Of course, the right of workers to organize and the right of workers to deal collectively with their employers existed before section 7 (a) of the National Recovery Act. Nevertheless, section 7 (a) of the National Recovery Act, by a very definite and clear statement of the Congress, reestablished and reaffirmed those rights and obligations and, apparently, because of the fact that the Congress itself modified the terms of the bill when it was before the Congress, it seems quite clear that the Congress had a definite conception of the rights and duties and opportunities of wage earners to deal collectively with their employers.

The Congress having, therefore, within the past year taken affirmative action on this point, and having reaffirmed the rights of labor to organize and deal collectively with the employers, has, therefore, it seems to me, a further obligation to clarify it, if it needs clarification, that relationship, and to establish on a permanent basis a tribunal before which the facts with regard to whether or not employees have had that opportunity can be clearly established.

The Labor Board has been set up, as you know, by Executive action during the summer because of the necessity which developed, at once, of having some trustworthy authoritative tribunal before which these questions could be put and where decisions which would be recognized as valid and impartial decisions could be rendered.

So, we have had 7 months experience with this type of organization even though it did not have the powers that it might have had conferred upon it if it had been established by a duly considered act of the Congress.

It was an emergency creation and has served an extraordinarily useful purpose, and I say this as one who has not been a member of the Labor Board, but who has cooperated with the Labor Board, who has observed the activities of the Labor Board, observed the cases that have come before it, and who knows of the countless decisions that have been made which were complied with and about which there has been no question.

The public in general and perhaps you, sir, are, however, better acquainted with the few cases which have been outstanding and in which the Labor Board has not been able to bring about a complete. compliance with its decision. Those, of course are the items which concern us, and which put before you the necessity of taking some affirmative action which will define more clearly in the interests of the practice of democracy just what these obligations are and just what the duties and limits of authority of the Labor Board are.

Now, this Labor Board, in the 7 months of existence on an experimental basis, not constituted by Congress, has, nevertheless, given an authoritative interpretation of section 7 (a) of the Recovery Act. It is highly essential that there should be a definite interpretation of it. As a tribunal composed of men experienced in industry and labor questions, and as a tribunal dealing with controversies that have arisen, it has been able to build up in these 7 months, I think, the beginnings of a common law of industrial relations. This method of building law by decisions in particular cases does not seem to me to avoid the faults inherent in general laws which might be passed, or general orders which might be issued by administrative officers. It is, of course, a somewhat slower process, the process, the process of adjudication in particular cases and the evolution of principles out

of cases, but, I think, an infinitely safer process than orders in council or the administrative orders, or even acts of Congress defining such delicate and as yet undetermined things as the rights and duties of both parties in industrial relations where our thinking has not been clear and where the natural rights are not so obvious as they are in some of the other human relations with which we have dealt in the past by our statutes or by our Constitution.

The Labor Board has, moreover, by utilizing the principle so familiar to the American Commonwealth, of holding elections to determine what are the desires of individuals, has carried over into this field principles well established in American democracy, and a discipline well established in our lives, the discipline of elections and of the rule of the majority.

It has acted, as you know, as a board of elections, and has conducted innumerable elections to determine what were the desires and what was the will of the wage earners in the community, in the industry, or in the plant with regard to their representation in dealing with their employers under the collective bargaining requirements of section 7 (a), and I think that that has been an extremely wise procedure, one which grew, as we may say, quite naturally and spontaneously out of the exigencies of the situation as they came this summer, and one which can safely be continued for a most conservative and yet democratic interpretation of the needs of the community in developing the human relations of employer and employee and the human relations between groups of employers and groups of employees on a sound and substantial and just

basis.

By using its national prestige as an industrial labor board to act as arbitrator in cases voluntarily submitted to it, in which the parties in advance agreed to accept the final decision of the Board, it has produced a fundamental body of rulings, all of which it appears to me have been in the interests of law and order in industry, and in the interests of the progressive utilization of the disciplines of democracy in settling these controversies, these complexities of needs, and of interests between the two great parties of our industrial life.

