1940: Trade Unions

Growth and Membership.

The course of trade unionism in 1940 was colored by the national defense program, the presidential election, and the business revival, which began to reach substantial proportions in the final quarter of the year. These factors gave a new impetus to the organized labor movement and helped it to resume the advance which had been interrupted by the business recession of 1937-38, and by the public reaction against labor unions arising out of the wave of sit-down strikes of 1936-37, and the conflict between the C.I.O. and the A. F. of L. It is probable that the aggregate membership of all sections of the American labor movement reached 8,000,000 by the end of the year and was still increasing. This means that the number of union members had grown since 1933 from 3,000,000 to 8,000,000 and stood in 1940 at the highest point in American history. The level reached in 1940 exceeded even the war peak of 1920 by 3,000,000 members. These figures assume added significance when it is observed that the membership of 1940 was spread among practically all of the country's basic industries — mining, steel, metal, food, and textile manufacturing, transportation, and construction. While the unions were not equally strong in each of these classes of industry, they were strong enough in all of them to play an important, if not decisive, role in determining labor policy.

Labor's Place in the National Defense Program.

Political influences contributed much to the latest gains of organized labor. The initiation of the vast program of defense production immediately raised the question of labor's place in that program. This question was answered in organized labor's favor. The Defense Advisory Commission, created by the President to administer the program, had as one of its original members, Sidney Hillman, president of the Amalgamated Clothing Workers and vice-president of the C.I.O. The choice of one of the foremost union leaders for this post was an expression of the administration's labor policy. It was obviously intended to give organized labor an equal voice with industry in making and in executing defense policy. Mr. Hillman, with a long and varied experience with union problems and tactics, promptly established within his division the necessary machinery of labor representation. He associated with himself a species of policy committee composed of the presidents of leading A. F. of L. and C.I.O. unions. This agency served the double purpose of moderating the antagonisms between the two organizations and of creating the means of labor participation in the many decisions on labor policy in the defense program. The office of Mr. Hillman, likewise, took a leading part in settling industrial disputes either through special conciliators appointed for this purpose or through representatives of the joint trade union committee. Finally it was through Mr. Hillman's initiative that the defense commission recommended to the Government purchasing offices that they deny contracts to firms that violated, among other laws, the Wagner Labor Relations Act.

The effect of these steps was to put union labor in a position of great prestige and power. Participation by union leaders in the settlement of disputes increased their chances of gaining union recognition in unorganized plants and of winning more favorable terms in plants that were already unionized and operating under union contracts. The position the defense commission took on the Wagner Act and its violators paved the way for the unionization of many nonunion firms which had for some years successfully resisted union organizing campaigns and decisions of the Labor Relations Board. There was, indeed, at the close of 1940 almost a consensus of opinion that the labor policy of the defense commission, of which Mr. Hillman was the author, would shortly force such outstanding nonunion firms as Ford, Bethlehem, and Republic Steel into contracts with the steel and automobile unions.

The business revival of 1940 proved another fertile source of union gains. Since much of the revival was due to defense programs, its effects were most noticeable during the second half of the year. It was then that the unions began to direct their organizing activities toward plants busy with defense contracts. Before the year was over, unions affiliated with the C.I.O. and the A. F. of L. succeeded in winning recognition from companies in the airplane, machine tool, metals, and steel industries.

Continued Administration Support of Labor; National Labor Relations Board.

Fears that the outcome of the presidential election would break the continuity of our national labor policy were, of course, dissipated by the results of the election. Although Mr. Willkie frequently reiterated his sympathy with the labor and social reform legislation of the Roosevelt administration, it was believed that a Republican victory might so radically modify the administration of some of these laws as to weaken the hold of union labor. That, at any rate, appeared to be the opinion of the overwhelming majority of unions. For, in spite of the defection of John L. Lewis, the urban labor vote was cast preponderantly for Mr. Roosevelt. His re-election and the continuance of a Democratic majority in both houses of Congress assured organized labor the invaluable support of the administration and its multifarious agencies.

