Special Message to the Congress on Labor-Management Relations.

To the Congress of the United States:

There are submitted herewith for the consideration of the Congress, recommendations for amendments to the Taft-Hartley Act and for additional legislation to provide greater protections for the rights of individual workers, the public, and management and unions, in labor-management relations.

I.

No labor-management relations legislative program today can ignore the disclosures of corruption, racketeering and abuse of trust and power in the labor-management field. Many of these disclosures have been made in Congressional hearings and in investigations by grand juries and local law enforcement agencies. In the various States vigilant attention by law enforcement officials, and public interest in the effective enforcement of existing laws against criminal activity, are doing much to eliminate many of the evils and abuses which have occurred. Union officials--most of whom are decent, honest Americans--are also doing much to eliminate the few in the ranks of organized labor who are corrupt. However, the importance to American workers and to the public of preventing the impairment of the individual rights of employees and the fact that voluntary action is inadequate in this respect have become increasingly evident. In order to protect the basic rights of the individual worker and to maintain the integrity of trade unionism itself, action on the part of the Government is needed.

The American public is in need of reassurance:

1. That the funds which are set aside for the benefit of working men and women in health, welfare and pension plans are accounted for.

2. That the monies which are contributed by workers to union treasuries are being used solely to advance their welfare.

3. That organizations in which working people associate together voluntarily to improve their status through collective action will be administered in such fashion as to reflect their will.

4. That working people are more fully protected from dealings between representatives of labor and management which have the effect of preventing the full exercise of their rights to organize and bargain collectively.

5. That the public is protected against unfair labor and management practices within the collective bargaining relationship which give rise to the exercise of coercive power by one as against the other tending to impede the peaceful development of that relationship, or which infringe the legitimate rights of innocent third parties.

The Secretary of Labor has recommended to me a comprehensive program of legislation which, if enacted, will, I believe, give that reassurance to the American public. His recommendations constitute the program of this Administration in the labor-management field, and the Administration urges the Congress to enact legislation:

1. To require the registration and detailed annual reporting to the Department of Labor, with appropriate disclosure, of all plans which provide health, welfare or pension benefits to working men and women, whether administered by employers, by unions, or jointly by both. The Administration made specific legislative recommendations in this respect in 1956 and 1957.

2. To require:

a. That all labor organizations, having members employed in industries affecting commerce or which receive benefits of tax exemption under the Internal Revenue Code, including regional and local conferences and councils, shall:

(1) File with the Department of Labor detailed annual financial reports, which shall be available for public examination.

(2) Maintain proper financial books and records open to the scrutiny of all of their members.

b. That officers of such labor organizations who handle union funds be held to the highest degree of responsibility for the funds committed to their care by union members; and that the members of such organizations be given an unequivocal right to sue in Federal or State courts to enforce these responsibilities. This would not supersede existing State statutes or judicial remedies.

3. To require that all labor organizations:

a. File annually with the Department of Labor detailed information as to their constitutions, by-laws, and organizational structure, and procedures.

b. Show by appropriate reporting that their members have the right and opportunity to elect and have elected at intervals of not more than four years, their local officers directly by secret ballot, and their national officers either directly by secret ballot, or through delegate bodies elected directly by the membership by secret ballot, with due notice of any election being given to the members. The Department of Labor would be authorized to make full public disclosure of these reports.

4. To require:

a. That all employers report to the Department of Labor all financial dealings with labor organizations or their representatives either directly or through a third party, but exempting those employer payments specifically authorized by law or reported under other requirements of law; to require that all labor organizations and representatives of labor organizations report to the Department of Labor all such financial dealings with employers either directly or through a third party; and to authorize the Department of Labor to make full public disclosure of these reports.

b. To prohibit by the application of appropriate civil and criminal laws financial dealings between employers and labor unions which operate to impair the fights of working people to organize, to select their bargaining representative or effectively to bargain collectively; specifically to amend the Taft-Hartley Act to prohibit payments made to employee representatives by employer agents or representatives, as well as those made directly by employers, except as authorized by law; to cover employer payments to an employee representative other than a representative of his employees; to prohibit payments over and above payments for regular job duties made by an employer, his agent or representative to an employee or group or committee of employees to influence other employees in the exercise of their right of self-organization or the selection of a bargaining representative; and to make it clear that employer payments to trust funds for apprenticeship and training purposes are not prohibited.