Moreover, this board by regulation and by experimentation is working out the board's relationships to other agencies for the settlement of industrial disputes. The Conciliation Service of the Department of Labor, and the industrial relations board, and the cotton textile code authority, and the coal code authority, has performed a very useful service in determining just what the relationships between this board and other instruments of conciliation and arbitration might be, and this process of experimentation should, it seems to me, be allowed to continue. We have not yet reached the limits of the possibilities of cooperation or the possibilities for a great variety of devices to bring about the right relationship between employer and employee interests in a great democracy which is, after all, devoted constructively to the interests of all the people, not only the two great parties to the industrial situation.

Where this board has been inadequate it has been, I think, largely due to the lack of definite outlines of its powers, of its duties, and of its responsibilities, and due to the fact that the public in general, not knowing those definite outlines and not having the habit of acceptance

of its authority, has been unwilling to participate voluntarily and to agree voluntarily to its decisions.

As, of course, you know, and as has been pointed out to you, because of the very Executive order under which it existed and because of the lack of congressional definition as to its authority, the board has lacked power to summon witnesses and to require elections to be held and to restore to their positions men who have been discharged for organizing, to stop discrimination, and so forth.

These powers, it seems to me, clearly can be conferred by Congress and ought to be conferred by Congress if the board is to fullfil all of its very great possibilities for usefulness in our community in this transition period.

I also think that the board has been obliged by the exigencies of the situation of the summer to mix its duties and by so doing has perhaps sometimes impaired its prestige. It has been obliged to mix its judicial duties with the technique of conciliation. I feel that it is desirable to separate the duty of conciliation from the duty of a judicial board. A judicial board ought, in my opinion-and this labor board, if it is created by Congress as anticipated in the draft before you, will be primarily a judicial board-a judicial board ought to confine its duties to really serious determinations of fact and the law, but ought not to attempt to make a conciliation in which the real desire is to reach a compromise.

A judicial board ought to be building up the body of our law and the body of our understanding, and our interpretation of law which we may come to count upon as a set of precedents.

A conciliator, however, on the contrary, goes into a particular situation and attempts to find a formula upon which both parties may agree at the moment, which may or may not be in the line of permanent justice.

This board, I think, should be confined to the practice of justice in in this very unusual field, whereas the function of conciliation and mediation is an important function, but I do not think it should be performed by the same board.

The continuation of the function of conciliation in the Department of Labor closely allied with the National Labor Board is, I think, highly desirable. Moreover, I think the National Labor Board, recognizing as it will in certain cases that come before it, that as a practical matter the proper technique in the particular case is not a judicial decision but conciliation-that is, many cases are brought, as you know, almost in the spirit of litigation and will be brought before any board which is a judicial board in the spirit of litigation, and the judge sitting upon that case sees at once that what is really needed is not a judicial decision but some negotiation, some method of bringing the parties together to agree upon a compromise which will meet the particular situation-the board should have the power to establish or to authorize the creation of boards of conciliation or boards of mediation or to refer the case for conciliation or for mediation to a properly constituted authority, but I feel that it should itself not engage and so impair its prestige in actual conciliation as it has been obliged to do.

The CHAIRMAN. What is the function of conciliation that your Department now possesses?

Secretary PERKINS. The Department of Labor has a function of conciliation-it has three functions, arbitration, mediation, and conciliation, and they are rather distinct in the understanding of the Department.

Arbitration is a function which, as is well known, can be exercised only when both parties to a controversy agree to permit a third party to act as an arbitrator and agree to abide by the decision of that third party. The Department of Labor can exercise the function of arbitration when both sides agree to it.

The Department of Labor can also act as mediator, that is, it can of its own interposition and without invitation of either side, intervene in an industrial dispute with suggestions as to ways of bringing the conflicting parties into agreement, with suggestions perhaps as to the formula upon which they may agree.

It can also act in a third capacity of conciliation, by which is meant commonly a more or less negative activity in which the conciliator attempts to be the go-between between the parties who are in conflict until they, acting through him, come to some formula which it appears can be mutually agreed upon. Thereupon he retires from the scene leaving them to agree.

