affects interstate commerce today. They would move right in and immediately start proceedings to alleviate the situation.

Now, it does not say that the Federal Commission can't use 60 days if it so desires. It does not say they can't use 120 if that is necessary, but it is to expedite these cases that the bill is before us today. If there appears to be complaint-now this is the origin of this bill-it comes from the complaint on the part of those discriminated against in job opportunities that by the time they get around to the 60- or the 90-day waiting period, the jobs either disappear, they have lost their argument or they have gone away from the scene. This is the question involved here and that is the main point of this whole legislation, Mr. Bell, to expedite the cases that come before the Commission.

If you take this out, you do not have any bill here to discuss.

Mr. BELL. If the State adequately expedites them there is no need. Mr. DENT. I think Mr. Hawkins is very aware of the problem more so than the rest of us because his State has had greater experience. Mr. BELL. It is operating very well in California.

Mr. DENT. Sometimes we will put it that way. We must then consider in the subcommittee whether or not we wish to give the Commission the right to work in conjunction with a State and if a State's operations are such that it is expediting the cases within a reasonable period I would imagine that we can give the Commission that latitude to decide whether or not they will move into this particular area immediately or whether they will let the State handle it.

If we do that, will that meet your objection?

Mr. O'SHAUGHNESSY. House bill 9222 has a section similar to title VII which permits an entering into treaties with the States-the terms of which, the State will have primary responsibility and this area it should be marked out in the agreement according to the statute.

So far there have been no agreements of that kind. If the Federal Commission would enter into an agreement with the State of Illinois by the terms of which the State of Illinois would have primary responsibility then obviously this would remove some of the problem.

However, if House bill 9222 passes as it is written and Illinois' coverage stands at 50, the coverage of the Federal bill would be at 8 and there would be an area where the Illinois State Commission would have primary responsibility for employers employing 50 or more people and the Federal Commission would have primary responsibility in the area of employers that employ 8 to 49 people.

This I think would be unfortunate because that would lead to confusion.

Mr. HAWKINS. That is the crux of the matter and I think you brought it out and that is that the present proposal, H.R. 9222, does provide these written agreements to be made with a State but that you fear inasmuch as the State law in the State of Illinois would be Mr. O'SHAUGHNESSY. More restrictive

Mr. HAWKINS. That such agreement cannot be worked out or if it is worked out it would provide in one instance a coverage that is not provided in the other, that is, the cases between 8 and 50 would not be covered by this agreement.

Mr. O'SHAUGHNESSY. That is right.

Mr. HAWKINS. A large number of the States are already at eight which would be lower than the Federal law so obviously a written

agreement with the State of California, for example, would end in the State law being more restrictive than the Federal law and obviously such a written agreement would not be difficult to negotiate.

In a State like Illinois, for example, where the State law is much broader, exempts a much larger number, a written agreement would be very difficult to negotiate.

Obviously the answer to that is for the State of Illinois to bring its law into conformity with the Federal law if it wishes to have this preemption.

Obviously it is not going to get the preemption unless it does with those cases below 50. Fifty is much higher than the 25 which is envisioned in the Federal law when it is in operation.

I think your problem in Illinois, in order to achieve that preemption, is to consider the amending of your State law rather than to attack a Federal law with 25 which we believe is too high and which should be reduced to 8 which is in conformity with most of the State laws.

Mr. O'SHAUGHNESSY. Mr. Hawkins, in response to your last comment, it is apparent that Illinois is going to have to amend its statute next session of the legislature, 2 years from now, to bring the coverage down to 25, to bring it in conformity with title VII which will then be at 25 or shortly thereafter. This I think is clearly indicated.

All we are asking is that it not be dropped at this point, right now, that it not be dropped down to eight.

Mr. HAWKINS. If we provided for a deceleration to reach the eight in a certain period of time, would you object?

Mr. O'SHAUGHNESSY. I don't think I am wise enough to answer that question. I can't see what all the problems will be in the future and I certainly can't see what they would all be if it were dropped 5 years from now. I am inclined to think that maybe in 5 years the business community-the attitudes would be so changed that there would be very little impact if it were dropped to 18.

Mr. DENT. Would the gentleman yield?

