Portal to Portal

Press, Volume LXXXIII, Issue 25088, 21 January 1947, Page 6

Portal to Portal

A Washington message, yesterday, reported evidence before the Senate’s Judiciary Sub-committee of portal -to - portal suits totalling 461,000,000 dollars against the 12 largest aircraft companies and 1,000,000,000 million dollars against tLe steel companies—totals in each case exceeding the liquid assets of the groups. Naturally, the companies were begging that such suits should be “outlawed”; or, in less hysterical words, that Congress should write new legislation, enabling these claims to be settled on some equitable basis and so clarifying the significance of wage contracts that they cannot again produce an avalanche of unforeseen claims for back pay. For avalanche it has been, and is. It was started, unwittingly, when Judge Picard in 1942 found in favour of a small union of pottery workers, who claimed that their employer company had omitted bonus rates from its reckoning of overtime pay, had failed to pay for a quarter-hour lunch period, and had docked too much time from hands clocking in late. The Circuit Court of Appeal reversed his decision; but the Supreme Court, last June, swung the decision back again, and did so in words of prodigious consequence:

| “ Since the statutory work-week ini" eludes all the time during which i“ an employee is necessarily re- ; “ quired to be on the employer’s i “ premises, on duty, or at a pre- : “ scribed work place, the time spent “in these activities must be ac- . “ corded appropriate compensation ”. In this sentence, the application of ] the portal-to-portal principle, which < Mr Lewis battled to establish in the coal mines during the war and ' which was soon after extended to the iron mines, was stretched over all industry. C. 1.0. unions were not slow to see what it meant: that, by this unqualified declaration of the « Supreme Court, interpreting (in j effect) the 40-hour and overtime 1 provisions of the 1938 Fair Labour • 4 Standards Act, they could count up j 1 previously uncounted time, reckon!

pay for it at time-and-a-half, double it for damages, and run the bill back to 1938, or as far back as their j state limitations act would permit. They assessed their claims and lodged them. Industry after industry was staggered by their size. Against the Federal Government, it is estimated, claims for 5,000,000,000 dollars can be lodged; and that is only the beginning, for, of course, every corporation which has to meet a claim will be in a position to reassess its tax liability and apply for a refund of excess tax paid. Obviously the situation, though legally as right and tight as possible, is quite fantastic. Most of the wage contracts were drawn and accepted and applied as both parties understood the 1938 act and the prevailing working conditions under it. The claims have been created by the decision' itself. Again, the Supreme Court’s ruling applies in the most anomalous ways. It stacks up gigantic claims against this industry or that, because of its nature, or because of its location, and not because of any special fault of the owners; and another will escape more or less lightly, though not less or more culpable. Again, limitations acts of the American states vary. Some give claims as long as an eight years’ life; others, only one or two. Mr Green, the A.F.L. president, who was said yesterday to have appealed to his unions not to file their claims, in glad competition with the C. 1.0. unions, urged them instead to “ settle their claims by negotia- “ tion ” with their employers. This would be excellent advice, if it could be followed; but the Courts will not allow any such settlement by compromise or sanction any voluntary agreement that will mitigate the effect of the Fair Labour Standards Act in future. Waivers of rights under it have already been held illegal; even an assurance from the Wage and Hour Administration in Washington that such and such a contract was valid will not stand against the act itself and what is now the interpretation of it. The situation can only be corrected by new legislation. A bill that would correct it was introduced last year, and may now be revived; but

this, fixing a maximum of two years’ liability for back pay in portal-to-portal and many other damage suits under the act, was in many respects excessively severe. It remains to be seen what ingenuity and fairness can combine to do.