LABOR RELATIONS IN THE PETROLEUM INDUSTRY By Daniel Horowitz Under the Direction of Joseph Zisman, Acting Project Supervisor Prepared under the auspices of tho U. S. WORKS PROGRESS ADMINISTRATION 7 Sponsoring Agency — New York State Department of Labor Cooperating Agency — National Labor Relations Board Dr. David J. Saposs, Chief Economist Official Project No. 465-97-3-7 Works Progress No. 1040 New York, 1937. L L , 5^. Second Edition New York, 1938 Reproduced by Project 465 - 97- 3-18 "BIBLIOGRAPHIES VND INDICES OF SPECIAL SUBJECTS" LABOR RELATIONS IN THE PETROLEUM INDUSTRY By Daniel Horowitz Under the Direction of Joseph Zisman, Acting Project Supervisor Prepared under the auspices of the U. S. WORKS PROGRESS ADMINISTRATION Sponsoring Agency—New York State Labor Department Cooperating Agency—National Labor Relations Board Dr. David J. Saposs, Chief Economist Official Project No. 465-97-3-7 Works Progress No. 1040 New York, 1937. CHAPTER I: EMPLOYMENT. IMAGES AND HOURS OF LA30R. Section I: EMPLOYMENT - GENERAL According to the estimate of the American Petroleum Institute published in 1934, the petroleum industry in all its branches, exclusive of marketing, gives direct employ¬ ment to a total of £78,000 workers. Of this total* 230,600 are engaged in actual operating occupations, while the re¬ maining 47,400 are employed in clerical capacities. The total annual payroll for these employes in 1934 was $425,080,000.1 Tne Institute estimated the average employment and the total payrolls in the various branches of the industry in 1934 to be as follows:" 1. American Petroleum Institute, American Petroleum Industry. 1935, p.176. 2. Idem. -2- Employment Payrolls Drilling and Production Division: Clerioal 21,500 $ 4b,040,000 Operating 129.500 182.570.000 Subtotal Ml J MS" r~155t"5I5l(5OT Pl^e Line Division: Clerical 3,300 6,979,000 Operating. . 21.000 30.148.000 Subtotal 24|S00 1 37j127,000 Refining Division: Clerical 22,600 48,328,000 Operating 80,100 111.015,000 Subtotal 102,700 1J 159,343,000 Grand Total 278.000 & 425.060,000 Because of the fact that petroleum products are for the most part marketed together v,'lth other commodities and services, only an approximate estimate of the total number of workers employed directly in marketing petroleum and petroleum products can be roade. The American Petroleum Institute made the following estimate of employment in the 3 marketing branch of the petroleum industry: Wholesale marketing employes of oil companies 147,900 Retail marketing employes of oil companies 86,700 Individual filling-station proprietors and their employees engaged directly in retailing petroleum products .307,200 Workers in gargages, stores, parking lots, way¬ side stands, etc. engaged partly in the sale of petroleum products.. 180,000 Total 721,800 The estimate of 147,900 employees working in the whole¬ sale marketing branch of the industry can be accepted as 3. Ibid: p.178. »3" being a fairly ucourute figure.4 Tlie retail marketing employment statistics, however, must be qualified considerably. A very large proportion of the employees listed as engaged partly in the sale of petroleum products cannot be held to owe their employment directly to the sale of petroleum products. The United States Bureau of Census .limits its estimate of employment in the retail distribution of petroleum products to employ¬ ees of filling stations.5 It calculated that in 1933 fill¬ ing station employees totaled 171,812 and that there were 6 156,451 filling station proprietors. As pointed out in another part of this study, a great proportion of the so- called individual proprietors are directly under the control of the large oil companies through lease and license or lease and agency agreements. These agreements are very frequently nothing more than convenient legal arrangements which the oil companies make with service station workers 7 for various reasons. The "individual proprietors" might then conceivably bo counted among the employees of the oil industry. 4. The U.S. Bureau of Census in Census of American Business 1955-T.holosale Distribution. Vol'. I, p.A-46, calculated that in 3933 the wholesale distribution of petroleum and its products' furnished omploynent to 108,979 full time and 5,372 part-time employees. The rise in employment during 1934 in the industry would bring this estimate close to the American Petroleum Institute figure, 5. U.S. Bureau of Census, Census of American Business. 1933 Retail Distribution. Vol.1,. p.A-9 statos that filling stations total only 40$ of retail gasoline outlets,. 6. Ibid. p.A-9, 7. See Section on Marketing, supra. -4- Tho Amoricon Petroloun Instituto, by including tho individual proprietors of pjt.oolino stations, and workers of rotail establishments engaged partly in the sale of petroleum produots, ooncludas that tho total employment in tho industry in 1934 wus 999,800 workers. If the part time classification of tho American Potroleum Instituto is omitted and the Buroau of Census total employment figures for retail distribution are substituted for the American Potroleum Instituto figures in that division, tho estimated total employment in tho potroleum industry would be between 600,000 and 750,000, depending upon whether "individual proprietors" of gasoline stations are counted as employees or not. H.K. Anderson, who served ns chairman of tho labor subcommittee of the Planning and Coordination Committee under the Petroleum Code Administration reported to tho National Industrial Recovery Board that tho total direct employment in the industry on May, 1934 was 868,000 persons and that an additional 250,000 to 300,000 were employod to handle petroleum products in business establishments of Q othor types. The long tino trond of the development of the petrol¬ eum industry is revoalud by tho following history of employ¬ ment and total payrolls in the refining branch of the in- 9 dustry: 8. Oil and Gas Journal. Fob. 7, 1935, p.33. 9. Statistics for the yerrs, 1859-1889 aro from U.S. Buroau of Census, 31ennial Census of Manufacturers. 1921. p. 845. Statistics for 1899-1929 aro from Fifteenth Census of Manufactures, Vol. II, p.770; for 1931-1933, Eionnial UcnBUs or Manufactures. 1935,p.566; for 1935, Biennial -5- Numbor of Humbor of Year establishments wnna earners Total payroll 1859 78 i,m $ 556,000 1869 170 1,870 1,185,000 1879 86 9,869 4,382,000 1889 94 11,403 5,717,000 1899 67 12,199 6,717,087 1904 98 16,770 9,989,367 1909 147 13,929 9,830,078 1914 176 25,366 19,397,466 1919 320 58,889 89,749,637 1921 366 63,189 102,294,108 1923 382 66,717 103,833,760 1925 359 65,324 104,645,391 1927 354 71,234 113,716,705 1929 390 80,596 131,176,993 1931 376 68,824 107,474,000 1933 389 69,047 89,793,481 1935 397 77,402 109,714,355 1936 (10) (78,102) (117,165,283) (78,463) (116,779,294) 10. The Monthly L rib or Rovlow, March, IP 37, p. 740 gave an index of employment rnd payrolls in petroleum refining throufh 1936. The index, using as a base the years 1923- 1925, did not correspond exactly with the census figures given above for past years, the reason apparently being that the Bureau of Labor Statistics index is based upon a rather limited sampling within the industry. Consequent¬ ly, difficulties arose in applying the index to the census statistics in order to estimate 1936 employment and pay¬ rolls figures. The indexes by the Bureau of Labor Statis¬ tics for the period 1923-1936 were (three yorr average, 1923-1925 ■ 100): . Employment Payroll Employment Payroll Year Index Index Year Index Indox 1923 103.0 102.3 1930 124.9 130.4 1924 96.1 94.6 1931 106.2 105.8 1925 100.9 103.1 1932 96.7 87.5 1926 110.8 112.7 1933 106.5 88.4 1927 109.9 111.9 1934 118.3 100.3 1928 104.7 108.3 1935 116.7 105.6 1929 124.4 129.2 1936 118.3 112.4 Since the corrol ation between the index and the census statistics is not very close, two estimator * ' .re- attempted for 1936, For the first estimate shown in table, the Census statistics for the years 1923-1925 were used as the base, and the index for 1936 applied to that base in order to get the approximated figures. In the second estimate listed, however, 1935 was taken as the base and by applying the index change from 1935-1936 to the base, the second estimate."re- arrived -0- Seotlon II; VAGliS, HOURS OF LABOR AMD EMPLOYMENT BY 3RANCH OF INDUSTRY The information which vlll bo proscntod in this section was tr.lcon, for the most part, from a study mr.do by the Bureau of Labor Statistics in 1934 of wages, hours of labor and employment in the producing, pipeline and refin¬ ing branches of the industry.^"1 A brief description of the important occupations will be given for each branch of the industry, unless the occupations are self-explanatory. (1) Drilling and Production The process of drilling and operating oil wells has already been described in another section of this report. Following is a description, however, of the principal 13 occupations in this branch of the industry. 11. U.S. Bureau of Labor Statistics, Monthly Labor Review. July 1935, t>p. 13-37; Sort. 1935, ppT 5E>9-569Oct. 1935, pp. 087-903; Nov. 1935, pp. 1305-1319. 12. Soo surra "Production" in gonoral section on "Techno- logical Aspects of the Potroloum Industry". 13. Description of occupations given in "Wages and Hours of Labor in tho Petroleum Industry, 1920", Bureau of Labor Statistics, Bulletin 297. pp. 9-10. -7- Drlllors generally dlruot tho work, and control tho lovers operating tho drilling muohinory. These workers arc called or.blo drillers or rotr.ry drillers depending on whether a onble tool (percussion drill) or a rotary drill is used in the drilling. The cable tool is used in fields where considerable stone and rock formation is expected to bo encountered, while the rotary drill is used in oil fields where there is little or no stone or rock. The driller's first duty is, with the assistance of a tool dresser and some laborers, to locate and set up the boiler, engine and drill rig at a point where a well is to be drilled. He then directs the actual drilling of the well, the "shooting of the well" with nitroglycerine when oil is struck, and finally, its cleaning, to get it ready for piping and pump¬ ing. Drillers' heluers assist in making pipe and casing joints. They attach and remove drilling bits, etc. Tool dressers assist the drillers. Their duties are to act as firemen and run the engine used for power in drilling, to sharpen drills, help bail water from the well and do any other work required by the drillers. Rig builders erect the rigs on derricks used in drill¬ ing. Laborers and roustabouts help the pumpers repair boil¬ ers and engines, sst pumps or jacks and put in rod lines. They also dig ditches and act as general handymen on con- -8- struction and repaii* wcrk. Pumpers look after and keep in order the boilers, engines, pumps, eto. They inspect the pumps at intervals, oil the machinery, and r..tch that the tanks do not run over, Derrlckmen, employed only where rotary drilling is done, attach a cable from a position up in the derrick to pipes and casings and hold the upper end of the casing while it is being lowered into position and the connection is made. There are many other classifications of workers, such as teamsters, carpenters, machinists, engineers, oilers, tractor drivers, clean-out men, casers, etc. The average weekly wage in 1935, for all drilling and operating employees had been 028.73, and during 1936 it was $29,64. The average 1935 hourly rate of 77.9 cents had fallen to 76.9 cents during the 1936 period, but the in¬ crease in the number of hours worked por week from 36.0 to 38.4 had more than compensated for the hourly rate reduc¬ tion. 14. These figures were computed from statistics in month¬ ly issues of the U.S. Bureau of Labor Statistics, Month¬ ly Labor Review, section "Trend of Employment and Pay¬ rolls". The hourly rate statistics arc calculated by the Bureau from a smaller group of companies than are the weekly wage averages, so that the data is not completely comparable. Consequently if the hourly rate is multiplied by the number of hours worked per week, the result will not be the same figure as the average weekly wage estimate, although the figures will be quite close. 