ministrator who has already proven that that agency cannot clarify these situations. We think the answer to that is to have Congress itself sit down and do a very thorough job, as it did in portal to portal, and as I think it has already done today on this overtime on overtime, and try to arrive at definitions and standards which the businessman can count upon, rather than to compound confusion by extending the authority of the Administrator in a field in which he has already demonstrated that he cannot give us any stability or any assurance as to what our obligations are. Mr. LESINSKI. Will the gentleman yield right there? Is not the reason for that that the agency is separate from the Labor Department, and there may be some confusion there because it is not operated under one department? Mr. ROTH. No, I think not, because I do not think that labor has had concurrent jurisdiction. Mr. LESINSKI. I mean the Labor Department. Mr. ROTH. I do not think the Labor Department has had concurrent jurisdiction. I do not think the Labor Department could do a better job of the administrative rulings than the Administrator himself. We have had long experience with that, and we have just had compounded confusion. As a matter of fact, the Administrator himself testified that many of these technical violations are technical and arise from the inability of the employer to know what his obligations are or his duties are. You have heard the testimony today on the overtime problem. That is only one phase of this. But that is a fine example of a case where not only the employer but the unions and the employers working together found that the Administrator reversed their interpretation and upset their collective bargaining. Personally, I believe in collective bargaining and I think that most employers in this country do. But I think that we should settle these things at the collective bargaining table and not through administrative rulings which are very often contrary to the intent and best interests of the parties themselves. Mr. BREHM. May I interrupt there? Then does the gentleman feel that a contract arrived at by collective bargaining should remain in effect for the term of the agreement, and should not be interrupted or separated from the scope of the full sanctity of contract? Mr. ROTH. I think I will say this a little further, as to what the attitude is with respect to the unions. Mr. BREHM. I am a stickler for the sanctity of contracts. I think they should be abided by from the beginning, until that contract expires. Mr. ROTH. We think there are some clarifications here which should be made and could be made if this committee were to sit down as it has, and I say on occasion, do a very thorough job of investigation and clarifying these rules by legislative enactment. In that connection, we feel that the subject of dealing with the exemption by agriculture, and particularly the processing of agricultural products, is one of very great concern to this country. We believe that the impact not only of the minimum wage but the various rulings of the Administrator which are changing with the changing personnel continually-I spent 6 years in Washington, and we all know how we suffer from changing personnel. We just cannot avoid Furthermore, I might mention the fact that this actually increases the coverage. It is not limited to 8 percent of our employees, because the coverage is increased, according to the testimony of our Adminis trator, by a potential 5,000,000 workers. I think there is a very great danger that unless this matter is gone into very carefully in its impact on what I have called the submarginal indstry, which can least afford to pay the increased wages, we may find that it will work to the disad vantage of the great majority of the people that we desire to help. In this connection it should be borne in mind that this bill does not provide any shock absorber. It makes a jump from 40 to 15 cents, and does not follow the act of 1938 in which we did carefully cushion against the effect of this sudden rise by providing for an escalator increase over a period of years. should take very careful account of the possibility of making any I think your committe increase which you may arbitrarily fix by statute conform to that principle. We have had experience with it. crases; We have absorbed these inhave worked our way out. But to do it in 1 year as against doing it in 7 years is quite a different picture. we Now, I would strongly urge that if your committee, after careful study-and I think it takes more study than you can give this serious question at the moment-finds that you are going to raise it to 75 cents, or any other figure, you should give careful consideration to providing escalator increases to distribute the shock to business and allow the adjustments to take place, and allow us to increase production if we can, although, frankly, I am not too optimistic about that, although they think that that is the answer to the ability to pay these wages, even in these submarginal groups. Our position generally on a minimum wage is briefly this: We think this is a matter which is fraught with such dire possibilities from the standpoint of its effect on inflation and the fact that it may defeat its purpose, that it should be gone into very carefully by this appointed to make a more careful study than you have had a chance We think that a congressional committee should be to do before we plunge in here, into this sort of increase in the