Mr. HAWKINS. If you yield at a certain figure I think you know what will happen is that you will operate on the basis of that particular number, say 100 or 125. But if you decelerate in a graduation over a period of 2, 3, 4, whatever the committee feels is the right number of years, then you would be reducing the impact each year and graduate into the lower figure, but if you wait for 5 years and you now have it at 25, which is the number that has been established for 2-, 3-, 4-year period, then you come in to Congress, and Congress comes out and reduces this to 8, the same impact you are complaining about now justifiably also would be apparent at that time.

The suggestion made by the gentleman has a great deal of merit and it is worthy of consideration. By setting a goal and reducing on a yearly basis a certain number, we relieve the impact whether you wait for 10 years to put that impact into effect or if you do it immediately today. In other words, you have the problem, the fear that the number of cases would clog the machinery, it would mean a great expansion of untrained people to take over-but if you know that next year it is going to drop to 25 and the year after it is going to drop to 15 and the year after it is going to drop to 10 and the year after it is going to drop to 8, then you are training people to meet the deceleration of the number.

Don't you think that would be more meritorious rather than waiting to see how it works in 5 years and then come in and amend the act to include a lower number?

Mr. O'SHAUGHNESSY. Here I will have to distinguish between myself and as a spokesman for the chamber.

Mr. DENT. What do you think?

Mr. O'SHAUGHNESSY. I can say that the suggestion is not without merit.

Mr. HAWKINS. That is a great concession.

Mr. O'SHAUGHNESSY. I don't mean to begrudge a compliment. Mr. HAWKINS. We are suggesting some concessions also in postponing the eventual day.

Mr. O'SHAUGHNESSY. Let me just give you the reason here why I think that and I do have to try to balance two different concepts. One is a large number of small employers who will be covered and who are not again capable of handling the problems themselves because some of these problems get pretty sophisticated, and on the other hand compelling the employer who looks at the realities and say there is going to come a time when I am covered by the Federal statute, may I have to start changing my thinking right now.

These are the two balancing interests that you asked me to consider. I do think that a large number of covered employers who are unsophisticated men who may hold deep prejudices that are unwholesome could result in the kind of confusion that would be undesirable all around-acrimonious, bitterness-this, I think, must be avoided at almost any cost. I do wish you gentlemen, if you have an opportunity, would see this film "Challenge" and I think of Bill Quinn, president of the Milwaukee Railroad, said we think this is good business and you see Mr. Patterson saying he thinks this is the way it should be done, and one executive after another standing up in the film for everybody to hear, they don't weasel words, they say it is good business.

Mr. DENT. If the committee desires or feels it would be helpful, is there a copy of the film that is available in order that we might have a showing for the House Members?

Mr. O'SHAUGHNESSY. There certainly is. Mr. Perry would be most happy to arrange it.

Mr. DENT. Thank you very kindly.

Mr. HAWKINS. I have just one other question, Mr. Chairman. Mr. O'Shaughnessy, I think you mentioned something about the quota system and you feared that this might work disadvantageously. I am sure that you are aware that the act does prohibit actually preferential treatment and that any system based on a quota system or preference treatment is actually prohibited.

In view of that provision in the present law I am wondering whether or not your argument about a quota system of the employer being disadvantaged because of the feeling that he has to employ a number of minorities is unfounded because the law is clear on that particular point and it would seem to me that particular part of the law is something that would not present any difficulties.

It certainly has not in the experience of other States. I wonder why it is you made such a point out of that.

Mr. O'SHAUGHNESSY. I did not mean to make a point. I believe it is mentioned here in the written statement.

Unfortunately, sir, the President's Committee on Employment Practices was doing business with employers who have contracts with the Federal Government. Unfortunately, some of that experience has not been very wholesome because some clients, including some of my clients, have been told that they had better hire Negroes.

Mr. HAWKINS. I don't know the operation of that system but I would assume that in looking at records and seeing, let's say, the absence of Negroes in certain jobs in certain departments or in certain industries, is itself some indication that that enterprise may be discriminating, but whether that is so or not the proposal and the existing law has written a provision that it seems to me covers this point and protects the employer.

Mr. O'SHAUGHNESSY. That is right.

Mr. HAWKINS. This is something you should certainly consider as being a protection and obviously not being something that can be used as an argument against the proposal.

Mr. O'SHAUGHNESSY. No, sir; I did not mean to do that if that impression was created. Anybody who has worked in this field realizes this but unfortunately many businessmen are not aware of this.

