the meeting was a free agent, free to do anything he wanted to do outside of that meeting.

Despite the assurances in that respect, the industry members refused to participate in a vote, and the result was the committee adjourned without any date for further meeting.

It is in, I suppose, a state of suspended animation right at the present time. I do not know whether it will meet again or not.

Senator TAFT. You may be entirely correct, Mr. Reuther, but I understood they did not refuse to vote; that they simply refused to agree that any committee action could be taken unless a majority of each one of the bodies, both labor and management, agreed on a proposition.

Mr. REUTHER, No.

Senator TAFT. You may be correct, but the impression I had was that they would not agree that there could be anything taken as committee action unless the industry members voted for it as well as the labor and public members. They were not willing, in other words, for a difference between labor and management to be determined by the public members, what was the consensus of opinion, so to speak. Maybe I am completely mistaken, but that is the impression I had.

Mr. REUTHER. I think that your definition of what took place there it not quite accurate. Actually, what was bothering the industry people was that they felt that here was a tripartite setup in which the labor and public people together could make a majority against them, and that even though it was understood that they were in no way bound by that majority decision, they felt their public position would be compromised if it came out of there that a majority had voted for something contrary to what they believed in.

We said, obviously when you get three parties to a meeting like that, you can always get-we said we were willing to vote even though we also ran the risk—and I am certain there would have been many issues upon which the industry and the public members might have outvoted the labor people.

I think that the mistake that was made there was when the industry people decided to act as a caucus group. I think that was a mistake, because the whole concept of the tripartite machinery has value only to the extent that you can break down the rigid groups that make up its membership. If everybody is going to act as a power bloc within the three-party setup, then you get nowhere.

Senator TAFT. Has anybody ever succeeded in preventing that in a tripartite group?

Mr. REUTHER. It has happend on a few rare occasions, Senator Taft, a few rare occasions. Obviously where the first meeting breaks down because one group is acting as a bloc, that sort of meeting has no possibility of making a contribution if it is going to function as a rigid bloc.

The CHAIRMAN. I talked to members on both sides, both the management and labor members, I was told that if they had left the professors out, the public, that management and labor could very well have gotten together and probably arrived at some recommendation. They said that the way the setup was, it was a three-ring circus; that labor argued its case to the public members, and management argued its case

to the public members, and that management was not willing to let the public group decide all the issues. They said, "Throw the jury out and we will get together very quickly."

Mr. REUTHER. I think it can be said in all good conscience that the industry people had less confidence in their arguments than the labor people. [Laughter.]

Senator NEELY. Did the President of the Secretary of Labor make any recommendations to the commission?

Mr. REUTHER. No; they did not. We were advised by Mr. Durkin that this meeting was called for the purpose of trying to explore the areas of possible agreement. We were given no recommendations. I personally think that the President and the Secretary of Labor both have a moral obligation to make recommendations on this, since they have indicated that they both believe that amendments ought to be made. I think that they have an obligation to make known what they think represents the kind of changes that they would ask for.

Senator NEELY. You and I are in complete agreement about that. The CHAIRMAN. I think that will undoubtedly be forthcoming. I have talked to both the President and Mr. Durkin about it. Mr. Durkin did not want to come in as first witness, although we invited him to. He wanted to keep the Government out in the beginning. We will have these preliminary hearings to secure the recommendations of management and labor, and then we will confer with the executive branch and let its representatives come in and make their suggestions.

The administration is not trying to put over a program. They want management and labor, appearing before our committee, to first give us their recommendations, and we will see what we can do with them. I think that is a reasonable position to take.

Senator NEELY. Mr. Chairman, I do not wish to argue with you. But, in my opinion, since a Republican Congress gave us the TaftHartley law, a Republican administration ought to recommend what should be done to it because the President has stated, in words or effect, that the law contained "union busting" provisions.

Senator TAFT. What is this about Republican administrations? I just want to call attention to the fact that this bill was passed by a Democratic House, by a majority of the Democratic Members in both Houses, during a Democratic administration.

Senator NEELY. It is true that we had a Democratic President who vetoed the bill, both the authors of which were distinguished Republicans, and it was a Republican Congress that passed the bill over the Democratic President's veto.

Mr. REUTHER. I do not want to intervene in this friendly argument, but I would like to say that we think there is enough bad about the law to go around between the Republicans and the Democrats, and you should not have a fight about it.

Senator NEELY. I want to add now-and I hope my eminent friend from Ohio will not object to this-that if he had been elected President last November, this committee would not be floundering without a recommendation from the President of the United States as to what ought to be done about the Taft-Hartley law.