mini committee. mum wage. So far as industry committees are concerned, it seems to us that this is a device which is designed to raise as rapidly as possible, not to 75 cents, but to $1 by industry committees. The objection that I see to the industry committee is that it would generalize probably, or most assuredly, on a national basis, and that it injects another element of instability into our business picture. If the businessman is subject. or if industry is subject, to constant restriction through industry-wide committees, it is pretty hard to tell where your costs are going to be or to develop the ability to pay, which necessarily must exist, if these industries are going to survive. So far as the application of the act goes, we feel very strongly, of and practices involved in the minimum-wage law. That has been the rules the moment in a guessing contract with the Wage and Hour Adminis demonstrated by the fact that we are in many industries engaged at trator as to what our obligations under the law are. We do not believe that the way to clarify that is to give additional authority to an ad ministrator who has already proven that that agency cannot clarify hese situations. We think the answer to that is to have Congress itself sit down and do a very thorough job, as it did in portal to portal, and as I think it has already done today on this overtime on overtime, and try to arrive at definitions and standards which the businessman can count upon, rather than to compound confusion by extending the authority of the Administrator in a field in which he has already demonstrated that he cannot give us any stability or any assurance as to what our obligations are. Mr. LESINSKI. Will the gentleman yield right there? Is not the reason for that that the agency is separate from the Labor Department, and there may be some confusion there because it is not operated under one department? Mr. ROTH. No, I think not, because I do not think that labor has had concurrent jurisdiction. Mr. LESINSKI. I mean the Labor Department. Mr. ROTH. I do not think the Labor Department has had concurrent jurisdiction. I do not think the Labor Department could do a better job of the administrative rulings than the Administrator himself. We have had long experience with that, and we have just had compounded confusion. As a matter of fact, the Administrator himself testified that many of these technical violations are technical and arise from the inability of the employer to know what his obligations are or his duties are. You have heard the testimony today on the overtime problem. That is only one phase of this. But that is a fine example of a case where not only the employer but the unions and the employers working together found that the Administrator reversed their interpretation and upset their collective bargaining. Personally, I believe in collective bargaining and I think that most employers in this country do. But I think that we should settle these things at the collective bargaining table and not through administrative rulings which are very often contrary to the intent and best interests of the parties themselves. Mr. BREHM. May I interrupt there? Then does the gentleman feel that a contract arrived at by collective bargaining should remain in effect for the term of the agreement, and should not be interrupted or separated from the scope of the full sanctity of contract? Mr. ROTH. I think I will say this a little further, as to what the attitude is with respect to the unions. Mr. BREHM. I am a stickler for the sanctity of contracts. I think they should be abided by from the beginning, until that contract expires. Mr. ROTH. We think there are some clarifications here which should be made and could be made if this committee were to sit down as it has, and I say on occasion, do a very thorough job of investigation and clarifying these rules by legislative enactment. In that connection, we feel that the subject of dealing with the exemption by agriculture, and particularly the processing of agricultural products, is one of very great concern to this country. We believe that the impact not only of the minimum wage but the various rulings of the Administrator which are changing with the changing personnel continually-I spent 6 years in Washington, and we all know how we suffer from changing personnel. We just cannot avoid it in our American system. But the more authority you give to the changing officers in the administration of our Government, the greater confusion you get. I think we have a fine example of that in the agriculture field, where we have had varying interpretations of what is processing within the definition of the exemption of agriculture and what is not. And it is pretty hard to say what it should be. We personally think that the agricultural exemption should be left as it is, except that it should provide that all employees in and of affected establishments are not exempt, rather than to provide that certain employees in an establishment are and certain others are not. I think you will appreciate the difficulty of administering that sort of situation, where you have to appraise these. Mr. LESINSKI. The gentleman is talking about the area of production? Mr. ROTH. That is right. I just cite that as an example. Mr. LESINSKI. This is the first time we have done it. Nobody could give us an answer as to what "area of production" meant. Mr. ROTH. It indicates how difficult it is for the Administrator to do these things. I think the job