Mr. CASEY. I do.

Mr. KEARNS. That was by the American Federation of Labor.
Mr. CASEY. By the Building Trades Council; yes, sir.

Mr. KEARNS. There was a news release on that from the White House.

Mr. CASEY. There was, and it was made in Washington, and everybody agreed to it, but I will just tell you, my friend, for 75 years that the A. F. of L. have been in existence, they have put out many of those statements, and I want to find somebody living up to them.

Mr. KEARNS. You mentioned that you would be in favor of the appointment of a board of arbitration. I would take it from that that you believe in compulsory arbitration.

Mr. CASEY. Right, sir.

Mr. KEARNS. That is all, Mr. Casey.

Mr. MCCANN. You are subject to recall if we need you this summer, when you feel better.

Mr. CASEY. You can't call on me any time that I will feel any better than I do today.

Mr. MCCANN. Mr. Chadwick.

TESTIMONY OF ISAAC E. CHADWICK, PRESIDENT, INDEPENDENT MOTION PICTURE PRODUCERS ASSOCIATION, LOS ANGELES, CALIF.

(The witness was duly sworn.)

Mr. MCCANN. Will you state your name and your address, please? Mr. CHADWICK. Isaac E. Chadwick, 738 South Irola, Los Angeles. Mr. MCCANN. What is your business or occupation?

Mr. CHADWICK. I am a producer of motion pictures, and I am president of the Independent Motion Picture Producers Association. Mr. MCCANN. How long have you been in the motion-picture business?

Mr. CHADWICK. Thirty-seven years.

Mr. MCCANN. Do you have any problems in that business?
Mr. CHADWICK. Many and varied.

Mr. MCCANN. Would you mind telling this committee, which is out here for the purpose of trying to aid you in such labor-relations problems as you may have, that information which you feel should be of interest to us in a legislative way?

Mr. CHADWICK. I will be glad to comply, but I would prefer specific questions.

Mr. MCCANN. You would prefer specific questions. Do you have any "featherbedding"?

Mr. CHADWICK. The members of our association have considerablę "featherbedding."

Mr. MCCANN. Would you give us instances and facts with respect to that and what unions are involved?

Mr. CHADWICK. If you don't mind, I must first sketch a little background for you.

Mr. MCCANN. All right, glad to have it.

would

Mr. CHADWICK. The members of our association are what you call in any other business the small businessmen. In other words, we are not the major producers; we are the smaller producers, who make

from 1 picture up to, say, 25 pictures. There are 29 members in our association, and the greater proportion of our production consists of what we know in the trade as the small westerns or action pictures. The market for them is extremely limited and the only way in which production can proceed is by strict economy, adherence to the budgets which are necessarily limited, and by the employment only of such men as are actually essential to complete the job. So that let's take on— there are many phases and I will take them up one at a time. In music, for example, a small western made at the average budget of approximately $30,000 for that type of picture, up to last year would employ for scoring, as it is known-that is the background music which accompanies the picture-would employ eight musicians on the average for a session of 3 hours. That would cost your small producer approximately eight times $30 in wages for the eight musicians. I am talking now up to the time of September 1, 1946. Under a contract which the American Federation of Musicians negotiated with the major producers, that is, the Motion Picture Association, of which Mr. Casey, who has just testified, is the committee representative, the individual companies either had the choice of engaging an orchestra of at least 20 men on a permanent basis or a minimum of 2 years of annual salary, whether they worked or not, or the individual producer who could not engage a permanent orchestra of that size on an annual basis because he only made one picture or a few pictures and only had 3, 6, or 9 hours' work in the entire year, he had the option of engaging a minimum of 50 men for an orchestra at double the scale. In other words, the scale now became $13.33 for the average manthat is the ordinary musician-and the leader usually had a higher scale. In the case of the single picture industry engagement of 50 men the scale was $25 an hour, with a minimum of 3 hours. So that that western picture which formerly must meet a wage scale of a minimum of $240 became a minimum under that rule of $3,750. That, of course, it was impossible for that man to pay. It was entirely out of reason. He didn't need those 50 men, and he didn't need an average of 20 men. Therefore, with that condition, it precluded the usual small producers, and we showed these facts and the local, that is, the union, agreed to allow us to make a contract for the orchestra of 20 men and a leader on an annual basis, under which we agreed to pay each of the men a weekly salary, that is, annual salary of approximately $6,900 per man, with the same minimum for the major studios, plus whatever agreement we make with the orchestra leader, who is the concertmaster, as he is known. For that we were permitted to use the the orchestra for a total 52 times 10 hours, that is 520 hours, and they are to get 54 weeks' pay for a 52-week year for the reason that even though they were given a lot of vacations during the year in which they were paid, we still have to pay 2 weeks for the vacation, so that we actually pay them 54 weeks' salary for a 52-week year, pay for the 20 men, and are doing it now. However, in the majority of our companies they can't afford it, and we would not use the orchestra for 520 hours, but we are paying for the 20 men and we are paying for the 520 hours, while we will use approximately 300 hours of their services. Therefore, if you consider "featherbedding" to the extent of 220 hours, "featherbedding" does exist in that branch. I have always maintained that on our smaller western pictures, where normally 8 men would be employed, that the use of the additional musicians imposes