In addition to the benefits gained by organized labor through its participation in defense activities, the unions received inestimable support in the form of strong opposition by the administration to any vital revision of the Wagner Act. Pressure from the White House prevented the adoption of a series of thoroughgoing amendments to this Act in the face of powerful support in both the Senate and House. The President vetoed the Walter-Logan Bill which was aimed at curbing the powers of New Deal administrative agencies like the National Labor Relations Board. And even when the defense program was well under way, the administration resisted all pressure to suspend or modify the Fair Labor Standards Act. Thus the political foundations of the American labor movement, which contributed so heavily to the movement's growth after 1933, were, if anything, firmer in 1940 than in the years before.

Decisions of the Labor Relations Board during the year generally accepted the contentions and allegations of the unions and, hence, encouraged the progressive unionization of industry. Changes in the personnel of the Board hardly affected the main lines of policy established since 1935, except as to the position of craft unions and the conflicting claims of the C.I.O. and the A. F. of L. The United States Supreme Court, in all major matters of policy, consistently sustained the Board. The Court upheld the Board in its increasingly liberal definition of interstate commerce, refused to review the Board's findings in representation cases by holding that the Wagner Act did not provide for judicial review of the procedures and orders of the Board in cases pertaining to employee elections and certifications of unions, allowed the Board wide latitude in the determination of the facts in all types of cases, and in general showed great reluctance to limit the Board's powers by means of judicial decision. In the case of the Apex Hosiery Company, the Court found that the Sherman Antitrust Act was not applicable on the ground that it had not been shown that a sit-down strike had 'operated to restrain commercial competition in some substantial way.' In the equally important case of the Republic Steel Company, the Court supported a decision of the Board ordering the company to reinstate 5,000 employees who were not re-employed after the 'little steel' strike of 1937.

Problems Created by Defense Production.

The rapid developments in labor relations created new problems for the labor movement. The pressure for large and increasing defense production made the public and the administration critical of all stoppages of production. Strikes in airplane and other defense industries aroused universal protest and were the occasion in Congress for many proposals of new legislation, prohibiting or restricting the right to strike. The year, however, passed with no widespread or prolonged stoppages and Congress took no action. But the relation of organized labor to defense production remains a serious problem for the next years. The great expansion in the requirements for army camp construction brought to public attention practices of several of the building trades unions affiliated with the A. F. of L. As this type of employment increased, the unions were charged with exacting excessive initiation fees and dues from applicants for jobs. The sums alleged to be assessed by the unions amounted in some cases to several hundred dollars per person. Although these allegations received wide publicity and the unions concerned said that they would fix uniform fees of moderate size, the practices of unions on government jobs were not made the subject of public investigation and the size of the fees and dues they collect has so far failed to become a matter of public record.

In 1940 the trade unions of the United States began to face relatively novel conditions and problems. After ten years of persistent and large-scale unemployment, the combination of private business and vast public expenditures turned the tide of American employment. In many localities and occupations there were shortages of labor. The number of unemployed has steadily shrunk. Wages started rising once more, partly because of competition for labor and partly because of union demands. Organized labor has had to begin to reconsider its policies — to shift the emphasis from measures aimed to reduce the volume of unemployment to those calculated to avoid overexpansion and prevent inflation. See also LABOR LEGISLATION; SOCIALISM; WAGES, HOURS AND WORKING CONDITIONS.

1939: Trade Unions

Organized labor made less gain in 1939 than in any year since 1935. The American Federation of Labor reported a gain of 400,000 members, or half as many as the year before. Comparable figures for the C.I.O. are not available, partly because that organization has never reported its dues-paying membership and because the officers failed to submit to the second annual convention, October 1939, a report covering the finances of the organization. In spite of continued organizing activity, and a marked improvement in business it is doubtful that the labor movement as a whole did better than hold its own, or that the gains more than balanced the losses of the year. Among the factors that most powerfully affected the fortunes of organized labor were the continued struggle between the C.I.O. and A.F. of L., failure to organize parts of the steel and automobile industries, abandonment of the sit-down strike, a noticeable revival of independent unionism, and changing trends in public opinion and labor legislation.