is for Congress to sit down and go into these things most thoroughly, and make sure they give us a yardstick that we can follow so that we will know what we are doing. Mr. LESINSKI. That is what we are attempting to do. Mr. ROTH. We do not think you have reached it yet. And I do not think, frankly, Mr. Chairman, that you can reach it in the time available at your disposal. I do not think I can make an adequate presentation. I left San Francisco last night and I arrived in Washington without an opportunity to see your bill. I will apologize for my lack of preparation. But I do not see how the witnesses who appear here can give you what you need to make these determinations and make these rulings and these definitions in the time that is available. I am not complaining that you let me go on for an hour. I am grateful for that. But I do speak of the difficulties under which we work. As a matter of fact, what we are really doing under this bill is to extend to the Administrator, as I see it, some of the legislative functions of this Congress. Personally, I cannot subscribe to that delegation. I do not believe that we want to build up a bureaucracy here of changing personnel, as I have said, if we are going to be concerned in making a record as to how to change the law. Let me point out one thing here in that connection: The Administrator asks for authority here to institute and enforce actions to recover wages. As the reason for that authority, which really puts the Administrator in the position of being a grandiose collection agency in our Government, he suggests that there are $6,500,000 in claims which employers have refused to pay. Well, let us evaluate that for a minute. That is $6,500,000 out of a total pay roll of $122,000,000,000. Scaled down, it means that less than five ten-thousandths of 1 percent of the employers in this country are refusing to pay their claims. Yet he would ask the authority to go out and enforce the things, extend his jurisdiction, so that the private initiative will undoubtedly be influenced of every employee, whether or not he filed a suit, because he can institute these proceedings with the consent of the employee. I think I know how that sort of bureaucracy will work. I am not criticizing the present Administrator at all, but we do know that these agencies are out to make records to justify their stand. I think they will be under a natural compulsion to go out and make just as big a record of collections as they possibly can, to justify their stand. Now, the only reason that has been assigned is that here are $6,500,000, which is an infinitesimal amount of it, and, secondly, that it is unfair to employers who do pay these claims to have some employers who do not. Well, I have not heard any employers complaining of that discrimination. That premise really begs the question, because it may be that this residue of $6,500,000 represents claims that should be revised and that quite justifiably should be paid. There is no distinction here. All he says is that there are $6,500,000. As far as he knows they may be doubtful claims; they may be invalid claims. But in any event, that reason given just does not justify the building up of additional authority here and an additional staff to go out and prosecute employers. I make no apology for the record of employers and the payment of wages. I think it would be pretty hard to match that record here anywhere in civil life. I think the record is an excellent one, and I do not see any reason for alarm to justify the extension of authority. Now, on the overtime-on overtime problem-I think your committee has gone into that very thoroughly. We do endorse what Mr. Maloney has stated to your committee as to the seriousness of that problem and the need for urgent treatment, but we would like to point out that that relates to many industries other than water front. It would be a mistake to assume that a critical nature of this problem involved only the water front or the urgency for relief. The fact is that the building industry, and a great many industries-tobacco, men's clothing, nonferrous metals, autos, canning and preserving, textiles, shipbuilding, trucking, and particularly as I said before, the construction industry-all have this problem involved in the matter of their interpretation of their contracts. And not only the maritime contracts, but many contracts in these other industries are to be negotiated this spring, and it is highly essential that we get a definition of this overtime on overtime problem which will clear that up. It is particularly important that that be cleared up, because unions are in an increasing number pressing so-called fringe items, which are really not fringe items at all in the over-all costs of production, but I refer to welfare plans, bonuses, sick benefits, and all these items, and they are pressing them in these negotiations. If those various benfits which employers have granted in many instances voluntarily in the past, and in many other instances have agreed upon through collective bargaining, are to be obtained from employers, they have to know what their obligations are in overtime. And I can say to you quite frankly out of a large experience in collective bargaining that this overtime provision will certainly act as a deterrent to good collective bargaining, and it will act as a deterrent to the conclusion of good collective bargaining during this coming year to a very large extent. I think you would do a real service in |