THE LAST YEAR OF ADMINISTRATION OF THE WAGNER ACT

THE functioning of the National Labor Relations Board under the

Wagner Act, which became effective on July 5, 1935, came to an end on midnight August 21, 1947. On the following day, the Board entered upon its vastly increased domain of activity under the Labor Management Relations Act of 1947. Thus, the fiscal year that ended June 30, 1947, became the last full year of operation under the Wagner Act.

The past year was one of unprecedented activity for the Board: More cases were received than in any of the agency's preceding 11 years. More cases were handled to conclusion than in any similar period. The Board was called upon to express its views in writing and in oral testimony on many of the bills that were introduced in the Eightieth Congress.

During the past year the Board performed its statutory functions to the best of its ability, but it was hampered by an unprecedently large case load and a limited appropriation. Unsettled labor-management relations growing out of the postwar reconversion period continued to form the basis for the perpetuation of a heavy work load. The Board continued to effectuate its dual tasks of (1) remedying and eliminating employers unfair labor practices which impeded collective bargaining, and (2) providing the means whereby controversies as to the choice of bargaining representative by employees could be resolved.

The effects of the National Labor Relations Act were demonstrated by the relatively small number of organizational strikes that occurred in 1946. The act was designed specifically to reduce industrial strife arising from disputes concerning union organization and recognition; it was not framed to deal with disputes arising from differences as to the substantive content of labor agreements, such as wages, hours, and working conditions. Although 1946 was characterized by a heavy strike wave, mainly over wages, strife of the type that the Wagner Act was devised to mitigate constituted only a small proportion of total strike activity. Strikes falling within the purview of the Wagner Act accounted for less than 12 percent of the workers involved in all 1946 strikes and represented about 15 percent of the total time lost in work stoppages.

Almost 15,000 new cases were filed with the National Labor Relations Board in the year ended June 30, 1947. This was an all-time high, even exceeding the previous record-breaking total of 12,260 cases filed in the prior fiscal year. In August 1946 the Board received more

new cases than in any month in its 12-year history. After the peak of 1,662 new cases received in that month, the monthly case input declined somewhat and then leveled off for the rest of the fiscal year. The average number of new cases received in the period from January to June 1947 approximated 1,100 per month.

Two kinds of cases arose under the National Labor Relations Act of 1935, "representation cases" and "unfair labor practice" cases. Representation cases were instituted by petitions filed by unions or employers, requesting Board action to determine whether or not workers wished to select representatives to engage in collective bargaining. Unfair labor practice cases arose from charges filed by unions or employees alleging that employers had committed unfair labor practices. These included such charges as discrimination against an employee because of his union membership or activity, promotion of a "company union," refusal to recognize a union which represented a majority of employees in an appropriate bargaining unit. (See Ninth Annual Report, ch. II, for explanation of procedures in case handling.)

Both types of cases handled by the Board were received in greater volume in the past fiscal year than in fiscal 1946. A total of 4,232 unfair labor practice cases were received or about 11 percent more than during the previous year (3,815). The number of representation cases rose to 10,677 from the previous year's figure of 8,445, an increase of about 26 percent.

Continuing a trend established in recent years, unfair labor practice cases constituted a decreasing proportion of total cases received. Only about 28 percent of the year's cases involved unfair labor practices, as compared with 31 percent for the previous year. The proportion of representation cases thus rose from 69 to about 72 percent. However, in absolute numbers, each year since 1945 has been characterized by an increase in the number of unfair labor practice cases. A continuation of the trend in the proportional relationship between the two kinds of cases resulted in the last 2 years from the substantially increasing volume of representation cases, rather than from the decline in the number of unfair labor practice cases that characterized the years from 1942 through 1945.

Almost two-thirds of charges brought in the past fiscal year asserted that employers had committed some act of illegal discrimination against employees or applicants for employment. Alleged refusal to bargain was next in number, accounting for about 32 percent of the charges. Sponsorship of "company unions" or other illicit assistance to labor organizations was charged in only about 7 percent of cases, a lower proportion than in any prior year.

