Mr. ROOSEVELT. What is wrong with that?

Mr. GOODELL. We will argue what is wrong with it. I think it is not going to help the unions very much in this respect.

Mr. ROOSEVELT. I would let the unions worry about that, I guess. Mr. GOODELL. I have a final question. How many instances have you seen where they resolved jurisdictional disputes by letting both groups of workers stay on the job and pay both of them while one of them does the work?

Mr. KNACK. Mr. Goodell, I am afraid you are entering in an area there where it is a matter of policy of the company. I think where those things happen, I cannot in all honesty say that they are not happening without the fault of the employer. I can only answer insofar as our company is concerned, that we have a very firm policy against featherbedding. We have a very firm policy that when a question of jurisdiction comes up, that the parties, including ourselves, will live up to the documents and our agreement as to what we shall pursue. We do not subscribe, nor have we ever subscribed,

to the fact that we have one craft who stands and watches other crafts do the work as a means of solving our jurisdictional procedure, because we believe if we do that by practice, then we are making a hypocracy of the procedures that we have agreed that we were going to follow. I say were that to exist, I think all people, labor, management, and Government, should be thoroughly shocked by it and all parties who contribute to it should be thoroughly censured. I do not think that it is a thing that has to exist.

Mr. GOODELL. I agree with you, and I am reassured by your statement that it does not occur at least in your instance. I notice that there are statements made, particularly in the McClellan investigation, particularly where the Government is picking up the tab on it ultimately, that the employer does not resist it, since he is not going to pay it anyway, the Government will pay it, and this is sometimes the simples way to solve the whole thing. Just let them go ahead and work and the other group stands and watches. I am glad to hear you do not do that.

Mr. ROOSEVELT. Mr. Knack, I want to thank you again for your cooperation with the committee. We will look forward to receiving from your good counsel the material which has been requested. We wish you a good trip back.

Mr. KNACK. Thank you.

Mr. ROOSEVELT. We would like to hear from Mr. G. R. Collins, president of the National Constructors Association.

Mr. Collins, we want to welcome and thank you for bearing with us and being with us this morning. Would you introduce the gentleman with you?

STATEMENT OF G. R. COLLINS, PRESIDENT OF THE NATIONAL CONSTRUCTORS ASSOCIATION; ACCOMPANIED BY JACK WALLING, CHAIRMAN OF THE LABOR COMMITTEE, NATIONAL CONSTRUCTORS ASSOCIATION

Mr. COLLINS. The gentleman with me is Jack Walling, chairman of the labor committee of our organization, the National Constructors Association.

Mr. ROOSEVELT. We are very happy to have you with us, sir.
Mr. WALLING. Thank you.

Mr. COLLINS. My name is G. R. Collins of Rye, N.Y. I am vice president and director of construction of the Lummus Co. of New York City. I am appearing today, however, as president of the National Constructors Association. This association, known as NCA, has its headquarters at 1012 14th Street, N.W. in Washington, D.C. NCA is composed of about 30 nationally known firms of engineers and builders which specialize in the design and construction of largescale industrial facilities throughout the United States and abroad. These projects include petroleum refineries, chemical and petrochemical plants, steel mills, power generating installations, atomic energy units, and missile bases.

Attached to this statement is a brochure describing NCA. Also attached is a folder listing its members, officers, and related information.

The association's interest: The association has a vital, historical, and continuing interest in legislation, such as the Davis-Bacon Act, which affects labor-management relations in the construction industry. When NCA was formed in 1948 shortly after World War II, one of its major interests and purposes was to improve and stabilize relationships between building and construction trades unions and construction employers, particularly those which are national rather than local contractors.

The distinction between "national" and "local" in this connection is significant. A local contractor usually confines himself to a single locality or area. He makes it his business to become intimately acquainted with the local labor market, local suppliers of material, and so forth. The national contractor faces completely different problems. A member company of NCA, for example, can be called upon by a client to design and erect a multimillion-dollar industrial complex in any section of the country, often on short notice.

