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OFFICE OF THE NATIONAL RECOVERY ADMINISTRATION 
DIVISION OF REVIEW 



PROBLEMS OF ADMINISTRATION IN THE OVERLAPPING OF CODE DEFINITIONS 
OF INDUSTRIES AND TRADES, MULTIPLE CODE COVERAGE, CLASSIFYING OF 
INDIVIDUAL MEMBERS OF INDUSTRIES AND TRADES "»• 

By 

Ely C. Hutchinson 



WORK MATERIALS NO. 39 
t/' 



N.R.A. ORGANIZATION STUDIES SECTION 
March, 1936 



OFFICE OF THE NATIONAL RECOVERY ADMINISTRATION 
DIVISION OF REVIEW 



PROBLEMS OF ADMINISTRATION IN THE OVERLAPPING OF CODE DEFINITIONS 

OF INDUSTRIES AND TRADES, MULTIPLE CODE COVERAGE CLASSIFYING OF 

INDIVIDUAL MEI,IBERS OF INDUSTRIES AND TRADES 

Ely C. Hutchinson 



II. R. A. ORGANIZATION STUDIES SECTION 
March, 1936 



9808 



? n s t; s D 



This study of "FrDblt; 'S of Aflninistr.i.ticn in th3 Overlapping of 
Code Lefinitio/.f. of Inv.ustr: et; a.u" u.'rades, "l-altrle Code CovRrar;e, 
Classifying of Inc.ividaal iic-nbers ox Indus'irics r.rid Trvles" was pre- 
pared ty r,T, Ely C. Hutchi-.^son of trie l\~'A Or/"::,ni',:a,tion Studios Section, 
Mr. 'tVilliam 7J. Bardsley in chi.r/<,c. The fina.1 re;,^ort is a consolidation 
and revision of three prelirii.:ary drafts, one of v/hich, tiir.t on the 
Classifyinrj of Indivicual iierc'bers of Industries and Trades v/as pre- 
pared "by T'r. C. Carl Finh, also of the FHA Or:;'anj,zatio-.i Studies Section. 

The -report analyzes the nature of the administrative problems 
arising fron overlappin,^ definitions, multiple code coveraf^c , and the 
necessity of class if yin.^v; members of industries and trades; traces the 
development of a.di.dnistrative procediiro in dealing with the T^rohlems; 
and discusses various aspects of each problem. 

Conclusions reached bv the author v.dll be found in Chapter VI. 
Methodolc^:/ is briefly descri";:ed in Appendix lie. 1, v'hich also s"uggests 
certain i.iateri::.! soiu-ces f 3r fuxther research. 

At the bac!.: of this re-'^ort i-'ill be fouiid a brief statement of 
the studies uadertah.cn by the Division of Reviev. 



