company will lead to riots and disorders in the State of Pennsylvania unless some means be found to make the company change its present policy toward its employees.

THOMAS H. FLYNN.

Subscribed and sworn to before me this 5th day of December, 1912. [SEAL.] EVA A. MILNE, Notary Public.

My commission expires February 21, 1915. Commissioner AISHTON. What strike is that referred to in that affidavit; is that what is known as the Pierce strike?

Mr. PERHAM. No, sir; this was a shop-organization strike that started in Pittsburgh or vicinity in the spring of 1911.

Commissioner AISHTON. That was prior to the Pierce strike?

Mr. PERHAM. Yes, sir.

We filed 50 letters from employees relating to the telegraphers' organization, and the discrimination against the members of the regular organization-the Order of Railroad Telegraphers--and the acts in favor of the company organization.

(For said letters see Perham Exhibit No. 9.)

I might say that these 50 letters are selected from about 10,000 in my files at St. Louis.

Again, on the same subject are 25 selected reports from organizers on the same subject.

(For said reports see Perham Exhibit No. 10.)

We have here a copy of circulars for the government of employees of the telegraph department of the Pennsylvania Railroad, effective October 1, 1914. Commissioner LENNON. Promulgated by whom?

Mr. PERHAM. By the company. This schedule of rules, when sent out, was accompanied by letters. I will read three of the letters in relation to it [reads]:

THE PENNSYLVANIA RAILROAD Co., EASTERN PENNSYLVANIA DIVISION, Harrisburg, Pa., November 9, 1914.

Mr. C. S. MELCHER, R. J.:

I inclose herewith a copy of regulations for the government of employees of the telegraph department, effective October 1, 1914, which were agreed upon after several conferences between the company and a committee of operators representing the Order of Railroad Telegraphers, Dispatchers, Agents, and Signalmen.

Jos. BROWN, Division Operator.

I might state that a railroad company very seldom advertises a railroad organization in that manner. [Reads:]

PHILADELPHIA, October 27, 1914.

All concerned, telegraphic department, Philadelphia Terminal Division: We send herewith copy of Regulations for the Government of Employees of the Telegraph Department, effective October 1, 1914.

It is to be understood that these regulations were proposed by the committee of operators who are members of the Order of Railroad Telegraphers, Dispatchers, Agents, and Signalmen, and have been agreed to by the company after various conferences with that committee.

All operators, Maryland Division:

H. LOGAN, Division Operator. WILMINGTON, DEL., November 5, 1914.

We are sending you, under separate cover, a copy of Regulations for the Government of Employees of the Telegraph Department, effective October 1, 1914. These regulations were proposed by the committee of operators who are members of the Order of Railroad Telegraphers, Dispatchers, Agents, and Signalmen, and have been agreed to by the company after various conferences with that committee.

C. J. RUDULPH, Division Operator.

(Witness here submitted printed pamphlet entitled "The Pennsylvania Railroad Co. Regulation for the Government of Employees of the Telegraph Department.")

Commissioner LENNON. Are there any particular sections to which you refer, or do you refer to all of the rules generally?

Mr. PERHAM. This is an amended code of rules, and the point of this exhibit is that when the rules are sent out by the company they state that it is done at the request of a labor organization, but it is the company's own organization and not the regular organization.

A VOICE. Mr. Chairman, on a question of privilege; I am president of the O. R. T. & F., and I desire to file with this commission a list of members.

Chairman WALSH. Please see the secretary, Mr. L. K. Brown, 940 Southern Building, in this city.

A VOICE. I have a letter saying that I was to be invited to attend this meeting, but it was overlooked. I am here, and I will state, if you will allow me Chairman WALSH (interrupting.) We will not allow you now.

A VOICE. Please excuse me.

Chairman WALSH. We will excuse you, but your matter will be taken up in the regular way.

Mr. PERHAM. I wish to file another production. It is a copy of the by-laws of the Mutual Benefit Association of Pennsylvania Railroad Employees (Inc.). This seems to be the latest labor organization fostered by the company. It has many things to commend it in the way of organization work. I refer to a mutual benefit association proposition contained therein. It also arranges for committees to adjust grievances, and so forth. Among its peculiarities are, "Officers must have been 15 years in the service of the company." That is stated on page 41 of this document. "They must have the indorsement of the executive officers of their various departments." That is stated at page 41 of this document. "They must be at least 35 years of age." And that is stated on page 41. The arrangement for local committees of adjustment is mentioned on page 53 of the document.

