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Chapter 29 of 943 · Business Tides: The Newsweek Era of Henry Hazlitt by Henry Hazlitt

The New Labor Law

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June 30, 1947

It is not surprising that union officialdom should have fought with every weapon in its armory against what it unscrupulously tagged the Taft-Hartley Slave Labor Bill. The new law is not perfect. It retains some mischievous provisions from the old Wagner Act. It includes several provisions which may prove difficult to enforce. But it represents nonetheless an immense step forward. As compared with the last dozen years, the whole climate in which labor negotiations are conducted will now be profoundly improved.

Where the Wagner Act started off with the falsehood that only the transgressions of employers burden or obstruct commerce, the new act from the beginning is two-sided. It declares that neither labor nor management has a right to engage in “practices which jeopardize the public health, safety, or interest.” The new law defines foremen, and exempts employers from the legal obligation to bargain collectively with them, so clearly that not even the National Labor Relations Board or the Supreme Court majority can “interpret” the provisions away. It makes the general counsel of the new five-man NLRB a direct appointee of the President instead of a creature of the board. This should make the counsel independent and help to separate the board’s prosecuting from its judicial functions.

The new law removes the Wagner Act’s specific endorsement of the closed shop. It sanctions only the union shop, provided the union itself is “open.” It authorizes the checkoff only on the written agreement of each employee affected. For the first time the new law makes it an unfair labor practice not only for an employer, but for a union, to “restrain or coerce” employees in the exercise of their bargaining rights. The new law illegalizes the secondary boycott. It illegalizes “excessive or discriminatory” initiation fees. It restores freedom of speech to the employer when his expression of opinion contains “no threat of reprisal or promise of benefit.” The new law makes collective bargaining for the first time a “mutual obligation” of employers and unions. The new law makes it clear for the first time that the obligation to bargain “does not compel either party to agree to a proposal or require the making of a concession.” The new law holds both parties to a collective bargaining contract. It requires a 60-day notice on either side before the termination of an existing contract. It deprives any employee who strikes within this 60-day period of his status as an employee under the act unless his employer willingly takes him back. The new act allows an employer as well as a union to petition for a bargaining election. It withholds recognition from unions that refuse to file statements revealing officers’ salaries, methods of election, initiation fees and dues, qualifications for membership and grounds for expulsion, and audited financial statements. No union is given protection under the act whose officers refuse to file affidavits that they are not Communists.

Where the old Wagner Act declared that in proceedings before the NLRB “the rules of evidence prevailing in courts of law or equity shall not be controlling,” the new act just as specifically requires that such proceedings “shall, so far as practicable, be conducted in accordance with the rules of evidence applicable in the district courts of the United States.” Where the Wagner Act held that in court appeals the findings of the NLRB as to the facts should be conclusive “if supported by evidence,” the new act insists that they must be “supported by substantial evidence on the record considered as a whole.” These two procedural changes alone will make an immense improvement in the fairness with which labor relation cases are tried.

The new law repeats from the Wagner Act the provision that nothing in it shall be construed “so as either to interfere with or impede or diminish in any way the right to strike”; but this time it adds the significant provision “or to affect the limitations or qualifications on that right.”

This is by no means a complete list of the important changes. The new law does not guarantee labor peace. No law could. But it provides two-sided bargaining and should improve the whole atmosphere of labor relations.

Business Tides: The Newsweek Era of Henry Hazlitt

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