The CHAIRMAN. You think he would have recommended repeal, I take it. [Laughter.]

Senator NEELY. I would not misrepresent the distinguished Senator from Ohio. In my opinion, he would not have recommended repeal. But I do believe that he would have sent us very concrete recommendations as to what he thinks should be done about amending the Taft-Hartley law.

The CHAIRMAN. Thank you very much, Mr. Reuther. We have enjoyed your testimony.

We will ask Mr. Goldberg if he will follow.

Senator TAFT. I want to say I am sorry I was not here earlier, but I have not even been to my office yet today.

Mr. REUTHER. Senator Smith explained that, and I understood why you could not make it.

TESTIMONY OF ARTHUR J. GOLDBERG, GENERAL COUNSEL, CONGRESS OF INDUSTRIAL ORGANIZATIONS

Mr. GOLDBERG. Mr. Chairman and gentlemen of the committee, I will not attempt at this late hour of the afternoon to read this lengthy statement that I have to present. I think I first ought to introduce myself. My name is Arthur J. Goldberg. I am, as you know, general counsel of the CIO.

Since some remarks have been made about various steel disputes I should also state that I am general counsel of the United Steel Workers of America.

I have two statements here. I would like to explain what they are and then I will attempt to review the statements as briefly as I can. I think that President Reuther of the CIO has given a very comprehensive statement of our overall position. It is not my purpose or intention to repeat in any his statement. I thought I could be most helpful to the committee in its work by giving a sectional analysis of the Taft-Hartley Act and by making very concrete suggestions as to proposals we have to make with respect to the statute.

I don't mean to indicate that I have the last word to say about any of these provisions. As has been apparent from Mr. Reuther's discussion and the very intelligent questions that have been asked by members of the committee, this is a very highly complicated field, and no one can purport to have the last word about any of the really substantial problems involved.

What I hope to do in the course of my presentation is to cast some light, to raise some problems, to suggest some prossible solutions, without indicating that these are the final solutions. After all, it is the ultimate responsibility of this committee and the House committee to formulate solutions. All we can do is try to be as helpful as we can to the committee in the formulation of those solutions. Mr. Chairman, the first statement I have to make is the larger statement of some 65 pages, which is not really 65 pages. We broke it down sometimes into half pages to segregate the sections. With the aid of your committee print, which the committee was kind enough to furnish me, I will go through the various sections and point out briefly some of our observations about these sections and some of our suggestions as to changes.

I will ask that this formal statement of mine, with your permission, Mr. Chairman, be incorporated into the record of these proceedings.

The CHAIRMAN. So ordered.

Mr. GOLDBERG. I have another statement, which is a supplementary statement which deals with various amendments which have been proposed by some of the Senators with respect to the provisions of the act. Unfortunately I was unable because of limitations of time to comment on all the amendments. However, I shall try to do so as far as I can recall all of the amendments orally, and I will be glad to respond to any questions that any Senator may have to make with respect to any particular amendment.

Mr. Chairman, with your permission I would like the supplemental statement which I have prepared to be incorporated into the record of these proceedings.

The CHAIRMAN. That will be incorporated also.

(The statements referred to follow:)

STATEMENT OF ARTHUR J. GOLDBERG, GENERAL COUNSEL, CONGRESS OF

INDUSTRIAL ORGANIZATIONS

My name is Arthur J. Goldberg. I am general counsel of the Congress of Industrial Organizations, and I appear here on its behalf.

Mr. Walter P. Reuther, president of the CIO, in his statement, has dealt with the general principles which we believe should form the basis of a fair and sound labor-management relations law. It is not my purpose to repeat what Mr. Reuther has said. Rather, I propose to make a specific, detailed, section-bysection analysis of the Taft-Hartley Act, and to present our concrete proposals for amendment of various sections of that law.

In the course of my presentation, I shall also attempt to analyze and to give our views with respect to proposed amendments to the Taft-Hartley Act, pending before this committee.

It is my hope that, by following this procedure, I can render constructive assistance to this committee in its work.

SECTION 2 (2). DEFINITION OF EMPLOYER

The Taft-Hartley Act made three changes in the Wagner Act's definition of employers who are subject to the act:

(a) It dropped the inclusion of persons acting "in the interest of" an employer and substituted for it persons acting "as an agent of" an employer.

(b) It excluded wholly owned Government corporations and Federal Reserve banks, and

(c) It excluded nonprofit hospitals.