Continued Split between C.I.O. and A.F. of L.

The irreconcilability of the C.I.O. and the A.F. of L. had begun to have an unfavorable effect on the position of trade unionism in general. On two occasions during the year, the President of the United States intervened to expedite negotiations and settlement. But both efforts failed. The mounting evidence of recalcitrance on the part of organized labor has, doubtless, alienated much support in Washington on which unions could previously count. In the public mind, likewise, the inability of two strong organizations to sink their differences and combine in a common program has raised questions as to the constructive character of much of trade union policy and practice. Employees were increasingly disinclined to join unions and expose themselves to involvement in jurisdictional disputes, upon which their wages and working conditions depended only remotely, if at all.

These influences tended to slow down organizing campaigns and to impair their effectiveness. Consequently no spectacular gains, similar to the victories in the steel and automobile industries in 1937, were made in the past year. The new unions in fact encountered formidable difficulties in collecting dues and holding members within their ranks. The non-union parts of the steel and automobile industries remained unorganized and the unions in question failed to wrest agreements from such firms as the Bethlehem and Republic steel companies and the Ford Company. On the East coast an ill-advised strike by the C.I.O. seamen's union, apparently not generally supported by the membership, was lost by the union and virtually destroyed organization among the seamen employed by the Standard Oil Companies of New York and New Jersey and the Texas Company.

Supreme Court Ruling on Sit-down Strike.

An influential factor accounting for this turn in the trend of the effectiveness of organizing campaigns was the changed legal position of the sit-down strike and sit-down strikers. It is common knowledge that much of the increase in union membership won during the period of spectacular growth, 1936-37, would have been impossible without the extensive and vigorous use of the sit-down strike. Although the practice of these methods aroused a storm of public protest and disapproval, the final status of the sit-down strike remained for some time in doubt. Indeed, in a critical case — the Fansteel Case — involving the use of this type of weapon, the National Labor Relations Board ordered sit-down strikers returned to their jobs. But in a sweeping decision in the same case on Feb. 27, 1939, the United States Supreme Court completely reversed the Board's decision. The effect of this decision was not only to cause the abandonment of the sit-down strike but also to induce the unions to conduct themselves with greater care and sobriety.

Revival of Independent Unionism.

Although the legal position of company unions was not changed, there were indications of a revival of unions, limited in their membership to individual plants or companies. Apparently many workmen, unwilling to join national organizations affiliated with either the C.I.O. or the A.F. of L., turned increasingly to independent local organizations of this sort. Where such unions are able to prove that they are free from domination by the employer and, hence, do not violate the provisions of the Wagner Act, they show promise of becoming an element of increasing importance in the American labor movement.

Status of National Labor Relations Board.

As in earlier years, the activities and decisions of the National Labor Relations Board, and the reactions of unions and the public to them, have continued to occupy a critical position in relation to our problems of labor relations. Since its inception the Board has been the chief bulwark of the trade unions. Its policies, procedures, and interpretations of the Act which it administers account, more than any other single factor, for the present position of trade unionism in this country. During 1939, the Board has made no radical revisions in its policy and, in the main, has applied the principles which it has developed since 1935. It has continued to disestablish plant or company unions and ruled against old and established organizations of this type in shops and offices of the Bethlehem Steel and Western Union Telegraph Companies. It has found the Republic Steel and Ford Companies guilty of a variety of unfair practices. It has followed the same principles in defining refusal to bargain and unfair practices and in fixing the limits of bargaining units which are familiar to all students of American Labor law.

Attitude of Courts toward NLRB.

Except for the Fansteel decision the United States Supreme Court has continued to sustain the Board, either on the merits of a case or by reason of its interpretation of the powers conferred upon the Board by the Wagner Act. During the past year, however, the Board has tended to be more frequently reversed in the lower Federal courts. In a decision, Jan. 9, 1940, the Circuit Court of Appeals at Chicago overruling the Board's findings, held that the Wagner Act could not be interpreted as requiring written agreements between employers and employees. In the same decision the court found that the Board's agent, the trial-examiner, had deprived the company of a fair hearing. Two important cases in other circuits reversed the Board in its decision holding the company unions in question to be dominated by the employers. In these cases, as in others like them, the courts appear to have become more critical of the Board's procedure and its guiding principles.

