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mittee and have only been home in the last 3 2 weeks about 6 days, and that only on Sunday, and I received this letter.
Senator Davis. You are telling them as a Government employee rather than a manufacturer.
Mr. Hook. No, Senator, I am not. The Durable Goods Industries Committee was elected by the Code Authority of the Durable Goods Industries at the request of General Johnson, so we are simply advisory to the general, or trying to find for him an answer to some of the problems which he has before him, and I will have something to say about that with respect to this bill, too, but here is a letter which illustrates the kind of compulsion there is in the industry with respect to the employees' representatives. This was sent to me at the Mayflower Hotel. It says:
Dear Mr. Hook (from the employee representative, finishing mill): Due to the fact the committee was discussing the Wagner bill, and thought you would be interested to know how our committee felt that had worked under both plans, union and employee representation, and now we are 100 percent against the Wagner bill, and hope you are successful in defeating it, as we are very thankful of what you are doing.
Now, I had not any more idea that was coming to me than you. That is signed by the committee in the sheet mills department, representing that group of some 700 men. I think some of these men will be here tommorrow and you will have an opportunity to question them and determine for yourselves whether what I have said to you is the truth or not.
The CHAIRMAN. The letter may be inserted in the record. (The letter referred to is as follows:)
MIDDLETOWN, Ohio, March 19, 1934. DEAR MR. Hook (from the employee representative, finishing mill): Due to the fact the committee was discussing the Wagner bill, and thought you would be interested to know how our committee felt that had worked under both plans, union and employee representation, and now we are 100 percent against the Wagner bill and hope you are successful in defeating it as we are very thankful of what you are doing. Yours truly,
John R. WATSON.
CHAKNUM Essig. Mr. Hook. In order to tie up what I was saying to you, I will have to duplicate what I have said.
I bring this to your attention because Mr. Green and others have stated before this committee that plans of employee representation, to which they refer as “company unions”, are dominated and controlled by company officials.
I deny the truthfulness of their statements and challenge the sup, porters of this bill to urge upon Congress a thorough and impart al investigation by a qualified congressional committee authorized 0 report upon the entire field of employment relations as contained i the petition presented to Congress at the opening of this session by the National Association of Manufacturers.
I offer this case and the articles by Harold Seidman which appeared in the Nation last August as evidence of the necessity for Congress to hold labor-union officials and their agents responsible for their acts in the same manner in which management is prohibited from practicing unfair and coercive methods. And I offer these. The CHAIRMAN. They may go into the record. (The papers referred to by Mr. Hook are as follows:)
(From the Nation, Aug. 16, 1933) LABOR RACKETEERING-How CORRUPT UNION LEADERS HAVE BETRAYED THE
RANK AND FILE
(By Harold Seidman) The National Industrial Recovery Act forces employers to be fair in their dealings with labor, but what is going to protect labor from the tyranny of corrupt leaders who have long ruled over many unions? A Tammany sachem could not do a more thorough job than the labor bosses who reign supreme by means of gangsters, graft, machine-made constitutions, and judiciously distributed patronage. Under the leadership of these unscrupulous Officials both local and international, every known type of racketeering flourishes. Most of the union czars have risen from the ranks. Once in power they are confronted by numerous temptations. They have the characteristic American love for easy money, and politicians and equally corrupt employers are willing to supply them with plenty of it in return for "favors.". Unfortunately, union leadership in this country is for the most part notoriously lacking in social conscience, and more often than not union officials use their position to further their own interests.
Tribute exacted from both the employers and union members swells the already oversized incomes of labor racketeers who, according to Federal estimates, are intrenched in 47 trades. Protesting victims are soon silenced by strong-arm squads, and the czar's political influence is usually sufficient to quash any court action. To date only two of these racketeers have been brought to justice. Sam Kaplan, president of local 306 of the Motion Picture Operators, was found guilty of coercion, and Patrick J. Commerford of the Union of Operating Engineers, a Tammany leader, ran afoul of that bugaboo of all racketeers—the income-tax law.
The salaries paid to the union officials are out of all proportion to the service they perform. Sam Kaplan, who spent 1 or 2 days a week in the union office, received $21,800 a year, and his successor, Harry Sherman, was granted a salary of $18,000. No previous president of local 306 had ever received more than $250 a year. P. J. Morrin, president of the International Association of Bridge, Structural, and Ornamental Iron Workers is paid $15,000 a year, all necessary expenses, and $12 a day for daily expenses. Louis Kaufmann, business agent of local 244 of the Motion-Picture Operators is said to receive $14,000 a year. Although the majority of the union members are now unemployed, the salaries have not been reduced during the depression.
