.
Once more it was apparent that industrial peace
and harmony were dependent on making concessions.
It was apparent that the employee representation plans in
the Carnegie-Illinois Steel Corporation had virtually collapsed.
Civil war had shattered management's hopes of "collective co­
operation".
All employee groups were fighting management for
concessions, and fighting each other for credit in securing such
concessions.
One company official remarked to the writer as
early as February, 1937, that employee representation was on its
way out, and that, in his opinion, the workers were probably
going to set up their own self-supporting organizations inde­
pendent both of the company and of the CIO.
Th-e~----snea-rhea-d~--crf1--
TEhe SWOC drive had practically destroyed employee representa­
tion in the largest subsidiary of the United States Steel Cor­
poration.
By thus "capturing" the employee representation plans
in the largest subsidiary of U.S. Steel, the SWOC put itself
in a strong bargaining position.
It was apparent that the SWOC
had outmanoeuvered "big steel" at almost every turn.
^Steel Labor. February 20, 1937.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
When
49
management made concessions to the employee representatives,
the SV/OC took the credit.
On the other hand, whenever the
representatives were unable to secure concessions, the Sv/OC
was able to demonstrate the weakness and ineffectiveness of
the employee representation plans.
The Carnegie-Illinois repre­
sentation plans, instead of erecting a barrier against the in­
roads of outside union organization, became tools ready for the
hands of the SWOC leaders.
The capture of the Carnegie-Illinois
representation plans might well be recorded among the most de­
cisive victories for organized labor in the history of American
trade unionism.
E
fi
C.
The United States Steel Agreement of 1957.
In a statement prepared for the stockholders of the United
States Steel Corporation in 1938, Mr. Myron C. Taylor revealed
is
I
in part the events which led up to the signing of the peace-pact
with the SWOC in March, 1937.1
In the course of private con­
versations, Mr. Taylor showed Mr. John L. Lewis of the CIO this
formula:
”The Company recognizes the right of its employees
to bargain collectively through representatives
freely chosen by them without dictation, coercion
or intimidation in any form or from any source. It
will negotiate and contract with the representa­
tives of any group of its employees so chosen and
with any organization as the representative of its
members, subject to the recognition of the principle
that the right to work is not dependent on member­
ship or non-membership in any organization and sub­
ject to the right of every employee freely to bargain
In such manner and through such representatives, if
any, as he chooses.''^
Taylor, Myron C., Ten Years of Steel, pp. 23-45.
pages 41-42. (Italics inserted.)
2 Ibid..
t
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
On February 28, Mr. Lewis and Mr. Murray, representing
the CIO, and Mr. Taylor and Mr. Moses, representing the Cor­
poration, accepted this formula in principle.
agreed
It was then
that, with the approval of the Board of Directors of
the Corporation, Mr. Murray would negotiate within the terms
of the formula an agreement with Mr. B.F. Fairless, President
of the Carnegie-Illinois Steel Corporation.
On March 2, 1937,
Mr. Fairless and Mr. Murray signed a preliminary contract recog­
nizing the SWOC as the collective bargaining agent for those em­
ployees who were its members.
$1
u
The full demands of the SV/OC and
employee representatives for wage increases and the 40 hour week,
which were also announced at this time by the principal inde­
pendents, were incorporated in the agreement.
On March 17, a
formal contract between the SWOC and Carnegie-Illinois was signed.^"
The other principal U.S. Steel subsidiaries signed similar agree­
p
p
I™
ments.^
In his address to the stockholders Mr. Taylor emphasized
two basic reasons for the signing of the SWOC contract.
He de­
sired to avoid a strike, and he was able to make an "honorable
settlement” with Mr. Lewis "that would ensure a continuance of
work, wages and profits."^
The reasons why Mr. Taylor and the Board of U.S. Steel
were unwilling to risk a strike can only be suggested.
As already
^For discussion of this agreement see ,ga#e C h a . p t 9 t ~ JciXL .
^American Steel and Wire Company, National Tube Company, Columbia
Steel Company, Tennessee Coal, Iron and Railroad Company. A gen­
erally similar contract was later signed by the American Bridge
Company and the Virginia Bridge Company.
Taylor, Myron C., Op cit. , page 40.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
51.
pointed out it was apparent that the union movement was strong,
and undoubtedly there were enough sympathizers to close down a
good many plants.
The SV/OC, ably led and adequately financed,
had also strong political alliances.
The Earle administration
in Pennsylvania had already expressed sympathy with the union­
ization drive, and the importance to the union of a friendly
state administration had been demonstrated in the General Motors
1
strikes. Domestic and potential foreign demand for steel was
strong, and U.S. Steel plants were operating at well over 80
per cent of capacity.
2
The defenses of U.S. Steel were weak,
for the disruptive tactics of the SV/OC had wrecked the representation plans in the Carnegie-Illinois plants.°
In the event
of a strike, therefore, the SV/OC was In a strategic position.
Finally, Mr. Taylor was able to dictate the principal terms of
g
the contract.
The union was to be recognized as the bargaining
only
4
agent/for those employees who were its members.
The Taylor-Lewis agreement is significant in these re­
spects.
It grew out of negotiations between a single officer
of U.S. Steel and a single officer of the CIO.
U.S. Steel,
although adhering to its slated policy of representation ended
H
gj
gl
■^It was rumored that the British government was about to place
large orders for armaments in America.
^Iron A g e . April 15, 1937, page 77.
^The plans were still strongly entrenched in most of the large
independent steel corporations at this time. SV/OC had concen­
trated its attack on Carnegie-Illinois.
^This principle of representation had been set forth in the cap­
tive mines agreements. According to Mr. Taylor, the 1S36 wage
contracts with employee representatives were based upon the same
policy. The SV/OC contracts, therefore, were completely in accord
with the same policy of contracting with representatives of any
employees. Taylor, Myron C., Op. cit. , page 43.
ibS
, ■
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
I
its former practice of sponsoring representation plans and op­
posing outside unions, thus implying an endorsement of the SWO'C.
|
Finally, it caused the SWOC to deviate from its original objec-
I:
tive of collective bargaining on an industry-wide basis.
I
independent companies would have to be forced by the union to
i
"follow the leader".
I
separate contracts with each employer instead of a single col-
p
lective agreement with an organization composed of the principal
p
ti
producers.
The
The SWOC was thereby obliged to make
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IV.
D.
ORGANIZING- TACTICS AND STRATEGY OF THE SWOC
(Continued)
SWOC Victories —
March to May, 1957.
For three months after the signing of the U.S. Steel
agreements, the unionization drive had the momentum of a tidal
wave.
By May 1 the SWOC claimed over 500,000 members, 600
lodges and 114 signed agreements in various steel and allied
fabricating companies.’*' But in spite of the fact that the
Supreme Court, by declaring the 'Wagner Act constitutional,
sounded the death-loneli of most employee representation plans
in the industry, none of the large independent companies with
the exception of Wheeling Steel had signed contracts.
In May the spotlight focussed on the Jones and Laughlin
Steel Corporation.
In negotiations with the SWOC that company had
offered to sign the standard Carnegie-Illinois contract, provided
§
management retained the right to make similar contracts with other
groups of employees.
Fearful that management might promote a com­
pany union the SWOC rejected this proposal.
The company, feeling
that the SWOC did not have a majority, then offered to agree to a
NLRB election within a few weeks and to concede the SWOC exclusive
bargaining rights if the majority of employees so voted.
The SWOC
countered with a demand for a preliminary agreement stating that
the terms of the Carnegie-Illinois contract would be in effect
pending results of the election.
This the company refused.
The
local unions then effectively closed down the company’s plants
P
It
1„
Steel Labor, May 1, 1937,
IS
6?
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
for thirty-six hours.
The company, in poor financial position
to withstand a prolonged strike, signed the preliminary agree-
i
[;
ment.
The strikers claimed a complete victory for the SWOC.
The ULRli election was held a few days later and resulted in
I
I
[
$
£
I
I
better than a two-to-one majority vote for the SWOC.
The strike
sentiment had enabled the local unions to get a majority.
The
company signed an agreement recognizing the SWOC as the exclusive oargaining agency for its employees in accordance with the
law as set forth in the National Labor Relations Act.
|
j;
I
Several smaller companies followed the precedent cf Jones
and Laughlin.
Crucible Steel, a large corporation employing
14,000 workers, signed an agreement similar to that cf CarnegieIllinois.
E.
In this way it avoided both a strike and an election.
"Little Steel."
The principal companies which were determined to resist
the SWOC in 1937 were American Rolling Mill, National, Bethlehem
Inland, Republic and Youngstown Sheet and Tube.
Up tc that time
these "little steel" companies had been more prosperous as a
group than the four largest companies which had made contracts
with the SWOC.1
Il
M:
Ifl
ii
From 1954 to 1936 the four largest contract companies, having
about 44 per cent cf the industry’s ingot capacity, had a total
net profit from operations of 95 million dollars, while the
"little steel" group, having less than 40 per cent ingot capa­
city, reported profits of ISO million dollars.
This fact is
partially explained by the greater proportionate output of
"light products" of most cf the "little steel" companies.
m
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
G;.
Although, complying with standards of wages and working
conditions set forth in the Carnegie-Illinois contract, the
"little steel" companies were unwilling to make an agreement
with the SWOC, either oral or written.
In only three of these
companies, however, did the SWOC feel strong enough to force
the issue
—
Inland, Republic, and Youngstown Sheet and Tube.
A strike was called on May 26, 1957, against these three con­
cerns.
Inland and Youngstown Sheet and Tube closed down com­
pletely; Republic attempted operations at several plants.
On
June 10th the Brotherhood of Railroad Trainmen and the Brother­
hood of Locomotive Engineers called a strike of the Bethlehem
Steel railway employees In the vicinity of Johnstown, demanding
a signed contract.
The steel workers of Bethlehem’s Johnstown
plant were drawn in to support the Brotherhoods.
That this
strike was neither planned nor welcomed by the top command of
the SWOC seems evident, for the Johnstown plant was only one
of ten mills operated by the Bethlehem Steel Company.
On June 17th the President appointed a three-man "Federal
Steel Mediation Board" to attempt a settlement of the strike*
I
|
Appearing before the Board, the heads of the four companies in-
|
volved stated that they would make no agreements, oral or written
|
with the SWOC, nor would they meet personally with the top of-
r
ficials of ttj.e CIO to discuss the matter.
■r s
They argued that the
,
L
Wagner Act did not compel an agreement, that a signed contract
|
would eventually lead to a closed shop, and that, in any case,..
I
L
the SWOC was an irresponsible body.
The Board proposed that
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56,
the companies make and sign an agreement with the SWOC, to be­
come effective only if the SV/OC won a NLR5 election.
although
the SV/OC indicated willingness to negotiate on this basis, the
companies refused.
The Federal Steel mediation board, having
failed to effect a settlement, disbanded, censuring the heads
of the companies for refusing to enter
into a "man-to-man"
discussion around the conference table with the CIO leaders,
and for refusing to make an agreement with the SV/OC regardless of the number of employees it actually represented,
The Industrial warfare, which lasted for over a month,
was characterized by outrages by local police, violence by
strikers and vigilante committees, company-inspired back-toP
Ikv
IS'.
work movements, and suppression of civil rights. The strikes
were actually broken as a result of the Intervention of national
m
Guardsmen who limited picketing and gave the necessary protec­
tion for a successful back-to-work movement.
m
The defeat of the
2
strikers was complete except possibly at Inland Steel.
The causes for failure of the strike may be suggested.
In the first place, the SV/OC made a tactical error in calling ..
a strike on such a far-flung front.
M
i
m.
mi
m
i
II
hem plant, moreover, was suicidal.
The stoppage at the Bethle­
Secondly, though perhaps
‘'"Report of Federal Steel Mediation Board to Secretary of Laoor,
Francis Perkins, Julv 2, 1937.
2
The strike was terminated at the Indiana Iiarbor plant of this
company following an agreement made between the company and the
Governor of Indiana providing that the company’s stated labor
policy would be carried out and that any unsettled grievances
relating to such stated policy would be subject to arbitration
hy the Indiana Commissioner of Labor*
04
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
strong as a surging movement, the pro-CIO workers were weak "
as an organization.
Unlike the hardy miners, who had learned
the value of a strong permanent organization, most of the steel
workers were raw recruits, who became restless as the struggle
deepened.
The glorious victories of previous months and the
perhaps exaggerated reports of enthusiasm from the local dis­
tricts misled the SV/OC Into a premature strike.
1
Finally,
the" .
SV/OC underestimated the tremendous financial strength of the
"little steel" companies and their consequent influence and
control in the communities where their mills were located. The
"little steel" strikes were evidence of the futility of a mass
offensive against an alliance of powerfully entrenched economic
interests•
The only course left open immediately after the strikes
was to press charges of unfair labor practices with the NLRB
against the Republic, Inland, Bethlehem, and Youngstown Sheet
and Tube companies, as well as against American Rolling Mill
and National in whose plants the SWOC never had more than a
siiial1 fo 1 low ing ♦
Recession and Revival.
The sharpest and widest drop in steel production ever ex­
perienced by the Industry was recorded in the last four months
of 1937.
By December output was 70 per cent below that of
August, payrolls were cut almost in half, and employment had
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
fallen rapidly."''
revival.
Not until the summer of 1938 was there any
The recession was even a greater blow to the SWOC
than the defeat in "little steel",
discouraged union membership.
widespread unemployment
Dues payments fell off precip­
itously, and some of the lodges in the large mills almost
dwindled away.
Faced with these conditions, the SWOC attempted
to bolster its membership and lodges in the large mills, to ex­
tend organization in the smaller steel concerns and fabricating
11:
I
i;.‘
g
comnanies, and to prevent general wage reductions.
||
is
ers from the payment of dues.
I
In the first place, the SWOC exonerated unemployed workBut that was not all.
Staff or-
jjp
ganizers were ordered to help the local lodges in setting up
If
unemployment and relief committees.
IPs
|§
twofold purpose.
Such committees served a
By registering all unemployed union members
the SWOC was able to use its political and legislative influ­
ence to have them put on VtfPA jobs or relief.
Secondly, by such
a registration, the SWOC was able to insist that the seniority
jjk
provisions of the contracts be enforced both in reduction of
I4
i
i,
forces, and again, when operations picked up, In restoration
of all former employees to their jobs before new employees
f;
p.-,
f
tr!
S&
.
gg
ii.
|
ous times the SWOC was successful In building a spirit of
|__
solidarity and unity among the members which later bore fruit
If
Computed from data supplied by the American Iron and Steel
Institute.
were hired.
By thus demonstrating to the workers that the
union could be of service in depressed as well as in prosper-
f
fe
Eft?
k'
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
in the emergence of a stronger and more loyal organization*
Nevertheless, during this period there was evident a lack of"
interest in the union in some of the U.S. Steel plants, per­
haps because the contracts had been originally "handed to the
workers on a silver platter1'.
During the period of the recession, the SWOC continued
to secure contracts with the smaller steel and fabricating con­
cerns, which in general were easier to organize than the largs-r
steel producers.
Practically all of the previously organized
companies renewed their contracts in 1938, and, in addition,
the SV/OC increased its total number of agreements about 30
per cent.
The number of lodges was correspondingly greater,
and the revenue from new members helped to defray, in part,
18
P
#
if
If
ft
I
I'D
I
M
|1
I
the large overhead costs of the SV/OC.
Prom the SV/OC point of view, the greatest achievement
of the recession period was the preservation of existing wage
rates.
The fate of unionization in the entire industry hinged
on the negotiations for a new contract with U.S. Steel in
1
February, 1938.
In conference with a committee of executives
-
l‘
of U.S. Steel subsidiaries, the SV/OC leaders requested a term
ilK'-
contract of one year, more liberal vacations, and official
recognition by management of dues committeemen.
I
p
If
countered with a demand for a general wage reduction.
SWOC refused.
i|
U.S. Steel
The
The company spokesmen then offered to extend
^The original 1937 agreements were to expire on February 28, 1938.
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the existing contract indefinitely, with a proviso that either
party might give the other ten days' notice for a conference
to change the terms of the agreement, and, if there was failure
to agree within 20 days of such notice, the 1957 agreements
would be terminated.^"
This "escape clause" v/as necessary, U.S.
Steel argued, because of economic conditions which might neces­
I
sitate wage reductions and to safeguard "big steel" in the event
that "little steel" should decide to reduce wages.
cepted this proposal.
The SWOC ac­
The Independent contract companies and
most of the allied steel fabricating and processing companies
?
followed the lead of "big steel".
Knowing that their position
was precarious, the SWOC avoided taking the initiative in open­
ing up existing contracts for changes or revisions, lest the
'£<£
companies would take advantage of such action to institute wage
reductions.
i
ft
s»
In the spring of 1938 U.S. Steel informally asked the
SWOC to take a wage cut because of the competitive situation
in the steel Industry and because of price cuts which were im­
pending.
The SWOC spokesmen refused.
They advised the steel
makers not to cut prices, and hinted that a wage reduction would
result in a strike.
June, 1938.
Nevertheless, price cuts were Instituted in
Officials of "big steel" and the SWOC continued to
discuss wage reductions all through the summer, and at one time
the former were thought ready to invoke the termination clause
of the agreement.
L'
^See
/2.3.
ilS
m
IM
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I?
By November the situation "had eased somewhat," but
U.S. Steel was still trying to persuade the SWOC to acquiesce
in a wage cut because costs were out of line with prices. The
SWOC contended, however, that the industry was able to main­
tain wages at a high level because of the increased productivity
of labor resulting from technological improvements.
By the
spring of 1939 business had so far revived that wage cuts
no longer a vital issue.
were
The SWOC had forestalled general wage
reductions during a major business depression.
The period of revival, begun in the fall of 1938, con­
sm
i
■
83
m
Wt
ill
tinued slowly until the summer of 1939, following which the
"war boom" broke.
Beginning
in January, 1939, the SWOC began
to rebuild its lodges in the large steel mills
(particularly
in the plants of the U.S. Steel), many of which had been reduced
during the recession to skeleton groups of officers and ardent
union men0
Through installation of new officers, establishment
of dues committee systems (not recognized by management), and
organized membership reinstatement drives, many lodges were re­
If
vived and some became stronger than ever before.
Grievances
were pressed with more vigor, and certain concessions in proce­
dure were secured through negotiations with management.
mi!?
Recog­
nizing that little interest could be roused by general lodge
meetings in a, large plant, the SWOC concentrated on organizing
these mills by departments.
m
p
Ci
mi
Wi
It set up, as integral subdivisions
of the lodge, departmental organizations which might hold periodic
t
'"P^.
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meetings to discuss and act on matters of vital concern to
particular groups of workers.*^
The greatest progress was made in the smaller fabricat­
ing and steel companies where management resistance to more
intensive unionization was weakest.
With the aid of membership
certifications and elections by the NLRB, the SWOC was gener­
ally successful in securing exclusive bargaining rights in these
companies.
In the fall of 1939 probably fifty or more of these
concerns, among them several small but well-known steel compan­
ies, had been forced to grant complete recognition either through
informal understandings or outright union shop agreements.^ The
I
'
SWOC was taking advantage of the upward surge of business to
strengthen the position of the union in those companies where
it already had a foothold.
The mammoth taks of unionizing "little steel" still re­
r,.,
i
l#
mained.
El
W
NLRB decisions in the Inland, Bethlehem, and Republic
cases were gratifying.
3
However favorable these cases might
be to the union's position, SWOC leaders were convinced that
"little steel" could be organized only by direct action.
$1
this method they
By
won a "peaceful victory" at Inland Stetji.
Through the selection of competent committeemen and the establishment of an effective dues committeeman system, by the sumgg
mer of 1939 one of the strongest lodges in any major steel
company had been built in Inland’s main plant.
The independent
eg.
MS.
^•See pages
2cf Chapter J X .
3cf Chapter IT,
RrSlSS.
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union, a successor to- the former employee representation plan,
had been eclipsed.
The leaders of this Inland lodge claimed
that relationships with management were in many respects more
satisfactory than those in the neighboring U.S. Steel plants
because there was no contract to limit the scope of collective
bargaining.and therefore no obstacles to prevent strikes if no
satisfactory understandings were reached.
Management was will­
ing to concede informally that the SWOC was the representative
of the majority of workers in the plant.
Although apparently
ET
6
making a determined effort to establish permanent and construe:
|f
tive relations with the union, the company was unwilling to
1
sign a contract until such time as the courts should hand down
IP
g}
a final ruling concerning the decision of the NLRB on this
P
matter.^
m
Ite
m
In several plants of the Republic Steel Corporation and
the Youngstown Sheet and Tube Company the SWOC grievance com­
mittees were meeting regularly with management.
t:
The relation­
ship, in one case, was described as "superior to that existing
ft
in some companies that have made signed contracts".
IS
The SWOC
has been anxious, apparently, to establish de facto collective
bargaining relations wherever possible in the "little steel"
1
companies in order to maintain functioning organizations in as
many plants as possible.
Through such committees, moreover,
it was possible to publicize the complaints of union members.
S?ws:
l?r
m
StS
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In 1939, the main organizing efforts of the SV/OC were
W2
directed at the Bethlehem Steel Company.
Considered the back­
bone of "little steel", Bethlehem is, next to U.S. Steel, the
largest employer In the industry.
Unlike the other "little
steel" companies, Bethlehem had not gone beyond those companies
If
PW
i
which had signed contracts by granting more liberal vacations...
and other concessions through its employee representatives*^
t|
r:
In fact, its common labor rates were lower than those In other
O
large companies.
There was also, apparently, some dissatis-
I
faction among the workers with the system of incentive rates
and bonuses that prevailed In the plants.
I
||
§§&
Logically, there-
fore, the SWOC singled out Bethlehem for a concentrated organization campaign.
The task of organizing the Bethlehem plants has been
gg.;
difficult.
In the first place, employee representation plans,
started as early as 1919, were still in existence.
Secondly,
the SWOC campaign in 1936 and 1937 had not been a success,
partly because of the poor type of organizers placed In charge.
B'Also, to quote an SWOC spokesman, "It is very hard to rebuild
If
It
Wri:
«z
a union on the ashes of previous failure."
Early in 1939 the SWOC appointed a director ana a staff
to head up the new organization campaign in all Bethlehem plants,
This drive marked a new policy of the SWOC in organizing, from
the top down, one company at a time.
A
Ilf
It is notable that the
■^See Chapter 1? ^ 2See
76*
Interview. Jack Lever, Field Director, SWOC.
t
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e.'.'rVr
.
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SWOC, for the first time, set up an organization whose sole
activity was concentrated on the scattered plants of a single
large corporation.
In place of the straggling and, in some
instances, poorly led local lodges, plant organizing committees
were established.
For each department a steward was appointed
whose function has been to enlist his fellow-workers as union
members.
ihe chairmanship of each plant organizing committee
has been rotated periodically in order to give as many stewards
as possible a chance to demonstrate their capability for leader­
ship.
In December, 1939, grievance committees were beginning
to function and an attempt was being made to induce management
to set regular dates for meetings with these committees.
m
IS
Another scheme used by SWOC str' agists in the Bethlehem
campaign has been to enlist the support of "progressive1' em­
ssss ployee representatives. This strategy is the same as that used
m
three years earlier against Carnegie-Iliinois. In August, 1939,
48 representatives from 9 plants met In Pittsburgh and announced
their affiliation with the SWOC.
R
I
With the aid of union leaders,
they also formulated a program to push the organizing campaign
in all Bethlehem mills, with the object of securing a signed
contract which would provide for a ijp5.00 per day minimum common
labor wage and proportionate increases in other classifications.
The company so far has refused to sign a contract with
the SWOC and to discuss collective bargaining relationships on
a corporation-wide basis.
However, in a recent letter to the
SWOC the Director of Industrial Relations reiterated the stated
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
policy of the company that the management representatives at
each
plant were always ready to meet with the S W O C committees-
According to union officers, these management representatives
’
nave been willing to listen to the presentation of individual
grievances, but have refused to discuss the general matters
pertaining to wage rates and union recognition, pointing out
that they have no authority to alter wcomp any policy" on such
questions.
m
It
P
twv
if
I
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V.
THA S,acc AMD GOVbRNkLRT
It is quite reasonable to conclude that there would be
very little labor organization in the steel industry7- today
aere it not for the United Line workers, who possessed the
leadership and financial resources to conduct a large-scale
unionisation drive.
The success of the SYiOC, nevertheless,
is, to a considerable extent, attributable to the existence
of legislation favorable to organized labor, and to the po­
litical power of the CIO*
A.
The National Labor Relations Act.
Resort to the National Labor Relations board has been
an Important part of SWOC strategy7- in three respects: to se­
cure reinstatement and back
w a g e s
for employees who have been
//
discriminated against for union activity, to fight company and
independent unions, and to determine representation to secure
exclusive bargaining rights.
Up to the end of 1939 the Sii'OC
had filed 692 charges of unfair labor practices and 286 re­
quests for majority representation certification with the
PI
If
te
national Labor Relations board.^
Although the employers were inclined to consider the
act unconstitutional in the early stages of the SWOC drive,
H
"their hands w,ere stayed to some extent by the revelations made
2
at the National Labor Relations Board hearings”.
This factor,
^"Interview,
beyer Bernstein, Research Assistant, SYvGC.
p
hurray, Philip, Statement on proposed amendments to the National
Laoor Relations Act. SWCC press release. July 18, 1939, page 5.
w
-
B?
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of course, greatly facilitated the SWOC campaign.
The SWOC
found, furthermore, that filing of charges with the KLRB
might be very effective in securing reinstatement and back
wages for those workers who were not immediately reemployed
following the “little steel" strikes.
In the cases involving the Republic Steel Corporation,
1
the Board found that the underlying cause of the 1S57 strike
was the company’s campaign to crush the union by means of un­
fair labor practices.
It, therefore, ordered the company to
"offer the employees who were laid off, discharged, or refused *
|
reinstatement for their union activity immediate and full re­
instatement to their former or substantially equivalent posi­
tions, without prejudice to their seniority or other rights
or privileges and to pay such employees back pay for losses
suffered by reason of the respondent’s unlawful &cts".^
Within
the next month, the company, upon receipt of applications from
former strikers, reinstated several thousand workers who had
is
been idle since 1937.
In November, 1S39, the U.S. Circuit
Court of Appeals upheld the Board in all substantial particup
lars.
Business had picked up by this time, and the SWOC re­
p.;
ported that the majority of employees had been taken back with
the exception of those which the court specifically exempted
p
I
St
s
®
h-
because of conviction of certain crimes and offenses during
the strike*
National Labor Relations Board, Matter on Republic Steel Cor­
poration. Case No. C-184, October 18, 1938. This case applied
only to plants in Youngstown, Warren, Niles, Cleveland, Canton,
and Massillon. The SWOC has also filed charges concerning other
plants of the corporation.
^U.S. Circuit Court of Appeals, for the Third Circuit, Republic
Steel Corporation vs. National Labor Relations Board. No. 6907,
UoveniDer, 1939*----------
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I
H
The SvifOC also filed charges of unfair labor practices
in connection with the strike In plants of the Youngstown Sheet
and Tube Company.
The union had hoped for settlement of the'
charges directly with the company and requested the KLRB not
to hold a formal hearing until after all avenues of adjustment
had been closed.
Following a series of conferences with the
company in which KLRB representatives took part, the company
called back most of the employees against whom the SWOC had charged discrimination except those who had been convicted of
certain offenses during the strike.
Agreement, however, was
not reached on the larger issues involving relnstatement of all
employees with full rights, compensation for lost wages, dis||
IP
Pi?
|g
establishment of the independent unions, and SWOC recognition.
It was expected, therefore, that a formal complaint against the
company would be issued by the Board.
8
The Issuance of the Board's order in the Republic case
and the charges pending in Youngstown Sheet and Tube were major
factors in the ultimate reinstatement of thousands of employees
Sg
who were not taken back immediately following the strikes of
1937.
By resort to the Board, the SWOC was able to check its
defeat in "little steel” by means of a legal offensive against
the companies.
Should the Supreme Court make a ruling in the
Republic case upholding the opinion of the Circuit Court, the
Republic Steel Corporation and possibly the Y'oungstown Sheet
and Tube Company would be forced to pay back wages amounting
M
probably to several million dollars.
The effect of such a
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decision, moreover, would immeasurably enhance the prestige
of the SWOC and contribute greatly to the building of stronger
union organizations in these and other "little steel" companies.
Of equal importance to the SWOC is the destruction of the
employee representation plans and successor independent unions
in the steel industry.
In the Republic case, the Board held
that the original employee representation plans were imposed
by the company on its employees and, as originally drawn, were
r
i.
5 ■'
incapable of serving as collective bargaining agencies repre­
senting the employees.
The Board ruled that the change of these
plans into independent unions, after the Supreme Court decision
in the Jones and Laughlin case, did not free them from domina­
tion by the company.
The Circuit Court upheld the Board’s order
to disestablish and withdraw recognition from all the employee
associations in the Cleveland, Massillon, Canton, Youngstown,
Warren, and Niles plants.^
The Board also ordered the Inland
Steel Company to ^withdraw all recognition from the Steel Work­
ers Independent Union, Inc., as a representatives of its employees”.
In the case of Bethlehem, the company was ordered
to cease and desist from dominating and interfering with the......
administration of employee representation plans in 10 plants
and to withdraw recognition from such bodies as representatives
EK
P:
of the employees for purposes of collective bargaining.^ Hearings
"“See page £8 above.
^National Labor Relations Board, Matter of Inland Steel Company.
Case No. C-252, November 12, 1938.
^National Labor Relations Board, Matter of Bethlehem Steel Cor­
poration. et.al.. Cases Nos. C-170, R-177, August 14, 1939.
ten.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
were completed in a similar case involving th.e Weirton Steel
Company.
None of these companies, however, had withdrawn
recognition from such employee organizations at the end of
1939, hoping that the courts might not uphold the orders of
the Board in this respect.
Thus the ultimate result of the
legal offensive on the unaffiliated organizations in "little
steel" is still -uncertain.
The SWOC has been more successful in securing immediate
benefit from similar charges against smaller companies.
In
several instances the companies were persuaded to settle these
charges directly with the SWOC to avoid formal complaints and
hearings.
The net result has been that any non-SWOC organiza­
tion that attempts to secure a foothold in a steel plant is
likely to be under suspicion as a company dominated organiza­
tion.
In order to avoid possible trouble, several companies
have taken action to discourage the formation or continued ex||
istence of unaffiliated organizations whether company dominated
f
,
or not.
t
The Board has been of great service to the SiaOC in determining by membership card check or by elections that the union
!_■
represented a majority of the workers in a plant or company.
^
m
The issue of union recognition was settled by NLRB elections
in the Jones and Laughlin, Pittsburgh, and Sharon steel com­
panies in 1937.
In these cases the SWOC received a large
m
fes
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
majority of the votes cast."*"
jf
$
h-
These eiections set a precedent
for the settlement of representation disputes in scores of
smaller steel and fabricating companies.
Up to November, 1959,
the SWOC had participated in 151 elections in which 86,560
votes were cast.
The SWOC won 67 per cent of the elections and
received 64 per cent of the votes.
About 4 per cent of the votes
were cast for A. P. of L. affiliates, 10 per cent for independent
unions, and 22 per cent for no organization, but against the SWOC.
The only major defeat of the SWOC in the steel industry took place
in the Butler plant of the American Rolling Mill Company where the
SWOC won only 402 out of 1,645 votes cast.
In 1938 Philip Murray issued a specific ruling on the mat­
ter of petitions for elections.
BES
Poor judgment had been used up
to that time by some staff representatives in demanding elections
before they were reasonably sure that the majority of employees
could be counted on to support the union.
