Senator SHIPSTEAD. Would it not be dishonest to allow him benefits unless there was no work for him? He could be out of work the rest of his life and still obtain those benefits. Mr. LAWLER. No, Senator, he could not, because he would have to have a benefit year established, and then after the expiration of that time, if he did not establish another base year in which he would earn as much as $150, he could not continue to receive benefits year after year. Senator SHIPSTEAD. Would it not be his own fault if he was able to work and refused to work? Mr. LAWLER. I think so. The CHAIRMAN. Suppose that we amended subparagraph (3), on page 11, to read: Any of the 30 days beginning with the day with respect to which the Board finds that he failed, without good cause, to accept suitable work available on such day. Suppose it just ended there, and we cut out the last four words, "and offered to him"? Then it seems to me that if the work was available to him and he did not take it at any time, he could not get his compensation. I do not think that the railroads should be made to say, "At the end of the 30 days we offered this to you," if that is not the case, but if it is made available to him and he refuses to take advantage of it, certainly he should not get insurance. Mr. LAWLER. That is our position exactly, but, under the provisions of the bill, Senator, we do not believe that it would ever be so construed. The CHAIRMAN. Suppose you cut out those words, "and offered to him," that would eliminate it, would it not? You would simply say: any of the 30 days beginning with the day with respect to which the Board finds that he failed, without good cause, to accept suitable work available on such day. Mr. LAWLER. I do not believe that you could establish that the work was available to him without offering it to him. The CHAIRMAN. Why could you not do so? Under the contract and the seniority rule the work is available to him at any time he can go back to it. Mr. LAWLER. Under a well-established business a man could have seniority on the railroad and if he refused to do work when called his seniority would probably cease. Senator SHIPSTEAD. Åre not they called to work according to seniority? Mr. LAWLER. Yes, sir; but when a man just refuses to work, then he voluntarily separates himself from the service. He has resigned; that is equivalent to resignation, when he refuses to work without any good cause. The CHAIRMAN. All right. Suppose he does refuse? Suppose he just simply refuses to go to work when it is offered to him. I do not believe he should be entitled to insurance. He has this contract and he is supposed to go back. He ceases to be a railroad worker, does he not? Mr. LAWLER. I agree with you thoroughly, Senator, that that should be the case, but I do not believe that that would ever be an application of the rules here. Senator SHIPSTEAD. Is not a call to work based on seniority? Is that not in fact an offer of work? Mr. LAWLER. That is true, but under the unemployment regulations, if a man refuses to work without good cause that is usually considered as equivalent to his resignation, and he would be dropped from the seniority list. The CHAIRMAN. If he is dropped from the seniority list by reason. of that, would he not also be dropped as an employee of the company? Mr LAWLER. Yes. The CHAIRMAN. If he is dropped as an employee of the company it seems to me he ceases to be a railroad worker and he would cease to be a beneficiary under this bill. Mr. LAWLER. The bill provides that if a man is discharged he will be disqualified from receiving benefits for a certain number of days. It is slightly different from the number of days when he voluntarily resigns, but there is nothing to preclude him from receiving the benefits that have already accrued to his earnings in a previous year. The only penalty that he suffers is an additional waiting period. He is disqualified for a certain number of days. The CHAIRMAN. I think there is a difference, and it seems to me that there should be a difference, and I think that the railroads themselves would want to have a difference, between a man who refuses or resigns from the railroad service and a man who is laid off. If he resigns voluntarily from the railroad, he ceases to be an employee, and I do not think that the railroads would want him to get benefits, because that would break down their insurance set-up. Mr. LAWLER. That is probably a conflicting reasoning in the bill. A man who is discharged is disqualified for 45 days, as provided in section (II) of section 4, and if he resigns he is disqualified from receiving benefits only for 30 days, as provided in paragraph (I) of section 4. The CHAIRMAN. What have you to say about that, Mr. Hay? Am I right in this, Mr. Hay? Where a man voluntarily resigns from a railroad when he is working as conductor or brakeman or in any other capacity, it does seem to me that he should not come under the benefits of the insurance plan. Mr. HAY. The answer to that is that I should like to call attention to the language on page 6, Mr. Chairman, which provides that no day may be called a day of unemployment The CHAIRMAN (interposing). Where are you reading from? Mr. HAY. That is on page 6. Senator SHIPSTEAD. What line? Mr. HAY. Beginning with: Subject to the provisions of section 4 of this act, a day of unemployment, with respect to any employee