A. Even today, 6 years after the Taft-Hartley Act became law over President Truman's veto, the full effect of the first of these changes is not clear. This, of course, is true of many of the other technical provisions which its authors wrote into the Taft-Hartley Act in order to obtain from Congress decisions favorable to employers which were unobtainable from the courts in the then-existing state of the law.

Under the Wagner Act, the Board required that persons acting in the interest of an employer have a substantive relationship with the employer in fact. It is difficult to see, therefore, why any change was required in this section. The intent of the authors of the change would seem to have been to grant to employers a larger area of exemption from responsibility for things said or done by their supervisory personnel or other persons or groups, such as citizens' committees, in some situations where employers would have been held responsible under the Wagner Act.

I am of the opinion that no larger exemption is justified, and, indeed, I am dubious that any has been granted.

I subscribe to the sound and realistic rule of responsibility in this field announced by the United States Supreme Court in International Association of Machinists v. NLRB (311 U. S. 72, 80):

"We are dealing here not with private rights (Amalgamated Utility Workers v. Consolidated Edison Co., 309 U. S. 261) nor with technical concepts pertinent to an employer's legal responsibility to third persons for acts of his servants, but

with a clear legislative policy to free the collective-bargaining process from all taint of an employer's compulsion, domination, or influence."

The change in the definition of employer responsibility made by the TaftHartley Act has muddied the legislative policy thus described. Whether its effects turn out to be far reaching or only minor, uncertainty has been introduced where certainty once prevailed, and employees can no longer rely as securely as formerly on the authority of the NLRB to keep the collective-bargaining process free from "all taint of an employer's compulsion, domination, or influence" (IAM v. NLRB, 311 U. S. 72, 80). For, as has often been pointed out, and as the Taft-Hartley Act itself recognizes by specifically exempting supervisors, in modern industrial concerns foremen and supervisors are management to the employees who work under them, technical common law rules of agency to the contrary notwithstanding.

I wish to add the further observation that perhaps an unintended consequence of this Taft-Hartley amendment is to invite unscrupulous employers to obstruct organization by devious methods of obtaining "outside" intervention against legitimate organizational activities of unions. Certainly, no one on this committee would welcome a repetition of the subterranean practices indulged in by many employers in the days prior to the Wagner Act, as documented by the hearings and reports of the La Follette subcommittee of this committee.

B. The second change in the definition of employer made by the Taft-Hartley Act was to exclude not only Government corporations to which the NLRB had never applied the Wagner Act, but also Federal Reserve banks.

The mere fact that Federal Reserve banks perform "a vital governmental function "is no reason for denying their employees who wish to join unions and bargain collectively through these unions protection in the selection of bargaining representatives and against employer unfair labor practices. Many private business concerns, particularly in a period of defense mobilization, perform functions surely as vital to the carrying out of important governmental functions as Federal Reserve banks.

Furthermore, the employees of Federal Reserve banks are not Government employees, any more than are the employees of other banking institutions. They are entitled to and should have the same protection of their right to organization for their economic betterment as other banking employees have.

C. The Taft-Hartley Act also changed the definition of "employer" in the Wagner Act to exclude nonprofit hospitals.

No reason for specifically exempting nonprofit hospitals was set forth in either the House or Senate committee reports on the Hartley or Taft bills, or in the conference committee report, although there are suggestions in the House report that the House committee believed that they are not engaged in commerce and should be subject to exclusive local jurisdiction.

Of course, if a hospital does not engage in activities that affect commerce, it is not subject to the act in any case, but if that is so no exemption is necessary. It is only on the assumption that their activities do affect commerce that a specific provision is needed in order to exempt nonprofit hospitals.

Again, however, if this assumption is accepted why should the employees of nonprofit hospitals, any more than those of corporation or association operating hospitals for profit, be denied the protection of the act in their efforts to improve their wages and working conditions through organization into unions and collective bargaining? Although recently there have been some improvements in employment conditions in hospitals, hospital employees are still notoriously underpaid and overworked. They are as much in need of governmental protection of the right of self-organization and collective bargaining as any employees now subject to the act.

SECTION 2 (3). DEFINITION OF EMPLOYEES

The definition of employees excludes agricultural laborers from the coverage of the act. In addition, a rider to the annual appropriations act for the NLRB prohibits the expenditure of funds for the processing of cases involving agricultural employees as defined in section 3 (f) of the Fair Labor Standards Act. There may be some justification for excluding the hired hand or the day laborer on the family farm. There is no justification in sound public policy for excluding the employees of the huge corporation farm.

The principle of enacting legislation by riders to appropriations bills is not sound.