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SUBCOMMITTEE NO. 3 CONSIDERATION OF H.R. 3367, TO AMEND TITLE 10, UNITED STATES CODE, BY REPEALING SECTION 7474, WHICH GRANTS TO THE SECRETARY OF THE NAVY THE AUTHORITY TO ESTABLISH RATES OF WAGES FOR CERTAIN EMPLOYEES OF NAVAL ACTIVITIES

HOUSE OF REPRESENTATIVES,
COMMITTEE ON ARMED SERVICES,

SUBCOMMITTEE No. 3, Washington, D.C., Tuesday, February 17, 1959. The subcommittee met, pursuant to call, in room 304, House Office Building, at 10 a.m., Hon. L. Mendel Rivers (chairman of the subcommittee) presiding.

Mr. RIVERS. I will ask the committee to come to order.

This is our first meeting in the new Congress and the first meeting of the committee under my chairmanship.

I am sorry we don't have a larger membership this morning because of the importance of the bills to be considered.

The majority of the consideration of this committee will be on Reserve matters. I haven't had as intensive background as that of my distinguished ranking Republican member and the other members of the committee because of the fact I have been on another committee, Mr. Kilday's committee.

But with the help of the membership of the committee and the patience of the representatives of the Reserve organizations—National Guard and Reserve—we will do the best we can.

There is one thing you will see in this committee, though; you will see some decisions made, and fast. We are not going to work like sewing machines, we are going to have hearings and take action. With no reflection on the past chairman, because that is what he did, we will try to do as well as he did, if humanly possible.

The first bill scheduled for consideration this morning is H.R. 3367.' Without objection, H.R. 3367 will appear in the record at this point. (H.R. 3367 follows:)

A BILL To amend title 10, United States Code, by repealing section 7474, which grants to the Secretary of the Navy the authority to establish rates of wages for certain employees of naval activities * Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That chapter 643 of title 10, United States Code, is amended as follows:

(1) By repealing section 7474; and

(2) By striking out the following item in the analysis thereof: "7474. Wage rates : establishment,”

Mr. Rivers. This was introduced at the request of Mr. Vinson. This bill would authorize repeal of an existing section in title 10 of the United States Code which provides the Department of the Navy with authority to establish wage rates for unclassified employees at naval activities.

The Department of the Navy has indicated that this authority is unnecessary since similar authority is provided all Departments of 34066-59-No.q-1

(475)

the Federal Government under the provisions of section 202(7) of the Classification Act of 1949, as amended.

The Department of the Navy has therefore indicated that the existence of similar authority in respect to the Department of the Navy in section 7474 of title 10, United States Code, is undesirable since it can lead to inconsistent wage practices in scales within the Federal Government, particularly if either the exclusive naval authority or the general wage authority of the Federal Government were amended independently.

Subsequent to the scheduling of this bill I have been advised by various representatives of employees at naval activities that they are opposed to this repeal of section 7474 of title 10, United States Code.

In view of this development I feel that the hearings on H.R. 3367 should clearly explore all opposition views for the purpose of determining whether in fact the bill is desirable and in the public interest.

Our first witness is to be Admiral Cronin, but I will ask you to allow our distinguished colleague to appear.

Mr. VAN ZANDT. Mr. Chairman, may I ask a question at this point. How does this piece of legislation fit into the roles and missions of this subcommittee? I thought this was a subcommittee on Reserve matters.

Mr. SMART. Not exclusively.

Mr. RIVERS. He gave Mr. Brooks exclusive authority on Reserve and National Guard, I believe, and Mr. Vinson tells me that all the committees have concurrent jurisdiction.

It would have suited me just as well if Mr. Vinson introduced this bill instead of putting it in in my name.

I said in my statement there is some opposition from the Naval Establishment, and I can tell you there is plenty down in my district. I have enough wires here to cover my desk.

Mr. VAN ZANDT. There are some of us who have no Navy yards.

Mr. RIVERS. Mr. Miller, we will hear from you and we are very glad to have you testify.

STATEMENT OF HON. GEORGE MILLER, A REPRESENTATIVE IN

CONGRESS FROM THE STATE OF CALIFORNIA Mr. MILLER. I appear here in opposition to H.R. 3367. I would be reluctant to come before this committee and oppose a bill the dis tinguished chairman has introduced, but I know the method by which the bill was introduced and I know it does not reflect his own feelings in the matter.

This bill would repeal section 7474, title 10 of the code, and the basic law that has been in effect before any man here was in Congress.

Mr. RIVERS. 1862.

Mr. MILLER. It is the cornerstone on which the wage board legislation is based. You could repeal other sections—they say “This is covered by another law,” but certainly this law which has given protection and which has been the basis by which the Navy has employed its blue-collar people all of these years, is sort of the Magna Carta or the Declaration of Independence, on which labor stands.

