Labor cases: Member Emergency Boards: Presidential (under sec. 10, Railway Labor Pacific Electric Railway-conductors, motormen, switchtenders, (The other two O'MALLEY, MART J., lawyer (former judge Supreme Court of Indiana): Career: Admitted to Indiana Bar in 1915; county attorney, Huntington, Ind., 1930-32; member board of works, and city attorney, Huntington, 1939-43; judge, Supreme Court of Indiana from January 1943 to January 1949. Bar memberships: County and State. Fraternal affiliations: Elks. Clubs: Kiwanis at Huntington, Ind. Labor cases: Referee, National Railroad Adjustment Board: First Division, June 1948 (38 cases); January 1949 (46 cases); and November 1949 (68 cases), (each appointment by National Mediation Board); Third Division, May 1945 (30 cases)-(appointed by National Medi- Fourth Division, January 1946 (6 cases)—(appointed by National Arbitrator: Special Board of Adjustment No. 2 and Board of Arbitration Mr. HUGHES. Such Board said, at pages 42 and 43 of its report: Restoration of a reasonable differential between the two groups is justified. Without its restoration, peace on the rails cannot be assured. The history of railroad wage negotiations is replete with evidence of the seriousness with which the various labor organizations regard firmly established wage relationships. The carriers, likewise, have repeatedly testified, even in the instant case, as to the necessity of maintaining a balance between the groups of men represented by the various organizations which bargain separately with them. The Board there referred to the nonoperating employees-whose basic rates had recently been adjusted upward 20 percent-in relation to operating employees in yard service. Operating employees are the engine and train-service employees who work on the trains in road and yard service. Nonoperating employees are those employees who perform all the other work. It failed completely to apply the same sound reasoning to the distorted wage relationships between engine and train-service employees. Indeed, it gave but partial, and wholly inadequate application, of the quoted principles it seemed to espouse when it recommended an 18-cent instead of a 20-percent adjustment in yard rates. As a matter of fact, one of the basic distortions of which we complain has been increased and intensified by an adjustment in the pay system of engineers and firemen which was first made effective during the most stringent wage-control period of World War II. A board which had heard a dispute between the engine-service organizations and the carriers recommended, in part, adjustments in pay rates sought by those organizations. The carriers accepted the recommendations, but the Brotherhood of Locomotive Firemen and Enginemen and the Brotherhood of Locomotive Engineers rejected them as inadequate. Negotiations followed and, at length, a series of agreements resulted, agreements which granted the enginemen greater wage rate adjustments than had been recommended by the Emergency Board. Since the adjustments, in the form of greater increments of increase as the size and capacity of locomotives used increased, were regarded essentially as the correction of inequities and inequalities which had crept into the pay scheme of enginemen with the introduction of much bigger and more powerful locomotives, the ultimate approval of the National Railway Labor Panel, functioning under Executive order No. 9299, was obtained. The actual introduction of heavier and more productive locomotives, coupled with compensatingly increasing daily wage rates paid to firemen and engineers as a result of this wartime adjustment of an existing inequity, has made it possible for enginemen to receive on the average since 1944 very substantial increases in their rates of pay; and as still more multiple-unit Diesel locomotives come into service daily, still more engineers and firemen receive higher basic rates. But this pay factor is still denied to conductors and brakemen, the very conductors and brakemen who day after day work directly with the engineers and firemen who enjoy it, the very conductors and brakemen who are responsible for the longer and heavier trains made possible by the use of the heavier and more powerful locomotives which bring to the enginemen their automatic upward pay adjustments. In describing this similarity of function between train- and engineservice employees, the Emergency Board said: Train-service employees function on the same trains, as engine-service employees, obviously assist in producing the same product in the same tour of duty as enginemen, and are identified with the same mechanical processes on each trip, namely, those that run trains over the road. Put as clearly as possible, the Order of Railway Conductors considers the precedents I have mentioned as ample authority for the proposition that the road is always open for the correction of existing pay inequities between employees and groups of employees. However, the remaining portions of this statement will, I firmly believe, convince you that the procedures of the Railway Labor Act, coupled with the events