procedures, or otherwise, because its officers have not properly served the interests of those members.

And, in addition the administration bill is faulty because it

(1) Brings political partisanship into the qualification tests for appointees to the NLRB;

(2) Seeks to widen the no man's land by turning jurisdiction over to State agencies and courts, without the slightest regard for whether the States are capable and responsible in this field;

(3) Provides a useless and ineffective prehiring union security agreement in the building and construction industry; and

(4) Extends the useless and nonsensical non-Communist affidavit provision to employers as well.

Finally, Mr. Chairman, the administration bill, in sections 503 and 504, seeks to impose new restrictions on secondary boycotts and seeks to prohibit organizational picketing as an unfair labor practice. The merit or lack of merit of these proposals is discussed in detail in appendix A to our statement.

Without regard to the substance of these points, I contend they are wholly without relation to the problem of corruption and are evidence of the antiunion character of the bill.

Let me point out that these proposals deal with some of the most conflicting and controversial problems in the entire field of labormanagement relations. Their inclusion in H.R. 3540 is to us clear evidence that the administration is engaged in deliberate effort to so befog the issues involved in dealing with labor-management reform legislation as to make it extremely difficult for Congress to enact fair, workable, and effective legislation.

These items distinctly belong-if they belong at all-in the kind of thoughtful, mature consideration of Taft-Hartley of which I have already spoken.

Let me add that there are two points in the administration bill which we support, but which are stated equally as well or better in other bills before this committee, the repeal of the prohibition of voting by economic strikers and the permission to the NLRB to hold prehearing elections where no substantial issue is involved.

The Barden bill: The final measure to which I propose to direct my attention, Mr. Chairman, is H.R. 4473, introduced by the Chairman of the House Committee on Education and Labor. Mr. Barden's bill contains 88 pages and bears the title "Labor Bill of Rights Act of 1959."

We find this bill objectionable for nearly all the reasons which I cited as objections to the administration bill.

In my supplement, Mr. Chairman, I have indicated those unique features to which we object in addition to the objections we raised to the administration bill. Suffice it to say, Mr. Chairman, that this is not the path toward labor-management reform and that no one who understood the facts of life in labor-management relations would seriously suggest it.

Before concluding, Mr. Chairman, I want to reiterate the opposition of the American trade union movement as represented by the American Federation of Labor and Congress of Industrial Organizations to corruption and racketeering any place, any time, anywhere. We are dedicated to the eradication of every vestige of corruption and racketeering in the labor-management field.

I said to the Senate committee last May, and I now repeat:

It is our sincere belief that trade unions exist solely as instruments to serve the working men and women of this Nation. They cannot serve them unless they are free, clean, and democratic.

We support Federal legislation designed to achieve this goal.

We will fight with equal vigor any attempt to destroy or weaken the trade union movement in its legitimate functions or to weaken and destroy the process of free collective bargaining.

We believe that prompt action will serve not only the cause of the trade union movement and of labor-management relations, but the general welfare as well.

On behalf of the American Federation of Labor and Congress of Industrial Organizations, I thank you for this opportunity of presenting our views and for including my supplemental statement in the committee's record.

(The following documents were submitted with Mr. Meany's statement :)

STATEMENT OF GEORGE MEANY, PRESIDENT, AMERICAN FEDERATION OF LABOR AND CONGRESS OF INDUSTRIAL ORGANIZATIONS

Mr. Chairman, the material which follows is a detailed comment of the several bills on labor-management reform pending before this committee. I would like to submit this statement for the information of the members of the committee and for inclusion in the record of these hearings.

I shall first discuss the House bills which correspond, either completely or in major part, with last year's Kennedy-Ives bill, S. 3974, as it passed the Senate, or with this year's Kennedy-Ervin bill, S. 505, as introduced in the Senate. As we see it, H.R. 1121, 1122, and 1168 correspond with last year's S. 3974 as it passed the Senate; H.R. 3028 and 3302 correspond with this year's S. 505 as introduced in the Senate; and H.R. 3372, 3711, 3766, 3905, and 4610 correspond with this year's S. 505 except for certain variations from S. 505 in title III and title VI of these bills. All of these bills follow the same general scheme of organization, and we shall take up the subjects with which they deal title by

title.

