main concern is that this wording not only includes new construction projects, but can and may well include any work done at any business location in the United States. If that is the intent, every business in the country regardless of size could well be affected by the enactment of this legislation. If a labor dispute arises between an employer and a labor organization and the labor organization refuses to perform services for that contractor, this is certainly a primary dispute. However, since the dispute could well occur at a location, such as we have previously mentioned, if the labor organization decided to use pickets to press their demands upon their employer at the construction or alterations site, neutral employees immediately become involved, unless there is some clear indication in the law that such picketing will not be permitted.

It is our understanding that the situation referred to in H.R. 9070 is not prohibited by present legislation. To be specific, the bill states, "any strike or refusal to perform services ** and directed at any of several employers who are engaged in the construction industry * * *," shall not be unlawful. Under our present law, the strike is not prohibited. Labor organizations are free to withhold their services. What is prohibited and what constitutes the primary concern of our association is the picketing which invariably arises in strike situations of this kind. The picketing is presently prohibited for a very simple reason: to allow it would create a situation whereby literally thousands of neutral disinterested employees become involved in labor disputes in which they have no direct concern.

What we are saying here is that when the law permits a strike it does not thereby necessarily allow every possible means available to be used by the parties involved in the labor dispute. The public interest has been and must continue to be recognized as paramount in importance. We know that you will continue to consider it as such. We thank you on behalf of the association and our committee for this opportunity.

STATEMENT OF FRANCIS MARION, SPOKESMAN for DANIEL CONSTRUCTION CO., INC.

My name is Francis Marion and I am an attorney and partner in the firm of Haynsworth, Perry, Bryant, Marion & Johnstone, Greenville, S.C. Our firm is general counsel for Daniel Construction Co., whose headquarters are in Greenville, S.C., with additional offices in Atlanta, Ga.; Birmingham, Ala.; Jacksonville, Fla.; Richmond, Va.; and a sales office in New York City.

In making this statement, I wish to make it clear that I am not primarily a labor attorney. I am engaged in the general, civil practice of the law and do not devote my sole time to labor matters, although in the general handling of the business of Daniel Construction Co. as well as other clients, I do handle problems connected with its employees.

I am informed that certain proponents of House bill 9070, and similar bills, contend that the bill is absolutely necessary to protect union conditions and standards in the construction field, and that a greater degree of harmony, order, and peace would be the result of the passage of the bill. We could not disagree more emphatically.

I am informed by Daniel Construction Co. that it presently employs approximately 7,000 workers scattered on construction jobs throughout the South and that in 1959 it was rated as the sixth largest construction company in the United States. I point up this fact to emphasize that Daniel Construction Co. is a large company, yet does not have labor difficulties. One would expect with the far-flung operations of this company a myriad of labor problems. However, to the contrary, I believe that anyone who knows the operation of Daniel Construction Co. can vouch for the fact that its labor relations are excellent. Of course, our opponents with the labor unions might disagree because Daniel construction Co. is not unionized.

Among its 7,000 employees there are undoubtedly thousands who belong to labor unions, but Daniel Construction Co., I am informed by its officials, always employ its men on the basis of merit, irrespective of race, color, creed or personal leanings for or against a union. I am further informed by Daniel Construction Co. that its wage scale is among the highest everywhere it transacts business. Why then is it necessary to pass a bill that we submit will create chaos and pandemonium in the construction field.

Every man should have a right to belong or not to belong to a labor union as he sees fit, but this bill would have the effect of attempting to unionize the entire construction industry regardless of the individual worker's feeling. Our present laws, it appears to me, are completely adequate. This is exemplified by the fact that Daniel Construction Co., with its vast number of employees, has operated in an air of peace and tranquility.

If the employees desire to belong to a labor union they are free to do so, and if they desire to have a bargaining agent they have their freedom of choice to do so. We ask then the rhetorical question of why is it necessary to pass a bill that obviously disregards the rights of the larger percentage of workers on the job who probably do not belong to a union. These employees are entitled to the same amount of protection to which the union members are entitled.

I submit that the enactment of this proposed bill would bring about work stoppages where there is no dispute between the principal employer and its employees. As it has been testified to by many witnesses far more experienced than I in this field, the construction industry is a completely different type industry from that of the average operation of a mill where the employees are working for one employer.

