During the past year, the Administrator and his staff have conducted more intensive studies of hired farm labor and the way in which the law could be adapted to include workers on large-scale commercial farms. As a result of this pioneering work, the Administrator has renewed his recommendation for inclusion of these employees under the law and has suggested to Congress a new but intensely practical way of handling this question.

His proposal, with which we agree, is to base the exemption not on the employment in any 1 week (as in the Thomas bill of last year) but upon the total man-days of employment in any calendar quarter of the year. The use of this criterion eliminates the objections to the formula in the Thomas bill, under which many small farms would have been covered for only a few weeks in the year.

Our proposals to include these workers under the law are given in more detail as appendix II to this testimony. In general they revise the exemptions, add certain definitions, and suggest one or two other changes that may be necessary. Under this proposal, farms with over 300 man-days of hired farm labor in any calendar quarter of the year would be covered under the minimum-wage requirement of the law. The maximum hour and overtime compensation sections would continue to exempt all agricultural workers. The effectiveness of this proposal can be indicated by the fact that it would affect only 2 percent of all farms, only 4 percent of farms hiring farm labor but approximately half of the 2,000,000 farm laborers.

It is important to point out that by taking this step of including these large-scale farms under the law, Congress will actually be helping farmers operating their own family-type farm. At the present time these farmers are at a disadvantage competing with the largescale commercial farms which are able to utilize hired labor at substandard rates of pay. It is not more than simple justice to ask that the basic national minimum wage be applied to the employees of these large-scale commercial farms.

It is not exaggeration to say that the maze of exemptions for agricultural processing operations in this law constitutes one of the most complicated, if not the most complicated, set of legal entanglements ever passed by Congress.

To give some idea of this problem we need only to look at the 1948 Annual Report of the Wage and Hour Administrator where these questions are examined in more detail. There we learn that as of September 1947 there were approximately 1,734,000 covered employees in those industries exempted under the following provisions of the law: Section 7 (b) (3), section 7 (c), and section 13 (a) (10). Some of these employees are exempt from both the minimum wage and overtime provisions; some are exempt only from the overtime provisions. Some of these employees are exempt for 52 weeks, some for only 14 weeks. Some are exempt under one provision of the law, some under two provisions, and there are even some who are exempted under three of these provisions.

The total number of exemptions adds to a figure of 1,896,000 or 162,000 more than the total number of covered employees. Because this includes duplications, the actual number of employees affected by these exemptions is 1,016,000.

The entanglements produced by this set of exemptions have lasted too long. We feel strongly that only by completely wiping out these

exemptions can the law serve its real purpose. Allowing a seasonal exemption, as the committee print does, is not sufficient.

There is a basic inequity inherent in the present coverage provisions of the Fair Labor Standards Act. It is so worded that in many cases only a portion of the employees in the particular industry is covered. In some cases, this inequity extends into a particular plant where some employees may be subject to the act while others under the same roof are exempt.

This type of situation arises in many industries where some firms are producing for interstate commerce while others are producing only for intrastate commerce. Even though these firms may be producing for the same market, only the employees producing for interstate commerce are covered by the law. In a particular plant some employees may be working on goods destined for interstate commerce, while others are not; the former group is covered under the law but the latter is exempt.

Certainly this condition should not be permitted to continue. It is basically unfair to employers producing for interstate commerce and meeting the standards set forth in the national law to be subject to the unfair competition of employers not producing for commerce and therefore not required to meet these basic national standards. The American Federation of Labor feels that if any particular industry substantially affects interstate commerce, then all of the es'ablishments in that industry should be covered by the law.

For this reason, we approve the change in the committee print whereby coverage is extended to "every employer who is engaged in any activity affecting commerce." This language, it may be noted, is found in the Wagner National Labor Relations Act and retained in the TaftHartley law, so its constitutionality cannot be questioned.

We wish to make it clear that we do not feel the Fair Labor Standards Act should be extended to local retail merchants, restaurants, or boarding houses. However, we do not feel that the exemption extended to the local retail or service establishment should be applied to the large department stores, chain stores, or hotels whose operation has become big business. There is no reason why these enterprises cannot observe the minimum labor standards set forth by Congress as a national policy.

We approve the proposed amendment in the committee print, under which the retail exemption would not apply if the enterprise included four subsidiary units or had a total annual volume of business of more than $500,000.

We also approve the following amendments in the committee print regarding the exemptions under the law:

(1) Removal of the minimum-wage exemption for seamen; this has long been recognized as a necessity.

(2) Clarification of the exemptions covering employees in the transportation industry; these inequitable exemptions have left many employees in a "no-man's land" not subject to the jurisdiction of either the Wage and Hour Administrator or the Interstate Commerce Commission.