9- The following; table indicates the trend in weekly wages, hours of labor, wage rates and employment during the past few years, among the employees of producing and 15 drilling companies. Period Per capita Earnings Average hours Employ¬ weekly earnings per hour per week ment index May 1929 $34.00 $0,660 51.0 100.0 May 1933 25.00 .560 45.0 50.8 Nov. 1933 24.00 .740 33.0 72.2 May 1934 25.00 .770 33.0 78.1 Nov. 1934 27.72 .784 34.9 78.8 May 1935 28.48 .780 35.0 76.0 Nov. 1935 28.66 .787 36.5 73.0 May 1936 28.86 .767 38.1 72.5 Nov. 1936 30.49 .772 39.2 73.2 Dec. 1936 31.31 .768 40.3 72.4 This table indicates that the average wage rate in December 1936 was 76.8 cents per hour as compared with 66.0 cents in May 1929. Hours of labor during this period had fallen from 51 per week in May 1929 to 33.0 in the November 1933 to Hay 1934 period, but increased thereafter to 40.3 in December 1936. The average weekly wage fell during the depression from $34.00 to $24.00, but has been rising steadily since November 1933, and in December 1936 was $31.31. The greatest fluctuation during the depression took place in employment. The employment index dropped nearly 50$ from May 1929 to May 1933, and has since then fluctuated between 70 and 80$ of the 1929 level. 15, The statistics through May 1934 are from "Employment, Wages, and Hours of Labor in the Petroleum Industry, 1933-1934", Monthly Labor Review. July 1935, pp. 19-22. Subsequent statistics are from "Trend of Employment and Payrolls" in later issues of Monthly Labor Review. -10- Somewhat similar data for specifio producing states was gathered by the Bureau of Labor Statistics in its study of labor conditions in the petroleum industry in 16 1934. The table below is important in that it shows the wage and hour differentials in different states as well as the relative importance of these states as producing regions from the point of view of employment of labor. State or Region Per capita Earnings Average Emplo; and Period weekly per hour hours per nent earnings week N.Y. and Perm; May 1929 $27,00 $0.60 44 3,500 May 1933 21.00 .48 44 1,700 July 1934 24.00 .68 35 2,700 111.. Ind.. Mich. and Ou May 1929 26.00 .45 59 1,700 May 1933 23.00 .42 53 1,100 July 1934 25.00 .64 39 1,200 Kan; Kay 1929 29.00 .49 59 2,800 May 1933 21,00 .38 54 2,100 July 1934 24.00 .72 33 3,200 Kv. and W. Vau May 1929 22.00 .55 40 1,600 Hay 1933 19.00 .45 42 1,100 July 1934 21.00 .61 35 1,400 Ark; May 1929 32.00 .53 60 1,800 May 1933 22.00 .44 50 850 July 1934 25.00 .71 36 1,200 Laj May 1929 33.00 .54 61 3,1.00 May 1933 25.00 .55 46 2,400 July 1934 27.00 .82 33 4,800 Okla; ikly 1929 29.00 .55 51 22,000 May 1933 20.00 .45 44 10,000 July 1934 24.00 .74 32 16,000 16. Monthly Labor Review. July 1935, loc.cit.. pp. 27-28, State or Region and Period -11- (continued) Per capita Earnings weekly per hour earnings Average Employ- hours per mant week, (17) Tex.; "~Hay 1929 May 1933 July 1934 Colo..Mont, andn— N, May 1933 July 1934 Pay May 1929 May 1933 July 1934 $33.00 $0.60 55 15,000 30.00 .58 52 11,000 27.00 .81 54 21,000 Mex. ■ 29.00 .62 47 2,600 83.00 .54 43 1,400 27.00 .74 37 2,200 41.00 .87 47 26,000 28.00 .79 36 9,700 31.00 .86 37 13,000 The following enumeration of the distribution off drill¬ ing and production employees according to their weekly earn¬ ings in 1934 gives a more complete picture of actual weekly 18 pay among these workers than do the foregoing averages. It will be noticed that 27,9% of the workers earned less than $24.00 per week, that 26.9% earned between $24 and $28,00 and only approximately ten percent earned $40.00 or more per week. 17. The employment figures include only those covered by the Bureau study, estimated to be approximately 50% of total employees in oil fields, ibid, pp. 15 and 27, s 18, "Wages and Hours of Labor in the Drilling and Pro¬ duction Branch of the Petroleum Industry", Monthly Labor Review. October 1935, p. 901. -12- Sliaple percentage Cumulative par- Weekly earnings of employees oentage of employees, binder $8.00 3,2 3.2 $8 and under $16.00 4.9 8,1 $16 and under $20.00 5.9 14.0 $20 and under $24.00 13.9 27.9 $24 and under $28*00 26.9 54.8 $28 and under $32.00 18.6 73.4 $32 and under $36.00 10.7 84.1 $36 and under $40.00 5.8 89.9 $40 and under $48.00 5.6 95.5 $48 and over 4.5 100.0 The average earnings for all employees in drilling and production at that time was $28.22 per week.19 The average earnings in the important occupations Of the industry were $39.95 for cable drillers, $50.44 for rotary drillers, $29.70 for rotary drillers' helpers, $25.80 for pumpers, ?<»30.49 for rig builders, $22.45 for roustabouts and laborers, 20 $32,79 for tool dressers, and $26,81 for truck drivers. The distribution of the workers according to average hourly rates, as given below, indicates that 58$ of all employees earned between 67.5 and 87.5 cents per hour. The workers earning less than 57,5 cents per hour totaled 9.3 21 per cent while 9.6$ earned $1,00 or more per hour. 19. Ibid. ,p. 900. 20. Ibid, p. 902. 21. Ibid, p. 891. -13- Simple percentages Cumulative Average hourly earnings of employees percentage of emnloyees. Under 42,5 cents 1.3 1.3 42.5 and under 47.5 cents .9 2.2 47.5 and under 52.5 cents 4.5 6.7 52;5 and under 57.5 cents 2.6 9.3 57.5 and under 62.5 cents 5.3 14,6 62,5 and under 67.5 cents 7.7 22.3 67.5 and under 72.5 cents 11.1 33.4 72.5 and under 77.5 cents 23.1 56.5 77.5 and under 82.5 cents 13.4 69.9 82.5 and under 87.5 cents 10.4 80.3 82»5 and under 92.5 cents 5.3 85.6 92.5 and under $1.00 4.8 90.4 $1 and under $1.10 $1.10 and over 3,5 93.9 6.1 100.0 The length of the work day and work week in the oil fields has been reduced considerably during the past few years. In 1920, 74# of all oil field employees worked seven days a week, and 19# of these workers were on a twelve hour shift each day. Thus 14.1# of all workers were on the job eighty-four hours per week. A total of 45,2# worked sixty or more hours and 77.2# worked fifty six or more hours per 22 week. In 1928 the numbor of employees working 84 hours a week had increased; so that 23.2# of all workers were on the job for twelvo hours a day, savon days a week. The percentage of workers on a sixty or more hour week had in¬ creased to 51.9#. Yet tho percentage of workers employed for 56 hours, or less, per week had increased from 22.8# in 23 1920 to 45.2# in 1928. 22. U.S. Bureau of Labor Statistics, Bulletin No.297. op. cit.. p.4. 23. Computed from statistics in "Hours and Earnings of Saployoes in Oil Wells and Pipe Lines, 1928", Monthly Labor Review. March 1930, p.123, 14- Although It is usually neoeseary to keep the machinery in continuous oporation in both the drilling and mainten¬ ance of oil wells, the California oil fields in 19S8 had already inaugurated r. shift system whereby no employeo worked more than forty-eight hours a week. At this time, however, most onployoos in the oil fields in every district except in California wore working on an eight to twelve 24 hour shift for seven days a week. During the years after 1928 working hours were reduced considerably in all oil field districts. The reduction in hours is partly due to the depression and the consequent decrease in production. A very important factor in ex¬ plaining the reduction in hours during 1933 to 1935 was the provision in the Petroleum Code under the National Industrial Recovery Administration which set the maximum hours for any two weeks of work at seventy-two. The following table indicates the distribution of employees according to their average hours of employment in 1934.25 Weekly hours Simple percentage of employees Cumulative per- oentago of employees Under 16 hours 3.9 3.9 16 and under 32 hours 32 amd under 36 hours 36 and under 40 hours 40 and under 44 hours 44 hours and over 18.9 30.5 24.6 12.7 9.4 13.3 32.2 62.7 87.3 100.0 24. Ibid, p. 121. 25. Monthly Labor Review. October 1935, loc. cit., p.897. In 1934, then, 32.2$ of all oil fiold workers wore omployed less than 36 hours par week, 30.5$ wero working between 36 and forty hours and only 12.7$ forty-four hours or moro. (2) Pine Linos The functions performed by various classifications of , oc vrorkers In the laying and the operating of pipe lines ares Engineers and pumpers are responsible for the operation and care of the engines and pumps at the pumping station of the pipe linos. They also do the "firing" at smaller stations. Firemen are found only in the larger stations where the engineers and pumpers do not have time to do the "firing" They fire the boilers, watch the water gage, and oil the engine and pumps. Where gas Is used as a fuel, they are called engineer1s assistants. Gagers measure the oil in the tanks in the producing fields by first running off tho water vhich settles in the bottom of the oil tanks. Then, after measuring tho oil, they let it run Into gathering lines. Laborers and roustabouts are common laborers perform¬ ing unskilled work in the construction and repair of the pipe lines. Line walkers "walk the lines of pipes," looking for any 26. U.S. Bureau of Labor Statistics, Bulletin No. 297. op. cit. . pp. 12-14. . -16- . damage flood, fire, accident, etc., and report the trouble to the nearest station. There are many other occunatlonal groups employed on pipe lines, such as oilers, telegraphers, machinists, etc. The latest statistics available indicate that the average weekly earnings of all employees working on pipe 07 lines in 1934 was $27.44. The average hours worked per week during July 1934 was thirty-five, at a compensation 28 of 78 cents per hour. The following table indicates the trend in wages, wage rates, hours of labor and employment during the period of 1929 to 1934.29 Per capita Earnings Average hours Employment Period weekly earnings per hour per week index May 1929 $27.00 $0.54 50 100.0 May 1933 25.00 .55 45 59.0 Nov. 1933 24.00 .74 32 76.6 May 1934 25.00 .75 33 74.8 July 1934 27.00 .78 35 79.0 The differentials in wages and wage rates, as well as in average hours of work per week between various districts, as shown in table below, reveal that the California dis¬ trict pays the highest average weekly wage and the highest hourly rate. This is not only true for \vorkers on pipe lines, but, as has already been shown, for workers in the 30 oil fields of California, The average differentials 31 during 1934 for pipe line workers were: 27. "Wages and Hours of Labor in the Pipe Line Branch of the Petroleum Industry", Monthly Labor Review, Sept. 1935, p.569. 28. Monthly Labor Review, July 1935, loc. cit., pp. 19 and 22. 29. Ibid, pp. 19 and 22. 30. Supra, p. 11. 31. Monthly Labor Review. Sept, 1935, loc. cit., statistics from tables pp. 565, 568, and 569. -17- Per oapita Earnings Average hours District weekly earnings nor hour per week Arkansas and Louisiana.......... $27.07 $0,737 36.7 California.......... 28.82 .824 35.0 Illinois, Indiana and Ohio 28.75 .812 35.4 Iowa, Kansas, Minnesota and Missouri 26.77 .737 36.3 Kentucky and West Virginia 22.01 .652 33.8 Montana, New Mexico and \fyomlng 25.76 .742 34.7 New York and Pennsylvania 28.19 .812 34.7 Oklahoma 26.33 .748 35.2 Texas 28.60 .816 35.0 There is a relatively wide range among the differential wages of different occupational groups working on pipe lines. Common laborers received, in 1934, an average of $19.62 per week, while gagers and telegraph operators received $33.09 and $33.46 respectively, in weekly wages. The wages, wage rates and hours worked per week for the important occupa- 32 tions during the early part of 1934 are shown below. Occupation Per capita weekly earnings Earnings per hour Average hours per week Engineers $32.22 #0.890 36.2 Firemen 29.05 .816 35.6 Gagers 33.09 .909 36.4 Laborers 19.62 .545 36.0 Line walkers 29.63 .823 36.0 Oilers 30.49 .847 36.0 Roustabouts 24.12 .668 36.1 Telegraphers 33.46 .897 37.3 Truck drivers 29.94 .827 36.2 32. Ibid, pp. 561-562. -18- The distribution of all pipe line employees according to their weekly wages shows that 31.4$ earned less than $84.00 per week in 1934. The distribution table below, also reveals that 54.4$ or the majority of the workers earned between $24.00 and $36.00 in weekly wages and only 5.9$ of all employees earned $40.00 or more. A similar calculation of the distribution of employees according to hourly wage rates indicates that one-fourth of the workers earned less than 63.2 cents per hour, while another 25$ earned more than 90.7 cents. Slightly less than 10$ earned $1 or more per hour. The following table gives the distribution of workers by their average hourly Weekly earnings Simple percentage Cumulative percent- of workers age of workers Uhder $8.00. 