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5. In consideration of above, this agreement to be effective until termination of Government wage stabilization (under Defense Production Act of 1950) or until October 1, 1953, whichever occurs sooner, and thereafter until changed or modified under provisions of the Railway Labor Act: Provided, however, That if, as a result of Government wage-stabilization policy, workers generally have been permitted to receive so-called annual improvement increases, the parties may meet with

on or after July 1, 1952, to discuss whether or not further wage adjustments for employees covered by this agreement are justified, in addition to increases received, provided in sections 2 and 3 hereof, and under the cost-of-living formula. At the request of either party for such a meeting

shall fix the time and place for such a meeting

and the parties may secure information from the wage-stabilization authorities or other Government agencies. If the parties are unable to agree at such conferences whether or not further wage adjustments are justified, they shall ask the President of the United States to appoint a referee who shall sit with them and consider all pertinent information, and decide promptly whether further wage increases are justified and, if so, what such increases should be, and the effective date thereof. The carrier representatives shall have 1 vote, the employee representatives shall have 1 vote, and the referee shall have 1 vote. The foregoing provisions shall not debar management and employees from mutually agreeing upon wage increases or rule changes, nor shall it debar the employees from initiating and progressing proposals for noncompensatory rules changes in accordance with the Railway Labor Act, as amended.

6. The usual protection for arbitraries, miscellaneous rates, special allowances, and existing money differentials above existing standard daily rates shall be included in the formal agreement.

7. When a carrier desires to establish or enlarge upon interdivisional, interseniority district, intradivisional, or intraseniority district freight and passenger runs in assigned or unassigned service (including extra service), on either a one-way or turn-around basis and through established crew terminals, or desires to change or modify existing rules relating to more than one class of service, switching limits, or practices concerning cabooses, the carrier shall give notice to the general chairman of such desires, whereupon the carrier and the general chairman shall endeavor to agree upon the conditions under which such service may be established or enlarged upon, or such changes or modifications may be iustituted.

If agreement is not reached either party may invoke mediation under the Railway Labor Act, as amended. If no agreement is reached in mediation, these issues shall be referred to a commission constituted and authorized as follows:

The commission shall be composed of four railroad presidents, chosen by the carriers, and the chief executives of the B. of L. E., the B. of I. F. & E., the 0. R. C., and the B. of R. T. The commission will be empowered to review the previous handling of these issues and to make recommendations concerning their settlement, but it shall have no authority to make new rules nor to modify existing rules except by unanimous consent of all members of the commission. In the event consideration by the commission fails to result in settlement of any of these disputed issues, either party shall be free to handle the matter under the remaining procedures provided for and permitted in the Railway Labor Act, as amended.

On matters in dispute which do not affect all of the organizations, the commission shall consist of the chief executive or chief executives of the affected organizations and an equal number of railroad presidents, chosen by the carriers.

The commission provided for in this section 7 shall be constituted by the parties 1 year from the date of this agreemen

If agreement is not reached in mediation the parties to any such disputed issue may agree to arbitrate such disputed issue, but failure so to agree shall not prevent recourse by mutual agreement to arbitration following reference to the commission.

S. A rule relating to reporting for duty will be negotiated as a part of this settlement, unless withdrawn or deferred by the carriers.

Senator MORSE. Proceed, Mr. Shields.

Mr. SHIELDS. While these propositions, and propositions which had been given the Board members by the other three organizations, were under discussion between the organizations and the Board there were brief meetings between us and the carriers on February 3 and 4, at the Board's offices. We were advised that they still took the position that no settlement was possible except one which constitutes merely a completion of the December 21 memorandum.

Meantime, on February 8, 1951, the Department of the Army issued its General Order No. 2, directed against employees who were then laying off work, and instituting interim wage adjustments effective October 1, 1950 of 121/2 cents per hour in yard service and 5 cents per hour in road service. The order gave evidence of the Army's desire that the parties should settle their differences within a reasonable time and definitely indicated that the Army did not conceive of the December 21 memorandum as in any way binding upon the parties or constituting such a settlement.

Following the Army's order there were several further meetings with the Board members, but we were not seeing the carrier representatives at all. Consequently, on February 12 the four chief executives sent the following telegram to Chairman Scott, of the Board:

WASHINGTON, D, O., February 12, 1951. J. THAD SCOTT, Jr., Chairman, National Mediation Board,

Washington, D. O.: We arrived in Washington, D. C., January 17 with our negotiating committees. To date we have met the carriers on two occasions, on February 3 and 4. Inasmuch as the National Mediation Board is still attempting to settle this 23 months' old dispute, we insist, in the interest of the public, the Government, and the men we represent, also in compliance with General Order No. 2 issued by the Army, that immediate steps be taken to arrange a joint meeting of the carriers and the employee representatives.

