FOURTH ANNUAL REPORT OF THE NATIONAL

LABOR RELATIONS BOARD

I. INTRODUCTION

A. WORK OF THE BOARD

The Board is pleased to report that the statistics of its work for the fiscal year ended June 30, 1939, show, as they did in the Third Annual Report, a very high percentage of cases disposed of and closed during the year; although, compared with the preceding fiscal year, there has been a decrease in the percentage of such cases and the total number of cases pending at this date is somewhat higher than at the end of the preceding fiscal year. Detailed statistical analysis of the work of the Board during the fiscal year will be found in Chapters IV, V, and VI.

The Board's statistics show that during the fiscal year, the Board was able to dispose of almost 84 percent of the cases closed without formal hearing. Of the cases closed, nearly half were closed by adjustment. Thus, slightly less than half of the charges of unfair labor practices disposed of during the year were closed by substantial compliance with the act and voluntarily accepted by all parties; and over 40 percent of the representation cases disposed of were closed by informal determination of the question concerning representation, with a large number of elections held by consent of all the parties, making hearings unnecessary and resulting in collective bargaining. The Board is also gratified to report, as it did in its Third Annual Report, that in the numerous elections participated in by thousands of workers, the secrecy of its ballots was not questioned, and its election machinery was frequently praised by employers and unions alike for its competence and efficiency.

Although the number of formal hearings held by the Board during the fiscal year has decreased, the decisions issued by the Board have increased markedly, with the number of decisions in unfair labor practice cases issued during the fiscal year slightly more than double that number for the preceding fiscal year. The statistics for the fiscal year also show an increase in decisions by the Board dismissing unfair labor practice cases, and a great increase in compliance with Board decisions and orders in unfair labor practice cases.

B. RELATION OF BOARD ACTIVITIES TO INDUSTRIAL PEACE

The Third Annual Report emphasized the increased number of cases appearing before the Board after the Supreme Court decisions validating the act, and it also indicated that increasing resort was had to Board facilities, instead of the strike, where controversies arose over the issue of labor organization. This development con

tinued at an accelerated pace during the past year as Board machinery came to be used on a greater scale than before.1

From 1937 to 1938, the total number of strikes in American industry decreased by 49 percent, involving a decline of 64 percent in number of workers. At the same time the number of organization strikes decreased by 56 percent, a drop of 81 percent in terms of workers involved in strike activity. In contrast, the number of Board cases during this period decreased by only 15 percent, a drop of 48 percent in terms of the number of workers involved. Thus, the decline in strike activity was far greater than that in Board activity.

Further comparison of Board cases and strike activity reinforces this evidence of a tendency for workers to resort to Board procedures rather than the strike. During 1936 the number of strikes had exceeded the number of Board cases by 33 percent. In 1937, the figures were reversed, and Board cases exceeded strikes by 121 percent; the trend continued in 1938 when the number of Board cases became 267 percent greater than the number of strikes. Broken down by months, the figures are equally convincing. For every month during 1937 (after May), Board cases exceeded strikes by percentages varying from 100 percent to 385 percent; during 1938 the percentages ranged from 168 to 355; and during the first six months of 1939, from 175 to 208.

Similar findings result from a comparison in terms of number of workers. In 1936 the number involved in strike activity exceeded that involved in Board cases by 32 percent. The figures were reversed in 1937, when the number of workers in Board cases exceeded that involved in strikes by 29 percent. This relationship has continued for every month since May 1937, with the exception of September 1938 when the number of workers involved in strikes was 9 percent greater than that involved in Board cases. During the period, June 1937 to July 1939, the monthly figures measuring the percentages by which the number of workers in Board cases exceeded the number involved in strikes ranged from 7 percent to 615 percent. The percentages ranged from 33 percent to 615 percent during the given period in 1937, from 7 percent to 274 percent during 1938 (with exception noted above), and from 15 percent to 209 percent for the 6-month period ending June 30, 1939.2

The effect of Board activity is seen even more clearly in a comparison restricted to organization strikes (which center around the

1 For tables and charts of data used in the discussion immediately following, see appendix A, tables I and II, charts A. B, C, D.

Data on the bituminous coal stoppage of April-May 1939 have not been included in the tables appended herein nor in the statistics comprising this section because of the peculiar nature of that stoppage. "termed variously a strike, a lock-out, a stoppage, or a suspension." (U. S. Bureau of Labor Statistics, Monthly Labor Review, August 1939. p. 390.) The Bureau of Labor Statistics refers to it as the "bituminous coal stoppage." (Cf. Ibid., September 1939.) Elsewhere it has been pointed out that the dispute concerned "no principle involved in the Wagner Labor Relations Act." (New York Times editorial, May 6, 1939.)

