those matters which the canner controls, price, time of delivery, which the canner controls and which affect wages and which affect working conditions.

I wanted to say this: The question of union security ought to be a question between the boatowner and the union, because it is the boatowner who does the hiring.

As I said before, if the boatowners set the price then we wouldn't be asking for dealings with the canner on this.

Senator BARTLETT. Now, let's leave it right there for the time being. As I understand it, Mr. Margolis, you as attorney for local 33 endorse S. 1135, with the changes you have suggested, and you are going to submit to the committee language which you believe would accomplish your recommendations?

Mr. MARGOLIS. If I may add to that, that is exactly right, but I think my changes are only clarifying changes to carry out the intent of the bill and are not changes in the purpose of the bill, as I understand it.

Senator BARTLETT. That was my impression. They are not substantive, they are merely technical in character.

Mr. MARGOLIS. That is right.

Senator BARTLETT. We have the words "collective bargaining" at one point in the bill, I notice.

Mr. MARGOLIS. Yes.

Senator BARTLETT. Thank you very much for your very worthwhile contribution.

(The following was supplied for the record:)

SUPPLEMENTARY STATEMENT ON BEHALF OF FISHERMEN'S UNION,

LOCALS 33 AND 33A, ILWU, IN SUPPORT OF S. 1135

This statement is respectfully submitted as a supplement to the oral testimony and exhibits submitted on behalf of Fishermen's Union, Locals 33 and 33A, ILWU in San Pedro, Calif., on May 17, 1963. The central point of our position is simply that a fisherman's wages depend directly upon the price paid for fish by the canner; the canner fixes the price to be paid and thereby fixes one of the factors directly determinative of a fisherman's wages; unless the fishermen are permitted to bargain collectively with the canner on the subject of prices as they affect wages and on related matters of delivery of fish which are directly tied into earnings of the fisherman, then as a practical matter fishermen are deprived of the right to bargain collectively on matters relating directly to their wages; all other workers in the country engaged in interstate commerce have the right to bargain collectively on all matters relating to their earnings; S. 1135 would remedy this discrimination against fishermen and would place them as a practical matter in the identical position with all other workers so far as the right to collectively bargain with respect to wages, hours, and working conditions are concerned.

In response to this contention it has been urged before this committee that fishermen do have the right to bargain collectively with the boatowners with respect to other conditions of employment. Thus the statement submitted by Mr. August Felando, general manager of the American Tunaboat Association, contains the following argument:

"The principal point I wish to make is that there are various factors that affect the crewmember's share aboard our member vessels, and that such factors are matters that are subject to negotiations between the unions and the vessel's managing owner. Thus, even without the right to negotiate fish prices, the unions can influence the income of their members."

This is equivalent to saying that a union should have the right to bargain collectively only with respect to some of the items which determine the wages of their members. This, of course, is not the law generally and it should not be the law with respect to fishermen. Unless the fishermen have the right to

bargain with respect to all items that determine their wages, the result is that fishermen do not have the full right to bargain collectively.

Another contention that has been made is that fishermen may bargain with the boatowners on the matter of price and that if they are not satisfied they have the right to srike in order to get a satisfactory price from the boatowner. The proponents of this argument prove too much. No one has disputed the fact that the price paid by the canner and the price on which a fisherman's wages are based are always identical. Nor is it disputed that the practice is for the canners to simply announce the price which will be paid, which price then determines the wages of the fishermen. This being so, we have the ridiculous situation where a union has the right to strike against the boatowners in order to obtain a condition of employment which is determined not by the boatowner but by the canner. Thus, the unique argument is made that the present law is good because it permits a union to strike against A in order to obtain conditions from B. We have a whole system of laws predicated upon the proposition that it is the right of workers to bargain collectively concerning their wages, hours, and working conditions and that such bargaining will help minimize interruptions of interstate commerce. Yet, we have the odd contention being advanced by the opponents of this bill that there should be a right to strike concerning a condition of employment with respect to which there is no meaningful right to bargain collectively. Thus this bill is necessary not only to protect the right to bargain but also as part of the national policy designed to obtain fair and equitable working conditions with the minimum interruption of interstate commerce.

In this connection it is important to note that experience has established that collective bargaining simply doesn't work through a bifurcated process where the union bargains with the boatowners and the boatowners in turn bargain with the canners. The end result of this type of bargaining has been the elimination of all agreement relating to price, even those between boatowner and canner, and the establishment of absolute monopoly control over purchase prices by canners.

