TRIAL EXAMINERS NOT RESPONSIBLE TO CONGRESS

Trial examiners are appointed by the Board with the approval of the Civil Service Commission. There are approximately 65 men assigned to the National Labor Relations Board. Plan No. 5, which would delegate vast authority, is completely out of line with our traditional practice. It is even more serious that this delegation might be extended to Board employees. These employees and trial examiners would, in actual fact, have the authority of Federal judges in their area of jurisdiction. Agency members and judges have, under our system, been appointed by the President with the approval of the Senate. It would be a serious mistake, we emphasize, to confer judicial powers on such Board employees who are responsible only to the Board and not to the President or to the Congress.

LOW PRODUCTION OF TRIAL EXAMINERS

Congressman Roman Pucinski (Democrat, Illinois), chairman of the House subcommittee investigating the NLRB, has stated that, if trial judges decided as many cases as the average NLRB trial examiner, "the electorate would be up in arms."

A table of the production of the 65 trial examiners for the past 3 years indicates that some of them hold 2 or 4 hearings a year. The average increased from 9 hearings per examiner in 1958 to 11 in 1960. Mr. Pucinski stated that "millions of Americans would work like beavers" for the trial examiners' salary of $15,000 a year. This is the group that will "accelerate" the processing of cases.

NLRB-PRISONER OF ITS OWN PROCEDURES

The written testimony of Board officials given before this and House committees indicates that there is little substance in the Board's espousal of plan No. 5.

Under plan No. 5, the vote of one less than the majority of the Board may also bring such an action to the full Board for review. In the absence of Board review, the actions taken under the foregoing delegation would be deemed actions of the Board. During the oral exchange after the testimony was given before this committee, the Board was at a loss to explain why the reorganization plan would require the vote of two members of the Board to grant review of a trial examiner's decision, whereas present practice requires review by the entire Board when only one member so requests. Page 124, footnote 24, of the Board's testimony (before this committee) is a paradox, since it states that, the reorganization plan notwithstanding, the present Chairman and the members are unanimous in their desire to maintain the practice of allowing a single member to bring any case to the full Board for consideration.

It is also anomalous when the Board insists that it is required to grant a full, de novo review to every trial examiner's intermediate report. The Board's rules and regulations (see sec. 102.46, Exceptions to the record and proceedings) do not provide for a de novo review. On the contrary, section 102.46 of the rules provides that exceptions and briefs filed with the Board to a trial examiner's report must designate, by precise citation of the page and line, the portions of the record which are disputed.

The regulations go on to provide that "no matter not included in a statement of exceptions may thereafter be urged before the Board, or in any future proceeding." Accordingly, the Board by its own regulations should not grant full, de novo review to every contested trial examiner's intermediate report. If the Board merely followed its own rules and regulations, and not the inbred institutionalized system it embraces, there would be no need for any reorganization of its activities.

Obviously, the Board is a prisoner of its own procedures.

It is unfortunate that the Board's testimony insists that experience has proven the general acceptability of reports issued by trial examiners. Exceptions to trial examiners' reports have been filed in over 75 percent of the cases decided by these individuals. Although the Board indicates that approximately half of the reports are affirmed in full, the affirmance is often not clear cut and the Board's opinion may differ with that of the trial examiner despite agreement on final result.

We question the Board's statement with respect to the general competence of the Board's trial examiners. Some of them are nonlawyers. Others rereceived their indoctrination with the Board during Wagner Act days. Still

others have caused considerable concern to the Board because of their lack of judicial temperament.

A former NLRB member, Joseph A. Jenkins, now regional director of the NLRB office in Albuquerque, N. Mex., in testimony before the House Labor Subcommittee on National Labor Relations Board, expressed concern about the lack of disciplinary power over trial examiners. He felt that the Board should have some control over the trial examiners so that it could take action on the "low producers." He also characterized the caliber of the examiners to the effect that some of them have "great minds" while others have "extremely mediocre minds." He dismissed his damning evaluation by stating that nevertheless plan 5 provides for some review by the Board, and, if not, by the appellate courts.