3.5 7.5 8.4 12.0 15.6 22.4 16,4 8.3 5.0 .9 3.5 11.0 19.4 31.4 47.0 69.4 85.8 94.1 99.1 100.0 earnings• 34 33.. Ibid, p. 568. 34. Ibid, p. 563. -19- Simple percentage Cumulative per¬ Average hourly earnings of workers centage of workers Under 48.5 cents 2.7 2.7 42.5 and under 47.5 oents 1.9 4.6 47.5 and under 52.5 cents 8.3 12.9 52.5 and under 57,5 cents 4.5 17.4 57,5 and under 62.5 oents 6.9 24.3 62.5 and under 67.5 cents 4.9 29.2 67.5 and under 72.5 cents 6.2 35.4 72.5 and under 77,5 cents 10.5 45.9 77,5 and under 88.5 cents 9.0 54.9 82.5 and under 87.5 cents 13.0 67.9 87,5 and under 92.5 cents 11.1 79,0 92.5 and under $1.00 $1.6® and under $1.10 $1,10 and over 11.1 90.1 6.9 97.0 3.0 100,0 The weekly hours of work for all employees on pipe¬ lines during August 1934 averaged 35.4. The distribution of workers according to the length of their work week is as follows: Simple percentage Cumulative percent- l.eeklv hours of workers age of workers Under 16 3.3 3.3 16 and under 32 7.8 11.1 32 and under 36 14.4 25.5 36 and under 40 51.2 76.7 40 and under 44 18.1 94.8 44 and over 5.2 100.0 The table shows that 83.7$ of all employees worked between 32 and 44 hours per week. Practically all of the 18.1$ listed as working from 40 and under 44 hours worked 40 hours, so that more than three-fourths of the employees worked from 32 through 40 hours per week. The reason for this narrow distribution is the fact that the petroleum 35. Ibid, p. 567. 36. Ibid, p. 566. -20 oode under the National Industrial Kaoovery Administration, which was in effect in 1934, provided that, with few exceptions, operating employees should not work more than forty hours in one week or 72 in any two weeks. (3) Refining The average weekly earnings during the year 1936 for all refinery workers was $29.35, compared with $27.79, the average during 1935. The average hourly wage rate during this period increased from 79.9 cents to 82.7 cents, while the average hours worked per week increased from 35.0 to 37 35.7. While hourly earnings in 1936 were 29$ higher than they had been in Kay 1929, the average weekly income of the workers was still 5.3$ below the 1929 earnings. The following table shows the general trend in weekly earn¬ ings, hourly wage rates, hours of labor and employment, 38 in refineries: 37. Figures wore calculated from statistics in relevant issues (two and three months after date) of the Monthly Labor Review, "Trend of Employment and Payrolls". For explanation, supra note 14. 38. The statistics through Kay 1934 are from "Employment, Wages and Hours of Labor in the Petroleum Industry," op. clt., pp. 19 and 22. Subsequent statistics are from "Trend of Employment and Payrolls", in the corresponding issues of the Monthly Labor Review. -21- Per capita Earnings Average Employment Period weekly earnings por hour hours per index 19 23- week 1925-100 liny 1929 $31.00 $0,640 49.0 124.4 (39) May 1933 25.00 .600 41.0 89.5 (39) Nov. 1933 24.00 .700 35.0 104.3 (39) May 1934 26.00 .740 35.0 109.5 Nov. 1934 26.08 .762 34.3 111.9 May 1935 27.36 .709 34.9 108,3 Nov, 1935 27.60 .805 34.5 110.3 May 1936 29.17 .810 36.3 109.4 Nov. 1936 30.43 .839 36.5 119.5 Doc. 1936 30.95 .857 36.5 120.6 The wage differentio.ls by districts, given bolow for 1934, indicate that West Virginia and Kentucky refineries pay the lowest rates as v;oll as weekly wages. Their average weekly wage of 022.06 and average hourly rate of 63 cents is considerably lower than the 029.22 paid by Nov/ Jersey re- 40 fineries at an average of an hourly rate of 82.6 cents. Per capita Earnings Average State or region weekly earnings per hour hours per week Arkansas and Louisiana $26, .23 $0,736 35, .7 California 27, .55 .770 35. ,8 Colorado, Montana, New Mexico, Utah and Wyoming 28. ,49 .783 36, .4 Georgia, Maryland, South Carolina and Virginia 25, ,52 .743 34. .3 Illinois and Indiana 26, .17 .761 34. .4 Kansas and Missouri 25. .71 .739 34. ,8 Kentucky and West Virginia. Massachusetts and Rhode Island 22, ,66 .630 36, .0 28. ,21 .741 37. ,0 Michigan and Ohio 27-739' .783 36. ,0 New Jersey. 29. ,22 .826 35, ,4 New York 26. ,35 .734 35. ,9 Oklahoma 25. ,87 .728 35. ,5 Pennsylvania. 25. ,69 .747 35. ,8 Texas 25. ,27 .704 35. ,9 39. These index numbers wore converted from 1929 base, as given in Monthly Labor Review, July 1935, loc. cit.. p.19, to the 1923-1925 base used in the later index 'figures. 40. "Wages and Hours of Labor in Petroleum Refineries," Monthly Labor Review, Nov. 1935, pp. 1311, 1316, and 1318. -22- Average weekly wagos for different occupational groups working in petroleum reflnoriot vary considerably. Wiile common laborers woro paid an average wage of $19.03 at a rate of 54.6 cents per hour, crooking stillmen nvoragod $35.21 por week at an hourly rate of 98.1 conts in 1934. The table below indicates the differentials for important 41 occupational groups in 1934. Per capita Earnings Average hours Occupation weekly earnings per hour per week Still firemen. $27.40 $0,767 35.7 Gagers 27.01 .741 36.4 Laborers 19.03 .546 34.9 Machinists 31.45 .896 35.1 Pipe-fitters Pipe-fitter's helpers. 30.12 .857 35.1 22.97 .658 34.9 Pumpers 29.25 .825 35.4 Still cleaners 24.98 .774 32.3 Stillmen, cracking.... 35.21 .981 35.9 Stillmen, straight distillation 33.11 .923 35.9 The distribution of workers employed in the refining of petroleum by average woekly earnings is given in the table below, which is based upon average earnings during the early part of 1934. Ono-fourth of the workers onrned less than $21.50 and another quarter earned over $31.71. Less than one percent of the workers earned $48.00 or more 42 and 11$ earned as much as $33.00 per week. Itid. PP. 1311, 1316, and 1318. For description of the process of refining petroleum see general section on "Technological Aspects of the Potroleum Industry". 42. Monthly Labor Review. November 1935, loo, cit., p.1317. -23- Weokly earnings Simple poroontago of w?rKQ£S. Cumulative per¬ centage of workers Under #8.00 and under $16.00 &16 and under $20.00 $20 and under $24.00 524 and undor $28.00 ?28 and under $32.00 52 and under $36.00 56 and under $40,00 $40 and under $48.00 $48 and over 1.1 5.2 11.7 19.0 22.0 17.2 12.8 6.6 3.6 .8 1.1 6.3 18.0 37.0 59.0 76.2 89.0 95.6 99.2 100.0 A similar distribution table based upon hourly wage rates in the refining branch of tho petroleum industry shows that 46.4% or nearly one half of all employees earned be¬ tween 32.5 and 77.5 cents per hour. Twenty-five percent of the workers earned less than 61.8 cents and another 25% A*: earned more than 87.1 cents per hour. Average hourly Simple percentage Cumulative per- earnings of workers centage of Under 42.5 cents 2.0 2.0 42.5 and under 47.5 cents 1.4 3.4 47.5 and under 52.5 cents 6.7 10.1 52.5 and under 57.5 cents 7.4 17.5 57.5 and under 62.5 cents 8.8 26.3 62.5 and under 67,5 cents 10.1 36.4 67.5 and under 72.5 conts 10.4 46.8 72.5 and undor 77.5 cents 9.7 56.5 77.5 and under 82.5 conts 10.1 66.6 82.5 and under 87.5 cents 9.1 75.7 87.5 and under 92.5 cents 8.1 83.8 92.5 and undor $1.00 8.2 92.0 $1.00 and under $1.10 5.2 97.2 vl.10 and over 2.8 100.0 As in other branches of tho petroleum industry, hours worked per week in refineries wore reduced considerably duo 43. Ibid, p. 1309, -24- 44 to the Petroleum Oodo. Tho following distribution table reveals that the hours of labor of most refinery workers was close to the oodo maximum of 72 hours for two weekss Weekly hours Simplo percentage Cumulative porcont- of workers age of workers Under 16 1.4 1.4 16 and under 32 8.5 9.9 32 and undor 36 19.1 29.0 36 and undor 40 46.5 75.5 40 and undor 44 21.2 96.7 44 and over 3.3 100.0 The table shows that 36.8$ of the employees worked be- tween 32 and 44 hours per week. The reason that some worked as much as 44 hours was the fact that some plants operated on the basis of one long week followed by one short week of work.45 i (4) Clerical Employees The availablo statistics concerning the earnings and hours of labor of clerical workers in various branches of the petroleum industry is found in the Bureau of Labor Statistics study from which much of tho ^Information in this section has been taken. Tho study shows that while there were fluctuations in employment and in wages of tho clerical workers from May 1929 to July 1934, they were not as pro¬ nounced as were the fluctuations in conditions of the operat¬ ing employees. The following table gives the statistics 44. Ibid, p. 1314. 45. Idem. -25- 46 for clerical workers. Industry branch and period Per oapita weekly earnings Earnings per hour Average hours per week Employ¬ ment index Drilling and production: May 1929 $33 * 00 $0.69 48 100.0 May 1933 32.00 .71 45 66.7 Nov. 1933 31.00 .78 40 77.7 May 1934 31.00 .75 41 83.6 July 1934 32.00 .83 40 88.1 Pipe Lines: May 1929 35.00 .74 48 100.0 May 1933 32.00 .76 42 85.6 Nov. 1933 31.00 .81 39 105.2 May 1934 32.00 .81 39 109.2 July 1934 33.00 .84 39 114.6 Refining: May 1929 33.00 .76 44 100.0 May 1933 30.00 .75 40 84.5 Nov. 1933 30.00 .79 38 92.3 May 1934 30.00 .79 38 95.4 July 1934 32.00 .84 38 99.5 It can be seen from a comparison of these statistics with the average figures for operating employees in each branch of the industry given in preceding paragraphs that clerical workers averaged higher wages per week than did the average operating employee. However many occupational groups among the operating workers earned more than did the clerical workers. 46. Monthly Labor Review. July 1935, loc, clt, . pp. 23-24. -36- (5) Gasoline Filling Stations The latest study of the Bureau of Labor Statistics of conditions among filling station employees was con¬ ducted in 1931, covering 736 representative stations. Conditions have changed considerably since then, so that the information gathered is not very helpful. The study estimated that during the period of April to July 1931 filling station employees earned an average of 39.3 cents an hour and $23.39 per week. Employees worked an average 47 of 59.5 hours per week. Statistics for specific occupa- AQ tions were given for this same period as follows: Occupations Average earnings in one week Average earn¬ ings per hour Average hours worked Operators $27.01 $0,441 61.3 Operators' helpers 20.71 .362 57.2 Porters 12.65 .193 65.7 Tire men 20.36 .300 67.8 Car washers 15.36 .248 61.9 Greasers 23.41 .393 59.6 Relief men 19.07 .409 46.6 H.A. Bradley, President of Gas Station Operators National Council, states concerning the statistics gathered by the Bureau of Labor Statistics;4" 47. U.S. Bureaxi of Labor Statistics, Bulletin Ho. 578. "Wages and Hours of Labor in Gasoline Pilling Stations and Motor Vehicle Repair Garages", (1931), p.5. 48. Ibid. p.6. 