which applied generally to all of the steel companies in this proceeding. Because of the variations in the contracts the Union's demands had different effects. The Union submitted in evidence the language changes which would be required in its basic agreement with U. S. Steel to give effect to all of its demands. Some of the other companies submitted similar documents indicating the changes which would be required in their contracts if all the Union's demands were to be given effect. During the course of the hearing, it was suggested that 22 demands of the Union probably included more than 100 issues.

Neither the panel report nor this report deals with six issues which the parties believe may be settled among themselves. These isses are: purpose and intent of the parties, adjustment of grievances, arbitration, suspension and discharge cases, safety and health, and military service.

WAGE INCREASE

The Union's request is for a general wage increase averaging eighteen and onehalf (182) cents per hour. Of this amount, three and one-half (32) cents would represent an increase of one-half (1⁄2) cent in the present five (5) cent increment between job classes. The result would be that employees in Class 1 would receive fifteen (15) cents; those in Class 2, fifteen and one-half (151⁄2) cents; those in Class 3, sixteen (16) cents; and so on to thirty and one-half (301⁄2) cents in the top class 32. The increment increase is requested in order to avoid compression in the wage structure that would result from the addition of a uniform cents per hour to the standard hourly rates.

The companies oppose any wage increase and suggest that the best solution is no wage increase and no price increase. Established wage stabilization policy permits increase in wages to keep pace with increased costs of living; such increases, conforming to the general provisions of the Board's regulations, may be instituted without prior Board approval. Increases for other reasons, including interplant comparisons and intraplant realignments, may be approved, on petition to the Board, under established policies and regulations. Millions of American workers have received and are receiving such increases. The steelworkers can hardly be required to accept a status of inferiority.

The Union points out that the rise in the cost of living between October 15, 1950 (the date of the last available BLS Consumers' Price Index at the time of the steelworkers' most recent wage increase) and January 15, 1952, is 8.8 percent. Applied to the current average straight-time hourly earnings of $1.81, this is equivalent to sixteen (16) cents. The Union contends that under Section 5 of the General Wage Regulation 8, a base date of cost-of-living changes prior to January 15, 1951, is appropriate on the ground that there were no freely negotiated increases subsequent to the April 1947 adjustment. companies dispute this contention. The recommended wage adjustment, averaged over the year 1952, is less than equivalent to the cost-of-living change between October 15, 1950, and December 15, 1951.

The

While not requesting an annual improvement factor adjustment, the Union argues that the rise in man-hour productivity in steel production is further justification for the general increase requested. The parties differ in their estimates as to the rate of productivity growth but agree that it has been substantial. The Board has considered the Union's claim based on productivity in arriving at the amount of the recommended wage increase.

The parties have supplied a great deal of material comparing wage rates and wage increases in the steel industry with those in other industries. Wage rate comparisons between industries are inevitably contentious because they involve judgments as to significance; there is no prescribed standard for evaluating the similarities and differences which can always be found. Comparison of wage increases in recent years indicates that while some workers have not fared as well as the steelworkers, many others have received adjustments in excess of those enjoyed by the steelworkers, including the increase recommended below.

Under the circumstances of this case, and taking into account all the equities urged by both sides, the Board recommends that the parties make the following wage-rate adjustment: (1) a general wage rate increase totaling twelve and one-half (122) cents per hour, effective as of the expiration of the contract, or the appropriate reopening date for the particular company; (2) an additional wage-rate adjustment of two and one-half (22) cents per hour, effective six months after the effective date of the above adjustment; and (3) an additional wage-rate adjustment of two and one-half (22) cents per hour, effective six 96315-52-pt. 4-27

months after the effective date of the above two and one-half (22) cent adjustment.

It is further recommended that the above adjustment be the only general wage-rate adjustment allowed for a period of 18 months commencing as of the expiration of the contract or the appropriate reopening date for the particular company. It is further recommended that the question of whether to use any part of these general-wage rate increases for additions to the increment between job classes be left to the parties for a decision.

Equitable distribution of the wage increase is a matter for negotiation; it should not increase the amount determined to be appropriate under stabilization policy. It may well be that in accordance with past practice, the parties will wish to use a portion of this total wage increase for increment adjustments between job classes. The wage recommendation leaves to the parties the decision whether to use any part of the amount recommended for that purpose.