Investigation of NLRB.

This attitude of the courts reflects growing dissatisfaction with the Wagner Act and its application. For some years, and with much greater vigor in 1939, the A.F. of L. has been pressing for amendments to the Act and changes in the Board's personnel. Due largely to A.F. of L. influence Congress failed to confirm D. W. Smith, nominated for reappointment to the Board by the President. In the face of separate investigations of the Board, conducted by the Senate and House Committees on Labor during the last session of Congress, the House of Representatives at the same session created a new committee of inquiry under the chairmanship of Congressman Howard W. Smith. Equipped with a large staff of lawyers and investigators, this Committee spent the summer canvassing the files of the Board and seeking information from other interested sources. The Committee hearings begun in December are likely to continue well into the present session of Congress. But the evidence already introduced with reference to the Board's methods of assembling and weighing evidence and choosing its personnel, as well as the considerations that have determined its choice of guiding principles, makes it appear probable that the way is being paved for substantial amendments to the Act and changes in the Board's membership. The possibility of such proposed amendments to the national labor law is, indeed, forecast by amended state labor laws, dealing with the same questions and severely restricting the rights of unions, enacted in 1939 in Michigan, Wisconsin and Pennsylvania.

Unions and Anti-trust Laws.

Meanwhile unions of all camps and shades of opinion have been much aroused by actions brought against them under the country's anti-trust laws. The first of these cases arose out of a strike against the Apex Hosiery Company of Philadelphia, in the course of which the strikers forcibly occupied the plant and did extensive damage to plant and machinery. On April 3, 1939, the Federal District Court awarded the Company damages of $700,000. The decision was reversed by the Circuit Court of Appeals and has been appealed to the Supreme Court. Since unions of this country have always considered themselves exempt from the provisions of the anti-trust law, they await the opinion of the Supreme Court with unusual interest and dread. Their disquiet has, moreover, been increased as a result of actions independently taken by the anti-trust division of the United States Department of Justice. In a series of proceedings this agency sought and obtained indictments against unions in the building and trucking industries for violations of the anti-trust laws. The A.F. of L. has strongly protested invoking anti-trust legislation against the practices of unions. The Department, however, indicated its intention to proceed with the cases and, in a letter to William Green, president of the A.F. of L., Thurman Arnold, Assistant Attorney-General, enumerated as possible illegal practices, unreasonable restraints designed to (a) prevent the use of cheaper material, improved equipment, or more efficient methods, (b) compel the hiring of useless and unnecessary labor, (c) enforce systems of graft and extortion, (d) enforce illegally fixed prices, and (e) destroy an established and legitimate system of collective bargaining.

So defined, the application of the anti-trust law to unions is bound to have far reaching consequences. For most unions engage in one or more of these practices. If, therefore, this position of the Department of Justice is sustained by the courts, the effect on the legal status of organized labor will be more drastic than that resulting from most proposed amendments to the Wagner Act. See also AMERICAN FEDERATION OF LABOR; CONGRESS OF INDUSTRIAL ORGANIZATIONS; WAGES, HOURS, AND WORKING CONDITIONS.

1938: Trade Unions

Stability of Organized Labor Movement.

All important components of the American labor movement apparently continued during 1938 the advance which began in this country in 1933. In spite of the severe depression in business which prevailed the first half of the year and a level of employment which, throughout most of the year, was considerably below 1937, the unions appeared on this occasion able to resist the traditionally unfavorable effects of bad business. In fact, the three groups of unions, the A.F. OF L., the C.I.O., and independent railroad unions, which together comprise the organized labor movement, all claim to have increased their membership.

Growth in Membership.