For instance, on Daniel Construction Co.'s jobs there are many subcontractors and suppliers. In fact, on large jobs I would imagine the subcontractors and the suppliers would run into hundreds. You, therefore, have not one employer, but many, many employers, all working on the same job site.

An example of what I would envision by the passage of this bill could be illustrated perhaps by a factual situation such as this:

A steel company that fabricates and sends to a construction job certain type steel for erection is nonunionized. Request for proposals on steel are sent by the construction company to a number of different companies. Certainly, the construction company could not be called on to check whether the bidding companies' employees are unionized or not. On the basis of the bids received, the nonunion steel fabricator is awarded the contract and the steel is shipped to the job to be erected by still another subcontractor.

The steel erectors on the job, which is a highly specialized field, are primarily unionized. The union wishes to organize the steel fabricating company so in order to bring pressure upon the steel fabricating company, puts a picket on the construction job. The steel erectors will not cross the picket line, therefore, the steel cannot be put in place. The bricklayers and other crafts are thrown out of work, and ultimately the entire job because of the lack of steel.

In that hypothetical situation there would be no dispute between the principal contractor and any of its employees. As a matter of fact, there would be no dispute between the steel erectors as far as the job itself was concerned.

The union is amply protected under the present law by direct picketing of the steel fabricating company's plant, but under the terms of this act could elect to shut down a complete construction job at a tremendous cost to the construction company, and a tremendous loss of wages to the individual employees of the construction company who are the innocent victims. I again pose the rhetorical question, why is this necessary?

Another factual situation I could envision is where an owner or an architect designated a certain type product, for purpose of illustration, an electrical fixture. Suppose that at the time, the electrical manufacturing company was involved in a disagreement with a labor union and in order for the labor union to further its ends with the electrical manufacturer, it placed a picket on the construction job where the electrical fixtures were to be used. There is certainly no labor dispute between the contractor and its employees. The contractor had no control over the type fixtures that were to be used, since they were designated by the owner or the owner's architect.

If a picket were placed on the job, the unionized electricians would not cross the picket line. This, in turn, would stop other allied work on the job which, in turn, could ultimately shut the whole job down. The contractor and the contractor's employees would be the innocent victims of such a hypothetical situation. It is obvious that the only purpose of the passage of the H.R. 9070 would be to force the electrical supplier to accede to the union demands, however unreasonable they might be.

I reiterate that every worker of Daniel Construction Co. or any other construction company should have the right to choose whether he wishes to be a member of a labor union or not. The great majority of employees of Daniel Construction Co. are not unionized although as it is heretofore stated, there are

probably thousands that are unionized. Why should the minority control the majority? This is abhorrent to every fundamental precept of our American constitutional way of life.

Apparently the real purpose of this amendment is simply to unionize the entire construction industry irrespective of the desires, wishes, or rights of the individual employees. If the ultimate goal is the unionization of the construction industry, which apparently it is from the import of this bill, then the next step would be the complete unionization of every manufacturing plant in this country. The unionization would be accomplished not by the majority will or vote of the employees in the units involved, but could be accomplished by a very small minority group.

I realize that this might seem farfetched, but I submit on a close examination of the import of this bill that the conclusion is inescapable. Let us again take a hypothetical textile plant which overwhelmingly wishes to be nonunionized. This is an expression of the majority of its employees which should be honored under our system of government.

This same textile plant needs repairs or construction work done in its mill. It calls a local contractor to send out its employees to do the necessary construction work. If all of the construction industry is unionized, the union members simply could refuse to do the necessary construction work to the nonunion textile plant. It might be said then, why does not the textile plant simply do its own work. The answer, of course, is obvious as it is absolutely necessary for mills to have repair and maintenance work done on its electrical system, its air conditioning, its heating, its boilers, etc., regularly which cannot be done by its regular mill employees. Another pressure is then exerted on this textile plant to become a union plant in order for its actual survival.

While I realize it is the desire of the union to accomplish the end of having every employee unionized, which is its prerogative, by the same token it is the prerogative of the employees who do not wish to belong to a union to have their rights protected. Under a system of free election, the individual should be able to make his choice.

