Scattered Cats

Western Union Telegraph Co. last week announced that it might have to fire 3,125 messenger boys. Luther Wallin, of Earle, Ark., prudently closed down his sawmills there and at Columbus, Miss. In low-wage Puerto Rico, employers planned to lay off 120,000 of the island's 420,000 workers, hiking the numbers of unemployed to 350,000. Thus did the nether ends of industry fit themselves last week to the second attempt of the New Deal to put "a floor for wages, a ceiling for hours." Into effect at 12:01 a.m., October 24, went the Federal Fair Labor Standards Act of 1938.

At that moment it became illegal to pay some 11,000,000 workers employed in interstate commerce less than 25-c- an hour. The statutory work week became 44 hours. It was not illegal to work a longer week; it-was simply more expensive for employers, who thereafter would have to pay 1 1/2 the regular rate for overtime. Big Western Union and little Southern lumbermen sought to get in line by exemption or discharge of underpaid hands, or out of line by closure, because any employer found in violation will be in a peck of trouble. He may have to pay his workers the difference between their substandard wages and the legal minima, plus an equal amount in damages. And he may have to pay a fine up to $10,000, spend up to six months in jail.

Most U. S. employers were in no danger. Of the 11,000,000 employed in industries under the Act, U. S. statisticians last week figured that only 750,000 (a large proportion in Southern, lumber, garment, fertilizer industries) received less than 25-c- an hour. Twice as many, about 1,500,000 employes, work more than 44 hours. In future years the standards will grow stricter: beginning October 24, 1939 30-c- & 42 hours; October 1940 30-c- & 40 hours; October 1945 40-c- and 40 hours. Meantime, committees representing management, labor and the public may fix the wage minima actually applying to any industry anywhere between 30 and 40-c- (so long as the standards do not cause unemployment). Along with Wages & Hours goes Federal prohibition of Child Labor (under 16) in interstate commerce industries effective immediately and applying to 50,000 children.

Andrews Over Industry. Assigned to fit U. S. industry to this jacket is Wages & Hours Administrator Elmer F. Andrews, a deceptively mild man who as New York State Commissioner of Industry learned to slap with a gloved hand. On the fifth floor of the Labor Department Building in Washington last week, Elmer Andrews labored at his prodigious task with less than 100 helpers.

Last week Wages & Hours had received 45,000 inquiries from employers and workers who wanted to know whether they come under the standards, whether the U. S. has another NRA. Mr. Andrews made it clear that: 1) the Act resembles NRA in purpose, is wholly different in method. Chief difference: NRA standards were established and applied (with Federal supervision) by industry Code Authorities, whereas the bases for Wage & Hour standards are written into the statute.

Elmer Andrews is no fancier of dead cats. Nevertheless, in press conference and by radio last week, he spoke in a vein reminiscent of NRAdministrator Hugh Johnson of the "chiseling 10%." Having heard that some firms were closing down rather than comply, Mr. Andrews scented some scattered cats, snorted: "These suspensions . . . seem to have been timed ... to bring the law into disrepute. . . . It must be plainly understood . . . that the Fair Labor Standards Act is the law of the land. . . . The Wage and Hour Division will enforce the act uniformly, compellingly, with forbearance but without partiality."

Overtime Light. Having had time to digest the numerous exemptions (for agricultural workers, seamen, executives, out-side salesmen, local retail and service employes, etc.) written into the act itself, Industry & Labor looked to Mr. Andrews for light on terms, weasels, cloudy clauses which required definition and interpretation. Mr. Andrews and his staff worked much overtime to supply the enlightenment, explained it was to be taken at the customers' risk. (Only the courts may finally define.) Some of their interpretations :

>"Employes who are an essential part of the stream of interstate commerce are . . . included in the phrase 'engaged in commerce'; for example, employes of a ware house whose storage facilities are used in the interstate distribution of goods."

>"|The Act | applies typically, but not exclusively, to that large group of employes engaged in manufacturing, processing or distributing plants, a part of whose goods moves in commerce out of the State in which the plant is located. This is not limited to employes who are engaged in actual physical work on the product. . . . The benefits of the statute are extended to such employes as maintenance workers, watchmen, clerks, stenographers, messengers, all of whom must be considered as engaged in processes or occupations 'necessary to the production' of the goods.

>"The Act does not cover plants where the employes work on raw materials derived from within the State and where none of the product of the plant moves in interstate commerce. This is true, even though the product so manufactured and sold locally comes in competition with similar products which have been manufactured elsewhere and have been moved in interstate commerce."

>"The Act is not limited to employes working on an hourly wage. . . . What ever the basis on which the workers are paid . . . they must receive at least the equivalent of the minimum hourly rate."

>". . . Employment of learners, apprentices, handicapped persons and messengers at rates less than those required by ... the Fair Labor Standards Act . . . will be allowed only under special certificates issued by the Administrator."

>Exemption of workers handling, preparing or canning horticultural and agricultural products or making dairy products "within the area of production" applies to those employed directly on a farm, or at nearby plants having seven employes or less.

>Essence of the definition of an exempt "executive": he must have power to hire & fire, or a good deal to say about hiring & firing; he must receive $30 a week or more.

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