NATIONAL WAR LABOR BOARD, PRELIMINARY STATEMENT IN MARITIME CASES August 31, 1945. On July 19 and 20, 1945, the National War Labor Board held a public hearing on 17 maritime cases involving approximately 100,000 seamen in offshore dry cargo operations. Thirteen of these were new cases which arose on certification by the United States Conciliation Service. The other four cases involve a request for reopening of closed contracts, in view of the similarity of issues with those in the open contracts. A list of both groups of cases is attached. The unions in the 13 cases now before the Board for decision ask for an increase in monthly base wages, and for an adjustment in overtime compensation or a further wage increase in lieu thereof. They contend that the requested wage increase is necessary (1) to eliminate substandard hourly wage rates; (2) to remove inequities as between seamen's wages and wages in comparable shore-side occupation; (3) to offset loss of wages and take-home pay resulting from past and anticipated reductions in war bonuses by the Maritime War Emergency Board; and (4) to insure the adequate manning of our merchant marine. The operators object to any wage increase on the grounds that (1) present wages are not substandard, taking into consideration subsistence furnished by the employer and other contract benefits; (2) no true comparison can be made between off-shore and shore-side occupations, but if such a comparison were attempted, seamen's earnings, including penalty overtime and other contraet benefits, would compare favorably with earnings in shore-side occupations; (3) from their inception, war bonuses have been related solely to war risk; (4) a wage increase would impair the ability of the merchant marine to compete in peacetime with other forms of domestic transportation and with foreign flag vessels; and (5) no wage increase can be granted without a change in the national wage policy. The Board believes that the facts in this case warrant the use of Executive Order 9599, issued by the President on August 18, 1945, which authorizes the Board "to approve, without regard to the limitations contained in any other orders or directives, such increases as may be necessary to correct maladjustments or inequities which would interfere with the effective transition to a peacetime economy; Provided, however, That in dispute cases this additional authority shall not be used to direct increases to be effective as of a date prior to the date of this order." The major premise of the unions underlying the substandard issue is that seamen are as much entitled as any other group of American workers to a wage which will enable them to marry, and to maintain their families at a level of health and decency judged by the American standard of living. The operators do not deny this premise, but contend that present wages are not substandard, taking into consideration subsistence, penalty overtime, and other contract benefits. The same conflict exists with respect to the comparison of seamen's wages and wages in comparable shore-side occupations. Whatever equities exist in support of the unions' position with respect to these two questions have been considered in connection with the total equities in the case. The unions' request for a shortened work week and Saturday and Sunday premium pay is supported by the adjustments made in recent years by govern mental action or voluntary collective bargaining in other industries, likewise exempt from the Fair Labor Standards Act, including various forms of trans 1 The specific demands are as follows: NMU-55 cents per hour minimum instead of the present alleged minimum hourly rate of 34% cents (derived from present monthly base wage of $82.50 for assumed 240 hours) for an ordinary seaman, and 41% cents (derived from present monthly base wage of $100 for assumed 240 hours) for an able seaman; present differentials between classifications to be preserved; time and one-half after 40 hours a week; time and one-half for Saturdays and double time for Sundays. The NMU also asks for the incorporation of the 100-percent voyage or steaming bonus into the wage structure, and such further increase as may be needed for a 55-cents-per-hour minimum rate. portation where, as in this case, the operations cannot practically be concluded at any specified time of the day or week. However, it is the Board's considered judgment, under all the circumstances of this case, that this equity should not be separately appraised but should be considered in connection with other equities bearing on the main demand for a general wage increase. The Board has given careful consideration to the operators' contentions as to the peacetime competitive problems of the merchant marine, and the union's claim that a substantial increase is necessary to keep our ships manned