The CHAIRMAN_(interposing). I do not find that on page 6. Mr. HAY. Oh, I am sorry; I was reading from the House bill. I beg your pardon. The CHAIRMAN. Where is it in the Senate bill? Mr. HAY. It is at the bottom of page 5, beginning with line 23: Subject to the provisions of section 4 of this act, a day of unemployment, with respect to any employee, means a calendar day on which he is able to work and is available for work. That would mean that the man would have to stand ready and willing to work. Of course, that is read in connection with section 4. Section 4 provides, as you mentioned a moment ago, that upon once leaving employment voluntarily, without good cause, he shall not then be entitled to unemployment benefits for a period of 30 days. There is not the specific provision that after that he would not be entitled to unemployment benefits, but The CHAIRMAN (interposing). Suppose he does voluntarily retire and says, "I am not going to work." Before he is entitled to any benefits should he not go to work or show his intention to work as a railroad employee, because a man might voluntarily retire and then come in and get the benefits? Mr. HAY. I think, from reading that provision in connection with the provisions on page 5 which I read a minute ago, he would not be able to count it as a day of unemployment, because he would not be available for work. The CHAIRMAN. I think that ought to be cleared up so that there will be no doubt about it. Mr. HAY. Very well. We will attend to that, Mr. Chairman. The CHAIRMAN. Yes. Mr. LAWLER. In the third case, an employee became separated from service, registered at an unemployment office in the State where employed, and filed claim for benefits. The unemployment office located a position which this employee refused to take. The State imposed a penalty of an additional waiting period on account of his refusal to accept suitable employment. This man also probably thinks that he was denied proper benefits. This last illustration strongly emphasizes the difficulties of a dual system of employment service and compensation benefits. A press announcement was recently released by the Social Security Board to the effect that 36 State agencies have agreed to accept a plan developed by the Interstate Conference of Unemployment Compensation Agencies and to adopt uniform procedures in connection with the payment of benefits to multi-State workers. State unemployment-compensation agencies participating in the interstate benefit plan will act as registration and claim agents for unemployed workers who have rights to benefits in any other State included in the program and will forward such workers' claims to the liable State for approval and handling. It is expected that the Interstate Conference of Unemployment Compensation Agencies will continue its efforts along these lines to the end that all States may uniformly participate in this reciprocal arrangement. The CHAIRMAN. I am sorry to interrupt, but we have to go on the floor. The Senators are interested in some bills on the calendar, and we have to go over there. How many more witnesses have you? Mr. FLETCHER. One more after this. The CHAIRMAN. We will meet at 10:30 tomorrow morning, then. (Thereupon, at 12:10 p. m., the committee adjourned until Wednesday, June 8, 1938, at 10:30 a. m.) UNEMPLOYMENT INSURANCE SYSTEM FOR EMPLOYEES ENGAGED IN INTERSTATE COMMERCE WEDNESDAY, JUNE 8, 1938 UNITED STATES SENATE, COMMITTEE ON INTERSTATE COMMERCE, Washington, D. C. The committee met at 10:30 a. m., pursuant to adjournment on Tuesday, June 7, 1938, in room 412, Senate Office Building, Senator H. H. Schwartz presiding. Present: Senators Wheeler (chairman), Minton, and Schwartz (presiding). Senator SCHWARTZ (presiding). We will open the hearing and proceed. The chairman will arrive later. Mr. LAWLER. May I proceed, Mr. Chairman? STATEMENT OF ANDREW E. LAWLER, CHICAGO, ILL., GENERAL Mr. LAWLER. At the close of yesterday's hearing I had been discussing the multi-State worker. The proponents of this bill have pointed out the possibility of reciprocal agreements between the railroad and State administrative offices as permitted under section 12 (f) of the bill. It is quite difficult to understand how there could be a reciprocal arrangement between the Railroad Retirement Board and State systems for the payment of benefits when there is no mutuality in the base for payments under the two plans. As an illustration, a base year earning of $200 under a State system would provide benefits only to the extent of about $33 in the following year, or subsequent to the base year, whereas similar earnings under this bill would provide benefits to the extent of $160. Under the typical State plan, an employee would have to earn $840 in his base year before he would be eligible for benefits to the extent of $140, while under this bill earnings of $150 in the base year would produce $140 in benefits. In such cases the question arises as to whether the State obligation would be transferred to the Railroad Retirement Board or the Railroad Retirement Board obligation be transferred to the State. In mentioning the base-year earnings of $150, it should not be understood that this represents average earnings for a railroad employee engaged for an entire year. This is, rather, the seasonal or intermittent worker, who performs incidental railroad service generally |