49. Quoted from letter to Daniel Horowitz, dated Jan. 26, 1937. -27- "...I have never been able to agree, however, with the figures carried in this survey. I am afraid that the representative stations from which the data was taken, were by far the better stations in onch olty, bocause wages such as containod in that roport simply did not exist in 1931. Tho estimate (of hours worked) contained in that bulletin is also low. If I am properly advised, it was determined at the advent of the N.R.A. that tho average hours of filling station employees was 84.5", Mr. Bradley estimated that the average wage among unorganizod gasoline station workers was, in January 1937, $15.00 per week and that the average work week was 58 hours. In contrast, Mr. Bradley pointed out that employees working under union contract worked a maximum of 48 hours per week with no overtime permitted and that their average 50 wages in different classifications wero: Average earnings Average earnings Occupations per woek per hour Service station operators $27.17 $0,566 Service station helpers 24.10 .502 Porters 19.54 .407 Tiro repair and accossary men 25.20 .525 Car washers 19.54 .407 Part tine and relief men "" — — .466 Although the information given by Mr. Bradley is not altogether conclusive, inasmuch as general statistics for non-unionized gasoline stations are fragmentary and in the nature of estimates, it seems quite clear that there is a definite differential between the employment conditions of union and non-union gasoline stations. -38- CHAPTER II: COITPANY LABOR POLICIES Sootlon I: COMPANY UNIONS The inauguration of a "company union" by Standard Oil Company of New Jorsey In its New Jersoy refineries on April 1, 1918^ was the first attempt to introduce an employee representation plan in the petroleum Industry. From 1918 to 1933 company unions wore introduced into the various subsidiary companies of Standard Oil Company of New Jersey, and also a number of other oil oompanies. The growth, however, was slow compared to the rapid in¬ crease of company unions immediately prior to, and during 2 the N.R.A. period. The reasons for the introduction of the company unions are numerous, but as Dr. John A. Lapp, a member of the Petroleum Labor Policy Board under the National Industrial Recovery Administration stated: "...Probably no one factor has contributed more to works council or company unions, as they are sometimes called, than the antipathy of employers to 'outside dictation' of their labor policy". 1. See Industrial Representation Experience of Standard Oil Co. (N.J.) pamphlet published In 1919 by Standard Oil of New Jersey. 2. Report of the Petroleum Labor Policy Board. Vol. I, p.81. The Report, not yet published (February 1957), was com¬ piled under the direction of Dr. John A. Lapp, who had been a member of the Board. 3. Ibid. Vol. I, p.73. Thet is, the introduction of company unions represented an attempt to forestall or stop the organization of workers into trade unions. Another factor, frequently another manifestation of the first factor, has been the desire of the companies to utilize the machinery set up under the employee representation plan to keep the workers better satisfied with the conditions of employment by giving them a formal, if ineffective, voice in company policies. W.T. Holliday, President of Standard Oil Co. of Ohio, has said: "...The labor unions grew up through conflict. They were based upon the antagonism of interest of employers and employes in the early days of the industrial revolution. Employee representation, on the other hand, began in the early years of this century from the realization of the community of interest of capital and labor."4 That this statement is not entirely based upon the cir¬ cumstances which actually helped to develop company unionism in the petroleum industry is indicated by a history of the events which led up to the introduction of the employee representation plan at the Now Jersey refineries of the Standard Oil Company of New Jersey in 1918, The history not only reveals the reason for the intro¬ duction of an employee representation plan, but also gives an indication of the general policies of Standard Oil Company of New Jersey. These policios might bo summarized as being, a refusal to permit employees to have any voice in determin¬ ing wages and working conditions, a determination to pre¬ vent collective action by employees at any cost, a policy 4. National Petroleum News. March 14, 1934, p.60. -30- of paying wages no high or thrn vugus pr.id by other re- 5 finorios in tho vicinity,' ruul permitting foremen to oxerciso authority of hiring and firing without nood for justification or oxplanntion to the workers. During July of 1915, a strike was called by tho still cleaners at the Bayonnc, N.J. refinery of Standard Oil Company of Now Jersey, who had been refused n fifteen percent pay 6 rise. The striko spread rapidly and tho company was forced to shut down tho plant on July SO; it warned tho men, however, that thoy should pay no attention to the efforts of "professional agitators" to induce then to nako demands for changes in working conditions and wages 7 and that the company would deal only with its own workmen. T„e company, a few days later, refused to submit the con¬ troversy to mediation and "unceremoniously discharged" the employees who submitted c. petition to the management 8 suggesting the mediation. After much violence and rioting in clashes between tho police, deputies and company armed guards and tho 5. It is interesting to noto that the other companies having refineries in the Bayonnc, II.J. area, the Tide Water Oil Co. and tho Vacuum Oil Co., aro both controlled by the sane interests that control Standard Oil Co. of II.J., thus permitting the throe companies to retain a uniform low wage policy and yet individually absolve themselves from fault. 6. Ilew York Times, July 18, 1915, Section II, p. 12. The National Petroleum News, August 1915, p.68, stated that those still cleaners working "many hours a day in a temperature around 200 degrees", were paid $2.00 to $2.40 a day. New York Tjracs. July 20, 1915, p.5, stated that the strikebreaking still cleaners, who had been hired to replace strikers, quit because the;'' "found those condi¬ tions unbearable". 7« Now- York Tines. July 21, 1915, p.l. 8. Ibid., July 25, 1915, Section II, p.10. -31- strikers, during vhioh nlno workers woro killed and about fifty wounded and all "outside r.i itators" either nrrostod or driven out of town, Sheriff Kinkoad euocoodod in broak- Q ing tho morale of the strikurs suffioiontly® to havo them call off thu strike upon his claim of "an inpliod proniso for higher wages".A fow days after the strike was called off, Standard Oil Co, of Now Jersey granted its 11 employees a ton percent wago increase. "When, during tho next month, tho men threatened to strike again unless the hour3.[of work vero reduced from nine to eight, and 12 wages increased an additional 5 porcont, the company compromised by granting an eight hour day without any reduction in wages.^ Tho report of George P. Wost and C.T. Chenory, vfoo investigated the strike for the United States Commission on Industrial Relations, gives a clear picture of condi¬ tions at the Standard Oil refinery and of the attitude of the company toward collective bargaining. The report said, in part: "...The Standard Oil Company of New Jersey, although con¬ ducting on enormously profitable ontorprisa, pays wagos too low to maintain a family on a confortablo healthful basis. It fixes wagos not with relation to tho earnings of tho company but by taking into consideration wages paid by the other companies in tho sane locality and then fixes the wages as loir as, or lower than the prevailing wage in the locality. 9. Ibid.. July 22, 1915, p.l; July 23, 1915, p.l; July 25, 1915, Section II, p.10; July 30, 1916, p.18; Aug. 1, 1915, Section II, p. 8; May 7, 1917, p.7. 10. Ibid., July 27, 1915, p.l. 11. Ibid., July 31, 1915, p.14. 12. Ibid., Aug. 30, 1915, p.3. 13. Ibid., Sept. 4, 1915, p.12. 38- "In Bayonne it p-1id coiamon laborers less then those of two companies whose plants adjoin its refineries. This is in direot contradiotion to the olairas of the company in a statement issued at 86 Broadway, that it always has paid the prevailing wage or bettor. The statement of the General Manager of the Company that the interests of other companies in the same locality are considered in the fix¬ ing of wages constitutes, in effect, an admission that the company combines with the poorest and least generous employ¬ ers to fix wage rates".14 In regard to the company's policy toward collective bargaining, the report stated: "...The company maintains a settled policy of refusing to deal with any labor organization or 'professional labor nan' and even refuses to rermit those employees who can¬ not speak English intelligently to engage an attorney as their spokesman and representative." The report then discussed the strike and stated, in part: "...The strike was broken by Sheriff Eugene ICinkead who first overawed and disorganized the strikers by assaulting and arresting one of their leaders, and then strengthening his control over them by promising to use his influence to obtain an increase in wages and by arresting thirty of the armed guards £)f the company ). ' Two days after the men had returned to vork the Standard Oil Company announced an in¬ crease in wages. These increases were less than those de¬ manded by the strikers, and the rates now being paid are still below those paid by one of the other companies adjoin¬ ing the Standard Oil Company plant, if the common labor rate can be taken as a basis of comparison." 14* Quoted portions of report are from New York Times. Aug. 16, 1915, p.l, ft. The National Petroleum News. Aug. 1915, p.68, wrote ..48$ of the workers in the oil plants at Bayonne were able to support their families on their weges, while the rest were forced to take in boarders, or put their children to work to bring their income up to a living standard." -33- The report concludes: "...The outoone of the striko constitutes a complete victory for the Standard Oil Company as to Its vital policlos, that is, its refusal to rooognlze or permit collective action or to make any concession to tha men, except of its own free will and aooord." The following year, in Octobor 1916, the omployoos of Standard Oil Company of Wow Jor soy at Bayonno again 15 called a strike, after boing refused a number of demands among which wore wage increases, discharge only with cause, and "humane and decent treatment at the hands of foremen and superiors in plhce of the brutal kicking and punching we 16 now receive without provocation." The v/orkers succeeded in shutting down the Standard refinery as well as Tide Irfcter Oil Company and the Vacuum Oil Company refineries . T, 17 in Bayonne. Violence became widespread as tho police and hastily sworn in deputies attempted to break up tho picket lines. The municipal officials' attitude in Bayonne is revealed by a report in the Now York Times, a newspaper which was demanding editorially, as it had in tho earlier 18 19 strike, that troops bo sent in to break the striko. 15. New York Times. Oct. 10, 1916, p.11. 16. American Federation of Labor, American Federationist. Dec. 1916, p. 1171. 17. New York Times. Oct. 11, 1916, p.l. 18. Ibid.. July 25, 1915, Sec. II, p.14. Also Ibid., Aug. Aug. 3, 1915, p.8. 19. Ibid., Oct.. 13, 1916, p. 10. The editorial, in part, stated, "Nobody wants to have a lot of ignorant workers shot for an assertion of what they think their rights, and of what, not improbably, are desperate needs, but the best way to prevent such bloodshed is to bring against the little revolution, forces so strong that the partici¬ pants in it can see the usolessness of further resistance." 34- The Tines reported: "...-Residents of Bayonno talked of organizing n. Citizens Vigilance Connittoo to protuot lifo and property and Mr„yor Piorro Garvnn told then thoy woro ontitlod to use such r.rns rs thoy required to accomplish this. At Polico Hondquartors pornits to onrry weapons woro is sued to r.ny reputable oitizons requesting thorn."