and to maintain morale and efficiency. In this connection the Board has also considered the possible savings in cost of recruitment and training which would result from an increase in base rates sufficient to hold men who would otherwise return to shore-side occupations. The remainig issue arises from the reduction in take-home pay incident to reductions in war-risk bonuses, which have already occurred, and to their anticipated further reduction or complete elimination. Special bonus payments were originally instituted by collective bargaining several years prior to December 1941. On December 18 of that year the Maritime War Emergency Board was established by agreement of the parties, and given jurisdiction to determine the future course of war-risk bonuses during the war. Just prior to the creation of that Board, the bonus rate for specified voyages had reached the level of $80 a month for unlicensed and 66% percent for licensed personnel. It is estimated that this schedule represented, on the average, an additional payment of $61 per month for the unlicensed and 50 percent for licensed personnel. In its present form, the war-risk bonus scheme as administered by the Maritime War Emergency Board consists of a voyage bonus, an area bonus of $5 per day in areas of particular risk, and a vessel attack bonus of $125. The voyage bonus alone at its maximum amounted to 100 percent of the base wage or $100, whichever was higher. At present average earnings from the voyage bonus are $40 in the Atlantic, $72 in the Pacific, or $53 over all. All signs point to the reduction or complete elimination of the voyage bonus in the immediate future, leaving such risks as may still remain, such as the hazard of collision with floating mines, to be covered by the remaining area or attack bonus. The unions contend that since these bonuses were established by collective bargaining they should not, in accordance with the Board's established policy, be disturbed except through collective bargaining. The Maritime War Emergency Board has stated however, that under the agreement by which it was established "any action taken on war-risk bonuses and war-risk insurance superseded the provisions of existing collective-bargaining agreements insofar as the latter were in conflict, and was mandatory". Any weight to be accorded to the fact that the bonuses were originally established by collective bargaining should be given in connection wth the unions' claim for retention of the bonus established by the Maritime War Emergency Board, based on the unanimous statement of the Maritime War Emergency Board in its decision 2 C, issued June 18, 1945, reading as follows: "Decision 2 C is in accordance with the policy which the Board has adopted of establishing a world-wide floor of 33% percent ($40 monthly minimum) below which bonuses will not be reduced during the period of the war, to which period the existence, activities, authority, and jurisdiction of the Board are definitely limited in accordance with the statement of principles and the letter of the President appointing the Board at the request and on the recommendation of the parties signatory." It thus appears that the question as to what would eventually happen to this bonus floor was left open. Presumably, if not eliminated by the Maritime War Emergency Board itself, the bonus floor could be reduced or eliminated only through collective bargaining or through action of some governmental agency authorized to settle labor disputes. No realistic and final determination of the present dispute can be made without settling this issue. In this connection note may be made of the action already taken or about to be taken by Canada, Sweden, and Great Britain relating to the status of war-risk bonuses after the war. In The principle of a wage adjustment in lieu of overtime was instituted by President Roosevelt in the railroad industry. Operating and nonoperating railway employeesBrotherhood of Locomotive Engineers and Brotherhood of Railway Trainmen and the Representative Carriers, November 4, 1943, and December 27, 1943. The same principle was applied by the War Labor Board in the trucking industry. Central States Area Negotiation Committees and the International Brotherhood of Teamsters, AFL, cases 4448-4648, February 1944. See also Interstate Steamship Co., case No. 376, March 5, 1943. Letter dated August 4 from John M. Carmody, Chairman of the Maritime War Emergency Board, to Dr. George W. Taylor, Chairman of the National War Labor Board. Sweden this action has taken the form of integration of a portion of the bonus into the wage structure. In Great Britain a similar proposal is under discussion. The main assumption of the Board in determining what wage increase is appropriate and the effective date thereof is the complete elimination of the voyage bonus. Weighing