EXHIBIT 4 [From the Arkansas Gazette, Monday, June 21, 1965] HOSPITAL LAYOFFS SHOW NEED FOR JOBLESS PLAN, ALLEN SAYS The executive secretary of the Arkansas Council of Churches said Sunday that interviews with several persons who were dismissed recently from Arkansas Baptist Hospital underscored a need for unemployment compensation programs at hospitals to protect employes. Rev. Sam J. Allen said he interviewed six employes who were laid off work at Baptist Hospital in January and April as part of the Council's program against poverty and found "a plight of human misery and despair" and "impending poverty." "One [employee] said that she went into a state of despair and depression after her layoff because she had given many years of her life to the hospital and loved the work of humanitarian service and was now over the age of 45, which is making it impossible for her to find other employment," Mr. Allen said in a statement, which did not mention the hospital by name. He said the six he interviewed reported that others who were laid off at the same time were facing a similar situation. About 75 of the nearly 1,000 employes at Baptist Hospital have been laid off during an efficiency study conducted by a management consultant team to streamline the operation of the Hospital and reduce costs. Most of the layoffs have been in the housekeeping, kitchen and laundry departments and reportedly have lowered morale among the Hospital personnel. About five persons have been laid off in a similar study at St. Vincent Infirmary. Neither hospital has made layoffs among technical and professional workers. None of those laid off at either hospital may draw unemployment pay because neither hospital has an unemployment compensation program. Hospitals, as charitable institutions, are not required by law to participate in the unemployment insurance program and generally do not. A hospital administrator said this was so because usually 70 per cent of a hospital's income goes for payrolls and because hospitals generally have excellent fringe benefit programs. "Management should be encouraged always in its attempt to streamline operations and cut costs," Mr. Allen said, “but in doing so it should make every possible effort to insure that layoffs are made fairly and that those to be laid off will not be put out on the street with no place to go for protection from poverty." He said if an unemployment compensation program were in effect, it would tide dismissed employes over until they find another job. Mr. Allen said the Missouri Pacific Hospital "has had no serious problems in making employe adjustments in streamlining and updating their operations and in spite of some layoffs employe morale remained high." He said he called Carl E. Reis of St. Louis, executive secretary of the Missouri Pacific hospital system, to find out why. Reis told him, Mr. Allen said, that the main reason for Missouri Pacific's success was the work done by the Hospital, Hotel, Motel and Restaurant Workers Union, which represents the employes there, to shift employes fairly and according to seniority to other parts of the hospital, to help those whose jobs were eliminated to find temporary employment outside the hospital before they were laid off and to give them the right of resuming work at the hospital as soon as a new job opening came. Earl F. Yeargan, international representative of the union, said last week that many of the employes at Baptist Hospital had come to him and that he had begun a union campaign at the Hospital. The Missouri Pacific Hospital is the only one represented by his union in Arkansas. The Missouri Pacific Hospital also doesn't have an unemployment compensation program, Yeargan said. "Let the hospitals streamline and cut costs wherever this can be done, but let them also express their humanitarianism to their employes as well as the patients," Mr. Allen said. He said that several former employes at the hospitals had given from 12 to 18 years of service to the hospital and expressed disbelief when their jobs were eliminated with no advance notice. Two had received five-year pins and reported that they were not given seniority consideration, he said. ACTORS' EQUITY ASSOCIATION, New York, N.Y., July 21, 1966. Hon. HERMAN E. TALMADGE, MY DEAR SENATOR TALMADGE: During the course of my appearance before the Senate Finance Committee on Monday, July 18, 1966 in connection with H.R. 15119, you raised a question as to the possibility of an unemployed worker claiming in more than one State if the amendment suggested by Actors' Equity Association were incorporated in the bill. I am most happy to clarify this as follows: When a claim is filed in which covered employment in more than one State is cited, the State in which claim is filed-which will become the "paying" State if the claim is validated-must contact all of the States in which employment occurred and request a transfer of wage credits. Each participating State processes such request in accordance with its own individual statutes and regulations and transfers wage credits only when earnings and coverage bave been verified, and, under present law, when the employment falls within the individual base period in such State. It may take as many as six to eight weeks for the processing to be completed, during which time the claimant must continue to meet reporting requirements in the State in which he files. Once any wage credit is transferred to the paying State and a claim validated, the employer's account is charged in accordance with the individual State's procedures, and the employment cannot legally be cited on a further claim. Accordingly, assuming it were physically possible for a claimant to file in a second State while still meeting reporting requirements in the first, it won'd be impossible for him to validate his claim as the wage credits would no longer be available. The amendment which Actors' Equity Association suggests would require merely that the base period criteria applied in transferring any unused wage credits be that of the paying rather than the transferring States, and that all States participate. It would not in any way alter or seek to alter any other criteria applied by the individual States or the general procedures now followed in processing combined and