fine under a Kansas law for violating the hour provisions, the statute was upheld. Although at that time maximum hour legislation was regarded as repugnant to the due process clause (see Lochner v. New York, 198 U. S. 53), the Court said: "It cannot be deemed a part of the liberty of any contractor that he be allowed to do public work in any mode he may choose to adopt without regard to the wishes of the State. On the contrary, it belongs to the State, as the guardian and trustee for its people in having control of its affairs, to prescribe the conditions upon which it will permit public work to be done on its behalf, or in behalf of its municipalities." When the Federal 8-hour law was contested (act of Aug. 1, 1892, 27 Stat. 340, U. S. C., ti. 40 sec. 321), the offending contractor sought to distinguish the power of the Federal Government from that of the States. The court, however, sustained the Federal statute, observing: "The contention that the act is unconstitutional is not frivolous, since it may be argued that there are relevant distinctions between the power of the United States and that of a State. But the arguments naurally urged against such a statue apply equally for the most part to the two jurisdictions, and are answered so far as a State is concerned by Atkin v. Kansas We see no reason to deny to the United States the power thus established for the States. 66* ** The fact that Congress has not general control over the conditions of labor does not make unconstitutional a law otherwise valid, because the purpose of the law is to secure to it certain advantages, so far as the law goes." Minimum wage legislation by the States with respect to employment on State, county, and municipal public works construction under contract has been upheld in several prevailing wage cases, Campbell v. New York (N. Y., 155 N. E. 628); Ruark v. International Union of Operating Engineers (Ind., 146 A. 797). The Supreme Court has also upheld the New York statute excluding aliens from employment of public works, although at the same term of court it had invalidated a State statute discriminating against aliens in ordinary employment. (Compare Heim v. McCall, 239 U. S. 175 (1915) and Crane v. New York, 239 U. S. 195 (1915) with Truex v. Raich, 239 U. S. 33 (1915)). Since then the doctrine has become so settled that the question is no longer open in the Supreme Court. Thus appeals from decisions sustaining, respectively, provisions giving preference in civil service to disabled veterans and restricting employment on public works to qualified voters were dismissed for want of a substantial Federal question. (See Caldwell v. Louisiana, 282 U. S. 801 (1930), dismissing State v. Caldwell, 170 La. 851 (1930) and Gianatasio v. Kaplan, 284 U. S. 595 (1932), dismissing Gianatasio v. Kaplan, 257 N. Y. 531 (1932).) (See also the opinion by Attorney General Stone in 34 Op. Att. Gen. 257.) 3. An attempt has been made at this hearing to distinguish contracts for public works (where it is apparently conceded that the application of the Federal prevailing wage law and the 8-hour law is valid) from contracts for supplies or services and the right to insist on certain labor standards. The point was raised that contracts for public works are performed on Federal land and hence are entirely within Federal jurisdiction. This argument overlooks two factors: (a) That a construction contract on Federal property is also within the jurisdiction of State labor laws. It has been repeatedly held that a State workmen's compensation act is applicable to employees of a contractor erecting a building for the United States. See Lynch's Case (281 Mass. 383, 183 N. E. 833). (b) Decisions upholding the 8-hour laws and other statutes of this character show that nothing turned upon the question of whether these contracts were performed upon public land or not. The language indicates that the constitutional basis was the fact that the statutes under review dealt with Public Contracts. The quotation from the Atkin case (supra) illustrates this point thoroughly. In sustaining the Federal 8-hour law Mr. Justice Holmes said: "Congress, as incident to its power to authorize and enforce contracts for public works, may require that they shall be carried out only in a way consistent with its views of public policy, and may punish a departure from that way. It is true that it has not the general power of legislation possessed by the legislatures of the States, and it may be true that the object of this law is of a kind not subject to is general control. But the power that it has over the mode in which contracts with the United States shall be performed cannot be limited by a speculation as to motives." (Ellis v. United States, 206 U. S. 246, 257, 1907). It should also be remembered that the Federal 8-hour law (act of Aug. 1, 1892, ch. 352, 27 Stat. 340, U. S. C., title 40, sec. 321) was supplemented in 1912 by an 8-hour law applying to all public contracts except those specifically exempted (act of June 19, 1912, ch. 174, 37 Stat. 137, U. S. C., title 40, sec. 324, 325). It has been held that this section applies to contracts for the manufacture of smokeless powder, the purchase of projectiles (1912, 29 Op. Atty. Gen., 531), and the construction of battleships and colliers (id. 371). 