®0 The American Fodorrtionlst. official organ of tho American Federation of Labor, described the activities of police and officials in an editorial: "...In Bayonno, as elsewhere, there exists an allianco between the public agencies for forco and the private corporation dominated by tho Rockefellers. The mayor of Bayonno is authority for the statement that ho is an attorney for the Standard Oil Company. Ho emphatical¬ ly endorsed the methods employed by tho Police Depart¬ ment in dealing with the striko. What those methods were is disclosed by the daily papers of Now York City- to many of which no one would dream, of imputing sympathy for the wrongs of the wage earners. "The entire police force, armed with riflos, assumed the defensive for 'Standard Oil' interests and attonpted by an initial display of force to over¬ awe the strikers. "'Deputies' were hurriedly sworn in to reinforce the regular polico - as an aggressive military force. They invaded the district whore the strikers lived, drove the strikers off the streets and into their homes. The New York Times, the vigilant enemy of organized la^or reported that the polico threatened to shoot to kill if tho strikers did not 'get-in - 20. Ibid.. Oct. 12, 1916, p.l. 21. In New York Times. Oct. 13, 1916, p.l, "Tho littlo armies (of police and deputies), marched through the streets thronged with strikers. To each they gave the same order 'Get off the street.'' and emphasized it with a flourish of their weapons. At tho slight¬ est hesitancy on the part of the crowd tho police¬ men fired." First shots were fired into the air, but if ineffective, wore aimed at strikers.^ according to the newspaper report. -35- kocp in, and stay away from thoir windows'."22 The strike was finally brokun through the terroris¬ tic action of tho police *uid was officially callod off on October 19, 1916.23 The strike had lr.stod twolvo days during which time sevon people wore killed and nearly 24 fifty v.'oro wounded. Tho police and fironcn of Bayonno woro rowr.rded for thoir services to Standard Oil Company by company contributions to the Police Pension Fund and ?5 the Firemen's Relief Association.'' The connany, because of the- threat of another strike granted a wage incroaso to employees on November 28, 1916 raising avert.go day wage to $2.50 for eight hours of work The following year the Now York Tines, referring to tho situation during tho early part of 1917, stated: "...Everyone at this time predicted another strike in a short time, despite tho 10$ wrge increases after each former strike. The workers felt that they could only raise wages through strike action."27 The company attempted to overcome this attitude on tho part of its employees by voluntarily granting a 10-15$ OQ wage increase in April 1917^ and a 10$ wage incroaso in 22. American Fodoratlonist. Doconbor 1916, p. 1171. 23. Nov; York Tines, Oct. 19, 1916, p. 18; Oct. 20, 1916, p»7. 24. Ibid.. May 7, 1917, p.7. 25. Ibid., Doc. 23, 1916, p.11. 26. Ibid.. Nov. 29, 1916, p.l; Oct. 22, 1916, Sec. I, p. 27. Ibid.. May 7, 1917, p.7. 28. Ibid.. April 15, 1917, Soc. I, p.18, -36- 29 October 1917, Thoso wngo inoronsoe v/oro more appnront than real since tho oost of living was rising rapidly during this poriod. On March 85, 1918 tho company announced to its omployoos tho inauguration of an employee representation plan in its throe Now Jorsoy refineries—Bayonno, Bnywny, and Eagle plants,30 Tho introduction of the company union plan seems to have boon caused in groat part, as the procoding facts testify, by the attitude of those in control of Standard Oil Co, of Now Jorsoy. Its employees v/erc more and more becoming convinced of the value and necessity of self- organization in order to improve their working conditions, so in order to forestall any "outside" trado union from organizing an effective collective bargaining agency with¬ in Standard refineries, tho company gave the workers a semblance of collective bargaining through the medium of the company union. That the company correctly gaged the feelings of its employees is tostiflod by the statement in the New York Times after the socond striko at Bayonno. The Tines reported: "...In anticipation of coming trouble tho men are now perfecting thoir organization, so that, if it bocomos necessary to striko, the men will go out vith a compact organization behind them, able to make an effoctive fight for their demands."31 29. Ibid.. Oct. 11, 1917, p.18. 30. Ibid., March 26, 1918, p.8, 31. Ibid.. October 22, 1916, Sec. I, p.16. -37- Anotlier factor, whioh undoubtedly placed a part In molding the company's new policy, was a desire to avoid a repetition of the 1915 and 1916 strikes which had re¬ sulted in considerable bloodshed and had caused a cessa¬ tion of production in all of the Standard Oil refineries in New Jersey as well as in the refineries of the Tide Water Oil Company and the Vacuum Oil Company in the 32 Bayonne vicinity. A third factor, which played an unascertainable part in prompting the introduction of the company union, as well as a series of welfare schemes which will be discussed later in this report, xvas an apparent growing interest in the welfare and condition of its employees and a desire to win their confidence. The company union had been introduced in 1915 by the Rockefeller interests into the Colorado Fuel and Iron Company after a disastrous mine strike in 1913-1914. Dr. Lapp states: "..-.In view of the apparently successful operation of the Rockefeller plan (in the Colorado Fuel and Iron Co.), it was natural that the Standard Oil should be the first large oil company to enter this field of employee organ¬ ization. *'33 C.J.Hicks, who had, with W.L. McKenzie King, the present Prime Minister of Canada, assisted Rockefeller in intro- 32. Ibid.. July 23, 1915, p.l; July 27, 1915, p.l; Oct. 1916, p.l; Oct. 12, 1916, p.l; Oct. 15, 1916, Sec. I, p.9; Oct. 20, 1916, p.7. 33. Report of the Petroleum Labor Policy Board, op. cit. Vol. I, p. 74. -38- ducing the company union into tho Colorado Fuel and Iron 34 Company after the Ludlow Uriesnoro, now organized a company union in tho throe How Jersey refineries of tho 35 Standard Oil Co. (Now Jorsoy)' Tho employee representation plan introducod by C.J. Hicks is of the Joint Council Representation typo and h^s served as a nodol for tho plans lator adopted by othor 36 companies in tho potroleum industry. Tho plan provides for a joint council with equal representation for employees and management. The employee representatives are elected by the workers from each department in the plant, while the management representatives are appointed by the management. Grievances concerning, one department of a plant ere handled by the department representatives. Those concerning an entire plant are handled by a joint conference of representatives of tho plant. Appeals may be made through tip#, joint conferences to the Board of Directors of the company, which renders the final decision. All department matters, such as wage adjust¬ ments, hours of work changes, and gonoral changes in working conditions, boforo they can bocomo effective, require the approval of tho Board of Directors. Fro- 34. Commons, and associates, History of Labor in tho United States. Vol. IV, pp. 338-340, (1935). 35. Report of the Petroleum Labor Policy Board, op. cit.. Vol. I, p. 74; N.Y. Times, Kerch 27, 1918, p. 15. 36. Tho second typo of plan adopted was the so-called "employee plan" which'provided for employee committees to take up grievances with tho management. See Report of Petroleum Labor Policy Board, op. cit.. Vol. I, pp. 79-81. -39- vision is made for quarterly meetings of plant representa¬ tives, and annual inter-roflnery meetings. The administra¬ tion of the plan and the oalling of meetings is in the 37 hands of the management representatives. Vital questions such as promotions, layoffs, transfers, annuities, and the welfare benefits set up by the company, are considered "company business", not to be discussed by the joint 38 councils* In order to create confidence in the plan, company officials, at the inauguration banquet of the newly elected representatives of the Hew Jersey refineries on April 1, 1918, announced a 10$ wage increase and the introduc¬ tion of a plan for old age and service annuities and for 39 sick benefits. The company subsequently added a number of other welfare plans which vdll be discussed in detail later in this report. Despite the obvious absence of effective collective bargaining under the company union plan, the company seems until very recently to have succeeded in its pur¬ pose of preventing repetitions of the 1915 and 1916 strikes, and of preventing "outside organization". Officials re- 37. Industrial Representation Esroerlence of Standard Oil Co. of N.J.. on. oit.. pp. 13-17, 19. Also W.L, Lauck, Political and Industrial Democracy. 1776*1926. pp. 151- 153. 38. Robert W. Dunn, Company Unions, p.45; also, Labor Research Association, N.R.A, Ifotes, Jan. 1934, p.4. 39. New York Tiroes. April 2, 1918, p.l. -40- fused to grant wage inoreases requested by employee 40 41 42 representatives in 1925, in 1924, and again in 1925, yet the employees, \tiile threatening to strike and organize 43 a trade union in 1924, have refused to take any "drastic notion" because of the company union and the fear of dis¬ qualifying themselves from benefits under the various 44 welfare plans set up by the company. The Standard Oil Co. of Hew Jersey introduced an identical company union in 1919 into its marketing depart- 45 aents in New Jersey and Delaware, its Parkersburg, W.Va. refinery and its eastern producing subsidiary, the Carter Oil Co. Since then similar organizations have been 47 formed by the company in all of its subsidiary companies.- 40. Ibid>. Jan. 6, 1923, p.20; Jan. 27, 1923, p.20. 41. Ibid.. Apr. 3, 1924, p. 36. 42. Ibid., Sept. 5, 1925, p.15. 43. Ibid.. Apr. 8, 1924, p.30; Apr. 10, 1924, p.38; Apr. 17, 1924, p.9; Apr. 18, 1924, p.2. 44. The workers at the Bayonne plant of the Vacuum Oil Co., who had a company union, but no welfare benefits, wore denied wage increases in 1924, at the sane time as Standard employees--and they went out on strike. This seems to indicate quite clearly that it was the system of welfare benofits which kept Standard Oil employees from striking. Now York Times, Apr. 16, 1924; Apr. 17, 1924, p.9; Apr. 18, 1924, p.2. 45. The Lamp. House Organ of Standard Oil Co. of N.J., Aug, 1919, p.47. 46. Ibid.. Oct. 1919, p.24. 47. "Industrial Representation Plan Is Analyzed by President Teagle" (President of Standard Oil Co. of H.J.), Gas and Oil Journal. March 14, 1935, p.35. -41— A few nonths after Standard Oil Co. introduced its first company union, tho South Ponn. Oil Company started 48 a similar plan, in December 1918. The next year tho Standard Oil Co. of Indiana, following the load of tho 49 How Jersey Corporation, installed a company union. From 1919 to 1933 the plan was utilized in a gradually increasing nurnbor of companies, although our information on this score is by no means complete. The most compre¬ hensive list of companies in the petroleum industry having company unions - admitted as incomplete by Dr. Lcpp--is given in the Report of the Petroleum Labor Policy Board. This Report states that in 1933, the following companies 50 had company unions: Standard Oil Co. (H.J.) and affiliates Tidewater Associated Oil Co. and affiliates Standard Oil Co. (II.Y.) Standard Oil Co. (Indiana) Standard Oil Co. (Ohio) Standard Oil Co. (Kentucky) Standard Oil Co. (California) Consolidated Oil Co. Sun Oil Company South Penn Oil Company Barnsdnll Corporation Phillips Petroleum Corporation Atlantic Refining Co. Shall Oil Company Texas Company Pure Oil Company 48. Report of the Petroleum Labor Policy Board, op. cit., Vol. I, p. 83, 49. Stanolind Record, House Organ of Standard Oil Co. of Indiana, October 1912, p.9. 