(3) Removal of the exemption for employees engaged in the processing of fish products. We see no reason why these employees should not be treated exactly as employees in agricultural processing industries.

We approve the changes strengthening the child-labor provisions of the law. It has long been recognized that these original provisions of the law are completely outmoded and must be strengthened so that children cannot be deprived of their schooling in order to work in the factories and in the fields.

Specifically we approve the following changes in the committee print:

(1) The direct prohibition of child labor in interstate commerce and in all activities affecting commerce, rather than the mere prohibition of shipment of goods produced by child labor.

(2) The use of the phrase "outside school hours" rather than "while not legally required to attend school" with respect to the exemption concerning agriculture, in order to strengthen the enforcement of the law throughout the States.

The committee print would grant rule-making authority to the Secretary and would permit him to sue for the recovery of back wages. Both these steps are necessary and desirable. If the Fair Labor Standards Act is to be sensibly enforced, the official administering the law must have the authority to interpret its provisions so that everyone concerned will know what action, if any, the law requires him to take. Frankly, if the Administrator had possessed this authority, we might very well have avoided the difficulties we are now experiencing regarding the so-called "overtime on overtime" problem.

Giving the Administrator power to sue for back wages is absolutely essential if the law is to have any real meaning. At the present time the Administrator cannot compel payment of any back wages which might be due an employee unless the employer is a repeated and willful violator. The employee himself is permitted to sue, but because of his unfamiliarity with the law, the time and expense involved, and the risk of incurring the wrath of his employer, very few workers actually institute court action.

In addition, more and more employers have decided that they do not have to pay these back wages. They have been assisted by the Portal-to-Portal Act, which gives them several special legal defenses in these cases. In fiscal year 1946, 62 percent of the back wages due employees were collected voluntarily, but in 1947 this percentage dropped to 48 percent, and last year it was only 40 percent (p. 152. Administrator's Annual Report). For 1949 the figure will be even lower. What good is a law to prevent substandard wages if those receiving substandard wages cannot be reimbursed for the money they have lost because their employer has violated the law?

The committee print would increase the statute of limitations for court action under the law from 2 to 4 years. We opposed the 2-year statute limitation when it was considered under the Portal-to-Portal Act as too short a period in which employees could bring suit. We approve the proposed amendments to correct the injustice previously enacted.

This completes our summary of the major changes proposed in the committee print. In conclusion, we wish to emphasize certain parts of our testimony-the necessity for raising the antiquated minimum wage; the urgency of handling the so-called overtime-on-overtime question; the need for expanding coverage, especially to the new field

of commercial-type farming; and the importance of strengthening the child-labor provisions of the law. The Eighty-first Congress is facing a great opportunity; if it so wishes, it can reaffirm its faith in minimum wage and hour legislation and make that faith effective. in the way we have indicated.

APPENDIX I-REPORT OF RESOLUTIONS COMMITTEE, AMERICAN FEDERATION OF LABOR SIXTY-SEVENTH ANNUAL CONVENTION, CINCINNATI, OHIO, NOVEMBER 20, 1948.

The committee reported jointly on Resolutions Nos. 12, 18, 28, and 82, as follows: Resolution No. 12-Establish minimum wage of $1 per hour.-By Delegate C. J. Haggerty, California State Federation of Labor.

Resolution No. 18-Minimum wage.-By Delegate E. A. Carter, West Virginia State Federation of Labor.

Resolution No. 28-Minimum rage.-By Delegates Anthony Valente, Lloyd Klenert, Roy B. Groenert, Edward Hirschberger, Frank Sgambato, United Textile Workers of America.

Resolution No. 82-Minimum wage scale.-By Delegates John B. Haggerty, Robert E. Hoskin, Mary G. Morley, International Brotherhood of Bookbinders. All of these resolutions are concerned with modernizing the antiquated 40-centan-hour minimum wage now set forth in the Fair Labor Standards Act. Each of the resolutions calls for a minimum rate of $1 per hour.

The committee has reviewed all of these resolutions and is in complete agreement with the objectives expressed by them. However, the committee feels that in addition to raising the minimum wage provisions of the law, it is equally important that the coverage of the law be extended to many workers not now receiving its protection, particularly employees of large retail and department stores, agricultural workers, and seamen.

For this reason the committee has utilized the language included in these resolutions to prepare the following resolution which it proposes be adopted by the convention.