Although, for any given project, he recruits his labor force locally in accordance with established practices in the industry, his real and long-term interest in labor relations is national rather than local. Because his operations in any specific locality are usually limited in time, a few months or a year or two, he does not as a rule participate in local collective bargaining over wage rates, fringe items such as health and welfare funds, apprenticeship training funds, vacation plans, pensions, and so forth.

To digress a minute from the statement, speaking of vacation plans, I would like to submit to the committee that because of the number of pool vacations, paid holidays, severance and similar benefit plans for construction workers is growing, an amendment to H.R. 9656 might be considered which would also include such plans as wages under Davis-Bacon, especially since they, too, along with pension, insurance, medical care, and training programs, are expressly recognized under Taft-Hartley as employee welfare programs to which employer payments are legitimate.

Mr. ROOSEVELT. Mr. Collins, could I interrupt you a moment? I am confused, because yesterday the Secretary of Labor told us that vacation plans were in effect in a different category and were already

included in the determination of the prevailing rate in view of the fact that they were paid at that time. Is that your knowledge? Mr. COLLINS. That is true, yes.

Mr. ROOSEVELT. That is why they are not included. Do you think it is necessary to include them?

Mr. COLLINS. If they are presently included, I cannot see any reason for it.

The national agreement: In order to operate nationally in an industry whose labor supply is essentially local and decentralized, new labor relations policies have been required. They were developed in part by the National Constructors Association.

A major element in this new approach in recent years has been the national labor agreement. It is a collective bargaining contract_between NCA or its member companies on one hand and a national or international building trades union on the other. Unlike most labormanagement contracts, the national agreement is concerned only indirectly with hourly wage rates and fringe matters; usually, the employer agrees to recognize and pay such rates and meet such conditions as may have been established through bona fide local collective bargaining in the locality of the work.

The national or international union, in return, agrees to assure the national contractor protection against interruption of work, even in the event of areawide strikes over economic contract issues. Both sides agree to settle grievances in accordance with preestablished procedures, without strikes or lockouts.

Development of fringes: When Davis-Bacon was enacted in the early thirties, and even during the forties when NCA was established, most of the so-called funded fringe items with which the proposed amendment to the act is concerned were unknown. Labor agreements in the industry during this period were concerned primarily with union recognition and union security, hourly wage rates, and grievance procedures.

Apprentice training, for example, was largely a local and often voluntary arrangement. Pension programs were unique, and vacation and health and welfare schemes were virtually nonexistent.

During the period roughly encompassed by the fifties, all this was changed. The package concept-meaning a combination of wage adjustments and fringes entered the jargon of collective bargaining in the industry.

National contractors were not immune to this change. Although they did not, as indicated earlier, engage extensively in local bargaining, they were made aware of fringes in the drafting of national agree

ments.

An illustration of this development concerns NCA and the United Association of Plumbers & Pipefitters. The general president of that union, the late Martin P. Durkin, who later became Secretary of Labor, made plain his belief that national contractors should help pay for the cost of training apprentices of the plumbing and pipefitting industry. The result was the international training fund, financed through contributions of national contractors, which provides financial support for worthwhile training programs throughout the country.

The public interest: Other examples could be cited, but they would be repetitious. The plain fact is that most construction contractors,

like employers in other industries, have recognized their responsibility to society in general, to the future, and to the care of those who, after years of hard work, join the ranks of the retired.

Recognition of this responsibility is a part of today's world. Member companies of the National Constructors Association accept this as a social and public responsibility and have agreed, at the bargaining table, to pay their share. They have obligated themselves not only to pay wage rates established by building trades in local contract negotiations but also to pay fringe items such as health and welfare fund payments, and so forth. These fringe items have become an increasingly important factor in the labor cost of a construction project. The other side: The nonunion or open shop contractor has no such obligation, contractually, to contribute to the health and welfare of his employees, or the training of replacements in the skilled construction forces of the country. He becomes, in a sense, a free rider.

As a result the public purpose of Davis-Bacon is vitiated, and the public policy is largely nullified.