50. Report of Petroleum Labor Policy Board, op. cit.. Vol. I, pp. 81-82. One of the companies listed, the Consolidated Oil Co., gave up its company union and signed a national agreement with the International Association of Oil Field, Gas We 11, and Refinery Workers in June 1934. -42- The Indian Torritory Illuminating Oil Co., a sub¬ sidiary of tho Cities Servloo Co., at one time had a 51 company union, hut sinoo has dropped it. Available information concerning those plans is very inadequate and incomplete. Dr. Lapp's Report of the Petroleum Labor Policy Board contains information concorn- ing the company unions of some of these companies and is more complete than other sources. All of the companies covered in the report have Joint Council plans. The study includes information as to the date of inauguration of the plan, the number of employees covered by the plan, conditions of eligibility in the plan, and with whom the final decision in any issuo rests. Following is Dr. 52 Lapp's information: Tidewater Oil Company Bayonno Refinery Plan started January 1, 1922 Number of employees - 1480 All employees eligible Final decision rests with Board of Diroctors. Standard Oil Company (N.J.) Plan started April 1918 Number of employeos-npproximatoly 27,000 (exclusive of marine, manufacturing - Standard Development - natural gas companies and the Humble Oil and Refining Co.) All dmployeus eligible. Final decision rests with Board of Directors (several subsidiaries have the right to appeal to outside arbitration.) 51- Ibid-. Vol. I, p.82. 52. Ibid.. Vol. I, pp. 82-83. -43 Str.ndr.rd Oil Co. (Infry) - (Refinery Branch) Plan started in 1919 In tho manufacturing branch (now oovers othor branches). Number of employees - 15890 All employaos ollglblo 5, Appeal nay bo nado to Socrotary of Labor Standard Oil Co. (Ohio) Plan started June 21, 1933 Numbor of employees - 1091 All employees eligible Final decision calls for outside arbitration. Consolidated Oil Go. Plan started October 19, 1933 Number of employees (unable to ascertain) All employees eligible Final decision with company officials. Sun Oil Co. Plan started July 1933 Number of employees - 5700 All employees eligible Final decision with President, but can be appealed to outside arbitration. South Penn Oil Co. Picui started December 16, 1918 Number of employees - 5700 Final decision rests with four employees and four management representatives. 53. Dr. Lapp does not discuss cases in the exercise of the right to appeal to outside agencies. Facts are not available to indicate how real is the right to appeal to outside arbitration. The only record of appeals found from a search in the House Organs of Companies permitting outside arbitration reveals that two cases were brought before the Department of Labor by the work¬ ers of Standard Oil Co. (Ind.). The first case, in March 1920, was an appeal from the decision of the company denying common laborers' petition for 75 cents per hour after their wages were increased from 52 to 59 cents per hour. The Department of Labor upheld the company. In November 1924, the watchmen at the Whiting plant of the same company had had their hours of work reduced from twelve to eight and their pay rate raised from 50 to 60 cents per hour. The workers asked for 63 cents and upon appeal, the Department of Labor granted 62^ cents. These two cases are recorded in Stanolind Record. December 1924, p.3. Barnsdall Corporation Plan started In 1933 Number of enployoos - 500 (Production Depart¬ ment ) Employees must sign for membership In Workers Counoil. Final deoision rests with management. John D. Rockefeller, Jr., who control oil companies having company unions, in defending company unions in 1926 stated: "...Some people will maintain that the men's interests can¬ not be adequately protected or their rights at all times enforced without the support of their fellows in similar industries. This may be true when labor and capital do not generally recognize that their interests are one. But when men and managers grasp that vital point, as I believe this plan will help them do, and are really awake to the fact that when either takes an unfair advantage of the other the ultimate interests of both are bound to suffer, they will have an incentive to fair dealings of the most compelling kind."54 ¥fhat Mr. Rockefeller, in effect, says, is that it is not necessary for employees to build outside collective bargain¬ ing agencies because the company, realizing the common interests of employers and employees, will maintain a benevolent paternalistic policy toward its workers. That many of the workers are not altogether satisfied with 1i e company union method of collective bargaining is indicated by the recent action taken by the employee repre¬ sentatives of the Standard Oil Co. (N.J".) and Tidewater Oil Co. Bayonne refineries. On J"anuary 23, 1937, thoy con¬ ferred with John L. Lewis, Chairman of the Committee for 54. New York Times. Oct. 31, 1926, Sec. IX, p.4. Industrial Organization, and Harvoy 0. Framing, President of the International Assoointion of Oil Field, Gas Well and Refinery Y/orkors of Aaorloa in Washington, to dis¬ cuss plans to organ!zo the Bcyonno refinery workers as members of the latter organization. The employeo ropro- sontatives "expressed dissatisfaction with the prosent employee representation at both Standard Oil and Tidewater plants."55 It is too early, as yet, to judge the extent of the discontont and brewing "revolt" of petroleum work¬ ers against company unions. Section II: WELFARE PLANS The installation of various welfare plans by a number of companies in the oil industry was probably prompted by many of the some considerations which caused the intro¬ duction of company unions. An attempt to increase the loyalty of employees by giving them a definite interost in possible benefits to be derivod from various of the wolfare plans was undoubtedly a motivating factor in the introduc¬ tion of these plans. 55. New York Times, Jan. 24, 1937, Sec. I, p.32, It is important to note that the employees of Tidewater Oil Cot in Bayonne had been given a 5$ wage increase during the early part of Decombcr 1936, after threatening to strike for a 10$ increase. On December 30, 1936, the pumpers at the same plant staged a "sit-down" strike which halted all operations c.t the refinery and gained wage increases for them. See Now York Tines. Jan. 1, 1937, p.29. ™ ~ -46- The Industrial Relations Counsellors, an employers' research agency, in its Report on Eriroloyoe Stool: Ownership, lists a number of advantages which employee stook owner¬ ship is considered to have for the companies. Among these advantages, whioh may also be applied to most of the other welfare plans, are listed:56 1. The plan encourages thrift and makes the employees self-reliant, 2. If the plan adds to the employee's earnings, it helps to convince him that the employer is interested in his prosperity, thus strengthening the morale of the working force. 3. It reduces labor turnover. 4. Attracts "stable and responsible" workers to the company. 5. The employee feels he has a financial interest in the company and this improves his efficiency and economy by making him feel that the gains and losses of the company are to some extent his own. 6. The employee becomes definitely a participant in a capitalistic enterprise. "This fact may be expected to give him a more conservative point of view toward industry and society generally: certainly such a workman cannot con¬ sistently support communistic or other extremely radical ideas." 56. Industrial Relations Counsellors. Inc., Report on Employee Stook Ownership. 1925 (?), pp. 49-53. 47 The Industrial Relations Counsellors, in discussing the reason for the introduction of the pensions plan by the various companies points to the human consideration involved and then statesi "•••It was hoped that pension, besides facilitating such retirements might be of help in checking strikes, reducing the rates of labor turnover and accidents and might, at times, serve as a balance in restraint of trado union activities." 57 Tho motives behind the other welfare plan aro undoubtedly the same as thoso prompting tho inaugusation of stock owner¬ ship and pcniion plans. The Standard Oil Company of New Jersey was tho leads among tho oil companies in tho introduction of wolfaro plans and apparently developed tho most comprohonsivo systom. A3 in other policies concerning labor roletions, tho othor companies followod tho adminstrativo policios sot down by 58 Standard Oil Company. At the first mooting botwoen the Now Jorsoy rofinorio employeo roprisontativos of tho Standard Oil Co. of Now Jorsoy with company officials in 1918, tho officials announcod th3 introduction of a plan of old ago and sorvico 59 annuitios and of sick benefits. Tho sick bonofit plan providod that an omployoo v/ill rucoivo one-half of his "normal" p^.y for a period varying with the longth of his sorvico; from six wooks bonofits aftor a minimum of ono 57. Industrail Rolations Counsellors, Inc., "Pension Move¬ ment Noods Revisions If To Survivo." (Industrial Ponsions in tho U. S.. No. 1, March 13, 1933), pp. 2-3. 58i Soo company union soction, supra.. p. 41. 59. Nov/ York Timos. April 2, 1918, p. 1. -48- year of service, to a maximum of one year of benefits 60 after ten or more years of service. The .omployeo would become eligible for benefits only after seven consecutive days of illness.6^" The old age annuity plan, introduced at the same time, provided that an employee could retire after twenty years of service upon reaching the age of sixty-five. He would receive a life annuity calculated by multiplying his average earnings for the last five years of sorvice by two percent for each year of service. His maximum annuity, however, 62 was fixed at 75% of his average earnings. On January 1, 1932, the pension plan was changed, providing for a one percent annuity for each year of service and furnish¬ ing an opportunity to double the amount, if the employee contributed approximately one-half of the additional expense to the company. Contributions from employeos amounted to from three to five percent of earnings, deponding upon their age.63 During 1933 the annuity disbursements amounted 60. The schedule was: After minimum servico of one year, benefits for maximum of six weeks; after two years, 11 weeks; after three years, 16 weeks; after four years, 21 weeks; after five years, 26 weeks; after six years, 31 weeks; after seven years, 36 weeks; after eight years, 41 weeks; after nine years, 46 weeks; and after ten years, 52 weeks. Article by Walter C. Tougle. President of Standard Oil Co. of N.J., loc. .oijt., p. 56. 61. Ibid., pp. 55-56 and 58, gives history and details of Standard Oil Co. of N.J.'s welfare plans. 62. Ibid., p.56. 63. IjjaJS. . „ • -49- to approximately $2,000,000, r.oeording to oompnny officials. On September 1934 thoro wero 1,719 retired employees on the pension rolls of the company.64 Tho entire pension plan was terminated at tho end of 1935 booause of "complications raised by payroll taxes under the Federal (pension) plan, depreciation of the dollar, 65 decline in interest rates, and other factors." In its place the company introduced a thrift plan, which will be discussed later in this report. .Among the original welfare plans Introduced by the Standard Oil Company (N.J.) in 1918, provision was made for death benefits for the dependents of employees who had been in the employment of tho company for one year or more. No contributions were required from the employees and the benefits wero determined by the deceased employees* length of service, his rate of pay and the relationship or do- pendency of the beneficiary. Tho maximum benefit was set at $2 ,000. The plan was changed in 1925 and 1932, provid¬ ing that the maximum be $3,000 after five years of service and after ten years, a full year's salary. In 1934 the death benefits paid by tho company to beneficiaries totaled $401,411.°6 64. Idem. . 