1939: Labor Legislation

Federal.

With the passage in 1938 of the Fair Labor Standards Act and the Railroad Unemployment Insurance Act, the period of expansion in Federal labor legislation had for the time being come to an end. No major law of this class was enacted by Congress in 1939. Developments during the year were concerned with the revision of the Social Security Act, problems of administration, and the debate over proposed amendments to the National Labor Relations Act.

Social Security Act Amendments.

The Social Security Act Amendments were signed by the President on Aug. 10. The most important revision was made in the part of the Act dealing with Old Age Insurance. The amendments advanced and liberalized the old-age benefits and reduced the taxes of both employers and employees. The amended law provided that the payment of monthly benefits shall begin Jan. 1, 1940, two years earlier than originally scheduled. The rate of benefits for those retiring in the early years are increased and monthly benefits are provided for the aged wives and dependent children of annuitants and to the survivors of insured wage-earners. The coverage of the old-age insurance system is extended to seamen on American vessels, employees of banks building and loan associations, and similar organizations. Wage taxes of one per cent each, payable by workers and employers, are maintained at that rate for the next three years instead of being raised to 1½ per cent, as originally provided. The combined effect of reducing contributions and raising benefits has been to meet the criticism directed against the accumulation of a huge old-age insurance reserve.

The changes made in other parts of the Act were not so considerable. Some slight extension of the coverage of the unemployment compensation laws was made and an estimated saving to employers of about $65,000,000 a year was effected by a change in the law which exempted from the pay-roll tax that part of an employee's wage or salary in excess of $3,000 a year. Benefits under the public assistance programs were generally liberalized, and in the case of grants to the states for the aid of the indigent aged and blind, the Federal Government raised its matching grant from maximum of $15 to $20 a month.

Unemployment Compensation.

See UNEMPLOYMENT INSURANCE; UNITED STATES: Relief and Security.

Administration of Fair Labor Standards Act

In June 1939, the Fair Labor Standards Administration completed the first year of its existence. The first Administrator of the Act, Elmer F. Andrews, resigned before the close of the year and was replaced by Colonel Philip Fleming. Although the minimum wage rates and maximum hours, fixed by the law, were widely adopted there was evidence of frequent violation and accumulation of complaints in the offices of the Administration. The statutory minimum wage of 25 cents an hour, which prevailed in the first year, was raised on Oct. 24 to 30 cents an hour and the maximum hours per week were reduced from 44 to 42. It is estimated that some 650,000 employees will be affected directly by the advance in the minimum wage and that some 2,400,000 workers, now employed at more than 42 hours, will be affected by the new hour provisions. In an increasing number of industries, including by the end of 1939 the cotton, hosiery, wool textile, apparel, hat, millinery, shoe and knit-goods industries, industry committees, as provided by the law, have recommended minimum rates of wages ranging from 32.5 to 40 cents an hour. (See WAGES, HOURS AND WORKING CONDITIONS.)

Pressure for Revision of Wagner Act.

The piece of Federal labor legislation which has been most widely discussed and considered is the National Labor Relations (Wagner) Act and there are signs that this statute will be shortly amended. Suggested amendments touch this law at many points. The A. F. of L. has been anxious to limit the power of an administrative board to fix the bargaining unit. In common with employers and other critics of the present situation, the Federation has deplored existing administrative procedures which confuse the judicial and executive functions of the Board and has advocated some method of separating these functions. Limitations on the employer's right to a free expression of opinion and to frank discussion with his employees have been another source of dissatisfaction. The employers particularly have been urging revisions in the law which would bar unfair practices by labor as well as by employers and management. The Administration in Washington has so far consistently and effectively opposed any tampering with the Wagner Act. But the pressure for revision has recently grown much stronger. When amendments are made, they will in one form or another deal with these issues.

State Labor Legislation.

In the states, the most important legislation of the year was the labor relations laws enacted in Wisconsin, Pennsylvania, Minnesota and Michigan. These laws reflected a strong reaction against the wave of strikes and violence in 1937, widespread local dissatisfaction with the Wagner Act and the Labor Relations Board, and changes in state Administrations. While the provisions of these laws are not identical, they have in common the curbs they impose upon certain union practices and the prohibition of unfair practices by both labor and employers. The Wisconsin Act, for example, excludes employees who have been found guilty of an unfair labor practice from voting in representation elections. The check-off of union dues, unless authorized in writing, is defined as an unfair practice of employers. Coercion and intimidation, mass picketing, secondary boycotts, violation of a collective bargaining agreement, picketing or boycotting unless a strike is called, and taking unauthorized possession of the property of an employer are defined as unfair practices of employees. Labor representatives, moreover, are required to keep a record of financial transactions and make reports to members. Both the Wisconsin and Pennsylvania acts drastically modify the anti-injunction law by permitting the issuance of injunctions in many types of labor disputes.

The enactment of a workmen's compensation law in Arkansas, authorized by an amendment to the State Constitution adopted the year before, completes, with the exception of Mississippi, the roster of American States which provide compulsory insurance against industrial accidents. (See also CHILD LABOR.)