all the equities in the case arising out of the issues of substandard wages, overtime, and the elimination of the bonus, and considering the fact that the wage increase will not be retroactive and the prospect that no part of the increase will take effect for at least 30 days hereafter, the National War Labor Board is of the opinion that a fair and equitable determination of all the wage and overtime issues in dispute calls for an increase of $45 per month in the base rate for all classifications, if and when the present voyage bonus has been completely eliminated. The question raised as to whether the operators should be named in the contract as employers, or, as in the last contract, as general agents for the War Shipping Administration, has no real significance. Whatever the designation in the contract, the operators are the employers for the purposes of this dispute, as contemplated by the War Labor Disputes Act.* There is likewise no real issue as to the so-called closed contracts involving the SUP, MM & P, and MEBA since the operators have indicated they are prepared to negotiate with these unions on the basis of the Board's decision." NATIONAL WAR LABOR BOARD, DIRECTIVE ORDER Maritime cases (list attached) August 31, 1945. By virtue of, and pursuant to, the powers vested in it by Executive Order 9017 of January 12, 1942, and the Executive orders, directives, and regulations issued under the act of October 2, 1942, and the War Labor Disputes Act of June 25, 1943, etc. I. Effective from the date of the elimination of the present "voyage bonus," each classification shall have added to its present base wage the sum of $45 per month. II. The foregoing terms and conditions shall be incorporated in a signed agreement reciting the intention of the parties to have their relations governed thereby as ordered by the National War Labor Board. III. Since this directive order may involve a question of increased cost to the United States, the directive order shall become effective only if also approved by the Director of Economic Stabilization. First group Representing the public: George W. Taylor, Lloyd K. Garrison, N. P. Representing labor: Yan Bittner, John Brophy, Robert J. Watt, Paul Representing industry (dissenting): Clarence Skinner, Vincent P. LIST OF CASES INVOLVED 111-11640-D-General agents of War Shipping Administration (east coast) and National Maritime Union, CIO. The companies which are in cluded are: Agwilines, Inc. American Export Lines, Inc. American South African Line, Inc. American-West African Line, Inc. Black Diamond Steamship Corp. Grace Line, Inc. International Freighting Corp., Inc. Lykes Bros. Steamship Co., Inc. Sec. 2 (d) of the War Labor Disputes Act provides that the term "employer" shall have the same meaning as in section 2 of the National Labor Relations Act. The latter section defines an employer as "any person acting in the interest of an employer, directly or indirectly Transcript of hearing, pp. 242, 243, 320. irst group--continued LIST OF CASES INVOLVED continued 11-11640-D-General agents of War Shipping Administration (east coast) and National Maritime Union, CIO. The companies which are included are—Continued. North Atlantic & Gulf Steamship Co., Inc. Parry Navigation Co., Inc. Polarus Steamship Co. Standard Fruit & Steamship Co. Stockard Steamship Corp. Sword Line, Inc. United Fruit Co. United States Lines Co. West India Steamship Co. Mystic Steamship Division. Eastern Gas & Fuel Associates. A. L. Burbank & Co., Ltd. Cosmopolitan Shipping Co., Inc. Merchants & Miners Transportation Co. R. A. Nicol & Co., Inc. Norton-Lilly Management Corp. Prudential Steamship Corp. William J. Rountree Co., Inc. States Marine Corp. T. J. Stevenson & Co., Inc. U. S. Navigation Co., Inc. Wessel, Duval & Co., Inc. J. H. Winchester Co. 111-15916-D-Pacific American Shipowners Association and Marine Cooks' and Stewards Association, CIO. 111-16461-D-Pacific American Shipowners Association and Marine Firemen, Oilers, Watertenders, and Wipers Association, Inc. 111-11488-D-Waterman Steamship Corp. and Seafarers International Union, AFL. 111-11489-D-South Atlantic Steamship Line and Seafarers International Union, AFL. 111-11490-D-Mississippi Shipping Co. and Seafarers International Union, AFL. 111-11491-D-Smith & Johnson and Seafarers International Union, AFL. 111-11492-D-American Range-Liberty Lines and Seafarers International Union, AFL. 111-11493-D-Overlakes Freight Corp. and Seafarers International Union, AFL. 111-11494-D-Eastern Steamship Lines and Seafarers International Union, AFL. 111-11495-D-Alcoa Steamship Co. and Seafarers International Union, AFL. 111-11496-D-Seas Shipping Co. and Seafarers International Union, AFL. 111-11497-D-A, H. Bull Steamship Co.; Baltimore Insular Line and Seafarers International Union, AFL. Second group 111-11428-D-Pacific