extended claims and transferring wage credits. Once again, I wish to thank you for all the courtesies extended to us, and respectfully request that you have this letter inserted in the record of the committee hearing together with my testimony. Sincerely yours, HELENE TETRAULT, GENERAL ELECTRIC CO.. New York, N.Y., July 26, 1966. Hon. RUSSELL B. LONG, Senate Finance Committee, U.S. Senate, DEAR SENATOR LONG: On behalf of the General Electric Company, I should like to outline for the record our comments on H.R. 15119 "Unemployment Insurance Amendments of 1966"-now before your Committee. Additionally, and for the reasons to be explained, General Electric wishes to endorse H.R. 15119 and to urge that your Committee report it favorably to the Senate for early enactment. At the outset, you should know that the General Electric Company continues to support the present, soundly-conceived Federal-State unemployment compen sation system. Within the framework of that system, we have made suggestions as to how it could be improved to work better.1 H.R. 15119, we believe, contains many positive steps, improving the unemployment compensation system. Specifically, we commend for your approval the concept found in H.R. 15119, which extends the normal duration of state benefits from twenty-six weeks to thirty-nine weeks only during periods of recession as determined within each state. An extended duration system, which operates only when jobs are more difficult to find, makes far greater sense-both economically and sociallythan any permanent extension of benefits, expending valuable reserve funds during better times when jobs are easier to find. We would hope that Congress, at some future date would recognize the merits of financing this program 100 percent within the existing state arrangements in place of the shared 50 percent federal-50 percent state financing contained in H.R. 15119. We also commend for your approval the provisions of H.R. 15119, which broaden the coverage of unemployment compensation. It is desirable and appropriate to cover bona fide employers who have one or more employeesnot four or more as at present under Federal law. The bill before your Committee deserves special merit for what it does not contain, as well as for what it contains. Significantly, as a substitute or alternative to H.R. 8282, the bill fails to incorporate, and thus wisely rejects, the more questionable features contained in H.R. 8282. In this connection, we would hope that you would concur in maintaining the deletion of all those sections of H.R. 8282, which would have, in effect, abolished the sound experience-rating provisions of state laws. Experience-rating is a keystone of the system, rewarding employers with lower tax rates if they stabilize employment, as well as equitably allocating the costs of the program. Additionally, we trust that you will share the opinion of the bipartisan sponsors of the H.R. 15119-that the states merit the continued confidence that they can keep their benefit protection up to date without the imposition of Federal benefit standards. As noted in our earlier testimony, General Electric supports, within the limits of a public program, the 50 percent wagereplacement concept. It supports as well the general concept that the state maximum weekly benefits should be adjusted periodically by the states, so that at least the majority of claimants can receive 50 percent of their wages. Indeed, the record still clearly demonstrates that the states, by and large, have discharged reasonably well their responsibility here, even though in some states further adjustment is appropriate and is now under current consideration. Furthermore, we can see no need or justification for any plan to subsidize with Federal funds those states meeting suggested Federal benefit levels. This would be the same as imposing Federal benefit standards under another name and could only have a harmful effect upon the progress now being made at the state level. There has been dramatic improvement in state benefit protection over the past few years. It is incontrovertible that the current average weekly benefit check will buy over 54 percent more goods and services-measured in constant dollars that its 1939 counterpart. That progress should not be hampered by Federal "standards." In connection with this subject, we are still somewhat concerned that the record made in the House did not, in our opinion, adequately reflect the need to obtain better data as to how the state system is operating-particularly as to the extent that actual beneficiaries receive 50 percent of their normal wages in benefits. While the best data available generally indicates that at least a majority of beneficiaries are receiving at least 50 percent of their wages, this point can and should be verified directly. Perhaps your Committee may desire to explore with the Department of Labor and the state agencies the desirability of obtaining more significant and specific data in this vital area. In conclusion, General Electric believes that H.R. 15119 makes a positive contribution to the continuation of a sound and workable unemployment compensation system, not only for what it contains, but also for what it rejects. It merits your support, and we are pleased to support its enactment. Sincerely, E. S. WILLIS, Manager. 1 Most recently see General Electric testimony-August 18, 1965-pages 943-968 of the House Hearings on H.R. 8282. WHIRLPOOL CORP. STATEMENT ON UNEMPLOYMENT COMPENSATION BILL Whirlpool Corporation supports the Federal-State Unemployment Compensation System as it exists today-designed to financially assist the worker who becomes jobless through no fault of his own. This assistance should be temporary until new employment is obtained. The current Unemployment Compensation System continues to encourage employers to stabilize employment. Whirlpool's employment records at its major facilities in Michigan, Minnesota, Indiana, and Ohio are testimony to the effectiveness of the present system. A prime reason for our careful planning of jobstabilizing measures is due to the financial incentives inspired by the present Unemployment Compensation System. These job-stabilizing measures generally affect as many as 1,000 employees a year. One division has not had a layoff in six years; another division in nearly three years. Another division reduced layoffs from about 50% in 1957 to about 6.5% in 1961, and since 1964 there have been no layoffs. Meanwhile, still another manufacturing division reduced layoffs from 13.2% in 1961 to 4.9% in 1965. As time progresses, revisions are necessary to keep programs of social legislation-such as the Federal-State Unemployment Compensation System-in tune with economic progress and modern needs. H.R. 15119 supplies needed improvements to the present Unemployment Compensation System. In general, Whirlpool endorses and urges support of H.R. 15119, with only limited reservations. Whirlpool agrees with these provisions of H.R. 15119: 1. Experience Rating System is retained, thus encouraging employers to stabilize employment and reduce layoffs. 