which have taken place since the Emergency Board Report of June 15, 1950, have in this case and thus far wholly failed to correct the unequal treatment our members have received. The procedure provided in the Railway Labor Act to govern the creation of an Emergency Board, especially with respect to Board personnel, differs to a large degree from the procedure provided in the act to govern the creation of an arbitration board. A study of both procedures makes clear the sound reasons why reports from emergency boards cannot have the same meaning or command the same respect as awards rendered by an arbitration board. I would like to point out to the committee that the organizations made it very clear to the McDonough-Watkins-O'Malley board that their report could not be considered as an arbitration board award. In his opening statement to the Emergency Board, our counsel, Mr. C. D. O'Brien, made the following observation: In a sentence, plain if somewhat repetitious, you are neither the academic and powerless fact-finders of the Taft-Hartley Act, nor are you court or arbitration board or other tribunal possessing an effective power of final interpretation or of final disposition. The determined effort of the Carriers' Conference Committee to convert the report of the Emergency Board into an arbitration board award is an attempt to amend the Railway Labor Act without congressional action. The CHAIRMAN. Mr. Hughes, at this point I would like to interrupt for a moment. I am called before another committee; and during my absence the Senator from Alabama, Mr. Hill, will have the chair. Senator HILL (presiding). All right, Mr. Hughes. You may proceed. Mr. HUGHES. The Order of Railway Conductors and the Brotherhood of Railroad Trainmen in serving notices on the carriers for certain rules changes on March 15, 1949, did so with the confidence that the precedents established by the creation of the Board of Railroad Wages and Working Conditions on May 25, 1918, the Transportation Act of 1920, the implication in the Railway Labor Acts of 1926 and 1934, the Transportation Act of 1940, that both the carriers and the labor organizations recognized the necessity of equality of treatment to the employees, and governmental policy during World War II, would make possible a satisfactory settlement in direct negotiations. It was therefore with a keep sense of disappointment that we found it necessary to appear before an emergency board appointed by the President, and to reject the report of that board. We were also disappointed when negotiations in Washington, with the best efforts of the National Mediation Board and Dr. John Steelman did not bring about a peaceable settlement. The Railway Labor Act was enacted by Congress as written by counsel respectively for the railroad managements and the railway labor organizations. Again, the amendments of 1934 were agreed upon be representatives of both parties before they were enacted by Congress and approved by the President of the United States. When a number of labor relations statutes were enacted, our industry, by mutual agreement between management and the labor organizations, has been exempted from the terms of such legislation. These exemptions were based on the theory that in the railroad industry the same or better results could be achieved through the process of collective bargaining. The rules that are in effect today on the railroads are the product of negotiations and agreements between management and employees. To us, the Railway Labor Act means the principle of bona fide collective bargaining established as a public policy and a mandate of the people on both management and labor in this industry long before it was expounded by the Government for labor and management in other industries. In more recent years there has been some question as to the effectiveness of the act. It seemed to many that there was an apparent breakdown in the administration of the act. Certainly it seemed noticeable that in many respects we have failed to approximate the conditions which have resulted under other legislation. It is no secret to those who have followed labor relations under the Railway Labor Act that the management of the carriers has failed to apply the principles laid down by the Railroad Adjustment Board, and has even sought ways and means to eliminate the jurisdiction of this Board established by congressional action in 1934. Notices were served on the respective carriers on March 15, 1949, but it was many months before we were notified that a national conference committee had been designated by the eastern and western railroads. Senator MORSE. Just a moment, Mr. Hughes. You are skipping part of your prepared statement. This is the part that you wanted to make part of the record? Mr. HUGHES. I am omitting that from the record. Senator HILL. Without objection, the statement in full may go in the record. Senator MORSE. Just a moment, Mr. Chairman. I may object. I think the committee's time would be saved, Mr. Chairman, if we listen to whatever these witnesses want to put in the record now. I assume there is nothing