If data on this stoppage are included for the purposes of analysis here, the comparisons would be modified as follows: For April the number of Board cases would exceed the total number of strikes by 195 percent and the number of organization strikes by 553 percent; the number of workers involved in Board cases would be 71 percent less than the number of workers involved in all strikes, and 67 percent less than the number of workers involved in organization strikes. For May the number of Board cases would exceed the total number of strikes by 184 percent and the number of organization strikes by 460 percent; the number of workers involved in Board cases would be 2 percent less than the number of workers involved in all strikes, and 58 percent greater than the number of workers involved in organization strikes. However, the general trends noted in the above discussion

issues that are directly involved in Board cases). For 1936 Board cases exceeded organization strikes by 34 percent; in 1937 the difference increased to 291 percent, and by 1938 it reached 652 percent. Similar figures are disclosed by a comparison in terms of number of workers. The number involved in Board proceedings in 1936 exceeded that involved in strikes by 25 percent; in 1937 the percentage increased to 122 percent; and in 1938, 520 percent.

Further break-down of the data reveals that for every month beginning with April 1937 and ending with June 1939, the number of Board cases exceeded the number of organization strikes by percentages varying from 77 percent to 925 percent. During the period April-December 1937, monthly percentages ranged from 77 to 766; during 1938, from 393 to 925; and during January-June 1939, from 416 percent to 601 percent.

A similar comparison of monthly data in terms of number of workers reveals further the extent to which workers have turned to the Board instead of resorting to strikes. Since validation of the act in April 1937, the percentage by which the number of workers in Board cases has exceeded the number of workers in organization strikes has fluctuated from 37 percent to 1,756 percent. Variations during specific periods are as follows: a minimum of 37 percent and a maximum of 1,011 percent during April-December 1937, a range from 188 percent to 1,756 percent during the 12 months of 1938, and percentages ranging from 108 to 841 for the first 6 months of 1939.

Analyzing and surveying the effect of its operations upon industrial relations, the Board has classified strike data for 1937 and 1938, the first 2 full years of effective administration, into industries in which it has taken jurisdiction and industries in which it has taken partial or no jurisdiction. During this period the total number of strikes in the first group declined by 48 percent, contrasted with 29 percent in the latter group. In terms of number of workers, the decreases were 66 percent (for industries in which the Board has taken jurisdiction) and 52 percent (for industries in which it has taken partial or no jurisdiction). Decreases in terms of man-days of idleness were 71 percent and 51 percent in the order given above. Thus, in every significant measure there has been a greater decline in strike activity for industries in which the Board has taken jurisdiction than for other industries.

The relation between strike activity and the state of the business cycle during the past year is further evidence of the beneficial effects of Board activity. Generally in the past, strike statistics have followed the patterns of the business cycle, diminishing with a decline in business activity and increasing during periods of recovery. Thus, in 1936-37 an increase in the index of industrial production was accompanied by an increase in man-days of idleness, until the summer of 1937, when strike activity diminished with the recession which began during that period. In the latter part of 1938 the customary

It is evident, of course, that many factors beyond the Labor Relations Act influence the course of industrial relations, particularly strike activity, e. g., the business cycle, differences over the substantive conditions of employment (not included within the direct purview of the Board), labor disunity, continued opposition of employers to collective bargaining and related factors.

4 See Table III of appendix.

The movement does not occur with year-to-year regularity since other factors influence the trend of strike statistics.

movement was absent, and man-days of idleness did not increase at a rate comparable with the increase in industrial production.

But the accomplishments of the Board are not confined to a reduction of strife. They include a more positive effect, seen in the increase of written trade agreements which has occurred during the past few years as collective bargaining procedures have been extended and more widely accepted throughout American industry. This development signifies that during the past year * an increasing number of employers began to accept trade-unions and to adjust their management methods and policies accordingly."

