Page images

The Board has diligently pursued the improvement measures which I mentioned to you a year ago, including more regular case inventories, tighter deadlines, higher production quotas, reduction of unnecessary work overlaps, and others. I am happy to report to you that as a result productivity was improved almost 15 percent in 1965, reaching the highest point ever achieved. We have. however, programed a further 5.9 percent increase in efficiency for 1966 and 1967 and will continue our efforts to achieve improvement.

Other cost reduction goals

We have made plans to decrease our miscellaneous expense costs by reducing wherever possible the rate of expense. This includes: reducing the rate of expense for teletypes by encouraging the use of regular mail wherever possible, reducing costs for travel by better planning for travel and by using the most inexpensive mode of travel in most instances, reducing costs for supplies by tightening up on inventory handling, and other similar reductions.

Automating the printing and publishing of Board decisions

We have also started on a program of automating the printing and publishing of Board decisions which is designed to eliminate time delay, improve efficiency, and by 1968 should help to reduce our expenditures for this purpose. We are consulting with the Government Printing Office and the Bureau of Standards on this program. The Government Printing Office is installing a photo-composition process capable of being fed by magnetic tape containing the body of material to be printed and printing instructions. Through the use of special typewriting equipment such as Flexowriters we hope to produce a tape which can be fed to a computer capable of converting the tape to a form acceptable to the Government Printing Office equipment. The Bureau of Standards is assisting us with the writing of the necessary computer program. If possible we will complete the programing this fiscal year and begin by ordering some of the necessary equipment. It was originally estimated that the bulk of the equipment would be ordered in 1967 and $90,000 was provided in the budget request for 1967 for the purchase of this equipment. We are proposing, if our cost reduction allows, to spend as much as $100,000 on this program this year.

It is our hope that the program will enable us to eliminate the 1 year delay in publishing Board decisions. We also hope, by immediate printout of Board Decisions through the Government Printing Office process, to eliminate considerable duplication of Board and trial examiner decisions now necessary in order to provide a copy to all those who work with these decisions on a current basis. We have been told that this program can save us $50,000 to $100,000 a year, in addition to the great improvement in the amount of time required to publish Board decisions.


Our main concern at this time is still the solution to the rising tide of unfair labor practice hearings and resulting formal action. At the same time we have and will continue to pursue diligently the President's goal of making certain that full value is secured for every dollar spent.

With your guidance and understanding as in previous years, we intend to meet and deal with these problems as effectively and skillfully as we can bearing in mind at all times the responsibilities laid on us by the Congress.


Mr. FOGARTY. The appropriation for 1966 is $28,165,000 and the request for 1967 is $30,442,000, an increase of $2,277,000 to cover pay costs and other mandatory expenses and an increase of 107 positions. Mr. McCULLOCH. That is correct.


Mr. FOGARTY. About two-thirds of your personnel are in the field but I notice over half of the increase you are requesting is for the Washington office. Why is that?

Mr. McCULLOCH. The Washington increase is made up of 18 positions for the Board, consisting of 10 legal assistants and 8 clericals. Of the clericals, five would be on Board members' staff and three in the Executive Secretary's office.

Four clerical positions would be added in the Division of Trial Examiners to handle the greatly increased volume we expect in that Division.

The remainder of the Washington increase, 32, will be in the General Counsel's office. Those are primarily in the Divisions of Litigation and Administration.


Mr. FOGARTY. You are asking for 107 additional positions. How many did you ask the Bureau of the Budget for?

Mr. WRIGHT. Fourteen more.

Mr. FOGARTY. You got 107 out of 121?
Mr. McCULLOCH. That is right.


Mr. FOGARTY. Is your backlog greater or less than it was a year ago? Mr. McCULLOCH. It has remained just about steady with some light reductions planned at various points. We have a particular bulge at the level of the trial examiners and my statement goes into that a little more fully.

Mr. FOGARTY. Yes; I read the statement.

Mr. McCULLOCH. At that point we have had a buildup which we are seeking to meet both by full use of the additional funds made available by the committee last fiscal year when we hired right up to the limit and took on 11 additional trial examiners-and this current year when we have moved just as quickly as possible with new hires of trial examiners to try to meet that case bulge at the trial examiner level. Mr. FOGARTY. If you get these additional positions you are asking for, will this cut down these delays or do you need a change in the law? Mr. McCULLOCH. We hope to cut down on the delays and backlog without a change in the law. The clogged trial examiner calendar has been a primary factor at this point.

The Board itself reduced its delay in the past year by about 30 days in the handling of the case from the trial examiner's decision until the issuance of the Board's decision. This was a reduction of 30 days notwithstanding the fact we have made new procedures available crossexceptions and reply briefs-in line with some recommendations of the American Bar Association, which tended to add a little extra work and delay. But the thing that has been the sticking point again in reducing the overall time delay has been the overload at the trial examiner's level. We have goals which we may not be able to meet fully this year or next year but, given the requested appropriation, we should make a substantial reduction.