in this statement that the witness does no feel is important, and I have enough experience with records to indicate that if they want to get it to me they should get it to me in the first instance. I want to hear these witnesses in full now, and I do not want to have material put into the record at some other time, when I may not have an opportunity to cross-examine the witness. I respectfully make the suggestion that we hear the full statement now. Senator HILL. Is that agreeable to the witness? Will you give your full statement now? Mr. HUGHES. I will be glad to do that. I will retrace and pick that up. Senator MORSE. The only purpose, Mr. Hughes, is that I think there is going to be a considerable amount of cross-examination in this hearing before we get through, and I do not propose to cross-examine any witnesses until I have heard all the witnesses on one side of this case. I want this material as I go along, so that I can frame my crossexamination accordingly. Mr. HUGHES. Despite this situation the Order of Railway Conductors and the Brotherhood of Railroad Trainmen sat down with the management of the carriers in 1947 and succeeded in accomplishing the first national agreement that has been made in the railroad industry without Government participation. Again in the fall of 1948 we came to an agreement with the carriers on a wage adjustment through direct negotiations, and without participation of any Government agent. Heartened by our successes in 1947 and 1948 we approached our 1949 movement with considerable hope that our organizations could accomplish the making of an agreement with the carriers on a national scale by means of direct negotiations and in accordance with the principles of true collective bargaining. The record of what followed has been so completely unsatisfactory that we are uncertain and disheartened as to whether it is possible for any labor organization in the 81733-51- 2 railroad industry to arrive at mutually satisfactory agreements by means of direct negotiations with the railroads of the United States. Notices were served on the respective carriers on March 15, 1949, but it was months before we were notified that a National Conference Committee had been designated by the eastern and western railroads. Although we requested that negotiations start as early as June, it was not until the middle of September 1949 that these conferences began. We met with the Carriers' Conference Committee for a period of 13 weeks and attempted to work out an agreement. During this entire period of 13 weeks the carriers did not make one single constructive suggestion, and it became increasingly clear to us that the railroads had no intention of bargaining in good faith with their employees represented by the ORC and BRT. This attitude of the carriers in direct negotiations finally resulted in a complete deadlock, and the carriers invoked the services of the National Mediation Board. Again our hopes were raised that perhaps with the participation of a Government agency the carriers could be induced to adopt a more cooperative attitude. During the process of mediation we cooperated wholeheartedly with the members of the National Mediation Board, and in our opinion they did their utmost to bring about a peaceful settlement of this dispute. They exhausted every means and every possible suggestion to this end. Permit me to also state that we feel that the Order of Railway Conductors and the Brotherhood of Railroad Trainmen did everything within their power to work along the lines of these suggestions toward the accomplishment of a satisfactory and peaceful solution of the dispute by means of a mediation agreement. A final statutory duty of the Mediation Board is to recommend to the parties that they submit their differences to arbitration under the terms of the Railway Labor Act. When we received the proffer of arbitration in this instance we were unable to accede to the suggestion for reasons primarily created by the carriers when they served their counterproposals upon the organizations shortly after the serving of the organizations' March 15, 1949, notices. I might add that one of the apparent purposes of the carriers' counterproposals, known as attachment A was, in my opinion to prevent the organizations from accepting the proffer of arbitration when it was made by the National Mediation Board. I now would like to offer into the record as ORC Exhibit No. 3, such attachment A. Senator HILL. That is the attachment to which you have just referred? Mr. HUGHES. That is right. Senator HILL. Without objection, that will go in the record. (The document referred to was marked "Exhibit ORC-No. 3," made a part of this record, and is as follows:) O. R. C. EXHIBIT NO. 3 ATTACHMENT A 1. Modify or eliminate existing rules, regulations, agreements, or practices, if any, however established, which are affected by or inconsistent with your proposal including, but not limited to, the following: (a) Elimination of those which conflict with the payment of pro rata rates in any calendar week for the number of hours constituting the basic workweek. |