TITLE I-REPORTING AND DISCLOSURE

The basic conception embodied in title I of all of the bills which I have listed is that reporting and public disclosure with regard to union finances and with regard to certain aspects of employer finances will tend to deter or at the least serve to reveal some types of abuses disclosed by the hearings of the Senate select committee. As members of this committee know, the AFL-CIO believes that this idea is sound.

Over a period of years we supported the Douglas-Kennedy-Ives bill, S. 2888, for full disclosures of the finances of health, welfare, and pension benefit plans, and as you know we opposed in the House of Representatives the various weakening amendments to S. 2888 sought and in part secured by certain large insurance companies and employer groups. We have repeatedly stated and again state our hope that this law will be revised to make it an effective reporting and disclosure law for welfare and pension plans.

A year ago, in testifying before the Senate Committee on Labor and Public Welfare, I expressed the view of the AFL-CIO that this full disclosure principle could likewise beneficially be applied to other aspects of union and management finances. I accordingly urged that all unions, except such small locals as might be exempted by the Secretary of Labor, be required to file annual financial reports. I further urged that these union financial reports not only be made available to union members, but that they be made public-instead of merely gathering dust in some Labor Department sanctum, as reports now filed under the Taft-Hartley Act do.

These Taft-Hartley reporting requirements are not as extensive as those in the bills which are now being considered by the committee. If these new provisions are adopted, therefore, I assume that the reporting requirements in section 9 (f) and (g) of the Taft-Hartley Act will be repealed.

We support proposals for full and public reporting on union finances, as well as on certain organizational matters. We do, however, want to point out that the provisions for union reporting on finances go very far. These bills not only spell out certain types of expenditures that must be reported, but contain such catchall phrases as "other disbursements of any kind and the purposes thereof." These provisions, together with the broad authority these bills give the Secretary of Labor to prescribe the form of the reports required to be filed, confer on the Government carte blanche authority to demand reporting and disclosure of union finances in the most minute detail.

I call your attention to the detailed character of the reports to be required of unions for two reasons. In the first place, it underlines the need for exempting small local unions from these financial reporting requirements, while giving to the Secretary of Labor power to cancel the exemptions of any local union if he has reason to suspect financial abuses. We have had numerous complaints from unpaid secretaries-treasurers of local unions that the filling out of the present Taft-Hartley forms is excessively burdensome. Financial reporting requirements which may be feasible for international unions or for large local unions may impose unreasonable burdens upon the secretaries-treasurers of small local unions who work full time at their trades.

In the second place, I want to call your attention to the fact that while we have supported these proposals for all embracing financial reports by labor unions, various employer organizations have bitterly opposed the proposals for much more restricted employer reports on their financial disbursements in the labor-relations field. Since employer opposition to these proposals that they too do a bit of reporting had, I think, a good deal to do with the defeat of the Kennedy-Ives bill in the House of Representatives last year, I want to go into that subject in some detail.

The business community has not come out of the McClellan committee investigation with entirely clean hands. Of course, the headlines make labor the main target. But anyone who takes the trouble to read beyond the headlines must understand by now that many employers have not hesitated to break the law to destroy unions; that some employers have collaborated with gangsters to make higher profits; and that for every corrupt union official who took a bribe there was at least one corrupt employer who gave the bribe.

Let me enumerate briefly some of the types of law violations in which, according to the hearings of the select committee, employers have engaged in combating the efforts of their employees to organize.

Some employers are, it seems, still using labor spies in their plants. A Chicago "labor relations consultant" named Shefferman-whose long list of clients included such concerns as Sears, Roebuck and other well-known corporations— sometimes supplied professional operatives to serve as labor spies. Sometimes, and probably more often, an employer simply suborns someone already working in the plant to act as a spy for him.