American Shipowners Association and Sailors Union of Pacific AFL. 111-4649-D-General Agents of War Shipping Administration (east coast) and Masters, Mates and Pilots, AFL, and Marine Engineers Beneficial Association, CIO. 111-4932-D and 111-1360-D-General Agents of War Shipping Administration (west coast) and Masters, Mates and Pilots, and Marine Engineers Beneficial Association, CIO. EXHIBIT 5 STATEMENT OF SURG. GEN. THOMAS PARRAN, UNITED STATES PUBLIC HEALTH SERV- Public Health Service with respect to the relationship between income and health. I have not been advised by the Bureau of the Budget as to whether S. 1349 is considered to be in conformity with the program of the President. In your letter, you suggested that I discuss the following points: 1. Effect of low income on health and the purchase of medical services. 2. Relationship of income level to health, as revealed by selective-service re jection rates in the various States, if possible, by industries and States. The data available from the Selective Service System do not provide sufficient pertinent information on the relation of rejection rates to income level. There fore, I shall confine my comments to health and economic status in the general population. The Public Health Service has had long experience in the study of illness in relation to social and economic conditions. We have been impressed with the difficulty of separating from the many factors associated with individual and public health those principally responsible for excessive burdens of illness and premature death. Nevertheless, every statistical study of sickness, made by the Public Health Service and many other agencies, has told the same story: Families of low income have the most illness, and they receive the least medical care. Poverty is both a result and a cause of ill health. Low income and sickness result in a descending spiral of deeper poverty and greater suffering. Although the primary functions of health authorities are to prevent disease and to secure for the people better medical care, we cannot but be impressed with the difficulties in reaching these goals among families whose incomes are too low to provide a sanitary environment, a healthful diet, decent homes, and medical care. I know of no single step which would do more to improve health and nutrition than the assurance to every family of an income adequate for the provision of the minimum essentials of healthful living. Therefore, insofar as S. 1349-if enacted into law-would contribute to a higher standard of individual and community living, its provisions must be considered as contributory to national health. Ill health and poor nutrition always have been close and constant companions of poverty. As early as 1916-17, the late Edgar Sydenstricker, of the Public Health Service, pioneered in the study of social and economic aspects of illness. As a coworker of Joseph Goldberger, he showed that low-income families in southern cotton-mill towns had the highest pellagra rates-and the poorest diets. There followed in the Public Health Service the studies of illness in Hagerstown, Md.-a project that has continued for more than 20 years. The Service also participated in the surveys and analyses of data conducted by the Committee on the Costs of Medical Care. In 1933 we undertook, a study of the effects of economic depression upon health. And in 1935-36 we conducted the largest study of illness and receipt of medical care ever made-the National Health Survey. From the data collected in this study, the experience of over 700,000 urban families in 18 States has been analyzed. Significant differences in the amount and duration of illness among the various income groups were revealed by all of these surveys. NATIONAL HEALTH FINDINGS Some of the results of the National Health Survey may be of interest to the committee. In general, these findings show that families with annual incomes of $1,000 or less-whether on relief or not-had nearly 40 percent more total illness than did families with incomes of $2,000 or more; and they had 75 percent more chronic illness. Chronic disability prevents some workers of all income groups from earning a living or even seeking work. Among low-income families the proportion of unemployable workers was three and a half times greater than that among families with incomes of $2.000 or over. Here, again, the vicious circle of poverty and ill health is demonstrated. Illness among the poor is of longer duration than among more fortunate groups. On the average, persons with annual incomes under $1,000 in 1935-36 lost nearly twice as much time from work because of illness as did the average individual in the higher-income groups. st of the diseases with a large excess of disability in the lower-income hronic ailments. For example, the time-loss due to hernia in |