Another objection that has been advanced against this bill is that the unions would overrule boatowners and would become together with the canners the sole parties to bargaining and the determining of prices. This is a bugaboo on which a page of history is worth a book full of rhetoric. We don't have to speculate on what might happen. We know what has happened in the past when there was bargaining by unions with the canners. The boatowners participated fully in such bargaining. No one has even advanced the contention that the unions overrode them. To the contrary three-way bargaining worked precisely because it reflected the peculiar economic relationships in this industry. There is no greater danger that fishermen's unions will overreach themselves than there is that boatowners associations will do so. The self-interest of fishermen and boatowners on this point is the same. Such self-interest prevented overreaching in the past and will accomplish the same result in the future. Actually what this bill will do is to restore the economic balance in the market so that prices on which wages are based are not arbitrarily and unilaterally established by the canners without meaningful bargaining with any one. The tremendous economic power of the canner and the competition of foreign fish will do more than is necessary to balance off the bargaining power of unions. The need for a union participating in the bargaining process has been clearly established by the boatowners response to recent price cuts. Admittedly, they protested (apparently for the record) but that was the end of the matter. The cuts were accepted even when they violated all past precedent as to their effective dates. And the reason for this is obvious. The facts establish the continued economic power and control maintained by the canners with respect to the boatowners. The canners argue that they have been trying to divest themselves of control of boats but have not been able to do so as completely as they would like. Even where they have divested themselves of control, it has been necessary for them to guarantee loans obtained from banks by the boatowners because otherwise the boatowners did not have the economic standing to obtain these absolutely essential loans. This inability of the canners to divest themselves of control, and the necessity of their guaranteeing loans even when they technically did divest themselves of such control is again a reflection of economic reality, a reality in which the boatowner as a practical matter is dependent upon the canner for his survival.

Another contention that has been made is that there has been effective collective bargaining between the boatowners and the canners on the one hand and between the boatowners and the unions on the other. The first point has already been disposed of and recent price cuts before which the boatowners have stood helpless demonstrates the unreality of this contention. So far as effective bargaining between the boatowners and the unions are concerned the standard clause in their collective bargaining agreements reads as follows:

"The crew's share shall be computed and the crew paid their wages and shares of all fish sold and delivered domestically based on either (1) the average of the prevailing prices paid by all canners in the San Pedro and San Diego harbor areas for each such species of fish for domestic boats that arrived at or about the same time as arrival of said boat or (2) the actual sale price of said load of fish, whichever basis is higher."

It is clear that under this clause it is the canners who determine what the average price will be. In fact the average prices paid by the canners as a group and the prices paid by an individual canner are so uniform that reference to an average is virtually meaningless. In effect the unions have been forced to agree that the canners will unilaterally determine that aspect of their wages which is set by prices.

Another contention that was made was that the damaging character of the kind of bargaining for which the unions are arguing was demonstrated by an exhibit of local 33 showing that Van Camp made no profits in 1955. The argument is a little difficult to follow in the light of the fact that all such bargaining ceased in 1950. As a matter of fact during the period of such bargaining the industry admittedly prospered and as a witness opposing the bill put it, the industry grew up under such bargaining. All that the unions are asking is that we go back to the conditions under which the industry did in fact grow up.

Another bogeyman that has been advanced is that this bill will establish a dangerous precedent for other industries. We know of no other industry in which a worker's wages are directly tied into price. This being so, this bill can set no precedent because there would be no place to apply it. Let us emphasize again, the fishermen are not asking for more than the rights possessed by other workingmen. All that they want is to bargain with those who determine what their earnings shall be just as all other workingmen have the right to bargain with those who establish the amounts of their earnings. There was a time when it was argued that meaningful collective bargaining would destroy industry. In the light of what has happened in the past 30 years it would seem that no one can any longer make such an argument in good conscience. S. 1135 should be passed and should restore the fishermen the right to bargain collectively with respect to their wages.

Respectfully submitted.

STATEMENT OF GORDON P. SCHELLENBERGER, REPRESENTING THE CALIFORNIA FISH CANNERS ASSOCIATION

Mr. SCHELLENBERGER. Senator Bartlett, my name is Gordon P. Schellenberger. I am here as a representative of the California Fish Canners Association and its membership. Perhaps I am not easily recognizable. I don't have my horns on or my Halloween mask. But I am one of those bums that Mr. Royal was referring to.

Our association members

Senator BARTLETT. You look like a well-fed one at the moment. Mr. SCHELLENBERGER. Thank you, sir.

It might be well, as a matter of record, to state who our members are in the California Fish Canners Association. They are Van Camp

Seafood Co., Star Kist Foods, Inc., Westgate-California Co., California-Marine Curing & Packing Co., Pan-Pacific Fisheries, Inc., and Franco-Italian Packing Co.

Senator BARTLETT. May I ask you a question there?

Mr. SCHELLENBERGER. Yes.

Senator BARTLETT. Does Franco-Italian have any other interests? Do they produce any other foodstuffs?