This wage recommendation covers a period of 18 months. It is desirable, therefore, that the length of the contracts be co-extensive. Accordingly, the Board recommends that, in the absence of a contrary agreement between the parties as to duration, the term of these contracts be for 18 months.

GEOGRAPHICAL DIFFERENTIALS

The Union's request for elimination of all differentials between plants and companies can neither be considered nor granted in the omnibus fashion in which it is presented. Existing differentials are not all geographical; they are of a variety of kinds and are negotiated to meet a variety of conditions. The incidence of their elimination would vary widely between the companies, imposing little or no burden on some and very heavy burden on others.

The strictly geographical differential between plants of the same company or divisions of a company is a separate and more specific matter. The leading differential involved in the dispute is the ten (10) cent differential which now exists for southern subidiaries of U. S. Steel and Republic Steel. This differential was decreased from seventeen and one-half (17%) cents as the result of 1947– 1950 negotiations. There is reason to believe that further narrowing by negotiation could have been expected at this time. We recommend that the ten (10) cents per hour geographical differential now existing in the southern plants of certain companies or divisions be reduced by five (5) cents per hour, in accordance with their prior experience. The cost averaged over the amployees in basic steel operations is a small fraction of a cent. With respect to the other differentials involved in the Union's demand, the Board recommends that the parties settle the matter in further negotiations.

SHIFT DIFFERENTIALS; HOLIDAY PAY; VACATIONS

Most of the contracts in the companies involved in this case provide shift differentials of four (4) cents for the afternoon and six (6) cents for the night shift. These shift differentials were established pursuant to a directive order of the War Labor Board in 1944, and have remained unchanged since then. Meanwhile wage levels in the steel industry have risen more than 50 percent and other industries, including those with continuous operations, have subsantially higher shift premiums. We recommend that the differentials be increased to six (6) cents for the afternoon shift, and nine (9) cents for the night shift, effective as of the first payroll period following the issuance of these recommendations or as otherwise agreed upon among the parties.

The contracts in the basic steel industry provide payment of time and one-half for work on six named holidays; no pay is provided for holidays not worked. Holidays with pay have become a prevalent practice in American industry. We recommend that two times the applicable hourly rate for average hourly earnings be paid for six named holidays worked, and that eight hours pay on the same basis be given for the same holidays not worked, effective as of the first payroll period following the issuance of these recommendations. The parties should incorporate eligibility rules, of which there are many examples in other industries, which would deter unwarranted extension of holidays. The companies should avoid, so far as practicable, the scheduling of work on these holidays.

With respect to vacations, we recommend that the requirement of 25 years for three weeks' vacation with pay be reduced to 15 years and that the Union's other demands for increase in vacation benefits (as distinguished from provisions with respect to application) be withdrawn. The issues with respect to application should be negotiated.

These three recommendations provide substantial improvement for the steelworkers. Yet none of them puts the steelworkers out of line with practices prevailing in many areas of the economy. While it is true that some workers do not enjoy benefits of this size, it is undeniable that these or more favorable benefits prevail in the metal industries, automobile, electric, and others, and that they prevail in many of the areas in which the companies operate. Since we believe that the recommended changes only eliminate an existing inequity to the steelworkers and bring them closer in line with other industrial employees with whom they are properly compared, the recommendations are justifiable under General Wage Regulation 13.

SATURDAY AND SUNDAY PREMIUM PAY

The recently expired contracts provided for time and one-half for hours worked in excess of eight in a work day, 40 in a payroll week, and work on 6th and 7th days, under certain circumstances. No provision was made for premium pay for Saturday and Sunday work as such. The Union demands payment of time and one-half for work on Saturday as such and double time for work on Sunday as such.

The difference in this respect between the steel industry and other industries is not fortuitous; rather it results from the different nature of steel operations, many of which require continuous operation seven days a week. While there is controversy as to what portion of basic steel operations are of this character, it is plain that the portion is substantial. To the extent that premium pay is designed to deter work on Saturday or Sunday, it is clear that this purpose cannot be advanced with respect to much of the basic steel operation.

