exacerbate the present problems that we have, then I think we are illadvised to go ahead until we eliminate some of those problems.

Secretary GOLDBERG. May I say this. First of all, I want to emphasize something. I think we have to define our terms.

On the missile sites, since we established the Missile Sites Labor Commission, there has been no jurisdictional problem between industrial unions and the craft unions.

The problems that we have had in jurisdiction have been straight jurisdictional problems between craft unions unaffected by any DavisBacon interpretation. I want to point that out, No. 1.

No. 2, I want to point out also that it is my considered judgment as the Administrator of this program that if you did not have a DavisBacon Act you would have far more disputes than you have under the Davis-Bacon Act. That has been a very stabilizing influence.

Mr. GOODELL. I do not mean to imply that we ought to do away with the Davis-Bacon Act. I expressed my sympathy with its objectives originally but this act has not been reviewed for some time at the legislative end and I think perhaps it needs a thorough reviewing to see if we can modernize it a little bit and bring it up to the present problem.

For instance, it is my understanding that many of these jurisdictional problems have been solved with the happy device for the laboring people, I guess, of having one group stand by and watch the other groups do the work and both of them get paid. This is not a very happy solution for the American people. It may stop them from going on with picketing and striking.

Mr. ROOSEVELT. It is now 10 minutes of 12. The House has a very important measure before it, considering its size, shortly after 12 o'clock. We do want to hear Mr. Biemiller because he will not be able to be with us tomorrow.

I would like to ask if it is agreeable to the minority members of the committee, and I have already checked with the majority members, that we meet again on Monday morning.

Mr. Secretary, I realize we cannot expect you to come but would it be possible for the Solicitor who really is the person I think under fire here and anybody else to be here with him?

Would it be agreeable with the minority to meet tomorrow morning at 10 o'clock and have the Solicitor come back and we will go into some of these things more deeply which do not relate directly to the merits of these particular proposals?

Mr. GOODELL. I have no objection. I think this points up, however, the need we have to go into this at some length with longer hearings. I would hope that Mr. Biemiller is not going to be here for 7 minutes and unavailable thereafter, either. I think he can shed a lot of light on this. He deals with this every day. He is certainly an expert in the field.

I hope you are not contemplating we are going to ask Mr. Biemiller to condense his testimony and answer some questions in a 5minute period.

Mr. ROOSEVELT. No; I do not think that would be possible.

But I think we will have to get Mr. Biemiller to come back, also. As I am sure the gentlemen on both sides know, we have never tried to railroad anything through. We are not doing it here. If it be

comes obvious that additional hearings are necessary, we will get together and hold them.

Mr. GOODELL. I think we can agree it is obvious.

Mr. ROOSEVELT. Mr. Goldberg, did you want to make a final statement?

Secretary GOLDBERG. I appreciate your courtesy and the opportunity to be here.

Mr. MARTIN. May I ask two questions of the Secretary?

Mr. ROOSEVELT. Yes.

Mr. MARTIN. I believe in your testimony, Mr. Secretary, you stated that the total man-days lost had been reduced from approximately 8,000 to 2,000, was it?

Secretary GOLDBERG. I do not remember the exact figures. I shall be glad to file for the record our report to the President which gives the exact figures. I think, actually, it is a better record than that. The 7,000 or 8,000 is an average record. The 2,000 we are talking about is the record for January.

I think actually our performance is much better than the average. Mr. MARTIN. This is at missile sites. I have before me man-days lost at Lowry and, for instance, this is September 1961 during which period you said it had been reduced. Now they had 740 man-days lost at that one missile site.

Here is one in Kansas and in September of 1961 they had 229. Now, there is a total in only two of our missile sites out of 40 or 50 where you have slightly under a thousand man-days lost.

Secretary GOLDBERG. Yes; but the interesting thing is, taking our 2,000 last month, there were only two sites involved. In the 19 others we had no man-days lost at all. So this is not a strange thing.

Our trouble spots arise here and there. For example, Cape Canaveral used to be very troublesome. Since we have had our Commission in operation we have had virtually no man-days lost at Cape Canaveral.

Mr. MARTIN. I have one other question. In regard to this missile site report, this Holland report, I notice that they recommend that the Davis-Bacon apply to the construction phase of missile work, not the installation and checkout, that that be excluded from the DavisBacon.