I think you will hear-among your own constituents you hear, "Now we have to turn down a white person and hire a Negro."

Mr. DENT. A quota system in itself is a bad concept to even start with and we know that in some communities for instance where they have a very, very low percentage in a communitywide count probably in some of those areas, and it is true in some of our areas up home, the Negro worker has a greater percentage of the jobs available than his quota would be.

Now how do we ever even start to let that creep into the law and we have tried to write in safeguards so that that would not creep in but we believe where they have been told, you ought to hire Negroes, because they have hundreds of employees, and in this whole area of employment they do not have one and they have had applications and applications of employment.

Now that is almost a clear-cut case of discrimination.

Mr. HAWKINS. In that instance it has to be proved that a qualified person has applied and has been turned down so it is not merely the statistics that would have the facts that would be considered but it would be whether a qualified person has fully applied and been discriminated against.

I think that is the point of the law.

May I offer this one comment and then I am through. Under the State law in my own State, the State of California, this point has been discussed and recently, and I commend this case to your attention: the Bank of America was picketed because of allegations that the Bank of America was not employing minorities. In that instance the State fair employment practice commission defended the hiring practices of the Bank of America against the complainants, those public persons who were picketing the Bank of America.

So this is a case in which I think indicates that this can work both ways, that a law that protects the employer against what they may sometimes consider direct action or unfair protest movements certainly I think will work to their advantage in the long run and many

times will work to the disadvantage of minorities who may feel that they are discriminated against but who actually may not be qualified, so I think that the law works both ways and I think that that is something, one of the main reasons why I believe that the responsible grants that wish to uphold merit employment should be in favor of a law and not against it.

Mr. O'SHAUGHNESSY. May I ask a question, sir? Did the State. commission in California then get an injunction to restrain the picketing?

Mr. HAWKINS. They did not accept the jurisdiction, so the protest against the Bank of America just melted away.

That is all.

Mr. DENT. Thank you, and if there are no further questions, I want to thank both you gentlemen for appearing here today and giving us the benefit of your thinking, and I am sure that if there are any further questions on the part of the committee, if addressed to you, you will be kind enough to give us the benefit of your thinking on the matters. Mr. O'SHAUGHNESSY. We will be very happy to, Mr. Chairman. Mr. DENT. At this time without objection I would like to present for the record, the testimony of the Chamber of Commerce of the United States and make the announcement that tomorrow at 9:45 the committee will again reconvene and have as its witnesses the Honorable George H. Fowler, chairman of the New York State Commission for Human Rights, and the Honorable James Kemp, commissioner, Illinois State Fair Employment Practice Commission. (The document referred to follows:)

STATEMENT OF THE CHAMBER OF COMMERCE OF THE UNITED STATES

The chamber appreciates this opportunity to present its position on H.R. 9222, introduced by Representative Powell, Democrat, of New York. This bill would amend title VII of the 1964 Civil Rights Act in two important respects. It would, first, extend the coverage of title VII to all employers affecting interstate commerce with eight or more employees. Second, it would give the Equal Employment Opportunity Commission, the agency which enforces title VII, the authority that it does not now possess to issue cease and desist orders in cases involving discrimination in employment.

CHAMBER'S POSITION

The proposals contained in H.R. 9222 are premature. Furthermore, the objective of title VII, equal employment opportunity, will be achieved without these proposed changes.

The proposal to expand the authority of the Commission presupposes that the Commission now lacks the necessary authority to enforce title VII effectively. Similarly, extending the law to smaller operations implies that existing coverage is inadequate to provide equal opportunities for employees. These assumptions, however, are conjectural since title VII became effective only on July 2. It is, therefore, too early to determine whether the Commission's authority should be expanded and whether coverage should be extended. For this reason alone, a proper evaluation of title VII in these respects should be deferred until the Government has gained sufficient experience in the administration of this law.

EXTENDED COVERAGE

Existing law, which now applies to all employers with 100 or more employees, will not become applicable to employers with 25 employees until 1968. The reason for this is that it allows the smaller operations-and its employees-to become adjusted to this law. The proposal to extend the law to even smaller employers should await a determination of its impact on smaller operations.

Second, the smaller the operation, the less impact it is likely to have on interstate commerce. These are the employers that State fair employment practices