Henceforth, there were
to be no petitions filed •until at least 51 per cent of the em­
ployees eligible to vote in such elections were signed up members
of the union.
Furthermore, in cases where there was a rival
"company or so-called independent union", the SWOC was to file
charges (provided supporting evidence could be secured) alleging
^The results of these elections were
Jones and Laughlin:
17,208 for
-Pittsburgh Steel:
5,297 for
Sharon Steel:
1,773 for
as follows:
the union,
the union,
the union,
7,207 against
645 against
721 against
Cf. Murray, Philip., Op. cit.. pages 4 and 7.
i||
lis
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that the "independent” union was supported or otherwise dominated
f;
I
f;
jy the company.
until
Ho steps were to be taken towards an election
after the Board nearings on such charges had been completed,
i
IS
fc
more use made of consent elections and membership card checks.
Is
In the first case, the employer agrees to the holding of an
f
election without a formal hearing by the Board.
i
^
as opposition to the union has subsided, there has seen
In the latter,
an agent of the board checks the union membership cards against
the company payroll to determine representation.
.
I*
I-
According to Philip Murray, the SWOC has resorted to the
board "as an alternative to the stoppage of work or as a means
-
f, to facilitate the settlement of an industrial dispute already
I* in progress". 2 Prior to the creation of the HLRB, the union
often had to strike to prove to an employer that a majority of
his workers wanted the union.
In general, if a company refused
| to recognize the union, the SWOC would file charges with the
Board of unfair labor practices and at the same time ask for
certification as exclusive bargaining agency.
The top execu­
tives of the company quite frequently had no idea of the extent
to which their supervisory forces might have violated the Act
until charges were pressed.
If the company merely wanted to
determine whether the union had a majority, it could agree to
a membership card check against payrolls or a consent election
■'•Murray, Philip., Instructions to all sub-regional and field
directors and staff members, May 5, 1938.
^Ibid.. page 2.
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74.
under the auspices of the NLRB.
If not, formal hearings might
oe held and an order issued.
Philip hurray indicated that, with few exceptions, prac­
tically every charge filed with the Board was in effect a sub­
stitute for a strike.^"
Excluding the Republic, Youngstown
Sheet and Tube, Bethlehem and Inland cases which followed rather
than preceded strikes, this statement is probably correct. Never­
theless, it might be added that the SVjCC has pressed charges
against some companies which it had been unable to organize suf­
ficiently to make a strike effective.
The weirtcn (National)
2
and American Rolling Mill Companies are cases in pointThus
the SVi/OC has resorted to the NLRB not only as an alternative
to calling a strike but also as a means of fighting those com­
panies where, either because of failure of an organization drive
or because of anti-union tactics of the employer, the union had
made little he adv/ay.
The importance of resort to the Board as a substitute
for direct organizing, however, must not be overemphasized.
This procedure is of questionable value because of the length
of time required for decisions.
As one SWOC spokesman stated,
"In the early stages, some organizers pressed charges and counted
on the Board's decision to help us build an organization.
Now
we take the; position that building an organization is the first
and primary objective.
We rely on the NLRB only to protect us
^Murray, Philip, Statement on proposed amendments to the National
labor Relations Act.
SWOC press release, July 18, 193S, page 17.
^See page J"7*
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75
in that endeavor."1
In October, 1938, the legal department of
the CIO emphasized that "primary reliance must not be placed
upon the Board for organizing work," and that the Board should
be used as an auxiliary weapon only.
Henchforth, only the
best cases supported by substantial evidence were to be filed.
Furthermore, cases were to be brought against only the more
important employers, in the expectation that, if the dominant
corporations in various industries were brought into line, the
2
smaller employers would give up without a fight.
Again at a
staff meeting in the summer of 1939, the SWOC executives urged
that, since the members of the Board were wavering in the face
SWOC-
of opposition by employers and the a.F. of L . , the unAcn would
have to rely even more on its own efforts to establish unionism
along industrial lines in the steel industry.
The increasing
emphasis in 1939 on direct action in organizing "little steel"
is one manifestation of this changed attitude.
B•
The Walsh-IIealey Act.
The Walsh-Healey Act provides that the Secretary of Labor
may require that prevailing minimum wages be paid on contracts
'Z
over $>10,000 awarded by the Federal Government.
There are
1Interview. Meyer Bernstein, Research Assistant, SWOC.
O
McDonald, Dalvid J., Instructions to all lodges and staff members
of the SWOC, October 5, 1938.
^united States Congress, 74th Congress, An act to provide condi­
tions for the purchase of supplies and the making of contracts
by. the United States. Public No. 846.
This Act provides that in any Federal Government contract ex­
ceeding ^10,000 all persons employed by the manufacturer must be
paid "not less than the minimum wages as determined by the Secre­
tary of Labor to be the prevailing minimum wages for persons em­
ployed on similar work or in the particular or similar Industries
or groups of industries currently operating In the locality in 'which
tae materials, supplies, articles, or equipment are to be manufac­
tured Or fnrn'i shsr! nnrlai’ sflir) r*r>n +-.r»an f.11.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
76.
certain geographical differentials in common labor wage rates
that have become customary in the industry.
The wage in­
creases of 1936 and 1937 established a common labor rate of
62vS- cents per hour in Pittsburgh, Chicago, Youngstown, Canton,
Cleveland, and the Worth Ohio River district.
Through collec­
tive bargaining with the Wheeling Steel Corporation, the pre­
vailing labor rate in the South Ohio River district was raised
to the same level.
In all these regions, therefore, the SWOC
contracts specify the 62-§- cent rate.
In the Eastern district,
which includes such important steel centers as Johnstown and
Bethlehem, Pennsylvania, Sparrows Point, Maryland, and Buffalo,
New York, the prevailing common labor rate Is three to six
cents lower.
Company.
These areas are dominated by the Bethlehem Steel
In signing agreements with the smaller companies in
these regions the SWOC has recognized the lower prevailing
minimum rates.
In the South there are two wage districts.
In Birmingham, Alabama, the common labor rate is 45 cents per
hour and is set forth in the SWOC contract with the Tennessee
Coal, Iron and Railroad Company, a XJ.S. Steel subsidiary.
In
the rest of the South, notably Gadsden, Alabama, where a Re­
public subsidiary is located, the rates range from
5 6
to 40
cents per hour.'1’
Murray, Philip, Statement before the Public Contracts Board
to determine the prevailing minimum wages in the iron and steel
industry, July 25, 1938. (Secured from SWOC files.) The data
given in this statement was checked by figures supplied the
writer by the American Iron and Steel Institute.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
On July 5, 1938, the SWOC requested the Secretary of
Lab o r
to
determine minimum wages In the steel industry pursu­
ant to the provisions of the Walsh-Healey Act.
that there he three prevailing rates.
It suggested
In region number one,
which would include all of the main steel centers in the North
including those in the Eastern district, the rate should be
62^- cents per hour.
The SWOC argued that this area possessed
over 90 per cent of the steel making capacity of the nation,
that competition prevailed among all producers in the area,
that the cost of living was reasonably uniform, that the ma­
jority of common laborers in the area received the 62g- cent
rate, and that the SWOC had contracts with the majority of
companies in the region specifying that rate.
In region num­
ber two, comprising the Western states, which accounted for
less than three per cent of Ingot capacity, the rate 'was to
be 60 cents per hour.
In the entire Southern region, which
was designated as number three, the rate was to be 45 cents
per hour.
The SWOC stated that in recommending the wage dif­
ferentials in these three regions it did not recognize the
desirability of these differentials.
These the union hoped
to eliminate some day through the process of collective bar­
gain! ng.1
The primary purpose of the SWOC was to strike a blow at
the Bethlehem Steel Company which dominates the low wage district
^Murray, Philip., Ibid,
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
in the East and also receives a substantial number of Govern­
ment contracts.
It would be impossible to raise common labor
rates in the union companies in those areas unless Bethlehem
took the lead.
The SWOC was unable to put direct pressure on
Bethlehem so it resorted to pressing for governmental action.
Because nearly all of the labor force in Bethlehem plants is
paid on an incentive rate basis, the company has contended
that very few employees receive "average hourly earnings" of
less than 62^- cents per hour.'1' It is the small steel compan­
ies in the Eastern region which have protested the most. They
have pointed out that an increase In the common labor rate
would stimulate a demand to maintain differentials In the
higher brackets, that their costs would thereby be raised so
as to put them at a competitive disadvantage compared with
larger companies which had better machinery and equipment,
and that freight rates in the Eastern district were higher
on several items than in other regions.2
in short, this ac­
tion of the SWOC, while directed primarily at Bethlehem, would
probably inflict the greatest injury on the smaller companies,
It many of
If
which were under union contracts.
In January, 1939, the Acting Secretary of Labor Issued
|I:S- an official ruling upholding, in general, the contentions of
■^Interview. George Vary, Director of Industrial Relations,
Bethlehem Steel Corporation.
Efe.'
I|p£ 2See: United States Department of Labor, Public Contracts
Board, Report of Proceedings: Prevailing Minimum Wages in
the Iron and Steel Industry. July 26, 1938.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
the SWOC.1
The order has not become effective pending litiga­
tion in the courts.
The SWOC, however, has not been content to rely too
much on this case.
A principal issue in the organization cam­
paign in the Bethlehem plants has been a wage increase that
will bring common labor rates to at least 62# cents per hour.
In other words, the SVifOC has clearly in mind a corresponding
increase in rates above the minimum.
At best, the proceedings
brought under the Walsh-Healey Act have been a temporary and
partial substitute for collective bargaining in the absence of
complete unionization of the steel industry.
C.
Legislative and Political Activity of the SWOC.
The SWOC has centered its activities on the political
front in Labor’s Non-Partisan League.
All lodges have been
asked to take an active and constructive interest in the work
*
of the League."
Mr. Murray has pointed out that the SWOC is
not a political instrument but is concerned primarily with the
direct organization of steel workers for the purpose of collec­
tive bargaining.
"But through the very nature of Its economic
activity, the SWOC cannot ignore political action," he said.
"Labor must place in office m e n who see human rights as tran­
scending property rights.
It must obtain progressive government
-*-The rate of 62# cents was applied to what the SWOC had desig­
nated as region number one, and the 45 cent rate was set for
the South. Slight differentials from the higher rate were al­
lowed in the three Western districts. For discussion of this
order see: Strackbein, O.R., The Prevailing Minimum Wage Stand­
ard, Washington. 1939, pages 135-146•
J|j % t e e l Workers Organizing Committee, Reports of Officers to the
gl »aze and Policy Convention in Pittsburgh, December 14, 15, 16,
jj§ 1957, pages 17-20.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
through election, of public officials who are in accord with,
the times."^
mm.
?
f
In 1936 the SWOC campaigned vigorously for the re-election of President Roosevelt.
p
In 1937 activity was concentrated
on municipal elections in the steel towns.of Pennsylvania and
Ohio.
The CIO vote was responsible for the election of 17
mayors and burgesses in Western Pennsylvania,
"most of them
active members of SWOC and CIO unions, and others outspoken
advocates of (labor’s) cause".
|| won other municipal positions.
In addition 44 more union men
In Ohio the SWOC claimed credit
for the election of one mayor and 18 union members to other
civic offices.
The most notable achievements were in the
sI steel towns of Duquesne, Clairton, Aliquippa, Midland, and
ES
A
Arabridge, Pennsylvania." In 1939 the CIO strengthened its
f§
political position in several communities and secured m a ­
jority control of the borough councils of Aliquippa, and Mid­
land.
m
te
The local political victories in these towns which were
formerly dominated by the steel corporations is an indication
I©
f.
of the strength and influence of the SWOC.
From the standpoint
of collective bargaining, the main advantage of political in­
fluence in these communities is the control of the police force
t
J#:
S'
sSr
e|
•^Steel Labor. October 29, 1939.
See page 2^ above.
''Steel 'Workers Organizing Committee, Op. cit. , page 20,
^Steel Labor, November 19, 1937.
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81,
in the event of a strike.
In Midland, and Aliquippa the 5v<CC
will be in a position to appoint the police force when the new
ccuncilmen take office in 1940.^
In such cases, bargaining
power is greatly enhanced through political control.
The po­
sition of management in the so-called company towns, therefore,
is apt to be most precarious.
A complete analysis of the political influence of the
CIO in national affairs Is beyond the scope of this paper. It
is important to note, however, that CIO leaders in June, 1938,
put pressure on Washington to delay a monopoly investigation
of the steel industry at a time when increased competition might
have resulted in a move to cut wages.
In October, 1938, Mr.
Murray indicated that the government should offer its aid and
cooperation to eliminate "the terror-stricken condition of the
steel Industry brought about by a system of cutthroat competi­
tion and resulting destroyed earnings".
He went on to say,
"If the steel corporations cannot put their own house in order,
it is the avowed purpose of the organized steel workers of this
nation to promote a constructive legislative program that will
adequately protect the Industry and its workers."^ It has not
been uncommon in the last two years for executives of the smaller
%
steel companies to meet quietly with SWOC officials to discuss a
m?: —
--------- — -1In Midland the Pittsburgh Crucible Steel Company Is the principal
I
employer. In Aliquippa is located-one of the two plants of the
E/ Jones and Laughlin Steel Corporation.
R, ^Statement of Philip Murray, in Cleveland, October 13, 1938.
m i
SWOC Press
Release.
1
fit
gjrttk:':
*
■
■ Bl
hip •
1SS:
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
solution of this "mutual problem".
In the absence of Indus­
try-wide collective bargaining which, might result in some
i
degree of stabilization, the objective of the SWOC, apparently,
has been to exei’t political pressure to prevent price cutting
which, in turn might result in a general reduction of wages.
Of greatest concern to the SWOC is the problem of unem­
ployment.
Cyclical unemployment is a nation-wide rather than
an industry-wide problem.
Technological unemployment, on the
.other hand, is an industry problem.
The installation of con­
tinuous strip mills and several other technological and organ­
izational improvements have displaced thousands of workers in
the past few years.^
mi
E
In 1937 the SY/OC recommended that Con­
gress make a thoroughgoing investigation of the curtailment
2
of job opportunities in specific industries.
In 1939 Mr.
Murray suggested that an unemployment conference of labor,
government, and business representatives migjat solve the u n ­
employment problem "either through a collective agreement be­
tween these three groups to put people back to work, or by a
r
coordinated legislative program to be presented at the recon­
vened session of Congress this winter".
In short, he proposed
to "carry collective bargaining Into the wider field" of na­
i!
tional problems.^
Mr. Murray declared that a main reason for
widespread unemployment in the steel industry was technological
§1
ife-
■^See Chapter I.
2~,
Steel Workers Organizing Committee, O p . cit., page 16.
^Steel Labor, August 25, 1939.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
improvements.
In referring to the newest strip mill of the
Carnegie-Illinois Steel Corporation, he explained, "I have
no particular grudge against the U.S. Steel Corporation at
this particular time, but I would like the U.S. Steel Cor­
poration to explain around the conference table just what
they Intend doing with the thousands of men they have thrown
out on the streets through this new mill."^
In other words,
the ShOC has taken the position that, at least for the present,
unemployment in general and technological displacement in par­
ticular lie beyond the scope of direct collective bargaining
in a single Industry and therefore must be attacked through
Ip
some sort of action sponsored by the government*
It
iS
|§
g,
Steel Labor. August 25, 1939. By the term "conference table"
hr. Murray meant a national conference of labor, government,
and industrial representatives, and not a conference with U.S
Steel executives.
ilfi
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
V I.
h
STRUCTURE
AND
A i.M S
OF
THE
SW OC
. The International Organization.
The agreement between the CIO and the Amalgamated Asso­
ciation of Iron, Steel and Tin Workers set forth the powers
that were to he assumed by the Steel Workers Organizing Com­
mittee.^
In short, this agreement made it possible for the
CIO to take the task of unionization of unorganized steel
workers cut of the hands of the officers of the Amalgamated
without the stigma of a jurisdictional dispute.
Mr. John L.
Lewis was empowered to designate a policy committee whose
function should be to direct an organizing campaign with ex­
clusive authority to deal with the steel companies to reach
agreements.
The termination of the organizing campaign and
the disbanding of the committee are within the province of
the SWOC and the CIO acting jointly.
Philip Murray was designated as Chairman and David J.
McDonald as Secretary-Treasurer of the SWOC.^ Other members
of the policy committee included two representatives of the
Amalgamated Association of Iron, Steel and Tin Workers, one
representative each from the Amalgamated Clothing Workers,
Steel Workers Organizing Committee, Reports of Officers to
the Wage and Policy Convention in Pittsburgh, December 14, 15,
16, 1937, pages 5-6. The text of this agreement appears in
^Appendix "A"
2
Mr. Murray.is Vice-President of the united Mine Workers.
Mr. McDonald has also been associated with-that organization.
-
i?
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
the International Ladies’ Garment Workers, and t’
a e United mine
Workers, the Executive Director of the CIO, and five other
appointees who were executives of the SWOC staff.'*'
In practice, however, policies have probably been deter­
mined by Philip Murray with the advice of his close associates
in the SWOC and the CIO rather than by this policy committee
acting as a formal body.
At the outset most of the organizing
staff was recruited from the ranks of the United Mine ’Workers.
That organization provided an initial $25,000 to establish the
SWOC.
Prom time to time, as necessary, the Secretary-T'reasurer
borrowed additional funds from the United Mine Workers and from
the CIO.
|
Bp
It may be assumed that practically all of the funds
advanced by the CIO were supplied in the first instance by the
Miners.
Ttie total amount of money borrowed by the SWOC probably
exceeds a million and a half dollars.
Although the SWOC has been
self-supporting since the period of the little steel strikes, the
salaries of the Chairman, the Secretary-Treasurer, two regional
directors, and six other executive organizers have been paid by
the United Mine Workers.
Since the SWOC was originally financed
by the Miners and since most of the principal officers have come
from their organization, the steel workers’union might loosely
be described as a subsidiary of the United Mine ‘
W orkers.
More
precisely, perhaps, the SWOC is a provisional administrative
organization for an industrial union of steel workers which is
■^Steel Workers Organizing Committee, Op. cit. , page 6®
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
still in the making.
As such it conforms rather closely to
the organizational pattern and outlook of the United i.iine Workers.
As Chairman, Mr. Murray has been charged with the respon­
sibility of directing the activities of the SVJOC.
The other in­
ternational officer is the Secretary-Treasurer who supervises
the collection and disbursement of funds, the establishment of
lodges, and the auditing of local accounts.
In addition, the
Secretary-Treasurer acts as assistant to the Chairman in co­
ordinating the activities of the entire organization.
The Di­
rector of the Northeastern Region has, furthermore, wielded
much influence in the organization as a whole.
For purposes of organization and administration the steel
centers of the United States have been grouped into three regions,
each in charge of a Regional Director who reports to the Chairman.
Under each Regional Director there are numerous sub-regional or
field directors who supervise the work of organizers or "staff
representatives" in each of the several important steel pro­
ducing districts.-*-
Together with the Chairman and the Secretary-
Treasurer, the Regional directors, sub-regional directors, and
■*-In the United States there are the following regions, each in
charge of a director: 1. The Northeastern covering New England,
the Middle Atlantic States, Maryland, West Virginia, and Ohio
(excepting the Lake Cities), with 40 SWOC offices under the supervision of 26 sub-regional directors.
In this region is produced
about two-thirds of the industry’s ingot steel.
2. The ChicagoSreat Lakes Region with 26 SWOC offices under 12 district directors,
covering the steel centres in and about Chicago, Cleveland, Detroit,
Indianapolis, St. Louis, Duluth, the 'Western States, and the Pacific
Coast. 3. The Southern Region covering Chattanooga, Nashville, and
Birmingham with 3 offices and 2 district directors. A fourth region
is in Canada, with offices in Hamilton, Toronto, and Nova Scotia.
■ i-’suh*
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
organizers constitute the administrative cr "line" organiza­
tion of the SWOC.
In addition, there is a "staff" organiza­
tion, consisting of the accounting and auditing, publicity
and research departments.
The SWOC has no separate legal de­
partment, this function being assumed by the General Counsel
&
0cii of the CIO. The two largest regional offices have small staff
HI) organizations of their own. As of January, 1940, there was a
total of 248 persons employed by the SWOC international organization.'1
The operating expenses of the SWOC amount to about
|
$90,000 a month. 2
Originally financed by outside funds, the
SWOC has been supported in recent years by steel workers’ dues,
rL
75 per cent of which are retained by the international organ­
ization and 25 per cent returned to the local lodges.
The rea­
sons for retention of such a large percentage of dues by the
SWOC international office are not hard to find.
The executives
of the SWOC feel that they are better able than lodge officers
I
to determine the long-range objectives of the organization^and
in order to attain such objectives experienced organizers and
competent legal talent are needed.
These are expensive. Secondly
the SWOC is heavily in debt tc the United Mine Workers and the
CIO for the financing of the early organization campaign. Finally
centralized purchasing, accounting, and auditing make for economy
II
p-
interview. David J. McDonald, Secretary-Treasurer, SWOC.
o
Interview. David J. McDonald.
''Dues are $1.00 per month for each member.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
and more careful guardijpgjship of the funds collecte d»
As
pointed out by the Secretary-Treasurer of the SWOC, "The
history of the United Mine Workers has illustrated the neces­
sity for centralized control.... Take away centralized control
and the steel workers’ organization would disintegrate; take
1
away the dues and it would collapse."'*'
The SWOC pays to the CIO the regular monthly per capita
tax of five cents for every member.
Because of the large bor­
rowings from the CIO, the SWOC is under special obligation to
send a monthly financial statement to the Chairman, Secretary,
and Director of the CIO.
Provision has also been made for
quarterly audits of the accounts of the SwQC by the CIO. There­
fore, not only are the lodges subject to financial control of
the international office of the SWOC, but also the SWOC itself
o
is under the nominal financial control of the CIO. Such a re­
lationship is not often found in American labor unions.
■^David J. McDonald, in a speech delivered at the SWOC training
camp, July 7, 1939.
^Steel Workers Organizing Committee, Reports of Officers to the
Wage and Policy Convention in Pittsburgh, December 14, 15,. 16,
1937, pages 25 and 26. The complete text of the financial policy
follows:
"The Chairman and the Secretary-Treasurer of the Steel Workers
Organizing Committee, from time to time, shall request the Chair­
man and Director of the Committee for Industrial Organization to
obtain funds from its member organizations for the conduct of the
campaign. Such funds shall be remitted to the Secretary-Treasurer
-of the Steel'Workers Organizing Committee for deposit In its account
"Audits of the accounts of the Steel Workers Organizing Committee
shall be made quarterly by the Committee for Industrial Organization
"The Secretary-Treasurer of the Steel 'Workers Organizing Committee
shall send a monthly financial statement to the Chairman, Secretary,
and Director of the Committee for Industrial Organization.
"Bills for ordinary organizing expenses shall be approved by the
Regional Directors and sent to the Secretary-Treasurer for payment.
k
...
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Corresponding to financial control within the
SWOC,
Id
there is centralized administrative control.
I
the large steel corporations have been negotiated by the execu-
L
F
tives of the SWOC with relatively little assistance or advice
from the local lodge leaders.
Contracts with
In some cases the international
officers have had the same authority in negotiating supple­
mentary agreements and informal understandings interpreting
the main provisions of the contracts.^"
The agreements with
the smaller steel and fabricating companies have been negotiated,
for the most part, by the sub-regional directors and their staffs
in company with committees of local lodge officers.
In every
case, the proposed contract must have the approval of the Inter­
national office, of the SWOC before It is effective.
'Within the
last year, however, the lodge officers have participated to a
greater extent in the negotiation of contracts.
Possibly the most important responsibility of the sub­
regional directors of the SWOC is that of "servicing" the various
'^Requests for funds for extraordinary expenses may be made by
a Regional Director to the Secretary-Treasurer, who shall con­
sult with the Chairman of the Steel Workers Organizing Committee
and upon his approval make proper disposition.
"All local field workers of the Steel Workers Organizing Com­
mittee shall submit all bills contracted ana tneir expense and
salary accounts to the Regional or Sub-Regional Directors for
approval, and in turn they shall be sent to the SecretaryTreasurer for payment."
1-,
T~
See Chapter'll- . One exception, In this respect, is the inter­
pretation of the seniority clauses which is usually a matter for
local agreement.
s_
fed
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
The suo-regional directors are expected to attend
lodges.
lodge
meetings, assist the local officers in the conduct of
their unions, coach the grievance committees, and supervise
membership drives and dues drives.
!<•
In the larger sub-regions,
district conferences of lodge officers and grievance committee­
men are held at periodic intervals.
sub-regional
related
directors explain the
At such conferences the
SWGC
policy and program as
to the practical problems of the moment.
As one di-
f'""'
rector explained, "Leaders are developed by coping with each
j,
situation as It arises.
We miners have had years of experi­
ence in collective bargaining and are, therefore, in a posi­
tion to show the steel -workers how to build a strong labor
organization.,l^When the lodges were first formed, the SWOC staff repre­
sentatives exerted a great deal of influence on the election of
the principal lodge officers.
In some cases such officers were
practically appointed by the SWOC district director; in others,
"uncooperative" officers were removed by the SaVOC staff.
In
many instances, the staff representatives picked out a promis­
ing leader, worked along with him, encouraged him to speak in
meetings, and thus made him the naturally recognized leader in
a group.
m
In this respect, the comments of district directors
are significant;
"I have found that in most cases you must ap­
point the local officers. If a man won’t assume
Us
■^interview. Nicholas Fontecchio, District Director, SWOC.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
responsibility, and won’t work under the con­
tract, you raust replace him. The rank-and-file
will always back you up on this.”
"In the early stages of organization, you
have got to develop local leadership. how if
you left It to the members of the lodge, they
wouldn’t elect competent men; they 'would elect
their friends. Therefore, in my area I prac­
tically appointed many of the key officers."!
Although the SWOC staff representatives appointed very few
J_U Ct_L J-'f0,'U.Ci O J.11 _I_
1 —
.n”!
”1 ■
—,»-»
a v»
-S v-»
able pressure "to
T O
O
^ UUOJ IVQi O V^U-UOil
V*»
tt inr /-\ ■V»,
—v
•£* ^
o
_i.O O
.-v
4“ r-.
O'
^
secure the election of officers
opinion were best qualified
U OUliO -i_O.O -t
/
-
»
v»
—
who
intheir
to assume responsibility.
Within the SWOC administrative organization the degree
of centralization of authority varies.
In the Northeastern
■
p
&M Region, the sub-regions are small, and the sub-regional direc­
IB
tors and their staffs are closely supervised by the Regional
Director, who devotes his full time to the SWOC. At the same
P
time an effort has been made to give steel workers a chance to
develop their own program and outlook without following the
Mine Workers’ pattern too closely.
Several organizers and a
few sub-regional directors have been recruited from the ranks
of steel workers.
The Director of the Chicago-Great Lakes Re­
gion, who is active in several other unions In addition to the
Interview., Names are confidential.
2
The Director of the Northeastern Region did not come from the
Miners’ organization. His past experience includes service
with several different unions and the National Labor Relations
Board.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
SWOC, has delegated more authority to his subordinate district
r|
directors, nearly all of whom are former associates in the
f
i,liners’ union.
In this region, the administration of the SWOC
is quite similar to that of the district organizations of the
United Mine 'Workers.
In several instances, however, steel
workers have been given positions as organizers.
In summary, the directing heads and administrative staff
of the SWOC have been appointed by "outsiders” rather than
elected by steel workers.
Few steel workers hold high offices
in the organization, nor have major policies been determined
by representatives of the rank-and-file.
Up to 1939 no con­
vention had been held to adopt a constitution for an industrial
union of steel workers.
|
ass
HP
This provisional administration, how­
ever, has had the formal sanction and wholehearted support of
the rank-and-file union members.
At the "Wage and Policy Con­
vention" in 1937 delegates from the newly formed lodges gave
their approval to actions taken by the SWOC up to that time,
adopted rules and methods of procedure to govern the lodges,
and requested the officers of the SWOC to continue to act as
the collective bargaining agent for organized steel workers.
1
Much of the success of the S'WOC is attributable to its efficiency
as a centralized and well-led organization.
r
"Hvage and Policy Convention, Proceedings. December 14, 15, 16,
1937.
iHi?"
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
93.
o, The Lodges .
3y the end of 1939 the SWOC had established approximately
1,000 active lodges.
The affairs of these lodges are adminis­
tered by about 10,000 local officers and 5,000 to 6,000 griev­
ance committeemen.^"
Although they formally received charters
from the Amalgamated Association of Iron, Steel and Tin 'Workers,
the lodges were governed by edict of the SWOC executives until
December, 1937.
At the "Wage and Policy Convention" delegates
from the lodges formally adopted rules and regulations for their
o
conduct.*"
The principal lodge officers are the President and the
Financial Secretary.
The latter is in many cases a full time
eraployee of the union paid by the lodge.
£
He has charge of dues
collections and is responsible for the accounting of lodge funds,
In addition, each lodge elects a grievance committee composed
usually of from three to ten members.
It Is common for the
President to assume the chairmanship of this committee.
The
grievance committee is sometimes responsible to an executive
board made up of the principal lodge officers.
Most lodges
also appoint dues committeemen, one for every 25 to 50 employ­
ees, to contact the various members of the organization both
on and off plant property.
The main function of these latter
■'•interview. David J. McDonald, Secretary-Treasurer, SWOC.
2Steel
i
‘
Workers Organizing Committee, Rules and Methods of Pro­
cedure for Lodges. December IS, 1937.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
at/pointees
is
to collect dues.
I
grievances,
:
grievance committee.
They
but they often report
have
no powers to settle
to the lodge or the
them
Lodge officers and grievance committeemen are elected
at the last meeting in June of each year by a majority vote of
the members present.
lio person is eligible to act as an of­
ficer or grievance committeeman unless employed in or around a
\
m
mill or factory or by the SWOC.
at least once a month.
Lodge meetings are to be held
No strikes may be called without the
approval of the international officers of the S'WOC.^"
Initiation fees are $3.00 and dues $1.00 per month per
member.
Any member in arrears in dues payments for three months
forfeits membership and can be reinstated only upon payment of
another fee.
In practice, one or two lodges have charged re-
« I instatement fees as high as $25.00.
a
Others refuse to reinstate
former member unless back dues are paid from the date of his
first joining.
One or two lodges have imposed heavy reinstate­
ment fees of this kind, without the sanction or
previous
knowledge of the SWOC executives, in order to impress upon
workers that union membership is a permanent obligation. The
purpose is to prevent employees from joining the union and pay­
ing dues for a few months, while the grievance committee takes
up their cases, and then dropping out.
The total amount of dues and initiation fees collected
by each lodge is deposited in a local bank as a trust fund held
^Steel Workers Organizing Committee, Op. cit. pages 4, 3=
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
for the SWOC.
Within fifteen days the lodge officers must
forward to the Secretary-Treasurer of the SWOC the full amount
of such dues and initiation fees collected.
The Secretary-
Treasurer, upon receipt of these funds, remits to the lodge a
per capita refund of 25 per cent of total dues and 33-1/3 per
cent of the amount of initiation fees.
Should any lodge fail
to report and remit dues and fees to the Secretary-Treasurer
L
of the SWOC. It can be suspended
on ten davs'
notice.
—
V
It is
provided, however, that individual members who have not worked
5 days in any one month may be exonerated from payment of dues.
A11 members so exonerated must be reported to the SecretaryTreasurer of the SWOC.^
The method of collection of dues varies.
At first mem­
bers were asked to come to the lodge office or local SWOC head­
quarters to pay dues.
ifpk’
Such a procedure is inconvenient if head
quarters are located at some distance from the plant.
To an In
creasing extent, therefore, dues are collected by the dues com­
mitteemen who are responsible for contacting a prescribed group
of .members each month.