Substitute resolution

Whereas the 40-cent-an-hour minimum wage required by the Fair Labor Standards Act is completely outdated by the trends of prices, wages and the cost of living during the war and postwar periods; and

Whereas the minimum subsistence budget of WPA even in 1935 was 75 cents an hour and the minimum subsistence standard of the United States Department of Labor was set at 85 cents an hour; and

Whereas substandard firms are still paying minimum wages far below decent standards of living to millions of American workers; and

Whereas broad groups of workers are excluded from coverage under the act and are therefore denied even its inadequate protection; and

Whereas the last session of Congress deliberately allowed the bill, to raise the minimum to 75 cents an hour and to extend its coverage, to die and adjourned without action on this most vital measure; and

Whereas the spiral of inflationary prices has raised the cost of living of American workers and their families to staggering heights; Therefore be it

Resolved, That the Sixty-seventh Annual Convention of the American Federation of Labor go on record in favor of an increase in the statutory minimum wage under the Fair Labor Standards Act to $1 an hour and urge its passage by the next Congress; and be it further

Resolved, That this convention urges the extension of the coverage of the act to millions of workers who are now unjustly denied its protection, including workers in all industries affecting interstate commerce, in large scale retail trade and service establishments, in industrial agriculture, in agricultural processing, and in the maritime industry.

Assistant Committee Secretary SODERSTROM. I move adoption of the committee's recommendation.

Resolution No. 35-Inclusion of farm labor under Wage-Hour Act.--By Delegate C. J. Haggerty, California State Federation of Labor:

Whereas practically all working people, with the exception of over 3,000,000 farm laborers, are covered by wage and hour legislation, and

Whereas, many hundreds of thousands of agricultural laborers are working at wages far below the minimum wages in industry; and

Whereas, millions of agricultural workers labor through all kinds of hours, never knowing a consistent workday or workweek; and

Whereas, this condition represents a threat to organized workers in the rural areas: Therefore, be it

Resolved, That the Sixty-seventh Convention of the American Federation of Labor go on record for the elimination of this inhuman condition, which discriminates against a large body of American working people, by including them in coverage of the Wages and Hours Act; and be it further

Resolved, That the workers in the factories in the field be included under the Wages and Hours Act in the same manner as the workers in the factories in the cities.

This resolution asks that the coverage of the Fair Labor Standards Act be broadened to include agriculture laborers. This objective has for some time been part of the American Federation of Labor policy for extending the protection afforded by this statute.

The committee recommends adoption of this resolution.

On motion of Assistant Committee Secretary Soderstrom the report of the committee was adopted.

APPENDIX II-SUGGESTED CHANGES IN COMMITTEE PRINT TO INCLUDE EMPLOYEES OF LARGE-SCALE COMMERCIAL-TYPE FARMS UNDER MINIMUM-WAGE PROVISIONS OF FAIR LABOR STANDARDS ACT

1. Page 36, lines 6–7. Omit “(3) any employee employed in agriculture,” and renumber following subsections of section 13 (b).

2. Page 37, line 5. Insert new section 13 (c) as follows:

"(c) The provisions of section 6 shall not apply to any employee employed in agriculture, during any calendar year quarter, by a farm enterprise which used less than 300 man-days of hired farm labor during each of the preceding four quarters." Renumber existing section 13 (c) as 13 (d).

3. Page 37, line 20. Omit period and add the following: "or (5) any employee employed in agriculture."

4. Page 6, line 21. Add the following to section 3: "(0) Hired farm labor' includes the labor of any person employed on a farm, except the labor of the operator and that of his parents, spouse, and children. "(p) 'Farm enterprise' comprises all tracts of land, whether contiguous or not, under one management, located in a county and immediately adjacent counties, on which any of the operations enumerated in section 3 (f) is carried on.

"(q) 'Man-day' means any day on which a hired laborer performs any work." 5. In addition, it might be necessary to revise section 3 (m) in order to give the Administrator the duty of determining the reasonable cost or value of various perquiisites that would be applicable to a particular branch or group of branches of agriculture.

6. It may also be necessary to make possible the use of the week or month as a measure of work for compensating hired farm workers in addition to the hour which is applied to other employees.

Mr. McCONNELL. You heard the statement of the CIO?
Mr. MASON. Not all of it. I was in and out.

Mr. McCONNELL. They said the two labor organizations discussed this addition in the provision on line 23 in accordance with regulations issued by the Secretary of Labor under section 4 (c). It is my understanding that the AFL and the stevedores had reached an agreement a few days ago on this. However, this involves a change in what you had originally agreed upon, and there was inserted "in accordance with regulations issued by the Secretary of Labor under section 4 (c)."

Now, I understand that wording was agreed upon in a meeting, or some get together, of the CIO and the AFL on this. Is that an accurate statement?

Mr. MASON. For several months representatives of the AFL, International Longshoremen's Association, together with industry repre