The Evening Star FRIDAY, AUGUST 13, 1926. LABOR AND THE COURT.

Evening Star, Issue 19327, 13 August 1926, Page 6

The Evening Star FRIDAY, AUGUST 13, 1926. LABOR AND THE COURT.

.Yesterday the secretary of the Otago Trades and Labor Council wrote us a lengthy letter, in which he occupied much space in sotting forth once again a series of points which have already been well threshed out since the Arbitration Court’s pronouncement on the basic wage. But the latter part of his letter is interesting and informative. It discloses an attitude towards industrial economics which may be fashionable in Labor circles or may not be; but Mr Robinson’s declaration tends to confirm the misgivings of those who see in the continuance of the relations between those engaged on either side of industry a threat to the existence of industry. Mr Robinson quotes the Bishop of Liverpool as stating that “ capitalists must open their minds to the fact that wages must come before dividends.” So they must. So in large measure they do. Before any balance-sheet or profit and loss account is made up the costs, including wages (usually the chief item), are sot off against the Rales, and if there is a sufficient balance on the right side a dividend is declared. Nevertheless, there is room for a big change of orientation in the motive of those investing capital in industry. One of the tenets of Socialism is Production for IT so and not for Profit. One of the tenets of Individualism in the newest school of employers is Production for Service and not for Profit. The theory, which has been put into practice so successfully as to rivet general attention, is that if there is concentration on the service of the public profits will come in such measure as to enable high wages to be paid, reimburse the capital employed, and leave a large surplus to he reinvested in the business and enable it to enlarge its pay-roll steadily, while maintaining an average level of pay for each worker’ considerably above the outside standard. We do not see any difference on paper between Production for Use and Production for Service. But those who use the former cry apparently believe that there should be no profits. In that case there would immediately he no capital available for industry, and the usual experience of those starting an industry with insufficient capital, let alone no capital at all, is disister. In the one case industry would disappear; in the other it goes from strength to strength, those served being satisfied and those serving also. But that stage has not been reached in New Zealand as a general rule. Mr Robinson’s letter all through is prima facie evidence of antagonism between employed and employer, instead of the co-operation between them which is essential for the well-being of industry. That antagonism can certainly not he broken down while the doctrine enunciated by Mr Robinson holds sway. The Bishop of Liverpool postulated that wages must come before dividends. It is even more obvious that work must come before wages. And the real measure of work is output, by which alone the amount off equivalent wages can be assessed. In Mr Robinson’s letter the whole underlying contention is that work is measured by the time of attendance put in at the place appointed for work. But is the more fact of a man’s being on the pay-roll to be_ accepted as full proof that he has given the equivalent in work for the pay against his name? Mr Robinson writes Under the present system production is not an issue for us at all, nor is it an issue for the court.” This is coming boldly out into the open. Divested of the irrelevant trappings with which Mr Robinson adorns it, this amounts to denial of obligation on the part of the employee bo give the output equivalent to the wage, while Mr Robinson insists on the employers’ obligation to pay the wage and on the Arbitration Court’s obligation to see that he does it. Mr Robinson complains that the court fails to do this. Going a step further, he accuses the court of fixing fifty minutes’ pay for sixty minutes’ work. But Mr Robinson’s definition of work in that complaint is his own definition—a false one—work which has no relation to output. All the arithmetic Mr Robinson uses so freely throughout his lettor is wasted because on one side of his equation there is an indeterminate quantity.

In a previous article wo wrote that the function of th© Arbitration Court was to fix a fair day’s remuneration for a fair day’s work. If tho definition of work enunciated by Mr Robinson is generally held, the court is asked to do an impossibility. Why, then, should he complain (as 1m does) that the court does not fulfilan impossible function? Tho position appears to be that Labor is chasing a phantom, has set itself to achieve the impossible. At present it is seeking this through the medium of the Arbitration Court, which also has no power to achieve the impossible, and has said so. Therefore, Labor blames and reviles the instrument. There can be no hope of success for the working or the principle of arbitration so long as one of the parties to it is schooled to ignore the connection between Production and Wealth. On the other hand, if Labor would realise that connection —and if employers would realise the possibilities of Production for Service—the need for the Arbitration Court would disappear. There ate two ways in which the court could be made to disappear, and Labor leaders are at present assiduously pursuing one of them. It should be the sincere wish of the community that the other way should prevail. It is not Utopian. It has been achieved already. One of the world’s largest employers, on whoso pay-rolls are over 200,000 employees, writes: “No disputes on wages ever take place. . Although we are not opposed to unions, we have no dealings with them. , . . We pay higher wages than any union could demand for its members generally, we have steady employment, and we are not interfered with.’l