In the summer of 1939 a stamp system
for dues collection was established.
Under this system the
Secretary-Treasurer of the SWOC sends each lodge Financial
Secretary a dues book for every active member.
These books
are distributed b y the dues committeemen to the members.
Each
month, usually on the first pay day, the dues committeemen
iff!
^Steel Workers Organizing Committee, Cp. cit.,pages 5-7,
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
collect f r o m
the members and. take from each, his dues book.
IT
These books are then turned over to the Financial Secretary
ft
who issues to the dues committeemen enough stamps for the books
collected.
The books are then returned to the members with can­
celled stamps indicating the dues payment for each month.'1’
Although refunds on initiation fees and proceeds of social
activities may bring in some revenue, the money at the disposal
of the lodges is derived mostly from the per capita refund from
the international organization of 25 cents per month per member.
Thus the treasuries of the lodges are limited.
Expenditures
include rent of a hall, salaries of clerical help, and payment
of grievance committeemen for time spent on union business. The
larger lodges may employ financial secretaries, general griev­
ance committeemen or business agents on a full-time basis. In
such cases the SWOC. international office has, on occasions,
paid part of the salaries of such persons.
It is safe to con­
clude that the lodges use practically all of their meagre funds
for current operating expenses.
Y/ith a demand for more local
autonomy, therefore, it is probable that there will be
con­
siderable agitation for retention of a greater percentage of
dues collections by the lodges.
Attendance at lodge meetings, particularly in large
plants, has -been disappointing in some cases.
Since there are
h
three shifts in most plants, it is impossible for all employees
L
- ______________________
it
!%
^Steel Workers Organizing Committee, Instructions — Books,
Records and Reports for Individual Lodges, etc., August 1, 1939,
L‘ pages 7, 19-23, 24-26.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
to attend a meeting at the sains time.
Steel workers, further­
more, appear to have very little interest in a lodge meeting
which must, of necessity, be concerned with the reading of
financial reports or general discussion of relations with man­
agement.
It Is not surprising, therefore, that, In the case of
larger plants, there has been a tendency toward subdividing the
lodge into departmental groups.
It was generally agreed by those
interviewed that.a large plant should be organized department by
department.
As far as possible the SWOC has sought to parallel
the organization of management —
one dues committeeman for every
foreman, one chief steward and possibly a grievance committeeman
| for each superintendent.
In this way the lodge has a permanent
group of "watch dogs", and the workers are continually reminded
of the existence of the union.
Through departmental organization,
furthermore, greater pressure can be put on non-union workers to
bee ome m emb er s .
The following procedure has been adopted by one very large
lodge.
The plant Is divided into 10 divisions, each comprising a
single department or group of related departments.
Elected of­
ficers of each division are the Chairman, Vice-Chairman, Secre­
tary, and Grievance Committeeman, all of whom serve on the gen­
eral executive committee of the lodge. At least tv/ice a month
the membership of each division meets to discuss grievances,
methods of building up a stronger organization, and other matters
pertaining to the mutual welfare of the division.
In each divi­
sion at least one dues committeeman is appointed for every 50
IP
m
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
slant workers; his duty is to collect dues in the plant and
to infcrr.t members in his department of the proper procedure to
te
follow in settling grievances,
although dues committeemen have
no authority to take up grievances with management, they are
[f-
instructed to keep an eye on foremen and supervisors, and to
I
pf
report grievances to the divisional committeeman. T
1|
^
departmental organizations within the lodges have been
set up in response to the particular interests of different
groups of workers.
For example, open hearth employees have
j§
problems differing from those of the employees of a wire mill.
I'.t
an industrial union must recognize such differences, a.t the
same time integrating all groups into the organization for the
plant as a whole.
In the steel industry, departmental ties
among workers seem to be stronger than craft ties.
There are
exceptions to this statement in the case of plant railroad em­
ployees and some maintenance workers.
m
On the ’whole, however,
there appeared to be very little craft organization among steel
workers.
In a few Instances, however, better-paid and more
highly skilled workmen refused to join the SWOC.
It Is pos-
sible, therefore, that such groups might set up some form of
craft organization in the future, particularly if the SYvOC
r
membership should become too closely identified with unskilled
and s era! -skilled employe es .
IP
iiS
^"Rules of Order ana Business," Rubicon Dodge, Ho. 1014, Gary,
Indiana.
sfe
It
fifes*.
R eproduced with permission o f the copyright owner. Further reproduction prohibited without permission.
The newly organized lodges in the steel industry might
be descrioed as "not-house plants".
gressive and militant leadership.
Some have developed ag­
Others must still be built
up with constant supervision of the S'WOC staff.
By 1939 the
lodges, in general, elected their own officers, with varying
degrees of influence by SWOC staff members.
The local officers,
however, were beginning to assume more responsibility in the day-
i­
ll
to-day relations with management.
They were, of course, entire­
ly responsible for taking up grievances.
Among many executives
j|rf of the SWOC, there was a growing conviction that more responm
t
sibility should be placed gradually upon the shoulders of the
lodge officers if the proper type of leadership among steel
workers was to be developed.
C.
Objectives of the SWOC.
■
as stated by Chairman Philip hurray, the main objective
of the SWOC has been to carry into effect the right of collec­
tive bargaining which steel workers have under the lav/, and to
establish a permanent industrial organisation of workers in the
iron and steel industry for the exercise of that right
Liore
specifically, the ultimate goal has been to establish collec­
tive bargaining on an industry-wide basis between a steel workers’
union and an organization composed of the principal steel prog- ducers.
The miners always had in mind a grandiose "Appalachian
agreement" for the iron and steel industry, and they originally
1cf. Steel Labor, August 20, 1936,
gssi
ISI
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
set out tc build a strong industrial labor organisation to
natch the amassed strength represented by the American Iron
and. Steel Institute.
In two respects the original objective was later modi­
fied.
First came the extension of unionization activities to
steel processing and fabricating companies,
having at the out­
set organized such companies "by accident" and only In response
to requests of their employees, the SWOC has devoted more at­
tention to them as time went on.
These companies, located near
large steel centres, are too small for strong resistance to
unions, and are consequently relatively easy to organize.
Also,
the SYvOC leaders were quick to recognize the strategic advan­
it£ tages in organizing certain steel consumer groups.
0
Added dues
have helped to pay overhead costs, and the potential member[ ship has been increased from half a million steel workers to
i probably a million factory employees.
Ife
The other Important deviation from the original course
came as a result of the Taylor-Lewis agreement.
Industry-wide
collective bargaining was abandoned temporarily, and dealing
with independents individually in attempts to secure their
signatures to a "standard contract" was substituted.
fe-
Until
"little steel" should be under contract, there could be no
hope of bargaining with an employers’ organization represent­
ing the industry.
In addition to the conquest of "little steel", the S/JOC
leaders have been faced -with three Immediate problems: solicita­
tion of members in the lodges of the contract companies, collec-
y*'•
e-jr
l/0[
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
tion of dues,, and development of competent leaders from the
ranks of steel workers=
oteel workers, in most cases, have not organized spon­
taneously.
In spite of concessions won for the whole plant by
the union, many workers are indifferent toward organization and
night prefer to remain non-union.
Others might vote for the
SWOC In NLRB elections hut would not thereby become active union
members.
Of necessity, therefore, in order to build 100 per cent
lodges the SWOC has sought management cooperation either through
preferential treatment of union members or through the union shop.
The union shop, or its equivalent, has been the most important
feSjri
immediate objective of the SWOC.
"As collective bargaining de­
velops," said an S W O C 'executive, "there must be a more coopera­
tive attitude on the part of employers, and they should be will­
ing to Insure the responsibility and discipline of the union by
m
giving it complete recognition."2
Many steel workers do not have an Impelling desire to pay
dues.
In some cases, the union has formed picket lines to col­
lect dues as the workers approached the mill gates.
This prac­
tice, annoying to workers and objectionable to management, has
been abandoned wherever possible In favor of collections within
the plant by dues committeemen.
Sometimes, the employer has co­
operated by reminding union members of their "moral obligation"
U
■^Under a "union shop", as the term Is used in this study, mem­
bership in the union would be a condition of employment once a
worker was hired by the company.
^Interview.
Clinton S. Golden.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
to support their organization.
Finally, the SVvGC has re­
quested the simplest and most effective means of dues collec­
tion, namely, that employers check off dues as a demonstration
of their good faith and of their desire to cooperate with the
union.
The "check-off”, however, has not been considered as
essential as the union shop in the minds of SWOC officials
A
major task has been the development of competent
leadership.
Executives of the SWOC interviewed felt that it
would take years to fill the "leadership vacuum" left by a
background of anti-unionism and company-controlled employee
representation plans.
As one sub-regional director pointed
out, "Outsiders cannot run the steel union forever.
Some day
the miners must step out of the picture, and, consequently,
responsible, effective leadership must be developed among
2
steel workers."
The building of an industrial union on the basis of
i
peaceful acceptance of collective bargaining calls for the
training of "administrators" rather than "agitators".
Al­
though the "military type" of union leader has been useful to
the SWOC for certain situations, in the long run the "negoti­
ator type" appears to have built the most stable lodges.
As
one SWOC executive pointed out,"Agitation may create excite­
ment, but only education can build a u n i o n . T h e Miners, with
"''See Chapter J X •
q_
_
interview. Joseph J. T'imko, Sub-Regional id rector, SWOC.
^Interview. Harold J. Ruttenberg, Research director, SWOC,
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
ye&rs of experience in collective bargaining, train the lodge
leaders under their jurisdiction by helping then to cope with,
b.;-:
I
P'-
each situation as it arises.
The Northeastern Regional Direc­
tor has experimented with summer training camps for lodge offi­
cers, which went beyond the discussion of immediate problems
and touched upon the broader aims of the labor movement, the
history of collective bargaining, as well as political and eco­
nomic theories.
Most SWOC leaders, it appears, feel that man­
agement conduct, at all levels, has an influence upon the
leadership that develops in a union.
They say that an antag­
onistic management strengthens agitators, while a cooperative
attitude encourages more sensible and responsible persons to
assume lead.ersh.ip.
"A serious obstacle to the development Of
better union leaders," said an SWOC official, "is the lack of
proper training by management of its own rank-and-file."1
Al­
though by the end of 1939 relatively few steel workers had
filled places of higher responsibility in the organization,
SWOC executives felt that their program was well suited to
find and train the proper kind of leadership in steel.
Some
CIO leaders in the other unions, however, pointed out that
perhaps the "hot-house bred" local officers of SWOC lodges
lacked initiative and militancy.
b.
The Strength of the SWOC.
At the end of 1959 the SWOC had about 1,000 active lodges
and over 600 contracts with employers.
Of these contracts about
S '.-
^Interview.
Clinton S. Golden.
fSS
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
104.
f;
ii
70 v/ere with, companies in the basic iron and. steel industry.
These 70 companies normally employ close to 300,000 wage earners
or between 60 and 65 per cent of the nation’s steel workers. Another 200,000 workers are normally employed by the various
steel fabricating and processing companies that have contracts
with the SWOC.1
The SWOC has claimed about 550,000 members.
This figure
represents the number of workers who have actually signed mem­
bership application cards at one time or another since the drive
started in 1956.
The peak number of dues-paying members has
probably not exceeded 200,000, and the average number of duespaying members is probably smaller.
About two-fifths of the
membership is in the fabricating and processing industries.
Therefore, the total membership in the basic steel industry
to 350,000,
might be set at 300,000/exclusive of employees in the fabri­
cating industries.
The average dues-paying membership in steel
might be about 100,000.
For such a new union, this membership
is rather large.
The small number of dues-paying members, however, gives
a false impression of the strength and influence of the SWOC.
Second to the United Mine Workers and possibly the A m a l g amated
Clothing 'Workers the SWOC is probably the largest labor organ­
ization in the CIO from the standpoint of staff members, local
officers, and number and size of companies under contract.
Its
Calculated by the writer from figures published, in Steel Labor.
June 23,. 1939.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
influence on management policy th.rough.out the industry is very
^reat.^
It Is the basis of bargaining power not only of em­
ployees in those companies which have SWOC contracts but also
of other steel workers who deal with management through unaf2
filiated organizations. In the second place, as pointed out
in the previous chapter, the SWOC and the CIO have consider­
able political Influence which has given organized steel workers
a voice in the determination of public policy with respect to
the steel Industry.
It Is possible that the SWOC may achieve
through legislation and governmental action many objectives it
cannot secure through collective bargaining.
Certainly, the
election of SWOC members to municipal offices is an indication
of the strength of the union organization.
There can be very
; little- doubt that thousands of steel workers who are not members
; of the SWOC may support Its political and legislative program.
; Finally, the existence of legislation favorable to organized
labor, such as, for example, the National Labor Relations Act and
■ the Waish-Iiealey Act, has tended to enhance the power and effec­
tiveness of the SWOC.
j
Probably the best indication of strength is the fact.that,
j in spite of the setbacks of the "little steel" strikes and a
i
period of severe business recession, the SWOC now exists as an
active functioning labor organization which has laid a permanent
foundation for collective bargaining in the basic iron and steel
industry.
1
v_ _
'‘See Chapter
.
■
2
See Chanter 2Z2T-
-
&d
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
VII.
P O L I C E S AND ORGANIZATION OF THE S E E L CORPORATIONS
ji. Development of Collective Bargaining; Policies.
Management is constantly striving for more efficient, lowcost operations, calling for a combination of technological and
organizational efficiency.
ing technological progress.
In recent years steel has made strik­
The introduction of continuous mills
has not only lowered the production cost of flat-rolled steel but
has also improved its quality and thereby rendered it adaptable
ih
i
to manv more uses.
Metallurgic&l research has developed new
stainless, alloy, and lightweight steels. Countless other changes
in open hearths, blooming mills and wire mills have reduced the
A cost or improved the quality of steel products.
Nevertheless, techniques of management have lagged in the
a !'
ft field of personnel administration.
With the exception of the
S American Rolling Mill Company, which undertook a comprehensive
.1$
H program of job study and wage classifications as early as 1929,
§te
|p it was not until price control broke down and competition Qecame
f, increasingly acute during depression years that the other major
fy.
companies gave much thought to "scientific management". _The longdelayed programs for formulation of systematic job evaluations,
jl' work standards, incentive rate3, employment policies and evalua-
gfa tion of performance of the working forces were just getting under
f
jj|j way when collective bargaining became an important factor in the
j| industry.
At once it was necessary to examine the effects of
|/ f these improvements not only on profits but also on the workers
•"jfe who, through organization, were becoming more powerful and ar-
jjj|ticulate •
ifei:
r
h?. *
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Prior to 1953 the term "collective bargaining" was sel­
dom used by the managements of the large steel corporations.
As already pointed out, a few companies had set up employee
jsentution plans to enlist the "collective cooperation" of
r>,or,r*o«
employees by providing a means of discussion of mutual prob­
lems.^
Still, in some other concerns, any official who was so
bold as to suggest any form of representation for the workers
might be threatened with discharge.
Possessing unchallenged
it control over employment, wages, and working conditions, many
corporation executives were unmindful of the tactics used by
their supervisory forces, and neglected to examine the effect
of their unilater/ai policies on the 'working forces.
After 1955 the general establishment of employee repre­
sentation plans throughout the industry brought to light many
shortcomings of 'management.
The companies developed a manage­
ment technique of group relations which enabled them to reap
the benefits of meeting with representatives of their employees
|y without surrendering to any considerable degree their tr&ditional unilateral control over eiaployment policies.
During the
I,
I h.I.R.A. Code period, moreover, most of the companies, were will
ing to "meet with" representatives of organised labor.
jL
At a
Waite house conference in December, 1934, the heads of several
I" large steel corporations, faced by the President, members of
f*-
the National Steel Lab o r Relations Board, and representatives
a;
''
fcf ^3ee page
■HIS
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
108,
of trie Amalgamated ana the A.F. of L . , stated that they would
agree "to meet, negotiate, and treat with" the bargaining comgr-r
k
fe.
L
mittee of any labor organization, as such, as the representativo of those employees who were its rightful members.
They
refused to sign contracts or to recognize any organization as
the sole bargaining agency.
This conference broke up because
the labor spokesmen would not relinquish their'demand for the
majority rule principle in representation.-^The strong opposition of the steel corporations to passage
h'A
jg of the ajagner bill was a clear indication of their antagonism to
outside unions.
They opposed this legislation because it would
outlaw employee representation plans and thus "drive a wedge be­
tween employer and employee".
They argued, further, that the
bill would encourage domination of steel workers by outside
unions and that it would legalize majority rule and the closed
shop.^
Under the Taylor-Lewis agreement of March, 1937, U.S. Steel
accepted neither the closed shop nor majority rule; it merely
agreed to incorporate in a written contract what had been since
1934 the stated policy of the industry with respect to bargaining
jU- with representatives of employees. Yet a signed contract implied
L
g some degree of acceptance of the SWOC and the abandonment of tne
IS practice of opposing outside unions.
I
Many steel executives,
consequently, felt that Mr. Taylor had "sold the industry down
§R the river."
8§;
ft
^For full discussion of this conference see Daugherty, et. al.,
economics of the Iron and Steel Industry, Vol. II, pages 1040-1046.
2~, 1
_
Steel .pacts. April, 1935.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
109
Since 1937 there has been no such tiling as an industry­
wide policy of collective bargaining.
The large union companies
have followed one course, the smaller concerns another, and the
"little steel" groups a third policy.
The large corporations that signed contracts with the
Up
SViCC, although still unconditionally opposed to the closed or
|f
union shop, have either formally or in practice recognized the
HI
principle of majority rule.
PI
Under the National Labor Relations
.act, of course, employers are compelled to bargain collectively
with a union as the exclusive bargaining agency if the union is
certified by the Board as the representative of the majority in
the bargaining unit.
jjg
Even where the contracts specify recogni-
tion for members only, the companies have in fact dealt with
the SWOC as if it were the exclusive bargaining agent, and in
some cases have suppressed the activities of other groups.
L
H
In
general, management has preferred to deal with a single organ­
ization as the representative of plant employees.
Nevertheless,
the concept of "collective cooperation" which was thought to
t
I
&
underlie employee representation has been in large measure discarded.
Because the SVi/OC is a militant organization which has
I
V- challenged the power of the steel companies, it has been looked
|§§ upon by management as a negative force in industrial relations.
L
|d Company executives have resisted the attempt of the union to
secure a measure of control over vital matters such as the
setting of v/age rates and the determination of lay-off and
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
1 1 0 .
promotion polcies.
Management has attempted, in so
far as
possible, to limit collective bargaining to settlement of griev­
ances .
Looking upon labor relations only as part of a broader
program of industrial relations," the large companies have taken
the position that they should neither encourage nor discourage
workers to belong to the union.
At the same time company execu­
tives have attempted to eliminate the causes of grievances, to
establish a reputation for square dealing with employees, and
to maintain in fact as well as in theory an "open door" policy
on hearing of complaints.
Some have thought that if management
SiP
fe; by its own action could develop sound industrial relations pro­
H
grams, there might no longer be any necessity for outside labor
unions.
The proponents of this theory claim that after elimina­
IS tion of those conditions which lead to employee dissatisfaction
organizing issues will disappear and the union may become a
"wnite elephant".
The term "labor relations" has been used by many company execu­
tives to denote group relations or collective dealing with repre­
sentatives of the workers. As such "labor relations are only
a part of what these executives consider "industrial relations".
The latter term includes in addition ail employer-employee re­
lationships including employment, training, plans for workers’
security, evaluation of performance and other matters sometimes
covered by the term "personnel administration".
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
11:
h. few of the smaller companies have agreed to make union
rnenoership a condition of employment.
Several others "as a
matter of policy" have persuaded their workers to belong and pay
dues to the S'WOC.
In such cases, furthermore, major wage and em­
ployment policies have usually been determined jointly by union
and management representatives through the process of collective
bargaining.
Thus the united front of the industry against the
closed shop has broken at the fringes.
There are several rea­
m
sons for this development.
First, the smaller companies have
been forced to grant the SWOC complete recognition to prevent
serious labor troubles.
Such companies have had neither the re­
sources nor the inclination to fight the battles of the industry.
Second, an expedient means of eliminating conflict between organ­
ized and unorganized workers in a plant Is to force all employees
to join the union.
Finally, some executives of these smaller com­
panies have looked upon the SWOC as a constructive rather than a
purely negative force in the industry, and the SWOC has indicated
that union-management cooperation programs can follow as a result
of complete recognition.'*'
More important, perhaps, is the possi­
bility that the interests
of the small producers might be safe­
guarded by an alliance with the SWOC.
In October, 1938, Philip
Murray indicated in tills respect that the SWOC might propose a
P1
'
• This union-management cooperation program has been outlined in
f: an SWOC pamphlet called "Production Problems".
In 1939 this
%; program was in effect in about ten fabricating companies and was
Hi being started In a few small steel corporations.
thk
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
federal legislative program to eliminate "the terror-stricken
condition of the steel industry brought about by a system of
cutthroat competition and resulting destroyed earnings."^ It
has not been uncommon for executives of the smaller steel com­
panies to meet privately with the SWOC to discuss a solution of
this mutual problem.
The "little steel" companies have made no secret of their
opposition to outside unions in general and to the SWOC in par­
ticular.
L
Although they have met with SWOC committees to discuss
grievances, they have not budged from the position taken in 1934
with respect to making signed contracts.
While formal dealing
with outside unions has been looked on as undesirable, the
"little steel" companies have been anxious to cultivate more
intensive "collective cooperation" through employee representa­
8§g
11 tion plans or successor employee associations.
These unaffiliated
groups, however, have become much more "independent" in their ac­
tions and have not hesitated to take advantage of the outside
pressure of the SWOC to bargain for concessions from management.
No less so than the corporations under contract with the SWOC,
the "little steel" companies have attempted to avoid more inten­
sive unionization by eliminating in so far as possible the bases
of employee dissatisfaction.
m
3.
Management Organization.
The advent of collective bargaining has focused the atten-
tion of company executives on problems of "human engineering",
^Statement of Philip Murray in Cleveland, October 13, 1933,
SWOC Press Release.
iiS*
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f
so that today industrial relations, as such, constitute a
large part of the science of effective business management.
|
The femula tio n of industrial relations policies has become a
p.
major function of top management, and administration of such
I
4
w-
policies has become a primary responsibility of every operating
_
fff
official from the vice-presidents down to the foremen.
Company-
l' wide understanding of policies as formulated is essential to
_
their satisfactory administration.
It has been difficult, how-
?
r,
ever, for foremen and superintendents, who have been accustomed
“
to fighting organized labor, to adjust themselves to the new
L
environment of the collective bargaining relationship.
H
not surprising, therefore, that the practices of the supervisory
It is
I forces have often been at variance with stated company policies.
in
k' Corporation executives, often disagreeing among themselves on
f
the interpretation of policies, have been confronted with the
H
? problem of developing a consistent management attitude in all
■
levels of supervision towards collective bargaining.
In this
respect, the structural organization of management as it conf
cerns the industrial relations program should be touched upon
C*"-■
t
f
briefly.
In large companies today, policies are generally formu-
^
lated by an executive committee composed of the President and
?
other _top officer's of the corporation.
The top industrial re-
lations officer, whether holding the position of Vice-President
iiily or Director of Industrial Relations, generally sits with this
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
114 *
committee as a consulting expert In the field.
It is his duty
to be familiar with the details of the industrial relations
program, and to advise management in the formulation of proper
policies.
Once formulated, policies are transmitted through
the line organization to the operating departments.
The office
I of the Vice-President or Director of Industrial Relations then
r'
serves as a clearing house of Information concerning the admin^ istration and interpretaion of policies.
In other words,
the
chief role of the head industrial relations officer is that of
staff advisor to the line organization.
His other duties may
oe to supervise and coordinate training programs, safety work,
I and
il
employment policies, to oversee the administration of in-
surance, annuity, and welfare plans, and to handle fourth step
grievances for the executives of the corporation.^ In some
cases the Industrial Relations Director reports to the Vice-
is
President of Operations.
Because of the increasing importance
of the industrial relations function, however, the trend is
toward giving him the rank of Vice-President reporting directly
to the chief executive officer.
The same division of staff and line functions Is charac­
teristic of the several plants of each corporation.
a General
Works manager reporting to the Vice-President of Operations is
usually in charge of each plant.
Reporting to the 'Works Manager
are the various operating department superintendents as well as
■^"See
C .h
JU JU
-
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
heads of the locai staff departments.
The riant sutler-
visor or manager of industrial relations consults v/ith the
d'orks manager, the department superintendents, and the foremen
on industrial relations matters.
Under his., direction are usu­
ally placed employment, training,.safety, and first aid.
One
of his many duties is to meet v/ith the union grievance committees
and to advise the foremen and superintendents, when necessary, on
procedures for dealing with committeemen.
The main responsibility
for administration of industrial relations policy, however, is usu­
ally placed on the shoulders of the operating officers, the super­
visor of industrial relations assisting them, in an advisory capagp city in so far as necessary to coordinate activities and develop
uniform procedures.
Although reporting directly to the Works
kanager, the local supervisor is usually constantly in touch with
|
the corporation Vice-President or Director of Industrial Relations
from whom he receives detailed interpretations of policy and ad­
vice on the handling of various problems as they arise.
Contracts with the SWOC or other labor organizations are
usually negotiated by the top executives and the Industrial Re­
lations head of the corporation for all plants.
In some cases,
however, the Works Manager may carry on negotiations where a
particular labor organization is confined to a single plant.
Interpretative rulings on matters of general application such as
basic wage rates, hours of work, cr recognition of the union are
p generally determined by the executives of the corporation with
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
the ussistance and advice of the chief industrial relations of­
ficer.
The application of seniority rights, division of working
tine, adjustment of individual wage rates, 'and adaptation of
grievance machinery are more generally left for local plant nego­
tiation.
The settlement of grievances is in so far as possible
a plant, responsibility, but unsettled cases are appealed to com­
pany officials#
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
m
ft-?.-:
;ion of the 1937 Contracts.
The course of the "Taylor-Lewis” discussions which re­
sulted in recognition of the union by "big steel” were reviewed
in Chapter 111.
The formal negotiations between officials of
the 3dCC and the Carnegie-Illinois Steel Corporation were con­
cerned primar11y with details.
The general wage increases and
the establishment of the 40 hour week, which had been discussed
oy hr. Taylor and Mr. Lewis, were incorporated in this agree­
ment.
Since the contract grew out of private and confidential
meetings of two individuals, there really was not any formal
negotiation procedure.
The Carnegie-Illinois agreement of 1937,
nevertheless, has been the standard contract not only of other
'U.S. Steel subsidiaries but also of the independent steel com­
panies that have recognised the SwCC.
Much more important than
the procedure of contract negotiations has been the interpreta­
tion of the content of the agreements and the efforts to build
up a unlon-manageruent relationship within the framework of the
contracts.
These matters are to be treated in detail In sub­
sequent chapters.
The main issue, of course, has been the
recognition status of the union.^
In 193S the SWOC had over 625 agreements with employers.
Cf these about 70 were with companies in the iron and steel in­
dustry, the remainder being v/ith concerns In the allied steel
\
fabricating and processing Industries.
The SY«'0C contract com­
panies in steel employed at that time between 60 and 65 per cent
1. ...
m e standard contract specifies recognition of the union as the
oargaining agent for its members only
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
of the '.Yorkers in the industry.
Three large companies, U.S.
Steel, Jones ana Laughlin, and '/.'heeling accounted for approx­
imately SG per cent of the employment in all steel companies
under contract v/ith the SV/OC, or nearly half cf the total em­
ployment in the industry.
In march, 1957, the ShOC set cut to force the independent■
steel corporations to follow the lead of "big steel". As soon
as lodges had been set up in the principal plants, the regional
office of the SV/OC contacted, the independent companies by mail,
with the letter was enclosed "a proposed collective bargaining
contract" the principal features of which were identical with
those of the Carnegie-Illinois agreement.
The letter explained
to the companies that inasmuch as a considerable number of their
employees had already been enrolled as union members, it would
be "mutually advantageous to have this agreement signed at once".
It was further stated that a representative of the SV/OC national
office, together with a committee cf the company’s employees who
were members of the union, would request an appointment for the
purpose of discussing the enclosed contract.
For the first 3
months the national office was swamped by demands on the part
of lodge officers, union members, and small steel companies to
begin "negotiations" at once.
In official Instructions to the
staff, the SWOC executives pleaded for patience and took a firm
stand against ultimatums delivered by over-enthusiastic new
lodge officers to the employers as well as to the SV¥OC.
The
national and regional officers assumed personal charge of
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
pi negotiations v/ith. all but the very small steel cr fabricating
companies.
national
all proposed contracts had to be approved by the
officers before final execution.
In so far as pos-
•§f§ siblc, t h e agreements were to conform to the standard Carnegielilinois contract.
Characteristically, the SYi/CC, a strongly
m--.
centralized organization, negotiated its agreements during this
pr period "from the top down".
The lodge officers and committee­
men sat in on the negotiations mostly for education and training,
In some companies, where management delayed recognition
E of the union, it was impossible for the SWGC staff to forestall
H;:
strikes.
In one case, for example, the company was unwilling
to sign an agreement, on the grounds that the President had
died and that the board of Directors would have to make the defe’; cision.
HI
In spite of pressure by the SYVCC to restrain the local
committees, both of the company’s plants were shut down.
Im­
mediately, the General manager of the company signed the con­
tract and operations were resumed in eight hours. host of the
sea
gf. large steel companies, apparently, delayed action on one. prei­
ll text or another to "see what the other fellows were going to
do".
They signed after the local officers had called a strike
or when It was apparent that a strike which they wished to avoid
might take place.
The circumstances of the negotiations with Jones and
Laughlin, next to U.S. Steel the largest SYJCC recognizing ccn£
cern, were set forth In Chapter III.
The Company was willing
fl.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
to sign toe standard contract recognizing the union as, bargain­
ing .agency for its members only provided that it be allowed to
sign a similar agreement with an independent union,
an "organ­
ization strike" followed by a HLRb election resulted in victory
for the SwOC.
Although the pressure came from the leaders of
the local unions, the SiiQC executives were' able to retain con­
trol of the negotiations.
The company signed a contract similar
to that of Carnegie-Illinois except that the union was recog­
nized as the exclusive bargaining agency for all the plant em| plcyees.
f
t
A similar course of events in the Pittsburgh and Sharon
companies resulted in
contracts extending sole bargaining rights
to the union.
The similarity of the main provisions of the 1927 con­
tracts, both in steel as well as in the fabricating and processing
industries, was characteristic of the "follow the leader" policy
prevailing at that time.
Both the union recognizing companies
and the SV/OC staff seemed to think that "what was big was best".
The content of the agreements with "big steel" was of secondary
importance.
The acceptance of union recognition as a basis for
collective bargaining was of primary concern.
Executives in the
larger steel companies at first looked upon the agreements as
ms
limiting the scope of collective bargaining to those employees
vino were union members.
Some persons, in fact, have thought
of the "members only" contract as a device to "keep the union
at arm’s length" rather than a gesture to establish permanent
t"
m
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
121
relations.
The SnOC, on the ether hand,- looked on such a con­
tract as "a letter of introduction" which might lead to more
complete acceptance of the union In the future.
Intension of Contracts in 1958.
In September, 1957, the SWGC officers announced plans
for a convention to draft a oroad policy for guidance cf both
the national office and the local lodges and a program to gov­
ern negotiation of new contracts with the companies, as the
existing ones were to expire in February,'1S38.1
In December,
1957, 924 delegates representing 1,080 lodges assembled in Pitts­
burgh for a "wage and Policy Convention".^
Their main action
ite
was to endorse the report of the National Wage Scale and Policy
Committee which had been appointed by the SWGC executives. This
committee studied and summarized 857 resolutions dealing with
I
Iss
such matters as general wage increases, abolition of tonnage
and piece work rates, adjustment of differentials, hours of
work, vacations, seniority, grievance procedure, and union rec­
ognition.