How substantial the increase in membership was during the last year and what it was at the end of the year are difficult to determine with any degree of precision. The difficulty arises from the many ways in which membership is counted. The A.F. of L., for example, reports as members the number in whose behalf its constituent unions pay a per-capita tax. Federation membership consequently excludes a considerable number of unemployed members for whom no per-capita tax is paid. Thus in 1938, the A.F. of L. reported a total membership of 3,600,000. But according to William Green, president of the Federation, his organization had at the same time 1,400,000 idle members, making a total of 5,000,000. The C.I.O., on its part, does not distinguish between employed and unemployed, or between dues-paying and exempt members. The figure of 3,788,000 members which, not counting the International Ladies Garment Workers, the C.I.O. reports as its total membership in November 1938, probably includes both classes of members. Since it is known that the C.I.O. experienced much difficulty in collecting dues last year, it is not unlikely that a substantial proportion of its members failed to pay per-capita taxes. If we consider, also, the value for publicity and prestige of a large and rapidly increasing membership, it may be inferred that two organizations, competing for position and power, will both exaggerate their strength. On the other hand, it is a matter of record that the majority of agreements between employers and unions were renewed in 1938, and that a considerable number of new ones were made, thus bringing under union arrangements an increasing number of employees.

Accepting, then, the figures published by these organizations, the aggregate membership of A.F. of L., C.I.O., and independent unions would amount, at the end of 1938, to roughly 8,000,000 and would have increased during the year by possibly as much as 1,000,000. This amount is the highest ever reached by organized labor in the United States and exceeds the previous peak in 1920 by roughly 3,000,000. The number of organizable employees in the country may be estimated as around 35,000,000. In 1938, therefore, more than one-fifth of them were unionized.

Occupational and Regional Expansion.

Not only did trade unionism increase in numbers but it spread also into new occupations and regions. Both the C.I.O. and the A.F. of L. made substantial progress in organizing agricultural labor, hitherto successfully organized, and then only temporarily, by the I.W.W. There was a great expansion of unions among white-collar workers, with the result that relatively strong unions were established among newspaper reporters and editorial employees, clerks and salespeople, insurance agents, and architects. Unions, likewise, grew much stronger among many classes of service labor, notably in hotels and restaurants. Throughout the country many unions succeeded in winning recognition in small towns and rural areas, so that organized labor became not uncommon in the states of Vermont, Maine, and New Hampshire. In the South the movement experienced a veritable revival. The contract made by the United States Steel Corporation with the union and the successes of the United Mine Workers led virtually to the unionization of the coal and steel industries of the South. Much the same situation prevailed in the few Southern automobile plants. In the textile industry, the largest industry of the South, the C.I.O. Textile Workers' Organizing Committee conducted an uninterrupted campaign and succeeded thereby in creating much more widespread and substantial organization than the South has ever seen.

Public Opinion and Trade-unionism.

The causes of this expansion are manifold. Fundamentally the post-depression revival of trade-unionism was due to a profound change in public opinion. Beginning with the policies of business recovery which this country adopted in 1933, majority opinion had become converted to the need for high rates of wages and the short work-week, as the means for absorbing our increasing army of unemployed and stabilizing our economy. Among the methods available for achieving these ends, only two, regulating wages and hours by law and fixing them through collective bargaining between strong unions and employers, seemed the most practical. The general public, therefore, accepted a policy aimed at furthering union organization and collective bargaining.

Effects of Administration Measures.

The new policy toward unions did not, however, stop with creating a climate favorable to organization. From the National Industrial Recovery Act of 1933 to the National Labor Relations (Wagner) Act of 1935, the national administration sought and employed various measures for the protection and encouragement of organized labor. The first effects were a rapid recovery in membership by the established unions. The formation of the C.I.O. in November 1935 proved an extraordinary stimulus, particularly to unionization in the mass-production industries, and to unions, like the Seamen, dissatisfied with the policies of the A.F. of L. But more potent, probably, than any of these factors were the Wagner Act and the activities carried on under its terms by the National Labor Relations Board.