upon the producer "featherbedding" to the extent of everything over 8, or practically 13 men.

Mr. MCCANN. May I ask a question right there? I you were free to determine the number of men that you would use, is it true you would only employ 8 men rather than 20?

Mr. CHADWICK. We would only employ eight men in the orchestra. Mr. MCCANN. Do you have any choice at all with respect to the number that you want to have, or do they tell you you must have 20 men and leader?

Mr. CHADWICK. They tell us that we must have that number; yes, sir. Mr. MCCANN. Proceed.

Mr. CHADWICK. Then there is one of the other items of expense that I ought to tell you, the other part in my impression which would be "featherbedding," that with respect to these surplus hours for which we pay we get no credit for surplus men that we hire outside of the men who apply to our total obligation under the contract. The result is that every one of our members is going to have to pay a substantial deficit for unused music during the year, which will, in my opinion, amount to approximately 200 hours at $13.33 per hour for 21 men. I haven't got the mathematics for it, of just what it would be; however, we have that problem. I will admit that as far as our industry is concerned, the contract that we have is as lenient as any in the industry, but, in my opinion, every contract in the industry compels the employer to hire the number of men for the number of hours determined, not by the employer but by the representative of the musicians union. I will admit our contracts have been following close to the contracts with the major studios represented by Mr. Casey here, who preceded me on the stand, only aggravated in our instance because we do not have the resources to carry on any such scale of expenses as applies to the major studios.

Secondly, we have had imposed upon us in the trades surplus men, men that we don't want, and are employing men who are incompetent to do the work, because a certain portion of the work is that done by those in this jurisdictional dispute.

Mr. KEARNS. Mr. Casey has so fully described that that I don't believe you need go into it.

Mr. CHADWICK. The situation does exist, growing out of the jurisdictional difficulties of the IATSE with the group known as the Conference of Studio Unions, which is composed of the carpenters and the painters and so on.

It is our custom during the progress of the negotiations between the major studios generally conducted by Mr. Casey in the past and his committee, we make what we know as interim agreements, upon the expiration of an agreement with a union, in which we specify that during the interim we will pay a specified wage rate, with the understanding stated in the contract that upon completion of the negotiations by the major studios with the unions we will adopt that contract as our contract and sign it. We do that so that we will know what our production costs will be, and we set up in the interim agreement an interim wage scale, whereas the major studios' practice is to agree to make a wage scale adopted in the future retroactive to something that has been paid in the past. We find that extremely pertinent, for the simple reason that if it should be made retroactive to be paid after

ward, that some of the men in the business might not have the resources to set up any fund to meet it, and if the retroactive payments became much greater than the amount they had estimated, they would have to pay it or they were forced out of business. Of our membership of 29, approximately 8 this year have been put out of business. This has also caused a great lessening of the production and a consequent increase in unemployment, because as these demands increase, the smaller companies are eliminated by reason of the fact that they could not afford to pay the same wage that the major studios do, and when a producer is eliminated all the people he employed are eliminated from employment.

Mr. MCCANN. May I ask a question? It appears then that there is no bargaining collectively between the small producers and the unions, but a period of stagnation or of suspended animation while the major studios carry on the bargaining and determine upon the contract to be made by the union.

Mr. CHADWICK. In actual fact that is so. We go through the forms. Mr. KEARNS. You go through the forms?

