consent is filed in the court in which such action is brought. The court in such action shall, in addition to any judgment awarded to the plaintiff or plaintiffs, allow a reasonable attorney's fee to be paid by the defendant, and costs of the action.

"INJUNCTION PROCEEDINGS

"SEC. 17. The district courts of the United States and the United States courts of the Territories and possessions shall have jurisdiction, for cause shown, and subject to the provisions of section 20 (relating to notice to opposite party) of the Act entitled 'An Act to supplement existing laws against unlawful restraints and monopolies, and for other purposes', approved October 15, 1914, as amended (U. S. C., 1934 edition, title 28, sec. 381), to restrain violations of section 15.

"RELATION TO OTHER LAWS

"SEC. 18. No provision of this Act or of any order thereunder shall excuse noncompliance with any Federal or State law or municipal ordinance establishing a minimum wage higher than the minimum wage established under this Act or a maximum workweek lower than the maximum workweek established under this Act, and no provision of this Act relating to the employment of child labor shall justify noncompliance with any Federal or State law or municipal ordinance establishing a higher standard than the standard established under this Act. No provision of this Act shall justify any employer in reducing a wage paid by him which is in excess of the applicable minimum wage under this Act, or justify any employer in increasing hours of employment maintained by him which are shorter than the maximum hours applicable under this Act.

"PORTAL-TO-PORTAL ACT OF 1947

"SEC. 19. For provisions relating to compromise, preliminary, and postliminary activities of an employee, statute of limitations, reliance on administrative rulings, liquidated damages, and so forth, see the Portal-to-Portal Act of 1947 (61 Stat. 84; 29 U. S. C. 251).

"SEPARABILITY OF PROVISIONS

"SEC. 20. If any provision of this Act or the application of such provision to any person or circumstance is held invalid, the remainder of the Act and the application of such provision to other persons or circumstances shall not be affected thereby."

PART III

AMENDMENTS OF THE WALSH-HEALEY ACT

SEC. 3. Section 1 (d) of the Walsh-Healey Act, as amended, is amended to read as follows:

"(d) That no oppressive child labor as defined in section 3 (1) of the Fair Labor Standards Act, as amended, and no convict labor will be employed by the contractor in the manufacture or production of furnishings of any of the materials, supplies, articles, or equipment included in such contract; and".

SEC. 4. Section 2 of the Walsh-Healey Act, as amended, is amended to read as follows:

"SEC. 2. That any breach or violation of any of the representations and stipulations in any contract for the purposes set forth in section 1 hereof shall render the party responsible therefor liable to the United States of America for liquidated damages, in addition to damages for any other breach of such contract, the sum of $10 per day for each child knowingly employed under a condition of oppressive child labor in the performance of such contract, and for each convict laborer knowingly employed in the performance of such contract, and a sum equal to the amount of any deductions, rebates, refunds or underpayment of wages due to any employee engaged in the performance of such contract; and, in addition, the agency of the United States entering into such contract shall have the right to cancel same and to make open-market purchases or enter into other contracts for the completion of the original contract, charging any additional cost to the original contractor. Any sums of money due to the United States of America by reason of any violation of any of the representations and stipulations of said contract set forth in section 1 hereof may be withheld from any amounts due on any such contracts or may

be recovered in suits brought in the name of the United States of America by the Attorney General thereof. All sums withheld or recovered as deductions, rebates, refunds, or underpayments of wages shall be held in a special deposit account and shall be paid, on order of the Secretary of Labor, directly to the employees who have been paid less than minimum rates of pay as set forth in such contracts and on whose account such sums were withheld or recovered: Provided, That no claims by employees for such payments shall be entertained unless made within one year from the date of actual notice to the contractor of the withholding or recovery of such sums by the United States of America: Provided further, That no sums of money shall be withheld nor shall any suit be brought under this section on account of any violation of any of the representations and stipulations of a contract the final shipment under which was made more than two years prior to service upon the contractor of a complaint and notice of hearing alleging such violations, as provided in section 5."

SEC. 5. The last sentence of section 6 of the Walsh-Healey Act, as amended, is amended to read as follows: "Whenever the Secretary of Labor shall permit an increase in the maximum hours of labor stipulated in the control Act, he shall set a rate of pay for any overtime, which rate shall not be less than one and one-half times the regular rate at which the employee affected is employed (as such rate is defined and delimited by section 3 (n) of the Fair Labor Standards Act as amended)."