The year 1938 was the first full year since its creation that the Board was comparatively free of the fear of having its decisions reversed and its jurisdiction radically limited by the United States Supreme Court. It is during the last year, consequently, that the influence of the law and the policies of the Board on American trade unionism can be most clearly discerned. While it is no doubt true that the mere existence of a statute like the Wagner Act and a board to enforce its provisions would have improved the standing of unions in this country, it is the interpretation of the law and the policies of the Board that have most profoundly affected the position of organized labor.

Decisions by National Labor Relations Board.

Among the many decisions made by the Board during the last year, those affecting the status of strikers, the issue of the labor contract, and the position of 'employer-dominated' unions have been by all odds the most influential. In a number of decisions involving the right of strikers who participated in sit-down strikes, or who struck in violation of an agreement not to strike, the Board ordered the men reinstated in their jobs. The theory accepted by the Board in these cases was that strikes caused in the first instance by unfair practices on the part of the employer absolved striking employees of at least part of their guilt. The effect of these decisions was to strengthen the unions immeasurably, since the latitude enjoyed by unions in calling strikes and in the methods of conducting them was substantially widened while the chances of an employer's ever winning a strike were thereby radically reduced.

In a decision issued November 1938, the Board, following precedents of earlier decisions, held that the Inland Steel Company must bargain collectively with the Steel Workers' Organizing Committee and must make an agreement, in writing, with that organization. This decision was a landmark in the fight for recognition by unions in the unorganized parts of the iron and steel industry. In this industry the independent steel companies had indicated their willingness to bargain with the union and had claimed, indeed, to be doing so. But they refused to sign agreements, because, they held, the union was not responsible and could not be forced to live up to its terms and because a signed agreement, by adding to the prestige of the union, would lead many employees to believe that the union was sanctioned by the employer and thus impel them to join. If the decision is enforced, there can be little doubt but that it will be followed by a considerable increase in membership in the mills of this company.

Those decisions of the Board probably most vitally affecting union organization were made in cases involving the status of company unions. Here the Board has uniformly ordered the disestablishment of unions which it has found to be under employer domination, and has not permitted the names of such organizations to appear on the ballots in representation elections. Since organizations of this type have long been a formidable obstacle in the path of trade unions, the attitude of the Board toward them has proved most beneficial to the labor movement in general.

In addition to the effects of these particular rulings, the general activities of the Board, devoted as they are to investigating complaints against employers, holding elections, and reinstating discharged workers, have strongly encouraged the spread of labor organization. During the 12 months ended June 30, 1938, the regional offices of the Board received more than 10,000 charges and petitions, involving more than 2,000,000 workers. In the same period, 1,152 representation elections involving close to 400,000 eligible voters were held under the Board's auspices.

Other Influences and Encouragements.

An influence, much the same as that exerted by the Wagner Act, has been wielded by the so-called little Wagner Acts, notably in New York, Pennsylvania, and Wisconsin, and on the railroads by the National Mediation Board, acting under the terms of the Railway Labor Act, as amended in 1934. Limited in their jurisdiction to intra-state employments, the few state labor relations boards did much, like their Federal counterpart, to assist unions of hotel, retail store, and insurance employees in organizing and in achieving recognition from employers. On the railroads, likewise, the law and the Board have stimulated union growth, limited only by the long-time downward trend in railroad employment.

Contributing to a more sympathetic public attitude toward organized labor, were the reports of the President's Commission, appointed to study labor relations and the conditions of industrial peace in Great Britain and Sweden. This commission, composed of an equal number of representatives of employers, unions, and the public, was appointed in the summer of 1938. It proceeded to England and Sweden and in those countries made a survey of conditions, interviewing public officials, representatives of unions and employers' associations, and inquiring into historical developments. While the Commission's reports, published in the fall of the year, dealt with a variety of questions, their principal conclusion was that the prevalence in these countries of national collective agreements, negotiated by national unions and employers' associations, were the most effective guarantee of industrial peace and the stability of labor relations. The persuasive tone of these reports and their brevity and simplicity did much to win for them a favorable public opinion and for unions and collective bargaining much wider support than they had had before.