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and protests against the employment of Panamanian citizens on the same basis as citizens of the United States, has constituted a large percentage of the protests received. Under construction conditions, when the demand for mechanics was in excess of the number which could be obtained from the States, the comparative number of protests along these lines was small. Now, however, with industrial conditions in the United States in a most unsatisfactory condition, with a comparatively small number of positions now available, and with the prospect that the number will materially decrease in the near future, this matter has assumed important proportions. Inconsistencies, growing out of past practice and different methods of handling men in the various divisions, and perfectly legitimate when they occurred, have given excuses for protests which would not otherwise exist, but which can not, in the present state of development of the work, be avoided.

The issue of new appointments, effective April 1, 1914, to all employees on the gold roll on that date has resulted that under the present leave regulations all such employees had to begin their annual leave (if taken alone) in February or March or (if taken with cumulative leave) between February I and May 31, unless the condition of work required postponing cumulative leave for the good of the service. With the large percentage of gold men employed in this division, the absence of employees on leave hampered the work very greatly. It was considered that every reasonable effort should be made to grant annual leave to such employees as desired to take it alone, since otherwise it would be forfeited. On annual leave alone, employees were absent as follows during the months of February and March for periods in excess of six days:

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On cumulative leave alone, or in conjunction with annual leave, and on unexpired annual leave begun prior to April 1, employees were absent as follows:

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In addition to the leave actually granted effective prior to June 1, the leave of about 50 employees was postponed on authority from your office for the good of the service.

During the month of March, which was the critical month, 287 employees were absent at some time for a period of six days or more and, when it is considered that the entire gold roll of the division was about 835 employees, it may readily be seen how difficult was the problem of carrying out the work efficiently. This problem was rendered still more difficult of solution by the attempt made to com

ply with requests of other departments and divisions for temporary assignments to take the place of their employees on leave and by the fact that conditions which could not be foreseen required the performance of an extra large amount of work on Panama Railroad and dredging_division equipment and on equipment released to the Alaskan Engineering Commission.

There is a general tendency, when choice of date is possible, for employees intending to visit the States, to ask for leave effective about May 1 or September 1. This avoids cold weather in the States. with the danger of colds, etc., incident to great change of temperature, also the expense for heavy clothes, while at the same time permitting sufficient change of climate to be beneficial to the health. Under conditions as they existed this year, no advantage could be taken of the fall season except when the head of the division was unable to spare the services of the employee for several months and leave, therefore, had to be postponed for the good of the service. Few leaves required to be postponed for that length of time; hence the benefits to health for employees who might have chosen to go in the fall, rather than early in February or late in May, was reduced to the minimum.

With a gold force as large as that employed by the mechanical division, four months (i. e., two months prior to and two months after the expiration of the service year) do not, under conditions now existing and likely to exist for at least two or three years yet to come, give sufficient latitude for granting leave to all employees who are entitled to it without seriously reducing the efficiency of the organization. It would seem desirable to consider some modifications permitting more latitude, and it is suggested that the modification might well consist in allowing cumulative leave for any service year to be taken at any time subsequent to the expiration of 10 months' service during the year and by allowing it to be combined with any unused annual leave for the current year or the previous year not in excess of 24 days. No change should be made in the present regulations relative to accumulation of cumulative leave, nor in the provision that leave may be taken only when the employee's services can be spared.

As soon as resignations, discharges, and other casualties have operated to distribute the dates on which the service year of employees begin fairly uniformly throughout the year, the bad results, chargeable to the fact that practically all service years now date from April 1, will be avoided; but there will still remain the disadvantage that many employees must take their leave at seasons when, on account of extreme heat or extreme cold in the States, the beneficial effects to be obtained from leave will be almost nullified.