J. P. SHIELDS,
Grand Chief Engineer, Brotherhood of Locomotive Engineers.

D. B. ROBERTSON,
President, Brotherhood of Locomotive Firemen and Enginemen.

R. O. HUGHES, President, Order of Railway Conductors.

W. P. KENNEDY,

President, Brotherhood of Railroad Trainmen. In passing, Mr. Chairman, I want to say that the telegram was not intended in any way to be a reflection upon the efforts of the National Mediation Board to effect a settlement of this long-drawn-out dispute, but, on the contrary, rather to be a record of the indicated desire on the part of the interested employees' representatives to effect a settlement at the earliest possible date, particularly in compliance with the express desire of Government as indicated in General Order No. 2.

Copies of that telegram were directed to the chairman of this committee and to Karl R. Bendetsen, Assistant Secretary of the Army. In response, Chairman Scott sent the following telegram:

WASHINGTON, D. C., February 12, 1951. J. P. SHIELDS, Grand Chief Engineer, Brotherhood of Locomotives Engineers,

Washington, D. C.: Reurtel this date: The Board must decide for itself when in the course of its mediatory efforts joint conferences would be advisable or likely to produce favorable results. As you are aware, the Board has conducted constant mediation conferences with the parties on practically a round-the-clock basis since January 19.

The Board is at somewhat of a loss to understand your reasons for sending the telegram, inasmuch as you had been advised on Saturday, February

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10, Sunday, February 11, and again this morning that the Board intended to set up further joint conferences starting today at the tentative hour of 3 p. m. Joint: Shields, Robertson, Hughes, Kennedy, Bendetsen, Murray.

NATIONAL MEDIATION BOARD, By JOHN THAD SCOTT, Jr.,

Chairman. When the meeting convened on the afternoon of February 12 the carriers presented each organization with a complete written proposal for settlement. These proposals were lengthy and complicated but will be supplied for your committee's record, if desired." They may be adequately summarized by the simple and short statement that the carriers' written proposals of February 12, 1951, merely reduced to writing in full the carriers' understanding of a settlement based strictly upon the rejected memorandum of December 21.

Senator MORSE. Going back to the wire you received from Mr. Scott for a moment, set forth on page 43, Mr. Shields

Mr. SHIELDS. Yes, sir.

Senator MORSE. What was your reaction, yours and your colleagues, in regard to that wire?

Mr. SHIELDS. As I recall it, our reaction was that the Board seemed to feel that our telegram had rather put them on the defensive and the purpose of this telegram was to indicate for the record that they were doing everything they could to effect a settlement and that they would arrange for direct conferences between us and the carriers at such a time as they thought something could be accomplished.

Senator MORSE. Mr. Scott says in his wire that he is, somewhat at a loss to understand your reasons for sending the telegram inasmuch as he had been advised on Saturday, February 10; Sunday, February 11, and again this morning that the Board intended to set up further joint conferences. Would you like to make a statement for the record at this point of what your reasons were so that this telegram may be answered in the record!

Mr. SHIELDS. I don't know that I could expand further than I have already stated, Mr. Chairman, that we just wanted it as a matter of record that we were interested in pressing for an early settlement of these disputes and to call to the attention of the Board that we had not met the carriers except on the date stipulated in our wire and to urge that the Board redouble its efforts arranging for conferences with the carriers if that were practical and were thought to hold out any hope of effecting an early settlement.

Senator MORSE. Is it not true that, on February 12, when you sent the wire to the Mediation Board, you were being subjected to a considerable amount of criticism in editorial columns and newspaper reports because the case had not been settled ?

Mr. SHIELDS. That is true, and additionally by reason of the terms of the geenral order and the court experience of one of the chief executives involved in this dispute, we were somewhat fearful that some untoward action on the part of the employees of some one or all of the groups might bring down further wrath of the Government or the Army upon us and we wanted it shown that we were doing everything that we possibly could to effect a settlement, and that was in conformity with the admonition contained in the general order.

Senator MORSE. By this time court action, contempt proceedings, were being taken against one brotherhood, was it not ?

Mr. SHIELDS. That is correct, sir.

Senator MORSE. That court action was resulting in a considerable amount of newspaper comment, was it not?

Mr. SHIELDS. That is right, sir.

Senator MORSE. At the time you sent your telegram of February 12, the White House still had jurisdiction of this case, did it not?

Mr. SHIELDS. It did.

Senator MORSE. The record is clear, is it not, that the Mediation Board was charged with the responsibility, apparently, by Mr. Steelman to proceed to handle this case; is that not true?

Mr. SHIELDS. It is, sir.