Mr. SCHELLENBERGER. Not that I know of, sir. It is entirely a fishery.

I am also here representing a nonmember of the California Fish Canners Association who has asked that I represent them along with the California Fish Canners Association, and that is California Packing Corp.

Senator BARTLETT. Which does not itself pack any fish?

Mr. SCHELLENBERGER. At the moment it does not. It has in times past, and it does have fish packed for it.

Senator BARTLETT. It has a subsidiary?

Mr. SCHELLENBERGER. Yes-well, it has fish packed for it by other packers.

Senator BARTLETT. I understand.

Mr. SCHELLENBERGER. Under its private label, which is a very famous label, the Del Monte label.

I thought this was to be a hearing on Senate bill No. 1135, but in listening to Mr. Royal with some of his hearsay and irresponsible attacks, at least, I think so, against the canners, I was a little confused.

I am not going to try to meet all of the accusations that he made against the canners. However, I think perhaps one incident deserves a little comment. He offered a picture which purportedly showed a contrivance by which the canners stole fish from the fishermen. It just so happens that in that particular case a lawsuit was filed by the fishermen who claimed that that fish was lost. It just so happened that my firm and I represented the canner against whom that lawsuit was filed. It also just so happened that that lawsuit never went to court. It was dismissed by the man who filed it, and nothing was ever paid him. I merely cite that as an example of the irresponsibility of some of the accusations that were made.

Now I will get back to bill 1135, which I assume I am here to discuss. With respect to the bill, the California Fish Canners Association believes that in the interest of the public very careful examination should be made of this bill, for it would radically change the operational procedures in the tuna fishing industry, which is by no means a small segment of the American fish industry. For example, over the last 10 years 7 billion cans of fish were bought and consumed by the American public, 1 billion of which was in the last year.

We feel with that magnitude it becomes increasingly important for us to take a long, careful look at this bill, particularly when we know, and all of us know-and I don't think there is any disputethat canned tuna is the most reasonably priced, high-protein food value that the public can buy. When I say that, I mean in competition with other high-protein foods; not only cheaper; it is more easily handled, more easily stored, and as a matter of defense in the last war, the Government found it necessary to permit, even though it had stopped all other types of shipbuilding except those it considered

necessary for transportation of troops and various other freight, it permitted with the highest priority the building of 32 tuna clippers to catch fish that could be canned and used in various parts of the world because of its high-protein value, its easy handling, and distribution.

That is why we feel that in the public interest this bill is extremely important.

Approximately 85 percent of the tuna packed in the United States is packed by the members of the California Fish Canners Association, and in voicing the association's opinions regarding this bill I am directing my attention particularly to how it would affect the tuna industry.

Senator BARTLETT. Excuse me right there. You mentioned 85 percent. Is that tuna plants other than the canners in California?

Mr. SCHELLENBERGER. Yes, yes. That includes other canneries operated by the members of the California Fish Canners Association. I am particularly directing my remarks to the tuna industry because I feel that other segments of the fishing industry, such as the salmon packers up north, your various fisheries of the east coast and gulf coast, have different problems. They are not the same as ours. They are operational problems, seasonal limits, many, many things that I could go on into for a long time that I am not going to, that are different from ours.

Now, it may be, as has been indicated by the salmon packers that this bill if properly worded and clarified could be made satisfactory to them. That is not true as far as the tuna packers are concerned. We are opposed to this bill's entire concept. Basically the reasons are as follows:

It extends the realm of collective bargaining by unions far beyond the normally accepted limits of the employer-employee relationship, and particularly so in the tuna industry. It has been acknowledged by those who testified so far that technically, at least, the employeremployee relationship exists between the fishermen and the boatowner, and I think it goes far beyond technically, because the boatowner in the tuna industry owns as an independent contractor boats that range all the way from $150,000 up to three-quarters of a million dollars, including the gear and equipment, nets and so forth, aboard the vessel. He is for all purposes an independent contractor. Also, unlike many of the other fisheries, all of his crewmen are union members, a hundredpercent union.

If the union under this bill, the provisions of this bill as it now stands, becomes, under the cloak of an association under an amendment to the Marketing Act, the company bargaining agent for the price to be paid by the packers for fish, it is not difficult to see that by the very numbers they would overwhellm the boatowner associations as bargaining agents and become the sole medium through which the packer could obtain fish from American vessels.

Such a situation would vest monopolistic power in the unions, and it is not difficult to envision the fact that a major restraint of trade could exist under that situation. It has not been stated today, but it has been stated in the hearings on May 8 before this subcommittee that this legislation is strictly permissive. In other words, the packer doesn't have to do anything if he doesn't want to. He doesn't have to bargain