It briefly reviewed in a report the accomplishments
of the SW'OC as well as the seriousness of unemployment brought
about by the business recession and the introduction of tech­
nological improvements.
It recommended that the Convention
-Steel Labor. September 30, 1937.
^Steel Labor, December 31, 1937.
It should be noted that this
was not a constitutional convention. No plans were discussed
for establishment of a permanent industrial union of steel
workers. The Convention, in effect, gave sanction to the con­
tinued existence of the Steel 'Workers Organizing Committee.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
endorse the work of the SUGG and -ive it "full power to se­
cure the best joint wage agreement possible” with the employers.
It proposed further that the committee's report be adopted as
a complete substitute for the various individual resolutions
referred to it."*- Without dissent, the delegates granted this
authority and expressed appreciation of the services rendered
on behalf of steel workers by the S'WOC which had been chosen
as their collective bargaining agent.
Vested with complete authority to make any kind of settle­
ment, the SWGC executives commenced to negotiate v/ith "big steel"
2
early in 1938.
With steel operating below 30 per cent of capacity,
Steel Workers Organizing Committee, Report of the National Wage
Scale and Policy Committee, Vi/age and Policy Convention, Pittsburgh,
.December, 1S37.
There were 130 resolutions submitted delegating authority to
S'WOC officers to make new contracts. The text of one of them
follows:
"WHEREAS, we, the members of Lodge Ho. 1181, Amalgamated Asso­
ciation of Iron, Steel and Tin 'workers of North America, and em­
ployees of Carnegie-Illinois Steel, located at South Chicago,
i
highly appreciate the service rendered on our behalf by the Steel
Workers Organizing Committee, whom we have chosen as representa­
gig tives of our Union, and as our collective bargaining agents, In
dealing with our employer; and
jPr't'
"WHEREAS, we recognize the importance of strengthening our Union
and the necessity^ of having the proper leadership to guide It in
order that our future may be made secure; therefore,
"BE IT RESOLVED, that we authorize and instruct the Steel 'Workers
Organizing Committee to continue their service as representatives
of our Union, and as our collective bargaining agents, and that when
meeting in conference with the representatives of our employers,
that they will have full power to secure the best joint wage agree­
ment
possible."
o
^The S'WOC negotiated the 1938 agreements with certain officials of
the United States Steel Corporation of Delaware, a management cor­
poration, on the Board of Directors of which are the presidents of
the subsidiary' companies which contract for management service. The
understandings reached in these negotiations were drawn up in the
form of agreements which were signed by the individual subsidiary
companies.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
unemployment rolls mounting, and many of the U.S. Steel lodges
reduced to nucleus groups of ardent unionists, the S'.IGC could
hope at best for an extension of the existing contracts for
another year.
Upon refusal of the S.VCC to accept wage reduc­
tions, "big steel" insisted upon a 20 day termination or "es­
cape clause".-*-
In accordance v/ith the "fellow the leader"
policy most of the independent steel companies, which had made
contracts v/ith the SWOC in 1937, did likewise.
Crucible Steel,
however, refused to make any term contracts with the SY/GC and
continued the 1937 agreements in its plants only on a "day-toda-"
y" basis.
^The
Iment
text of this clause in the 1938 Carnegie-Illinois agree­
follows:
"SECT!Oil 1: The 1937 agreements shall continue until changed
or terminated as follows:
"(a) Either party may, subsequent to February 28. 1938, at
any time and from time to time give ten (10) days’
written notice to the other party of the time for the
commencement of a conference of the parties for the
purpose of negotiating the terms and conditions of a
change of the 1937 agreements, which conference shall
be at the office of the Corporation in Pittsburgh,
Pennsylvania, unless otherwise mutually agreed, and
"(b) if, because of a failure to agree, the 1937 agreements
are not changed by a written agreement entered into by
the Corporation and the Union within twenty (20) days
from the giving of said notice, then the 1937 agree­
ments and all of the provisions thereof, shall termin­
ate upon the expiration of twenty (20) days from the
giving of said notice."
See also Chapter 1 2
page £0 above.
iss®
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
1 2 4 .
Until such time as business should improve, the SV»OC
as on the defensive.
Although it had complete power to nego­
tiate new contracts without the participation of local plant
officers, it was thought advisable to have the lodges repre­
sented on the negotiating committees.
Nevertheless, care was
taken to see that none cf the local officers "upset the apple
The SViCC executives urged that the union was not to
cart
J.
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or amendments, for they felt that the companies would take ad­
vantage of such action to institute demands for a wage cut.
_ur thermo re, any violations of' the contract on. the part of hot­
headed local leaders might cause the companies to break off re­
lations at a time when the organization was we a k .
.curing the
recession period, therefore, the national officers were forced
to "sit cn the lid" very tightly.
The independents continued to take their cue from U.S.
•steel.
as one executive expressed it, aWhen U.S. Steel puts
on its straw hat in the springtime,
the rest of the companies
do likewise; when 'big steel* takes it off in the fall, the
independents reach, for their fedoras."
Yet, generally speak­
ing, union-management relations since 1937 had progressed more
rapidly in the small companies under contract with the SV/OC.
bxeeutives. .of independent companies appeared to be willing, in
some cases, to grant more complete recognition to the SV/OC, but
he sitated to deviate from the standards set by "big steel" for
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125,
W-
If
«*
•••
fear of reprisals
by anti-union customers and comoetitors.
—
*
3v
b>
the beginning of 1959 it had become apparent to SWGC executives
that, since the union was weakest in U.S. Steel plants, the
I ',
"follow the leader" policy in the industry was becoming a draw­
back rather than an advantage.
The SWGC needed more than "a
letter of introduction" to secure complete recognition.
C.
The Policy of "encirclement."
ii
As early as 1937 some of the SWOC staff representatives
had secured contracts with small fabricating concerns providing
for the check-off and the union shop.
At the Wage and Folicy
Convention, however, the SWGC officers had thought that, in
view of the long-established traditions of hostility to unions
in the steel industry, it would oe both unwise and provocative
of unnecessary difficulty formally to demand the union shop at
that time.
As business revived and the SWOC became more con­
scious of the necessity for complete recognition if a permanent,
Industrial union were to be established, this attitude changed.
Finding it impossible to budge the large companies, the
Siif0C set out, in the fall of 1939 when business was booming,
to put some of the smaller steel producers "on the spot".
The
procedure was to give the companies notice cf desire to termin­
ate the contract under the "escape clause", proposing certain
amendments" and demanding the union shop.
Where majority status
had not been established previously, the SWOC usually suggested
.a consent election supervised by the Labo'r Board.
If the
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cc-punies were adamant, the SYJOC staff representatives informed
them
that they -would no longer "sit on the lid".
The
local
of-
I ficers then were likely to take concerted action to force the
,vcoiaoanies into line.
The procedure was sometimes to s-oread
I
ij tain
about the mill that a strike was impending, at the same
)
\ time giving the employer no indication of when or where trouble
might
break out.
'i
kany companies were willing to grant the SWOC complete
I- recognition.
They might refuse, however, to sign a formal union
? shop contract on the grounds that anti-union customers and com! petitors might punish them for going beyond "big steel".
A
solution was found sometimes in an informal understanding whose
contents were not for publication.
The following "statement of
policy" by a company is a case in point:
"l. The Company believes that its interests and
the interests of its employees would be better
served if all of the employees were members of
the Union.
"2. The Company, as a matter of policy, will en­
deavor to persuade its employees.... to become mem­
bers of the Union.
I
ju
"3. If at any time the Union shall f u m i 3 h to the
Company a list of employees....who are noiraembers
of the Union, the Company agrees to advise such em­
ployees of the Company’s policy and to urge them to
join the Union.
"4. The Company believes that those of its employees
who are members of the Union should pay their dues,
and If the -Union furnishes the Company with a list
of Union members who are delinquent,- the Company will
endeavor to persuade such employees to pay their dues.
if
te
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127.
"5. If at any time the Union feels that the o b ­
jects cf this d e c l a r a t i o n cf policy are not being
a d e q u a t e l y accomplished, the Company agrees to
consult with the p r o p e r officers of the Union,
w i t h reference to ways and means of better a c c o m ­
p l i s h i n g the o b j e c t i v e s indicated in this mernoran d u n .
u.
The S i g n ificance
The
of the Steel
basic labor
sentially agreements
Contracts.
contracts In the
steel
industry are e s ­
to establish c o l l e c t i v e b a rgaining r e l a ­
tions'll Ins rather than d o c uments r e c ording in d e t a i l the f ixincr
a.
' >
of wages and wo r k i n g
negotiation.
conditions r e a c h e d as
A c c o r d i n g to Philip hurray,
■_i
a result of joint
c o llective b a r g a i n ­
ing in steel d u ring the past two and o n e - h a l f years has been
"a continuous educational
racy in companies
P
2
8“ rights.
process"
to d e v e l o p industrial d e m o c ­
formerly n o t orious
for s u p p r ession o f workers'
The major issue lias oeen the accep t a n c e
or non-accep-
ll tance of collective b a r g a i n i n g r a ther than the adjus t m e n t of
if?!>' differences through the p rocess o f c o l l e c t i v e bargaining. Labor
K
'
h
.
t
v
.'
’
fl relations in steel, therefore, have b e e n de p e n d e n t o n the i n t e r ­
pretation rather than
the s t a t e d terms of the agreements.
If interpretations have b e e n few.
statements of policy,
Written
Oral unde r s t a n d i n g s a n d informal
sometimes p u b l i c l y denied,
have constituted
I the f r a mework of collective bargaining.
The
standard U.S.
Steel
symbol of n ew relationships
contract of 1937 was hailed as a
in steel.
The SWOC hop e d that these
p.' ^The n a m e of this company cannot be disclosed.
^Interview. Philip Murray, Chairman, SWOC.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
128,
relationships would soon result in complete acceptance of the
union and establishment of whole-hearted collective bargaining•
The independents were urged to follow the lead of "big steel”
in fringing to pass a new era in industrial relations.
Yet. for several reasons the relationships in "big steel"
have been unsatisfactory to the SWOC.
In the first place, man­
agement has tended to take a negative attitude In limiting col­
lective bargaining to little more than settlement of grievances.
On the other hand, a determined effort has been made to elimin­
ate the causes of grievances.
In the second place, most of the
local unions in U.S. Steel plants have been weaker than the
locals In other companies.
Yet the Carnegie-Illinois contract
sets the pattern which the other SWOC recognizing companies
have chosen to follow.
Once the opening wedge to unionization
of the industry, the U.S. Steel agreement is now perhaps an
Impediment to more complete acceptance of the S'WOC.
This con­
tract, however, is the best agreement obtainable in view of
current economic conditions and the present attitude of U.S.
Steel.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
IX.
■.
UNION RECOGNITION
Recognition for 1.1embers Only.
Nearly all of the major disputes between the SWOC and
the companies have grown, directly or indirectly, out of the
doubtful and insecure status of the union.
The large companies
have taken the position that they should in no way encourage or
|f discourage membership in the union.
The principal objective of
the SWOC has been to obtain 100 per cent organization.
The best
means of achieving this end is to force the companies to co­
operate by requiring membership in the union as a condition of
employment.
The recognition clause of the standard (Carnegie-Illinois)
agreement sets forth three principles:- first, the corporation
recognizes the union as bargaining agency only for its members;
second, the corporation must refrain from interference with the
right of its employees to become members of the union; and,
third, the union must not coerce employees to become members
nor solicit membership on the employer’.s time or on plant prop­
erty.
The first statement indicates that there is a distinction
.between union and non-union workers. The second and third ex|r.
E press the mutual feeling of distrust at the time the agreement
c The text of this clause follows: "The Corporation recognizes the
pfUnion as the collective bargaining agency for those employees of
- the Corporation who are members of the Union.
The Corporation
recognizes and will not interfere with the right of its employees
I to become members of the Union. There shall be no discrimination,
L., interference, restraint or coercion by the Corporation or any of
Ip its agents against any members because of membership in the Union.
The Union agrees not to intimidate or coerce employees into memJgbership and also not to solicit membership on Corporation time or
f plant property.”
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p was made.
These latter statements have provided a basis for
each party to make charges and counter-charges of violation of
the contract by the other.
Even when the contract recognizes the union only as the
representative of its members, the tendency of most companies
has b-een to deal with the SWGC as the sole bargaining agency.
In most cases the SWOC has been the only active labor organiza| tion in the plants.
The wages and working conditions set forth
| in the contracts apply to all plant employees, and in many cases
were established prior to the agreements.
i
Should management at-
tempt to distinguish between union and non-union workers by find­
ing out which employees were members, the S’WOC would probably
charge the company v/ith interference with workers’ rights to be-
I come members of the union.^ As one corporation official stated,
?i
| "In the absence of activity by any other group, we consider the
%
I SWOC as the bargaining agency for all employees, for we have no
| means of knowing, and do not care to know, which employees be«)
| long to the union and which do not."
| management did attempt such differentiation in one company. The
| contract, which recognized the union as bargaining agent for its
if members, provided for time-and-one-half overtime pay for all
| work in excess of 40 hours per week.
The company was willing to
I let non-union employees work 48 hours per week if they so desired
| but they would be paid only their regular rates for the extra tim
| The company, "in order not to violate the contract" which speci| fied punitive overtime pay for union members, requested each em|f ployee asking for extra time to certify that he was not a member
H of the union.
The SWOC charged that such procedure constituted
I; interference with the rights of workers to become union members
I and thus was a violation of contract and of law.
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151,
Trie large corporations have been careful to avoid, wherever
possiol-s, formal contractual relations with non-SWOC groans.
Seme
of the J.5. Steel subsi'diaries have bargained with independent or­
ganizations, a.F. of L. craft unions, and the Railroad brother­
hoods as representatives of their members.
The
stated policy of
U.S. Steel is to negotiate and contract with the representatives
of any groups of its employees and with any organization as the
representative of its members.
Although management has never re­
fused to meet the representatives of any group, written agreements
have been discouraged.
In some cases where the non-SWGC groups
were persistent in their demands, however, the local plant man­
agers gave'them a formal "letter of recognition".
There appeared to be a desire, in other SWOC contract com­
panies as well as U.S. Steel, to deal only with one organization
in each plant.
One company, for example, gave the S’
WOC a letter
stating that, although the contract recognized the union as the
bargaining agency for its members only, the company would deal
with no other group during the life of the agreement.
B . Recognition as Exclusive Bargaining Agency.
Those companies which have recognized the S’WOC as the ex­
clusive or sole bargaining agency for all- plant workers usually
have done so only after an election or formal certification of
majority representation by the Labor Hoard.
The managements of
these companies have pointed out that for all practical purposes
in dealing with the SWOC the exclusive bargaining provision Is no
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different from the "members only" clause.
Where elections were
hell, there was the added advantage of knowing definitely how
tie majority of v/orkers felt towards unionization.
The decisive
vote for the SWGC in plants of the Jones and Laughlin, Fitts-•
c1
burga, anu~ onaron
Steel- companies
was very effective in convinc­
ing both pro-company employee representatives and union-hating
operating executives and foremen that the "old days" had passed.
At least they could not charge that the company had doublecrossed the so-called "loyal" non-union workers.
The exclusive
bargaining contract, furthermore, symbolizes more genuine acceptance on the part of the company of the collective bargaining
relationship with the union.
It is not mere coincidence, there­
fore, that union-management relations in the three companies
mentioned above have been more harmonious and constructive than
has been general in the steel industry.
To the SWGC exclusive bargaining rights constitute an im­
portant legal safeguard.
The union cannot press charges with
the Labor board for refusal to bargain unless it represents the
majority of employees In the bargaining unit.
portance, however,
Of greater im­
Is the fact that majority representation is
a necessary stepping stone to complete recognition.
For IOC per
cent organization the SWOC must count on management encouragement
either in the nature of informal persuasion of employees to join
the union or In the form cf a union shop contract.
Lotn are lega
only If the union is the representative of the majority of em­
ployees in a viven unit.
In more recent negotiations 01 contract
See page 7 2 above,
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1 3 3 .
therefore, the SVvCC has sought to obtain exclusive bargaining
rights either by means of a consent election or a check cf mem­
bership cards oy the Laoor hoard if the company is unwilling to
concede majority representation.
The sole bargaining provisions, however, do not solve
the probJ-em of union and non-union workmen. ' As in the '’members
only" clauses, it has been customary to prohibit interference
v/ith workers' rights on the part of the company and solicita­
tion of membership inside the plant on the part of trio union.
It is usually provided, furtner, in accordance with the National
Labor Relations Act, that an individual employee or a group of
I
employees shall have the right at any time to present grievances
to their employer.
C. Complete Recognition.
as
pointed out in Chapter IV, the policy cf the-ShOC has
been to force the smaller companies to accept the principle of
I
the union shop.
In many cases, however, complete recognition
| has been secured indirectly by tacit understanding.
i has
The SV«OC
convinced several companies, where the union had a majority,
| that their interests would be best served by elimination cf ir§ ritation and friction between union and non-union workers.
t
|
ue-
cause of the background of hostility to organized labor in the
steel industry, many employees have remained unconvinced that
management’s attitude has changed even though a union contract
aas been signed.
If companies should Instruct tneir foremen and
ir
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supervisors to encourage union membership, very feu workers,
so SkOC spokesmen claim, would remain non-union.
although ob­
jecting to the coercion involved in making union memoersr.ip a
condition of employment, several company executives have prom­
ised to use "every reasonable means" to persuade ail workers
to join and support the union.
The SWOC has, in several in­
stances, accepted such promises cf cooperation as complete
recognition and has not pressed the companies to reduce the
terns to writing either in a statement ci policy or a formal
agreement.
It is difficult, therefore, to estimate the total
number of concerns that have accorded complete recognition.
The large companies had, up to the end of 1959, taken
a strong stand against such "encroachments" by the SWOC.
They
maintained that management had no more right to encourage work
ers to belong to a union than to interfere v/ith their rights
of self-organization.
Some concerns, moreover, have avoided
any action that might give the SWOC organizers or committeeiiien "undue prestige".
Fundamentally, this attitude reflects
a desire on the part of management to protect workers from
| coercion, perhaps by a minority, and to keep the SWOC organ| ization In the plants as weak as possible.
In a few cases,
Si management has made concessions to employees directly in an at
15 terr.pt to "eliminate,the need for outside unions".
|
Yet by the
end of 1959 several executives even In the large corporations
|f. were privately expressing the belief that more complete and
£
w
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? permanent recognition of the Ssi/OC woulo have tc be conceded if
serious
li.
labor troubles were to be avoided.
Collection of D u e s .
The issue cf dues collections is sc closely bound up with
I
r union recognition that it deserves mention at this point.
nl-
though the standard contracts state that the union shall not
"solicit membership on Corporation time or plant property", no
*
specific reference is made to dues collections inside the plant.
Nearly all company executives have taken the position that man­
agement cannot prevent one union member from collecting dues
from another at lunch hour, in the wash rooms, or during a rest
period.
The companies have, however, disciplined workers for
■ collecting dues inside the plant if conducted in such a manner
as to interfere with operations.
In some plants the SWOC proceeded as early as 1938 to
appoint dues committeemen, to collect dues systematically
the plants.
in s i- 'J p
It was quite natural that an active dues committee-
& man might also be instrunental in inducing his fellow workers to
r become members cf the union.
If, furthermore, the dues com-
5 mitteeman was Identified by a large badge, hi-s fellow workers
t
-
g would be constantly reminded of the existence of the union in
|
the plant.
The SWOC was anxious, therefore,'that management
fy formally recognize dues committeemen, thus making a gesture of
j| endorsement of the union which would add greatly to its prestige
j| In a few plants the management tacitly agreed not to interfere
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1 5 6 .
v/ith the e st ab 1is’
a ment of the dues corami tteera^n system.
In
others, management took the position that the wearing of badges
and toe open solicitation of dues on plant property contravened
the spirit of the agreement, and requested that the dues com­
mitteemen remove their badges.
The reaction of the union was
often to double the number of committeemen and Increase the
size of their badges.
Of greater concern tc the employers, however, were the
so-called "dues picket lines".
In several districts a large
number of unionists 'would station themselves outside the mill
gates and ask employees who entered to show their duos cards
and union buttons.
according to the SWOC the purpose of these
"dues Inspection lines" was "to remind delinquent members of
their dues arrearages, induce them to meet their obligations to
the union, and finally to demonstrate to active loyal members
the fact that the union is a live functioning organization".^"
It was inevitable, of course, that in some cases workers were
prevented from entering the mill.
One company closed its plant
becuase there were Insufficient employees to carry on operations
lost company executives looked on any picketing as coercion and
thus as a violation of contract.
It was soon found that it was almost as effective to
"talk about" a dues Inspection as actually to form the line,
it was also apparent that management was apt to become far more
II I.
“
-instructions to all sub-regional directors and staff memoers-| Northeastern Region, SWOC. February 5, 1958.
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alarmed by such, talk than ths employees.
inspections, therefore,
by threatening dues
the SV'/OC "put the heat on the compan­
ies" to recognize the dues committeeman system as a convenient
and orderly method of collection of dues inside the plant. As
other alternatives to inspection lines the Sh'GC proposed that
the companies deduct union dues from wages "as an accommodation
and indication of cooperation", that management provide a place
for the union financial secretary "to collect dues on pay days
near the paymaster", or that the company executives, upon re­
ceipt of a list of delinquent members, "impress upon such em­
ployees the necessity for meeting their union financial ob­
ligati ons."•*•
The
S V 'iO C
, it appears, has. decided that management coop­
eration, in some form, is just as necessary to induce workers
to pay their dues as to persuade them to become union members.
The companies, to the degree that they have consented to such
cooperation, have preferred to extend it tacitly and informally
rather than openly through agreement.
For example, U.S. Steel,
after weeks of negotiation with the SWGC in 1939, was willing
formally to recognize dues committeemen provided that the cor­
poration policy permitting dues collections only off plant
property should be publicly stated.
It was indicated, however,
that management would not unduly search out violations of this
IS rule
which were not flagrant.
The SWGC rejected this proposal
sfc T •
If Instructions to sub-regional directors and staff memDers,
Northeastern Region, SV/C-C. January 20, 1939.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
since it would, not improve the recognised status and prestige
of the union in the plants.
Apparently, 'U.S. Steel has not
interfered with the intensive effort to establish dues com­
mitteeman systems in various plants since that time.
In fact,
although no large company had given open recognition to dues
committeemen by the end of 1S39, none had made any determined
effort to prevent dues collections inside toe plants as long
as operations
were not hamoered
therebv.
ia.
v
by the end of 1S3S the SWOC had no check-off agreements
with any sizable steel producing companies.
The SWGC appeared
to be satisfied if management would encourage workers to join
the union and persuade delinquent members to meet their ob­
ligations.
Some SWOC officials have pointed out that the
check-off is not essential if the union shop can be secured.
I They have a l s o •Indicated that periodic collections enable local
officers and dues committeemen to "sell the union" tc the mem­
bership, while the employees might forget about the organization
if the company were the dues collector.
E.
Union-Management Cooperation.
— II ■
■
I
■
II I II
■ ||^ I I .A ■■
I ml
.11 ■
I
■■■■I.
«l
II I I.
Most employers in the steel industry have looked on the
SWOC as a negative force in industrial relations.
The union
has been considered primarily an agency for the redress cf comi
m:
plaints and grievances.
The opposition to the union shop has
been in part predicated on the fear that the S'WOC might sooner
■Si
m
S
Ssit"
or later Impose restrictions on production standards.
iSF
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159
In order to persuade employers to accord complete recog­
nition to the union, the SVsOC published in 1938 a pamphlet out­
lining a union-management cooperation program.'*'
as
At such time
the nosition of the union is secure, it has been proposed
that the local lodges appoint research committees, entirely
separate
from the grievance committees, to cooperate v/ith com­
pany officials in waste elimination, coordination of sales and
production, regularization of employment, elimination of hazard­
ous working conditions, and joint determination of wage and work
standards.
If methods are discovered which result in greater
output with less labor, they are to be applied so that no dis­
charges or lay-offs will be necessary, preferably at a time
v/rien expanding output calls for an increase in employment.
In addition to being distributed to the local lodges, this
handbook has been sent to all companies under contract with the
S'WOC as well as to universities, publishers of business maga­
zines and various employers' organizations.
The purpose has been
to publicize the fact that the leaders of the SWOC are ready to
cooperate with management In the solution of pronuction problems
if and. when the companies are ready to cooperate with the union
in effecting complete organization.
By the end of 1939 the SWOC had established a formal coop­
eration program in a few fabricating companies.
for tne most part
these were marginal high-cost concerns which were forced to take
some drastic action or go out of business.
according to SftOC of­
ficials the steel companies had not yet accepted unionism com­
pletely enough to make such programs practical on a large scale.
Steel workers Organizing Committee, rublicuoj.cn ITo . 2, fro auction
Problems .
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
A.
y;ar;e
Rate Structure In the Steel Industry.
Generally speaking, most production employees in the
steel industry work under tonnage or piece rates, whereas main­
tenance and mechanical workers are usually compensated on an
hourly basis.
The tendency in recent years has been to extend
the incentive or piece rate system to many groups of workers
■vhc were formerly "hourly men".
The -wage structure of the steel
industry' is a maze of individual or group tonnage, piece and
sourly rates, which are not, in many cases, uniform for similar
work in a single plant, to say nothing of the various mills of
different companies.
In one large wire mill, for example, It
nas been estimated that there are over one hundred thousand dif­
ferent rates.
The extremely complicated wage structure is a
result of the wide variety of operations In a steel mill, the
multiplicity of products manufactured, the granting of "per­
sonal rates" to favorites by foremen and superintendents, and
the neglect by management until recent years to undertake any
systematic study of job classifications and rate setting,
also,
•■'ages for the several types of labor within one district have
varied so widely that the prevailing or "going rate" cannot be
defined accurately.
-In 1929 the Arnerican Rolling hill Company began a twoZ
year wags study to bring about some order in the chaos of the
haphazard rate structure in its various plants.
It was first
v
■■
L.
ET
vr
#
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&j
1 4 1 .
necessary to determine the relationship between thousands of
various
joos, and then to group these jobs into
s o m e
t w e n t y
different "zones” depending on the amount of skill required for
successful operation.
’
w ithin the same "zone" all joos were to
receive the same oasic rate of pay, and effort above a normal
day's work was to oe compensated by an incentive wage, separate
from the "zone" rate but proportional to it.
Since there was
found 110 basis for differentials between the various slants be ­
cause of living costs and other outside factors, it was decided
that the wage plan should apply uniformly throughout the cor­
poration.
The plan was instituted in 1952-1933 with the con­
sent and advice of the employees'
"advisory committees".
It
is important to note that the many adjustments in individual
rates required by this plan were effected in connection ’with
general industry-wide wage reductions before the period of in­
tense activity by organized labor groups.
The American Rolling
hill Company, which has no contract with the 3'i/GC, is the only
major steer concern that has Installed a complete scientific
v/age plan*
As competition became increasingly keen In the depres­
sion years, several of the other large companies undertook sys­
tematic studies of job description and evaluation, rate setting,
arid production methods.
The fundamental pre-requisite to scien­
tific rate setting is job evaluation.
This procedure
the rating of a series of major factors which cover all ths
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
cor.citi ons
taat m i l u s n c e the worth of a joo and the referring
of then to a system of numerical equivalents or points.
Each
;u&jor factor is assigned a maximum point value which is deter­
mine-.! through "experience, judgment, experimsn tation and con1
s a l t a t i o n " T h e relative value of~ a joo compared with other
joos is indicated oy the number of point-s.
These numerical
ratings can then be translated to wage rates.
Elthouuh the de­
termination of hourly rates oy this method is relatively simple,
the calculation cf piece or tonnage rates is quite complex. It
is first necessary to estimate what ought to be the normal earn­
ings per hour or day on a particular job.
This is what is meant
by "normal expected earnings", a term frequently appearing in
the contracts.
Incentive rates per ton are then derived from
the estimate of "normal expected earnings".
In some cases a
minimum base or guaranteed hourly rate Is also set below the
expected earnings figure.
This rate is paid even if the worker
fails to "earn" it on the basis cf his tonnage.
Shi'
|;m:.
^ihe major factors and maximum value for each in u.o. Steel are
as folio?; s:
1. Responsibility
2. Skill, dexterity and .accuracy
3. mental Effort
4. Education or dental Development
5. Experience and Training
6. working Conditions
7. Physical Effort
8.~Eatigue
Total
§§
i
240 points
230 points
100 points
100 points
120 points
100 points
60 points
50 points
1000 points
Prom: Joo Evaluation manual for Suosidiary Companies of united
States Stsel Corporation, November 15, 1937*
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1 4 3 .
are used only a a a guide or standard in'rate sett
sary to pay iii.gh.er than L'ue evaluated rat
n orae
or "personal rea­
sons" it may be necessary to leave untouci
certain rat
:iow
negotiation of changes in existing rates, and proposed new rates
v/it.i the representatives of the employees.
Unionists have oeen
•skeptical of the methods used oy management In setting rates.
Unfortunately for most companies, the development of scientific
methods of rate setting has come at a t-dme when labor organiza­
tions are active, and consequently adjustments must be made
through, bilateral rather than unilateral action.
For purposes of study and comparison the only data avail­
able are hourly rates for common labor.
.between 8 and S per cent
of ail steel workers come under this category.
The majority of
the common laborers in the steel industry received in 193*? a
minimum rate of 62-g- cents per hour.
rate in Pittsburgh, Cleveland,
Ohio River districts.
This, was the prevailing
Chicago, Youngstown, Canton, and
In the mastern district, including dew
England, New Jersey, Eastern Pennsylvania,' and h&ryiand, the
average common labor rate was slightly lower.
rates ranged from 36 to 45 cents per hour.-*-
In the South, the
These represent
the principal steel producing and wage rate districts.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Tne
1 4 4 .
.j e o g r & p h i c a l
differentials in common labor rates had become
firmly established and were generally accepted by tie industry
during the Code period.
Steel executives pointed cut, hoy/ever,
that there is very little relation between geographical differ­
entials in common labor rates and differentials in average rates,
1
particularly those pertaining to the higher skilled occupations.
host steel corporations report, and the American iron and
Steel Institute compilesy monthly figures on average hourly earn­
ings for wage earners.
Yiage rates, together with hours schedules
and operating conditions, set the limits of potential wages,
tamings represent the amoungs actually received on the basis
of wage rates for hours spent on the job under actual operating
conditions.
Since employees are primarily Interested in hourly
earnings and since tonnage and piece rate's are usually set with
relation to expected earnings, the data on average hourly earn­
ings reflejlct quite adequately the Increases or decreases in com­
pensation received by employed steel workers.
These data, how­
ever, are not reliable as an index of wage rates, because changes
in methods or the "speed-up" of operations may permit lower piece
or tonnage rates at the same level of hourly earnings.
B.
The G-enerai Level of miage s .
at the beginning of the SWGO campaign in the spring of If 36
the basic common labor rate fox* the Pittsburgh District was 47 cents
^"Because of the nature of the wage structure already descrioed,
it is, of course, impossible to verify or refute tnis statement,
pi:
|p£
IS
Ifep:
It"
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1 4 5 .
per hear.1
Average earnings of anployees receiving hourly,
piecework, or tonnage rates were about 66 cents per hour.
The
pressure of trie unionization drive put employee representatives
in a strategic position to secure the general Increases of
November, 1936, which raised common labor rates to 52y cents
and'average earnings to about 72 cents per hour.
