(b) The proposed legislation, as customarily applied to cane sirup, would increase existing wages 90 percent The sirup industry under the ruling of the Administrator and in fact is of a seasonal nature. The season extends over a period of about 60 days, and, of course, the mills must run 24 hours per day. The custom is to work two 12-hour shifts, 7 days per week, or 84 hours per week. Under the present wage-and-hour law and regulations, as applied to cane sirup, the flat rate of pay is 40 cents per hour with no provision for overtime. The present average weekly pay is therefore $33.60. The proposed amendment, as applied to cane sirup, would fix the rate of pay at 65 cents per hour for the first 56 hours and 972 cents per hour for the next 28 hours of the sirup mill employee's workweek. The average weekly pay under the proposed amendment would therefore be $63.70. In other words, the new legislation would increase the average weekly pay of a sirup mill employee from $33.60 to $63.70, or 90 percent. (c) The result would be an unbalanced economy Suppose it be argued that during the war sirup manufacturers received a good price and that they will probably receive a good price for their product during the coming season; what is nevertheless the result? During the war their employees received and they now receive an average weekly wage of $33.60. The war is over. Now one of three things must of necessity happen: The price will remain exactly and permanently stationary. The price will go up. The price will come down. The first proposition may be eliminated as an economic impossibility as markets, left alone, must and do fluctuate. The second proposition is possibly a consummation devoutly to be wished Unfortunately, however, it does not seem to be in the cards, unless there is some fancy pump-priming or subsidizing somewhere down the line. Now if Congress can devise a scheme to bring about high prices to meet the proposed higher wages, but without inflation, no industry could seriously complain. But the proposed amendment does not contemplate any such program. The sirup industry, of course, is not advocating the appropriation of money or the creation of a subsidy in order to meet the proposed increase in wages, but it brings out the point in order to demonstrate that the proposed legislation is only a half measure. On the one hand, it would almost double the wages of the employee, but on the other hand it offers no assurance to the employer that he will be able to meet the pay roll. If the market is left to the law of supply and demand, unshackled but unaided. one is forced to the conclusion that war prices will not hold. Soonor or later and probably sooner the price of sirup will drop. In the face of this proposition. however, the new legislation for the future would guarantee to the employee almost double the amount he received during the war and the high-price period. 5. The proposed amendment to the wage-and-hour law, as applied to the sirup industry, would discriminate against the vast majority of workers similarly situated for the following reasons: (a) The sirup industry is incidental to farming It is a fact that practically every sirup mill operator in Louisiana owns a farm and grows sugarcane. It is also true that such sirup mill owners grind sugarcane produced on their own farms. Numerous mills, of course, also grind outside cane, along with their own. It is believed, however, that the bulk of the table or country sirup produced in Louisiana is made from cane produced on the farms of the sirup-mill operators. In other words, the very general run of things is that sirup production is incidental to farm operations. In connection with sugar production in Louisiana most raw-sugar factories are built around and are operated on plantations growing sugarcane as their primary crop. There are in Louisiana, however, only about 64 raw-sugar factories. In southern portion of the so-called Louisiana sugar section, possibly onehalf farmer and is devoted to sugarcane production, and the other half totloor crops. In the northern portion of the sugar section third of the average farmer's land is devoted to the the balance to the production of other crops. In La ner does not by any means produce only sugarcane. otatoes, Irish potatoes, cabbage, corn, snap beans peppers, and other crops, depending upon his locality and the available market for his produce. We frequently find, in the sugar section, and especially in the northern portion thereof, farmers not growing any sugarcane, but devoting their entire land to other crops. Louisiana is an agricultural State and the sirup mills are located in the rural sections thereof. The fact is that the sirup mill labor is drawn from the farms around the mill. In the case of your petitioner, J. Dewey Singleton, for instance, every employee in his sirup mill, except the engineer, is or has been a farmer. It is believed that 90 percent of the workers used in the sirup mills throughout Louisiana are farmers drawn from the surrounding vicinity. (c) Only about 1 out of 15 farmers in the vicinity of a sirup mill is lucky enough to get a job in the mill As above pointed out, the sirup mills in Louisiana are located in the rural sections of the State. The rural