PART IV

EFFECTIVE DATE

SEC. 7. (a) The amendments hereby made to sections 6, 13, and 14 of the Fair Labor Standards Act shall take effect one hundred and twenty days after the enactment of this Act. During such one-hundred-and-twenty-day period the terms and conditions included in any wage order heretofore issued shall remain in effect unless and until superseded by a subsequent order of the Administrator. (b) Except as provided in subsection (a), the provisions of this Act shall take effect upon its enactment and shall apply to all causes of action upon which a final judgment has not theretofore been rendered.

(c) Nothing contained in this Act shall be deemed to modify or repeal any provision of the Portal to Portal Act of 1947 or to render any provision thereof inapplicable to any cause of action arising prior to, on, or subsequent to the effective date of this Act.

Senator BALL. Senator Pepper.

STATEMENT OF HON. CLAUDE PEPPER, A UNITED STATES SENATOR FROM THE STATE OF FLORIDA

Senator PEPPER. Mr. Chairman, I shall take only a very short time of the subcommittee to make a few observations.

Of the many bills pending before this subcommittee on the subject of the Fair Labor Standards Act, I note that S. 2062 of which I am one of the cosponsors, and S. 2386 are the most comprehensive. Both of these bills would

(1) revise the minimum wage upward and amend the overtime pay provisions of the act.

(2) change the coverage and exemptions under the act.

(3) alter the provisions against the employment of oppressive child labor.

S. 2062 would establish a 75 cents an hour minimum wage and would permit a minimum of $1 per hour, when recommended by an industry committee for a particular industry. S. 2386 would establish a 60 cents minimum wage and would authorize an industry committee to recommend a minimum as low as 50 cents or as high as 70 cents an hour for a particular industry.

The first bill would at least restore the standard of living contemplated by Congress for our lowest-paid workers when it set a 40-cent minimum wage. The second bill does not raise the legal minimum even as much as the rise in the cost of living since 1941, which is now almost 70 percent, above 1944-the 40-cent level which Congress considered inadequate even then. In fact, the national floor under wages in S. 2386 would be 50 cents instead of the proposed 60 cents.

S. 2062 would extend its minimum wage and overtime pay provisions to several million more workers. S. 2386, by attempting to clarify congressional intent, increases the scope of the exemptions from these provisions, thereby removing about 1 million workers from their protection.

The first bill would extend a prohibition against the employment of oppressive child labor to all activities affecting interstate commerce, while S. 2386 merely prohibits such employment in establishments now covered by the act.

It seems to me that Congress should extend the protection of its social legislation to as many people who need it as will be permitted by the Constitution and as may be warranted by conditions of the times. This is particularly true of the Fair Labor Standards Act. As the Supreme Court in its opinion in 1943 in Walling v. Jacksonville Paper Co. said:

It is clear that the purpose of the act was to extend Federal control in this field throughout the farthest reaches of the channels of interstate commerce. I shall only like to conclude by citing a few facts which provide the setting for this hearing

1. The 40 cent minimum wage was never considered by the Congress at the time of its adoption to be sufficient to provide a decent minimum American standard of living. In fact, it was recognized as wholly inadequate.

2. Since 1941, when the 40 cent minimum became effective for most workers covered by the Act, the cost of living has risen almost 70 percent.

3. Based upon this rise in the cost of living, the legal minimum should be increased to 68 cents. But a cost of living increase should not be the sole justification for the establishment of a minimum wage level. Our committee in 1946 in its report on S. 1349 showed that some consideration must also be given to the use of cost of living budgets as criteria in determining what wage rate will eliminate substandards of living.

4. Budgetary studies by the Treasury Department show that in 1947, 75 cents an hour, or $1,560 a year at full time employment, would provide only a very modest standard of living for a single individual living alone. It would be far below the amounts required for family units of any larger size.

5. The income of unincorporated enterprises, including farmers, was 40.5 billion dollars in 1947 or 20 percent of our national income, the highest proportion since 1929. Corporations received in net income before taxes, 28.7 billion dollars, 11.3 percent of the national income, the highest proportion except for 1929 and the war years.

6. In manufacturing industries there are fewer than 1,300,000 workers receiving less than 75 cents an hour or only 10 percent of the total, in comparison with 3,850,000 or about one-third of the total in 1946.

Senator BALL. We shall be pleased to hear now from Mr. William R. McComb, Administrator of the wage and hour law in the United States Department of Labor. Mr. McComb.

STATEMENT OF WILLIAM R. McCOMB, ADMINISTRATOR, ACCOMPANIED BY HARRY WEISS, DIRECTOR, WAGE DETERMINATION AND EXEMPTION BRANCH, WAGE AND HOUR AND PUBLIC CONTRACTS DIVISION, UNITED STATES DEPARTMENT OF LABOR, AND HAROLD C. NYSTROM, CHIEF, INTERPRETATIONS BRANCH, OFFICE OF THE SOLICITOR OF LABOR, UNITED STATES DEPARTMENT OF LABOR

Mr. McCOMB. Mr. Chairman, I would like at this time to ask permission to read a statement I have. I realize it is a little long, but I think that is the only way I can present the matter, and I also ask permission that in the questioning, as we did before the House committee, that Mr. Weiss, our economist, and Mr. Nystrom, my lawyer, may be here to assist me in answering when questions come up. Senator BALL. Very well.