The SV'JCC con­
tinued to press for an additional 10 cent per hour raise for
all classifications and the payment of time-and-one-half for
all work in excess of 40 hours per week.
Consequently, employee
representatives throughout the industry made similar demands.
In Larch, 1937, most of the major companies granted these de­
mands in full, bringing the common laoor rate to 62-y cents per
hour in Pittsburgh and average earnings to aoout 83 cents per
hour throughout the industry.
The increases in labor rates and
average earnings as a result of the 1936 and 1937 raises were
approximately 33 and 29 per cent respectively.
Average hourly
l| earnings reached a level about 30 per cent higher than in 1929.
The wage increases of March, 1937, granted in full the
0
demands initiated by the SMOG shortly after the opening of its
The wage issue, according to the SbOC, had been a sub2
ject of discussion in the laylor-Lewis meetings.'
aim the major
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
M
c+G-1
Lata on wage rates and earnings were furnished to the writer
by the American Iron and Steel Institute. Differentials exist
between the common labor rates in the various geographical dis­
tricts of the steel industry.
The Pittsburgh rate represents
the higher level paid by most of the principal companies. Chan
in the Pittsburgh rate are tvoical of changes in other distric
Interview.
Philip Murray, Chairman, Syy'GC.
li )
drive.
1 4 6 .
steel corporations, however, announced the general increases
ut the same time.
The independents made such concessions os-
tensioly in response to demands by employee representatives,
in an effort to'take the wind cut of the sails of the 31GC
drive.
This time, hew ev er, the policy cf killing the union
through concessions to the employees failed.
U.S. Steel recog­
nized the union and included the wage
—’ increases in its a^reeo
went with the 3./0C.
Section 3 of the Carnegie-Illinois contract
provided that effective march IS, 1937, there should oe an in­
crease of 10 cents an hour in hourly rates, which would set the
common labor rate in Pittsburgh at 62/ cents, and an equivalent
increase in all tonnage and piecework rates which should net
under "normal expected earnings" an increase of not less than
80 cents per day of 8 hours or 10 cents per h o u r T h o s e
com­
panies which recognized the SVvOC in suosequent months stated
in their contracts that on march 16, 1937, "there was an in­
crease of wages" and that these wages as increased prior to the
negotiation of the contract should continue in effect during
the life of the agreement.
The "little steel" companies, cf
course, had set similar standards in accordance with the indus­
try-wide action.
1
Tae text of Section 3 follows:
-.
"Section_5 - VhiGES . Effective harch 16, 1937, there snail be
I" an increase in wages of ten (10/) cents an hour on all rates
which are at present Four Dollars and twenty cents (yd.20} a
hay, or a minimum for this classification of Five (y>5.00) Dollars
a day of eight (8) hours.
Such classification now receiving less
tn&n Four Dollars and twenty cents (y4.20) a day or less than fift;
two and one-half cents (52M
per hour shall be increased ten (10/)
cents per hour. There shall be an increase of ten (10/) cents per
-our in all other hourly rates, and an equivalent increase in all
tonnage and piece-work rates which will net under normal expected
earnings an increase of not less than eighty (80/) cents per day
°f eight (8) hours."
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
147,
iis m d i c a t e a in Chapter X j_X , the maintenance of the gen­
eral level cf wages was the principal issue in periodic informal
negotiations between officers
|
the ShGC during 1938.
of U.3. Steel and. the
In the face of
leaders of
proposals by "big steel"
for cutting wages, the SVJoC took a firm stand to prevent "the
downward spiral of wages" that might follow such action.
The
|| independents, apparently, did not assume'the initiative in proy posing wage reductions•
|
.nevertheless, in 1939, although common labor rates and
| average hourly earnings had been maintained at the highest levels
in history,
\
total monthly payrolls In the steel Industry for
I
I comparable periods of production were no larger than in 1936 bo-
i
| fore wage increases were granted. Employment in man-hours had
<lS
H been reduced, a result of organizational and technological labor§ saving improvements, which, although planned long before the
H
period of intense unionization, were beginning to beax- fruit on
\i
H a large scale in 1938 and 1939.
Employed steel workers were en-
„ joying higher earnings, but only at the.expense of displaced empii
§| ployees.^ The perplexing problem o f •technological unemployment
< has been outside of the scope of collective bargaining.
The
|r ShOC has sought to control this situation through legislative
tw>r;
J§
.
2
I?,, aCoivj.ty •
ms
W
i'
| 1
II for analysis of production, payroll, and employment data see
appendix "B".
cSee Chapter iSf.
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C.
Adjustment of Individual and C-roup Rates,
1.
Inequalities.
Section 11 of the Carnegie-Illinois agreement states,
"S're re alleged Inequalities in wage rates prevail the matter
may be taken up for local plant adjustment, and settlement
made on a mutually satisfactory basis."-*-
As indicated above,
the wage rate structure In the steel industry involved many
inequalities.
SV/OC committeemen and officers were quick to
discover that certain union members were receiving inequitably
low rates.
At first management raised a large number of rates
which were clearly "out of line".
It was soon apparent, how­
ever, that, unless the general level of wages was to be increased
by such adjustments, certain Inequitably high rates would have to
be reduced correspondingly.
The SV/OC resisted any attempts to
lower rates of union workmen, and the companies were not willing
to lower the wages of non-union employees.
In some plants, man­
agement attempted to meet the union’s demand for an increase of
a low rate with a request for a
decrease in a high one.
The net
result has been that?after the companies had given as many In­
creases as they thought possible, the wage rate structure has
tended to become "frozen".
i/lost companies tnat were attempting
to re-set rates on the basis of joo evaluation nave seen forced
to postpone any drastic revisions until such time, pernaps, as
another imove
general Increase might be effected largely
iiW V ^ for a 0
^--n interpretative agreement supplementary to tno 193o contract
provides that such cases cannot oe appealeu to an umpire.
'
StI
&!
i
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149.
through relative upward adjustments of individual rates.
c o m p an ie s ,
Other
which had not undertaken systematic ways and job
studies, have been skeptical of the practical value of initiat­
ing such programs I n view of this situation.
2. Changes in methods.
Of greater consequence, however. Is the process of setting
rates in response to changes of equipment, processes, materials,
routine duties, or production requirements.
In such cases the
old rate- becomes obsolete, and a new rate must be established.
Since the re was no clause In the 1937 contracts which specifi­
er
f
I
II
W
fe
|
!|
I-
cally dealt with such situations, many corporation executives
took the view at first that, since Section 8 affirmed the cornT' !
pany’s rights of management and direction of the working forces,
the company had exclusive authority to set the new rates without
negotiationwith
the
union committees.
of mills, theinstallation
With the consolidation
of newequipment,
tion of Improved production methods,
and the
Introduc­
the companies were inclined
H to set new hourly and piece rates on their own initiative, leavH ing it up to the union to protest such rates, If It cared to do
ff-P
g so, by filing grievances on behalf of Its members. Strenuously
objecting to this practice, the SWGC took the position that the
companies had no right to set new rates without prior negotia­
tion with the union committees.
were
The top officials of the S,«GC
agreeable to lowering piece or tonnage rates In accord
Ig. with technological Improvements on a mutually satisfactory basis
Sit
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v/ere net reduce'! thereby.
of
nevertheless, the "aroitrary action ii
c.20:1611I in setting such rates without negotiation was
deemed a determined effort to oreah the union.
There was aypre—
ueusion on tr:e part of union officers that the comcanies v/ere
attempting to cut individual and group rates as a means of low­
ering the general level of wages,'thus "chiselling" on the con­
tract.
E
The unilateral action of management in setting new rates
therefore, soon created an issue in many plants which drove more
workers into the union.
**
In the face of great opposition on the part cf operating
|f and engineering executives, most of the contract companies had,
: by the end of 1939, consented, to dlscuss proposed new rates with
h the union prior to installation.
The Wheeling Steel Corporation
agreed to such a procedure in the 1938 contract.
Jones and
to Laughlin reached an understanding with the union through negotia
tions within the "general joint c o n f e r e n c e " T h e
Carnegie-
lilinois Steel Corporation decided that, inasmuch as the union
was the bargaining agency only for its members, all employees
M
affected, union or non-union, as well as the Sw'GC grievance comm
** nitteamen should be consulted on such changes.
my the end of 10
the principal U.S. Steel subsidiaries had adopted the same
ifii
pci
ir>
Thus, on rate change cases there is provision fop individual as
well as collective bargaining, although the union connitteenen
ft lo
See page
/ & * { .
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1 5 1 .
hav: goneraj.ly assured leadership in the negotia ticns .“
--fter
discus sion, the new rates are generally put in for a two or
thrvs month trial, following which negotiations may be resumed
if necessary.
O
typical rate case night oc as follows.
group of
work'srs huve been paid 10 cents per 100 pounds production on a
given operation and their "normal expected earnings" have been
vl.00 per hour.
In other words, they have been expected to
produce ’at least 1,000 pounds per hour.
line company makes some
improvements in the equipment sc that each worker should pro­
duce 1,250 pounds per hour under similar operating conditions.
the management decides that the extra effort required should
entitle the workers to a "normal expected earnings" rate of
vl.05 per hour.
Thus they propose that the rate per 100 pounds
be reduced from 10 cents to 8.4 cents.
The union produces evi­
dence to show that average earnings under the old set-up were
actually v1.25 per hour, but that under the nev/ set-up, because
of the increased speed of expected operations, it would be impossiole to average ever ^1.10 per hour at the nev; rates proposed
enter a contract recognising a union as the oargaining agent
only for its members, the company is free to onryain with other
employees in any manner it chooses.
Thus Carnegie-11linois dis­
cusses proposed rate changes with all employees who may be af­
fected. There is no way of knowing, in advance, who are 'union
aemosrs and who are not. The union committeeman, nevertheless,
is recognized as the1bargaining agent for union memoers. in
some cases, however, it may be possiole that no union members
are affected by the change.
In this case there may be o&rgaining with individuals.
*lhe description given here is a composite cf major issues set
g&. forth in four leading rate cases In three separate companies.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
::-:pect-:-d e a r n i n g s "
no tv;' t n s t u n o x u g ,
result
tne unio:; c o n t e n d s
th a t
t nc c o n t r a r y
to
tie nev; r a t e s v;c ulc
in a cut cf 15 c e n t s i n n e a r l y e a r n i n g s ,
workers
saould
ut l e a s t
receive
as m u c h
as
a rate
they had
which
would
oecn able
tc
that
enable
them
before
the
the
to m a k e
c h a n g e v;a
r.ade .
the company then argues that it. is entitled to a "retur
cii -vho j.iivt;o
"L'
in tuO no
c cjiijjiifSnt •
iho
\x n
ion conn x . 0ns
that the company will secure its return on the increased ton­
nage [.reduced per lean in that some no rile rs may oe displaced,
uoth parties may then introduce data on compensation for com­
parable operations in other plants in the vicinity.
is a fina
inducement to the union to accept its proposed rates, trie com­
pany ray produce figures tc show that its financial position i
poor or that it is losing its proportionate share cf business
to competitors who pay lower wages.
In answer to such conten­
tions the union usually criticizes the sales and marketing
methods of the company.
Some sort of a compromise settlement
is usually effected.
.although most companies have agreed that nev; wago rates
v/ill not become effective until after conference with the em­
ployees and the union representative, they are under no coliga
tion _to secure approval of their action by the union.
_n prac
tice, however, the companies that negotiate changes have rarel
ma
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
lo o .
3st re.; ra^es w j . i/Lcut approvt-1, sine, cnn'jos
a u v o
not boon sis.de
looo t;.o company spokesoeo hove convince:; tie union treat
•^ 1
tie ip ccmeiiiicas nave oeret«
-.^unugomcnt officials have pointed,
out t: at t.ue procedure, altrough makin.";
f
op
more hcimnious re­
latione with trie union, has discouraged to some extent the in­
troduction cf new methods and equipment because of the antici­
pated difficulty cf securing the 'onion's consent to wage rate
reductions.
In those companies where competitive conditions
have made mandatory improvements and consequent wage cuts the
problem of negotiating rate adjustments has become very acute,
ror example, the American Steel and Vi!ire Company, a b . S . Steel
suosidiary, has a higher level of wage rates than most cf its
competitors.
At the same time, its competitors have been the
leaders In Introduction cf nev; machinery.
American Steel and
Wire, therefore, has undertaken a large-scale prograin of modern­
isation cf its plants, necessitating the setting cf thousands of
new rates as a consequence of changes in processes and methods.
Since In nearly every case reductions from former rates were in­
volved, the company attempted to set the nev; rates without con­
sultation with the union.
my the fall cf 1939, however, rela­
tions with the union had strained.
The company decided to
negotiate the new rates probably, among other reasons, tc avoid
In some companies, however, which have not until recently followe'
the policy7 of conferring with the union In advance, many nev; rates
nave oeen
set which have been opposed by the union. in such cases
tae union
has filed grievances demanding not only a re-settxng of
tae rates
but also back wages from the time the new rates were set
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
serious labor disturbances.
Such a procedure would
o e
bound
tc slow up cr limit the realization of the economies cont erapla ted
tarough modemij?.ation of the plants.
She adjustment of individual and group wave rates has been
a vital issue for both the SWGC and the companies.
because of
the maze of rates in steel plants, it has been impossible to set
forth a wage scale in the contracts.
At first the companies
wero reluctant tc surrender to the union any control over the
[ setting
cf rates.
Company estimates of "normal expected earn­
ings" have carried little weight with unionists who are seeking
to limit the "arbitrary" action cf management in formulation cf
rates and work standards.
The main difficulties, it appears,
have centered about the process of rate determination rather
than the actual "speed-ups" or adjustments involved.
up to the
end of 1959 the SYjGC had been so preoccupied with winning the
right to bargain on rates that it had found little time to evolve
or formulate a wage policy.
The rate problem in the steel indus­
try, however, is bound to be dominant in collective bargaining
relationships in the future.
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gj£
y.j.
The "seniority" clauses, as worded in the standard con­
tracts, merely reaffirm what the companies have claimed -was
their former stated policy wit!., respect to promotions and lay­
offs.
ijxtn tae acivent of collective bargainim.. relations yjlth
the S'.VOC, however, it became apparent that actual practice was
often at variance with stated policy.
In the administration of
the contracts the local unions have now secured partial control
of the formulation and interpretation of company employment
policies.
a.
i
Jorl:-Sha r1 ng ♦
Curtailment of operations in times of slack business neces­
sitates either the reduction of weekly hours of plant operation,
thereby spreading available work among the same number of em­
ployees, or the lay-off of part of the working force.
In prac­
tice these two methods may be combined in a variety of ways, and
both are usually applied In a period of severe business recession.
Although the standard contract of 1937 mentions several factors
which shall govern the increase or decrease of forces, no specific
reference Is made to work-sharing.
This matter has oeen, for the
most part, a subject for informal discussion between local plant
management and representatives of the employee s*^- There is no
m
The Wheeling Steel Corporation, however, reached a company-wide
understanding In 193S with officials of the S.sGC regarding ser . v i 1 ■Uf*
This understanding, in the form of a supplementary agreement, outlines a general rule calling for work-sharing down to twenty-four
sours per week*
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
fc.
I
156,
gencraj. rule c c n c e r n m g wcrk-snarIng In tie steel industry as
ci v/tiole.
In some plants the local unions have insisted on work|
sharing, even down to one day per week, instead of the lay-off
of any workers.
In such cases, the active union members are
apt tc be employees of relatively short service.
In a few
plants, on the ether hand, older groups of union members have
g. insisted that the short service workers be laid off In prefer­
ence to general sharing of work among all employees.
4
In most
cases, however, management has proposed, and the local unions
§f have agreed, that work be shared when slack periods are appari
§| ently temporary. When there was no assurance that such a cons
dition was temporary, consideration has been given to a force
ff li
| reduction.
During the recession of 1937-38, it was common,
J| waen weekly hours per worker fell below twenty-four in a de-
■
:
jh partment, to lay off enough workers to provide 30 or more hours
H per week for the remaining employees.
f
t
l| workers have
Sib''
~
Apparently, most steel
*
felt that it Is better for short service workers
jfi,
k tc secure state unemployment insurance or WPA joos than to com5
yd
SfclV: '
§1 pel the entire force to "share the starvation" by working less
fe‘
\
►
H than three full days a week.
From the point of view cf local
|| union leaders It becomes feasible tc lay off a minority of short
jpVft
H service union workers whenever work-sbaring seriously Inconveniences
the majority of members.
H
It is
n e v e r
practical, however, to lay off
the majority of the force so that available work may be shared oy a
fe minority.
In considering these questions it has been necessary also
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
157,
tc recognize that an extended, period cf lap-off map result in
permanent loss of seniority, vacation and pension righto by
toe furloughed workers.
iae policy of local unions with resoect to work-sharina;.
O“
consequently, has been determined in large measure bp the dis­
tribution within various departments cf union and non-union
workers and the average service record of the majority of mem­
bers in the union.
The objective in many cases has been to
press for that procedure which will benefit the dominant group
of union members at the expense of the largest group of non­
union employees.
In general management has opposed any plan
that would discriminate in fact against non-union workers.
b . Seniority and Competency in Promotion
and Increase or Decrease of Forces.
The standard contract in broad terms provides that se­
niority, or preference in employment based on length of service,
is only one of several factors to be considered in promotion
1
and lay-off or reemployment of the working forces.
If knowl­
edge, training, ability, skill and efficiency, physical fitness,
family status and place of residence are relatively equal, length
of service is the governing factor.
2
In practice family status
■n-ccording tc most of the provisions of the contracts, the seniority
principle applies tc ■promotions and lay-offs alike, no distinction
being made between the two.
In practice, however, the number of
promotions Is small compared with the number of employees laic off
||- aud re-hired.
o
___
Tae test of Section 6 cf the Carnegie-xllinois agreement Is as
follows:
"it is understood and agreed, however, that in ail cases of promo­
tion, or Increase, or decrease of forces, the following factors snail
be considered, and where factors (b), (c)., (d), and (e) are rela­
tively equal, length cf continuous service shall govern.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
ar.i pla.ce of
residence
oem g
enpnasis
c omp ete ncy or
This
subject
to
ficials.
,~i r.i C'<
merit
"flexible
The
, r-
4-
of
interpretations
c o r p o r a t i o n is
~
^
the c o m p a n y
^
In
to
short,
ous s e r v i c e
ployees
as
and
a
"joint
to be d i v i d e d
|f tions p r e c e d e
R
g§ employees
the
into
groups
oy g r o u p s
of r e l a t i v e
has r e a c h e d
the
are c o n s i d e r e d
ranks
II
II
II
II
11
(a)
(b)
(c)
(d)
(e)
lines
-
j
merit
In
to
job
in
the
competency
disappear,
when
in
the
sa me
a
labor,
of
force
who
Demo-
classifications,
demoted
the
next
process
all
when
of
are
level,
the
then
lower
rate?
elimination
th is
demoted
on
procedure
employees
o t h e r u n s k i l l e d l a o o r In
x-t t hi s
em­
department are
are
out.
of
of c o n t i n u ­
as w o r k m e n .
on
—
deter­
individuals
skilled
carried
of u n s k i l l e d
as
demoted employees
the
.
among groups
employees
ana
•
tae r i g h t
merit
length
able w o r k m e n
Th e
->
asserts
that all
the h i g h e s t
demoted,
been
negotiated
- .»>
as w o r k m e n .
skilled
least
^
basis of
factor only
coll ect ive ly' w i t h
and d e p a r t m e n t a l
‘ -.i / • . / “ «
on the
seniority-
t h e y are
o
based on ability
considered c o l l e c t i v e l y w i t h
joo tc w h i c h
_
recognition
highest
has
uLie biiiu ana. t n e wiieemu" ooeei
J_ i_
it p r o v i d e s
g r o u p of
oasis of d e p a r t m e n t
interpretation"
interpretation
gives
so-called,
to a l l p l a n t s
this
lay-offs.
In the
various
applicable
jr>
eq ua l
is n e c e s s a r y ,
are q u a l i f i e d f o r
the
company o f ­
J
the d e t e r m i n i n g
o f rel at iv el y'
reduction
to
m a jor
by union and
understanding
promote workers
mined b y m a n a g e m e n t
attention,
seniority provision",
vjj i/Liu -L-o^-i-uncii uiiire ox
>>
little
seniority with relation
only written
Corpor at io n.
|
on
received
factors.
a variety
of a l a r g e
T
placed
have
lay-offs
the prant,
are
L e n g t h o f cont i n u c u s s e r v i c e .
k n o w ! e d g e , t ra I n i n e , a b i l i t y , s k i l l a n d e f f i c i e n c y .
P h y s i c a l f i t n e ss .
f a m i l y s t a t u s ; nuinc Su? of d e p e n d e n t s , etc.
P l a c e " o f r e s i d .ence."
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
tc
oe ...a-•c from tae group of least able workmen on tae basis
cf
clout seniority.^
according tc this interpretation, management retains a
l&r r measure cf discretion in selecting employees for rroraotion, demotion or lay-off, provided that this is not used for
the purpose of discriminating against union members.
The union,
of course, may challenge management's determination cf merit in
individual cases.
in i a c t , the re have been actual instances in­
volving lay-offs where grievance committsemen have demanded that
a short service employee, whom the union claimed to be more com­
petent, be retained rather than a longer service man who was
considered less competent.
In these instances,
it should, be
added, the committeemen were presenting the cases of union mem­
bers against non-union workers.
an agreement similar to that with wheeling Steel would
probably meet with the hearty approval of most company execu­
tives.
It also has the approval of at least one SuGC regional
director who Indicated that he was opposed to rigid or straight
SSn'ior>1 t v
.
f»*
— * — v-
e
— '-n
—
t h s
n
r>rm«
r»
^
_ _
r><=»
_
_ —! a t d
j,
n r t R ‘h d O
cr e.tvi
" man
“a O
“t,~ ”
w*• i t h
hfi
pointed out, a strong union should be able to protect its mem­
bers by building up effective grievance machinery to cneck fa­
voritism, bias, or discrimination where these may exist.
He
went on to explain that the nature of production in a steel mill,
with Its hundreds of different operations and jobs, make* any rigic
Interpretation and application of seniority section of uarca I,
193S.agreement between wheeling Steel Corporation ana Steel worker
Organizing Committee, as mutually agreed upon ...arch 23, 1 S 3 9 .
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
I
160
•tion of
the
tie st. n d p o i n t
fan/
of m a n a g e m e n t
local
r.cuncc :1 tee
seniority p
r i n c i p l e xmprac
i m p r a c ttu
i ccax
al i
i-isiiCj.pj.ti
oct:i i r o m
union
procedure
and
t h e union.-*-
leaders,
set f o r t h
in
leaving t h e d o o r
open
part cf f o r e m e n ,
thereby removing
prcvi'e 1 i:i c l a u s e s
l\
'*n.
-
Scale a n d F o l i c y
with tho
Others
ly d e t e r m i n e
vice w a s
overruled
than e q u a l i t y
ticn o v e r
for
management
that. Is
status
■''interview.
6iiuc.
is
considered
the
ste ol
govern
in
favoritism
to a r i g i d ,
union
can
so
ou t o f
often
insecure.
C l i n t o n S.
the
sense
Golden ,
se r
lay-offs.
hos
the opinion
this
feeling
in e m p l o y m e n t
v er y
part, of
little
local
of weakness
is
by
a _large d e g r e e o f
exert
the
length cf
clear-cut formula.
ha s
joint
of s u f f i c i e n c y rather
characteristic
Since
' J .-■>
40
connection with
apparently of
Fundamentally,
seniority pn
grown
ar e
management
<-> '1
1 0 . 1
union and management
o n the basis
eliminate
local
straighthas
aised
in
+-•?
u i u i
expressed dissatisfaction
an d
merit,
tiierefox-e,
o
demotions,
to
v/hicn a
v
in promotions,
to a d h e r e
letoruination of
4- >.
o n u
when
competence.
a desire
ing m a n a g e m e n t
that
4-/->.
u \_/
the
to l e n g t h of
of w o r k e r s
should
cf
be
o ^ > r 4 - ’
»-» v _ / A a O
on
as
job p r o t e c t i o n
and merit
unionists
that s e n i o r i t y
demand
demanded
basic
consideraticn
n r . c
to
h a n d , h a v e d e-
of d i s c r i m i n a t i o n
the
in 1937
factors
competency
rank-and-file
based o n
-,if n
Corimittee
qualifying
seniority.
P
a
other
the. W h e e l i n g a g r e e m e n t
sorts
giving first
■ m n f h . o y i
-A
--
f o r all
on th e
In
h o rtheastern
cf
the
discre
control.
Ik
officers,
in d e a l i n g wi
of a u n i o n w h o s e
the m e t h o d
for e
application
Hegicnai
rec
of
director,
kb*
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
151,
seniority'
sion,
uns
it i s
oeer. g e n e r a l l y
the v i e w p o i n t
greatest i n f l u e n c e
of l-hii,
given
most
of
cases
employees b e c a u s e
of
ha s
In other
between m e r i t
and
difficult
had,
up
had
th e
hard
to
tc
the
end
principle
demotion,
in
th e
and lay-off.
to
find .
In
the
retain long service
Is o f t e n
Secondly,
has
discus­
respect.
seniority
not
plant
that
experience,
to d e t e r m i n e
depenciaoillty,
positive
the
correlation
companies
and measure
have
relative
found
com­
p a r t i c u l a r l y a m o n g u n s k i l l e d or s e m i - s k i l l e d w o r k e r s ,
actual
length
demonstrate
to
union
the
a r e of
a
oasic
companies w i s h e d
operation
and
that
or
the d e m a n d
of l a y - o f f ,
competency,
of
th e
but
f in p o s s l o l v S O
union
also
It has
been necessary
e m p l o y e e ’s d e f i c i e n c i e s
outstanding nature.
promote
tha t
services
It h a s
determine
In
that
has
almost
if
su­
to th e
consideration
not
for
ef­
Impossible,
of precise
been forced
the
they
competency among
seniority govern,
of
proven
essential
been
the a b s e n c e
the r i g h t o f
to 9 0 p e r c e n t
are
relative
management
Likewise,
have
to
in other
outstanding workers,
such employees
plant.
common laborers.
determining
an
their
o f the
tc m e a s u r e
groups as
service,
that
to s h o w
perior a b i l i t y a n d
however,
of
to r e t a i n o r
oeer. o b l i g e d
ficient
greater
w o rds, t h e r e
to o v e r r u l e
have
this
been willing
seniority.
local
companies
t e n d e n c y is
their
and l o y a l t y .
factors
in
of p r o m o t i o n ,
first p l a c e , m a n a g e m e n t
petency,
the
fop
officers
policy
cf
e x p l a n a t i o n of t h i s
it e x t r e m e l y
local
ruai i e u p h a s i s to the
largo m a j o r i t y
ll.o
of
on u n i o n
In p r a c t i c e ,
a matter
such
means
to a c c e d e
only
of
to
the o r d e r
advancement
cases.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
162 •
if:
In o r d e r
man/ c o m p a n i e s
plans.
-
on
or mo re
introduced
of
his
his
work.
within
discrimination and
employee
to
as
Is
In
ability
rating
rates
who
this
limits
checked
are
are
checked
presumably,
human
completion
to a n
the
as p o s s i b l e
of obje c t i v e
by h i s
and
by one
again
and uniform
generally entitled
of
familiar with
manner,
After
each
cooperation,
ratings
unbiased
suggestions
competency,
foreman
then
force
favoritism.
is
the
several
the
or
versatility,
manager.
is m a d e
to p r e v e n t ,
and
The
merit
of
quality and quantity
supervisory
employees
of his r e c o r d
as
the
personnel
each
such
measure
sort
initial rating
oy the
rating,
this
The
and
plant
formal
initiative,
the e m p l o y e e
ment,
of
characteristics
members
in o r d e r
an objective
schemes
fitness.
ra ting o f
judg­
of
the
examination
supervisor
to
improve
standing*
By
th e
r a t in gs a s
lay-offs
sequent
|
have
dependability,
physical
|
obtain
Under most
employee
work,
tc
use as
a
and
lack
sole
moreover,
end o f
guide
1939
several
to d e t s r m i n a t i o n
The n e w n e s s
of
inherent
precision
determinants
appeared
to
be
of
solely
the
that, w o u l d
to
complete
lay-offs.
Local
prestige
and membership
w or ke rs ,
"Your
job
competency.
of
in
control
officers,
Local
plan
hands
the
reference
and
union
that
their
leaders,
would
companies
to
could not
on management
to
con­
leave
of m anagement,
struggling
their unions,
security depends
with
employee
system prevented
any
by
using
the schemes
In the
of
merit
lead
of
skeptical
of
and
of merit
promotions.
the m e a s u r e m e n t
tions
companies were
of
for
promo­
build
s a y to
up
the
steel
d i s c r e t i o n as
;g^Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
It
i
163.
f--'
to your ability."
The international officers of the
S«vGC
have
r/arned that any attempt tc set up merit rating systems without
consultation with and cooperation from employees and their
chosen representatives might result in an insurrection cf the
rank-and-file against "nigh-handed and arbitrary" tactics of
wanagernent.
It has been further indicated by
S»VOC
spokesmen
that continued resistance to the union's demand for complete
recognition might forestall the acceptance of a merit system
by organized labor for fear that it might be used to discrimi-! n&te against
union members.
|I«
°
i>
G. Calculation and Application of Seniority Rights.
Seniority rights are based on the continuous service
record of the employee.
Loss of seniority rights may come as
a result of a break in the service record In such Instances as
voluntary resignation, discharge, or absence exceeding S months
to two years by reason of lay-off or disability.
These service
credit rules have been generally formulated by the employer as
; part of the company's stated labor policy.
The principal dis-
I puts between management and the local unions on this score has
i centered about the length of period of lay-off which should
constitute a break in service.
I
The unions have contended that
the prevalence of long periods of slack employment in the steel
i industry should entitle employees to at least one and preferably
| two years of lay-off without loss of seniority rights for re| employment.
Several companies have limited this period to six
I or nine months.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
164,
To the extent that length of service should, govern job
a
security, seniority should logically be applied on/plant-wide
oasis, the senior employee being retained regardless of de­
partment , occupational group, job, or shift.
It is apparent,
however, that the diversity of jobs and.skills in a steel mill
make plant-wide application impractical.
For this reason, de­
partmental seniority has been most common in the steel industry.
In other words length of service acquired in the department
rather than in the plant determines seniority rights^because
the types of work and skills required in each department are
different.
It has been generally understood that if an em­
ployee, on his own volition, secures transfer to a new depart­
ment, he must start there at the bottom of the seniority list.
If, on the other hand, the company transfers him, he usually
retains seniority rights accumulated in his former department.
In spite of Its practical advantages, departmental seni­
ority may become unduly restrictive and discriminatory.
If
operations in one department are slack while operations in others
*
arc normal, long service men in the slack department may be un­
employed while shorter service men are retained elsewhere In the
plant,
an anomalous situation "where ten and fifteen year service
men are on the streets while one and two year men are fully em­
ployed constitutes a serious problem to union officers who are
attempting to convince the membership that seniority is a
guarantee of job security.
Such situations become even more
difficult to handle when a department is shut down permanently
thus causing the loss of seniority rights of all displaced em­
ployees .
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
,
The application of seniority rights has been a very
thorny issue for most union leaders.
Cognizant of the com­
plexities and unavoidable "grief” involved in situations of
this kind,
the international officers of the SWOC have been
unwilling to take a concerted stand on the matter.
Because
of the wide diversity of conditions in different plants, trie
Sh'OC has very wisely left it up to the local leaders to wrestle
with this problem.
The permanent displacement of "hot mill" workers as a
result of the introduction of continuous rolling mills has
H given unionists many seniority "headaches".