sirup mill is surrounded by very numerous small farmers, growing varied crops. During grinding some of the farmers are engaged in planting and harvesting their own cane, others in harvesting corn, cotton, hay, harvesting, grading, packing and shipping sweepotatoes, and still others in making general repairs about the farm, etc. Besides, there is not enough work in the sirup mill to employ all the farmers even if they were not otherwise engaged. The result is that only approximately 1 out of 15 farmers around a sirup mill gets a job in the mill during grinding. (d) The proposed amendment would allow to farmers working in sirup mills an average of 76 cents per hour as compared to an average of 30 cents per hour earned by farmers engaged in general sugarcane farming operations Under the regulations of the Department of Agriculture, field labor is not entitled to an increased or graduated rate of pay for overtime work. The flat rates per hour for the various classes of sugarcane field workers established by the Department of Agriculture are as follows: Farm labor cutting cane_. Farm labor loading cane.. Other cane harvesting operations__ Farm cultivation labor other than tractor drivers and teamsters. Cents 31% 383 262%3 252 329 It is seen that the average rate of pay per hour for sugar-farming operations as set by the Department of Agriculture is approximately 30 cents. In order to fix and establish the general rates of pay the Department of Agriculture must find and did find that the foregoing rates are "fair and equitable." Now, as previously indicated, the proposed amendment, as applied to cane sirup, would fix the rate of pay at 65 cents per hour for the first 56 hours and 971⁄2 cents per hour for the next 28 hours of the sirup-mill employee's workweek. The average is thus 76 cents per hour. The small percentage of favored employees, while receiving more than double the wages earned by the others, would also be favored with a more attractive type of labor. It is certainly more agreeable to work in a sirup mill, under a roof and rather pleasant surroundings, than to work in the fields in inclement and sometimes freezing weather. Wherefore, petitioner, J. Dewey Singleton, in his capacity as vice president of and acting for the Louisiana Syrup Association, respectfully prays that the proposed amendment to the wage-and-hour law, as applied to pure cane sirup, as set forth in Senate bill 1349, be rejected and that the present provisions of the act and the regulations thereunder be retained. And he prays for general and equitable relief. THE LOUISIANA SYRUP ASSOCIATION, STATE OF IOUISIANA, Parish of St. Martin, s8: J. Dewey Singleton, being duly sworn, according to law, deposes and says: That in his capacity of vice president of and acting for and on behalf of the Louisiana Syrup Association, he is petitioner in the above and foregoing petition; that he has read the same and that all the facts therein contained are, in his opinion and to the best of his knowledge and belief, true and correct. J. DEWEY SINGLETON. Sworn to and subscribed before me this 16th day of October 1945. E. E. WILLIS, Notary Public. EXHIBIT 27 STATEMENT OF DR. WILLIAM M. LEISERSON I have been a vice president and member of the board of the Consumers' League of Ohio for 15 years. The National League is filing a statement in general support of bill S. 1349 and H. R. 3914, but I have been asked to testify particularly on a question raised before this committee by an officer of the Western Union Telegraph Co. with respect to messengers employed by the company. I happens that in 1938 I was the hearing officer appointed by the first Administrator of the Fair Labor Standards Act to conduct a public hearing and make findings and recommendations with respect to a request submitted to the Administrator for permission to employ messengers at wage rates less than the minimum wages specified in the act. In the course of my duties as hearing officer I became familiar with the messenger problem under the act, and I should like to address myself specifically to that problem. The present law provides that the Administrator is authorized to permit the employment of "messengers employed exclusively in delivering letters and messages" at such wages lower than the general minimum as he might prescribe. The representative of the Western Union Co. proposed to the committee that this provision be amended "to the effect that the increase in the minimum wage now under consideration shall not apply to messengers under 18 years of age employed principally in the pick-up and delivery of telegrams and letters." You will note that the word "principally" is substituted for the word "exclusively," and that the increase in the minimum wage proposed by S. 1349 and H. R. 3914 is not to apply to the messengers. When the original Fair Labor Standards Act went into effect in 1938 the company argued that it could not afford to pay the minimum rate of 25 cents an hour as required at that time. The Administrator held, however, that he was not authorized to exempt the company from this provision of the act, and since that time it has been paying the wages specified by the act. Nevertheless, the company has not been losing money and its predictions of financial