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Labor Boards: The New Mechanism for Industrial Relations

by John A. Fitch

Director of Industrial Courses, New York School of Social Work

November 1934

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In the Houde case, decided August 30, 1934, by the National Labor Relations Board (successor to the Wagner Board) it was held that "the employer is obligated by the statute to negotiate in good faith with his employes' representatives; to match their proposals, if unacceptable, with counter proposals; and to make every reasonable effort to reach an agreement." A further statement to the same effect appeared in the report of the Winant Committee dealing with the textile strike: "Section 7-a . . . imposes a duty on employers to recognize any individual or organization chosen as the representative of their employes and to make every reasonable effort to reach a collective agreement with such representatives."


Labor Board

The National Labor Relations Board, made up of non-partisan representatives of the public. Left to right, Edwin S. Smith, Massachusetts labor commissioner; Lloyd Garrison, chairman,University of Wisconsin; H. A. Millis, University of Chicago

These statements of the obligations of the employer will doubtless have influence. A similar statement appeared in the Wagner industrial disputes bill which was before Congress last winter. It must necessarily remain a fact, however, that the specific steps required of an employer in any particular collective-bargaining conference have not as yet proved susceptible of effective definition. The requirement in the law and the statements of boards as to its meaning have been valuable primarily for their moral effect and their contribution to standards of conduct.

As a matter of fact the major issues that come before the boards involve coercion. They have to do mostly with attitudes and behavior preceding the collective-bargaining conference rather than with the conference itself. More than a fifth of all the cases handled by the Wagner Board involved "discriminatory discharge," most of them for joining or promoting a trade union. On the other hand, many involved compulsion with respect to joining a company union, and altogether the great majority of the cases raised the question of the freedom of the worker to organize and choose his representatives. Issues of this sort are relatively clear. However complicated a particular case may be, there can be little difference of opinion that the outstanding methods of employer-coercion with respect to organization—discharge, threat of discharge, yellow-dog contract—are definitely illegal under Section 7-a.

YET these cases, too, involve many problems that are difficult of adjustment. Immediately upon the passage of the Recovery Act, company unions began to bloom amazingly in plants where before not even that agency for employe representation had existed. The National Association of Manufacturers, not widely celebrated for its advocacy of collective bargaining, sent to all its members a model company-union plan. Arthur Young, vice-president of the US Steel Corporation, has testified that he himself devised a plan which has been adopted in 165 mills of the Corporation and its subsidiaries "as a legal vehicle of collective bargaining." A strange sort of vehicle for the Steel Corporation to be steering!

Cases involving company unions usually present the question of freedom of choice. Did the employes freely vote to accept the plan? Did they vote for representatives without the presence of the slightest shadow of employer-influence? Was coercion, however subtle, brought to bear? Some "elections" held to determine whether the employes wish to accept a company union have been held under company auspices and without opportunity for discussion. In some, company officials have counted the votes, and in many no alternative choice has been provided in the ballot, the worker being required to vote either for or against the company union. It would take some courage to write in on such a ballot the name of a labor union, especially if the election is conducted by company officials. In still other cases coming to the attention of the boards, company unions were imposed without a vote of the employes and in others representation was limited to workers in the plant, thus offering something less than full freedom of choice. In all cases coming before the boards such acts have been held to be in violation of the law.

Perhaps the most difficult requirement of the law, from the enforcement angle, appears in the first sentence of Section 7-a, "employes shall have the right to organize and bargain collectively . . ." Who are the "employes" possessing this right? Does it mean any group of employes, however small? Or does it mean all the employes, and must the organization fail of its purpose if even one employe remains outside? The latter was the contention of an employer whose actions came under the scrutiny of the National Labor Relations Board. In discussing at a meeting of his employes, called by himself, the request of some of them for recognition of their union he stated that "under the law he could not recognize the union unless it represented 100 percent of the employes in the plant, that he would be jailed if he did so."

In spite of absurdities, the question how "employes" may establish their right to bargain collectively through their chosen representatives, is a real one. What proportion of the workers should belong to an organization before it is entitled to recognition? If it is 51 percent then what is the status of the 49 percent? Do they have representation too? And if there should be further sub-groups and finally individuals who persist in their ruggedness, is the employer obliged to bargain separately with each, collectively with the groups, individually with the individuals?

This is a question that has worried the wise men in the Administration from the President down ever since it emerged, early in the career of the NRA. And it has been decided first one way and then another and then back again. Some of the authorities have remained consistently in one camp, some in another and there are some who have decided the matter both ways.

The first important recorded opinion on this subject appeared in a joint statement by General Johnson and Donald Richberg issued August 23, last year. They declared that "the right to organize and bargain collectively" which is established in the law, "can mean only one thing, which is that employes can choose anyone they desire to represent them or they can choose to represent themselves. Employers likewise can make collective bargains with organized employes, or individual agreements with those who choose to act individually." Accordingly, when in October 1933 the Administration worked out an agreement for ending the strike in the "captive mines," it was stated that "representatives chosen by a majority will be given an immediate conference, and separate conferences will be held with any representatives of a substantial minority. "


Kay Davis, University of Virginia, © 2001-2003