Mr. RAMEL. Well, I think is is well over 75 cents. I can't speak with any authority. Senator BALL. Any more questions? No? Thank you. Mr. RAMEL. Yes, sir. (Subsequently Senator Pepper submitted the following statement with reference to Mr. Ramel's second point on the definition of executives:) THE TAFT-HARTLEY DEFINITION OF "SUPERVISOR" SHOULD NOT BE SUBSTITUTED FOR THE DEFINITION OF "EXECUTIVE" IN THE FAIR LABOR STANDARDS ACT * Section 13 (a) (1) exempts from the wage and hour provisions of the Fair Labor Standards Act "any employee employed in a bona fide executive capacity (as such terms are defined and delimited by regulations of * the Administrator)." After careful study of the problem and elaborate hearings the Administrator has issued regulations defining the term "executive." These regulations define "executive" to include any employee. "(A) whose primary duty consists of the management of the establishment in which he is employed or of a customarily recognized department or subdivision thereof, and "(B) who customarily and regularly directs the work of other employees therein, and "(C) who has the authority to hire or fire other employees or whose suggestions and recommendations as to the hiring or firing and as to the advancement and promotion or any other change of status of other employes will be given particular weight, and, "(D) who customarily and regularly exercise discretionary powers, and "(E) who is compensated for his services on a salary basis at not less than $30 per week (exclusive of board, lodging, or other facilities), and "(F) whose hours of work of the same nature as that performed by nonexempt employees do not exceed twenty percent of the number of hours worked in the workweek by the nonexempt employees under his direction; provided that this subsection (F') shall not apply in the case of an employee who is in sole charge of an independent establishment or a physically separated branch establishment." This definition is not only the product of careful and expert administrative consideration, the courts in literally scores of cases have approved the definition and have interpreted its various parts so that today it is a clear and workable definition of the term "executive." It is now proposed to scrap this definition and to substitute in its stend the definition of the term "supervisor" as contained in the Taft-Hartley Act. As defined in that act, the term "supervisor" means any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibly to direct them, or to adjust their grievances, or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment. The purpose of those who seek to substitute a new definition for that which now obtains under the Fair Labor Standards Act is quite clear. They obviously hope that a broader definition of the exempt group of "executives" will deprive a larger group of employees of the benefits of the Fair Labor Standards Act. Such a substitution of terms would be most unfortunate and would deprive literally thousands of employees of the existing overtime protections of the law. Here are a few reasons why such a substitution is unsound: 1. The term "executive" means something wholly different from the term "supervisor." The first term describes an economic relationship to manage ment; the second describes primarily a functional relationship to management. The first term is obviously much narrower than the second. The effect of substituting the definition of the term "supervisor" in the Taft-Hartley Act for the administrative definition of the term "executive" in section 13 (a) (1) of the Fair Labor Standards Act would be to amend the Fair Labor Standards Act and to change its meaning. 2. Such a change in meaning would be, moreover, wholly unrelated to the purposes of the Fair Labor Standards Act and would impose upon the Fair Labor Standards Act a term which has meaning only in a law dealing with labor relations. The term "supervisor," as contained in the Taft-Hartley Act, was evolved for two purposes. In the first place, the term was designed to identify those who by virtue of their position in the managerial hierarchy could convey to the rank and file employees an indication of management preference. It was intended by this term to furnish the Labor Board with a guide for determining which individuals could properly be regarded by rank and file workers as conveying the authority and the wishes of management. The purpose of the definition was to determine under what circumstances mangement could be charged with responsibility for unfair labor practices. In the second place, this definition was written into the Taft-Hartley Act in order to define the class of employees who were excluded from the protections of the Taft-Hartley Act with respect to self-organization and collective bar gaining. It was the judgment of Congress in laying down this definition that the employees so defined were subject to divided loyalties and could not properly be protected in their right to self-organization and collective bargaining. But the fact that an employee may not be protected with respect to self-organization and collective bargaining is no reason for denying him the protection of the Fair Labor Standards Act. As a matter of fact, the very fact that these individuals are excluded from the protections of the Taft-Hartley Act emphasizes the importance of including them within the safeguards of the Fair Labor Standards Act. 3. It was the intention of Congress in writing section 13 (a) (1) to limit the exemption to those who were primarily identified with management "in a bona fide executive ** * * capacity." But the working foremen and supervisors which prevail in mass production industries who might conform to the definition contained in the Taft-Hartley Act are obviously not "executives" in any sense of the word. The mere right to supervise others does not by any stretch of the imagination convert an individual into an executive. 4. As noted above, the administrative definition of the term "executive" has been examined and approved in scores of cases. Its meaning is clear to American employers. To substitute the definition of "supervisor" newly written into the Taft-Hartley Act would create uncertainty and confusion. 5. The Fair Labor Standards Act is a remedial statute. It should be broadly construed in order to give its purposes as broad an effect as possible. Foremen and other supervisory personnel are subjected to all of the evils which the act was designed to remedy. Nor do they enjoy the rewards of true executive personnel. Since the executive exemption is an exception to the statute, it must be construed as narrowly as possible so as to give effect to the remedial statutory purpose. The attempted substitution in definition would construe the exemption far more broadly than its language warrants. Senator BALL. We will recess until 10 a. m. tomorrow morning. (Whereupon, at 3:40 p. m., the subcommittee adjourned until 10 a. m., April 27, 1948.) X 7 HEARINGS BEFORE A SUBCOMMITTEE OF THE COMMITTEE ON LABOR AND PUBLIC WELFARE UNITED STATES SENATE EIGHTIETH CONGRESS SECOND SESSION ON S. 49, S. 154, S. 160, S. 161, S. 557, S. 731, S. 1048, S. 1076, BILLS TO AMEND THE FAIR LABOR STANDARDS ACT PART 2 APRIL 27, 28, 29, 30, MAY 3 AND 4, 1948 Printed for the use of the Committee on Labor and Public Welfare |