In one company
mgif' such displaced workers were transferred in accordance with
plant seniority to jobs they could perform in other departiaents without loss of service credits.
m
Such a procedure in-
volved the "bumping" or displacement of shorter service era-'
ployees in these departments by the former hot mill workers.
f| It so happened that .the hot mill workers had been strongly
Ph
I unionized while several other departments were predominapffof^
non-union.
As these latter departments became unionized, how-
pb.
ever, the local officers soon took the position that, since
7
they had gained all they could by plant seniority, they could
probably secure and hold more union inembef’s by insisting on
straight department seniority.
Excessive transfers and cumber-
He some "bumping" are often more annoying to the workers than they
U are costly to management.
In practice, therefore, the union of
pf
g| ficers have been compelled to press for that type of seniority
M
0$' 1
f which will satisfy the strongest pressure groups in the lodge.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
In another company neither management nor the union v:as
I;'-:
r;.: r
willing to give plant seniority rights to displaced hot mill
8“
workers.
I
An agreement was worked out providing that employees
laid off because of permanent elimination of jobs would be
given first consideration according to qualifications before
hiring anyone from the outside in the other departments.
Such
employees, however, would start at the bottom of the seniority
rosters in the departments in which they were placed.
In this
case the permanent loss of seniority rights was compensated by
certain preference rights in new hiring.
By the end of' 1939
nearly all of the hot mill employees had been recalled on this
oasis.
It Is the difficulty of finding a propel’ basis for ap­
plication of seniority rights in the steel industry that has
caused many SWOC representatives to favor flexible seniority
provisions rather than detailed or rigid rules in agreements
with employers.
It was believed, in general, that seniority
problems could be settled best as they arise through joint con­
ference If there were the proper type of union-m.anagern.ent rela­
tions.
As in the case of setting new rates, the main interest
of union leaders has centered about the procedure of determining
policies.
'Where management has oeen willing to discuss proposals
for promotions or lay-offs with the union committee prior to tak­
ing action, there has been very little difference of opinion, on
the whole, regarding the principles to be followed.
Attempts at
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
one-sided
action by management, on the other hand, have caused
local unions to press for rigid, seniority regulations as a
means of limiting company control of employment policies.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
XII.
h.
MISCELLANSOUS CONTRACT PROVISIONS
Aours.
In 1919 steel employees worked on an average nearly 70
hours a week.
by 1929 the average had dropped to aoout 55 hours.
Curtailed operations during the depression kept hours below 40
a week until April, 1956.
In response to demands from employee
representatives for the basic 40 hour week with overtime pay of
time-and-one-half the major
companies announced in the
summer
cf 1936 that overtime would
be paid for work in excess
of 48
hours per week.
The SWOC and employee representatives continued
to press for the 40 hour week until it was conceded throughout
the industry in March, 1937.
Like the wags increases of 1937
the 40 hour week was "negotiated" by the independents with their
employee representatives and was at the same time included in
the U.S. Steel agreements.■*•
In general it was provided that time-
and-one-half should oe paid for all overtime in excess cf 8 hours
in any one day or for all overtime in excess
of 40 hours in any
one week.^
p The ..alsh-Healey Act stipulates that U.S. Government contracts
| be awarded only to companies that pay time-and-one-half for all
Jg work in excess of 40 hours per week on such contracts. The exp" istence of this act, therefore, probably had great Influence on
H the establishment of the 40 hour week in the steel Industry.
^Section 4 of the Carnegie-Illinois agreement reads as follov.rs :
i, "Section-4 - hours of Work. Effective March 16, 1957, there
g shall be established an eight (8) hour day and a forty (40) hour
week. Time and one-half shall be paid for all overtimein excess
J| of eight (8) hours in any one day or for all overtime in excess
jr of forty (40) hours in any one 'week.
!| "a day may be a calendar day or any 24-hour period, and a week
gp may he a calendar week or any five (5) regular 8-hour turns on
ja consecutive days, followed by a 48-hour rest period, at the op­
tion of the Corporation,
fe, "an employee, who is a member of the Union,.shall not be paid
$H both dallv ana weekly overtime for the same hours so w o m e u .
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Although, average hours worked were over 41 in April,
1537, they have not been as high, as 40 since that time.
& :•
h:-;
m
The
number of workers was increased slightly from hay to August,
1S37, to avoid payment of overtime.
On the whole, however,
the effects of hours limitations on operations have been minor.
There have been some differences between the companies
and the SWOC concerning the application of the calendar week.
The contracts provide that "a week may be a calendar week or
any five^-.'regular 8-hour turns on consecutive days, followed by
sfe a 48-nour rest period, at the option of the Corporation . The
Wl
SWOC has contended that the company has the option either of
I
| scheduling the shifts so that 8-hour turns on five consecutive
It "calendar days followed by a 48-hour rest period will constitute
g".’
a week, or of using the five regular 8-hour turns on consecu­
tive days followed by a 48-hour rest period, or a combination
of the two methods.
The SWOC has stated, however, that any
%
gf time worked on the sixth day under either of these arrangements
should be paid the overtime rate and that in any case there must
be a continuous 48-riour rest period.
m
Some companies, on the
other hand, have contended that, in the event the calendar week
is chosen, there need not be a 48-hour rest pei’icd.
Therefore,
they hold that no overtime should be paid for the sixth consecu­
tive day of work if less than 40 hours have been worked in the
calendar week.
Thus they hold that management may reserve the
right to stagger the work in a calendar week, and that time
worked need net be on consecutive days.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
The SWOC, apparently, was not anxious to make an issue
of t.ois question during the period cf business recession.
With­
out altering its oasic position, it has postponed action until
such time as new agreements are negotiated.
With the upturn
of business in 1S39, however, many local unions were pressing
for adjustment of this matter.
b. Safety and Health.
Section 10 of the standard contract provides that "the
Corporation shall continue to make reasonable provisions for
the safety and health of its employees at the plant during their
hours of employment".
In effect this provision merely gives
formal recognition to the safety and health programs that the
companies had adopted in the past and to which the employee rep­
resentatives had devoted a good deal of time.
There has been very little controversy concerning this
I provision.
Since 1907 the accident hazard, as measured by the
tf’
I number cf accidents for each million man-hours worked,9 has
p
dropped about 90 per cent, and the trend is toward a still better
4 safety record.
In 1934 steel stood twelfth among thirty major
industries in relative freedom from accidents; by 1938 it had
advanced to third place.^
v
Perhaps the principal interest of the union in the safety
icy
; and health provision is in connection with the setting of new
;
■
_
CL
,
I wage rates.
m one case, at least, tfe*© grievance committee nas
^American Iron and Steel Institute, Safety in Steel, page 5.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
argued that a change In production which requires unreasonable
intensification of effort Is a violation of contract in that it
endangers the health of the workers.
0.
Vacations and Holidays.
All of the large steel corporations had granted vacations
with pay to hourly, tonnage and piece workers before the begin­
ning of the SWOC organization campaign.
Existing vacation pro­
visions were incorporated in the standard contract! of 1937 with
the major companies.-*-
The SWOC has been successful, however,
in securing vacations for plant workers through negotiations
with the smaller steel and fabricating companies which had not
previously granted them.
The union committees have also seen
that members take full benefit of their, rights to vacations, and
several cases involving the question of eligibility for vacations
have been presented to management.
Because vacations or equiva-
t§ lent pay are prized very highly by steel workers, it seems quite
i
|c|. certain that the SWOC will sooner or later press for more liber:_____________________________
| allzed plans.
The standard agreements set aside Independence Day, Labor
hay, and. Christmas during which there shall be no regular pro­
duction work.
In one company quite a controversy arose out of
the refusal of men to work on such holidays unless paid overtime
[T rates.
The- two questions at issue have been: which operations
|§ are excluded from the category of
5
"regular*
production work", and
^Ths large companies under contract with SWOC grant one week’s
vacation to employees with service of five or more years.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
does the contract imply that time-and-one-half should he paid
for regular production work on specified holidays?^
f. Lanagement Rights«
Section 8 of the standard contract reads as follows:
"the management of the works' and the direction of the working
forces, including the right to hire, suspend or discharge for
proper1 cause, or transfer, and the right to relieve employees
from duty because of lack of work, or for other legitimate rea­
sons is vested exclusively in the Corporation: Provided that
this will not be used for purposes of discrimination against
* any member of the Union."
It is this right that management has
pointed to in refusing to negotiate new wage rates and in declin
l|. ing to discuss proposed promotions or lay-offs with representa: tives of the union.
l
The desire to preserve management preroga-
tives in accordance ’
with the stipulations of this provision has
| in many cases limited the procedure under the contracts to re\
dress of complaints and grievances.
Union spokesmen have con-
f tended that a too "legalistic" Interpretation of this clause
j&\
p contravenes the intent and purpose of the parties that the agree
ment "promote and improve industrial and economic relationships
|- between those employees who are members of the Union and the
Corporation".
However, the most common complaint by the union
is that the__ company in practice has so exerted its prerogatives
as to discriminate against union members.
■'’The standard contract makes no specific reference to overtime
pay on holidays.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
The Status of Foremen.
E
Section 1 excludes from jurisdiction of the contract
foremen, assistant foremen or supervisors in charge of any
p classes of labor, watchmen, and all salaried employees.
There
p;
ft has been some difficulty In several companies regarding the
definition of a foreman and the extent to which foremen and
|| supervisors should be allowed to displace regular plant workers
in times of slack operations.
The companies have maintained
i that they have a right to determine which persons are members
%
IS of the supervisory staff and to retain such persons, even if
1
|| it
Is necessary to displace regular workers, on the grounds
ft
that they are the company's most valuable employees.
The union
i has contended
that,inasmuch as foremen don't come under theconfS
^
fS
f tract, they have no right to displace regular production men on
I*.*.
j§ regularly scheduled work.
There has been no objection to allow-
£ in.p; foremen to do production work as long as they don't displace
H regular employees.
1
After several months of negotiation a satisfactory settle­
ment of tiiis question was reached in 1939 between the SVi/OC and
f"1 the Jones and Laughlin Steel Corporation.
The company defined
i
| a. foreman or assistant foreman as a supervisor who directs and
is in charge of the working force.
It was agreed that whenever
foremen or assistant,foremen were retained on duty for supervi­
sion (at foreman or assistant foreman rates), the company should
| have the right to keep these men gainfully employed and to utilize
their time to best advantage at any needed work, provided, however,
pl§R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
that such supervisors should not displace a regular employee
L. for an entire turn. Following a 90-day trial of this procedure,
r
H both company and union spokesmen agreed to extend it indefinitely
%
P
■ on an informal basis although no written agreement was drawn up.
Management officials pointed out that this company went further
than other large steel corporations in making concessions to the
I union on this score.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
XIII.
A.
THE AEJdSTIuBHl CF GRIEVAX CES
Procedures Set Forth in the Standard Contract.
Because of the distinction made between union and non­
union workers the liability for disputes under the steel con­
tracts Is probably greater than under agreements granting the
union complete recognition.
Both employers and union leaders
are agreed that Section 7 of the standard contract, which provides for adjustment of grievances, is, next to recognition,
the most important clause of the standard contract.
Like the
other provisions, Section 7 merely suggests or outlines general
principles.
The actual operation of the grievance machinery
has been dependent on informal understandings developed as both
sides have become more experienced in the art of collective bar­
gaining.
It is first provided that should difference arise between
the company and the union over the application or interpretation
i
| of the agreement, there shall be no suspension of work.
Any dif-
| ferences or grievances are to be taken up in sequence between the
|T
following parties:
[
I
Step one:
the employee and the foreman of his de­
partment .
Step two:
a member or members of the grievance com­
mittee and the foreman or superintendent
of the department.
I
Step three: a member or members of the grievance com­
mittee and the general -works manager (or
general superintendent) or his designated
representative•
Step four:
a representative of the national office
of the SWOC and the executives of the
company.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
176.
.■ailing settlement in these four steps, it is provided, that unV'
settled differences wshall then be appealed to an impartial um­
pire to be appointed by mutual agreement of the Corporation and
bcie Union”.
In each plant the grievance committee may consist of not
Less than three nor more than ten members, all of whom must be
employees of the plant.
Such employees are afforded time off
without pay to transact legitimate business of the union.'*'
•The full text of Section 7 of the Carnegie-Illinois agreement
.s as f ollows :
"SECTION 7 - ADJUSTMENT OF GRIEVANCES.
Should difference arise
>etween the Corporation and the Union o p its members employed by
;he Corporation as to the meaning and application of the provilions of this Agreement, or should any local trouble of any kind
Lrise in any plant, there shall be no suspension of work on acicunt of such differences but an earnest effort shall be made to
lettle such differences immediately in the following manner:
"First,
between the aggrieved employee, who is a
member of the Union, and the Foreman of the
department involved;
"Second,
between a member or members of the Grievance
Committee, designated by the Union, and the
Foreman and Superintendent of the Department;
"Third,
between a member or members of the Grievance
Committee, designated by the Union, and the
General Superintendent or manager of the plant;
"Fourth,
between the Representatives of the National
organization of the Union and the Representa­
tives of the Executives of the Corporation;
and
"Fifth,
in the event the dispute shall not have been
satisfactorily settled, the matter shall then
be appealed to an impartial umpire to be ap­
pointed by mutual agreement of the parties
hereto.
The decision of the umpire shall be
final.
The expense and salary incident to
the services of the umpire shall be paid jointly
by the Corporation and the Union.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Discharge cases are covered in a separate clause.
This
clause provides that such cases shall come under the regular
procedure for adjustment of grievances.
I
pa.
In the event it should
be decided that an injustice has been done an employee, he must
§
"Specified periods shall be agreed upon between the
ance
Committee
and the General Superintendent or Manager of each
§!
plant for the presentation of grievances hereunder.
Provided,
however, that matters pertaining to discharges or other matters
g) that cannot reasonably be delayed until the time of the next regu­
lar meeting may be presented at any time In accordance with the
1 foreoging provisions.
"The Grievance Committee for each plant shall consist of
not less than three employees of that plant, and not more than
ten (10) such employees, designated by the Union, who will be
afforded such time off, without pay, as may be required.
"First,
to attend regularly scheduled committee meet­
ings , and
"Second,
to attend meetings pertaining to discharges
or other matters which cannot reasonably be
delayed until the time of the next regular
meeting.
"Third,
any member of the Grievance Committee shall
have the right to visit departments other than
his own at ail reasonable times for the pur­
pose of transacting the legitimate business of
the Grievance Committee,'after notice to and
p e m i s s i o n from his department superintendent
or his designated representative.
"The actual number of members of the Grievance Committee
at each plant shall be mutually agreed upon oetween the General
Superintendent or Manager of the Plant and the union, and in no
case shall there be more than one member In any department."
4The term "Corporation" refers to the Carnegie-IIlinois Steel
Corporation, not U;S. Steel Corporation.)
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
be reinstated and compensated at his regular rate of pay for
time lost.
However, it is specifically provided that all dis­
charge cases shall be taken up and disposed of within 5 days
from the date of discharge.^"
The procedure set forth in the SWOC contracts with re­
spect to the sequence of steps for attempted settlement is in
many particulars similar to that formerly established under
the employee representation plans.
between one step and the next.
There are no time limits
Steps one, two, and three are
j§ almost identical to those in the ERP procedure.
somewhat different.
Step four is
Under the representation plans, any mat­
ters not adjusted with the plant manager could be referred to
a plant committee on appeals.^
If no settlement was reached
on a plant basis, the matter was referred to the chief execu­
tive of the company.
The plant appeals committee step is
•'■Section 9 of the Carnegie-Illinois contract reads as follows:
'‘SECTION 9 - DISCHARGE CASES. In the event a member of the
Union shall be discharged from his employment from and after
the date hereof, and he believes he has been unjustly dealt
with, such discharge shall constitute a case arising under the
method of adjusting grievances herein provided. In the event
it should be decided under the rules of this Agreement that an
injustice has been dealt the employee with regard to the dis­
charge, the Corporation shall reinstate such employee and pay
full compensation at the employee’s regular rate for the time
lost. All such cases of discharge shall be taken up and dis­
JUKposed of within five (5) days from the date of discharge.”
^Such committees might be composed exclusively of employee
representatives or of equal numbers of employee and management
representatives. In the latter case, they were called “joint
committees". Although many plans provided for "joint committees"
employees’ committees became more common in practice.
mSSf
it
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
eliminated under the SWOC contract.
Instead, the grievance
committee refers the matter to the SWOC national office whose
representatives in turn may meet with the executives of the
corporation.
The representation plans provided that an un­
settled dispute at this stage ''may be referred" to an arbitra­
tor if the president of the company and the majority of employee
members of the appeals committee "agree to such a reference".
Thus the procedure allowed the employer to decline to submit a
particular case to an umpire.
it
The SWOC contracts specify that
unsettled cases "shall" be appealed to an umpire.
However,
I the employer might block arbitration indefinitely under this
procedure also, by refusing to reach "mutual agreement" on an
arbitrator.
Finally, the specific time limit in discharge
cases which is made In the union agreements was not general in
employee representation plans.
The representation plans provided for designation of
representatives, one for every 50 to 500 employees depending
on the size of the plant.
The so-called "General Body" of a
large plant might have as many as 50 members. In addition to
handling grievances in their respective departments, these em­
ployee representatives commonly served on various subcommittees
such as Appeals, Ytfays and Means, Wages and Working Conditions,
Athletics, Pensions and Employment.
The limitation of the num­
ber of grievance committeemen to 10 to each plant under the
il
union agreements, therefore, was an innovation in the steel
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
industry.
Dues committeemen, designated by the union without
formal recognition by management, have to some extent taken
the place of* the large number of* representatives.
Another im­
portant feature of the SWOC set-up is that grievance committee­
men are paid by the union and not by the company.
B.
Examples of Operation of Grievance Machinery.
The operation of the grievance machinery established in
the contracts has varied greatly in different companies in ac­
cordance with the size of plants and the different types of
personalities involved.
For purposes of illustration the pro­
cedure developed in 4 different companies may be outlined briefly.
m
The main plant of Company ’’A" employs about 5,000 workers.
In 1937 a rank-and-file strike had forced the company to comply
with the demand of the SWOC to sigi a standard contract.
The
local union leaders were definitely the “agitator" rather than
the "negotiator" type.
The company on several occasions at­
tempted to discredit the union.
A rival group of employees tried
W
&
£
19
2<
;:
? to promote an independent union which the SYtfOC claimed was com­
pany-inspired.
Within a few months there had been about 25 sit-
down strikes or department shut-downs.
A climax to a long period
of fighting the company occurred early in 1938 with a "dues in­
te
spection line" which forced the plant to shut down.
The chief
executive of the company and the officers of the SWOC settled the
dispute on the basis that both sides should take a more coopera­
tive attitude.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
The chief executive held a meeting of the superintendents
and ordered them to curb their anti-union feelings.
He put the
general superintendent in charge of labor relations and gave him
orders to cooperate with the union.
The SWOC abolished the
grievance committee, which had never been much more than a
trouble-making body, and appointed a business agent.
For the
next few months the business agent had to handle nearly all the
grievances in the plant.
As time went on, however, shop stewards
were designated for each 30 to 40 men whose function it was to
collect dues inside the plant and to assist the business agent
by keeping a watchful eye on management and settling minor griev­
ances.
There was no specific reference to these changes in the
contract.
They were made, on an informal basis, to meet an un­
usual situation.
This system has since proven to be a fairly effective
method of handling grievances.
An employee may take up a griev­
ance directly with the foreman or, if he prefers, through a shop
steward.
p
The latter alternative is desirable, in the minds of
many unionists, for three reasons.
afraid to approach the foreman.
First, the employee may be
Such a feeling of fear is a
consequence of autocratic and arbitrary practices of foremen
before unionization.
if
Second, the employee may not speak English
well enougja to present his case properly.
Finally, as long as
gg the problem of non-union workers exists, labor leaders are fear­
ful that foremen may ’’kill the men with kindness" in order to
H
"short-circuit" the union.
The shop stewards report all cases
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
not disposed of with the foremen to the department chairman
v/ho attempts settlement with -the superintendent.
Failing
satisfactory disposition at this stage, the business agent
takes the matter up with the general superintendent.
If no
settlement is reached, the case goes before the executive
board of the local lodge which, if It is so disposed, may ap­
peal the matter to the national office of the SWOC for atp
tempted settlement with the executives of the corporation.
Management has indicated that this system Is far su­
perior to a Bhell-raisingH grievance committee, because the
8 business agent has really attempted to settle cases instead
I
| of merely arguing with the company.
On the other hand, it was
pointed out that the business agent brought up a number cf cases
which had no merit.
He has been forced to do so in order to
keep the rank-and-file satisfied and to hold his job.
The SWOC
officials, although opposed to a business agent system in prin­
ciple, agreed to its establishment because of the lack of proper
Ug local union leadership in the plant.
This experience of Company BA.B illustrates the develop­
ment of grievance procedures under very unsatisfactory unionr
management relations.
The anti-union attitude of management
intensified the irresponsibility of the local union leaders.
In order to establish any sort of constructive relationship,
it was necessary for
the company to compel its supervisory
force to take a more
tolerant position and for
don the democracy of
a grievance committeein favor of the more
centralized business
agent system.
the SWOC to aban­
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Company "B" is a very large concern, employing about
100,000
workers in more than 20 plants scattered throughout
the country.
The top officials of the corporation have been
successful to some extent in curbing the anti-union feelings
of the supervisory forces which had prevailed prior to recog­
nition of the SWOC as the bargaining agent for its members.
At the same time, all foremen and superintendents have been
instructed, apparently, not to encourage the union in any way.
By means of a well-integrated industrial relations program,
company executives have encouraged the foremen to settle as
many cases as possible in step one.
"We endeavor to build up
the prestige of our foremen," remarked a top official, "and
to enable them to settle all cases not involving considerable
expenditure or principles."
This procedure was thought to be
far more desirable than that under the former employee repre­
sentation plans which in practice had often "short-circuited"
the foremen.
With a few notable exceptions, in Company B the widely
separated local unions are rather weak and led by men with
neither militancy nor outstanding ability as negotiators. The
contract had been handed to them "on a silver platter" and
keen
there was lacking that sense of unity and accomplishment that
often follows a victorious strike.
On the company side, all step-two cases are put in written
form and copies filed with the plant industrial relations depart­
ment and the office of the Vice-President of Industrial Relations
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
of the corporation.
'The plant industrial relations supervisor
frequently consults v/ith the department foremen and superin­
tendents on the progress of such cases.
If the grievance goes
to step three, he makes a careful investigation of the facts,
and usually discusses the case in detail by letter or telephone
with the Vice-President before meeting with the union committee.
Knowing all the facts as well as the position of top management,
the plant manager and the industrial relations supervisor then
meet with the grievance committee.
| its contention, it
If the union has merit in
is likely that the Vice-President of Indus­
trial Relations has already advised the local plant officers as
to a feasible settlement.
If, in the judgment of top management,
the union has no case, the plant officers are generally assured
that the Vice-President will back up their position if the mat­
ter goes to step four.
On step-four cases the Vice-President,
with a complete record of the case from step two, meets with a
representative of the SYYOC regional office.
On the union side, a local committeeman generally writes
up step-two cases.
Failing settlement at this stage, a griev-
H ance committee, after possible discussion with the local SWOC
mstaff representative, meets with the plant manager and the plant
industrial relations supervisor.
us
If it gets no satisfaction, the
committee then sends a report to the SWOC regional office.
A
representative of the regional office, usually after an Investigan
gg. tion of the facts of the case, then meets with the corporation
Vice-President to attempt settlement of the case in step four.
IB
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Up to July, 1939, there had been a total of 823 cases
taken up in steps two, three, and four.
In 34 per cent of
these cases the corporation had made some concession to the
committee in steps two and three, while 63 per cent of the rep
® quests were denied or withdrawn. Of 64 cases that came to step
four, the corporation denied 62 and compromised two."^
No cases
f had gone to arbitration.
1
The corporation's organization for settlement of griev-
s vi
jjg ances has been superior to that of the SWOC.
Written records
| are more complete and uniformity of policy and procedure is as-
I
| sured through
I
p president.
constant consultation with a corporation vice-
On the other hand, cases have often been prepared
poorly by the grievance committees.
Some merely contain general
accusations, without specific reference to facts such as time,
place and persons involved.
The very poor showing of the SWOC
on step-four cases if partly attributable to such haphazard
methods of the local committees.
Sometimes poorly Informed
concerning the details of negotiations in steps two and three,
the SWOC representatives, upon hearing the facts of the cases
^■The subject matter of these 825 cases was as follows:
Wages
'Working conditions
Hours of Work
ip
37%
10%
16%
Seniority
Discharge
Miscellaneous
22%
3%
12%
In the same period the corporation settled 261 cases with In­
dividual employees. In 44 per cent of these, concessions were
granted, while 55 per cent were refused or withdrawn,.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
from the Vice-President of Industrial Relations, have frequently
found that they had no grounds to stand on in step four.
Finally,
step-four cases have been handled by at least five different SWOC
representatives from two different regions, resulting in a lack
of proper coordination of policy.
The small total number of cases
taken up by the SWOC committees, and the presentation of many
cases by individual employees without resort to the union is evi­
dence of the efficient organization of the company in eliminating
the causes for disputes, and the weakness of SWOC unions in many
of the plants.
Union officials have pointed out that one of the reasons
for the poor showing of the grievance committees has been the
attempt of the corporation to confine Its dealings to plant em­
ployees by excluding SWOC staff members from meetings with manage­
ment in step three.
The SWOC has claimed that the participation
of its staff representatives in grievance committee meetings with
management would result in reaching settlements more easily and
In the more rapid development of competent local committeemen.
Management spokesmen, on the other hand, have pointed out that
the contract does not provide for such participation.
They argue,
further, that the development of competent committeemen is not
encouraged if "outsiders” carry the burden of discussion, and
that such "outsiders?* tend to put on a "show" in meetings with
management for the effect it may have on "lesser luminaries" In
the union.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
It was apparent that in Company "3" the SWOC has done
little more than to "get along" with management without any
major disputes or stoppages.
In the first place, the lack of
effective leadership in many cases has resulted in weak local
lodges.
Secondly, in sharp contrast to the uniformity of pro­
cedure developed by management, there has been divided respon­
sibility and lack of coordination on the part of the different
SWOC representatives who deal with the company.
Finally, the
failure of some local committees to keep adequate records of
cases and to take proper minutes of meetings with management
si
ft has placed the union at a disadvantage 'in dealing with the comti
®;
H pany.
Equally important as the shortcomings on the union side
is the fact that the company has considered collective bargain­
ing as a negative process and has not shown a very cooperative
attitude In helping to develop a more constructive relationship.
^
|
The experience of Company
"C", which employs about 20,000
workers in two large plants, has been quite different.
This com-
m pany shows the same efficiency of organization for settlement of
k
grievances as Company "B", with the added advantage that its two
r
plants are located in one area and thus in closer touch with top
management.
The two local unions, which forced the company to
grant exclusive bargaining rights after a strike in 1937, are
II relatively strong and led by men who, in the judgement of top
|| SWOC officials, possess both militancy and good reason.
The SWOC
staff representative who has charge of the two plants is a man
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
who, in the opinion of management, is both a hard fighter and
a very reaonsable and fair negotiator.
When the contract was signed in 1937, a grievance com­
mittee was set up.
Within a month over 70 grievances piled up
in one plant, none of which had been settled.
The SWOC officials
then'conferred with management and reached an agreement on how
the grievance machinery should operate.
The union appointed 10
"zone committeemen"'*' for each plant, two of which were desig­
nated as "general grievance committeemen11 and became in effect
full-time business agents of the local lodges.
The procedure provides that in the event there has been
no satisfactory settlement of a grievance with the foreman, it
shall be the privilege of the aggrieved employee to take up his
case with the zone committeeman or at the lodge.
The zone com­
mitteeman or one of the general grievance committeemen prepares
a statement of the complaint and presents it to the department
superintendent.
Arrangement is made to discuss this case within
three working days.
As soon as possible the department superin­
tendent gives the general grievance committeeman a written answer.
If there is no settlement at this stage, the general grievance
committeemen may take the case up with the plant Industrial relations manager who represents the general superintendent.
^
If
|| necessary a formal hearing may be conducted at which either side
m-
fMl
is free to call in witnesses, staff representatives, and the ag­
grieved employee or employees as necessary.
m
W
j.iVy<
A record is made of
-i
1The contract allowed a maximum of 10 committeemen. A "zone” may
IS consist of a single large department or a group of closely related
W&. departments which are considered as a unit for purposes of repre­
sentation.
m
£§>'
■f
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
189.
the proceedings.
If no agreement is reached between the general
grievance committeemen and the plant management, the case may
then be appealed to the regional office of the SWOC for settle­
ment with the executives of the company.
Because of the sys­
tematic procedure followed in steps two and three, both the union
and the company have a fairly complete record of the facts when
the case reaches the fourth step®
In the fall of 1938 the S¥fOC suggested that step-four
grievances be referred to a "joint committee on appeals" for at­
tempted settlement before going to the corporation and union ex­
ecutives as provided in the contract.
The company felt that many
pS such grievances should be settled at the plants, but agreed to
the establishment of a "general joint conference" as a "policy
committee".
This committee is composed of the two general griev­
ance committeemen from each plant, an SWOC staff member, the two
plant industrial relations managers, and the director of personnel
relations of the company.
Meeting every month, the committee has
been instrumental in airing views and in reaching agreement on
matters of company-wide concern.
Step-four grievances are dis­
cussed only when similar cases from both plants are being appealed
at the same time.
The committee has been concerned primarily with
those matters that cannot be settled satisfactorily by presenta­
tion of individual grievances.
For example, in 1939 it worked out
understandings concerning the status of foremen, setting of new
wage rates, and reemployment of workers displaced by permanent
elimination of jobs.
In addition, there has been extended dis­
cussion of the dues committeeman systems, check-off arrangements,
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
190,
fI
and
the union shop issue.
The SWOC contracts do not specif­
ically provide for discussions of this sort.
f
Company
tion
The experience of
"C”, however, has shown that more satisfactory opera­
of the grievance machinery may result from such discussions
In the
“general joint conference".
Although the records indicate that the percentage of con­
cessions to the union has been about the same as in Company "BM,
there were four times the number of cases per employee settled
up tc September, 1939, none of which were .brought up outside
the union.
Furthermore, the SWOC secured concessions in 13 out
of 36 step-four cases.
As in Company ”B M, no cases had gone to
arbitration."*"
Both management and union spokesmen expressed satisfac­
tion, in general, with the type and operation of grievance ma­
chinery in Company "C;:.
The success has been largely the result
of a fortunate combination of personalities on both sides.
The
company officials, to some extent, have buried their previous
hatred of outside labor organizations.
The local -union officers
and committeemen have in large measure outgrown their distrust
and suspicion of management.
The decisions made in conference
between both parties have built up certain guides and precedents
Out of 751 cases brought up during a 28 month period, 48 per
I' cent were denied by: the corporation, 29 per cent granted, 12 per
cent explained, 6 per cent withdrawn, and 5 per cent compromised,
The subject matter of cases was as follows:
P
|
Working time
Rates of pay
Crews5 size, duties
38$>
2Z>%
20^
Personal
Discipline
Miscellaneous
10^>
7^
2%
vW.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
which have become an integral part of union-management relation­
ships.
Among the large steel companies, the procedures developed
in Company "C" have come closest to the state of collective bar•" gaining on a factual basis.
Company "D" is one of the "little steel" concerns which
was shut down in the strikes of 1937.
Management has refused to
sign a contract but has been willing to concede the SWOC de_ facto
~
recognition as an active bargaining agency for its members in the
|
main plant which employs about 12,000 workers.