In addition to their salaries, the czars receive other monetary benefits from the union. Over a 5-year period Kaplan was "voted gifts” amounting to $55,000 by the union. Three weeks after his last “gift” of $25,000, Kaplan announced to the startled brotherhood that the union was broke. Officials of unions are also usually allowed from $30 to $50 a month for the upkeep of luxurious automobiles presented to them by the union. In one New Jersey local the president had $300 worth of dental work done at the union's expense. Yet the labor racketeer has not been satisfied with his seemingly adequate stipend and has found other lucrative sources of income.
Incomes of the large unions run into huge sums. The boss has complete charge of this money and rarely accounts for expenditures. Members of local 3 of the International Brotherhood of Electrical Engineers brought a suit against the local officials to account for $7,500,000 of union funds, much of which they claimed had been used illegitimately. This is the same union which contrary to all union principles entered into an agreement with the New York Edison Co. not to organize its employees. Jacob S. Solomon, secretary of the organizing committee of local 3, admitted that he had secretly destroyed the vouchers and records of the expenditures of close to $1,500,000 between 1926 and 1930 because he feared that "spies” would gain access to the records, and Wilson, the president, agreed that considerably more than $1,000,000 had been spent without authorization. In 1926 before H. H. Broach, who has just resigned as head of the International, took office, the union spent $2,130 in legal fees; between 1927 and 1930, Broach spent $532,000 for legal services. The case for an accounting was suddenly settled last fall. According to a letter sent to Police Commissioner Mulrooney by a committee of the union, “the accounting case was settled by guaranteeing the men who brought the action 1 year's work in addition to a cash settlement.
Sam Kaplan made no accounting during his entire term of office. He was held in contempt of court by Judge May for failure to produce the books of the union. In a case now pending trial, members of suspended local 52 of the iron workers charge that John M. Schilling, financial secretary of the local for 24 years, never gave an accounting during all this time. They found the auditor's report he presented this year unsatisfactory and allege that Schilling refuses to account for $100,000 of the union's money:
To enrich the treasury of local 306 further, Kaplan introduced the permit system by which nonunion men are allowed to work on union jobs. This was done without the consent or knowledge of the members of the union. Under his rule there were 600 permit men who paid initiation fees ranging from $500 to $1,000 and 20 percent of their salaries to the union. Permit men receive much lower wages than the regular card holders, and have absolutely no voice in union councils. They are not recognized as union members, but they are liable for certain levies and assessments. Harry Sherman, the new president, is now making an effort to reform this system which is still maintained in local 306.
Tom Maloy employed the same system in local 110 of the motion-picture operators of Chicago. Nonunion men claimed that they could obtain jobs by paying Maloy or his representative, Pete Kitcheos, sums ranging from $450 to $1,000. However, they soon found themselves out of work again if they did not continue to pay tribute to Maloy after the initial installment. If the permit man lost his job, he had to give Maloy another huge “gift” to obtain work. In addition to this, the permit men gave 10 percent of all their earnings to local 110. Permit men occupy jobs which ordinarily would go to the regular members of the union. Many unemployed card men are willing to take a permit man's job, but they cannot get them. In Chicago men who had been members of the union since 1910 were without work while permit men held good jobs. Pleas to the local officials were unavailing.
Another racket practiced by union officials is to send a man out on a job paying, say, $100 a week. The employers pay this money not to the worker, but to an official of the local, who gives the worker a salary of $50 a week and pockets the other $50. The employee pays 10 percent of his $50 into the union treasury. Even workers who receive starvation wages must pay part of their pittance to the union for protection. Thirteen complainants, seven of whom were women, brought charges against the Teamsters and Chauffeurs Union in Hudson County, N.J. The affidavits alleged that the women, who were cleaners and pressers, were forced to pay from $1 to $2 as weekly fees to what was termed a cleaners' branch of the union for the privilege of working unmolested. Some of the women's salaries amounted in all to only $5 or $6 a week.
