REPORT OF THE SECRETARY OF LABOR. To the PRESIDENT: DEPARTMENT OF LABOR, OFFICE OF THE SECRETARY, In two particulars the work of the Department of Labor during the fiscal year just closed has been especially important and successful. One has had to do with labor distribution, the other with mediation in labor disputes. The mediation work of the year has furnished further proof of the value of the act of Congress under which the department operates in behalf of industrial peace; and as to labor distribution, not only has the department made progress directly in finding employment for the unemployed, but in addition it has begun the building up, cooperatively with State and municipal employment offices, of an interrelated system of public employment exchanges on a national scale. Details of the work of labor distribution appear in the annual report of the Chief of the Division of Information, which, as part of the annual report of the Commissioner General of Immigration, is herewith transmitted and of which a summary appears farther on in my own report. The subject of mediation in labor disputes is presented now. MEDIATION IN LABOR DISPUTES. Authority and policy.-Authority for mediation work is derived from that clause of section 8 of the organic act of the department which provides that "the Secretary of Labor shall have power to act as mediator and to appoint commissioners of conciliation in labor disputes whenever in his judgment the interests of industrial peace may require it to be done." In administering this authority I have regarded it as contemplating a development of diplomatic duties. with reference to labor disputes analogous to those of the Department of State with reference to international controversies. As it is the duty of the Department of State to represent our Nation with fairness toward all other nations, so it is the duty of the Department of Labor to represent wage-earning interests with fairness toward all other industrial interests. Initial difficulties. In the beginning the mediation work of the department was hampered by inadequate financial support. Until more than half a year after the creation of the department no appropriation had been made for compensation or even for the expenses of commissioners of conciliation. The only assistance the department had was such as could be drawn in emergencies from bureaus under its jurisdiction. On October 22, 1913, however, the deficiency bill for the fiscal year ended June 30, 1913, appropriated $5,000. But this appropriation was limited to expenses. Consequently commissioners of conciliation were not employed, there being still no money to pay them. Not until April 6, 1914, was any fund provided for that purpose. The sum of $20,000 was then appropriated for the second fiscal year, July 1, 1913, to June 30, 1914. But although this appropriation provided compensation for commissioners of conciliation, less than three months remained for its use. Thus it will be seen that until the close of our second fiscal year the aggregate of appropriations for mediation and conciliation service from the time of the creation of the department, a period of 16 months, was only $25,000; that of this amount $5,000 was available only for expenses and not even for this purpose until three months of the fiscal year had expired; and that the $20,000 appropriated for all purposes was not available until only three months of that year remained. From the foregoing recital the handicap under which the department labored in the administration of its mediation functions may be sur mised. And this handicap was not the only one, for those appropriations did not allow commissioners of conciliation to serve in the District of Columbia nor provide in any other way for supervision or clerical aid at department headquarters. Progress. For the third fiscal year, being the one for which this report is made, an appropriation of $50,000 became available. The Secretary was thereby enabled not only to appoint commissioners of conciliation in his discretion, but to authorize them to serve in the District of Columbia as well as elsewhere. He was also enabled to employ an executive clerk, who, under the direction of the Chief Clerk, has clerical charge of details in connection with the mediation and conciliation work of the Secretary in labor disputes. SUMMARY OF WORK PRIOR TO THE THIRD FISCAL YEAR. In spite of the difficulties that are always unavoidable at the start in administering new Federal functions of any sort, and notwithstanding the additions to these difficulties in the present case from delayed and insufficient appropriations, from continued lack of clerical assistance for the executive clerk, and from the necessity still resting upon the Secretary of Labor to give initial attention to details that ought to be sifted through a specialized division, remarkable success has attended the mediation and conciliation work from the beginning. By June 30, 1914, the close of the second fiscal year, being only 16 months after the creation of the department, the work had already made considerable progress. My second annual report shows that for this period 33 requests for mediation in labor disputes had been received, that 31 mediations had been completed, that of those completed 26 ended in settlements of the disputes mediated, that in only 5 cases were settlements found to be impossible, and that the remaining 2 cases had gone over into the third year. A tabulation of all this work from March 4, 1913, when the department was created, to June 30, 1914, was reported in full in my second annual report at pages 44 and 45. SUMMARY OF WORK OF THE THIRD FISCAL YEAR. When the appropriation for the present fiscal year had enabled the department to begin systematic organization of the mediation work 2 cases from the preceding period were still pending. As 40 new requests for mediation have come in, there is a total of 42 cases for the present year. Out of these cases 26 amicable settlements have been effected and in only 10 cases did settlements prove to be impossible. Six cases go over unfinished into the fourth fiscal year. Details of the foregoing summary of mediation work for the present fiscal year are now submitted. RAILROAD CASES. Freight clerks of the New York, New Haven & Hartford Railroad Co. The first mediation through this department, made in the spring of 1913 by G. W. W. Hanger as commissioner of conciliation, produced an amicable settlement between the New York, New Haven & Hartford