According to the
L policy laid down by the company, the SWOC, or any other organizai- -fcion, first takes up grievances with the foremen, then with the
PL
L department superintendents, then with the superintendent of in­
dustrial relations, and finally with the plant manager.
Failing
settlement at this stage, in accordance with the company’s state­
&
ir&r
ment of policy, the grievance may be referred
to the state Com­
missioner of Labor whose decision is accepted
as final.^ Management
«
iInland Steel Company, To the Employees of Inland Steel Company.
K
July 1, 1937. This statement announcing the settlement of the
strike also quotes an understanding with the Governor of Indiana
It as follows:
.
jf
^
The men will be returned to work without discrimination be­
tween strikers and non-strikers.
Positive assurance that the labor policy as set forth by the
Inland Steel Company in their letter to the Governor of June
26, 1937, and Statement as to labor policy attached thereto,
dated May 25,, 1937, will be carried out.
All grievances which may hereafter arise on labor matters
within the scope of the Statement dated May 25, 1937, will be
settled in the manner outlined in that Statement. If any such
settlement, so arrived at, is unsatisfactory, the Company will
refer the matter to the Commissioner of Labor of the State of
Indiana, and will accept his decision as final."
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
has placed no restrictions on the number of grievance committee­
men or the presence of SWOC staff members in meetings with com­
pany officials.
The company, furthermore, has had no objection
to collection of dues on plant property by dues committeemen as
long as operations are not disrupted thereby.
Foremen and super­
intendents have been ordered not to discriminate in any way
against union members and to cooperate with the grievance com­
mitteemen.
|
Management spokesmen indicated that relations with
the SWOC had been satisfactory under this arrangement.
The union representatives interviewed stated that, in
pa
i#V.
general, the grievance machinery in Company "D" had operated suecessfully.
1
They pointed out that, in those departments where
the union was strong, there were very few grievances.
There
were isolated instances of discrimination, they claimed, in those
departments where the union was weak.
The union officers felt
that management was willing to make concessions whenever it was
necessary to do so in order to avoid serious trouble.
In fact,
the General Manager was accused of trying to build up a reputa­
tion of being fair to the workers in order to convince than that
they did n ’t need a union.
"Mr.________
is~trying to kill our
union with kindness," remarked one SWOC spokesman.
pg
"We wish to
hell h e ’d fight us sometimes; it would help us to strengthen our
2
organization."
On the other hand, the union was thought to be
1 Interviews. Messrs. Fontecchio and Germano of the SWOC staff
in the Chicago district.
2
Interview. Joe Germano, Sub-District Director, SWOC.
ijs'
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
in more strategic position to secure concessions ttian in the
case of companies that had signed contracts, because the union
c o u l d
resort to stoppages of work if settlements were unsatis­
factory.
Furthermore, the scope of the collective bargaining
relationship was not limited by contract* the union could press
the company as far as its strength enabled.
The incentive for
direct action in settlement of grievances was greater also be­
cause of some arbitration awards which were distasteful to the
union.
The experience of Company "D,r indicates that satisfactory
machinery for settlement of grievances may exist in the absence
of a signed agreement, provided that the union is reasonably
strong and that management is willing to instruct its rank-andfile to adopt a non-belligerent attitude.
C. General Comments on Adjustment of Grievances.
As a result of a study covering 25 plants of 10 different
I companies, the writer has come to the conclusion that the suc1 cess or failure of a system for settlement of grievances has
I
| been dependent more on personalities and attitudes than on the
IB
Bg'H; type of procedure that may be set forth in the contracts. This
conclusion has been substantiated by the fact that, in one or
two instances, there has been a better relationship between the
SWOC and-companies■which had refused to sign contracts than has
existed in many corporations which had granted formal recognition.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
IQ/
_L 17
•
Company executives have invariably pointed to the methods
and tactics of "hot-heads" and "radicals" as the main cause of
unsatisfactory union-management relations.
In other cases, man­
agement has spoken of the "intelligent and reasonable" attitude
of certain union leaders which has been responsible for build­
ing up very excellent relations.
Prom the union standpoint, it
is the attitude of superintendents and foremen which is of pri­
mary concern.
As one SWOC executive explained, "It has been our
general experience that we can usually come to fair terms with
the upper strata of management officials.
The trouble encountered
usually grows out of the subordinate officials— foremen, super­
visors, etc.— who often go out of their way to indicate to the
men that it will be to their disadvantage to be identified with
the union.
It seems to take a good deal of time for company
policy formulated at the top to filter down to the lower levels
of supervision!’1 It has not been unusual, therefore, for griev­
ance committees to put uncooperative foremen "on the spot" by
appealing a large number of grievances over their heads to com­
ps pany executives.
Closely allied with personalities of union and management
leadership Is the problem of the insecure status of the SWOC. As
long as the companies continue to protect the interests of non­
H
jjp
IIS
i
union workers while the SWOC is attempting to persuade or coerce
them to join the union, there is bound to be an attitude of dis­
trust on both sides of the motives for action.
The feeling of
1Interview. Clinton S. Golden, Northeastern Regional Director,
SWOC.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
195
a
continual conflict is intensified by a company attitude which
conceives of a union contract as limiting the scope of collec­
tive bargaining and a union attitude which looks upon a contract
as 'h letter of introduction” or opening wedge for broadening the
scope of the relationship.
General speaking, in appealing grievances the local lodges
and the SWOC have lost more cases than they have won.
Such a
situation is the reverse of that formerly prevailing under the
employee representation plans where the representatives were suc­
cessful in securing some concession in- the great majority of cases,
l< The explanation is not hard to find.
In the first place, the ERP
cases generally involved only minor questions concerning working
conditions, whereas the SWOC cases, although fewer in number,
have dealt primarily with more basic issues such as wages or lay­
off and restoration of working forces.
Under the union set-up,
I the foremen have settled more minor cases informally because the
iff
companies have insisted that they assume more responsibility for
fe
>
It'
I
the proper handling of labor relations in their respective departments.
Second, the local unions, faced with the problem of
holding membership in an organization whose recognized status is
insecure, have been forced to appeal many grievances which have
little merit.
H
As one local union officer pointed out, there are
three types of grievance cases.
The first type includes those
cases not covered by contract.
Management may make concessions
on these in the first three steps but never in step four.
The
second comprises those covered by contract but not supported by
Ifi
■
Ipt;
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
196,
proper evidence.
step.
Such cases are seldom won beyond the first
The third group includes those covered by contract and
supported by
evidence.
Management usually settles these be­
fore they go to step four unless company-wide principles are
at stake.-**
A weak lodge with rather poor leadership will sometimes
take up any grievance, irrespective of its merit, and lose out
in nearly every case.
fc
A strong militant lodge may often force
management to make concessions on cases outside the scope of
the contract, although it is seldom successful in winning griev­
ances not supported by evidence.
A well-established lodge will
generally refuse to take up any case until a careful investiga­
tion of the facts indicates that there is substantial support­
ing evidence.
Any matters falling outside the scope of the
contract are generally covered in negotiations for supplementary
agreements rather than through the regular grievance machinery.
Probably three-quarters of the grievances taken up by the
union from 1937 to 1939 have dealt with adjustment of wage rates
and matters concerning distribution of work, seniority, lay-offs,
p
i
US'
and reemployment.
Discharge cases, although important individ2
ually, have been relatively few in number.
Very few cases have gone to arbitration.
There appears to
be a strong inclination on the part of the larger companies to
-*•Interview. Frank Grider, Sub-District Director, SWOC.
^As most of the material on settlement of grievances was given
to the writer in confidence by several employers, the figures
cannot be presented here. The writer, however, assumes respon­
sibility for the statements made above.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
settle their differences directly without resort to arbitrators
who "know nothing about the steel industry".
The SWOC, on the
other hand, has favored prompt arbitration of all unsettled
step-four cases.
The failure of the company and the union to
agree on appointment of an arbitrator on one or two occasions
has induced SWOC officials to recommend the designation of a
permanent umpire in some recent contract negotiations.
Because of the strong centralized control and power of
the SWOC, breakdowns in grievance machinery have resulted in
very few unauthorized strikes.
The SWOC executives have been
very successful in "keeping the lid down" on "indignation com­
mittees" which almost daily come to the regional offices with
sweeping complaints of management practices and criticism of
delay of the SWOC in securing settlement of step-four griev­
ances.
It was apparent from interviews that most of this dif­
ficulty has been the result of the inexperience of local union
leaders and the uncooperative attitude of management rank-andfile.
|f
fi£'
On the other hand, there are indications of certain struc­
tural weaknesses of the grievance machinery.
First, there are
te
few time limits governing the disposition of cases in the various
t
M
steps.
tgf|-
The delay in getting decisions on step-four grievances
has been notable.
In many cases the SWOC-staff representatives
have been too busy with other matters to devote the time neces­
sary for speedy investigation of such cases.
In some instances,
the companies have stalled in making answers.
It has not been
M
S3?
R eproduced with permission o f the copyright owner. Further reproduction prohibited without permission.
uncommon for grievances to remain pending in step four for
several months, only to be referred back to the plant for settle­
ment on the grounds that they should never have gone beyond step
three.
Second, in addition to the possibility of delay in dis­
position of grievances in the various steps, there is the liability
of deadlock in the choice of an umpire.
In fact, up to the end of
1939, the large corporations had successfully avoided arbitration,
either by reaching agreement with the union on a basis of settle_
%
r
ft
ment after long delay or by "stalling” on the appointement of an
I
arbitrator.
Third, the structural organization of the SVfOC has
K' prevented the efficient handling of step-four grievances in the
very large corporations with plants in different localities.
In­
stead of having several regional or sub-regional directors take
up such cases, it would, no doubt, be more practical to place one
man In charge of settling all step-four grievances that arise
throughout the corporation.
In this way the SWOC might attain
the same coordination and uniformity of practice that prevails in
n
the management of these companies.
The SWOC has already estab­
lished this procedure in two large companies and is planning, apm
Wi
fst parently, to extend it to others as soon as management attitudes
$8
and union finances peimit.
Neither the SWOC nor the companies, apparently, have given
mW
much thought to the joint board, or joint committee, method of
dealing with cases that are not settled in the plants.
The
"joint conference", or policy committee, of Company "C" might
gpsv
fpfe'l.'
am
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
be considered as a combination joint board for settlement of
c o r p o r a tion-wide
grievances and a negotiating committee.
Such,
a joint organization would probably contribute to more efficient
and speedy settlement of differences in those companies that
have several plants scattered throughout the country.
I
m
:£'
ji§
m
i
R eproduced with permission o f the copyright owner. Further reproduction prohibited without permission.
XIV.
LABOR RELATIONS WITH UNAFFILIATED ORGANIZATIONS
In 193S the SWOC was not the only bargaining agency for
I steel workers.
There were other organizations meeting regu-
,1 larly with management in some companies which had formal conp tracts with the SWOC and dealing with them on grievances for
I the same class of workers.
In the "little steel" companies
there were several unaffiliated organizations, either employee
H representation plans or membership organizations, which were
!l engaged in presenting grievances to management. Whether these
if
I organizations in "little steel" companies are company-dominated
”1 or not, the fact remains that they are a factor in
the labor re-
I lations pattern in the iron and steel industry.
| A.
I
Structure of Unaffiliated Organizations.
In the Bethlehem, Rational, and American Rolling
Millcom-
£ panies employee representation plans were still in existence at
I the end of 1939.1
After the National Labor Relations Act was
declared constitutional in April, 1937, the companies discon­
tinued financial support and formal encouragement of the plans,
but continued to meet regularly with the elected representatives
to settle grievances and to discuss matters of mutual interest.
These were not employee representation plans In the sense the
term was used before 1935. The by-laws were changed to make
them appear more independent of management. The term "employee
representation plan", however, has continued in usage to describe
a type of grievance machinery rather than a membership organiza­
tion.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
The representatives have raised money to defray small incidental
expenses of the plans "by sponsoring pienie3, parties, raffles,
1
and athletic contests*
Occasionally the representatives have
held general meetings of employees in a particular plant or de2
partment, yet, for the most part, there has been no formal mem­
bership organization in connection with the plans.
Usually ac­
tivities have been confined to individual plants, there being
little communication with or association among different plant
bodies of the same company.
Looking upon plans of the type
found in the Bethlehem Steel Company as company-dominated, the
Labor Board in 1939 ordered Bethlehem to withdraw recognition
from them for purposes of collective bargaining and redress of
‘
i
.
3
| grievances*
The company appealed the order to the courts.
In the Inland, Republic, and Youngstown Sheet and Tube
g companies, the employee representatives were instrumental in
setting up membership associations after the companies withdraw
n
/f
support of the plans. The leaders of these so-called independent
unions engaged outside attorneys to help them formulate by-laws,
^-Sinee the national Labor Relations Act does not prohibit the
employer from conferring with his employees during working hours
without loss of time or pay, the companies paid the representa­
tives for most of the time spent in the meetings. The representa­
tives needed to raise small amounts of money to cover the costs of
printing election ballots and leaflets, stenographic work, atH t o m e y s 1 fees, etc.
Q
Such meetings were not common under the older type of employee
jiff representation plans.
*2
See page 7 6 above.
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and to advise them on legal matters.
The membership has been
composed largely of plant employees including higher skilled
workers who migjat be in line for promotion to foremanship. In
It
some cases non-supervisory clerical and salaried employees have
been encouraged to join.
Officers and department committeemen
have been elected by popular vote of the membership in much the
same way as set forth in by-laws of local SWOC lodges.
Dues
have ranged from 25 to 50 cents per month, generally payable
| four times a year.
Strikes require authorization by at least
| two-thirds of the members voting on the question.
A few of
these associations have been incorporated in order to give a
jg semblance of responsibility and to afford officers limited
liability.
Like the representation plans, the employee associations
§?■ have been established for the most part on a plant basis. SevII
eral organizations may exist in a single company, and their ac­
tivities may be completely independent of one another.
Most of
these organizations in plants of the Republic Steel Corporation
however, have belonged to a federation or central delegate coun
cil which has met periodically with management executives to
if discuss matters of company-wide interest.
Inter-company federa
tions or associations are rare*
The NLRB may; recognize some independent unions in the
smaller companies as bona fide labor organizations.
The Board,
however, ruled that the employee associations In the Republic
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
and Inland mills were company-dominated and ordered management
to sever relations with, them.'*'
3
. Strength and Weakness of Unaffiliated Organizations.
It was apparent in 1939 that there was a substantial
number of workers who were opposed to the "tactics and methods"
of outside labor unions in general and the CIO in particular.
For example, employee representatives at the Weirton Steel Com­
pany have been resentful because of an unsuccessful strike of
£r
Si the
«/
Amalgamated in 1933.
One Weirton employes who had been ac­
tive In the strike explained, "As soon as it was apparent that
If
the strike was a failure, the Amalgamated officers ran out on
r~
us with all the money they had collected and left the workers
empty-handed."
Though few employees would accuse the SWOC of
running out on them, the failure of the "little steel" strikes
of 1937 cost thousands of workers a full month*s pay.
It Is not
surprising, therefore, that certain groups of employeesjusually
those most friendly with the company^have banded together in
"protective associations" to oppose the SWOC and to forestall
the re-occurrence of strikes called b y outside unions.
In the second place, employee representatives in some
companies had been satisfied with the progress made under the
^See Chapter V.
p
Interview. Claude Conway, Weirton Steel Employees Security
League•
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
plans.”
If the SWOC were to liquidate these plans, the in­
fluence and prestige of these representatives might he eliminated.
When the companies were forced to discontinue support of the plans
in 1937, many representatives were advised hy management to form
independent membership organizations.
In several cases, however,
new leaders who were opposed to the former representatives as well
as to the SWOC, got control of the employee associations and set
out to make them “wholly independent” of the companies.
In many
cases the leaders of the unaffiliated organizations, whether rep­
resentation plans or employee associations, took advantage of the
opportunity provided by the Wagner Act to secure more freedom
from company influence or domination.
Moreover, the failure of
the SWOC “little steel" strikes tended to enhance the prestige
of those employee associations which had been active in imple­
menting the back-to-work movement.
As pointed out in the footnote on page
representatives of the
Weirton Steel Company were in part responsible for a general wage
increase in 1934.
The Weirton plan had several unusual features. For example, man­
agement formally agreed to submit all questions of increase or de­
crease of wages to the representatives, and intimated that approval
ty the latter was necessary before action would be taken. Further­
more, Instead of merely paying incidental expenses of the plan as
other companies did, the Weirton Company gave the representatives
fifty cents annually for every employee eligible to vote under the
plan. Thus “dues" paid by the company gave the representatives
about §5,000 a year for operating expenses.
In April', 1937, the company withdrew its financial support. Shortly
thereafter there was set up a membership organization of employees
called the "Security League", the purpose of which was to back up
the employee representation plan and to oppose the SWOC.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Third, in many cases there appeared to be a very close
I and intimate relationship between management and the unaffili| ated groups.^ The "little steel" companies were willing not
| only to bargain with their own employees but also to cooperate
| with them in establishing such labor relations as would make
| outside affiliations unnecessary.
These companies, although
% willing to "meet with" the representatives of outside -unions,
I have made no secret of their opposition to the SWOC before, dur1 ing, and after the labor disturbances of 1937.
Company encour-
| agement and endorsement of unaffiliated employee groups, whether
| direct or implied, has discouraged some workers from joining the
| SWOC and undoubtedly has impelled others to support the indepen| dent groups.
I
Fourth, all of the large "little steel" companies, except
| Bethlehem, have been, perhaps, somewhat more liberal in treatment of their employees than the principal companies under con­
tract with the SWOC.
For instance, hourly earnings in American
Rolling Mill plants have been more than 10 per cent above the
H average for the steel industry.
The vacation plans of the Youngs-
|f town Sheet and Tube, Republic, and
National companies have been
£ far more liberal than those in the principal SWOC contract comS' panies. 2 Some of the most efficiently managed
- and
, prosperous
m
fc
i
■^It should be noted, however, that a similar relationship has ex­
isted between management and the SWOC locals in several small com­
panies that look upon an outside union as -a constructive rather
than a purely negative force in labor relations.
®In 1939 the standard vacation for plant workers in United States
Steel, Jones and Laughlin, Wheeling, and Crucible was five days
for employees with five or more years of service. Youngstown
t e
—
-
-
s
!
S
h
s
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
concerns in the industry are numbered in the "little steel"
group.
Most of the "little steel" companies have been in a
position to match wages and working conditions prevailing in
"big steel", and most of them have been able to make additional
concessions.'*'
"Why should we pay dues to the SYYOC," said the
leader of an employees* group in one of these companies, "when
we have better wages and working conditions than the SWOC con­
tracts provide?"
Finally, the overhead expenses of the unaffiliated organ­
izations are small.
The SWOC locals must contribute 75 per cent
of dues collections for support of the national organization.
The unaffiliatad organizations, on the other hand, retain all
funds collected locally and thus are able to operate on smaller
monthly dues.
For this reason they have been able to "hang on"
with the active support of very few members even in a period of
severe business recession.
In fact, many of them have managed
||f to exist without monthly dues, depending rather on picnics,
| raffles, and other activities to raise money for current expenses,
Sheet and Tube gave an additional five days to employees with ten
p years* service or more. National and Republic also provided longer
jj vacations for employees with more than ten and fifteen years’ service as vjell as shorter vacations for employees with less than five
If years* service.
V xThe favorable financial situation of the National, Inland, and
American Rolling Mill companies in recent years has been attributed
jp to their relatively large capacities in "lig$it products" for which
|g demand has been more active in depression times. These companies,
furthermore, were ahead of their competitors in installing the new
H continuous roiling mills®
Si
iiv^'
nfe
nt.
W2&ic:~
gSfclSJ."
ipF
S
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
The argument that the bargaining power of unaffiliated
groups in a single plant or company must necessarily be weak is
not applicable in the case of steel.
As long as the SWOC es­
tablishes and maintains minimum standards in the contract com­
panies, the independent organizations can press for similar or
more far-reaching concessions from other companies which may
be, perhaps, in better financial condition to make such conces­
sions.
The unaffiliated organizations, therefore, have con­
siderable bargaining power derived from the existence of the
SWOC and the relative profitability of some of the "little steel"
companies.
Nevertheless, the unaffiliated organizations have
inherent weaknesses.
In the first place, lacking means of in­
vestigating wages and working conditions in competing companies,
they are handicapped in pressing for adjustments of individual
or group wage rates.
In the event of a strike, furthermore, they
would be at a disadvantage since they could not count on outside
J| support to help hold their ranks.
Second, their legal status is
p usually uncertain. The NLRB has held that many are subject to
m
company influence. Furthermore, the Board has ruled in the
St
|| American Steel and Wire case that a single plant is not an ap­
propriate bargaining unit in a company operating 12 mills where
r previous collective bargaining had been on the basis of the em­
ployer unit.^
It is almost impossible, therefore, for an inde­
pendent union, even in the absence of evidence of company domination
^-National Labor Relations Board, Matter of American Steel and Wire
Co. and Steel and Wire Workers Protective Association. Case No.
R-556. March 8, 1938.
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
to secure majority representation rights for a single plant of
a large corporation if an international union has had a contract
covering all the company’s plants.
Finally, since the unaffili­
ated groups are not able to count on financial support from the
companies, they are dependent on workers for contributions. Their
leaders must, therefore, constantly demonstrate their ability to
win concessions beyond those the SWOC may secure.
Yet, in spite
of concessions won, the bulk of job-conscious workers apparently
have little interest in paying dues to employee associations. In
fact, many of the unaffiliated groups which had sprung up in the
SWOC contract mills in 1937 soon disappeared.
Even in "little
steel” the SWOC was able to eclipse the "independent" at Inland's
Indiana Harbor plant.
No less so than the SWOC, unaffiliated
organizations must have complete recognition to insure permanent
existence.
Such recognition in most cases is difficult to secure,
for preferential or union shop agreements may be considered un­
fair labor practices if the union is influenced by the employer.
Likewise, the liability is greater for any unaffiliated organiza­
tion which the Board ha£ not recognized as a bona fide union than
for the SWOC.
18s C. Relations with Management.
eT.
The procedure of collective bargaining with unaffiliated
organizations shows both similarity with and contrast to that
with the SWOC.
In the larger companies, the independent organ­
mk
izations have no signed contracts with management, but meet
ft
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
regularly with plant and company officials to settle grievances
and to negotiate on general questions pertaining to wages, hours,
and
working conditions. Some independents in the smaller compan­
ies, however, do have signed contracts w h ich in many respects
are more comprehensive and detailed than the SWOC agreements
Other organizations in plants of SWOC contract companies have a
"letter of recognition" from the works manager, but none of them
have formal, company-wide contracts.
However, in nearly every
III case studied, the main terms of employment have been at least as
| favorable as those set forth in the SWOC agreements.
Adjustments of individual or group wage rates have been
If negotiated b y management with committeemen and the employees afif
fected in much the same manner as under the SWOC contracts.
It
is apparent, however,
have been lowered.
that in the last few years very few rates
In some companies the major modernizations
of mills, resulting in lower piece and tonnage rates for many
workers, were completed prior to 1937 when labor activity became
intensive.
In others, management has refrained from lowering
inequitably high rates "for fear of stirring up labor troubles".
BsfV
For example, in 1939, the Progressive Steel Workers Union n egoti­
ated a signed agreement with the Wisconsin Steel Works of the International Harvester Company recognizing the union as the exclusive
bargaining agency for all employees.
In this contract the company
agreed to discuss with the union proposed changes In wages, to pay
time-and-one-half for work on Sundays and holidays, and to govern
promotions, increase or decrease of working forces on the basis of
I seniority where ability, fitness and skill are suff1 dent to fill the
requirements of a job in an efficient manner.
In these respects,
this contract goes further than the SWOC agreements. Negotiations
for the last contract continued from the fall of 1938 to June, 1939.
ll
|
Jf
^
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210.
Because of the difficulty of negotiating downward adjustments,
the wage rate structure in companies dealing with unaffiliated
organizations has become "frozen” in a similar manner as in the
SWOC companies.
Lay-off and promotion policies in concerns dealing with
unaffiliated organizations have been similar to those followed
by the SWOC companies.
In practice, length of service has been
the governing factor unless there have been clear-cut differences
f
in competency.
Some companies have attempted to retain control
1
!«, over such employment procedures by the development and use of
wg formal merit rating plans.
One company, on the other hand, depi
|| termined jointly with employee representatives the seniority and
%
merit standing of individual workers prior to lay-off or restoraH
w
|| tion of forces, and in some cases went so far as to refer applicants for jobs directly to the representatives.
On the matter of recognition, in 1939 the employee asso­
ciations having contracts with some of the smaller companies were
pressing for the union shop and check-off.
Nearly all the em­
ployee associations in the larger companies wanted some sort of
signed contract and "Majority representation.
They were afraid,
however, to petition the NLRB for elections lest they be out­
lawed as company-dominated unions.
Yet what they lacked in formal
j^te. recognition through a signed contract they gained in Informal en­
couragement by the employers.
In general, management in "little
steel" has looked on collective bargaining with plant employees
as a positive, cooperative process.
Company officials, apparently,
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have left no stones unturned to enhance the prestige of the
leaders of the unaffiliated organizations and to deal with them
on a friendly basis*
The procedures for handling grievances have been very
similar to those set forth in the SWOC contracts.
The unaffili­
ated organizations.seem to have brought up a greater number of
cases than the SWOC committees, and because most of these cases
involved only minor issues, the percentage settled favorably to
F:
j^- the employees has been greater.
In the Republic and 'Weirton
Steel companies, for example, from 1937 to 1939 over two-thirds
of all cases were settled in favor of employees, while in SWOC
contract companies the proportion of such decisions was consider­
ably less than half.
Management, it appears, has been willing
to "go along" with many requests for better wash rooms, drinking
fountains, changes in pay days, and other small conveniences
individually trivial but in the aggregate perhaps costly.
As
one corporation executive expressed it, "We never force our
representatives to go back to their constituents empty-handed.
With the existence of unaffiliated organizations in the
"little steel" concerns, collective bargaining extends to ail
R
P*1
-- major iron and steel companies.
At the end of 1939 the SWOC was
the dominant bargaining agency for about three-fifths of the na­
tion’s steel workers, but it was the foundation of the bargaining
pi
■^Interview. J.A. Voss, Director of Industrial Relations, Republic
Steel Corporation.
pi
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power of all groups of employees in the industry.
In spite of
their opposition to the National Labor Relations Board and the
SWOC, the leaders of the unaffiliated organizations have been
constrained to admit that their strategic position has in many
respects resulted from the existence of these outside forces.
In effect, the unaffiliated organizations are parasites of the
SWOC.
Yet, far from being company-dominated agents or stooges,
as described by the SWOC, many of the leaders of these organi­
zations have been capable and respected men who have taken ad­
*£#>>
vantage of every opportunity to strive for the best bargain
possible for the moment.
Recognizing the possible future bargaining weakness of
isolated company or plant unions in an industry dominated by a
few financially powerful corporations, many of the leaders of
the unaffiliated organizations look forward to some sort of
federation to bargain with the steel companies on a nation-wide
basis.
Such a federation, they say, will be led not by outsiders
but by steel workers, who know, at first-hand, the problems of
their fellow employees.
Meanwhile, the existence of the SY/OC as
a national organization enables the unaffiliated groups to thrive ..
Ur
in a single plant or company, and their incentive to band together
in a federation is thereby minimized.
Lacking coordination and
adequate financial resources, however, there Is an equal possi­
bility that they may be absorbed by the SY/OC or its successor,
particularly If the companies should change their policy of op­
position to outside unions®
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XV.
C O N C L U S IO N
In steel there have been three stages in the evolution
of industrial relations.
to 1933.
The first covered the 30 years prior
During this period steel makers had been free to
formulate labor policies with very little concern for their
impact upon the working forces.
A few companies, which had
set up employee representation plans, demonstrated that a sys­
r
&
tematic procedure for airing grievances and the discussion of
management problems with workers could increase organizational
efficiency.
Most companies, however, neglected to adopt poli­
cies of industrial relations to cope with the human problems
that developed as a result of the increasing size and unwieldi­
ness of mass production operations.
The forced acceptance of group relations brought about
by the passage of the National Industrial Recovery Act in 1933
ushered in the second phase. As a bulwark against outside unions
all the large steel companies set up employee representation plans
These were effective in bringing to light many arbitrary and short
sighted practices on the part of the supervisory forces.
It was
found that education of foremen and yrorkers through company- spon­
sored ’’collective cooperation” could be consistent with sound
business practice.
Yet group relations as a ’’management technique
proved tobe, under these conditions, unstable and transitional,
for some of the plans were ’’captured" by opposing outside forces,
and the representatives became conscious of the bargaining weak­
ness of others.
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214.
The SWOC contracts with "big steel" and the established
legality of the Wagner Act in 193V marked the beginning of a
third stage, that of organization of workers by independent,
outside unions for purposes of collective bargaining.
Hence­
forth, management would be obliged to determine labor policies
in the light of their impact on articulate, and perhaps strongly
organized, groups of workers, with the power to question and to
W
i
obstruct company actions.
This study has been concerned largely
with the analysis of this third stage.
In the first year of Its existence the SWOC created a
"union movement" in steel.
At a time when the combination of
political and economic factors was unusually favorable, the
.1
?
SWOC, backed by large financial resources and capable, farsighted leadership, outmanoeuvered "big steel" by clever strategy.
The employee representation plans in the Carnegie-Illinois Steel
Corporation proved to be an Instrument ready to the hand of the
outside union rather than a bulwark against unionization.
U.S.
Steel was forced to make peace with the SWOC in order to avoid
what would probably have been a very costly strike.
Having provided the pressure to raise wage rates in the
steel Industry to unprecedented heights, the SWOC handed U.S.
Steel employees a signed contract before they had been formed
Into a cohesive ;labor organization.
Capitalizing on the victory
of the Taylor-Lewis agreement, the union was able to force sev­
eral of the independent companies, which were financially too
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weak to battle, to make similar agreements.
Yet the task of
developing local unions with competent leadership and duespaying members had hardly been begun.
The "little steel" strikes
demonstrated that more than a mere movement was necessary to cope
with the determined opposition of a combination of the most pros­
perous producers in the industry®
Following the strikes the movement waned, but the seeds
of organization had been planted deeply enough to withstand a
severe business recession.
The SWOC was able to proclaim that
this was the only major depression during which steel workers
were not forced to take a general cut in wages.
With the revival
of operations in 1939, it was apparent that the SWOC had consoli­
dated its gains by developing a more stable and permanent union
organisation.
panies.
Yet the union is weak in many of the larger com­
As a whole, the local lodges in U.S. Steel are far be­
hind those in the rest of the industry.
The U.S. Steel contract
has become in some respects an impediment.
The path of least
resistance has been to "encircle" the larger corporations by in­
ducing the smaller steel and fabricating companies to grant com?
plete union recognition.
The problem of organizing "little steel" still looms large.
What the SWOC has lacked in formal recognition, it has recovered
j
in some cases by establishing de facto recognition of grievance
committees.
The outcome of the legal attack on "little steel"
is not yet decided.
|
The concentrated organization drive in the
Bethlehem plants, however, indicates that the SWOC is placing
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its main reliance on direct action rather than on governmental
intervention.
After three and one-half years of activity the SWOC now
has contractual relations with companies employing over threefifths of the nation’s steel workers.
In addition it has hun­
dreds of contracts with various steel fabrieating and processing
companies which are closely allied to the steel industry.
The
SWOC has a full-time international staff of 248 persons, and a
;i
force of over 15,000 elected officers and grievance committee­
men who administer the affairs of approximately 1,000 local
lodges.
