are not at this time at the stage of active legislative consideration, they are not dealt with in this report. Although a majority of your Committee believe that the Norton bill should be amended or supplemented in at least the respects hereinafter shown, a large majority of your Committee favor the enactment of the Norton bill, at the present session of the Congress. That large preponderance of view in your Committee is made up, in part, of those who believe that only the Norton bill should be passed at this time and that further amendments should await further experience, under the Act and the Board as altered by the Norton bill, and, in part, of those who believe that the Norton bill represents a minimum of what should be enacted at this time and that, in enacting the Norton bill, the Congress should amend and supplement it by adopting various provisions from the Smith bill. This report recommends Association approval for only such parts of the Smith bill as are believed to be consistent with the Norton bill and are favored by a majority of the Committee. The Norton bill (H. R. 9195) is stated by the House Committee on Labor (Report No. 1928) "to recommend no amendment which will impair in the slightest degree the fundamental rights and guaranties which that Act recognizes and seeks to protect." The Norton bill would make essentially four changes in the Act: (1) By increasing the membership of the Board to five members, by adding two new members to the present Board, which would be retained in office. This amendment has been favored by the American Federation of Labor on the ground that it would bring new members and new points of view into the work of the Board. The change has been favored by some on the ground that, with five members, some members of the Board could give increased attention to its decisions and could perhaps hear some of the testimony in major cases. (2) By providing that in any case where a majority of employees of a particular craft so decide, the Board shall designate such craft as a unit appropriate for the purposes of collective bargaining. The House Committee report says that "This doctrine is written in the New York Labor Relations Act, and has been satisfactory to proponents both of craft unionism and industrial unionism.” (3) By giving employers a limited right of petition. The Report accompanying the Norton bill says: “An employer is given the right to have an election held where two or more labor organizations (neither of which is company dominated) have each presented to him a claim with respect to the same or conflicting bargaining units that such labor organization represents a majority of the employees therein. This amendment has the effect of writing into law the policy adopted by the Board in its rules and regulations of entertaining employer petitions in the situation described." (4) By an attempt to clarify the situation where there is an existing contract and a majority of the employees change their affiliation, etc. The Report says, as to this provision of the Norton bill, "it is provided that where an employer has entered into a contract with a labor organization (which is not company dominated) representing a majority of his employees, as the exclusive representative of all his employees, in an appropriate collective bargaining unit, the loss by such labor organization of its majority or the change of its affiliation shall not impair the validity of the contract, but the contract is to continue in effect until terminated or until the expiration of one year from the date on which it went into effect, whichever occurs first. The Board is not to have power to certify the name or names of any other representatives with respect to the bargaining unit covered by the contract, or with respect to any other bargaining unit included in, or in which is included, either in whole or in part, the bargaining unit covered by the contract until after the contract has been terminated or has been in effect for one year, whichever occurs first." CERTAIN PROVISIONS OF THE SMITH BILL ALSO FAVORED BY YOUR COMMITTEE In addition to the enactment of the Norton bill (H. R. 9195), a majority of your Committee recommend approval also of the enactment, at this time, of the several provisions of the Smith bill (H. R. 8813) which are indicated in the recommendations submitted by your Committee. Their nature is briefly indicated and commented on as follows: (1) Amendment of Section 2 (3) of the Act so as to exclude from the definition of "employee" (and so from the protection of the Act as to reinstatement by the Board, etc.) any employee shown to have wilfully engaged in violence or unlawful destruction or seizure of property in connection with any cur rent labor dispute, etc. (Section 3 (a) of bill) This amendment would give statutory force to the decision of the Supreme Court in the Fansteel case (306 U. S. 240), and would in effect withhold the protection of the Act, as to reinstatement, etc., to workers who are guilty of acts of violence, "sit-down" strikes, destruction or seizure of property, etc. (2) Amendment so as to make clear that the Act does not bar open discussion; and "free speech", under reasonable safeguards, as to industrial matters. This proposal by the Smith Committee involves an amendment of Section 8 (1) of the Act, which now makes it an "unfair