5. For effective administration of this program of reporting and disclosure of general union funds, conflicts of interest, union organization and structure and also the program for reporting and disclosure of welfare and pension plans, the Administration recommends that there be created in the Department of Labor a Commissioner of Labor Reports who would be responsible to the Secretary for the performance of duties under the new legislation. The Commissioner should be appointed by the President with the advice and consent of the Senate. In the administration of these reporting requirements, the Commissioner of Labor Reports would be empowered through authority derived from the Secretary of Labor to:

a. Make full public disclosure of all information contained in the reports;

b. Seek injunctions against violations ;

c. Investigate reports of violations of the reporting requirements, including the accuracy of reports filed, and charges that union election or procedural practices are not in accordance with the reporting requirements; and

d. Issue subpoenas for the production of all appropriate books and records and compel testimony by witnesses.

6. In order to ensure the effective enforcement of this program, the Administration recommends that the following criminal and administrative sanctions be enacted into law: a. Criminal

(1) The embezzlement of general union funds, false statements or entries, or wilful destruction of books should be made punishable as a felony.

(2) The Criminal Code provisions relating to filing of false information should be made specifically applicable to these reports.

(3) The failure of an employer or a union to file required reports should be made a misdemeanor.

(4) A new bribery section should be added to the Criminal Code making it a felony for an employer, or his agent or representative, or any union official or representative, to make or receive any payments to influence improperly the actions of the other in labor-management matters. To facilitate prosecutions of violations of this section there should be included a provision for immunity to witnesses.

b. Administrative

At the present time any labor organization covered by the National Labor Relations Act is denied access to its processes if it fails to file financial and organizational reports. This should be continued. In addition, subject to the requirements of the Administrative Procedure Act, including judicial review, for the wilful failure to file true and proper reports the Administration recommends that:

(1) All labor organizations and employers be denied all rights or privileges available to them under Federal labor management relations laws;

(2) All labor organizations be liable to revocation of any outstanding certification as bargaining representative under any law of the United States;

(3) All labor organizations be liable to the forfeiture for an appropriate period of tax exemptions available to them under the Internal Revenue Code.

7. Certain provisions of the National Labor Relations Act afford opportunity for labor or management to coerce the other, often with detrimental effect on individual employees, innocent third parties and the general public. The Administration recommends that the ambiguities and inequities that exist in these provisions be removed by amending them as follows:

a. Amend the secondary boycott provisions of the Act to make it clear that they prevent: Direct coercion of an employer to cease doing business with another;

Coercion of employers by inducement or encouragement of individual employees to refuse to perform services;

Coercion of secondary employers who do not come within the Act's definition of "employer"; and

Coercion of employers to enter into or to enforce agreements to cease using the products of, or to cease doing business with, another person.

To further amend the secondary boycott provisions to make it clear that they do not prevent:

Activity against a secondary employer who is performing "farmed out" work in behalf of a struck employer; or

Activity against secondary employers engaged in work on a construction project with the primary employer.

b. Amend the Act to make it an unfair labor practice for a union, by picketing, to coerce an employer to recognize it as the bargaining representative of his employees or his employees to accept or designate it as their representative where:

The employer has recognized in accordance with law another labor organization:

The employees, within the last preceding twelve months, have rejected the union in a representative election; or

It is otherwise clear that the employees do not desire the union as their bargaining representative.

c. Amend the Act to eliminate the statutory prohibition which bars economic strikers who are not entitled to reinstatement from voting in representation elections.

II

In addition to the above the Administration recommends that several other changes be made in the Labor-Management Relations Act of 1947. Some of these changes have been proposed before, some are new, but all are intended to strengthen and improve the Act where experience has shown that correction is needed. These proposals are as follows:

1. Amend the Act to eliminate the jurisdictional gap referred to in recent Supreme Court decisions by authorizing the States to act with respect to matters over which the National Labor Relations Board declines to assert jurisdiction.

2. Amend the Act to authorize the Board, under appropriate circumstances, to certify as bargaining representatives, without a prior election, unions acting in behalf of employees primarily engaged in the building and construction industry.

3. In view of the enactment of the Communist Control Act of 1954, amend the Act to eliminate the provision requiring the filing of non-Communist affidavits by officers of unions seeking to use the Act's processes.

4. Amend the Act so that parties to a valid collective bargaining agreement may not be required to negotiate during the life of the agreement unless it provides for reopening or the parties mutually agree to its being reopened.

5. Amend the Act to make it clear that when the office of the General Counsel becomes vacant the President may designate some other officer or employee to serve as acting general counsel during the vacancy.

These legislative recommendations are designed to benefit and protect the welfare of American workers and the general public, to curb abuses, and to provide greater harmony and stability in labor-management relations. They take into consideration the fundamental principle that an effective right to organize and bargain collectively is an essential part of this Nation's free and democratic society.

I urge that the Congress give speedy consideration to these proposals.

DWIGHT D. EISENHOWER