(Document referred to was submitted in printed form.)

Commissioner AISHTON. This Mutual Benefit Association that you have just referred to-this organization has nothing to do with the O. R. T. D. & S., or something like that?

Mr. PERHAM. No connection that I know of.

Commissioner AISHTON. So that this age limit, and all that sort of thing, does not apply to the other organizations?

Mr. PERHAM. No, sir. This is the latest-the last organization that is supposed to be formed by the Pennsylvania Railroad Co. in behalf of its employees. Commissioner AISHTON. That has a sick benefit?

Mr. PERHAM. There is a death fund arranged for, but no sick benefit that I can discover.

Chairman WALSH. In its general form, is it a labor organization? Does it provide for the presentation of grievances, and does it have the characteristics of a labor organization, such as those organizations usually have? Mr. PERHAM. Yes.

Commissioner AISHTON. What class of grievances does it provide for?

Mr. PERHAM. They are not specified, and that question is only mentioned in a very indefinite way, but it is there.

Commissioner AISHTON. And it has no connection with the other order of telegraphers that you have talked about?

Mr. PERHAM. No. It is a corporation, and it is different from the others in that-that it is incorporated.

With reference to charge No. 6, respecting the company's refusal to mediate or arbitrate labor disputes: During the years 1908 and 1909 the telegraphers, through their regularly elected committee, attempted to get recognition and a revised wage scale, but the officials declined to do business with the regular committee, and, as a last resort, mediation under the so-called Erdman Act was requested by the employees. The committee consulted with the mediators as to the necessity or advisability of taking a strike vote, and the consensus of opinion was that under the circumstances such a course was not necessary. Upon invitation from the mediators, officials of the company and the committee representing the employees went to Washington, D. C., during the month of February, 1909. The attorneys for the company made the plea that it was necessary, under the law, that trouble should be threatened or pending before the mediators could act. As no strike vote had been taken-and, furthermore, the committee being unwilling that such a vote should be taken-the negotiation was dropped for the time being.

During the months of July, August, and September, 1912, the members of the Order of Railroad Telegraphers endeavored again to establish contractual relations with the company. The officials by various devices, such as referring the committee from one official to the other under the pretense that the same were absent on vacation or out of town or on inspection trips, avoided meeting the committee of their employees, and they eventually returned all documents to the committee and declined to have any business with them. The company then prepared for a strike by placing extra employees in the towers and offices, most of whom were totally ignorant of the requirements of the job.

The employees' committee sought mediation under the terms of the Federal law, but the company refused to either mediate or arbitrate the questions at issue.

To substantiate these statements we desire to file for the use of the commission a copy of the Erdman Act and a copy of the Newlands Act, showing the difference between the two statutes.

Chairman WALSH. At this point we will stand adjourned until 2 o'clock this afternoon. Please resume the stand at that time, Mr. Perham,

(Whereupon the commission took a recess until 2 o'clock in the afternoon.)

AFTER RECESS-2 P. M.

Chairman WALSH. Mr. Perham, will you please resume the stand? You were finishing something when you were interrupted, and if you will, please, I would like you to finish that; and then, if there is no objection, I would then like to have you retire, so as to put in one other witness, with whom arrangements have been made to testify at 2 o'clock.

Mr. PERMAM. That is quite agreeable.

Chairman WALSH. Very good. Then we will connect it up.

Mr. PERHAM. At the point where we stopped I was on my statement with reference to charge No. 6, and we were about to file exhibits to substantiate the statements made.

Chairman WALSH. If you can finish up on No. 6 I wish you would do so.