labor practice" for an employer "(1) To interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in Section 7." The amendment would add the following: "but nothing in this Section or in this Act shall be construed or interpreted to prohibit any expressions of opinion with respect to any matter which may be of interest to employees or the general public, provided that such expressions of opinion are not accompanied by acts of coercion, intimidation, discrimination, or threats thereof." (Section 8 of bill.) This amendment is urged as the logical corollary and complement of like rights of "free speech" by employees, as exemplified in the decision of the Supreme Court on April 22, 1940, in the California and Alabama “anti-picketing ordinance" cases. Obviously, those basic and traditional rights could not safely be limited to employees and denied to others. An amendment of the State Labor Relations Act, with similar purpose and purport, was recently passed by the New York Legislature and signed by Governor Lehman. (3) Amendment of statement of "Findings and Policy" (Section 1) of the Act, so as to make the Act less avowedly “anti-employer” and “one-sided”. The proposed amendment of statement of "Findings and Policy" (Section 1) of the Act would eliminate various phrases which are deemed to pre-suppose general employer obstruction of collective bargaining, and so the duty of the Board to align itself in opposition to employers and to encourage collective bargaining irrespective of the wishes of the employees, and so to make the Act and the Board anti-employer and “one-sided". Principally, where the opening sentences of the Act now read: "The denial by employers of the right of employees to organize and the refusal by employers to accept the procedure of collective bargaining lead to strikes", etc., the amendment would substitute: "The failure to bargain collectively between employers and employees leads to strikes”. etc. (Section 2 of the bill.) The Smith Committee states that the present wording is "an indictment of employers generally which is not justified by the facts." A similar amendment of the State Act has recently been passed, on like grounds. The Smith Committee states its further amendment of Section 1 of the Act as follows: "Second, the statement that it is the policy of the United States to encourage the practice and procedure of collective bargaining' was stricken. with the explanation that Congress should do everything in its power to protect the right of workers to bargain collectively but should not require the Board to encourage unionization where employees do not want it.' (4) Amendment of the Act so as to give to an aggrieved Union or employer a right of review of Board Orders based on certifications, etc. This proposal by the Smith Committee would amend Section 9 of the Act by adding a new sub-division (d) by which, as to an Order of the Board based wholly or in part upon a certification pursuant to Section 9 (c) (representation or "appropriate unit"), the Board may petition to enforce or an aggrieved Union or employer may petition for review, etc. (At present the Board or em ployer must await a Section 8 (5) proceeding, and an aggrieved Union has no right of review at any stage.) (Section 9 of the bill.) This amendment is designed to make available to the Board a more direct and expeditious enforcement procedure, in certification cases, than is afforded by Section 8(3) of the Act, and also to give to an aggrieved Union a right of review where none now exists (American Federation of Labor v. N L R B, 308 U. S. 401; NLRB v. International Brotherhood of Electrical Workers, 308 U. S. 413), even though the rights of the Union may be irreparably and completely destroyed, without review or remedy under the Act for the Union, under the present law. An aggrieved employer would also be given a right of direct review, whereas under the present Act the employer would have to await and resist a Section 8(5) proceeding and then review that Order, although his position and employee relations may have been irreparably changed and prejudiced meanwhile. (5) Limitation on the time within which complaints of "unfair labor practices" must be brought. This proposal is designed to place a reasonable limit of time upon the past period which may be ransacked and relied on for belated proofs of "unfair labor practices." The change involves an amendment of Section 10(b) of the Act so as to provide that "the Administrator shall not have power to issue a complaint stating a charge of any unfair labor practice which occurred more than six months prior to the date on which such charge was filed with the Administrator" (Section 10 of bill). (6) Limitation of time for which "back pay" may be awarded by the Board on reinstatement. This proposal by the Smith Committee is for an amendment of Section 10 (c) of the Act so as to provide that "No order of the Board or of any Court requiring the payment by an employer of money by reason of a finding that such employer has engaged in or is engaged in any unfair labor practice shall require such payment with respect to a period longer than six months, or with respect to a period which when added to any previous period with respect to which such payment was required either by the Board or by any Court by reason of the same finding, is longer than six