losses have not materialized. On the contrary, the company has done pretty well financially. But aside from financial considerations there is the more important question of treating all employers alike who are engaged in the messenger business. So far as messenger service is concerned, the Western Union has competitors who are required to pay the minimum rates provided by the present Fair Labor Standards Act and who will be required to grant any increases that may be authorized by Congress if it adopts the proposed bill. At the hearing in 1938 two companies, Service Messenger Co., Inc., of New York, and Advertising Distributors of America, who compete with Western Union in the business of messenger service, requested that they be heard in opposition to the telegraph's petition for exemption. They appeared and presented evidence showing that the telegraph companies were using their messengers with lower rates of pay to compete unfairly with other business concerns engaged in messenger service. Because of the lower wages the telegraph companies were paying their messengers, they were able to underbid and take away business from these competing companies. Briefs filed by Advertising Distributors of America and by the Trade Assoclation of Advertising Distributors stated that "approximately 2,000 companies are engaged in distributing advertising circulars and samples and employ approximately 85,000 employees, and that the telegraph companies insofar as they distribute circulars and samples compete directly with these companies." The Administrator in refusing to exempt the telegraph companies from the wage provisions of the act observed that Congress may well have been aware of facts of this character, and the authority to exempt messengers may have been deliberately limited to those "exclusively" engaged in delivering letters and messages for this reason. If section 14 of the act, which authorizes exemptions under certain circumstances, had used the word "principally" instead of "exclusively," it would have permitted this unfair competition, and apparently Congress wanted to provide equal protection of the law to all competitors. 1 Opinion and Decision of the Adonator January 14, 1939, in the Matter of Applications of Western Union Talegraph Col At the hearing in 1938 an official of the Western Union Co. testified that in addition to delivering letters and messages, the telegraph messengers engaged in the following work: Carrying sample cases for salesmen, delivering packages and envelopes, exercising pet animals. Shopping for patrons. Paying bills for patrons. Making bank deposits for patrons. Delivering mail-order gifts services. Watching parked automobiles. Paging in hotel lobbies and railroad stations. Waiting in line to purchase theater tickets. Delivering orchids to ladies. Taking care of office. Sweeping offices. Performing clerical duties in emergencies. Soliciting business for the company. Collecting bills for the company. Picking up files at offices for delivery to main office. This makes plain that messenger service is an industry, trade, or business as defined by section 3 (h) of the Fair Labor Standards Act, and is not confined to delivering telegrams or other messages for the telegraph companies. There are hundreds of small businesses engaged in package delivery services and errand services of various kinds, and there are thousands of advertising delivery services. Western Union uses its messengers to engage in the same business, and it hardly seems fair to set a lower minimum wage for this company, while the other companies have to pay a higher rate. Just In this connection, it is important to note that RCA Communications, Inc., appared at the hearing and by its attorney there stated that this company had not asked for permission to employ messengers at rates lower than the minimum wage fixed by the act. Western Union at that time also stated that they did not desire exemption for messengers delivering radio communications. why delivery of ordinary telegrams should pay less than delivery of radio messages is hard to understand, and Western Union's proposed amendment would authorize exemption of radio messengers from the new minimum wage to be set by S. 1349 and H. R. 3914. According to reports submitted by the large telegraph and cable companies to the Federal Communications Commission for the year 1941, about 70 percent of all the accidents resulting in injuries occurred among the telegraph messengers, although messengers formed only 36 percent of the total employees. If we bear in mind that the messengers deliver not only telegrams or letters, but have to carry packages and perform other services which require them to be out in the busy traflic of the streets, the importance of the accident hazards becomes plain. Normally, hazardous occupations pay higher wages. Here your committee is asked to amend the bill so lower wages can be paid. There is a good deal of romancing about the opportunities that telegraph messengers have for business contacts which enable them to achieve great careers in various lines of endeavor. The fact is that the hazardous work accompanied by substandard wages paid prior to the adoption of the Fair Labor Standards Act caused an abnormally