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during April and May. Included were Sharon Steel Corp. (affecting 5,000 workers in Sharon and Farrell, Pa., Lowellville and Warren, Ohio, and Dearborn, Mich.), Lukens Steel Co. (covering 4,000 workers in Coatesville, Pa.), and Hanna Mining Co. an operating agent for some major steel producers for about 3,000 production and maintenance employees in its iron mining operations in Michigan, Minnesota, and Missouri.
Teachers. The New York City Board of Education and the United Federation of Teachers, bargaining for 40,000 regular teachers in the city's public schools, during May reached tentative agreement providing salary increases and working condition improvements estimated to cost $36 million a year. The settlement-reached after prolonged negotiations would provide salary increases ranging from $370 to $995 for teachers already on the payroll. Starting salaries for teachers with a bachelor's degree would be raised to $5,300 a year (from $4,800) and top pay-for teachers with 60 hours of credit beyond the bachelor's degree and 14 years of service-would amount to $10,445, instead of $9,450. The latter rate included a new $475 "promotional increment" for teachers with subject specialization, including all junior and senior high school teachers, that would affect immediately some 22,500 teachers. A $400 differential for teachers with a master's degree, and a second $400 for those with 30 credit hours beyond this degree would be continued. The agreement also provided about $6 million for such improvements in working conditions as reducing class sizes and "instructional loads." Final approval was subject to UFT membership ratification.
In addition, the Board announced plans for a $2,770,000 yearly increase in pay for about 5,000 day-to-day substitute teachers, who are not represented by the Federation.
Utilities. On May 29, the Communications Workers of America announced that under a wage reopening clause of a 3-year agreement, it had tentatively agreed on a wage increase with the Ohio Bell Telephone Co. that was expected to set the pattern in other wage reopeners for some 350,000 phone operators and service men in the Bell System. The Ohio agreement, affecting
15,500 employees, provided weekly increases, retroactive to May 8, ranging from $2 to $5 for plant workers and from $2 to $3.50 for traffic department employees. According to the union, the raises would average about 3.5 percent, or 8.2 cents an hour.
In a subsequent settlement, Illinois Bell Telephone Co. and the Communications Workers also agreed to raises averaging 3.5 percent (6.3 cents). They included increases ranging from $1.50 to $3 a week, affecting approximately 1,500 toll operators and clerks in Chicago, and 5,600 operators, clerks, supervisors, and other traffic workers elsewhere in Illinois. This settlement was also subject to ratification.
Other settlements patterned after the Ohio Bell agreement were reached in early June by the CWA with several Bell affiliates, including New Jersey Bell, Cincinnati and Suburban Co. (traffic units), the Wisconsin and Northwestern Bell companies, and the Chesapeake and Potomac Telephone Co.
Commonwealth Edison Co. of Chicago and 18 system local unions of the International Brotherhood of Electrical Workers representing approximately 9,200 workers, agreed to a 2-year contract. The settlement, subject to ratification, provided wage increases ranging from 6 to 12 cents an hour and averaging 10.1 cents, with a wage reopener in the second contract year. Other contract changes, which the union valued at about 2 cents an hour, included an additional 9 cents an hour for crew leader job classification schedules, an increase in the shift differential to 15 cents per hour (from 12 cents), extended vacations for longservice employees, and extension of funeral leave to include attendance at grandchildren's funerals.
Construction. On May 17, the Southern California District Council of the Hod Carriers', Building and Common Laborers' Union and four contractors' associations-the Associated Building Contractors Association of California, Inc., the Engineering and Grading Contractors Association, Inc., and the Home Builders Institute, Inc.-agreed to a 5-year contract covering about 35,000 laborers in southern California. The settlement called for increases in wages and supplementary benefits totaling 36%1⁄2 cents
See Monthly Labor Review, June 1962, pp. 681-682.
hour in the first 3 years (about 3.5 percent a year) and a contract reopening in 1965. In the first contract year, employers are to increase their contribution to the health and welfare fund by 2 cents an hour (for a total of 12% cents) and pay 10 cents an hour to establish a pension fund. A 10-cent-an-hour increase is scheduled for May 1, 1963, and 14 cents for the third year, both amounts to be allocated between wage increases and fringe benefits at the union's option.