This creates a situation in which a contractor operating under union agreements is being placed at an increasingly serious competitive disadvantage in bidding on Government construction projects. It was a situation of this kind which prompted enactment of Davis-Bacon initially.

In conclusion, enactment of the bill shall, in our opinion, contribute toward stabilizing the construction industry by removing competitive advantages or disadvantages between groups of construction contractors. It will also contribute to the public interest by promoting the continuance of apprenticeship training programs for the industry and help to maintain voluntary retirement and medical aid plans.

We urge your committee to take favorable action on H.R. 9656. Mr. ROOSEVELT. Mr. Collins, thank you very much for your statement and for the material which you have submitted.

I notice that you did not comment on the hours bill. Do you have any feelings about that?

Mr. COLLINS. The hours that we work are pretty well established in our agreements.

Mr. ROOSEVELT. Have you any objections to codifying this and simplifying the laws so that we make clear a 40-hour workweek is applicable?

Mr. COLLINS. None whatsoever.

Mr. ROOSEVELT. As I listened to your statement, your main contention would be that the contractors who now provide welfare and fringe benefits to the workers under the act are at a serious disadvantage as against contractors who do not provide these welfare benefits; so in essence we are penalizing those contractors who help their employees, and we create an unfair competitive advantage to one side as against the other. Is that correct?

Mr. COLLINS. Yes.

Mr. ROOSEVELT. Mr. Griffin.

Mr. GRIFFIN. Mr. Collins, are you familiar with the relationship of the Davis-Bacon Act to jurisdictional strikes at missile sites?

Mr. COLLINS. My particular company is not doing missile site work, but I believe Mr. Walling's company is doing some.

Mr. GRIFFIN. I think you have heard some of the questioning this morning. Do you agree that the Davis-Bacon Act does have a relationship to the jurisdictional strike situation at missile sites?

Mr. COLLINS. I am sorry that I did not hear too much of what preceded my appearance here.

Mr. GRIFFIN. I thought I was addressing my question to Mr. Walling.

Mr. WALLING. I did not hear the questioning either, Mr. Griffin, only a small part of it, but I do not see any particular relationship between the Davis-Bacon Act and jurisdictional disputes at missile bases.

Mr. GRIFFIN. When the Department of Labor makes a determination as to what is construction or alteration, is not this a factor in whether one union or another union—

Mr. WALLING. I am sorry. I misunderstood your question. I was thinking of the relationship between the building trades unions themselves. It certainly does have a very direct relationship between building trades unions and industrial unions.

Mr. GRIFFIN. Have you and your members had problems along this line?

Mr. WALLING. We have had some. We have not had as many as some of the other contractors on missile sites, but we have had some disputes along those lines, yes.

Mr. GRIFFIN. Mr. Collins

Mr. ROOSEVELT. Will you yield for one moment?

Mr. GRIFFIN. Yes.

Mr. ROOSEVELT. If there was no Davis-Bacon Act, would not these same disputes arise?

Mr. WALLING. They certainly would arise, in my opinion.

Mr. GRIFFIN. Mr. Collins, do you believe that Congress should pass a law requiring all employees in the building and construction industry to belong to labor unions affiliated with the Building & Trades Department of the AFL-CIO?

Mr. COLLINS. I do not believe they should pass a law in that nature; no, sir. We have elected to affiliate ourselves.

Mr. GRIFFIN. There should be freedom of choice among the majority of employees in a bargaining unit to decide whether they want to belong to a union?

Mr. COLLINS. Yes, sir.

Mr. GRIFFIN. What do you think about the point brought out by Mr. Goodell in questioning the previous witness: that a nonunion contractor would be paying the difference, or could be paying the difference, in cash? Does that concern you?

Mr. COLLINS. No. I think it would concern the men who are getting it, if they are not getting the benefit of these programs, if they are working for a nonunion contractor, they are not getting the benefit of the welfare plans that will provide for their family in case of their death, and for their old age.

Mr. GRIFFIN. Do you feel, then, that there is no basis for the assumption that in many cases these employees would prefer the payment of cash as was indicated? Because if they would prefer the payment of cash, this could create a problem, could it not?