Mr. WEISS. Back in 1939 and 1940 they were not affected. The same machinery was used. In fact, I think it encouraged collective bargaining, because it brought management and labor representatives together. They met, and I think both labor and management will attest to that fact. It did encourage friendliness between them, and encouraged collective bargaining rather than discouraged it.

Mr. MORTON. I sincerely hope you are right. I have only one more question.

Mr. BURKE. Will the gentleman yield?

Mr. MORTON. Yes.

Mr. BURKE. I would like to say as a preface that I am violently opposed to compulsory arbitration because I believe it makes a lazy employer group and a lazy union group, and sets up a conveyor of even minor grievances to the arbitrator to decide for them. But I believe that you will find that-and I would like to ask these gentlemen's opinions on it-the minimum will support the wage levels arrived at by collective bargaining, rather than tend to bring them down, because that, I believe, will be welcomed and has been welcomed in the past by both employer and employee, who have arrived through fair and free collective bargaining at a decent wage standard. Is that not true?

Mr. WEISS. That is absolutely right. They cannot maintain it then under collective bargaining if you have the undermining of lowwage competition. That is why the law was created in the first place, because the whole labor standards collapsed because of the pressure of low-wage competition.

Mr. MORTON. I have my other question now. Let us say a minimum wage is set in a plant at 80 cents, and that differentials for skilled labor is established at 40 cents over the minimum, or $1.20 for a certain group of employees. Now we come along with an industry-wide agreement, and a 2-year contract is signed-or any period. We come along and establish a rate of $1. Of course, that means that the minimum in the industry is $1. Is there anything in this law which says that the contract which has been signed for a year or 18 months, or some other period of time, automatically is opened to renegotiation?

Mr. WEISS. No.

Mr. MORTON. Then the $1.20 man, unless the employer voluntarily extends to him-in other words, you are locked there with a 20-cent differential, so the next time bargaining comes up, your employer has a weapon, because he says, "You have been working 9 months, or you have been working 18 months, at a 20-cent differential. Why do you have to have a 40-cent differential?" and that man's particular skill comes in jeopardy.

Mr. McCoмB. I think union contracts would probably carry some provision which would allow them to open it up for renegotiation. Mr. MORTON. I hope that the attorneys for the unions will be cognizant of that point. That is all, Mr. Chairman.

Mr. LESINSKI (presiding). Mr. Werdel?

Mr. WERDEL. Mr. McComb, in the area I represent we have quite a mining district, some very large gold mines, lead mines, and tungsten mines. Those mines have been shut down now for 2 or 3 years The gold mines, of course, were down all during the war, and the

timber is rotting. They are down today because they cannot compete with foreign metals. They are neither subsidized nor is there a tariff to protect them. They cannot compete with the foreign metals because those established the price in our local markets and they cannot get the labor to produce at the price that is necessary to meet the market.

I believe that unions representing the employees that work in those places would be willing, under provision, to go to work at, say, something under $1 an hour if the men were available. But if you put this price in, those mines are down for all time until there is either a protective tariff or until there is a subsidization of the mining industry, which is practically ridiculous to consider.

Is there anything in the plans of the administration in the adoption of this bill to fit the tariff?

Mr. McCOMB. No; we have not any terms, and I do not think we should deal with the tariff situation. I think you should bear in mind that the rate we are asking--75 cents-by industry committee, could go up to a dollar. If those people out there consider the workman and the unions, that would be a consideration in establishing that minimum above 75 cents. That certainly would be the fact, and the evidence would be introduced to show that you should not go to a dollar. That is part of the flexibility.

Mr. WERDEL. But if you go to a dollar, you go to a dollar for everybody.

Mr. WEISS. Yes; but the committees would take into account whether they are curtailing employment in your area, and that is a factor which may well prevent going above 75 cents

Mr. WERDEL. It might be outweighed by the rest of the country? Mr. WEISS. It might be outweighed.

Mr. McCoмB. A dollar for your industry.

Mr. KENNEDY. Would you yield to a question?

Mr. WERDEL. Yes.

Mr. KENNEDY. Did you say those mines are shut down now?

Mr. WERDEL. Yes.

Mr. KENNEDY. And they could not get under way under the present 40-cent minimum rate?

:

Mr. WERDEL. For the gentleman's information, you should read the facts in the record of August 27. Because of the differential in labor rates in this country and outside of the United States, with no protective tariff, we are producing 26 percent of our lead when we did produce 100 percent. We are producing 1 percent of our manganese. We could not fight Russia for 6 months without convoying manganese either from Russia or India, all because of our lack of protective tariff on minerals.

To be sure, at the present time, the men who would work in the mines would work some place else; but if we pass this law, we are going to have to do something else to protect ourselves with strategic and critical minerals in the event we do face hostilities.

Mr. McCOMB. If you face hostilities, remember there would be consideration to exemptions, I am sure. I am sure Congress would consider those if you were curtailing strategic minerals. I certainly cannot help but say-and I do not think that you mean-that you should allow an industry such as mining to pay 40 cents when everybody else is paying 75 cents, and let the miners have to compete in the

market for goods that they have to buy, against the man who gets 75

cents.

Mr. WERDEL. That is right. You see, the thing I have expressed is the point I believe, and here it is practically affecting my area. Thousands of employees are involved.

Now, we have situations in a free economy in every business where we have marginal producers; and, when we pass this law, certain numbers of marginal producers are going out because of the increase

in costs.