I am just defining this very roughly.

The CHAIRMAN. You have a bureau in your Department that handles those functions?

Secretary PERKINS. Yes.

The CHAIRMAN. What is the title of the officer of the bureau? Secretary PERKINS. He is known as the "Director of the Conciliation Service," and there is a title known as "Commissioner of Conciliation," who are individuals appointed for the purpose of conciliation. Nevertheless, within the bureau we can perform the other functions.

The CHAIRMAN. How many employees in the bureau?
Secretary PERKINS. Thirty.

The CHAIRMAN. Is it proposed that the functions of that bureau be transferred to this board?

Secretary PERKINS. I should be very loath so to recommend, sir. Senator WAGNER. No.

Secretary PERKINS. I think it is not proposed in this bill. Title III of the bill preserves the Conciliation Service of the Department of Labor. That function should go on and rather be strengthened by the existence of the Labor Board. That is my conception of it. Senator WAGNER. It is preserved by this bill.

Secretary PERKINS. Yes; it is my conception that that function in the Labor Department ought to be preserved and strengthened, sir, and that the cooperation between the Labor Board and the Department of Labor in the performance of the function of conciliation ought to be clearly defined so that the Labor Board may refer cases for conciliation to the Department of Labor rather than attempting to perform the compromise and conciliation service itself, and so, I think, impairing somewhat its prestige as a judicial body engaged in a more serious and more dignified work.

Senator WAGNER. They have been doing that now, Mr. Chairman. The CHAIRMAN. Care has been taken in drafting this bill to prevent any conflict between the powers of the board created here and the Department of Labor?

Senator WAGNER. Oh, yes; there is no conflict now, and, as a matter of fact, we utilize to a great extent through the genuine cooperation of the Secretary, the conciliation clause of the Department of Labor in our efforts to compose differences.

The CHAIRMAN. Proceed.

Secretary PERKINS. On the composition of the board I think that public and the Government members of the board are necessary.

The CHAIRMAN. You are referring to the board?

Secretary PERKINS. To the board as created by this bill. I think that permanent public and Government representatives to give the board continuity, to give it disinterestedness, and to give it the services of persons who gradually acquire from a long period of service a certain expertness in those particular problems.

Moreover, I think it is wise and necessary that there should be members from industry and from labor in order to keep the board in touch with current activities and current thought in the industrial field on both sides, and to keep it from being a purely remote judicial tribunal that has no real and vivid relationship to the industrial needs of the moment.

My own suggestion with regard to this would be that in view of the provision which is made in this bill for its composition, that there should be rather panels from which the employer and employee members can be drawn, and that these panels should be perhaps not less than six or seven on each side, and that employer and employee members should be drawn from those panels to sit for a longer or shorter period of time or to sit even on special cases or special classes of

cases.

I think this would be extremely important in bringing into the board those individuals on both the labor side and the employer side who have particular knowledge of the industry or of related industries in which the controversy is at that moment raging.

It is one of the most difficult things for a meat packer, for instance, to sit with any kind of intelligence upon a dispute in the cotton textile industry, and yet he may be an extraordinarily wise employer, but when it comes down to the particular questions, which, for instance, are involved in the stretch-out, he has relatively no knowledge which makes him a sound judge of what is just and fair.

It has been my experience that men are at their best in a moral sense, that is, their moral aspects function more keenly, when they are in the field of the material that they know well, and that they are inclined to follow somebody else's leadership in the details of a field which they do not know well.

Their principles are all right, but the application of them is sounder when they come into a field which they know well. I should be very much in favor of a panel system.

I also think it is highly important, in drawing up this board, that the employer-employee members of it be so selected that we are certain to escape the inhibiting effects that have so often come about in boards composed of the three parties, by drawing on to the employer-employee membership only the retired people-that is, those who are already out of active relationship to industry. Only by making their period of service short can you be certain to secure for this constructive judicial activity those who are at present in active rela