Mr. FOGARTY. Are you thinking of any changes in the law? Would that help?

Mr. McCULLOCH. We have been requested, as we were by Congressman Denton last year, for reactions to a suggestion of delegating greater authority to our trial examiners in unfair labor practice cases. Mr. DENTON. The House turned that down.

Mr. McCULLOCH. The Board favors the general plan.
Mr. FLOOD. What is the suggestion?

Mr. McCULLOCH. To delegate greater finality to the trial examiner decision, subject to Board and court review. This is a proposal which in 1961 was incorporated in a reorganization plan that President Kennedy sent to the Congress, but it was not approved at that time. It could be done by separate legislation or by a reorganization plan, and the Board has indicated its approval of that proposal.

Mr. DENTON. The decision is final in representation cases.
Mr. McCULLOCH. Subject to Board review.

Mr. DENTON. Subject to review, yes.

Mr. McCULLOCH. And that has resulted in a continuing reduction in the time delay factor. The figures we have indicate it cut the time for the handling of representation cases, from the filing of the representation petition to the issuance of the order directing the election, almost in half. That is still going on. We believe that the example of the successful operation there, which the Congress authorized the Board to undertake, may provide some persuasive evidence in favor of the other proposal, of delegating greater authority to the trial examiners in unfair labor practice cases.


Mr. FOGARTY. Mr. Ordman, we will put your statement in the record at this point.

(The statement referred to follows:)

I wish to thank the committee for this opportunity to appear on behalf of the National Labor Relations Board and to support its budget request for 1967.


The agency is requesting $30,442,000 for 1967, or $1,728,900 more than the $28,713,100 which is required for 1966. This increase will pay for $787,100 in mandatory administrative costs, $90,000 for automating the printing and publishing of Board decisions, and $851,800 for an increase of 107 positions to handle increased work requirements. The 107 positions provide an increase of 4.5 percent in positions to handle an increase in work of about 8 percent; 6.1 percent in increased intake and about 1.8 percent in increased backlog.

The General Counsel's staff is to be increased by 85 for an increase of 4.3 percent. The field staff is to be increased by 53 for an increase of about 3.5 percent. The larger percentage increases are in the Washington staff because of the increased backlog problem in the agency's formal work. The difference between increased work and increased manpower are to be absorbed by our management improvement cost reduction efforts.


We see further intensification of the factors which have led to increased intake in previous years. The most important indicators include the Nation's unparalleled economic growth, the population explosion and its effect on the work force, the rising tide of labor union organizing activity and the stiffening resistance evidenced in certain sectors of management to labor union organizing efforts. A reporter for the Wall Street Journal, for example, recently reported on the increased organizing efforts by labor unions and the increasing resistance by companies.



Charges are filed by unions, employers and individuals. Charges filed by unions and employers are responsible for the 70 percent increase in total charges filed since 1958, while charges filed by individuals have remained almost unchanged. Charges filed by unions have risen from 2,759 in 1958 to 7,737 in 1965, a rise of 280 percent. Charges filed by employers have risen from 1,091 in 1958, to 2,617 in 1965, a rise of 240 percent. Charges filed by individuals have risen from 5.410 in 1958, to 5.446 in 1965, a rise of less than 1 percent. charges did rise higher in 1959 but have declined since.)

Employer filings


The rise in employer filings reflect primarily the additional provisions in the 1959 amendments. Increases are high in charges of illegal picketing under the new 8(b) (7) provisions and of 8(b) (4) under the strengthened secondary boycott provisions. There are also increased charges of union failure to bargain in good faith.

Union filings

The increased 8(a) (5) charges against employers as well as the continued rise in 8(a)(3) charges of employer discrimination against individuals for engaging in union activity are a reflection of the increased organizing efforts by unions. A sample study recently made of charges filed indicated that three-fourths of all union filings under section 8(a) are directly related to organizing or first bargaining situations.


This analysis indicates that the agency is being relied on by the parties to carry out its congressional mission of furthering industrial peace by assisting management and labor on finding solutions to their disputes through peaceful methods of collecting bargaining rather than by resort to striking or lockouts.


The decline in the proportion of individually filed charges and the rapidly rising increases in charges filed by unions and employers, especially the refusal to bargain charges, have meant unusually large increases in the required work processing effort.

One very important effect has been the rise in merit. In 1958 cases found to have merit (those in which settlements were worked out or complaints issued) amounted to 20.7 percent. This percentage has been rising steadily and in 1965 was over 34 percent. Meritorious cases require much more work effort than nonmeritorious cases. It is quite possible that one of the reasons for the increase in meritorious cases has been the increased proportion of cases filed by unions and employers. They are more likely to know what constitutes illegal activity than the individual who was filing 58 percent of all charges in 1958 and who filed only 35 percent in 1965.