Mr. McCOMв. As I recall, the Government subsidized the mining industry very substantially, particularly the marginal producer. They paid an additional amount so that they could pay the wage. In other words, they could make a profit. I think that is so, and was so during the war.

Mr. WERDEL. During the war, they were cared for. These industries were stimulated, but now all the investments are going. It is a serious thing in the area. I want to direct your attention to this paragraph again on page 6, line 16. The language is:

"Activity affecting commerce" includes any activity necessary to commerce or competing with any activity in commerce

I think that is the language we have been discussing here for the past day or two. But then you have the alternative there

or where the existence of labor standards below those prescribed by this act would burden or obstruct or tend to burden or obstruct commerce or the free flow of commerce.

I take it that that language, under the reasoning of the Supreme Court, was covered in the opinion of a lot of good attorneys in the United States. Under the last clause, it could easily mean that wherever, whether it is in the backwoods or where it is, if a man is, say, too little to compete in the market for radios or automobiles, that he then would be covered by the act. It could well be reasoned that way: don't you think?

Mr. McCOMB. It might be.

Mr. WERDEL. When we say that, all we are saying is that the uncertainty in that is practically restating an uncertainty that was in the first act and the courts settled it; is that correct?

Mr. McCOMB. There certainly would be some uncertainties under the second commerce clause.

Mr. WERDEL. The point I want to make is that there were many employers in the United States who were advised by their attorneys of what was interstate commerce, who believed honestly they were out of the act. Do we have any figures on the numbers of men who were found to be under the other act when they did not think they were? Mr. McCOMB. No.

Mr. WERDEL. We do not have those figures?

Mr. McCOMB. Actually, your figures would not be any good because that, unfortunately, is a very common answer. When you find a man who is violating the act, his answer is always, "I didn't think I was subject to the act." Very many times he has had notices and been subject to it before.

Mr. WERDEL. The penalties under this act are the same as they were under the last act. In the first clause, section 16, on page 40, reads:

Any person who willfully violates any of the provisions of this section 15 shall, upon conviction thereof, be subject to a fine of not more than $10,000, or to imprisonment for not more than 6 months, or both.

Then there is the provision that nobody will be put in prison unless he has been convicted once before. How many criminal convictions have there been under the old act?

Mr. MCCOMB. Well, we can give that to you. It is quite small.
Mr. WERDEL. Will you supply those figures?

Mr. WEISS. We have them here.

Mr. McCoмB. At the present time, our figure would run about 40 or 50, maybe.

Mr. WERDEL. If you supply them to me, I assume we can put them in the record-the number of convictions under the previous act, criminal convictions.

Mr. WERDEL. Under subparagraph (b) of section 16, the language is

Any employer who violates

the word "willful" is left out

the provisions of section 6 or 7 of this act shall be liable to the employee or employees affected.

And then it goes on in substance that he will pay overtime or time and a half for hours over 40 hours a week, and then that difference would be doubled, and then a reasonable attorney's fee.

Mr. McCOMB. If the employees must sue; yes. If, on the other hand, he voluntarily pays out, he just pays his time and a half. In other words, he pays what the law requires him to pay in the first place.

Mr. WEISS. That is under a new proposal in this bill.

Mr. WERDEL. Yes; but under the old bill he had to pay the liquidated damages.

Mr. WEISS. Except the Portal Act made modifications in that. The judge could, under certain circumstances, reduce or eliminate the liquidated damages.

Mr. McCOMB. I do not know whether you want to pursue this, except I would like to make a statement, because it has not been questioned, and I think something should be said. That is the request here for the right of the Secretary to sue. We have had many employees ask us to sue. They are reluctant, as we all are, unless we are lawyers, to

get into a court. They do not want to go in-they do not want to get involved. They say, "Why don't you sue for me?"

The employer has found in many instances, I think, that his employees will not sue him, and he has refused to pay voluntarily. We have had a remarkable drop. We used to have voluntary payments from about 90 percent of those we found in violation. They are now down to 30 percent. The employer just does not pay. He knows that the employee probably will not sue him.

But the employee has that coming to him, and he should have it. It is very unfair to the competitor who voluntarily pays. Employer A voluntarily pays, and Employer B, across the street, does not pay, and he knows he can get away with it. Employer B may coerce and threaten his employees, and they will not sue him.

Mr. WERDEL. In the law, we always have the proposition that a man is presumed not to commit a crime, and presumably these men that you have approached have mistakenly thought that they were not under the act. Do you not agree with that?

Mr. McCOMB. Not as many as you would think mistakenly thought they were not under he act. Those are a very small percentage of the violations we have found, who have thought that they were not under the act.

Mr. WERDEL. In other words, you think that those that violated the previous act did it knowingly?

Mr. McCOMB. No. I thought you meant that a great many people were found in violation who thought they were not under the act. I say a very small percentage was found. Other types of violation, I mean, not paying the overtime, or not paying the minimum wage. Mr. WERDEL. Can you supply us the figures of the number of such persons who have been found in violation by your office and been requested to pay off?

Mr. WEISS. We have the figure of the number who have been found in violation, the number requested to pay up, and the amount collected. Mr. WERDEL. Will you supply those to us!

Mr. WEISS. Yes.

(The information referred to is as follows:)

Results of inspections under the Fair Labor Standards and Public Contracts Acts, 1939-48, by fiscal year