months. (Section 10 of bill.) Under the decision by the Courts, an award of "back pay" stands upon the same footing as any other ordered affirmative action and is a preventive and enforcement measure against the employer, not an awarding of lost compensation to the employee (N L R B v. Arthur J. Colton, 105 Fed. (2nd) 179 (C. C. A. 6th); Agwilines, Inc. v. N LR B 87 Fed. (2nd) 146, 150-151 (C. C. A. 5th); Amalgamated Utility Workers v. Consolidated Edison Company, 84 L. ed. 493). Under such circumstances, it is deemed competent for the Congress to determine and limit the period for which back pay may be awarded. The Smith Committee so recommends, in the above proposal. (7) Amendment as to Rules of Evidence at Hearings before the Board. The proposal is an amendment of Section 10(b) of the Act so as to provide, as to hearings before the Board, "Any such proceeding shall, so far as practicable, be conducted in accordance with the rules of evidence applicable applicable in the District Courts of the United States under the Rules of Civil Procedure for the District Courts of the United States, adopted by the Supreme Court of the United States pursuant to the Act of June 19, 1934' (Secion 10 of the bill). This change is recommended in the interests of greater uniformity in rulings by the many Trial Examiners, as well as of substantial conformance, "so far as practicable", to familiar and accepted concepts of proof according to "the rudiments of fair play." By some, the presence of the phrase "so far as practicable" is deemed to be vitiating; by others, the provision as it stands is deemed to be a wise and advisable step toward enjoining some standards of uniformity and fairness upon the many Trial Examiners of the Board. (8) Creation of the oflice of Administrator of the National Labor Relations Act and the separation of prosecution and enforcement functions from those of hearing and deciding cases according to the evidence. This proposal by the Smith Committee involves the amendment of Sections 2(1)), 3, 4, 5, 6, 7, 10, 11, and 12, of the Act, to create the office of Administrator of the National Labor Relations Act, appointed by the President; the Administrator to make preliminary investigations of charges, file complaints before the Board, present evidence before the Board or its Trial Examiners in support of complaints, institute enforcement proceedings, etc.; the purpose and plan being to separate the prosecuting and enforcement functions from those of hearing and deciding cases according to the evidence. The adoption of this proposal is urged by its sponsors on the ground that it will give a more efficacious machinery for investigatng and prosecuting complaints and instituting enforcement proceedings, and at the same time will ten! to bring about a more impartial hearing and determination of cases according to the evidence, through ending the present combining of functions by which the members of the Board are the investigator, complainant, prosecutor, judge, jury and enforcement officer, in the same case, often hearing their own employees as witnesses and passing on the merits of their own complaints. (9) Amendments as to scope of judicial review of Board findings, on review or enforcement proceedings. This recommendation by the Smith Committee, favored by a majority of your Committee, would amend Section 10(e) of the Act so as to provide that in enforcement and review proceedings in the Circuit Courts of Appeals. “The findings of the Board as to the facts shall be conclusive unless it is made to appear to the satisfaction of the Court (1) that he findings of fact are clearly erroneous, or (2) that the findings of fact are not supported by substantial evidence." (Section 10 of the bill.) Although this amendment would change the wording of the statutory provi sion under which the Board has thus far operated, the change is urged by the Smith Committee as making uniform, and as means of giving effect to, the "substantial evidence" rule declared and applied by the Supreme Court in the Consolidated Edison case (305 U. S. 197, 229) and other cases. See, also, Stork Restaurant, Inc. v. State Labor Relations Board, 282 N. Y. 256; decided March 5, 1940; 6 Labor Relations Rep. 74. By some persons, this amendment is re garded only as codifying an existing rule which all Courts should apply un formly, regardless of statutory requirement thereof. The report of the Smith Committee says, however: "While it is true that the Consolidated Edison case (1939), 305 U. S. 197. broadened to some extent the concept of what evidence was deemed substantial, the nature of the controversies which the Board is called upon to decide, such as the determination of an employer's true motive for discharging an employee, are such that the courts ought to be given more power than they now have under the present law to review the Board's findings of fact. Thus, an addıtional standard is prescribed under which he court can overturn such findings" A minority of the members of your Committee are not in accord with the above-stated recommendations. The number of votes in the negative on them has varied according to the particular proposal. The Committee does not consider that in the submission of this report embodying the majority views, any member is bound or precluded in his or her individual opinions. RECOMMENDATIONS I. That