65. New York Times. Doc. 20, 1935, p.l. 66. Teagle, V/., loc. cit.. p.56. -50- In 1920 tho Standard Oil Company of Now Jarsoy adopt¬ ed an employee stook subscription plan. Tho Cities Service Co. had been tho first oil oorapnny to introduce such a 67 scheme in August 1917 and the Standard Oil plan had somewhat similar provisions. Tho Standard Oil plan provid¬ ed that all employees with one year or more of sorvice could subsoribo up to 10 percent of their earnings toward the purchase of stock, Tho company agreed to add fifty cents to every dollar subscribed by the employees. The funds wore handled by trustees appointed by tho Board of Directors of the Company and were invested in the common stock priced for each half year on the basis of the average price of all Standard Oil Co. (II.J.) common stock sales recorded in the stock exchange in the preceding six months.' The stock was held in trust during the first plan for five years. At the end of 1925 the first Stock Acquisi¬ tion Plan was closed and the company announced that 16,000 of its employees had subscribed to approximately 900,000 69 shares of stock. The company had three subsequent stock subscription plans, each running for three years, and authorized a fifth plan on January 1, 1935, but terminated it at the end of that year for tho same reasons that it had ended 67. Now York Times. July 89, 1917, Section III, p.7. 68. Teagle, V/,, loc. oit.. p.58. 69' The Lamp. House Organ of Standard Oil Co. of N.J,, Dec. 1925, pp. 7-8, -51- 70 its pension plan. Under tho four plans, S,116,802 shares of stook wore distributed to employees, rand tho company estimated at the end of 1934 that 1,160,000 shares still romainod in the nnmos of employees or ox- omployoos. This stock represented 4.5% of the outstanding 71 stock of the company. Due to the lack of information it is impossible to ostimr.te what proportion of this stock is owned by supervisory and managing employees and how much the wage workers actually hold. The Standard Oil Co. of New Jersey adopted the practice in 1923 of granting ono week's vacation with pay 72 to employees having one year or more of service and in 1926 provided for a two weeks vacation with pay for employees 73 after five years' service with the company. During 1926 it also adopted a policy of granting termination allow¬ ances to employees who were fired because of lack of work. The amount of the allowance varied with the age and length 74 of service of the employee. Company officials estimated in March 1935, that the company had distributed more 75 than one million dollars since 1929 in such allowances. 70. Surra, note 65; National Petroleum News, Dec. 25, 1935, p. 21. 71. Standard Oil Co. of New Jersey, Annual Report. 1934, p.7. 72. Hew York Times. April 21, 1923, p.17. 73. Ibid.. April 30, 1926, p.25. 74. Teagle, loc, cit.. p.56. 75. Idem, _ -52- The plan introduced on January 1, 1936, to replace its former stook subscription rind old ago annuity systems* was designated as a Thrift Plan. Tile plan is voluntary and is administered by three trustees appointed by the Board of Directors. All full time employees with one year or more of service afe eligible. The worker may permit deductions as high as 13$ from his wages, the company matching the first three percent dollar for dollar and one- half of the next ten percent. The company liability for all social security contributions is limited, however, to 11$ of the payroll. Cash withdrawals are permitted after two and one-half years of contributions. The worker may choose a life annuity paid upon his retirement at 65 years of age (women at 55), or a cash refund. If the worker dies while in service, a death benefit equivalent to his contributions plus interest is paid to his beneficiaries. The company has reserved the right to amend 76 or cancel any annuity or the entire plan. A number of the other major oil companies have welfare plans which are almost as comprehensive as that of Standard Oil Co. of N.J. The plans have boon, for the most part, modeled after Standard Oil's system, and testify to the influential policy-making position which that company holds 76. U.S. Bureau of Labor' Statistics, Monthly Labor Review. February 1936, pp. 324-327. -53— in the industry* For example, in 1918 tho Standard Oil Company of 77 California adopted a ponsion plan'' and a sickness 70 benefit plan, within throe months after the Now Jersey company had introduced these plans into its refineries. The plans were similar in principle but differed in some 79 details. A fow months after the adoption of the employeo stock subscription plan by the Now Jersey company, Standard Oil Company of California inaugurated a similar plan in 1921.80 The Standard Oil Company of Indiana similarly follow¬ ed the lead of the Standard Oil Company of New Jersey. 81 In July 1918 it adopted a pension scheme and in April Standard Oil Bulletin, House Organ of Standard Oil Co. of Cal., July 1918, p.3. 78. Ibid.. p.4. 79. The pension plan provided for retirement at 65, as had the New Jersey company plan, but permitted somewhat earlier retirement*, in exceptional cases, at tho dis¬ cretion of the Board of Directors. Tho sick benefit plan provided for full pay in event of illness for neriod varying with length of service: after minimum service of one year, compensation for a maximum of two weeks; aftor two yours, four weeks; after throe years, six weeks; after four years, eight weoks; after five years, eleven weeks; after six years, seventeen weeks; after eight years, twenty weeks; after nine years, twenty-three weeks; aftor ton years, twenty-six weeks. Compare with benefits under New Jersey company pl^n, supra. note 60. 80• Standard Oil Bulletin, April 1921, pp. 1-2. 81. Stanolind Record. House Organ of Standard Oil Company of Ind., Nov. 1919, pp. 5-7, gives details of the plan. -54- 82 1921 approved an employee stook purohnso plan, thus following the Now Jersey company's lead as closely as the California company, exoopt that it did not provide for sick benefits. It is interesting to note that while the Standard Oil Company of Indiana granted its hourly paid full time workers a one week vacation after five years 83 of service in 1929, the employee representatives of its company union had been petitioning the management for 84 these vacations at each annual meeting since 1919. The fragmentary information availablo precludes any attempt to make a complete history of the welfaro plans in very many of the petroleum companies. The oil companies hcving old age pensions in 1932, the latest year for which comprehensive information is 85 available, wore: Non-0nnl Association of Oil 44 Field, Gas Wall and Rofinery Workers if America was certi¬ fied in thirty-five cases, Filling Station Employees' Unions in three cases, and joint represents tion of the Oil V/orkors Union and various A.F. of L. craft nan nizations in two 45 cases. 44. For convenience tho International Association if Oil Field, Gas Well and Refinery Workers of America will bo referred to hereafter as the Oil Workers Union. 45. David A. Moskovitz, "Employee Elections Conducted by Petroleum Policy Board," Monthly Labor Review, Oct. 1935, p.955. -71 In the first formal decision of the Boardr involving the Magnolia Petroleum Company of Fort Worth, Texas, a subsidiary of the Socony Vacuum Co., and the Oil Workers Union, the Board interpreted Seotion 7 (.') as guaranteeing: "...to the employees the 'right to bargain collectively' end not merely the right to ohoose representatives. The selec¬ tion of representatives is merely coincidental to the exorcise of the right to bargain collectively, because it is through representatives that collective bargaining is arrived at. If an election is held merely to choose representatives and no plan or provision is made for negotiating and arriving at a collective bargain, then the 'right to bargain collectively' as guaranteed in Suotion 7 (a) is denied to the employees. The Board consistently followed this interpretation in its later decisions. In discussing the effect of the Petroleum Labor Policy Board upon the attempt to organize oil workers, it was stated at the American Federation of Labor convention in 1954: "...The main obstacle has boon a rorsistont drive on the part of the major oil companies, designed to promote company unionism. In all casos where a substantial majority of employees were affiliated with bona fide unions, the Petroleum Policy Board ruled in favor of the unions, and thereby effec¬ tively stopned the unlawful promotion of company unions in the industry."-7 While the work of the Board was important, organization of workers was largely due to the activity the trade unions themselves. The Oil Workers Union obtained a collective 4G. U.S. Department of Interior, Decisions of the Petroleum Labor Policy Board, March 6, 1934 - March 13, 1935, Cv.sc No. 2, p.5. 47. American Federation of Labor, Rooort of Proceedings. Fifty-fourth Annual Convention, 1934, p. 59." -72- bargaining agreement in Juno 1934 whioh covered all of tho employees of tho subsidiary oonpanlos of tho Sinclui r-Con- solidatod Oil Corporation. It was tho first timo that a major oil company signod on ngreonont on a national scalo 48 with the Oil Workers Union. T..a ngroomont was obtained aftor tho employoos of the company in tlio Soioinolo oil fiolds struck in order to obtain Union recognition and wago incrons ;s. The workers closed down all of tho company's operations in the area, including four refining plants, and 119 locsod oil field operations, which had boon producing 15,000 barrols of oil a day.4® Tho strike was called off on May 16, 1934,50 and on agreement was then nogotic tod between the Oil "Workers Union and the Sinclair Refining Company, the Sinclair Prairie Oil Company and the Sinclair Prairie Oil Marketing Company, which are the refining, producing, and mnrkoting subsidiaries 51 of tho Sinclair-Consolidated Oil Corporation. The agreement 48. New York Times. Juno 5, 1934, p.4. 49* Ibid, May 14, 1934, p.5. 50. National Petroleum News, Liny 16, 1934, p. 13. 51. Now York Times, Jane 5, 1934, p.4. Tho Sinclair Consoli¬ dated Oil Corporation any havo consontod to a national agreement with the Union in order to escape paying tho difference between actual wages and the minimum wago differentials from September 1933 to the time of tho sotting of wage differentials by tho Petroleum L«bor Policy Board early in 1934. The oil companies had agreed to pay tho back wages determined by the Petroleum Labor Policy Board but since the Sinclair-Consolidated Corpora¬ tion had a national union agreement which made no pro¬ vision for those payments, the Petroleum Lo.bor Policy Board was in this case powerless to enforce its retro¬ active wage declaration. -73- provided for the cheok-off syataia of oollooting Union duos, vacations with pay, time and one-half pay for overtime und 13 2 wage increases from four to thirteen cents an hour# ' The agreement was signed for a poriod of one year, and has been 53 renewed each year sinoe. The Sinclair-Consolidated Oil Corporation, iu 1935, al30 Signed a national agreement with the Motel Trades Department of the American Federation of Labor, representing thirteen of its member unions. The agreemont covered thoso employees of the company who belonged to the craft unions rather than 54 the industrial Oil Workers Union. The Oil Workers Union, as a result of its organizing activity during the past few years, has been eblo to obtain collective bargaining agreements with more oil companies than ever before. In August 1936 it had sixty-four agreements; most of these, however, are with small independent companies. 55 Some of the companies covered by agreements aro: 52# Monthly Labor h^vlow, August 1934, p.303. Wage schedule as provided in the agreement is riven in Oil and Gas Journal, June 7, 1934, p.20. 53. Oil and Gas Journal. AUr,ust 20, 1935, pp. 22 and 42. 54. Monthly Labor Review. July 1935, pp. 109-110. 55. Oil and Pes Journal. August 20, 1936, pp. 21-22. 