2. The net Federal unemployment tax rate increase of .2% is adequate to meet present and anticipated expenses. 3. Eligibility standards retain reasonable individual incentives. 4. The Judicial Review Clause would give a State a justifiable recourse to appeal the Secretary of Labor's decision regarding its conformity to Federal law. 5. The Unemployment Compensation program continues to be administered by the States, thus permitting each State to apply its experience to best meet its individual needs whether it be an agricultural economy or an industrial economy with varying work forces, costs-of-living, seasonal productivity cycles, income levels, etc. Whirlpool continues to maintain that the Unemployment Compensation System could be more fairly improved if the tax rate-not the tax base-were to be increased or decreased according to the revenue needed to support the program. Increased UC tax rates would mean that employers with high layoff records would contribute a fairer amount. Since a considerable number of employers pay employees less than the proposed taxable wage base, Whirlpool therefore does not endorse any increase of taxable wage base which would add unnecessary financial burdens on, or discriminate against, employers who pay higher wages. CONCLUSION In general. Whirlpool endorses and urges support of H.R. 15119, with only limited reservations. In reference to attempts to federalize the UC System, Whirlpool strongly opposes any consideration of S. 1991 which embodies all objectionable features of the former proposal known as H.R. 8282. A. J. TAKACS. Hon. RUSSELL B. LONG, RESEARCH & NEGOTIATING SERVICE, Chairman, Committee on Finance, SIR: I am writing at the behest of Mr. Richard Miller, Secretary Treasurer of the Greater Louisville Labor Council AFL-CIO. Will you please include the following comments on S. 1991 the Unemployment Insurance reform bill, in the printed record of your committee hearings: It is little realized that the present Federal Social Security law and regulations enabling the wide divergence among the fifty, separate state Unemployment Insurance programs is analagous to, and has the same impact as allowing the several states to enact so-called "right to work" legislation. For under the present federal standards are built-in inducements which encourage a state to enact and promulgate unemployment insurance programs with limited coverage, difficult eligibility requirements and low benefits. And such states advertise their low standards-a promise of a lower cost of doing business-as an inducement to attract new industry. Sanction for this unfair wage competition is found in the federal standards allowing for experience ratings. That is, the rate of annual insurance premiums paid into the state unemployment insurance fund is determined by the Employer's experience-layoffs; terminations; quits; etc.—with his workforce. Therefore, an Employer is encouraged to challenge, and try to limit the number of his former employees trying to exercise their right to unemployment insurance benefits, regardless of the merits of the particular employment separation. It might be conceded that the Employer has the right to "police" a program for which he pays most of the cost, but there is often the further advantage in that unfair rules and regulations require the state agency administering the program to act as yet another agent of the Employer. Of course, S. 1991 does not eliminate the experience rating, but it does allow the individual states to correct the matter if they wish-a small step in the right direction. Further, the bill establishes uniform disqualification penalties allowing a state to withhold benefits up to six weeks instead of indefinitely as is the present case in the low standards states. And another provision in the measure which would also tend to eliminate unfair wage competition is the gradual raising of benefits until the weekly amount is equal to one-half the worker's former weekly wage. Enough cannot be said of the present inadequacy of the benefit payment, but what is of equal importance is the provision to include additional workers under the program, many of whom are employed in the vital hospital and medical care industry, and other service trades. Thank you for your thoughtful consideration of this testimony. Very truly yours, RESEARCH & NEGOTIATING SERVICE, U.S. SENATE, COMMITTEE ON COMMERCE, Washington, D.C., July 26, 1966. Hon. RUSSELL B. LONG, Chairman, Committee on Finance, U.S. Senate, Washington, D.C. DEAR MR. CHAIRMAN: Enclosed is a copy of a letter I have received from Governor William Egan analyzing the impact of H.R. 15119 on the state of Alaska. I would appreciate your making this letter a part of the hearing record. Sincerely yours, E. L. BARTLETT. STATE OF ALASKA. OFFICE OF THE GOVERNOR, Juneau, Alaska, July 19, 1966. Hon. E. L. BARTLETT, U.S. Senate, Senate Office Building, DEAR BOB: We have completed our preliminary analysis of HR 15119 relating to unemployment compensation. Although the federal standards which would have resulted in large increases in our benefit costs have been removed from the revised version of the original bill, the prohibition against payment of reduced benefits to interstate claimants remains. As you may know, Alaska imposes an interstate reduction of benefits in order to maintain some semblance of control over the migratory nature of our seasonal work force, particularly in the food processing and logging and lumbering in |