The Board is also impressed by plan No. 5 because pro forma exceptions as a dilatory measure would be obviated. We submit that if the Board so desired, by internal regulation, this type of practice should have been stopped long ago. The Board was also most conspicuous in failing to state in its testimony that the Cox committee was of the view that it was Congress responsibility to enact this legislation and not accomplish it by Executive order.

We submit that with this delegation the Board will not become an appellant body able to cope with its caseload. Its current institutionalized procedures will be further enlarged so that an even greater staff would be required to screen and consider appeals from trial examiner decisions. The Board insists that this delegation would give it more time to consider truly important cases. We believe that this delegation would give it even less time since the petitions for review would be overwhelming.

The question also must be posed as to whether this delegation would cause a roadblock for the General Counsel of the Board so that his workload would be further increased. This might possibly be a new source of delay.

PLAN 5 PERMITS DELEGATION OF POWER TO BOARD CHAIRMAN

The NLRB officials do not read plan 5 as conferring additional powers on the Chairman. The Board's General Counsel, however, differs. In testimony before the House Government Operations Committee, the General Counsel responded as follows to Representative Brown (Republican, Ohio) :

"Mr. BROWN. All right, answer my question, whether or not, under this reorganization plan, in your legal opinion, the Board could delegate all of its power to the Chairman to, in turn, set up these different examiners and delegate authority where he pleases. [Italic added.]

"Mr. ROTHMAN. The reorganization plan appears broad enough to SO authorize."

To reiterate testimony given by the chamber before the House Committee, there is apparently quite a sleight of hand involved in this plan. Accordingly, there is basis for apprehension that plan 5 has the inherent power to make the Chairman of the NLRB a “czar." It is true that this plan does not contain any specific provisions as to the powers of the Chairman, but we have the legal opinion of the General Counsel of the Board himself who is of the view that the plan is broadly written.

PLAN 5 AMENDS THE LANDRUM-GRIFFIN ACT

Plan 5 would permit the Board to disregard the 1959 amendments to the Taft-Hartley Act whereby the Board was given authority by Congress to delegate decisionmaking in representation cases. Now, if plan 5 is not disapproved, this amendment would be vitiated and delegations can be made to Board employees.

NLRB Chairman McCullough admits that section 1(a) of plan 5 "seems broad enough to permit such result," and unless Congress otherwise so stipulates, the Landrum-Griffin Act will be effectively amended. Unfortunately, it is not possible to amend any reorganization plan submitted by Congress and this gives more thrust to our contention that if for no other reason plan 5 must be disapproved. The NLRB has disavowed this interpretation. May we respectfully suggest, therefore, that Members of Congress, if they are so disposed, make a part of the legislative history of this plan, the NLRB's expressed intention that the Landrum-Griffin Act is not amended by plan 5.

PLAN WOULD DEPRIVE NLRB LITIGANTS OF DUE PROCESS

Plan 5 would deprive litigants who invoke the Board's processes of due process guaranteed them by the Federal Constitution and Congress. Appeal to the members of the National Labor Relations Board who are appointed by the President by and with the consent of the Senate is a vested right given to all our citizens by the Congress. These individuals are entitled, as a matter of right, to have the Board members review a trial examiner's decision. If the Board's review is based on a pick-and-choose basis, these parties will be deprived of due process. A high-ranking union official recently stated that his federation is looking for a greater degree of organizing success in the South. He stated that the changed composition of the National Labor Relations Board and anticipated changes in policies will assist union organizing. (See Daily Labor Report, Bureau of National Affairs, June 26, 1961, A-14.) We submit that due process should not be sacrificed in order to assist union organizing.