74 Sinclair Refining Co., Sirolnir Prairie Oil Co., and Sinclair Prairie Oil Marketing Co.: National Agreement. Shell Petroleum Corporation: East Chicago, Ind. Arkansas City, Kens. Hobbs, N.Mex. Houston, Texas pipeline divisions from Houston north. Shell Oil Company: Entire State of California. Cities Service subsidiaries: Empire Oil and Refining Company: East Chicago, Ind. Okmulgee, Okla. Ponca City, Okla. Indian Territory Illuminating Oil Co.: Oklahoma City, Okla, Maud, Okla. Seminole, Okla. Warner ^uinlan Oil Company: Linden, N.J. Louisiana Oil and Refining Co.: Shreveport, La. Texas Company: Lockport, 111. Laurenceville, 111. Pryse, Ky. Tulsa, Okla. Port Neches, Texas Casper, Wyo. Socony Vacuum Oil Company subsidiaries: Wadhams Oil Company; East. Chicago, Ind. White Eagle Petroleum Co.: Casper, kfyo. Ashland Oil Company (controlled by Swiss Oil Corpora¬ tion ): Ashland, Ky. Tri-State Refining Co. (a subsidiary of Ashland Oil Co.): Ashland, Ky. Wirt Franklin Petroleum Company: Ardmore, Okla. Oklahoma City, Okla. Franklin Cromwell Oil Co.; Oklahoma City, Okla. -75- Champlin Refining Co. Johnson Oil Company Eason Oil Comrnny Tucker Oil Company Texas Pacific Coal and Oil Co. Bell Oil and Gas Company Bohner Oil Company Jameson Petroleum Company Jameson Oil Company Receivership Trustee for Deep Rock Oil Corp. Six rig building companies Enid, Okla. Cleveland, Okla. Enid, Okie. Burkburnett, Texas Forth Worth, Teres Burkburnett, Tern e Burkburnett, Terras Santa Fe Springe, Oi. Santa Fe Springs, C? 1. Cushlng, Okie. State of California i; "While the Oil Workers Union has made considerable progress toward the unionizing of oil workers, its membership of 75,000 represents only a fraction of the total number of workers employed in the industry.The present membership is made up of workers in the producing, pipeline and refining branches of the industry. Refinery workers, apparently, have been more willing to join the Union than production employees, despite the fact that production workers generally scorn more 57 in need of an agency for collective bargaining." Dr. Lapp states in this connection: "...This is probably duo to the fact that thoy (the refinery workers) are located within plants where they moot each other ofton and quito gonorolly discuss problems of mutual interest. In the production branch, the workers are greatly scattered and in consequence difficult to convince of the merits of the collective program."5® Another reason is the fact that the skilled workers in the oil fields, who receive relatively high wages, refuse to join an organization v.'ith the other workers, while the lower paid 56. For statistics on employment in oil industry, see supra. section on •Employment-Cenordl"pp. 1-4. 57. Report of the Petroleum Labor Policy Board, op. cit., Vol. I, p.67. ' 58. Ibid, pp. 67-68. -76- omployooa seem to bo deterred from Joining tho Union boooueo 59 thoy hope eventually to rooulva jobs as skilled workers* Tho Union is at prosont n member of tho Gommlttoo for 60 Industricd Organisation, and has started a campaign to organizo tho workers omployod by tho major oil companies.01 Most of the largo integrated companies have company unions, and tho vast majority of thoir omployoos aro at pronent unaffiliated with any trado union. That tho omployoos belong¬ ing to company unions have already begun to "revolt" and Join the Oil "Workers Union is indicr.tod by the fact that in January 1937 tho company union employee roprosontr.tivos of the Standard Oil Co. of N.J. and Tldo Water Oil Co. refineries at Bnyonno, N.J., conforrod with John L; Lewis, Chairman of tho C.I.O. and Harvey C. Frenming, President of the Oil Work¬ ers Union to plan the unionizing drive in tho refineries at 62 Bayonne. The attempt to organizo gasoline station employees into unions of their own started during tho N.I.R.A. period. Many of the filling station employees had boon working, "exceeding¬ ly long hours for comparatively poor pay"63 rind the operators 59. Ibid, p.68. 60. National Petroleum News, July 22, 1936, p.15. Oil and Go.-' Journal. August 20, 1936, p.21. 62. Nov/ York Times. Jan. 24, 1937, p.32. 63. Re-port of the Petroleum Labor Policy Board, op, clt., Vol. I, pp. 69-70. See supra, section on Wages end Hours, etc. of gasoline station employees, pp. 26-27. -77- now becnno nctivo in organizing uni ma In many nf the citi&3 ^throughout the country. During t Mn yonra 1933-34, fifty-six Fodernl Labor Unions of Filling Stations and YA rohouso Enployoes woro organized in different parts of tho United G4 States. Tho first filling station union to euccood in organizing a substantial number of workers was Fodernl Union Ho. 10GC.2 in St. Louis, Mo. Upon being refused recognition by tho oil companies having gasoline stations in St. Louis, tho Union called a strike on Noverfbor 18, 1933. Dr. Lapp wrote of the strike; "...At tho end of the second day a v .ry largo majority of the stations were closed and the business of tho community was seriously retarded due to the inability of the public and the merchants to secure gasoline to carry on normal operations. Some truckers wore able to purchase their gasoline require¬ ments across the river in Illinois. Others wore forced to curtail delivery operations t) some extent. Gasoline which would have ordinarily been sold or placed in storage vas successfully held in tank cars on sidings and the three or four companies which generally transported their gasoline by tank trucks from their refineries in Illinois to the St. Louis market ceased traasportation by this channel. Had the strike been of longer duration or had the several new unions in surrounding cities joined tho movement, interstate commerce would have been seriously affected."60 The strike lasted six days and v.rs called off when tho oil companies involved announced that they would taj^e back the strikers without discrimination, were willing to equalize minimum wage guarantees and submit all other differences to 64. Amoriern Federation of Labor, Report of Proceedings, Fifry-iourun Annual Convention, 1934, p.58. 65. Report of ale Petroleum Policy Board, op. cit.. Vol. II, p. 226. -78- tho proper Codo authority.^ Aftor both aides had presented briefs bofore the Potrolaum Labor Po.lioy Board during January 1934, an agreement was signed on Fobruary 10 by tho repre¬ sentatives of tho Cities Service Oil Co., Lubrito Refining Corp., National Rofining Co., Phillips Potroloum Co., Sholl Petroleum Corp., Sinclair Refining Co., Standard Oil Company of Indiana and tho Texas Company, by two officers of tho St. Louis Filling Station Operators Union and two members of the Labor Policy Board. The agreement, which was to run for three months, provided for increases in wagos and tho inprove- 67 ment of conditions of employment for many of the workers. When the three month agreement oxpirod, the Union, because of the delay in negotiating a new agreement and an unwillingness to submit to long drawn out conciliation pro¬ ceedings bofore the Petroleum Labor Policy Board, callod a second strike of gasoline station workers in St. Louis on 68 June 2, 1934. The strike succeeded in closing down prac¬ tically all the mnjor-company-ownod and controlled service stations, but most of the stations wore reopened within a fow days with tho city police acting as guards for the companies.29 66. Ibid. Vol. II, p.227. 67. Ibid. Vol. II, p.228. For provisions of tho collective bargaining agreement, see National Potroloum Nows. Fob. 27, 1934, p.24. 68. Report of Petroleum Labor Policy Board, op. cit. , Vol. II, pp. 224-230; National Petroleum News, Juno 6, 1934, p.13. 69. National Petroleum Nows, Juno 13, 1934, p.23. -79- Tho Union now indicated its willingness to submit tho con¬ troversy to tho Potroloum Labor Polioy Board but tho oompanios refused and offorod to take tho strikors baok as now omployafts 70 whon openings prosontod thomselvos, Tho Union was finally forced to osll off tho strike on Juno 10. Its uomborship declined from 1,800 to 70 after tho strike, and dospito tho fact that at the prosont time It has ngrciomonts with a number of small oompanios in St. Louis, it has not yot boon able to , . 71 regain its former strength, Clovoland wr.s tho second city in which offorts woro mndo by a Service Station Fadorr.l Looal Union to nogotiato with sorvico station ownors for a collootivo bargaining agreement * Tho oompanios refused to negotiate with tho Union and a strike was culled on April 17, 1934. The Uuion sucooodod In closing the stations of all the major oil oompanios and thon extend¬ ed the strike to include all sorvice stations in Cleveland.'^ Business in the city was affected oven more seriously than enterprise in St. Louis had been during its first gasolino station strike. Not only was tho normal life of the city affected, but also tho operations of oil refineries in 70. Idem. 71. Report of Petroleum Labor Policy Board, op. clt.„ VoTTTT7 p *€30. 72*. National Petroleum IJews. May 2, 1934, pp. 15-16. -80- surrounding str.tos which normally trr nap Ttod thoir g'.solino 73 to Clovelrnd. Tho important conp.' nios r.ffeotod included the Cities Sorvioo Co., Gulf Refining Co., National Refining Co., Shell Potroloun Co., Sinclair Rofining Co., Standard Oil Company of Ohio, Vacuum Oil Co., and Tuxes Distributing _ 74 Co. After much bickering as to the conditions for negotia¬ tions, it was rgreed to submit all issuos to arbitration, and 75 tho strike wis callod off on May 16. Dr. Lapp acted us the arbitrator and his award resulted in a written agreement between the comprnies and tho Union which providod for con- 76 siderr.ble increases in wages for tho operators. Hie agree- 77 ment was renewed on Liny 16, 1935, and apparently is still in effect. Federal Locals of Filling Station . '.Yorkers have been successful in organizing and representing a substantial number of workers in collective bargaining in a number of other 78 cities since 1933. Tho Federal Locals wore formed into a 73. For a description of the effect of tho strike upon business and commerce, see Report of Petroloun Labor Policy board, on. cit. , Vol. II, pp. igS 1-250. Also see Dr. John A. Lapp's Summary of the Application of the Wagner Act to the Petroloun Industry. (tentrtlvo draft 1935) pp. 73-81. 74. The National Petroleum News. May 23, 1934, p.20. 7~* lb id, May 2, 1934, p.15; May 9, 1934, p.12; May 16, 1934, p. 7, May 23, 1934, p.20. 76. The U.S. Department of Interior, Decision of tho Petrol¬ eum Labor Policy Board, (Appendix) pp. 78-87. 77. Report of the Petroleum Labor Policy Beard, op. cit.. Vol. II, p.249. 78. Ibid, Vol. I, p.72. -31- Hvitlonnl Council on July 13, 1935 v.*i th II.A. Bradloy of Akron, 79 Ohio, as Prosldont. Tho tot.r 1 nunburnHip in Service Station Unions, however, does not oxen ed 20,000, but tho National Council is energetically continuing its organizing, campaign* The Filling Station Unions have succoedod in obtaining rola- tivoly advantageous wnges and work conditions for workers whom they roprosent in colloctivo bargaining with oil eonprnier 81 in various cities.^ The strongest opposition to the unionization of oil workers in nil branches of the industry has como from tho major integrated companies. This is indicated by II.A. Bradley's statement concerning resistance to the unionization of gasoline station workers. He wrote: ir.. .Relative to oil companies who have resisted unionization, probably the most notable among then are tho various Standard Oil Companies, all of which in the early days of the N.P.A. promoted and supported company-unions and used these company- unions as their primary means of resistance to bonafide organization. T^e Texas Company has resisted organization in every way possible, as well as the Gulf Refining Company. The latter company has been known to engage the service of private operatives for the purpose of bringing about dissension within the unions. This was practiced particular¬ ly in Pittsburgh, Pennsylvania. "There has been only the usual and expected resistance from the rest of the oil companies, but in all fairness, I should state here, that there Is far less effort on the part' of the three named companies to opoose organization now than was true two years ago. It appears that the entire industry in the marketing division are using less propaganda as times goes on.""- 72. American Federation of Lubor, Report of Proceedings, Fifty-fifth Convention, 1935, p.96. 80. Report of Petroleum Labor Policy B^ord, op. cit., Vol. i~» p. 72. 81. See supra, section on Wages, Hours, etc. of Filling Station Workers, pp. 26-27. 82. Letter to Daniel Horowitz, dated January 26, 1937.