Mr. PERHAM. We now file a copy of the Erdman Arbitration Act; a copy of the Newlands Act, which superseded the Erdman Act; a copy of our circular letter dated October 10, 1912, referring to certain questions mediated or arbitrated; the correspondence in relation to our requests for mediation and the replies thereto; correspondence showing that the employees desired to go out on strike, about which their organization for prudential reasons withheld its approval; newspaper clippings indicating how the arrogant attitude of the officials of the company was generally regarded. We have no need to read any of the exhibits in the case, and will file them with your permission. And that concludes our matters in relation to charge No. 6.

(All the foregoing matter was submitted in printed form except strike letters, for which see Perham Exhibit No. 11. The newspaper clippings are as follows: "Bars Knapp and Neill in wage adjustments," Washington Star, Sept. 5. 1912; "Telegraphers ignored," Pittsburgh Dispatch, Sept. 15, 1912; "Pennsylvania declines mediation of dispute with its telegraph operators," Philadelphia Record, Sept. 15, 1912; "Refuses any mediation with its telegraphers," New York Sun, Sept. 15, 1912; "P. R. R. opens recruiting office for telegraphers," Philadelphia Public Ledger, Sept. 26, 1912.)

Chairman WALSH. Then, if you will just retire for the present, we will recall you when we get through with the next witness.

Mr. PERHAM. Thank you.

Chairman WALSH. NOW, Mr. Lincoln.

(Mr. Robert T. Lincoln was here called as a witness. His testimony will be found under the heading "Pullman Employees.")

TESTIMONY OF MR. H. B. PERHAM-Continued.

Chairman WALSH. May I ask you to take up at the point you left off, and just proceed. I am sorry to have detained you in this manner, but arrangements were made many days ago.

Mr. PERHAM. I expect to be through in a very few minutes.

Chairman WALSH. We must have perfect order in the rear of the house, please.

Mr. PERHAM. With reference to charge No. 7, the voluntary relief department of the P. R. R. is an insurance department of employees with accident, sick

ness, death, and pensioning benefits. While it is known as a voluntary association, yet in the last few years membership has practically become compulsory. The objectionable features of this relief department is that an employee loses all equity in it when he leaves the service of the company, either voluntary or through discharge. This is, of course, a powerful weapon in the company's hands, for men who have contributed to this insurance fund for 10 or 20 years are very careful to do nothing which will endanger their position with the company and thereby cause them to lose all that they have paid in.

During the year 1914, 41,412

Chairman WALSH. HOW many?

Mr. PERHAM. Forty-one thousand four hundred and twelve men lost their equity in this insurance. The injustice of forcing men to take insurance which can be terminated at the pleasure of the issuing company without any refund being made is too patent to require comment.

Should an employee sue the company, there is a clause in his insurance contract which provides that he automatically forfeits his rights. In spite of the thousands who are forced to give up their savings of years, we know of no case in which a successful suit has been brought against the company to force them to refund money wrongfully retained. When an employee is discharged he has to surrender his relief contract before he will be paid the money due for his labor. The voluntary relief department is in reality employers' liability insurance in which the employee pays the premium.

The twenty-ninth annual report of the company, which is dated December 31, 1913, shows a membership of 134,189. It shows that there were 33,097 accessions to membership, and that 41,412 members left the service of the company. It is not stated what proportion of these men left voluntarily and what proportion were discharged. On the assumption that these men had been members for five years and were members of the second-class relief, which requires a yearly premium of $18, then these 41,412 men would have paid into the company treasury $3,707,080, in which fund they lost all equity.

Chairman WALSH. Has there not been a court ruling on that proposition that they had to refund the premium in cases of discharge?

Mr. PERHAM. Not to our knowledge, we have not been able to discover that. Chairman WALSH. My attention was called to the alleged fact that the Supreme Court of the District of Columbia had such a case under consideration. Mr. PERHAM. It may be the fact and we are not cognizant of it. Now, in relation to this matter

Chairman WALSH. Are you aware of any case in which that question was ever tested out as a legal proposition?

Mr. PERHAM. I myself collected a bill of that character from the railroad company without a suit, just on presentation of the facts.

I want to state to make it more clear that this relief to the sick benefit and superannuation fund, both of which are incapable of separation under existing arrangements. There seems to be no complaint in regard to the sick-benefit feature, the complaint being practically upon the superannuation end of it. Now, we desire to file copies of the annual reports of the Pennsylvania Railroad's Voluntary Relief Department for the years ending December 31, 1909, 1910, 1913, and 1914.