4. The foregoing considerations dispose of the argument that the Healey bill is open to the same objections as the codes of fair competition condemned by the Supreme Court in United States v. Schechter Poultry Corp. (259 U. S. 495). In that decision Chief Justice Hughes said: "The further point is urged that the national crisis demand a broad and intensive cooperative effort by those engaged in trade and industry, and that this necessary cooperation was sought to be fostered by permitting them to initiate the adoption of codes. But the statutory plan is not simply one for voluntary effort. It does not seek merely to endow voluntary trade or industrial associations or groups with privileges or immunities. It involves the coercive exercise of the law making power. The codes of fair competition which the statute attempts to authorize are codes of laws. If valid, they place all persons within their reach under the obligation of positive law, binding equally those who assent and those who do not assent." The Healey bill does not contemplate imposing positive law upon persons who do not assent. Only persons who signify their acceptance of these provisions by submitting bids pursuant to specifications containing the labor provisions or by accepting Government work from the principal contractor are bound by these conditions. Moreover it has frequently been held that the Court will not pass upon the constitutionality of a statute at the instance of one who has availed himself of its benefits. Great Falls Mfg. Co. v. Attorney General (124 U. S. 581); Wall v. Parrot Silver & Copper Co. (244 U. S. 407, 411-412); St. Louis Malleable Casting Co. v. Pendergast Construction Co. (260 U. S. 469). 5. The objection to the bill on the score of unlawful delegation of legislative authority is not well taken. It has been stated at the hearing that the minimum wage standards contained in section 9 of the bill were taken verbatim from the minimum wage law of New York State. This is true. It is also true that the New York act was held unconstitutional by the New York Court of Appeals in a four to three decision. See People ex rel. Tipollo v. Morehead, - N. Y. [1936]. An examination of the majority opinion fails to reveal, however, that in so doing the court "specifically held that the socalled standards in the act were not in effect standards in the legal sense." What the court said was that the standards in the New York act differed only "in phraseology and not in principle" from the standards contained in the District of Columbia statute invalidated by the Supreme Court in Adkins v. the Children's Hospital (261 U. S. 525), on the theory that the statute therein reviewed was an unconstitutional interference with liberty of contract. In other words the Adkins case turned entirely upon a construction of the due process clause. It had nothing to do with the question of unlawful delegation of power. The New York decision is based entirely on the authority of the Adkins case and has now been docketed for review in the United States Supreme Court. It is obvious that if the New York case was based upon delegation of power the only question thereby presented would arise under the New York Constitution and, therefore, there would be no Federal question upon which the Supreme Court could pass. Assuming, however, that even if the New York decision had been based upon a holding of unlawful delegation of legislative authority that decision would still be irrelevant. For reasons already discussed the basis of this bill is not the regulatory power of the Government since it binds only those who consent to it. The fixing of standards once an appropriation has been granted is entirely within the scope of executive discretion. An examination of the authorities cited has shown that the only curb on this discretion is another statute of the Federal Government and not the Constitution. The purpose of having a section like section 9 in the Healey bill is not to make it any sounder from a constitutional standpoint but simply to lay down congressional instructions to the administrative agency respecting its exercise of discretion. In other words these standards are analagous to those contained in title 2 of the National Industrial Recovery Act requiring the payment of just and reasonable wages (act of June 16, 1933, sec. 206; 48 Stat. 205). Under this section the wage regulations of the Public Works Administration, whose validity has never been questioned, were promulgated. (See also sec. 7 of the Emergency Relief Appropriation Act of 1935, 49 Stat. 115, 118.) Mr. HEALEY. I believe that this concludes the testimony of the persons who desire to be heard. Mrs. BETTY GRAM SWING. Is there to be a further hearing on this bill? Mr. HEALEY. No; we are going to conclude our hearings. Mrs. SWING. Could you hear Dr. Oatman for just a minute? STATEMENT OF DR. MARIAM E. OATMAN, REPRESENTING THE NATIONAL WOMEN'S PARTY Dr. OATMAN. I come as a friend of the bill, in principle, and for that reason I think that some of the administrative features should be changed because, as it stands, I do not believe that the bill will survive the courts. It gives to the same person, the Secretary of Labor, a definite power of sublegislation in the making of rules and power to make exceptions, and power to provide for the administration of those rules, as well as the judicial power to pass on the question as to whether a given contractor has or has not complied with the rules. That seems to me to be a practical impossibility under our system of government, and