66*

*

All industries and trades have shared in this extension of collective bargaining, but the development has been really spectacular in the mass-production industries, where before 1937 there were almost no agreements. Prior to 1937 there were few agreements in iron and steel; in that year more than 350 were reported. By 1938 the number had increased to 500; and three-fourths of the basic iron, steel, and tin-producing industry and varying proportions of allied metal fabricating and processing were covered by agreement. The number continues to grow. In contrast with the small number (roughly 100) of rubber workers covered by agreement in 1932, there are now more than 40,000; more than 80 percent of this coverage has been effected since the Supreme Court decisions validating the National Labor Relations Act. Other examples of recent agreements in mass production include flat glass (more than 21,000 workers), aluminum (6 plants employing 17,000 workers), automobile (more than 500 agreements in 1938), electrical equipment (more than 400 agreements covering companies like Philco, General Electric, Radio Corporation of America), and rayon yarn (American Viscose employing 20,000). These examples provide only meager illustration of a growth in written trade agreements that is unprecedented."

C. COURT REVIEW OF THE BOARD'S ORDERS AND MISCELLANEOUS LITIGATION

During the fiscal year ended June 30, 1939, the Board's litigation was concerned principally with cases involving the enforcement or review of its orders in unfair labor practice cases under the procedure provided in section 10 of the act. The flood of injunction cases which impeded the Board's work during the preceding fiscal years has entirely subsided, only one such case occurring during the fiscal year. With the expansion of the Board's activities, enforcement and review litigation increased over preceding years, a total of 44 final decisions having been rendered in such cases during the fiscal year by the various circuit courts of appeals and the Supreme Court of the United States. In addition, the fiscal year was marked by a great increase in the settlement of cases through the entry of consent decrees in the circuit courts of appeals, 147 such decrees having been entered during the year as compared with 11 listed in the Third Annual Report.

U. S. Bureau of Labor Statistics, op. cit., March 1939, p. III.

A recent study of the National Industrial Conference Board contains interesting comment on this development. Cf. National Industrial Conference Board, Management Record. July 1939, vol. 1, No. 7, A Comparison of Union Agreements, p. 101.

The Board was involved in 13 cases before the United States Supreme Court during the fiscal year. Six of these were cases in which application was made for a writ of certiorari to review a lower court decision favorable to the Board. In five of these six instances, the Supreme Court declined to review the decision. In another case, the Supreme Court declined to review a lower court decision unfavorable to the Board; and one case, in which certiorari was granted to review a decision modifying a Board order, remained on the Supreme Court docket at the close of the court term. In the six cases in which argument was held and an opinion rendered, the Board was fully sustained in two, one of which did not involve enforcement of a Board order, its order was modified in two others, and set aside in the remaining two. In these cases a number of issues of great importance to the administration of the act were ruled upon. The Board's jurisdiction over unfair labor practices occurring in a large utility system upon which instrumentalities of commerce are dependent for power was sustained in Consolidated Edison Co. v. N. L. R. B.,10 one of the most important decisions with regard to the commerce power of the Federal Government in recent years. _This case also considered the proper procedure to be followed by the Board where the order issued by the Board requires the setting aside of collective agreements with bona fide labor organizations. In the case of N. L. R. B. v. Fainblatt,11 the jurisdiction of the Board over unfair labor practices occurring in a small enterprise engaged in processing goods belonging to others, where the raw materials and products are shipped across State lines, was affirmed. In the Consolidated Edison Case and in N. L. R. B. v. Columbia Enameling & Stamping Co.,12 the nature of the evidence adequate to support fact findings of the Board upon review in the courts was considered. In substance, the Supreme Court held that the supporting evidence should be such as “a reasonable mind might accept as adequate to support a conclusion," or which "affords a substantial basis of fact from which the fact in issue" might be "reasonably inferred." In Fansteel Metallurgical Corp. v. Ñ. L. R. B.,13 the Supreme Court ruled that the Board was not empowered to order the reinstatement of strikers who seized, and through unlawful resistance to a court injunction, retained possession of the employer's plant, even though the strike was caused and prolonged by flagrant unfair labor practices of the employer.

Out of 38 decisions rendered by the circuit courts of appeals in Board cases during the fiscal year, the Board's orders were enforced in full in 12 cases; in 17 cases its orders were enforced as modified.11 In 9 of the cases the Board's orders were set aside, although in one a new hearing was ordered, in another the circuit court of appeals was subsequently reversed, and in a third its decision was modified by the Supreme Court.

The Board's orders for reinstatement with back pay of employees discriminatorily discharged have, for the most part, been enforced,

This case, Ford Motor Company v. N. L. R. B., 305 U. S. 364, is discussed below. 10 305 U. S. 197.

11 306 U. S. 601.

12 306 U. S. 292.

13 306 U. S. 240.

14 In six of these cases, only the notice provisions of the order were modified.