Originally financed by the United Mine Workers but to­
day self-supporting, the international organization and the local
lodges together spend nearly a million and a half dollars annually
for the purpose of developing an Industrial union of steel workers.
In the steel industry, a minority of employees pay dues to
the SWOC.
%
Yet the membership rolls of this organization minimize
its strength and influence.
Even if only a small minority of
steel woikiers paid dues, the SWOC would probably be able to exist
I
on the contributions of thousands of employees In fabricating and
processing companies, many of which are under what amounts to
union shop contracts.
The political prestige of the CIO in
Washington, the influence of Labor’s Non-Partisan League in state
and local politics, and the immeasurable assistance that has been
afforded by government agencies such as the La Follette Civil
|
Liberties Committee, the National Labor Relations Board, and the
■
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217.
Public Contracts Board
must not be overlooked.
As a focal
point of the whole CIO movement, the SWOC represents a concen­
tration of effort by well-established labor organizations to
create an industrial union of steel workers through both eco­
nomic and political action.
The greatest asset of the SVtfOC,
however, is its capable, experiences! top leadership and the
loyalty and unity which characterize the entire organization.
The SWOC or a successor industrial union is bound to be a per­
manent institution in the labor relations of the steel industry.
Essentially, the SWOC is a provisional administration
rather than an International union.
It Is an organizing com­
mittee in which control and authority are concentrated In the
hands of experienced labor leaders who, nevertheless, are not
steel workers.
The local lodges composed of steel workers, al­
though apparently solidly united in support of the outside
leaders, have not formulated the major policies nor controlled
the administration of the SYfOC.
Although the SWOC was created
for steel workers, It has not been run by steel workers.
1
This type of labor organization is somewhat of an innovation in the field of labor unions.
If the United Mine Workers
had not possessed the financial resources and experienced leader­
ship to carry on a large-scale campaign, steel would probably
never have b.een unionized.
The decadence of the Amalgamated
Association of Iron, Steel and Tin Workers and the collapse of
the insurgent rank-and-file movement within that organization
demonstrated that steel workers could not be organized spontaneously.
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Thus a committee of outsiders was a necessary prerequisite for
unionization.
The result has heen a stable, responsible, yet
comparatively conservative organization which has lacked, in
many respects, the virulence and militancy of a union that has
evolved from an uprising of the rank-and-file.
Progress in
establishing collective bargaining relationships has been slow,
but quite steady and solid.
With the exception of the "little
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After the contracts were signed,
rather than forced at the point of a gun, the large corpora­
tions were persuaded to accept collective bargaining.
Steel
workers did not seethe with enthusiasm for a union; rather they
have been and still are being taught, as in a school, the value
of collective bargaining with employers.
A major SWOC problem
has been to find and train promising steel workers who will be
capable of assuming leadership in the future.
The question
arises as to what kind of leadership will emerge from this care­
fully controlled "hot-house" environment.
In general, it- might be concluded that- management, cer­
tainly in those companies that have contracted with the SWOC,
has become convinced that unions will be a permanent force in
the steel industry.
The formuiation and administration of in­
dustrial relations policy has become a major function of the
top executives.-
The paramount concern of the companies has been
to avoid labor difficulties.
In the larger companies executives
have attempted to eliminate the causes of employee dissatisfaction
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by "cleaning up their back yards".
Looking upon labor rela­
tions with the union only as a part of the broader function of
industrial relations, these companies are striving to achieve
conditions which, will make steel workers both productive and
satisfied.
The union is looked on as an agency through which
employees, if they are so inclined, may present grievances. It
|
is feared as a potential force which might limit the program
of management for greater efficiency and productivity.
Collec­
tive bargaining on major issues such as the setting of rates
has been accepted lukewarmly.
Fundamentally, the large cor­
porations desire a union that is weak.
They have been persuaded
to make concessions to the union in situations where stern re­
sistance would create an organizing issue fraught with potential
labo r di s turbance s.
Top executives of the large companies under contract with
the SWOC have been gravely concerned with the problem of train­
ing operating officers, superintendents and foremen to adapt
themselves to the new relationship.
The days of espionage and
suppression of outside unions have passed.
The union-hating
steel boss must either suppress his emotions or race discharge,
i
The successful boss Is one who is able to avoid labor troubles
without "giving away the company to the union". Management,
consequently, has an incentive to eliminate the causes of griev­
ances, establish a reputation for square dealing with employees,
and maintain in fact as well as in theory an "open door" policy
on hearing of complaints.
Although tenaciously guarding management
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eg
i
220,
"I
j
.1
! prerogatives,
these companies are enhacing the welfare of their
employees by means of more enlightened personnel administration.
By such a policy they are trying to ’’kill the union with kind­
ness1'. in some cases.
Some of the smaller steel companies have been compelled
J to grant the union complete recognition to insure labor peace.
With neither the resources nor the inclination to fight the
battles of the industry, the executives of the small companies
have been willing, in many cases, to free themselves from the
j burden of possible friction between union and non-union employ­
ees in their plants.
The union shop places greater responsibility
on the SWOC for the discipline of its members.
The top leaders of
the SWOC offer management their cooperation in return for complete
acceptance of the union.
Finally, it is these small corporations
which look to a strong labor organization as a possible stabiliz­
ing influence to help them curb destructive price cutting of
dominant corporations.
Management in "little steel" is still strongly opposed to
the principles and tactics of the CIO.
Although they deal with
SWOC grievance committees as an expedient means of avoiding
I
trouble, the "little steel” companies use every subtle means at
their disposal to resist unionization.
Their natural desire to
support employee representation plans and employee associations
is curbed only by the National Labor Relations Act.
Collective
bargaining with their own employees is looked upon as a positive
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cooperative process which goes far beyond the mere adjustment
of grievances.
The "little steel" corporations exhibit the
same improvement in personnel administration as the large union
companies, but their relations with representatives of their em­
ployees are more intimate because of the absence of "outsiders".
Prevented by existing legislation from combatting outside unions,
these companies show an unmistakable desire to sap the strength
of the SV/OC through the opiate of kindness and concessions to
their employees.
To what extent has the growth of the SWOC and the impact
of its pressure on management policy established collective bar­
gaining in the steel industry?
The standard contracts are agree­
ments to have collective bargaining rather than understandings
reached through the process of collective bargaining.
The domi­
nant feature of labor relations in steel during the past few
years has been a struggle for union recognition and the accep­
tance or non-acceptance of collective bargaining.
By the end
of 1939 after a long uphill battle the SWOC had convinced man­
agement that adjustment and setting of individual and group wage
rates should be effected through joint negotiation rather than
by unilateral company action.
More unbiased lay-off and promo­
tion systems had been developed, not as a result of a strict
seniority clause in the contracts, but rather as a consequence
of careful vigilance by both company and union representatives
in seeing that length of service was overruled only by basic and
outstanding ability.
The expectancy offhir treatment of ail steel
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workers has in such matters been greatly enhanced.
Finally,
the establishment of* grievance machinery, more effective in
some companies than in others, is evidence that a continuous
day-to-day relationship has existed between the companies and
the local lodges.
It is apparent, however, that neither management nor
labor has had time to actually test collective bargaining on
its merits.
Joint discussion on matters such as wages, employ­
ment or union-management cooperation has been influenced and
sidetracked at every stage by the continual struggle of the SWOC
for complete recognition and the desire of the companies to keep
the union weak.
source.
Nearly all of the friction has stemmed from this
It is apparent that labor relations in the steel indus­
try will be strained and unstable until the issue of union recog­
nition is settled one way or another.
There are two obstacles to the further development of col­
lective bargaining in steel in the immediate future.
The first
is the relationship in "big steel” that centers about partial
recognition of the union.
The ponderous immobility of U.S. Steel
together with the apparent weakness of a great number of the SWOC
lodges has resulted in a stalemate.
In so far as other large cor­
porations refuse to go further than "big steel”, more complete ac­
ceptance of the union is impeded.
The union shop has been secured
only in the smaller companies whose influence in the industry is
slight.
The SWOC, therefore, must continue to place reliance on
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a slow, educational offensive.
The second obstacle is the ac­
tive resistance of “little steel”.
Often in better financial
position that the SWOC concerns to make concessions, the "little
steel” companies have created an environment which gives encour­
agement to unaffiliated labor organizations, regardless of whether
or not they are company-influenced or controlled.
Major changes in wages and working conditions in steel have
been made through simultaneous action of the major producers. Among
the companies there has always been a substantial degree of uni­
formity in employment policies.
ing, therefore, is industry-wide.
The area of collective bargain­
Although there is little danger
of wage cutting by non-SWOC companies as long as the unaffiliated
organizations derive bargaining strength from pressure of outside
forces, a substantial weakening or the disappearance of the SWOC
would leave steel workers at the mercy of the employers.
A stable
basis for collective bargaining, therefore, is probably dependent
upon the establishment of a strong industry-wide union which might
bargain with an employers' association made up of the dominant pro­
ducers.
Certainly some of the present "little steel" companies
would have to be included in such a group.
Yet whatever the status of the union, certain fundamental
problems are bound to dominate collective bargaining in the future.
Technological improvements and better management methods are not
only necessitating the readjustment of rates but are also displac­
ing hundreds of workers.
The adjustment of existing inequalities
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in the very complex wage structure of most steel companies as
well as the setting of new rates necessitated by changes in
methods are matters which will require extensive negotiation.
The "speed-up" of work resulting from the increased use of in­
centive rates and minor improvements in production methods has
already alarmed union officials who, if they had a stronger or­
ganization, would probably demand joint control over the estab­
lishment- of work -standards.
The determination and control of
lay-off and promotion policies is a vital issue for both the
union and the companies.
The problem of the permanent displacement of workers as
a consequence of both organizational and technological improve­
ments, however, is one that may lie outside the scope of col­
lective bargaining.
The SWOC has not, as yet, attempted to
impede these improvements by direct action.
Declaring that a
main reason for widespread unemployment in the steel industry
is technological change, Philip Murray has proposed that an un­
employment conference of labor, government, and business repre­
sentatives of all industries might solve this and related prob­
lems either through a collective agreement between these groups
to put people back to work or by a coordinated legislative pro­
gram.
This proposal would carry collective bargaining into the
broader field of national problems.
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A P P E N D IX
"A "
AGREEMENT BETWEEN THE CIO AND THE AMALGAMATED ASSOCIATION OF
IRON, STEEL AND TIN 'WORKERS ESTABLISHING THE STEEL WORKERS
ORGAN IZING COLil/IITTEE.
"1. Affiliation. The Amalgamated Association of Iron,
Steel and Tin Workers hereby agrees to affiliate with the Com­
mittee for Industrial Organization.
"2. Steel Workers Organizing; Committee. The Steel Wovrkers Organizing Committee shall be composed of such persons as
are named by the Chairman of the Committee for Industrial Organ­
ization, in accordance with authority granted to him by the Com­
mittee for Industrial Organization. The Steel Workers Organizing
Committee shall consist of a Chairman and Secretary-Treasurer and
such additional members as are deemed necessary by the Chairman
of the Committee for Industrial Organization, two of whom shall
be from the Amalgamated Association of Iron, Steel and Tin Workers.
”3. Powers. The Steel Workers Organizing Committee shall
be a policy committee, to meet periodically at the call of the
Chairman of the Committee as conditions and circumstances warrant.
’’The Steel Workers Organizing Committee shall have power to
handle all matters relative to the organizing campaign, other than
the issuance of charters. The Committee and the officers of the
Amalgamated Association shall have exclusive power to deal with
the steel companies in order to reach agreements, but this shall
not abridge the rights of the Amalgamated Association in the ex­
ecution of current wage agreements.
’’The Amalgamated Association shall not take any action af­
fecting the organizing campaign without first consulting and ob­
taining the sanction of the Chairman of the Committee. The Com­
mittee shall not Interfere with nor attempt to direct the other
duties of the officers of the Amalgamated Association.
"The Steel Workers Organizing Committee may establish such
advisory Comrn.ittees, consisting of representatives of labor or­
ganizations who may contribute funds to the Committee for prosecu­
tion of the campaign.
"4. Finances. The Committee for Industrial Organization
shall contribute such sums of money, up to Five Hundred Thousand
Dollars (§500,000) as conditions of the organizing campaign war­
rant. The disbrusement of funds shall be made by the SecretaryTreasurer, subject to rules promulgated by the Steel Workers Or­
ganizing Committee.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
"5. Dues and Initiation Fees. The Steel Workers Organ­
izing Committee shall have power to grant dispensation from the
payment of initiation fees to all persons joining the Amalgamated
Association during such time as it deems advisable. If the Com­
mittee changes thi3 policy all initiation fees collected shall be
placed in its treasury for campaign purposes.
"Dues shall be fixed at $1.00 monthly per member, and dues
payments shall begin upon a date fixed by the Committee. If
deemed necessary by the Committee money collected as dues shall
be used in the campaign.
"Nothing contained in this paragraph shall abridge the
rights of the Amalgamated Association in its relations with Lodges
now working under wage agreements with employers.
"6. Termination of Campaign. The details incident to the
termination of the campaign of organization and the disbanding of
the Committee shall be within the province of the Steel Workers
Organizing Committee and the Committee for Industrial Organiza­
tion, acting jointly.
For the Committee for
Industrial Organization:
JOHN L. LEWIS, Chairman.
JOHN BROPKY.
PHILIP MURRAY.
THOMAS KENNEDY.
For the Amalgamated Association
of Iron, Steel and Tin Workers:
THOMAS G. GILLIS, Vice Pres.
EDWARD W. MILLER, Vice Pres.
JOSEPH K. GAITHER, Vice Pres.
LOUIS LEONARD, Secy.-Treas.
'Washington, D.C., June 5 , 1936."
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A P P E N D IX
"B "
DISPLACEMENT OP STEEL WORKERS AS A RESULT OF TECHNOLOGICAL AND
ORGANIZATIONAL IMPROVEMENTS.
SWOC spokesmen have pointed out on several occasions that
a large number of steel workers are being permanently displaced
as a result of technological improvonents that-have taken place
in the last few years.1 In collaboration with Mr. H.J. Ruttenberg, Research Director of the SWOC, the writer has been making
a quantitative study of the relationship of production, payrolls
and employment in the steel industry from 1933 to 1939. As this
study was not completed fully at the time of writing (January,
1940), It is not feasible to Include a detailed analysis in this
thesis. Nevertheless, it is possible to give at this time a com­
parison of production, employment and payrolls for two periods of
peak production, namely March through May, 1937, and October
through December, 1939.
During the period from March to May, 1937, the steel industry was enjoying a boom. In these three months, companies re­
porting to the innerican Iron and Steel Institute (representing
over 90 per cent of the production of the industry) produced
15,441,102 gross tons of ingots. They employed an average of
493,797 plant workers (employees receiving hourly, piecework or
tonnage rates exclusive of salaried workers) for a total of
264,767,090 hours, paying them wages totalling $221,707,690. In
the next comparable boom period from October to December, 1939,
the companies reporting to the Institute produced 15,796,937
gross tons of ingots, or about 2 per cent more than in the 1937
boom period. However, the average number of workers employed was
only 464,785, a decline of 29,012 from the 1937 period; total
hours worked were 232,374,564, a decrease of 32,392,526 hours or
12.2 per cent; total wages were $198,033,554, a decrease of
$23,674,136 or 10.7 per cent from the 1937 p e r i o d . 2
3-See Ruttenberg, H.J. ”85,000 Victims of Progress," New Republic,
February 16, 1938; also "The Big Morgue," Survey Graphic. April,
1939.
^These figures wei’e secured from data supplied to the writer by
the American Iron and Steel Institute.
The production of ingots is used as an index of total production.
Ingots are the raw material for all semi-finished and finished
steel products. We have assumed that the relative tonnages of all
finished products for the two periods have been constant. Highly
finished products, of course, require more labor than semi-finished.
Several steel executives Interviewed agreed that the relative ton­
nages of different products had probably not changed sufficiently
from the first period to the second to affect employment materially
in this respect*
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
Pending refinements of this analysis, we may make a few
assertions concerning employment and payrolls. First, for com­
parable periods of peak production, there has been a substantial
decline in employment of plant workers, as measured both by the
number of workers employed and the total number of hours actu­
ally worked. Second, coincident with this decline has been a
reduction of total payrolls, or, expressed in other terms, a
lowering of labor costs. The reduction in payrolls has offset
to a large extent the wage increases that were granted as a re­
sult of pressure by the SWOC in 1936 and 1937. Thus, while em­
ployed steel workers are enjoying higher hourly rates and, in
most cases, greater weekly earnings, the problem of the unem­
ployed steel workers has been aggravated.
Having shown quantitatively that there probably has been
permanent displacement of workers, it is necessary to analyze
the causes. Workers may be displaced because of installation
of labor-saving machinery, or because of organizational improve­
ments which increase their output, or by a combination of the
two. In the past few years the pace of technological improve­
ments In the steel industry has been very rapid. In addition
to the construction of new continuous rolling mills, other very
important changes have been made. The size of open hearths has
been increased making possible a substantial increase in output
with very little increase in labor. Continuous drawing machines
have eliminated many jobs in wire mills. In these and other im­
provements the steel industry invested.almost a billion dollars
in the five-year period from 1935 to 1939. Nearly three-fourths
of this amount was spent in the years 1935, 1936 and 1937.1 It
is not surprising, therefore, that economies resulting from such
improvements should be realized in 1938 and 1939.
Coincident with technological improvements there have been
notable organizational changes which have increased the produc­
tivity of labor. The industrial engineering departments have
been studying and recommending better production methods which
have eliminated one or two workers here and there over a wide
range of operations. Personnel departments have developed more
careful systems of selection and training of employees. Although
it is impossible to estimate the number of workers displaced be­
cause of these measures, steel executives are agreed that organ­
izational improvements have been perhaps, as important a factor
as technological changes In effecting savings in labor costs.
3-American lion and Steel Institute, Dollars Behind Steel, New York,
1939.
1
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
SOURCES OF MATERIAL
A.
Interviews
Most of the material for this study has been secured
through interviews with steel corporation officials,
labor leaders, and workmen.
In all, approximately two
hundred and fifty persons were interviewed, some of them
many times, during the years 1937, 1938 and 1939.
Per­
sons in the following organizations were contacted.
Allegheny-Ludlum Steel Company
Amalgamated Association of Iron, Steel and Tin
Workers of America
Arner i can Er idg e Gomp any
American Iron and Steel Institute
American Rolling Mill' Company
American Steel and Wire Company
Association of Steel-'Employees
Bethlehem Steel Corporation
Carnegle-Illinols Steel Corporation
Crucible Steel Company of America
Elliott Company
Inland Steel Company
Jones and Laughlin Steel Corporation
Jessop Steel Company
' McKeesport Tin Flate Company
National Labor Relations Board,
Division of Economic Research
National Steel Corporation
R eproduced with permission o f the copyright owner. Further reproduction prohibited without permission.
XI
national Tube Company
national Union of Steel Workers
Otis Steel Company
Pittsburgh. Steel Company
Progressive Steel Workers Union
Republic Steel Corporation
Sharon Steel Company
Steel Employees Independent Labor Organization
Steel Workers Independent Union, Inc.
%
Steel Workers Organizing Committee
Steel Workers Union of America
Timken Roller Bearing Company
United States Steel Corporation (New Jersey)
United States Steel Corporation of Delaware
Weirton Steel Company
Weirton Steel Employees Security League
Wheeling
Steel Corporation
Youngstown Sheet and Tube Company
The writer is particularly indebted to the following
persons for continued interest and assistance during the
preparation of this study:
D.A. Barrett, Vice President in Charge of Industrial
Relations, Carnegie-Illinois Steel Corporation
Meyer Bernstein, SWOC staff
Earl Blank, Director of Personnel Relations, Jones
and Laughlin Steel Corporation
B.ii. Brock, Assistant Director of Industrial Relations,
United States Steel Corporation of Delaware
R eproduced with permission o f the copyright owner. Further reproduction prohibited without permission.
I I
Grover Brown, American Iron and Steel Institute
Thomas Brown, Carnegie-Illinois Steel Corporation
Philip Clowes, SWOC staff
Roy Dye, Jones and Laughlin Steel Corporation
Paul Passer, SWOC staff
Prank Fer-nbaeh, SWOC staff
George Fonda, Director of Industrial Relations,
'Weirton Steel Company
Nicholas Pontecchio, SWOC staff
Clinton S. Golden, northeastern Regional Director, SWOC
E.W. ICempton, Director of Industrial Relations, American
Steel and Wire Company
John Lever, SWOC staff
David J. McDonald, Secretary-Treasurer, SWOC
Philip Murray, Chairman, SWOC
Harold Ruttenberg, Research Director, SWOC
John A. Stephens, Director of Industrial Relations,
United States Steel Corporation of Delaware
VIn Sweeney, Publicity Director, SWOC
J.A. Voss, Director of Industrial Relations, Republic
Steel Corporation
B.
Selected Bibliography
(*' Indicates unpublished memoranda In typewritten, min
graph or printed form)
Amalgamated Journal, various issues.
American Federation of nabor, proceedings. Fifty-fifth
Annual Convention, 1935.
American Federation of Labor Weekly Hews Service,
'‘Organization Plan for the Steel Industry Outlined
by Green,” May 15, 1936.
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
1
iv
American Iron and Steel Institute, Annual S t a t i s ti ca l
Reports, various years, New York.
Collective Bargaining in the Steel Industry, New
York, 1934.
Directory of the Iron and Steel Works
States and Canada, New Yrork, 1938.
o f
the United
Dollars Behind Steel, New York, 1S39.
Half a Million Men, New York, 1933.
Safety in Steel, New York, 1939.
Statement of Arthur H. Young, Vice President,
U.S. Steel Corporation, before Senate Committee
on Education and Labor, Hearings on Wagner Bill,
April 5, 1934.
-^Statistics on employee representation plans fur­
nished on request.
Steel Facts, various Issues.
-"*Wage and employment data furnished on request.
-Where Does Steel Stand, Ne
York, 1936.
Baker, Helen. The Determination and Administration of
Industrial Relations Policies, Industrial Relations
Section, Princeton University, 1939.
Bethlehem Steel Company, Plan of Employees1 Representa­
tion at the Bethlehem Plant, Adopted January, 1920,
as amended to September 6, 1935.
'“’Employees Re-presentation, January, 1919.
---- "Bethlehem Steel Plan Aids Company and Men," Re­
printed from New York Times, September 11, 1927.
Bethlehem Review, various issues.
Carnegie-Illinois Steel Corporation, *x*Transcripts of
testimony presented by employee representatives
before the National Labor Relations Board, January
11 to February 20, 1937.
---'Minutes of various meetings of employee representa­
tives.
'"'Merit Rating Manual.
f::
a
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
V
Congress of Industrial Organizations (Committee for
Industrial Organization), The Program of the C.I.O.,
An account of major policies ana decisions adopted
at the conference of the Commit-tee for Industrial
Organization, Washington, 1937.
-The C.I.O. News, various issues.
---- The Case for Industrial Organization, Washington,
1936.
C.I.O. - What It Is and How It Came to Be, Washington,
October, 1937.
Daugherty, G.R., De Chazeau, N.G. and Stratton, S.S.,
The Economics of the Iron and Steel Industry, New
York. 1937.
Davis, Horace, Labor and Steel, New York, 1933.
Elting, John. "How U.S. Steel Works With the Union,"
Forbes, March 15, 1938.
Fitch, John A., "Steel and the N.R.A."
October, 1935.
Survey Graphic,
---- "Steel and the C.I.O." Survey Graphic, April, 1937.
"Steel: 1S36, Thunder on the Left and Right."
---- "A Man Can Talk In Homestead," Survey Graphic,
February, 193S.
Fortune, "The United States Steel Corporation," March,
April, May, and June, 1936.
---- «Xt Happened in Steel," May, 1937.
"The Industrial Warfare," November, 1937.
"The Great Labor Upheavel," October, 1935.
Gebert, B.K., "Steel Workers on the March," Communist,
May, 1937.
"The Steel Workers in Convention," Communist,
February, 1938.
•— --"The Steel Workers Give Their Mandate for Organi­
sation," Communist, June, 1938.
with permission o f the copyright owner. Further reproduction prohibited without permission
1
jj
j
vi
Harbison, P.H., Collective Bargaining in the Steel
Industry; 1937, Industrial Relations Section,
Princeton University, 1937.
-The Seniority Principle in Union-Management Re­
lations, Industrial Relations Section, Princeton
University, 1939.
Harvard Business School, *x'"?Jeirton Steel Company.”
|
Harris, Herbert, "How the C.I.O. Works,” Current
History, May, 1937.
Industrial Relations Section, Princeton University,
'^Piles on cooperating companies In the steel
industry.
Inland Steel Company, To the Employees of the Inland
Steel Company, July 1, 1937.
Interchurch World Movement, Commission of Inquiry,
Report on the Steel Strike of 1919, New -York,
IS20.
;
International Juridical Association Monthly Bulletin.
"Steel and Law," October, 1936, (entire issue).
Iron Age, various issues.
Jones and Laughlin Steel Corporation, “"piles of fourth
stage grievances.
‘“'Minutes of meetings of General Joint Conference,
December, 1938.to December, 1939.
Kent, Raymond P., ‘“'Labor Issues in the Captive Bitu­
minous Coal Mines, M.A. Thesis, University of
Pittsburgh, 1934.
Levinson, Edward, Labor on the March, Hew York, 1938.
|
Lose, James E., "Problems In the Manufacture and Use of
Steel Products In the United States," Yearbook of the
American Iron and Steel Institute, Hew York, 1939.
I
McCabe, D.A., "Machinery for the Adjustments of Dis, putes Under Hew Collective Agreements,” Law and
Contemporary Problems, Spring, 193S.
McDonald, David J., ‘“Instructions to all lodges and staff
members of the SWOC, October 5, 1938.
Monthly Labor Review, various Issues.
I
vj
R eproduced with permission of the copyright owner. Further reproduction prohibited without permission.
i
•
i
Murray, Philip, '■Instructions to all sub-regional and.
field, directors and staff members, May 5, 1938.
'''‘Statement before Public Contracts Board to deter­
mine the prevailing minimum wages In the iron and
steel industry, SWOC press release, July 18, 1939'.
'"‘Statement on proposed amendments to the national
Labor Relations Act, July 18, 1939. (Secured from
SWOC files).
1
national Association of Manufacturers, "Public Opinion
Chief Factor In Ending Johnstown Steel Strike,”
N.A.H. Labor Relations Bulletin, July 15, 1937.
Rational Industrial Conference Board, Inc., Quarterly
Review of the Iron and Steel Industry, various
issues.
National Labor Relations Board, Memoranda pertaining
to the steel Industry in files of the LIvision of
Economic Research.
Matter of Inland Steel Company, Case no. C-252,
November 12, 1938.
Matter of Republic Steel Corporation, Case no.
C-1S4, October 18, 1938.
Matter of Bethlehem Steel Corporation, et al.
Case nos. C-170, B-177, August 14, 1939.
Matter of American Steel and 7/ire Co., and Steel
and Wire Workers Protective Association, Case no.
R-556, March 8, 1S38.
New York Times.
0 1Connor, Larvev, Steel-Lictator, New York, 1935.
Pittsburgh Post-Gazette.
Pittsburgh Press.
Pittsburgh Sun-Telegraph.
Progressive Steel bonkers Union, "Constitution.
"Agreement with International Harvester Company,
Wisconsin Steel Works.
j
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
viii
“Report of Federal Steel Mediation Board to Secretary
of Labor, Frances Perkins, July 2, 1957 (in files
of Division of Economic Research, Rational Labor
Relations Board).
Republic Steel Corporation, '“'Manual for Merit Rating.
“'Vacation Plan for Rage Roll Employees, 195j .
’‘Manual on Job Evaluation.
"The C.I.O. vs. Democracy," reprint of statement
of T.M. G-Irdler before United States Senate, Com­
mittee on Post Offices and Post Roads.
Ruttenberg, H. J., "85,000 Victims of Progress," Mew
Republic, February 16, 1958.
^
---- "The Big Morgue," Survey Graphic, a.pril, 1939.
"The Strategy of Industrial Peace," Harvard
Business Review, binter, 1939.
Steel, various issues.
Steel Workers Organizing Committee, '"'Correspondence
and grievance files of the Northeastern Region.
--Handling Grievances, Publication ITo. 1.
Instructions - Books, Records and Reports for
Individual Lodge#, etc., August, 1939.
'“'Memoranda and instructions to staff members, field
representatives and local lodge officers issued by
the Chairman, Secretary-Treasurer and Director of
the Northeastern Region.
’“Personal files of H.J. Ruttenberg on Company Unions.
’“’Press Releases, various dates.
Production Problems, Publication Ho. 2.
Reports of the Officers to the Wage and Policy
Convention in Pittsburgh, December 14, 15, 16, 1937.
’“Report of the National Wage Scale Committee, December,
1957, Wage ana Policy Convention, December, 1957.
with permission o f the copyright owner. Further reproduction prohibited w ithout perm ission.
a
-i
IX
3
3
|
Steel Workers Organizing Committee (continued)
|
j
!
--- "Regulation number two, March 7, 1923, (agreement
between a nurews Steel Company and the Sv;CC Interpreting Section 6 ’^seniority] of contract).
"Rules and methods of Procedure for Lodges adopted
at SWOC Convention in Pittsburgh, Deceinber 14, 15,
16, 1937. i
‘-"Rules of Order and Business," Rubicon Lodge,
Ho. 1014, Gary, Indiana.
Steel Labor, various issues.
-^Various agreements between SUGG and companies in
til© stool and steel fabricating and processing
industries, also interpretive agreements and correspondence pertaining thereto.
""Wage and Policy Convention, Proceedings, December,
1937.
Strackbein, O.R., The Prevailing; Minimum Wage Standard,
Washington, 1939.’
Taft, Philip, "The Problem of Structure In American Labor
Unions," American Economic Review, March, 1937.
Taylor, Myron C., Ten Years of Steel, Extension of re­
marks at the annual meeting of stockholders of
the United otates Steel Corporation, April, 1938.
United States Circuit Court of Appeals, for the Third
Circuit, Republic Steel Corporation vs. National
Labor Relations Board, Ho. 6S07, Hovember, 1939.
United States District Court, for the District of Dela­
ware, Ho. 1050, United States of America vs.
Weirton Steel Company, February, 1935.
United States Congress, 74th Congress, An Act to pro­
vide conditions for the purchase of supplies and
the making of contracts by the United States.
Public--Ho. 846.
United States Department of Labor, Public Contracts
Board, "“Report of. Proceedings: Prevailing minimum
7/ages in the Iron and Steel Industry, July 26, 1933,
R eproduced with permission o f the copyright owner. Further reproduction prohibited without permission.
X
United States Department of Labor, Bureau of Labor Sta­
tist! cs, TtGeographical Variation in Hours and
Wages During 1933 and 1935,'' Monthly Labor Review,
July, 19380
United States Senate, 75th Congress, Third session, Com­
mittee on Education and Labor, Hearings: Violation
of Free Speech and Lights of Labor, Parts 15-D, 16,
19, 23-24, 37.
United States Steel Corporation, '""Job Evaluation Manual,
for subsidiary companies of United States Steel
Corporation, November 15, 1939.
U.S. Steel Hews, various issxj.es.
Walsh, J. Raymond, C.1.0.--Industrial Unionism in Action,
New York. 1937.
Weirton Steel Company, Employee Representation Plan,
By-laws adopted June, 193ZA as amended to June 1,
1934.
Works Progress Administration, Selected Information on
Steel Producers With Assets Over $100,000,000 Each,
New York, 1938.
'"Indicates unpublished memoranda in typewritten, mimeo­
graph, or printed form.
with permission of the copyright owner. Further reproduction prohibited without permission.
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