I believe that section 7, instead of authorizing the Secretary of Labor or her representative to hold hearings, should establish a board for the purpose of a quasi-judicial review of controversies arising. I thank you. Mr. HEALEY. I think that that is all now, and the hearings are concluded. (Thereupon, at 5:45 p. m., the hearings were concluded.) STATEMENT SUBMITTED BY ASSOCIATED GROCERY MANUFACTURERS OF AMERICA A 1. This is a statement in behalf of the Associated Grocery Manufacturers of America, Inc., located at 205 East Forty-second Street, New York City. 2. It is a national association of grocery manufacturers. Its membership includes leading and representative manufacturers of foods and other grocery products sold in package form throughout the country. B 3. This bill is a substitute for the Walsh bill (S. 3055). The latter bill has passed the Senate; but it has been tabled by this committee. Its purpose is described in the report thereon by the Senate Committee on Education and Labor as follows: "The purpose of the bill is to direct Government purchases along lines tending to maintain the advance in wages and purchasing power achieved under the N. R. A. Its effect will be to set a standard of wages and hours of labor which otherwise is threatened in view of the abandonment of N. R. A. It will end the present paradoxical and unfair situation in which the Government, on the one hand, urges employers to maintain and uphold fair wage standards and, on the other hand, gives vast orders for supplies and construction to the lowest bidder, often a contractor or manufacturer who does not sympathize with and fights hardest against labor and social welfare policies" (S. Rept. No. 1157, 74th Cong., 1st sess.). 4. To effectuate this purpose the Walsh bill requires that a contract for the sale of supplies to the Government shall contain an agreement by the seller that his employees engaged in the production or furnishing of such supplies have been paid (since the effective date of this act) not less than the minimum rates of pay and employed not exceeding the maximum hours specified on May 26, 1935, by applicable and approved N. R. A. code or, in the absence thereof, by applicable President's Reemployment Agreement; and that said employees will be paid not less than such minimum rates of pay and employed not exceeding such maximum hours as shall be designated in the invitation to bid; etc. 5. The report by the aforesaid Senate committee further states: "The bill has been prepared upon the theory that Congress has power to prescribe conditions in public contracts, loans, or grants, and adopt such policies as conditions in them and to direct or authorize the President with respect to their effectuation. Decisions of the Supreme Court bear out this policy. The committee believes that in the absence of action by Congress, the Executive has power to require any condition in contracts, loans, or grants necessary to protect the United States but that his authority stops there and that matters of general policy not strictly necessary to secure to the United States the performance of a contract can only be laid down by Congress. "In deciding to incorporate these particular provisions, the committee was guided by the following facts: "1. Many trades and industries, despite the Supreme Court decision in the Schechter case which set aside N. R. A. Codes, have to a considerable extent continued to adhere voluntarily to the wage and hour provisions of such codes. The committee believes that this tendency should be encouraged and rewarded. "2. The wage and hour provisions contained in the recent N. R. A. codes provide an equitable ‘yardstick' for determining the proper minima, as to wages, and the proper maxima, as to hours, that should be required by the Government in connection with contracts involving the use of Federal funds. The establishment of these code wage and hour provisions was the result of exhaustive study of nearly 2 years by the National Recovery Administration in collaboration with representatives of industry and labor. In each instance, code wage and hour provisions were determined only after exhaustive hearings, participated in by a majority representation of the trade or industry involved, and in every case the trade or industry itself assented to the said provisions. The reference to code wage and hour provisions in the bill does not represent directly or indirectly, an attempt to revive N. R. A. codes of fair competition. It was deemed advisable, however, to use the code wage and hour provisions for the reasons above stated. "Both the Seventy-third and the Seventy-fourth Congresses have repeatedly committed themselves to the principle that American labor is entitled to a reasonable living wage, and that it should not be compelled to work more than a reasonable number of hours per day, week, or month. The Seventythird Congress, in section 1 of title 1 of the National Industrial Recovery Act, stated in part: "It is hereby declared to be the policy of Congress * * to increase the consumption of industrial and agricultural products by increasing purchasing power, to reduce and relieve unemployment, to improve standards of labor, and otherwise to rehabilitate industry * "This declaration of policy was reaffirmed by the Seventy-fourth Congress in Public Resolution No. 26 (S. J. Res. 113), approved on June 14, 1935. "Existing statutes require that Government