I understand that there have been statements made that this bill is simply a technical amendment of no great import. To this argument of the proponents of the bill, we disagree most emphatically. This is an extremely far-reaching amendment, the apparent purpose of which is to completely unionize the construction industry which, in turn, would bring pressures to bear against other integral and allied industries.

In conclusion, I cannot too earnestly submit on behalf of our client, Daniel Construction Co., that the proposed bill, H.R. 9070 and similar bills would create chaos and confusion in the construction industry with far-reaching effects that would extend well beyond the confines of the simple erection of buildings. I most earnestly urge that such unreasonable legislation of this type not be forced upon the construction industry, which industry is so vital to the welfare and actual survival of our great Nation.

I appreciate the courtesies of this subcommittee in allowing me on behalf of Daniel Construction Co., to give our views on this bill.

STATEMENT OF HON. HENRY S. REUSS, A REPRESENTATIVE IN CONGRESS FROM THE

STATE OF WISCONSIN

Mr. Chairman, I am very grateful for this opportunity to express my views in support of H.R. 9373, introduced by me, and also in support of related bills on which your subcommittee is now holding hearings.

These bills have the common purpose of correcting a long standing inequity of the Taft-Hartley Act, contained in section 8(b)(4) of the National Labor Relations Act, as amended. Among other things, this section prohibits building tradesmen from respecting a picket established at a construction job site advising them that nonunion workers are being employed by others on the same job. The specific purpose is to repeal this prohibition, thereby overruling an unfortunate decision of the National Labor Relations Board, affirmed by the Supreme Court of the United States in what is known as the case of Denver Building and Construction Trades Council (341 U.S. 675 (1951). First, I would like to explain some of the background and the realities of the construction industry which prompted me to introduce this proposal.

Buildings or projects are rarely designed and built by one firm or company. Instead they are usually the products of the combined efforts of many firms or builders who may or may not have a direct contractual relationship with each other. Each one of these building firms undertakes a special part of the construction.

For example, there may be one contractor for excavation and for concrete work, or a general contractor for erecting the basic foundation and frame of the construction. Brick, tile, siding, or masonry may be separately contracted or subcontracted. All electrical work is usually separately contracted or subcontracted. So is all plumbing, heating, and air conditioning. Sprinkler systems are installed by another group of contractors. Frequently lathing, plastering, roofing, painting, sheet metal work and other similar functions, contributing to the completed project, may be performed by separate contractors.

All of these contractors must work together as a team. Careful coordination is essential to success. Either the owner or architect-engineer or the general contractor must weld these contractors and their workers together into one unified group. These circumstances create a close relationship between contractors. Indeed, I'm told it is advisable for each contractor to know as much as possible about the other contractors who may be chosen to perform some other phase of the work on the same construction project, because each can effect the ability of the other to perform. It is important, for example, for each contractor to be familiar with the methods of operation of the other contractors, including their ability to perform, their financial solvency, the nature and efficiency of their workmen and the source of their labor supply. Where a general contractor and a subcontracting system are used, it also becomes important for the owner or the architect-engineer to know in advance the identity of each subcontractor whom the general or prime contractor is going to use. Frequently the owner or architect-engineer requires the general contractor to list his subcontractors when he submits his bid. Frequently it is specified that the contractor cannot change subcontractors without approval.

For these various reasons it cannot be truthfully said that the contractors on the same construction project are strangers to each other or are "neutral" or "innocent" third parties so far as labor policies and industrial relations are concerned. To the contrary, it is crucially important for every contractor to know whether or not the other contractors on the job secure their workmen pursuant to and in accordance with a collective bargaining agreement between the contractor and a building trades union. The existence or absence of such an agree ment may make all the difference between harmonious and stormy industrial relations in the course of contract performance. It is the contractor's business, therefore, to ascertain the nature of working conditions which will prevail at the job site and the risk of misestimating these working conditions is one of the normal and accepted business risks of the construction industry.

Despite the very close relationships between contractors and between workers on construction projects, nevertheless, the recognized legal differences persist. Each contractor is a separate and independent entity. Each is a separate and independent employer of his own labor. Workmen jointly engaged on the same project at the same time may be employed by as many as a dozen separate and distinct but functionally closely related employers. These are, as Mr. Justice William O. Douglas so aptly describes them in his dissent in the Denver case, supra, "fortuitous business arrangements that have no significance so far as the evils of the secondary boycott are concerned."