Railroad Co. and its clerks, which was reported at page 23 in my second annual report. Pursuant to this settlement, an agreement was signed June 2, 1913. Thereafter there was harmony between those interests until the present year, when a dispute arose between the freight clerks and the company over an alleged violation by the company of the agreement. Patrick Gilday and Clifton Reeves having been appointed commissioners of conciliation for this department, the clerks stated 16 grievances, upon the basis of which the commissioners conferred with the company. It furnished a written reply. As a strike ballot was being taken by the clerks' union at the time, the company refused to meet a committee 23871°-Ab. 1915-vol 2- -44 of its clerks; and although a meeting between some members of the clerks' committee and the general manager of the company was arranged there were no satisfactory results. From time to time the railroad officials offered written propositions of settlement. These were presented by the commissioners to the clerks' committee, but none proved acceptable. Finally, however, a meeting of the entire clerk's committee with the general manager of the company at the company's office, June 14, 1915, effected a settlement except as to 2 of the 16 grievances. For the settlement of these a further meeting was arranged. Shortly thereafter the clerks' committee rejected the settlement, and the company charged bad faith. The parties were then farther apart than before. Pending strike orders further conferences were held, and on June 22 a complete offer of settlement was made by the general manager. The commissioners addressed a proposal to both sides and both sides accepted. It adjusted 13 grievances in accordance with the arrangements previously made and referred 3 points for settlement to Mr. Hanger. He was chosen arbitrator on the reserved points, because he had brought about the original agreement of 1913 between the railroad and its clerks. Commissioner Reeves went over the entire case with him, and both the company and the clerks signed the terms of settlement that were thereupon prescribed. Throughout the mediation and at the conference of June 23, when final settlement was secured, the general chairmen of the organizations of engineers, conductors, trainmen, firemen, and telegraphers assisted cordially and efficiently. This settlement secured to the clerks and the railroad company a working rule similar to that which has proved satisfactory with the firemen, engineers, and other employees of the same railroad company. Besides effecting with the railroad and its freight clerks the settlement described above, the commissioners brought about, at the request of the railroad company, an arrangement with the officials and employees of the New England Steamship Co. whereby conferences are to be had between this company and its clerks over any differences that may arise between them. Car builders of Pennsylvania Lines West of Pittsburgh.-John A. Moffitt was detailed December 9, 1914, to mediate with reference to dismissals of car builders employed by these lines. His report shows that discharged members of the Brotherhood of Railway Car Men of America attributed the discharges to their trade-union affiliations. The reason alleged by the superintendent, the master mechanic, and the general car-shop foreman was retrenchment. At Commissioner Moffitt's request assurances were given that the discharged men would be offered first chances for reemployment. Subsequently the superintendent notified the commissioner that business conditions did not warrant an increase in the force at Richmond, Ind., where the rein statements were to be made, and that "the outlook for increasing the force at this point in the immediate future did not appear promising." Seaboard Air Line Railway shopmen.-Upon application of the Seaboard Air Line Railway the Secretary designated the Solicitor of the department to confer with the company and its shopmen over a controversy involving the interpretation of a clause in a railway schedule concerning the transportation of men to and from work. The conference having been held, the Solicitor stated that in his opinion the question at issue was whether or not the railroad company had violated the letter or spirit of a schedule in effect April 1, 1914, by discontinuing operation of the company's shop train at Howells. The representatives of the shop crafts claimed that the taking off of this train was not authorized under the schedule, and that in any event they should have been given due notice and accorded a hearing. The Solicitor sent to the officials of the Seaboard Air Line and all other interested parties his opinion, in which he held that the company was not authorized under the schedule to make the change without the consent of the men, and that in this view of the principal question it was unnecessary to discuss the question of notice. Shopmen of the Kansas City Terminal Railway Co.-The organized railway employees at Kansas City, Mo., having requested mediation between the Kansas City Terminal Railway Co. and its shopmen at that city, William Blackman was appointed commissioner of conciliation. From his report it appears that this company is owned by the 12 railroads entering the city, their presidents constituting its board of directors; that the company takes charge of all trains when they enter the terminal and prepares them for departure; that the employees had asked a conference with the company to establish shop rules such as the railroads using the terminal have with their shopmen; and that this request was granted. After several meetings, however, the company broke off negotiations and posted a set of rules which they stated would thereafter govern in the company's shops. Soon afterwards the company began discharging men, giving various reasons therefor, including membership in the union; and on April 30, 1915, it closed down its shops, having up to that time laid off 39 employees. Somewhat less than a month later, May 26, it reopened the shops with 50 imported men. Three more of the old men were discharged on May 28, and 38 more on June 15, making 80 in all. Commissioner Blackman had daily interviews with the president of the terminal company, endeavoring to induce him to meet the shopmen's committee with a view to preparing mutually acceptable rules and adjusting wages about on a level with those paid for similar work by the railroads using the terminal.. On the 19th of June a confer |