contracts be let to the lowest responsible bidder on open competitive bidding. The operation of this statute was qualified as to wages and hours under the provisions of Executive Order No. 6646 of March 14, 1934. Subsequent to the issuance of this Executive order, borrowers, grantees, contractors, and subcontractors, on Government contracts were required to comply with the codes of fair competition to which they wer subject and in the absence of such codes, with the President's Reemployment Agreement. This procedure was found in actual experience, to be practical and workable and not productive of undue hardship upon industry. However, following the Supreme Court decision in the Schechter case, the operation of Executive Order No. 6646 was necessarily suspended. "Since the suspension of Executive Order No. 6646, the above statute has been construed as requiring an acceptance of the low bid without any limitations as to wage and hours except those contained in other Federal statutes such as the Adamson Act and Bacon-Davis Act. "Such construction commits the Government to the unconscionable practice of allowing private industry to dictate wages and hours of labor--no matter how oppressive for undertakings financed with Federal funds. The insistence of such standards on projects financed wholly or in part with Federal funds, should, in due course, encourage private industry voluntarily to adopt like standards in private undertakings, thereby increasing purchasing power and improving the general conditions of our citizens. "The committee believes that the enactment of this bill will aid materially in securing of industry recovery and the permanent adoption of the standards of wages and hours and conditions of labor set forth in the bill." с 6. The Healey bill was introduced on March 2, 1936. It is entitled "A bill to provide conditions for the purchase of supplies and the making of contracts by the United States, and for other purposes." It contains 15 sections. 7. Section 1 requires that a contract for the sale of supplies to the Government, in an amount exceeding $2,000, shall contain an agreement by the seller that his employees engaged in the production or furnishing of such supplies will be paid not less than such minimum rates of pay and employed not exceeding such maximum hours as shall be designated in the invitation to bid; and that no person under 16 years of age and no convict labor will be employed in the production or furnishing of such supplies. 8. Section 2 imposes the same requirement with respect to pertinent subcontracts by the seller. Section 3 stipulates that every aforesaid agreement shall provide that its violation shall render the party responsible therefor liable to pay liquidated damages in (a) a sum equal to twice the difference between the amount required to be paid to employees, including the amount required to be paid for excess overtime, and the amount actually paid; and (b) the sum of $10 per day for each employee under 16 years of age. That it shall also provide that the exaction of any refunds or kick-backs of wages from employees shall render the responsible party liable to pay liquidated damages in a sum equal to five times the amount of such refund. And that it shall further provide that the violation of such agreement shall entitle the Government to cancel this purchase contract and to make equivalent open-market purchases and to charge any resulting additional cost to the party violating the agreement; etc. 9. Section 6 authorizes the Secretary of Labor to create in the Department of Labor a unit for administering this act. Section 7 authorizes the Secretary of Labor or his representative to hold hearings and to require the attendance of witnesses and the production of evidence under oath at such hearings, upon his own motion or on complaint of violation of an aforesaid agreement. It provides that the Secretary shall make findings of fact after notice and hearing, which, if supported by evidence, shall be conclusive upon the courts. And it empowers the Secretary to make such decisions based upon findings of fact as are deemed necessary to enforce this act. Section 8 authorizes the Secretary of Labor to make exceptions respecting minimum rates of pay and maximum hours of labor in specific cases or otherwise under this act whenever such action shall be recommended by an agency of the United States and when justice or public interest will be served thereby. This section also provides that upon the joint recommendation of the governmental agency and the contractor, the Secretary may modify the terms of an existing contract respecting minimum rates of pay and maximum hours of labor as may be found necessary and proper in the public interest or to prevent injustice or undue hardship. It further specifies that the Secretary may provide reasonable limitations and may make rules and regulations allowing reasonable variations, tolerances, and exemptions to and from any or all provisions of this act or the extent of the application of this act to contractors, etc. 10. Section 9 stipulates that the minimum wages and maximum hours specified in any proposal or contract shall be determined by the Secretary of Labor; provided, however, that minimum wages fixed under this act shall be such wages as are fairly and reasonably commensurate with the value of the service or class of service rendered. This section then goes on to provide |