Senator MORSE. You sent your telegram on February 12, to notify the Mediation Board that you were ready to do business? Mr. SHIELDS. That is right.

Senator MORSE. Is there anything surprising about that?

Mr. SHIELDS. It didn't occur to us that there was.

Senator MORSE. Then it is a rather common practice, is it not, in the negotiation phases of labor disputes at the White House level, to keep the record straight as to what your intent is at all times?

Mr. SHIELDS. That is correct; and that was our purpose in sending the telegram that has just been under discussion.

Senator MORSE. The Mediation Board had completely failed up to this time to successfully mediate this dispute after the great many months of mediation, had it not?

Mr. SHIELDS. That is true, sir.

Senator MORSE. You feel, therefore, do you, that it was perfectly proper for you, on February 12, to notify the Mediation Board that you were still ready and willing to consider specific proposals?

Mr. SHIELDS. We thought at that time and still think, Mr. Chairman, that it was not only necessary but was absolutely essential that we make such a record.

Senator MORSE. And you did.

Mr. SHIELDS. That is right.

Senator MORSE. Were you a little surprised at the surprise shown by the Mediation Board upon the receipt of your telegram?

Mr. SHIELDS. Yes; we were.

Senator MORSE. Counsel has a question.

Mr. MURDOCK. Mr. Shields, inasmuch as you have undertaken to summarize the proposal of the carriers, it seems to me that it would be useful if you would provide a copy of that proposal.

Mr. SHIELDS. I will arrange to do that for you, sir. We will arrange to get copies for you.

Senator MORSE. It will be understood that the copy of the carriers' proposals submitted on February 12, 1951, at the meeting of the National Mediation Board, will be inserted in the record at this point.

Mr. MURDOCK. May we designate it as "BLE Exhibit No. 4." Senator MORSE. For purposes of identification the carriers' proposals submitted in writing at the Mediation Board meeting on February 12, 1951, will be designated "BLE Exhibit No. 4."

(BLE Exhibit 4 was made a part of the record and is on file with the subcommittee. This exhibit is identical with carriers' exhibit No. 11.)

Mr. SHIELDS. Meetings have been conducted nearly every day since February 12 under the auspices of the Board, and on several occasions

we have met members of the carriers' committees in direct discussions. On February 13 the four organizations reduced their basic current requests to the simplest and most general terms in an effort to produce specific and fruitful discussions.

With your permission, I will not read them into the record because they have already been presented, I think, in Mr. Robertson's testimony.

Senator MORSE. I think it will help clarify the record while reading if the proposals were inserted at this point, and therefore, unless there are objections, we will mark for purposes of identification as "BLE exhibit No. 5the proposal submitted on February 13 by the four organizations to the National Mediation Board.

Mr. SHIELDS. Thank you, sir.
(BLE exhibit No. 5 follows:)

FEBRUARY 13, 1951.

GENERAL BASIS FOR SETTLEMENT OF WAGE-RULES DISPUTE

(Submitted by the BLE, BLF&E, ORC, and BRT) In settlement we propose

1. Place our rules proposals and those of the carriers in moratorium in view of the national emergency ;

2. Make the 40-hour week immediately available to yardmen and hostlers ; and

3. Put into effect immediately wage increases for all employees represented in these conferences comparable to those already granted in steel and other industries to employees of similar skill and experience.

Mr. SHIELDS. It is fair to state that since February 13 discussions have turned almost entirely upon the carriers' insistence upon writing a settlement of their four rules propositions satisfactory to themselves. It is also fair to state that, while we have discussed substantial upward adjustment of the money features of the December 21 memorandum with the Mediation Board, we have as yet no indication from the carriers themselves that there is any more money available, and this regardless of what concessions they might obtain from us in respect to their proposals.

At this point I would like to offer as BLE exhibits 6, 7, and 8 three sheets upon which appear the carrier version of these four rules that are now an impediment to a final settlement of this controversy.

Senator MORSE. We will mark for purposes of identification as “BLE exhibit 6" a three-page memorandum submitted by the witness, the first page of which is headed “Article 4, ‘Interdivisional runs'”; the second page, “Article 5, 'More than one class of railroad service'"; and the third page, "Article 7, ‘Yard switching limits.'” We will insert those three pages as a single exhibit identified as “Exhibit No. 6."

(BLE exhibit No. 6 follows:)

BLE EXHIBIT No. 6

ARTICLE 4-INTERDIVISIONAL RUNS

Where a carrier desires to establish interdivisional, interseniority district, intradivisional, or intraseniority district freight and passenger runs in assigned or unassigned service (including extra service), on either a one-way or turna round basis and through established crew terminals, the carriers shall give notice to the general chairman of its desire to establish such runs, whereupon

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