In northern California, the unified bargaining front of the Northern California Construction Employers was apparently breached in late May when the Hod Carriers signed 3-year, 72-cent-anhour wage-fringe package contracts with two former member companies. Details were not reported, but based on the current general laborer rate of $3.225 an hour plus a 10-cent company contribution to a health and welfare fund, the increase would total 21.7 percent or almost 6.8 percent a year.
Failure to resolve contract differences with the employers' association had resulted in scattered walkouts by the Hod Carriers beginning around May 1, and by May 14 had caused employers to shut down operations, reportedly idling some 100,000-130,000 construction workers. The union was demanding a 95-cent package, whereas employers had proposed 44 cents, both over a 3-year period.
A 15-cent-an-hour wage increase for about 30,000 carpenters went into effect on June 1, 1962, under a 1-year contract agreed to in early May between the United Brotherhood of Carpenters and the Builders Association of Chicago. The agreement, bringing carpenter's scales to $4.23 an hour, covered projects in Cook, Du Page, and Lake Counties. It also called for employers to pay 5 cents an hour more to the union's welfare fund and another 5 cents for pensions (for total payments of 15 cents each). The 25-cent wage and fringe benefit package represents an increase of 5.8 percent over the previous contract.
The same employer association and the International Union of Operating Engineers on May 9 announced a 2-year, 40-cent-an-hour package agreement for about 4,000 engineers. The agreement called for increasing wage scales by 20 cents on June 1, 1962, and an additional 15 cents on June 1, 1963. The companies would also pay
10 cents an hour to the union's insurance fund (instead of 5 cents). Based on the previous scale of $4.40 an hour for crane operators, plus 5 cents for insurance, the contract represents an annual increase of about 4.4 percent.
The Michigan Road Builders' Association and the Carpenters union, representing highway and bridge construction workers, signed in May a 29-month agreement providing a 27-cent-an-hour package increase. The agreement called for wage increases of 9 cents effective May 7, 1962, and an additional 10 cents on September 1, 1963, and an employer contribution of 10 cents an hour, effective September 1, 1962, to establish a pension fund. If a pension plan is not set up by that date, however, the 10 cents is to be added to base rates. Previous rates of pay were not reported.
In Missouri, 3-year contracts providing wage increases totaling 45 cents an hour were negotiated on May 4 by three unions (the Teamsters, the Operating Engineers, and the Hod Carriers) and the Associated General Contractors of America, Inc. (Missouri chapter). The settlement called for a 7-cents-an-hour raise effective May 1, 17% cents more next year, and 20 cents on May 1, 1964. It covered operations in Missouri outside the St. Louis and Kansas City areas.
Rates for boilermakers, blacksmiths, and helpers on field construction jobs in Arkansas, Louisiana, New Mexico, Oklahoma, and Texas, will rise by about 2% percent a year under a 2-year contract concluded in April by the Boilermakers, Iron Shipbuilders, Blacksmiths, Forgers and Helpers Union and major industrial equipment contractors. The settlement, affecting about 9,000 workers, increased pay rates by 10 cents an hour, effective May 9, 1962, and provided another 10-cent raise a year thence, bringing journeyman scales to $4.10 an hour. Employer payments to pension and health and welfare funds remained the same.
Minimum Wage. Effective May 1, 1962, an amendment to Connecticut's minimum wage law raised the hourly minimum for restaurant and hotel workers by 15 cents to $1.15 an hour. At the same time, the allowable deduction for tips was raised from 35 to 40 cents an hour. The minimum is to be raised to $1.25 in May 1964. About 24,000 restaurant employees and 3,800 hotel workers are affected.
United Automobile Workers. The United Automobile Workers held its 18th constitutional convention in Atlantic City, N.J., May 4 to 10, 1962.o Delegates considered a variety of measures relating to job security, wages, and organizing. UAW President Walter P. Reuther, in his major address, focused attention on problems of economic growth and income distribution, urging that national economic programs be intensified to achieve "an economy of full employment and abundance" and to mobilize "maximum economic potentials." Until a "healthy balance has been achieved between labor income and nonlabor income," Mr. Reuther contended, "it is imperative, at least for the short run, that wages and salaries increase faster than the economy's normal potential for increasing productivity." However, a resolution incorporating Mr. Reuther's views reaffirmed the UAW's "historical policy" of seeking bargaining gains "out of the fruits of advancing technology and not through price increases," recognizing a balance between the "equity of workers, stockholders, and consumers."