More cases were closed in the past fiscal year than in any prior similar period; 14,456 cases were disposed of, as compared with the previous high of 11,741 in 1942. Over 83 percent of the cases were closed in the past fiscal year by informal means usually in the regional offices. Such informal settlements meant tremendous savings of time and money for management, labor, and the Government, and also made for improved future labor relations through avoidance of protracted litigation. The Board closed 4,014 unfair labor practice cases in the past year, disposing of 3,722, or almost 93 percent of the total, by informal means. About 74 percent of the unfair labor practice cases

were closed in the past year through withdrawal of the charge by the charging party or dismissal by the Board. Of a total of 10,442 representation cases closed during the same period, 8,331, or almost 80 percent, were adjusted without formal proceedings.

During the past year 1,030 unfair labor practice cases were closed through adjustment or compliance with formal recommendations or directives. Compliance actions taken by employers in these cases included the reinstatement of over 4,000 illegally discharged workers, as well as of 964 individuals who participated in strikes found to have been caused by employers' unfair labor practices. Employers also distributed $1,104,660 in back pay to 2,656 workers against whom illegal discrimination had been practiced. In 658 cases, notices were posted by employers advising their employees that they would refrain from committing certain unfair labor practices and would take the affirmative action ordered by the Board. Employers disestablished unions found to be company-dominated in 36 cases.

The Board conducted 6,920 elections in order to determine whether and by whom employees desired to be represented for the purposes of collective bargaining. Several types of elections and cross checks were employed by the Board. (See Ninth Annual Report, ch. II, and Eleventh Annual Report, pp. 6-8, for description of the various kinds of elections and cross checks conducted by the Board.) Of the 6,920 elections, 5,400 or 78 percent, were based on the full agreement of the parties, the remaining 22 percent were ordered by the Board and its agents in prehearing election cases.

Of the 934,553 persons eligible to vote in Board elections in the past year, 805,474 or 86 percent of those eligible, cast valid ballots. Of the latter number, 621,732, or about 77 percent, cast their votes for a labor organization; 183,742 workers, or about 23 percent, voted against being represented by a collective bargaining agent.

Of the 6,920 elections conducted by the Board, 5,194, or 75 percent, resulted in the election of a collective bargaining representative. No union was designated in 1,726, or 25 percent, of the elections. Approximately 79 percent of the elections in the past year involved a choice for or against a single union as bargaining representative; 1,406, or about 20 percent, involved two unions, while only 1 percent involved 3 or more competing labor organizations.

By means of the prehearing election procedure, introduced in December 1945 (see Eleventh Annual Report, pp. 6-7), the Board was able to effectuate a reduction in the number of representation case hearings and Board-ordered elections.1 Of 626 prehearing election cases closed in the past fiscal year, only 172 required subsequent hearings; thus, hearings were entirely avoided in 454 cases. After the introduction of the prehearing procedure, the number of Board-ordered elections declined both absolutely and relatively. In the fiscal years 1944 and 1945, Board-ordered elections were necessary in over 1,500 cases in each year and accounted for about 32 percent of all elections. In fiscal 1946, the first year that prehearing elections were used, the number of Board-ordered elections declined to 1,163, or about 21 percent of the total. In 1947, the first full year of the new procedure, the

1 Sec. 9 (c) of the National Labor Relations Act as amended bars the Board from using prehearing elections (or any cross check) in the future.

number of elections ordered by the Board itself had dropped to 876, or less than 13 percent of the total.

In the past fiscal year, affiliates of the American Federation of Labor won certification in 2,196 elections, with a total of 208,524 votes; affiliates of the Congress of Industrial Organizations won 2,138 contests, with 288,381 votes; unaffiliated unions won 860 contests, with 124,827 votes. No union won in 1,726 elections, with a total of 183,742 votes against any union representation.

The influx in the past fiscal year of more cases than ever before in the Board's history, accompanied by the cut in the Board's appropriation which necessitated laying off over 20 percent of its employees, resulted in the Board's carrying over the unprecedented number of 5,058 cases into the new fiscal year beginning July 1, 1947.* This carry-over was almost 10 percent in excess of the previous record high of 4,605 cases pending on July 1, 1946. The backlog of unfair labor practice cases as of July 1, 1947, amounted to 2,443 cases as compared with 2,615 representation proceedings.

