APPENDIX (Reference to the following will be found on p. 1962.) STAFF SUMMARY OF STEEL WAGE DISPUTE This data and pertinent information with respect to the positions taken by the union, the steel companies, the Wage Stabilization Board, and the Office of Price Stabilization in the steel negotiations was compiled by the staff of the committee from the parties concerned and various other sources. The contract between the steel producers and the steelworkers of America expired December 31, 1951. The union demands presented as 22 issues really involved over 100 different issues. When the case reached WSB not a single one of the union or employee demands had been settled. There were certain courses of action open to the President. These were: 1. Seek an injunction under the "national emergency" provisions of title II of the Labor-Management Relations (Taft-Hartley Act of 1947). This procedure insures continued production for 80 days with a board of inquiry investigation without authority to make recommendations for settlement. 2. Appoint a special board to make recommendations as in the 1949 dispute. This report would have to be approved by WSB. This would mean delay and uncertainty. 3. Refer the dispute to WSB under Executive Order 10233 to "investigate and inquire into the issues in dispute and promptly report to the President thereon with its recommendations to the parties as to a fair and equitable term of settlement." This was the course chosen by the President. THE WAGE ISSUES 1. The steelworkers received their last wage increase totaling 16 cents (of which 31⁄2 cents were for job increments) on December 1, 1950. 2. The steelworkers requested a wage rate increase totaling 181⁄2 cents (which includes 31⁄2 cents for job increments) to (a) catch up to the increase in the cost of living; (b) catch up to what other major industries had received under the Board's policies or rulings; (c) compensate for the admitted increase in productivity in the steel industry. The demands covered a 12-month period but indications were that a longer contract would be considered. 3. If there had been an escalator clause in the December 1950 contract, the costof-living increase based on the October 15, 1950 (latest available at 1950 negotiations), would have entitled the union to 16 cents per hour increase; the November 15, 1950, index would have produced 15 cents; an interpolated index of December 1, 1950, would have produced 131⁄2 cents increase. 4. The steel companies made no counteroffer, however, the companies claimed that under the WSB regulations, GWR 6 (the 10 percent "catch-up" formula) and GWR 8 (the cost-of-living formula) the increase would be 9 cents, using the consumer price index (old series) January 15, 1951, to January 15, 1952. 5. WSB recommended an average wage rate increase of 134 cents (exclusive of fringes) for the year 1952, 121⁄2 cents effective January 1, 1952, and an additional 21⁄2 effective July 1, 1952. For the first 6 months of 1953, WSB recommended a total increase of 171⁄2 cents wage increase or an average for the 18 months period totaling 15 cents increase (exclusive of fringes). 6. Since the date of the last steel contract, the following adjustments have been made in other leading industries. 7. Since January 1950, companies with escalator and annual improvement clauses have received adjustments as indicated by the following. 8. The following wage increases since March 1946 have been received by steelworkers. 9. There have been no fringe adjustments in the steel industry since 1947 (except for a pension plan). 10. WSB claims that their recommendations are in line with fringe benefits prevailing in other important industries. The immediate adjustments totaled 5.1 cents on an annual basis with 3.6 cents additional effective January 1953 to cover 14 premium pay for Sundays. 11. The benefits recommended by WSB included: (1) 6 holidays with pay (none previously). (2) 3 weeks' vacation after 15 years (25 years previously). (3) Increase in second and third shift differentials. (4) Double time for work on holidays (time and one-half previously). (5) Beginning in January 1953, Sunday work would get time and one quarter (straight time now). 12. To recapitulate: 1 Add another .3 cents in the case of United Steel and Republic Steel for the North-South differential. ESTIMATED COST OF WSB RECOMMENDATIONS OPS agrees with steel companies' estimate that the recommended wage increases and other employee benefits would increase the direct wage costs to approximately 30 cents per man hour, when payroll taxes, pension costs and other costs are included General increase in wage rates.. 6 paid holidays (including double time for holidays worked). Increased vacation benefits (3 weeks after 15 years of service). Increased shift differentials (6 cents for second shift; 9 cents for third shift) Total direct cost per employee.. 1 Effective July 1, 1952. 2 Effective Jan. 1, 1953. Primarily applies to U. S. Steel Co. and Republic Steel Co. effective January 1953. THE STEEL COMPANIES' POSITION 13. The steel companies contend that WSB recommendations ignore the fact that "the steelworkers are among the highest paid employees in the American industry; that as recently as 1949 a public panel found the steelworkers suffered no wage inequities in comparison with workers in other industries and that, in the past several years the steelworkers' earnings have increased substantially more than the cost of living." 14. They agree that some of the fringe recommendations are not inconsistent with WSB policy, but are superimposed upon an arbitrary and excessive wage increase; that the most unjustifiable and unstabilizing proposal is for the 14 premium pay for time worked on Sundays. 15. They claim that as a result of the Board's action the Government weight has been thrown behind the union's drive for union shop. 16. The steel companies presented six principal reasons to WSB why the present price and profits will not support the recommended wage and fringe increases stated briefly these are: (1) Profits in 1951 declined 13 percent for the 49 leading steel companies (reporting to American Iron and Steel Institute) responsible for 92 percent of the country's production. (2) The 1951 profits of 5.7 cents on the sales dollar are at a record low for a period of peak-capacity operations; that they are actually inadequate for supporting the huge expansion requested by the Government, and for paying the dividends that will attract new investment. (3) Steel's profit rates of 12.3 percent on total net assets in 1951 was extraordinarily low-17 percent less than the national manufacturing average in 1951, according to recent National City Bank comparisons. |