Would you care to make any comment in regard to that recommendation?

Secretary GOLDBERG. I think I ought not to make a comment until I appraise all the arguments pro and con and I make a ruling.

At the present I am sort of in a position of a judge who has a case under advisement. I think it would be prejudicial for me to say so until I have examined all the arguments.

Mr. GOODELL. Do you not think that this very fact, how important that ruling is in the Davis-Bacon to the jurisdictional dispute points up the ramifications of the Davis-Bacon as far as jurisdictional problems are concerned?

Secretary GOLDBERG. Again I do not want to prejudge what I finally say. I may have something to say. I do have some ideas on this subject.

Mr. GOODELL. You would not even agree today on the generality that the Davis-Bacon Act is important in the jurisdictional disputes problem at the missile bases?

Secretary GOLDBERG. I do not want to agree to that because I think I will have something to say on the subject. I will be glad to file my statement here.

Mr. GOODELL. I think you did agree earlier.

Mr. ROOSEVELT. Mr. Secretary, to conclude this, however, these two amendments are not involved in that at all.

Secretary GOLDBERG. Not at all.

Mr. GOODELL. Mr. Chairman, I must sincerely dissent. The extension of the provisions of Davis-Bacon is certainly involved with unnecessary problems caused by present administration of Davis-Bacon.

Mr. ROOSEVELT. However, these two amendments, the Secretary has told us, have never been in dispute or have had anything to do with the jurisdictional phases, these two amendments in this particular field. That is the only point I want to make.

I want to thank you, Mr. Secretary. I would like to request that Mr. Donahue be available at 10 o'clock on Monday. Secretary GOLDBERG. He will be here.

Mr. ROOSEVELT. Thank you very much.

Mr. Biemiller, will you come forward at this time?

We want to welcome you not only as an old colleague before the committee but also because we know that as legislative representative of the AFL-CIO, you are in a very proper position to advise the committee concerning the subject matter before it.

I am sorry we are so late.

I will say to you as I said to the Secretary that if you do not finish, if you cannot be available tomorrow, we will try to schedule some time on Monday.

Mr. BIEMILLER. On Monday, Monday morning.

Mr. ROOSEVELT. We will try to do it Monday morning.

If it is agreeable with you, we asked the Solicitor to come at 10. If the committee can gather at 9:30, would you be available at 9:30? Mr. GOODELL. Mr. Chairman, I think we need more than half an hour.

Mr. ROOSEVELT. Do you gentlemen think we can finish?

Suppose we start with the Solicitor at 9:30 and ask Mr. Biemiller to be here at 11?

Mr. GOODELL. Yes.

Mr. ROOSEVELT. Mr. Biemiller, will you proceed?

STATEMENT OF ANDREW J. BIEMILLER, DIRECTOR, DEPARTMENT OF LEGISLATION, AMERICAN FEDERATION OF LABOR AND CONGRESS OF INDUSTRIAL ORGANIZATIONS

Mr. BIEMILLER. Yes. My name is Andrew J. Biemiller. I am Director of the Department of Legislation of the American Federation of Labor and Congress of Industrial Organizations, and I am appearing today to present the views of that organization on H.R. 5622, a bill to amend the Davis-Bacon Act, and H.R. 9657, a bill to amend the 8-hour law.

The Davis-Bacon Act, which requires the Secretary of Labor to determine the prevailing wage rate and establish it as a minimum wage rate on a variety of Federal and federally assisted construction projects, was originally enacted in 1931.

It is interesting to note that both authors of the bill, Senator James J. Davis, of Pennsylvania, and Representative Robert Low Bacon, of New York, were Republicans. Senator Davis, prior to his election to the Senate in 1930, had served as Secretary of Labor in the Cabinets of Presidents Harding, Coolidge, and Hoover. Representative Bacon was a banker before his election to the Congress in 1922. The law was signed by President Hoover. The principle of the law has been extended under both Democratic and Republican administrations.