The Board's testimony makes a point that Congress adopted a similar delegation in 1959 when the Landrum-Griffin Act gave the Board discretionary right of review in representation (election) cases. This is true; however, it was Congress and not an Executive order which accomplished this delegation.

If the Board merely followed its own rules and regulations, there would be no need for a de novo review of trial examiner decisions. No reorganization plan or act of Congress would be necessary; and the processing of cases would be considerably expedited. The Board's regulations require the filing of exceptions to the trial examiner's findings by specifying line and page number of report. Any frivolous exception can be disregarded by the Board. Only matters of substance need be considered.

INABILITY TO OBTAIN LEGISLATION IS NO EXCUSE

The Board's testimony bemoans the fact that plan 5 cannot be enacted by Congress because any labor legislation provokes "a long and sometimes deadlocked debate." The national chamber submits that despite the fact that labor or any legislation may be long and tortuous, this is our democratic process. This "check and balances" system which results in the separation of powers between the executive, legislative and judicial are the basis for the strength of our country. Merely because legislation is difficult to enact is no reason for an attempt of the executive to supplant that of the legislative.

If the Board is desirous of accomplishing this delegation, it would be fit and proper if it obtained the support of the executive branch and Members of Congress to support the legislation introduced by the Senate Subcommittee on Administrative Practice and Procedure of the Senate Committee on the Judiciary. (See Rept. No. 168, 87th Cong., 1st sess., dated April 14, 1961, S. 1734.) S. 1734 would amend the Administrative Procedure Act by amending sections 7 and 8 of that act so that trial examiners' initial decisions would become the final decisions of the agency subject to agency review only upon specified limited grounds. Interestingly enough, S. 1734 merely permits delegation of decisional authority to one or more members of the body which comprises the agency, or one or more examiners. It is pointedly absent in permitting delegation to an agency employee. S. 1734 also spells out the various grounds upon which appeal can be taken from an examiner's order. Plan 5 is lacking in this specificity.

COURTS WILL FACE GREATER INFLUX OF CASES

It is doubted whether delegation of decisional authority to trial examiners will save time for Board members. The Board is now almost 30 years old and its procedures and practices have become institutionalized. If plan 5 is approved, although there might be a perceptible decrease in Board workload at the outset, bureaucracy would soon take over with the inevitable "chain of command" setup so that cases, despite standards of review, would again pile up. Further, if litigants find that they cannot obtain a hearing from Presidential appointed Board members, they will make greater use of the appellate courts. More than three-fourths of Board litigants at present do not accept decisions of trial examiners and it is doubted whether this percentage will decrease if examiners' decisions are given greater finality. The NLRB Chairman has recently pointed out that the total NLRB decisions which have been contested in the courts far exceeds the total for all other Federal administrative agencies combined. This indicates a lack of confidence by the public in Board proceedings. 72420-61-7

CONCLUSION

The national chamber urges this committee to defeat plan 5 for the following

reasons:

1. Plan 5 would deprive NLRB litigants of due process under the law.

2. Plan 5 indicates a complete breakdown of Board procedures and Congress should hold immediate hearings to reorganize the agency.

3. Delegation of authority to the NLRB Chairman, trial examiners, and others under plan 5 is ultra vires. This delegation can only be enacted by the Congress and not by Executive order.

4. Trial examiners and Board employees are not responsive to the President or to Congress and should not be given such vast authority.

5. This proposed delegation of authority would not solve the NLRB dilemma, but reveals a need for complete change of Board procedures either by way of complete decentralization of all its activities, raising of jurisdictional standards or abolition of the Board with all its responsibilities transferred to administrative courts.

Senator MUSKIE. We will recess now until 2:30.

(Whereupon, at 12:15 p.m., the committee was recessed, to reconvene at 2:30 p.m., the same day.)

AFTERNOON SESSION

The CHAIRMAN. The committee will resume.

Our next witness will be Mr. Harvey M. Crow. Come up now, please, sir.