Yet they do have significance so far as section 8(b)(4)(B) of the National Labor Relations Act, as most recently amended, is concerned. This section makes it an unfair labor practice for a labor union, among other things, to induce employees to refuse to work with an object of forcing one contractor or employer to cease doing business with another. A strike against a union contractor which protests employment of nonunion men by another contractor on the job would, according to the Denver case, violate section 8(b) (4) (B).

As pointed out in the dissent in the Denver case, "the picketing would undoubtedly have been legal if there had been no subcontractor involved-if the general contractor had put union men on the job. The presence of the subcontractor does not alter one whit the realities of the situation; the protest of the union is precisely the same."

While I understand the new amendments to the National Labor Relations Act contained in the Labor-Management Reporting and Disclosure Act of 1959 provide some new restrictions on picketing, nevertheless, it is still the law that

neither these amendments nor the Taft-Hartley Act itself forbid the right to strike in a primary direct dispute except in expressly specified instances, such as national emergency disputes. In fact section 13 of the National Labor Relations Act expressly declares that "Nothing in this Act, except as specifically provided for herein, shall be construed so as either to interfere with or impede or diminish in any way the right to strike, or to affect the limitations or qualifications on that right."

Thus, construction workers do not enjoy the same rights and priviliges conferred upon factory workers. Due to technical contractual relationships on the construction job site, given express recognition in the Denver case, these workers are effectively denied the right to strike to secure union conditions even though this right is effectively preserved for factory workers by section 13, as quoted above.

Briefly, H.R. 9373 would, in effect, overrule the Denver case by providing an exception to section 8(b) (4) (B) for construction work at a common situs. The amendment legalizes any strike or refusal to work directed toward any of the contractors engaged in operations at the construction site wherever a labor dispute on working conditions exists and the terms of an applicable collective bargaining agreement are not being violated.

The simple purpose of this amendment has met with general approval. In fact the exact terms of this bill have been endorsed by the leadership on both sides of the aisle in both Houses of Congress. The White House has repeatedly requested this amendment, and early action this session has been promised by those who are in a position to make good on their promises. All of these facts have been very ably presented to this subcommittee in great detail. They form a vital part of the record in these hearings and it would serve no useful purpose for me to review them once more in detail at this time.

In requesting this subcommittee to act promptly and favorably on this measure, I wish to make one closing observation on the Denver case, as viewed by the dissenting justices. They declared, quite rightly in that case, that "the employment of union and nonunion men on the same job is a basic protest in trade union history. That was the protest here. The union was not out to destroy the contractor because of his antiunion attitude. The union was not pursuing the contractor to other jobs. All the union asked was that union men not be compelled to work alongside nonunion men on the same job."

I respectfully submit that we should permanently restore this traditional right of building trdesmen by passing H.R. 9373 at the earliest possible date. To this end, it is my hope that the subcommittee will speed this bill on its way to the floor of the House for a vote.

BOSTON, MASS., February 19, 1960.

HOUSE EDUCATION AND LABOR COMMITTEE,
Subcommittee for Labor-Management Relations,

Old House Office Building, Washington, D.C.:

The Smaller Business Association of New England, Inc., wishes to be recorded at the current hearings as opposed to any weakening of present bans on secondary boycotts and as favoring complete outlawing of any and all types of secondary boycott.

LAURENCE F. BROOKS,

Executive Vice President, Smaller Business Association of New England.

Hon. CARL D. PERKINS,

Chairman, Subcommittee on Labor-Management Relations,
House of Representatives, Washington, D.C.

DEAR MR. CHAIRMAN: Mr. E. B. Germany, president, Lone Star Steel Co., which is located in the congressional district I have the honor to represent, who is a very fine, patriotic citizen and whose views, I believe, are entitled to consideration, has wired me as follows:

"H.R. 9070 will be heard by the Labor Subcommittee tomorrow. While this legislation is aimed directly at the municipal contractors, it has an equally direct effect upon Lone Star since we are a direct supplier of cast iron pressure pipe, steel line pipe, and reinforcing rods to members of the contractors association. Principles expressed in the proposed bill are diametrically opposed to the fundamental principles upon which this country was made great and its passage