Employers also contribute their share to the labor czar's revenue. Kaplan, Brandle, and Fay, in addition to being representative of the workers, were also big business men. Sam Kaplan was head of a nonunion company, which manufactured projection machines. Brandle, fourth vice president of the International Union of Iron Workers, was president of the Labor National Bank of Jersey City and an officer of the Branleygran Co., dealers in insurance and bonds. The Branleygran Co., which was the second largest holding company in the State, wrote bonds for construction work. Joseph Fay, head of local 825 of the Union of Operating Engineers, was part owner of the International Excavating Co., which rented out 10 dump trucks and several steam shovels to building contractors. The wise employer patronized these firms. John Springer, of the Springer-Cocalis theater circuit, stated that: "although the prices of Sam Kaplan's company were higher than the prices of his competitors, we thought it a wise policy to pay much higher prices to Sam Kaplan's company and insure freedom from labor troubles in our theaters. Our records further show that when we gave all of our business to Sam Kaplan's company, no attempts to unionize our theaters were made, but that when we ceased to patronize Sam Kaplan's company, the attempts of local 306 to unionize our theaters became aggressive and were marked by violence."
An amusing story is told of how one of the trucks from Sam Kaplan's company drove up to instal equipment in the Ward Theater in the Bronx when that theater was being picketed by Kaplan's own union. Union theaters which patronized Kaplan's firm were allowed to employ one card man at $85 a week and four permit men at $45 to $50 a week. Others had to use five regular men at $85 a week.
“Gifts” to the union boss usually prevent all labor difficulties. Patrick J. Commerford, vice president of the Building Trades Council and delegate at large of the International Union of Operating Engineers, was on the pay roll of several nonunion companies. The Carlton Hoisting Co. paid him $25 a week in 1927 and $50 a week in 1928 and 1929 to keep it free of labor trouble. The cash was kept in a safe until a sizable amount accumulated and then Commerford would call for it. The United Hoisting Co. paid Commerford $75 a week for the same services. These gifts were for protection against Commerford's own union.
Strike breaking was another of Commerford's specialties. He received $7,000 from the W. R. Gahagan Co. to call off a strike, and $5,000 from R. J. Murphy Co. to break up a strike at Jones Beach. Theodore Brandle and officials of other New Jersey locals of the Iron Workers split a $10,000 “gift” from the Iron League of New Jersey. Brandle was also director general of the Iron League, an employers' organization. He said he was going to serve both sides.
The czar, who exercises absolute control of the distribution of jobs, preserves his power by giving the best ones to his supporters. Members of the opposition soon find themselves unemployed. Local 11 of the Newark Iron Workers used the "card-index" system for the purpose of discrimination. Under the "cardindex" system a worker may receive a job only when the card bearing his name appears at the head of the file. When he receives work his card is moved to the end of the file. A job given to a favorite might last for several months, while a member not in the good graces of the officials of the union might receive work only lasting a day and yet have to wait his turn before receiving another job. Chancellor Berry said that workers in this union were oppressed almost to the point of serfdom. Sam Kaplan appointed the business agents of local 306, and the business agents distributed the jobs. No member of local 3 of the Electrical Workers was permitted to accept employment without permission of the local officials. Other bosses use the same methods.
If a member persists in his attacks on the administration, he is soon suspended or expelled from the union and loses his means of livelihood. Many union constitutions are so written that the czar can always find a pretext for suspending or expelling a member. A member can be fined hundreds of dollars, suspended, or expelled for “improper conduct", "committing a nuisance”, “using his own automobile in a manner considered unfair to other members or against the best interests of the local”, “creating or attempting to create dissatisfaction or dissension", "disturbing the harmony of meetings”, “using profane language in the property of the local union", "revealing the business of the union to outsiders”, and “attending any meetings or conferences having for their purpose the criticism of any officers or representatives of the district council.” The iron workers must also take the following oath: “I will at all times be respectful in word and action to every woman, and be considerate to the widow and orphan, the weak and the defenseless." The constitutions are often drawn up by handpicked committees selected by the czar.
Joseph Blek was suspended from local 3 of the electrical workers on the charge of working with nonunion men. The men were actually members of his own union, and Judge Martin stated in his opinion that "the alleged charges were merely a pretext to discipline the plaintiff.” Fourteen members of the same union who attended a meeting for the restoration of union rights of local 3” were suspended for a year and fined $300 each. Alexander Polin was beaten up and expelled from Kaplan's union for asking for an accounting.
Although Judge Peter Schmuck declared that unions which expelled their members for taking their grievances to court were not only "ridiculous" but were "assuming •governmental authority which would not be tolerated by the Government”, yet most unions still provide for the immediate expulsion of members who go to court before exhausting their resources within the union. Union trials (and often the conviction is had without any) are notorious farces. The highest authority to which a member can appeal is the international convention which is held every 2, 3, or 4 years, provided it is not postponed to save expenses. The convicted member may wait as long as 8 years before being heard, and then there is little likelihood of the original decision being reversed. In the carpenters' union during the last 8 years 102 appeals were taken to the executive board from the rulings of the international president. In every case the decision of the international head was confirmed.