(Witness submitted in printed form the Twenty-fourth, Twenty-fifth, Twentyeighth, and Twenty-ninth Annual Reports of the Pennsylvania Voluntary Relief Department.)

Also copies of the regulations governing the Pennsylvania Railroad's Voluntary Relief Department. I wish to call special attention to the part on page 24, which reads (this refers to applications for membership in the relief department): "I also agree that any undue or fraudulent statement made by me to the medical examiner, or any concealment of facts in this application, or resignation from the service of the said company, or my being relieved from employment and pay therein at the pleasure of the company or its proper officers shall forfeit my membership in the aforesaid relief fund and all benefits, rights, or equities arising therefrom, excepting that my leaving the service shall not (in the absence of any of the other foregoing causes of forfeiture) deprive me of any benefits to the payment of which I shall have previously become entitled by reason of accident or sickness occurring while in the service."

(Printed pamphlet, entitled " Regulations Governing the Pennsylvania Railroad Voluntary Relief Department," submitted.)

I point that out to illustrate that the employees give up all their rights by such an agreement.

Now, as an example of the superannuation allowance, I gather from this law that an employee who has been a member, say for 30 years-10 years in first class, 10 years in second, and 10 years in third class, it figures out 10 multiplied by 12 multiplied by 1 is $1.20; 10 multiplied by 12 multiplied by 2 is $2.40; 10 multiplied by 12 multiplied by 3 is $3.60. The monthly allowance would then be $7.20, and that is not guaranteed. The pension allowance, assuming $600 average salary for the first 10 years, then 1 per cent of $600 is $6. Six dollars multiplied by 30 years of service amounts to $180. One hundred and eighty dollars per year divides at $15 per month. The total drawn by employees is $15 and $10.50 from the voluntary relief department makes the total of $22.20 per month. [Reading :]

"The investments of the department are passed on by the advisory committee, whose action, however, is subject to the approval of the directors of the P. R. R. This company, however, is the guarantor of the funds." Employees are divided into five classes according to their earnings.

The annuity is not guaranteed. Any surplus from the relief funds is turned over to this superannuation fund at the end of the three-year periods. If there is not enough to pay this rate, then all payments of annuities are scaled down proportionately.

If the employee leaves the service, whether voluntarily or through arbitrary dismissal, he loses all equity in the relief fund. Should he sue the company, he forfeits his equity.

The company pays the cost of maintaining the department and makes good any deficiency in the relief-fund liability account.

Payments to this relief fund are paid monthly in advance, being deducted from the employee's monthly earnings. This payment takes precedence over any other claim against the earnings of an employee.

In the last few years membership in this association is believed to have become compulsory. In any event the company will not employ any man who does not first take and pass the medical examination for this association.

This association works decidedly to the advantage of the P. R. R. It is really employers' liability insurance, except that it is so arranged that the employees pay the premium. Then, too, fear of losing all of the money which they have paid into it keeps the employees steadily at work and is a very effective club in the company's hands in the time of trouble.

I file a large list of letters and statements showing that the department is a misnomer and that the membership is not voluntary.

(See Perham Exhibit No. 12. A clipping from the Evening Journal, Washington, Del., March 4, 1915, entitled “B. & O. is illegal," was also submitted.) On our part, the objection is because the men do not seem to live long enough to draw any pension or superannuation fund.

Commissioner LENNON. Before leaving that subject, have you a statement as to the accumulation of funds in this department by the company?

Mr. PERHAM. It is shown in the annual report, exhibits I furnished for four years. There are some more interesting matters in this exhibit, as to the condition of telegraphers and signal men, and the reason why. Their names do not appear upon the roll of honor as old employees, and the reasons why are shown in the exhibit.

Chairman WALSH. What are the main reasons?

Mr. PERHAM. The conditions of service are so intense that the men do not live to that age, and insanity among signalmen is one of the most remarkable features of it. A number of the men have broken down from the conditions under which they work; the constant watchfulness in the operation of trains and the movements of signals controlling their movement is of such a strenuous nature that they break down quite frequently.