Mr. McCOMB. Mr. Chairman and members of the committee, this is my first opportunity as Administrator of the Wage and Hour and Public Contracts Divisions to appear before a subcommittee of the Senate Committee on Labor and Public Welfare to discuss proposals to revise the Fair Labor Standards Act of 1938. There have been a considerable number of proposals introduced on this subject in the present Congress but I believe that it will simplify the discussion if I direct my comments to only two of these bills: S. 2062, introduced by Senators Thomas, Pepper, Chavez, Green, Magnuson, McGrath, Murray, Myers, Taylor, and Wagner; and S. 2386, introduced by Senator Ball. I believe these bills touch on practically all the provisions which would be changed by the proposals introduced in the current session of Congress.

I shall begin by listing the principal amendments which it seems to me, as Administrator, most urgently require legislative action and then shall review both S. 2062 and S. 2386 in the light of these recommendations. I shall then discuss other features of these two bills. I shall not, in my oral statement, discuss all of the technical details concerning these bills but, with the committee's permission, I should like to file with it a supplement to my oral statement which will go into these technical details and which will also elaborate on some points of my oral statement. I shall appreciate it if this supplement to my statement appears immediately after my statement in the record. I earnestly recommend to this committee and to the Congress that the following amendments to the Fair Labor Standards Act be enacted during the present session of this Congress.

1. First, and most important, that the Congress revise and bring up to date the outmoded minimum wage requirements of the Fair Labor Standards Act. I am convinced that a 75-cent statutory minimum is now both feasible and necessary to carry out the basic objectives of this legislation.

2. That the child labor provisions of the Fair Labor Standards Act be extended to activities in interstate commerce and that there be a

direct prohibition of oppressive child labor both in commerce and in production of goods for commerce.

3. That the agricultural and fish processing exemptions contained in the act be completely revised by eliminating entirely section 7 (c), the "area of production" exemption in section 13 (a) (10), as well as that portion of the section 13 (a) (5) relating to onshore operations of fish processing or handling. The complete exemption for offshore fishing operations would be retained; the deleted exemptions would be replaced by a broadened seasonal overtime exemption under section 7 (b) (3) of the act so as to permit all of the industries heretofore given these other exemptions to be eligible for a seasonal overtime exemption.

4. That the minimum wage provisions of the act be extended to

seamen.

5. That the overtime exemption for motor carrier employees be modified so that all such employees would be covered either under the overtime provisions of the Fair Labor Standards Act or under the hours of service regulations of the Interstate Commerce Commission issued pursuant to the Motor Carriers Act.

6. That the Congress clarify the term "regular rate of pay."

7. That the exemption for retail and service establishments contained in section 13 (a) (2) be clarified.

8. That section 7 (b) (2) be revised to offer greater encouragement to the development of annual employment agreements.

9. Finally, that the act be amended to grant the Administrator direct authority to issue interpretative regulations and authority to regulate industrial homework.

These are the changes in the law which I believe are most urgent. There are, of course, a good many other changes in the law which would be desirable, particularly the extensions of coverage provided

for in S. 2062.

Senator PEPPER. What you contemplate, what you recommend, therefore, is a broadening and a progressive extension of the provisions of the law rather than a curtailment and restriction?

Mr. McCOMB. That is right. I shall now make a brief comparison of the two major bills, S 2062 and S. 2386, in relation to the recommendations which I have listed and then proceed with a more detailed discussion of some of the major problems raised by the two measures. 1. Insofar as minimum wage revision is concerned, it is my conviction that S. 2062 is substantially more effective in carrying out the necessary revision of the act than is S. 2386. Not only are the rates in S. 2386 substantially below the amount which I believe is necessary and feasible under current economic conditions, but it contains substantial changes in the industry committee procedure which makes it difficult. to achieve even the low upper limit permitted by the bill. I shall discuss these changes at a later point in this statement.

Senator THOMAS. Mr. Chairman, while there is an interruption, I believe it would be a good idea for the committee to spend just a half a minute in getting the historical background in regard to the Fair Labor Standards Act and its general objectives.

After the passage of the National Labor Relations Act, and after it was declared to be in accordance with our Constitution by the Supreme Court, organized labor was able to take care of itself; nevertheless,