If the opposition does succeed in wresting the power from the czar, the international often steps in and suspends the local; and another union is established in the same territory with the ousted officials in power. The constitution of the Iron Workers contains the following clause:
“The general president shall, whenever in his judgment subordinate bodies or the members thereof are working against the best interest of the international association, have the power to order said body to disband or cease such practices under penalty of revocation of charter. He may personally, or by deputy, take possession of, for examination, all books, papers, and financial accounts of all subordinate bodies."
The president of the Electrical Workers has the same power.
Patrick J. Commerford was appointed supervisor of local 125 of the International Union of Operating Engineers by President Possehl to “eliminate graft and corruption.” The same system was installed in 18 other locals. Commerford appointed all the officers and there were no elections. When the union rebelled and removed Commerford, local 125 was suspended and a new local 130 was formed with Commerford as its supervisor. He informed contractors that they' must deal with the new local. A similar procedure has apparently been followed in the case of local 52 of the Iron Workers. When John M. Schilling, a vice president of the International, was not reelected financial secretary, local 52 was suspended and a new local 447 was formed with Schilling as financial secretary.
Gangsters and strong-arm men are employed by the racketeers to intimidate the members of the union. Kaplan had four bodyguards whose salaries were paid out of the union treasury. Men who became too obstreperous at meetings were silenced by these thugs. One of them, Teddy Greenberg, was sentenced to 6 months for assaulting Cecil Woods, Jr., a member of the opposition party of local 306, but Kaplan saw to it that the union continued to pay Greenberg his salary of $125 a week during his term of imprisonment. Henry Ğodel, an active critic of the officers of local 3 of the Electrical Workers, was recently murdered. Sternburg, Young, Clohessy, Martin, Terry, and Malone were all severely beaten up, and Sorenson and Dooner were shot in the union offices. A member of the union who testified in court against Van Arsdale, who was accused of shooting Sorenson, had acid thrown in his face and lost the sight of his right eye. Dissenters in local 110 of the Motion Picture Operators met similar fates.
A fight between the Touhys gangsters and the Humphreys gangsters to gain control of the teamsters union in Chicago provided even more spectacular displays of violence. Eighty-three-year-old Steve Summer, an officer of the union for more than 30 years, had bullet-proof glass windows in his home, steel mesh on the windows, and a porthole for a rifle in the door to protect him against invaders. One mob drove up to the union headquarters with a battery of machine guns, automatic shotguns, and revolvers and announced "we are taking over the place for the day.” They were driven out a few days later in a counter revolution Sass and Goldberg, officers of the union, were abducted, and the home of Arthur Metzger, a business agent, was bombed when he refused "a fabulous salary to retire and revoke the union's membership in the American Federation of Labor." There were seven bombings in 48 hours at the height of the guerrilla warfare.
Union treasuries are milked by the czars not only to defend themselves, but the gangsters. Greenberg was defended on numerous occasions by high-priced union lawyers. Each member of local 306 was assessed $21 to provide a $25,000 fee for Max Steur who defended Sam Kaplan against an indictment based on charges made by members of the union. Kaplan also spent $3,000 a week for an intensive advertising campaign to maintain the reputation of local 306." The administration of local 3 of the Electrical Workers requested $1,500 for the legal defense of Constantino who was accused of shooting Sorenson and Dooner. When 8 member moved to use the $1,500 for the medical expenses of Sorenson, he was ruled out of order.
International officers have done little to remedy the situation. Instead, they often give aid and comfort to unscrupulous officials by laying all dissension within the unions to “radicals” and “labor spies.” At the convention in 1932, P. J. Morrin, International President of the Iron Workers, said that
"In the Eastern section of the country, especially the Newark (Brandle) district, our organization has been cursed with a lot of radical activities which have kept that organization embroiled in internal conflict for the past 2 years. They have kept up constant wrangling and dissension within the ranks of their local union accompanied by radical bulldozing tactics seeking either to rule or ruin. I myself visited our Newark local union and pointed out to them the dangers of permitting their internal dissension to continue, and the dangers of permitting these dissensionists to lurk within their ranks. I urged them to forget their differences and disregard the wild, radical propaganda made to them by radical members within their own ranks."