CLOTHING: Historic Contract

Since NRA’s famous Section 7(a) was written, many a U. S. employer has had his first experience bargaining (or wrangling) with a labor union over wages, hours, the closed shop. This week some Manhattan businessmen confronted a union contract that involved none of these things. It is such a remarkable contract that when & if it is signed, a new era in U. S. labor relations will be formally opened.

Potent I.L.G.W.U.’s Dress Joint Board (85,000 members) has had a closed-shop, industry-wide agreement since 1933 with Manhattan’s 2,100-odd dress manufacturing shops, who make nearly 75% of U. S. dresses. Last December the union and five trade associations began negotiating a new contract to replace one signed in 1939. To the council table went the D. J. B.’s top man, husky, dimple-chinned Julius Hochman, with a surprise he had been hatching for months in his iron-grey head.

Instead of demanding more pay or shorter hours, Hochman merely asked the manufacturers to do two things dear to every manufacturer’s heart: run their business more efficiently and make more money. Hochman’s theory: the union already had a 35-hour week and adequate pay minimums; how well its members prospered in the future depended on how well their industry fared.

Efficiency has never been the dress industry’s long suit. For years it flourished in a seller’s market; it still inhabits an economic Bohemia where success often depends 50% on talent in designing, 49% on luck and 1% on managerial skill. A shop can be started on a corset string; given a loft and a few cheap machines, anybody can try it. Although dressmaking is Manhattan’s biggest manufacturing industry ($349,482,204 in 1939), its units are pygmies: only 60 firms gross as much as $1,000,000 annually. Some 22% of the companies fail and are replaced by newcomers each year.

Pointing to these facts & figures, Hochman told the manufacturers bluntly that the union was sick of the waste and inefficiency they tolerated. Workers (paid piece rates) sat around idly waiting for materials to arrive, antiquated machinery to be repaired, incompetent foremen to route work to them. Until merchandising was improved, U. S. women would continue to spend less for dresses than for stockings and underwear (average annual purchase: two street dresses). What Hochman wanted was busy plants, busy workmen, manufacturers who understood cost accounting, kept overhead down, prospered.

As steps toward his goal, Hochman had three concrete ideas: 1) a $1,500,000-a-year promotion fund (the union offered to contribute, $100,000) to plug dresses and Manhattan’s claim to Paris’ old title of world’s fashion centre; 2) establishment of a school of management, staffed by experts who would teach the manufacturers how to operate without waste; 3) an “efficiency clause” giving the union the right to demand good’ management and penalizing employers, who failed to provide it.

The promotion fund was accepted almost immediately by the manufacturers. The management school, while it made sense, was bad psychology on Hochman’s part; the employers had to reject it for reasons of personal comfort and they did, without too much objection from Hochman. But on the “efficiency clause” the negotiations soon were deadlocked. The manufacturers, contending that no union had a right to tell them how to run their shops, refused to sign. The union refused to back down. Then Mayor Fiorello La-Guardia offered the union moral support by appointing an “observer” of the negotiations; the conservative New York Times and Herald Tribune praised the union’s plan editorially. Canny Mr. Hochman observed that everybody favored his idea except “the Communists and the employers.” By last week’s end only one of the five manufacturers’ associations remained unbudged.

Julius Hochman, like his boss David Dubinsky, is an old-line Socialist who never lets his Marxian precepts interfere with the practical job of running a union. This was not his first venture in “class collaboration”; Dress Joint Board has been policing the chaotic dress industry’s standards of competition (as well as its labor standards) for many years. Nor is D. J. B. the only union to have done so. Philip Murray’s own S. W. 0. C. claims to have saved three steel companies from bankruptcy by cooperating in efficiency programs; last week it offered similar assistance to unprofitable Lebanon Steel & Iron Co., whose stockholders were about to vote on a plan to liquidate.

But Hochman’s “efficiency clause” represented a new high-water mark in labor statesmanship—a genuine union effort to make its industry profitable. Said he: “The state of the industry is … not something remote and foreign to the workers but something on which their very bread and butter depends.”

This week another union’s decision proved that the new labor philosophy, if on the way, was not uniformly understood. To protect profits in their industry, the International Allied Printing Trades Association (five craft unions with 200,000 members) decided to strike back at competition regardless of net social effect. Estimating that radio advertising has cost 25,000 printers their jobs with newspapers and magazines, the union will lobby for legislation to: 1) prohibit broadcasting stations from selling more than 25% of their time to advertisers; 2) impose a special 10-25% income tax on the stations.

Said Chemical Engineer Foster Dee Snell to the American Chemical Society: “Tetrasodium pyrophosphate or occasionally sodium hexametaphosphate added to soap prevents … a ring around the bath tub.”