the Association favors the enactment of the Norton bill (H. R. 9195at the present session of the Congress. II. That the Association favors the enactment also, by amendment of th Norton bill or otherwise, of substantially the following provisions of the Smith bill (H. R. 8813): (1) That section 2 (3) of the National Labor Relations Act be amended so as to exclude from the definition of "employee" (and so from the protection of the Act as to reinstatement by the Board, etc.) any employee shown to have wilfully engaged in violence or unlawful destruction or seizure of property in connection with any current labor dispute, etc. (Section 3 (a) of bill). (2) That Section 8 (1) of the Act be amended so as to provide that "nothing in this Section or in this Act shall be construed or interpreted to prohibit any expressions of opinion with respect to any matter which may be of interest to employees or the general public, provided that such expressions of opinion are not accompanied by acts of coercion, intimidation, discrimination, or threats thereof" (Section 8 of bill). (3) That Section 1 of the Act (statement of "Findings and Policy") be amended as provided in Section 2 of the Smith bill. (4) That Section 9 of the Act be amended so as to give to an aggrieved. Union or employer a right of review of Board Orders based on the certification of all xclusive bargaining agency for an appropriate unit, etc. (Section 9 of Smith (5) That Section 10 (b) of the Act be amended so as to limit to six months he period within which a complaint for "unfair labor practices" may be brought Section 10 of Smith bill). (6) That Section 10 (c) of the Act be amended so as to limit to six months he period for which "back pay" may be awarded by the Board to reinstated mployees (Section 10 of Smith bill). (7) That Section 10 (b) of the Act be amended so as to provide, as to heargs before the Board and Trial Examiners, that "Any such proceeding shall, o far as practicable, be conducted in accordance with the rules of evidence pplicable in the District Courts of the United States under the Rules of Civil "rocedure for the District Courts of the United States, adopted by the Supreme Court of the United States pursuant to the Act of June 19, 1934" (Section 10 of Smith bill). (S) That the Act be amended so as to create the office of Administrator of he National Labor Relations Act and separate the functions of complainant, prosecutor and enforcement officer from those of hearing and deciding cases according to the evidence and the law. (9) That Section 10 (e) of the Act be amended so as to provide that, in review and enforcement proceedings in the Courts, "The findings of the Board as to The facts shall be conclusive unless it is made to appear to the satisfaction of the Court (1) that the findings of fact are clearly erroneous, or (2) that the findings of fact are not supported by substantial evidence" (Section 10 of Smith bill). April 29, 1940. Respectfully submitted. William L. Ransom, Chairman; Charles Abrams; Howard C. Anderson, Jr.; David L. Benetar; S. John Block;1 Roy H. Callahan; Goldthwaite H. Dorr; Herbert W. Haldenstein; Arthur Garfield Hayes; Walter Gordon Merritt; Irving S. Olds; Emil Schlesinger;1 Frederick Sheffield; Florence Perlow Shientag; Frederick J. Steinhardt; Burton A. Zorn.1 1 SEPARATE STATEMENT BY MR. ARTHUR GARFIELD HAYES I join generally in the submission of the above report, and approve most, but not all, of the recommendations for present changes in the Wagner Act. I place particular stress upon the proposed amendment to Section 8 (1) of the Act, to make it clear that the Act and its lawful administration place no restraints upon freedom of speech by employers or upon open, public discussion of labor relations, so long as employees as well as employers are left free to decide and choose, as to matters which are theirs to decide and choose. The Committee has limited its report to specific proposals for amending the present Act. My principal question arises from the thought that this Committee, and other committees of Bar Associations, should consider the dangers to civil liberties which are inherent in laws which state commands and prohibitions in broad but indefinite language and then empower boards and commissions to enforce and make them specific through adjudging personal or corporate guilt of violations. This question of course involves not only the Wagner Act, but a great deal of legislation during the past ten years and more. Can we preserve in this country the realities of civil liberties and freedom of speech, if laws are so indefinite that neither the average business man nor his lawyer can be reasonably sure what they command or forbid, and if it is left to some board, rather than the Courts, to say what constitutes a violation and who is guilty? In a sense we are tending toward what seems to me to be undemocratic practices-indefinite laws and judgment by Commission. I think that, in connection with our report, consideration ought to be given to the practicability of a definite law under which clearly defined interference with labor organizations and discrimination against Union members would be a violation, in which event an employee aggrieved by the violation would have a right to compensatory damages (including back pay where discharged, and 1 See statements at end of report. |