Experience teaches us that refusal to bargain allegations (sec. 8(a) (5)) are more likely to have merit than other types of charges. In 1958 when 8(a) (5) charges constituted only 11 percent of all charges, they were found in 18 percent of complaints and 22 percent of all hearings. In 1965, 8(a) (5) charges constituted 24 percent of all charges, 34 percent of all complaints, and 40 percent of all hearings.


The continuing rise in case filings as well as the increasing proportion of merit cases have and continue to pose the most difficult operational problems for our regional offices. Our standards are high. We expect the regional offices to handle and dispose of about 90 percent of cases filed. We set time standards for expeditious handling, but at the same time we insist on quality performance. We also continue to work at securing constantly improved and more efficient operations. I am very happy to report to you that our field offices continue to meet all of the demands listed above and have performed magnificently.

One very important measure of this performance is settlement of cases. With the rapidly rising filing of merit cases, settlement becomes our main bulwark for continued achievement of the agency's mission. Settlement is economical because it saves time and money for the Government and the American public. Settle

ments keep the Board's decisional processes from being flooded with work. Every merit case that is not settled requires formal hearing and trial examiner decision. If we cannot secure compliance with the trial examiner's decision, it becomes necessary for the Board to rule on the issues. If we cannot secure compliance with the Board's decision then we must seek enforcement in the U.S. courts of appeals. But perhaps more important than all of this is the fact that settlement is better than litigation. While this is true in all fields of the law, it is particularly true in labor-management relations because in most instances the parties to the dispute are going to continue to have to live and work together. In a real sense, therefore, settlements are themselves a form of collective bargaining which it is the Board's duty to foster.

If you will look at the pie charts on pages 5 and 6 of our justification statement you will see how we are continuing to emphasize and to increase the percentage of cases settled or adjusted voluntarily. In fiscal year 1964, for example (p. 5), 23.9 percent of ULP cases closed were closed by settlement or adjustment. In 1965, this percentage rose to 25.1 percent. This was an increase of 1.2 percent of the 15,219 such cases closed, or approximately 180 cases. This could have meant an increase of approximately 120 ULP decisions for the Board to issue and 60 more briefs to be filed in the courts of appeals. When we consider the fact that the Board issued 774 ULP contested decisions in 1965, the magnitude of this accomplishment becomes apparent. Another view of the importance of the settlement effort is the proportion of settlement to the total number of merit cases closed. As the chart shows, in 1965, 34.3 percent of unfair labor practice cases closed were closed by settlement or after issuance of complaint, indicating merit-that is, they were not closed by dismissal or withdrawal before complaint-25.1 percent of the total, or over 73 percent, of the meritorious cases were closed by settlement. In other words, three out of four meritorious cases are settled.

Similarly, in representation case handling (see p. 6) agreements increased from 50.1 percent in 1964 to 54.2 percent in 1965. The need for hearings decreased from 17.7 percent in 1964 to 15.3 percent in 1965. As a result, the number of hearings actually held decreased from 2,131 in 1964 to 1,964 in fiscal year 1965. The need for regional director decisions decreased also from 1,882 issued in 1964 to 1,761 issued in 1965. These decreases in formal requirements for representation work were achieved despite an actual increase in representation case intake in 1965 and with the concomitant maintenance of currency in representation case handling.

As part of our continuing management improvement and cost reduction program, we have undertaken an extensive review of regional office operation. This review resulted from our meeting with regional office management personnel in fiscal year 1965. In the 1965 meetings, we discovered that management practices varied from region to region and that many of our middle management supervisors felt that efficiency could be considerably improved. After studying the reports submitted by the various committees at these meetings, we came to the conclusion that regional office management could be improved by the development of a model regional office concept or prototype. We worked on this concept early this fiscal year and then discussed the prototype with top regional office management at a series of meetings in the fall of 1965. There was general agreement that adherence to the general principles of the prototype would improve regional office operations in most instances. We have, therefore, issued instructions to all regions to conform their operations as closely as possible to the prototype, yet with sufficient flexibility to take into account the industrial relations requirements of each regional area. It is our hope and expectation that regional office operation and efficiency will improve substantially as a result of the management guidance provided to them. We expect to see a tightening up of supervisory procedures and clarification of lines of authority with corresponding economy in supervisory time with consequent reduction in number of supervisors, increased quality in work performance, and more expeditous case handling. We have improved efficiency in our regional offices by 5.2 percent in the last 2 years. We hope to improve efficiency in 1966 and 1967 by another 7 percent as a result of the management improvement measures we are undertaking as well as those we have taken in the past.

We have also taken a hard look at our field miscellaneous expense costs and have estimated reductions wherever possible. We hope that the streamlined regional office organization will provide better planning and reduce travel without prejudice to the expeditious handling of cases, thus reducing the rate of

« PreviousContinue »