Delegates approved a constitutional amendment to permit interest and dividends earned by the union's strike fund-expected to amount to $1.4 million a year—to be spent in assisting the organization of workers in foreign factories producing products competitive with goods made by UAW members in the U.S. and Canada. They also endorsed a campaign to organize white-collar workers in the automotive, farm equipment, and aerospace industries and approved a resolution calling for major "catchup" gains in wages, fringe benefits, and employment security in negotiations involving the UAW and aircraftmissile producers. In recognition of the changing nature of the aircraft industry, the UAW changed its name to "United Automobile, Aerospace, and Agricultural Implement Workers of America."
Clothing and Garment Workers. At the conventions of the Amalgamated Clothing Workers and the International Ladies' Garment Workers' Union, both held in Atlantic City during May, delegates approved resolutions calling for a 35-hour workweek. At the ACWA's 23d biennial conven
For details of the convention, see pp. 758-761 of this issue.
tion, May 14-18, President Jacob S. Potofsky said the union would demand a 35-hour workweek, at no loss in pay, beginning in 1963 for its members in the men's and boys' clothing industry, most of whom are on a 40-hour week. Most of them were already actually working from 35 to 37 hours; a shorter normal workweek, he said, would result mainly in increased overtime earnings. AFL-CIO President George Meany, speaking before the ACWA Convention, gave emphasis to the 35-hour workweek demand, stating that "unless we see the economic growth [of the Nation] step up beyond 2.5 percent, . . . I predict that the AFL-CIO will start a nationwide campaign for a 35-hour week with no loss in pay."
Delegates to the ILGWU's triennial convention, May 23-May 31, heard union president David Dubinsky call for a national 35-hour workweek "as an eminently practical device to provide additional employment and at the same time to add to and enhance the purchasing power of the Nation's wage earners and their families." Most of the ILGW members already have a standard 35-hour workweek. Mr. Dubinsky also urged that the Federal minimum wage be raised to $1.50 an hour.
Secretary of Labor Arthur J. Goldberg, in speaking before both conventions, reiterated the Government's belief that a shorter workweek was not the proper remedy for unemployment.
In other actions, the ACWA convention renominated President Jacob Potofsky and General Secretary-Treasurer Frank Rosenblum, who had no opposition, for 2-year terms and raised their salaries from $20,000 to $25,000 annually. An election referendum was scheduled for the summer. Mr. Dubinsky was elected to his 11th term as president of the ILGWU, and Louis Stulberg was reelected to his second term as secretarytreasurer. The convention also endorsed a resolution authorizing the ILGWU executive board "to take all available means to oppose" the Federation of Union Representatives, an organization of business agents and other staff members formed. in 1960.
Other Conventions. In other union conventions during May, discussion related mainly to collective bargaining and organizing. The United Furniture Workers and the Distillery Workers voted to set up strike funds. Delegates to the former
union's convention approved a 10-cent per capita monthly assessment to strengthen its financial reserves. The Distillery Workers raised monthly per capita dues to the international by 50 cents to $1.50 and set minimum local dues at $4; a fund of $400,000 to provide strike benefits of $25 a week was to be built up by a special assessment of 50 cents a month per member.
The United Packinghouse Workers also raised their per capita payments to finance increased organizing efforts and greater political action aimed at relieving the economic problems of its members in "the allied section of the organization where wages and benefits are lagging."
The Textile Workers Union of America, concerned with organizing southern textile workers, called for unions in the industry to end their "costly rivalries" and merge into "one dynamic organization." By resolution, the Convention directed the TWUA's executive council to establish a cooperative relationship with other textile unions, preparatory to planning merger steps. William Pollock, president of the TWUA, subsequently announced on June 2 that he had sent letters to six textile workers' unions in the United States and Canada urging "a single, all-embracing union."
At the convention of the Air Line Pilots Association which began in Miami on May 29, Capt. Charles H. Ruby was elected president, replacing Clarence N. Sayen, president since 1951, who was not a candidate for reelection." Capt. Ruby defeated Capt. John C. Carroll, ALPA vice president.
Other Union Developments
In New York City, on May 13, Teamster Joint Council 16 and the Management Hospitalization Trust Fund, in cooperation with Montefiore Hos
pital and Columbia University's School of Public Health and Administrative Medicine, established a 5-year program to improve the quality of hospital and medical care of some 45,000 Teamster members and their families. The program, estimated to cost $3,675,000 and financed entirely by employer payments to the union's welfare funds, followed a Columbia University study released on May 11 that criticized as "not good" the medical care received by 40 percent of hospitalized patients. Under the program, a special facility is to be set up at Montefiore Hospital and operated jointly by the hospital and Columbia to evaluate medical care received, to study relationships between patient, doctor, and hospital that might contribute to better care at a reasonable cost, and to provide specified diagnostic services and treatment of serious illnesses requiring surgery.