The National Labor Relations Board, in the 12 years of operation from July 5, 1935, through August 21, 1947, had received over 105,000 cases. Of these, about 60,000 involved representation questions, while about 45,000 involved allegations of unfair labor practices. In that period the Board disposed of 43,556 unfair labor practice charges and 57,852 representation proceedings, or a grand total of 101,408 cases. Over 81 percent of all cases closed were disposed of without resort to formal Board action; almost 91 percent of unfair labor practice cases were concluded by informal means and less than 26 percent of representation cases required formal treatment.

In the 12-year period before the amendment of the act (excluding 1936, 1937, and part of 1938 for which data are unavailable), the Board effected the reinstatement of over 300,000 workers who were found to have suffered discrimination in violation of the act. Almost 41,000 workers received back pay, totaling nearly $12,560,000. More than 1,700 company unions, found to be employer-controlled, were disestablished. More than 8,000 notices were posted by employers. Collective bargaining was begun as a result of Board action in over 5,000 unfair labor practice cases during the period that the Wagner Act was in effect.

The Board conducted nearly 37,000 elections in the 12-year period, almost 74 percent of them by consent. Labor organizations won 30,110 elections and cross checks, or over 81 percent of the total. Of the 9,131,659 workers eligible to participate in such elections and cross-checks, 7,677,135, or 84 percent of the total cast valid votes. This demonstrates the high degree of employee interest in having an opportunity to select or reject a collective bargaining representative.

Only 3,937 cases were pending when the Labor Management Relations Act became effective on August 22, 1947.

Five Board cases were decided by the United States Supreme Court in the year ended June 30, 1947. In four of these cases Board orders were enforced in full. The Board was reversed in none of these cases, one being remanded to the circuit court of appeals. Of the 70 Board cases decided by the United States circuit courts of appeals in the same period, Board orders were enforced in full in 49, or 70 percent of the cases. Ten orders were enforced in part, 10 were set aside, and 1 was remanded to the Board for further proceedings. During the entire 12-year period of the operation of the Wagner Act, 59 Board cases were decided by the United States Supreme Court. Board orders were enforced in full in 45, or in over 76 percent of the cases decided. Only two orders were set aside by the Supreme Court and nine Board orders were enforced with modification. Of the three remaining orders, one was remanded to the Board, one was remanded to a circuit court of appeals, and the Board's request for remand or modification of the third was denied by the Court.

Hearings on Amendments to the National Labor Relations Act

During the first session of the Eightieth Congress approximately 60 bills dealing with the field of labor management relations were introduced in the Senate and in the House of Representatives. On January 23, 1947, the Committee on Labor and Public Welfare of the United States Senate began hearings on the bills and resolutions referred to it. These hearings covered not only bills proposing amendments to the National Labor Relations Act, but also all bills dealing with such matters as the organization and responsibility of labor unions, proposals for labor courts and compulsory arbitration, proposals for mediation and conciliation, and proposals dealing with the closed shop and Nation-wide bargaining. The hearings were con

Icluded on March 13.

In response to the request of the committee, the Board submitted a written statement on pending labor legislation, which was incorporated into the record of the committee's proceeding. This statement was submitted in conjunction with the testimony of Chairman Paul M. Herzog, who appeared before the committee on March 6.*

In the report submitted to the committee, the Board observed that as an agency of the United States it was "concerned with the public interest and with that interest alone," and that it appeared before the committee "as the trustee of the Congress for the administration of the National Labor Relations Act." The Board stated that, just as it was not its province as a trustee to fix the terms of the deed of trust that gave it being, it was not its responsibility to decide whether those terms should be altered, that being a matter for Congress to decide. The report and testimony contained an analysis of various proposals directly affecting the work of the Board.

On February 5, 1947, the committee on Education and Labor of the House of Representatives began hearings on the labor bills re

* Statement of Paul M. Herzog, Chairman of the National Labor Relations Board, on pending labor legislation before the Senate Committee on Labor and Public Welfare, March 6, 1947, printed in hearings before the Committee on Labor and Public Welfare, U. S. Senate, 80th Cong., 1st sess., on S. 55 and S. J. Res. 22 (hereinafter referred to as hearings), pt. 4, pp. 1901-1936, inclusive.

Statement of the Chairman of the National Labor Relations Board, Washington, D. C., pt. 4, May 6, 1947, pp. 1847-1901, inclusive.