The Union's full request, if applied to existing schedules in the industry, would add a substantial cost, much of which could not be avoided by rescheduling. Such an addition at the present time, with the dangers to production which the demand involves, cannot be justified.

Yet there is great merit in the contention that employees required to work on Sundays be paid some premium above the rate received on week days. The situation may be likened to undersirable shifts for which premium is paid. The companies here involved recognized a similar situation when they agreed some years ago to pay time and one-half for work on specified holidays. And the practice of granting additional compensation for work on Sundays has gained widespread and growing acceptance in industry. The Board recommends that effective January 1, 1953, time and one-quarter be paid for all hours of work performed on Sundays as such.

GUARANTEED ANNUAL WAGE

The Union's proposal is for supplemental unemployment compensation. It contemplates that each employer is to create a trust fund by contributing a given cents per hour. From this fund employees with stated seniority who are laid off would receive payments of given amounts for stated periods of unemployment. The amounts receivable from State unemployment compensation funds would be credited against such payments. To the extent that benefits under the State laws would be improved, the cost of the supplemental compensation would be reduced.

Estimating the cost of such a plan is more difficult and more hazardous than estimating the cost of pensions.

The Union proposes, however, that the cost be limited to a fixed cents-per-hour contribution by the employers to the trust fund and suggests the figure of about seven (7) cents per hour. This item is not like the holiday, shift differential, or vacation allowances, which we have recommended in addition to the general wage increase because, with respect to them, the steel workers have fallen behind other industries. It is rather an item little known in industry. Under present circumstances, were a plan of the kind adopted, its cost would have to be deducted from the amount of the wage increase recommended by the Board.

The guaranteed wage proposal raises serious and complex problems of public policy as well as private interest. The proposal originated in 1943 in a demand of the Union and resulted in an extensive governmental study published in 1947. The parties have not bargained about the matter in the intervening years. If, indeed, the matter is one which should be referred to collective bargaining, as the Advisory Committee of the Office of War Mobilization and Reconversion reported in 1947, it has not received the joint consideration that collective bargain

ing implies. A determination by the Board would hardly be the equivalent of collective bargaining in this area. The problem requires serious joint consideration.

We recommend that the parties undertake a joint consideration of the problem during the period of the next contract, with a view to reaching mutual understanding by the time of the next negotiations. Such joint consideration will result in collective bargaining, which alone can find the appropriate solution. To facilitate this joint consideration during the period of the next contract the parties should agree to use the services and advice of a neutral third party or parties.

SEVERANCE PAY

4 At present, severance allowances are payable only upon termination due to permanent closing. The Union now proposes that these allowances be extended to all lay-offs and all terminations.

Inasmuch as the severance pay issue is closely related to the guaranteed annual wage proposal, the Board recommends that these two issues be considered together by the parties. In connection with severance pay, the Board suggests that the parties consider the desirability of an arrangement which would require reasonable notice in advance of lay-off or severance, other than for cause, and provide reasonable compensation for failure to give such notice.

TECHNOLOGICAL DEMOTIONS

The Union proposes a new provision whereby the companies shall guarantee to each employee demoted as a result of technological change or abandonment of facilities an amount each week, for a period of 52 weeks subsequent to his demotion, at least equal to his prior average earnings. This proposal would introduce inequities in the wage structure and is in fact contrary to the principle of standard hourly rates. There is no clear justification for treating demotions of this character differently from demotions due to reductions in force for other reasons. The Board recommends, therefore, that the Union withdraw its demand.

HOURS OF WORK AND OVERTIME

There is considerable variety in the steel contracts with respect to hours of work and overtime provisions. The issues relate to the scheduling of operations and employees-a subject of great complexity, requiring attention to the precise circumstances at each plant. The subject is especially suited to collective bargaining. The Union's chief complaint is against the lack of penalties or compensation in cases of violation of the contractual provisions ,with respect to scheduling. It complains also of instances in which employees are required, contrary to the schedule, to work a split shift or to report some time earlier or later than their scheduled starting times. These deviations from schedule are sometimes dictated by necessity; sometimes they result from poor or mistaken planning; frequently they are due to the desire to avoid premium pay for sporadic overtime for short periods.