high rate of labor turn-over in messenger service. Boys worked a week or two or a month or two, and then quit. The record of the 1938 hearings shows that Western Union had to hire about 40.000 messengers a year in order to maintain a force of approximately 15,000. Personnel managers regard such a high rate of turn-over as "a symptom of some underlying maladjustment." Sometimes they refer to it as "a strike by erosion." But a Western Union official testified: "We consider a large turn-over a healthy condition" for the reason "That after a messenger has served in that capacity for several months, he ought to pass on into other and more permanent work." Temporary, casual labor also commonly commands a higher hourly wage than more permanent employment, because the worker cannot look forward to a future career in the business where he happens to be for a short period. But here again the request is that a lower minimum wage be authorized this time because there is no future in the work. Of course, among the thousands and thousands who have worked for a short period as messengers, there were bound to be a fair proportion who became great men in later life. But it would seem from the testimony before this committee that Western Union assumes that they might not have become great men if they had received adequate hourly rates of pay for their temporary work as messengers. There are, of course, a good many opportunities for advancement for messengers in the coupany's own large organization. Perhaps if the messengers were paid standard wages, fairly competitive with other businesses that engage in messenger serv ice, the abnormal turn-over would be reduced, and a larger proportion of the promising ones who are capable of achieving great careers might stay on to make their careers with the company. Western Union is clearly a business engaged in interstate commerce. No one questions that now. It is subject to the Federal Communications Act. It sells messenger services in competition with other businesses, even if it does not ship goods in commerce. There seems to be no justifiable reason why the Fair Labor Standards Act should not be made applicable to all its employees, re gardless of age, the same as it is to other communications industries, and industries that ship goods in interstate commerce. But particularly because it competes with other companies in the messenger business in cities throughout the country, the special privilege of paying lower wages than those provided by the Fair Labor Standards Act should not be granted to this company. The National Consumers' League desires to impress on the committee the need for examining carefully the whole problem of the competitive status of the messenger business in order that it may not be misled into hasty action on the assumption that all that is involved in the Western Union amendment is the question of permitting boys to deliver telegrams and letters. EXHIBIT 28 STATEMENT BY NATIONAL CONSUMERS' LEAGUE IN SUPPORT OF S. 1349, SUBMITTED TO SENATE COMMITTEE ON EDUCATION AND LABOR BY ELIZABETH S. MAGEE, OCTOBER 28, 1945 The National Consumers' League is on record in support of S. 1349, to amend the Fair Labor Standards Act. The National Consumers' League is a 45-yearold organization, with members in every State of the Union and from all walks of life. The league was founded on the idea that consumers have a stake in the conditions back of what they buy and a responsibility to use their organized power to improve these conditions. The sweat-shop flourished when we were organize', child labor was common among the families of the poor. The league appealed to consumers to use their buying power to promote fair-labor standards. But labels and white lists of employers who voluntarily agreed to maintain decent standards proved inadequate. Legal standards became necessary. We turned our attention to working for laws setting minimum wages, maximum hours, and controlling child labor. We had a hand in the passage of most of the minimum wage laws which are now in force in 26 States and participated in the legal defense of these laws when their constitutionality was challenged in the courts. We worked actively for the passage of the Fair Labor Standards Act. We want to see it improved now by raising the minimum wage rate, widening the coverage, and strengthening the child-labor provisions. We know that wages don't come out of a hat. They come out of increased production. But let us remember, they do not come automatically. It takes either legislation or trade union organization and sometimes both to set a floor to wage payments. It is well to remember also that wages are a contributing factor in increased producivity. It has frequently been the experience under State minimum wage laws that the necessity of paying a higher wage was the first thing which compelled real efficiency in certain lines of business. In this statement we comment on two aspects of the bill which have had less consideration in the hearings than the increase in the minimum wage: first. coverage; and second, control of child labor. ptions were included. There now nbstantially widened within the that the floor for wages which Leded as widely as possible. We umber of exemptions which the |