Mr. CHADWICK. We go through the motions.

Mr. KEARNS. And you agree with your unions that you will have to wait and see what the major studios do?

Mr. CHADWICK. We know we will have to take the contract made by the major studios, because they won't work for us unless we do take the same wages and the same conditions.

Mr. MCCANN. May I ask this question: Is there any relationship between the earnings of the studios and the pay scale of the employees? Mr. CHADWICK. None whatever.

Mr. MCCANN. In other words, in your business numerous studios have been put out of commission and have folded up because the wage scale which has been forced upon them has been such a serious burden that they could not operate.

Mr. CHADWICK. Actually that is only one of the factors-there are other factors, but the result did occur and has occurred to approximately 15 of our members; and to the elimination of 150 pictures which are not now being produced.

Mr. MCCANN. We would like to give a great deal more time to you, but you know the chairman has a call and he has to report down there, and it is necessary to shorten this hearing, but we are going to call you back; we want to have the benefit of what have been your experiences in the wage situation, and I want to ask you this: In your studio do you have people standing around drawing pay checks who do not do anything for the picture?

Mr. CHADWICK. Yes.

Mr. MCCANN. Tell us about it.

Mr. CHADWICK. I don't want to repeat the questions of musicians

now.

Mr. MCCANN. Just leave that go and tell us whatever else you have. Mr. CHADWICK. In our western pictures we don't need a camera crew of four. I want to differ with Mr. Casey in that connection. The union contracts tell us how many men to have.

Mr. MCCANN. Possibly Mr. Casey might find that they have something similar in their organization.

Mr. CHADWICK. I will say this for Mr. Casey, that in their case the number required is the normal for them, so that they do not have the men who are not required.

Mr. MCCANN. I can understand that.

Mr. CHADWICK. In the making of a million-dollar picture you can require numerous cameramen, but in the making of a $15,000 western, we can get along very well with a cameraman and an assistant and a second assistant to do the work. In the bigger picture, especially a studio picture, we do need a director of photography. He is valuable, because the question of lighting the set is involved, while the little western, as you know, is made outdoors and God gives you the light or he refrains from giving it, but the cameraman can't do anything about it.

Mr. McCANN. He never refrains in California, so proceed.

Mr. CHADWICK. I want to say this, when they imposed upon us a director of photography in that type of picture, the small budget picture, it is a burden which the picture cannot stand. Every other group practically tells you how many men you can employ. Mr. MCCANN. All of the union groups?

Mr. CHADWICK. All of them-practically all I will say-not all of them; that would not be a fair statement; too many of them, however, for our health.

Mr. MCCANN. Would you give a little careful consideration, sir, to the various problems of your industry in the next 30 days, and be prepared to present a future and further statement to our committee when we return? We would like to keep you, I think, on ice for a while, because I think you have some valuable information. Mr. Chairman, I want to go on and call two or three others.

Mr. KEARNS. Yes; I was going to ask Mr. Chadwick about this matter of those negotiations with the musicians' union.

With whom did you have the deal setting up this minimum? Mr. CHADWICK. We invited to our meeting Mr. Gillette, Mr. Bagley, Mr. Wallace, and I don't remember that name, a Dutch name, I think the vice president of the local.

Mr. KEARNS. te Groen?

Mr. CHADWICK. te Groen. As I remember it, the four of them attended our meeting.

Mr. KEARNS. And the contract in effect now has the 20 men and leader and a minimum of $6,900 for a maximum of 520 hours?

Mr. CHADWICK. No; for a minimum of 520 hours, sir, plus 2 weeks vacation or 20 hours' vacation pay.

Mr. KEARNS. Mr. Counsel, it would be very fine for Mr. Chadwick to go into this later, and when we arrange for the next hearing I hope we have ample time to really get to the bottom of this matter. I talked to Mr. Johnson concerning the picture studios, and it is an entirely different situation between the big operators in the movie industry and the smaller operators. I am very curious to get to the bottom of this thing and find out why the small businessmen can't be protected. They must be protected. That is all.

Mr. CHADWICK. Unless we get the protection, we are finished.
Mr. KEARNS. All right.

Mr. CHADWICK. Am I excused from further attendance?

Mr. MCCANN. You are excused until we notify you. We will call you, sir. Mr. Ray Young.