Mr. VAN ZANDT. What do you mean by "blue collar”?

Mr. MILLER. The wage board employees are quite frequently referred to as “the blue-collar employees," as opposed to white-collar employees, who are administrative employees.

Mr. Rivers. Per diem employees.
Mr. MILLER. They are per diem employees.

Mr. VAN ZANDT. In other words, the term “blue collar" is used here the same as you would use it under civil service?

Mr. MILLER. Yes. It has always been referred to as wage board employees, per diem employees or blue-collar employees. It is a colloquialism which explains who these peope are.

This is the basis, and the very fact that we come in here trying to repeal this law disturbs these very faithful employees, who feel that their salary structure is guaranteed under it, and I can't understand the Navy comes before this committee, and two came before it when I was here, committee after committee, pleading, telling you what they have to do to build up morale in organizations in the Navy.

I am not going to limit it to the Navy: to the three Departments of the Department of Defense.

And then they come in because someone conceives something like this that has cost and will cost in the lack of morale within the shipyards and naval establishments and naval air stations enough of lost time, because this thing comes in here that costs us hundreds of thousands of dollars in lost time the chattering that takes place.

The time off within every naval establishment in the country when this bill was brought in has cost us already hundreds of thousands of dollars in lost time, and when they talk about morale in the armed services I sometimes think they ought to sit back and take a little look at those things that go to make for morale.

I want to vigorously oppose this bill, Mr. Chairman, because I feel that it is not in the best interests of defense. If the legislation is covered in other places, this thing certainly isn't doing any harm as a vestige of another area.

I have weighed very carefully what I have said, and I suggest that the bill not be acted on favorably.

Mr. RIVERs. Has anyone any questions of Mr. Miller?
Thank you very much, Mr. Miller.
Admiral Cronin, we will be pleased to have your testimony.

Give your name and title to the reporter, please, Admiral, and you can make your statement, and then after you have finished we will ask questions. Admiral CRONIN. Thank you, Mr. Chairman.

I have a very short statement, Mr. Chairman, if I may read it. STATEMENT OF REAR ADM. R. E. CRONIN, USN, ACCOMPANIED BY

THOMAS L. GARDNER, DIRECTOR OF WAGE AND CLASSIFICATION-INDUSTRIAL RELATIONS

Admiral CRONIN. I am Rear Adm. R. E. Cronin, USN, Chief of Industrial Relations of the Department of the Navy and I'have been designated to represent the Department of Defense at today's hearing on H.R. 3367.

With me is Mr. Thomas L. Gardner, who is Director of Wage and Classification for the Office of Industrial Relations. The Department appreciates the opportunity to present its views on this bill

. The intent of the bill is to repeal that portion of Public Law 1028, 84th Congress, 2d session which includes the following statement for the wage-fixing authority of the Secretary of the Navy:

The Secretary of the Navy shall establish rates of wages for employees of each naval activity where the rates are not established by other provisions of law to conform, as nearly as is consistent with the public interest, with those of private establishments in the immediate vicinity.

The Department of Defense strongly supports H.R. 3367, since the need for separate wage-fixing legislation for the Navy no longer exists.

Section 202(7) of the Classification Act of 1949 provides almost identical authority and is used by other Federal agencies to set wages for ungraded Federal employees.

During the past few years efforts have been made by the military departments to bring their pay fixing systems and practices as closely in line as possible consistent with the needs of the respective departments.

The past two personnel advisors to the President have sponsored and even directed this action.

It appears inconsistent in the face of this intent and practice that the Department of the Navy should be set apart from the other military departments or other Federal agencies in the matter of legislation for pay of wage board employees. It becomes difficult to explain satisfactorily to interested parties why separate laws with almost duplicating effect continue on the books.

When the original law governing establishment of wages within the Navy was passed in July of 1862 (12 Stat. 587; 34 USC 505), it provided

That * * * the rates of wages of the employees in the Navy yards shall conform, as nearly as is consistent with the public interest, with those of private establishments in the immediate vicinity of the respective yards, to be determined by the commandants of the Navy yards, subject to the approval and revision of the Secretary of the Navy.

Recodification of that law under Public Law 1028 resulted in updating the format and content to that which I previously quoted.

There are two differences between the Navy law and the section 202(7) provisions. These differences are contained in the use of the words "private establishments” and “immediate vicinity,” in the Navy law.

In practice such differences have been inconsequential, for the most part, since the general practice of agencies has been to use wage data from private establishments almost entirely, and to follow the labormarket” concept, which is the "immediate vicinity” for all practical purposes.

One change which could result if the Navy were to use wage data from nonprivate sources would be to include laundry wage rate data from municipal and county institutions in order to obtain a more valid coverage.

In the San Francisco area, for example, laundry rates for the Army and Air Force have been somewhat higher than those of the Navy

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