The International Typographical Union on June 1 released its official tally of the referendum for top officers held on May 16. Reelected were President Elmer Brown and incumbent officers of the union's Progressive Party. Mr. Brown defeated challenger Fred R. Hunt, Jr., by a vote of 47,677 to 30,645. Secretary-Treasurer William R. Cloud was returned to his post by 48,824 votes compared with 28,313 for John J. Conley. The union has about 105,000 members.
The Subversive Activities Control Board on May 4 declared the International Union of Mine, Mill and Smelter Workers (Ind.) was a Communistinfiltrated organization. The Board's decision would deprive the union of all rights and privileges under the National Labor Relations Act. The union, whose membership reportedly had declined from about 100,000 in 1959, to about 50,000 to 60,000, could appeal to the Federal courts.
1 See Monthly Labor Review, December 1961, p. 1376.
An article about the ALPA convention will appear in the August issue of the Review.
Book Reviews and Notes
EDITOR'S NOTE.-Listing of a publication in this section is for record and reference only and does not constitute an endorsement of point of view or advocacy of use.
Pricing Power and the Public Interest: A Study
Based on Steel. By Gardiner C. Means. New York, Harper & Brothers, 1962. 359 pp. $7.50.
In this challenging book, the father of the administered price concept and the star witness in recent Kefauver committee hearings analyzes the pricing power of big business. Using steel as a case study, he poses the central problem of how to control "private socialism" in Americahow to channel in the public interest the vast discretionary power of "collective enterprise." Though his diagnosis is brilliant, Means' prescription ("which involves neither the breakup of big business nor Government regulation of prices") is not likely to cure the disease.
The setting of the problem is familiar: in concentrated industries like steel, prices are not market-determined but administered; they are insensitive to shortrun fluctuations in demand and costs; they are maintained at rigidly inflexible levels over extended time periods; they tend toward uniformity within a framework of price leadership and "followership"; they are set with a view to attaining a predetermined longrun, average target rate of return rather than in response to shortrun profit maximizing considerations. This much of the Means' analysis comes as no surprise to students of oligopoly behavior.
But Means goes further. He attempts to relate the administration of prices (and wages) to the general level of prices, income, and employment. In the last 30 years, he observes, there have been five periods of sharply rising prices: two represented recoveries from depression (193237 and 1939-42); two were classical monetary
inflations (1946-48 and 1950-51); and one was an administered price inflation (1953-59). The last, Means says, has two distinctive characteristics: (1) it is a cost-push, not a demand-pull, inflation and (2) it is "likely to lead to a recession in business activity and unemployment unless it is followed by monetary expansion." It is a phenomenon which cannot be controlled by conventional countercyclical monetary and fiscal
In the vanguard of this administrative inflation was steel. Thus, between 1953 and 1959, finished steel prices increased 36.1 percent, metals and metal manufactures (including steel), 21.6 percent, the wholesale price index, 8.5 percent, and the wholesale price index excluding metals and metal manufactures, 1.5 percent. Put differently, the wholesale price level during this period increased primarily because of the upward pressure of steel prices, and would have increased even more had it not been for the moderating influence of farm and other market-dominated prices.
How much of the 36-percent rise in the steel index was "legitimate"? Of the total, Means concludes, "6% percentage points can be directly attributed to labor costs per unit of output and 21 percentage points to widened profit margins," whereas the remaining 8% percentage points represent increased materials costs and increased capital investment per ton. Therefore, "responsibility for the big increase in steel prices after 1953 rests primarily with steel management. . . . The crux of the matter is management's power to administer prices and the post-1953 rise in steel prices is a clear example of its use." According to Means, it represents an "illegitimate" and "irresponsible" use of such power.
What then are the policy recommendations? Means rejects the classical trustbusting solution on the grounds that big business is necessary for efficiency ("... big business is a good thing. It is here and here to stay.") and that 20 competitors are not likely to serve the public interest any better than 5. Means also finds Government price control an unpalatable solution-primarily because of the sad experience with independent regulatory commissions. Instead, he proposes to give corporate managers in highly concentrated industries a tax-privileged bonus for setting target rates of return at levels consistent with