STATEMENT OF HARVEY M. CROW, ASSOCIATE GENERAL COUNSEL, NATIONAL ASSOCIATION OF MANUFACTURERS, WASHINGTON, D.C.

Mr. CROW. Thank you, sir.

My name is Harvey M. Crow, associate general counsel of the National Association of Manufacturers, and my statement is presented on behalf of that association, Mr. Chairman.

The CHAIRMAN. Do you have a prepared statement?

Mr. CROW. Yes.

The CHAIRMAN. Do you wish to read it?

Mr. CROW. Mr. Chairman, in the interest of speeding up and relieving you gentlemen of time here, I would like to read parts of this. The CHAIRMAN. Very well. Your prepared statement will be printed in full at the conclusion of your remarks.

Mr. CROW. Thank you, sir.

We appear specifically in opposition to the President's Reorganization Plan No. 5 of 1961 which deals with the National Labor Relations Board.

Although our comments also bear in considerable degree upon other reorganization plans, at the outset we would like to make very clear that the NAM shares with many the desire for efficiency and expeditiousness in carrying out all aspects of the public's business.

More fundamentally, however, we are concerned that the public's business be conducted fairly and impartially, and in a climate or atmosphere of fairness, as well as expeditiously and efficiently.

Congress has made repeated and good faith efforts, through the Administration Procedure Act and other statutes, to assure the public that its laws will be fairly administered. Nevertheless, there per

sists in the public mind a lack of confidence in the complete fairness of decisions by many administrative agencies of the Government.

As so well stated very recently by Senator Dirksen of Illinois, and I quote the Senator:

Charges have been made that the actual decisions are made "on the dark side of the moon" by unidentified persons who act behind the scenes and bear no public responsibility; that the decisions are not based solely on the evidence and argument presented in open hearing; that they are both prejudged and prejudiced;

The citation for the quotation, Mr. Chairman, appears in my state

ment.

The CHAIRMAN. Is that a reference to this particular agency or a reference to Government agencies generally?

Mr. CROW. That is to Government agencies in general.

The CHAIRMAN. It wasn't a specific indictment of this agency?
Mr. CROW. No.

The CHAIRMAN. I think that ought to be clarified.

Mr. CROW. It is general statement reflecting what the Senator seems to feel is the public's reaction to the system of administrative law, so to speak.

Loss of public confidence in the fairness of administrative decisions has been nowhere more apparent than in the case of the National Labor Relations Board. Thus, as early as in 1941 the special committee to investigate the National Labor Relations Board reported to the House of Representatives, and again I quote:

On the basis of the evidence and testimony before it, committee reached the conclusion that the Board has been unfair and biased in its conduct, its decisions, and its interpretation of the law.

Likewise, it has been grossly partisan in its attitude toward certain labor unions, and most deplorably biased in its relations to employers and employees. The CHAIRMAN. Well, that ended back in 1941.

Mr. CROW. Yes.

The CHAIRMAN. I hope there has been some improvement since then.

Mr. CROW. I hope so and I think there has been, Mr. Chairman. The CHAIRMAN. You are not charging that there has not been? Mr. CROW. No, sir; I believe that your question primarily will be answered in the next paragraph.

The CHAIRMAN. Very well.

Mr. CROW. Since 1941 when these and similar charges were made, the Congress, in both the Administrative Procedure Act and the TaftHartley Act, has sought to achieve greater public confidence in the Labor Board by requiring procedural reforms.

To quote again Senator Dirksen:

In general, these changes made by both Congress and the courts have been to insure that the operation of the administrative system would not only be fair but appear to be fair.

Nevertheless, the proposed Reorganization Plan No. 5, and others, would permit a return to an administrative system whereby essentially final decisions could be made by persons who bear no public responsibility since they are far removed from the electorate.

The principal reason given by the Labor Board in justification of the proposed delegation of decisional authority is that "Experience has proven the general acceptability" of trial examiners' reports.