At least one antiunion employer, the Kohler Co., was revealed to have hired detectives to shadow union officers and members, and even employees of the National Labor Relations Board, in an attempt to unearth discreditable material from their pasts. This activity of the Kohler Co. seems to me utterly contemptible.

Employers seeking to break unions are still extensively resorting to the discharge or demotion of union adherents, or to discriminating against them on the job in various other ways. At the same time rewards are provided for those opposing the union. These rewards may be in the crude form of direct monetary payments, or in the subtler form of promotion to better jobs.

Some employers even continue to resort to closing their plants or moving to another city, if necessary, to avoid unionization.

The use of spurious employee committees to work against the union was a favorite Shefferman device. These committees were started, staffed, and financed by the employer. Their antiunion propaganda was supplied and paid for by the employer. Sometimes the employer provided the services of a lawyer to guide them. The members of these employee committees were usually given financial rewards by the employer for their antiunion activities.

Employers are also still using the old company union scheme to bar legitimate unions. Faced with the desire of their workers for a legitimate union, some employers attempt to foist off on them instead a phony company union dominated by the employer.

Sometimes, however, if an employer feels that he cannot block entirely the unionization of his plant, he calls in a union of his choice. The International Brotherhood of Teamsters and the Bakery and Confectionery Workers International Union of America-both since expelled by the AFL-CIO—were revealed at the select committee hearings to have served in this role. By making a "sweetheart" contract with a union of this sort, employers seek to prevent representation of his employees by other unions which might be more legitimate and more militant.

It was even brought out at the select committee hearings that at least one employer had restorted to the old, old practice of committing acts of violence for the purpose of blaming them on the union.

As we in the labor movement well know, none of these types of employer conduct are new. The Taft-Hartley Act contains a number of provisions, retained from the Wagner Act, specifically aimed at certain of these practices. Indeed our attorneys agree with the NLRB attorney and the ex-Shefferman attorney who testified before the select committee that most if not all of these antiunion practices now constitute unfair labor practices under the National Labor Relations Act.

It is evident, however, that the National Labor Relations Board affords no adequate or efficient remedy against these types of employer conduct. Something more is needed than a cease and desist order issued 2 years later. Employer reporting of labor relations disbursements would help fill this gap.

If employers have to report their payments to a firm like Shefferman they may think twice before retaining it. At the very least the National Labor Relations Board and any union involved would learn that the employer had used an outside firm in labor relations. Even though they might learn this only after some months, it would be of some value even then. In several of the situations developed by the select committee in which the Shefferman firm was active, for example, unfair labor practice charges had been filed by a union against the employer, but neither the union nor the Labor Board succeeded in developing the evidence later disclosed by the select committee. If, however, they had known of the Shefferman connection they might have been more successful. In addition, public reporting would operate as a sanction against improper disbursements by the employer himself which are unfair labor practices now, such as the subsidization of an antiunion employee committee or the hiring of detectives to shadow union adherents. An employer would be faced with the options of disclosing his unlawful conduct, of making a false report, or of discontinuing these improper practices. Many, surely, would elect the last course. I wish to stress, therefore, that proposals for financial reporting by employers have a very direct relevance to preventing concrete employer malpractices in the labor relations field.