An attempt by the Board to prescribe scheduling practices generally for all companies in this proceeding would not be feasible. The general provisions with respect to scheduling must be left to negotiations by the parties. The Board recommends, however, that the parties agree upon premium or penalty compensation for sporadic rescheduling of individuals in violation of contractual provisions and for sporadic change in an employee's starting and quitting time to avoid payment of daily overtime. Similarly, the Board recommends that the parties avoid the working of split shifts whenever practicable and that extra compensation in the form of either premium pay or reporting allowance be provided to employees compelled to work split shifts.

REFORTING ALLOWANCE

The Union proposes an increase in the reporting allowance from four hours to eight hours and some changes in the rules as to its application. The matter of change in the rules as to application is referred back to the parties for negotiations without recommendation, since it involves details which it is believed the parties can resolve. Four hours reporting allowance is common in American

industry; eight hours is not. The present provision, therefore, involves no inequity for steel workers in comparison with other industrial workers. The Board, therefore, recommends that the Union withdraw this proposal as part of these negotiations, but that the parties consider the underlying question in connection with the guaranteed annual wage.

CONTRACTING OUT

The Union proposes to add a provision to the contracts requiring that all production, maintenance, repair, construction, experimental, and hourly rated, nonconfidential clerical work be done by employees of the companies except as the parties may otherwise agree. No such clause appears in the recently expired. contracts, except for a few which contain provisions of considerable narrower scope.

The effect of such a provision would vary greatly among companies. Some have the manpower or equipment to do a variety of work, while others are not so equipped. All, however, may find it necessary or highly desirable to contract for construction work which they either are not equipped to do, or can do only by hiring new employees for short periods, or can do only by taking more time than' is available. It is hardly a sufficient answer to predict that the local union would agree to contracting out in such circumstances.

The proposal would impose a heavy restriction upon normal managerial responsibility and would be contrary to accepted industrial practice. It would have serious consequences on important interests other than those of the parties. The proposal is not needed to prevent contracting out which would have the effect of unreasonably narrowing the bargaining unit; the Board of Arbitration under the U. S. Steel contract has ruled that the expired contract, without the proposed clause, prohibits such contracting out.

The companies state that it is their deliberate policy to provide work for. their employees and to use them as much as practicable for all work on the properties involved. They assert that they contract work out only when that course is required by business conditions such as lack of available time, available equipment, manpower, and the like. Proper execution of this policy is particularly important when employees are on layoff. In view of these statements,. the Board recommends that the Union withdraw this proposal in the current negotiations.

UNION SECURITY

The Union is vested by law with the right and the duty to bargain on behalf of all employees in the various units covered by collective bargaining contracts, on wages, hours, and terms and conditions of employment, including union security.

The form of union security presently provided for in contracts between the Union and most of the steel companies, is maintenance of membership and checkoff. Under this arrangement all employees who are now members of the Union, and all employees who may join the Union in the future, must continue' to maintain their membership for the duration of the collective agreement as a condition of employment. What this obligation boils down to is that Union. members must pay the prescribed periodic dues to the organization which has been selected by a majority of all the employees as their bargaining representative. The prescribed initiation fee and periodic dues are checked off and paid directly to the Union by the employers for those employees who agree to this. arrangement.

In this case the Union is requesting that the present maintenance of membership arrangement be changed to the union shop as authorized by the Labor Man-. agement Relations (Taft-Hartley) Act of 1947, as amended. In substance, this arrangement would extend the present obligations of Union members to all employees in the bargaining unit. Specifically, all employees in the bargaining unit would be required, as a condition of employment, to pay to the Union. a uniform initiation fee and periodic dues.

A union might attempt to deny membership to an applicant or to expel a member even though he was willing to pay the standard initiation fee and dues. The Taft-Hartley Act would, however, protect such employees from discharge under the proposed union-shop agreement. Where State laws prohibit union-shop provi-. sions, the request for a union shop cannot be considered unless it is modified to the extent necessary to comply with the provisions of such State laws. The. Union's request is so modified.