In advocating congressional action in this field, Representative Bacon made the following statement:

I want to cite the specific instance that brought this whole matter to my attention. The Government is engaged in building in my district a Veterans Bureau Hospital. Bids were asked for; several New York contractors bid, and in their bids, of course, they had to take into consideration the high labor standards prevailing in the State of New York. I think I can say that the labor standards in New York are very high. The wages were fair, and there has been no difficulty in the building trades between the employee and employer in New York for some time. And the situation existed therefore, and the New York contractors made their bids, having the labor conditions in mind. The bid, however, was let to a firm from the South and some thousand nonunion laborers were brought to New York in my own congressional district. They were hired into this job, they were housed, and they were paid a very low wage, and the work proceeded. Of course, that meant that labor conditions in this part of New York State where the hospital was being built were entirely upset. It means that the neighboring community was very much upset.

In order to overcome this and similar situations throughout the Nation, the Congress adopted prevailing wages for Federal construction as public policy. It is interesting to note that the bill passed the Senate on a voice vote and the House under suspension of the rules-requiring a two-thirds majority-also on a voice vote.

The Davis-Bacon Act was designed to provide equality of opportunity for contractors, to provide for the employment of local craftsmen, to protect prevailing living standards of the building tradesmen, and to prevent disturbance of the local economy. It recognized the community of interest between the local community, contractors, and building tradesmen. The Davis-Bacon law, as originally enacted, required the payment of prevailing wages to laborers and mechanics in the locality where construction, repair, or alteration of Federal buildings was to be performed. Under this equitable standard contractors were free to compete against each other in efficiency, knowhow and skill, rather than in terms of their ability to depress the prevailing wage structure in a locality. Since 1931, the Congress has on many occasions reaffirmed this bipartisan fundamental principle of public policy. When the Congress during the 1930's embarked on vast public work undertakings, it amended the Davis-Bacon Act, in 1935, to extend its coverage to Federal public works.

Davis-Bacon provisions have been extended by the Congress in recent years to apply to a number of Federal grant-in-aid programs, including the federally impacted areas school construction program, Hill-Burton hospital construction, the Federal interstate highway and Federal airport programs, the water pollution control program, and the National Housing Act.

Thus the Davis-Bacon Act has withstood the test of time and has enjoyed the support of members of both political parties and of Presidents from both political parties.

The reason we are appearing today, Mr. Chairman, is that DavisBacon prevailing wage standards are in urgent need of modernization. Since the enactment of the original statute, which applies only to many wages, there has been a dramatic growth in the number of socalled fringe benefits health insurance, pension programs, life insurance programs, and apprenticeship training programs-negotiated through collective bargaining.

These programs are of benefit not only to the workers themselves, but to society generally. They serve to keep families together during periods of stress, to provide adequate health care for members and their families, and to provide adequate income for retired workers. Thus, they aid substantially to the independence of workers and their families.

Because so many workers have elected to take a part of the wage increases they would otherwise be able to negotiate in these fringe benefit plans, there is a growing disparity in the wage costs of contractors on Federal construction projects. Fringe benefits costs now represent a very significant proportion of the wage costs of many contractors, while a few are able to escape them entirely.

So long as the cost of these added fringe benefits are not included in Davis-Bacon prevailing wage determinations by the Secretary of Labor, we are increasingly more likely to return to the unconscionable conditions which Representative Bacon illustrated in his statement to which I referred earlier.

Contractors who do not have welfare programs for their employees can come into a local area, and, simply because their labor costs are lower, undercut already established fair employers who do contribute to these programs for their employees. When this happens it means that local building tradesmen who have elected to take wage increases in the form of benefit programs in order to provide for their families are depriving themselves of work which they could otherwise obtain. The fair employer who is participating in this noble experiment, in a free society, by an industry to provide for its workers and their families is, ironically, thereby placed in a steadily deteriorating competitive position. This grossly unfair competitive situation in which fair contractors, abiding by local prevailing standards, are placed at a disadvantage in bidding on Federal or federally assisted projects was precisely the situation which the Davis-Bacon Act was designed to remedy. H.R. 5622 would eliminate the unfair competitive advantage which unfair contractors currently enjoy. It would equalize competition between employers and thus protect and preserve established and prevailing wage standards in the building and construction industry.

H.R. 5622 would require the Secretary of Labor to include in his wage predeterminations under the Davis-Bacon Act the prevailing rate of payments to benefit plans for the purpose of providing medical or hospital care, pensions or retirement, life insurance, sickness, accident or disability insurance, and unemployment benefits or for defraying costs of apprenticeship or other training programs.

The bill would modernize the Davis-Bacon Act by eliminating the most glaring loophole that has developed in its structure.

82281-62- 4