Another thing that has given ground for complaint and for requests for postponement of leave is the fact that unless such employees take leave in the hottest part of the summer those who have children must take them out of school or else leave them on the Isthmus. Quite a number of requests for postponement on this ground were received from employees, but your office decided that it was not a reason which would justify postponement under the regulations. It seems to me that this is a condition which should receive serious consideration and which might be met by a change in the opening date of the school year so as to allow children to be taken to the

States during either the spring or the fall without having to miss school. My contact with the boys of the Zone, incident to the employment of apprentices, indicates that the children of employees do not receive proper benefit from the excellent school system. This is no doubt largely due to carelessness on the part of parents, and this carelessness may reasonably be expected to be less under operating conditions than was the case under construction conditions; but at best, even if there is room for choice (which does not exist now), parents will be too prone to take their leave at the best season for comfort in the States, regardless of any interference with the schooling of their children which it involves, and the fitting of children for the best accomplishments in after life will thereby be interfered with.

On March 11, 1915, you approved a set of regulations governing the employment of apprentices in the Panama Canal shops, as a result of which the number of apprentices has been increased and a definite system of instruction has been established, both in the shops and in studies connected with the trades chosen. The system as adopted promises to be most beneficial and to give to the sons of employees an opportunity to fit themselves for after life in a manner not hitherto possible. The establishment of industrial training in the Zone schools is also beneficial along the same lines.

Tables as follows, showing various phases of the operations of the mechanical division for the fiscal year 1915, are attached; plate 126 shows the organization in effect July 1, 1915:

Table 1. Abstract of expenditures of the entire division, showing distribution of charges and overtime work performed.

2. Abstract of expenditures of the mechanical division shops only, showing distribution of charges and overtime performed.

3. Abstract of expenditures for Balboa shops only, showing distribution of charges and overtime performed.

4. Abstract of expenditures for Cristobal Dry Dock shops only, showing distribution of charges and overtime performed.

5. Abstract of expenditures for Paraiso shops only, showing distribution of charges and overtime performed.

6. Abstract of expenditures for the Cristobal roundhouse only, showing distribution of charges and overtime performed.

7. Abstract of expenditures for fuel-oil plants, Balboa and Mount Hope, showing the cost of operation, quantities of oil handled, and the unit cost.

8. Abstract of expenditures for the operation of the foundry, Balboa shops.

9. Number of repairs to locomotives.

10. Number of repairs to equipment other than locomotives and cars.

11. Number of shop and field repairs made to different classes of cars.
12. Amount of equipment hostled, and the cost.

13. Expenditures and output of the oxy-acetylene plant, Balboa shops.

Respectfully submitted.

D. C. NUTTING, Superintendent Mechanical Division.

Maj. Gen. GEO. W. GOETHALS, United States Army,

Governor, The Panama Canal,

Balboa Heights, Canal Zone.

TABLE NO. 1.-Abstract of expenditures of the mechanical division, showing distribution of charges and overtime work performed.

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1 Includes value of Panama Canal fuel oil handled by fuel-oil plants. For amounts, see Table No. 7.

TABLE NO. 2.-Abstract of expenditures of the mechanical division shops only, showing distribution of charges and overtime work performed.

1,000, 369.08
83,364.09
42,083.69

3,799, 287.63
316, 607.30
427,998.63

131, 475. 54

6.27

10,956. 29

6.27

19,313.00

8.43

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TABLE NO. 2.-Abstract of expenditures of the mechanical division shops only, showing distribution of charges and overtime work performed Continued.

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TABLE NO. 3.—Abstract of expenditures, mechanical division, for Balboa shops only, showing distribution of charges and overtime work performed.

69, 027.50
58,649.46
75, 511.65
89, 686. 22

260,594.35
241, 964. 22
241, 607.09

9, 925.32

6.33

9,905.41

6.50

11, 482.00

6.55

242, 255. 12

74, 724. 17
96, 813.36

282, 114.54
279,577.36

10, 606.00
14,974.37
17,874. 19

6.28

8. 56

9.93

3,478, 253. 08

131, 475.54

6.28

289, 854.42

10, 956. 30

6.28

427,998. 63

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