Further, even the most rudimentary sense of fair play demands that if unions are to be required to make full public disclosure with respect to all aspects of their finances, employers at the least should be required to make similar public disclosure of their expenditures in the field of labor relations. If the UAW is to be compelled to reveal how much it spent supporting the strikers in the Kohler strike, the Kohler Co. should likewise be compelled to reveal how much it spent trying to break the strike. Again, some employers, such as the General Electric Co., as a matter of regular practice inundate their employees with a steady stream of antiunion propaganda. If the unions comprised of General Electric employees are to be required to report expenditures made to counter this antiunion barrage, surely fair play requires that the employer report its costs, too. Public financial reporting should be required not only of union and of employers in their labor relations, but also of outside labor relations consultants. A requirement that these consultants make full and public report of their receipts and disbursements should go a very long way toward correcting abuses in their operations. I do not, of course, mean to imply, any more than I do in the case of employers and unions, that most, or even many, labor relations consultants are guilty of the sorts of malpractices disclosed by the select committee. In my view many labor relations consultants perform a valuable and constructive role in labor-management relations. Others, however, are engaged simply in the business of union busting, and are likely to be none too scrupulous in their choice of means. Reputable consultants would have nothing to fear from full reporting and if disreputable ones have something to fear, so much the better. In this connection I would like to say a word about the statement recently emanating from the American Bar Association. This statement asserts that

labor relations consultants may sometimes be lawyers, that labor relations consultants who are lawyers may sometimes engage in activities falling within the legitimate practice of law, and that legislation should not require disclosure "*** of any matter which has traditionally been considered as confidential between a client and his attorney, including but not limited to the existence of the relationship of attorney and client, the financial details thereof, or any advice or activities of the attorney on behalf of his client which fall within the scope of the legitimate practice of law." While I find this statement somewhat vague, it seems to mean that labor relations consultants who are also lawyers should be exempted from reporting requirements.

I agree with the American Bar Association that labor relations consultants may be lawyers. The Shefferman firm included a number of lawyers, and some of its most disreputable work was done by them. The select committee also brought out that employers sometimes use a lawyer having no open connection with the employer to set up a phony antiunion committee in the plant. In such a situation the employees who are picked out by the plant manager or foreman to head the committee are referred to the lawyer, who then draws up the committee's bylaws and prepares its propaganda. The lawyer is then paid, sub rosa, by the employer.

The bar association evidently thinks that in such a situation it would be outrageous to require disclosure of "the existence of the relationship of attorney and client" and particularly of "the financial details" thereof. Its report specifically lists antiunion ghostwriting as an example of legitimate practice of the law on which public reporting should not be required.

Needless to say, I do not agree with the bar association. The proposition that persons engaging in labor relations work, whether reputable or disreputable, should enjoy some special immunity from reporting if they happen to be lawyers strikes me are arrant nonsense. I am surprised that it is advanced even by the American Bar Association.

Before leaving this subject of reporting and public discloseure, I would like to say a word about the conflict-of-interest reports proposed to be required of individual union officers and employees. Provisions requiring such reports are found in the Kennedy-Ervin bill and in the various House bills which, in general, parallel it.

These provisions require annual reports from union officers and employees of any of certain specified types of transactions in which they have engaged during the preceding year. These types of transactions may be described as conflict-of-interest situations.

These provisions seek to implement by legislation and through the device of public disclosure the principle set forth in the "AFL-CIO Ethical Practices Code IV," dealing with investments and business interests of union officials. That code declares:

"1. No responsible trade union official should have a personal financial interest which conflicts with the full performance of his fiduciary duties as a worker's representative."

The code also seeks, as do the various bills, to enumerate specific types of transactions which fall within the ban of this principle.

It is thus manifest that we have no disagreement with the principle which these bills seeks to implement. We have, however, one warning. That is that it is one thing for a voluntary organization to lay down a general ethical standard for the guidance of its members-if they wish to remain members-and a different and more difficult thing to implement such a general standard by criminally enforceable legislation.

Nevertheless, the principle that union officials and employees should not have personal financial interests which conflict with their fiduciary responsibilities to their union is sound and important, and we therefore support these proposals to require public reporting of financial transactions which may involve conflicts of interest.

Powers to be given to Secretary of Labor

Title I of S. 505, and of the parallel House bills (e.g., H.R. 3028, 3302), besides providing for the various types of public reports which I have discussed, contains a number of other significant provisions, some directly related to the reporting requirements and some not. Perhaps the most important of these provisions have to do with the powers to be given to the Secretary of Labor.