Marcn IJ , 19S6 



L. C. Karsliall, Director 
Division of Reviev; 



9808 






TliU'LE CIP CONTEITTS 

Page 

Introduction 1 

Chfipter I - Definitive 2 

I. Overlapping^ Definitions 2 

II . Classification 5 

III. l.iultiple Code Coveratje 4 

C'lapter II - 3volution of P'jlicy and Cr;:3niza.tion 6 

Chapter III - Cverlap::inj Definitions 16 

I . Meaning of the Term 16 

II. Typical Cases 16 

III. Fundamental Causes 18 

IV. Procedure 19 

Y. Industry Reactions 20 

Chapter IV - I/Iultiple Code Coverat^e 22 

I. Basic and Sab-basic Industry Codification 22 

II. Expinples of Multiple Code Coverage 23 

III. Tyoes of Problems 24 

IV. Effects upon Industries 25 

V. Procedure 25 

VI. Outstanding Aspects of Multiple Code 

Coverage 27 

A. Lack of Clear Understanding of Term 27 

B. As Viewed by Industry and Trade 27 

VII. Fundai'nental Factors Affecting Multiple 

Code Coverage 30 



-11- 
9808 



Page 

Cha'Jter V - Classif'/in- of Individurl liemljers of Inclu'^tries 

and Trades . 31 

I. Early Classification 31 

II. Effect of Def inition-.Triting 32 

III. Forms of Industry Dof inition-.Triting 32 

IV. Settlement of Classification Cases 34 

V. Conditions Affecting Problems of Clo,ssif ication. . . . 35 
C"-ia"3tnr VI - Secaiitulation 36 



- 1 1 1 - 
9808 



Pr.ge 

Caapter V - Clasgif'/iiii^ of Individurl Members of Indugtrios 

and Trades 31 

I . 2arly Classification 31 

II. Effect of D("f inition-Jriting 32 

III. Forms of Industry Dofinition-.Vri ting 32 

IV. Settlenient of Classification Cases 34 

V. Conditions Affecting Problems of Classification.... 35 
C-ia'oter VI - Zocaiit-alation 36 



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.\PP3IIDIC3S 

Page 
ITo. 1 Methodology and Further Hecearch 40 

No. 2 "Proposal for He^rou-.in:, of Codes", Jv.ne 32, 1934 

(Part A) . . .' 42 

(Part B) "a Heviev of the Classific? tion Prohlem Situation v/ith 
Recommendations Ros-Tectine,- fLiture Control and Handlini:; 
of these Proolems", January, 1935 • 47 

No. 3 Office MeraoranduTi l\b . 282, A-a:;'u3t27, 1934 56 

No. 4 Excerpt from Ifervard Business Reviev;, Spring, 1935, 

"Ovcrla-piing in the Codification of Wholesale Trades" 58 

No. 5 Memo ran dujn, April 29, 1S35, Section Coiansel to H.I.H.3. 
re "Claf:sificaticn Problem Arising lander Electrical 
Division of the Constraction Code and the Hail-jay Safety 
Appliance Code" • . . . . 60 

No. 6 List of Conflicting Codes > 65 

No. 7 Proposed A^^reoment by and between the Construction Code 
Authority and the Cotton Textile Code Authority, March 
12, 1935 7S 

No. 8 NRA Press Release No. 7482, August 27, 1934 76 



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•IV- 



fhoelel;s 0? adiq/'^sthatioii 
III 
THE ovi:rla~-fi:'g or code j Efi'ii'IO'-'s g^ i':"E":sT?jrs aitd tijaees 

MrLTIFU: C^EE CO^.'EPAC-E 
CLASS lEYE."'- I TDIVIEU.^-L 'E'EEi.S OP - I:T)UFT"''TES A "-' TEASES 

IlITEOr^'CTIO- 



The -problems of adnini strati on '.vEicu arc the su'bject of this study 
had many aspects in co'iraon and xrerz-. closaly deioenient u,?on the same 
fundamentals of organization and a-lmini strati on for their successful 
ha,ndlin^. Thereforu', they arc tre.;.ted to;'_;ether in this report. This, 
in fact, is tne only r.iethod by which discussion of these various subjects 
can avoid repetition -anc I'U'necesEary confusion. 

On approval of the I'a.tiom.l Industrial Recovery Act, Ji--ne IS, 
1933, it was anncivnced tlmt the firnt efforts at coci:^icatioj. of industry 
would be in the industries "'ith ern iloyeea in the ■ nimdreds of thousands. 
The avov/ed i?urpose v/as to ret .len Dae t to worl:, and ail other considera- 
tions in the j'roccdure of th";t tir:ie were otscured, unrecognized, or 
suhordinated. 

However, code ne;jOtiations with several of these industries v;ere 
scarce ly-ur.d''-r way hefore the llatioral Recovery Adninistration was 
faced with mamerous a;"plications for codes froa other industries 
anxious to o'btain a cosition ■in the new industrial scueiae to which 
they felt their irripor-c^nco entitled them. Tith the handling of tne 
codification requiremer ts of tne larger industries, the added load of 
these relatively smaller ap-olicatir^ns put siich pressure on the I'l.R.A. 
administra.tive functions as to make it virtually impossible to give 
each aj^plication the thought and detailed consideration it should have 
liad in the interest of proper •olannin.'^ for the Eational Industrial 
Recovery project as a vhole. This defect, more a. --parent nov/ than at 
the time, Fa.s a --rimar^ ctiusc of the ?,cccptnnce a^v^. a--oroval of mBsay 
code previsions in a loose a'.id impro"ier lorni. These were not errors 
of commission, "but directly the resLilt of aii inadequate "basic concept. 

The nemiesp of the v/hole plan for industrial recovery, to 
industry and -to those responri'ble for its enactment into law, was only 
one of the fundaroentols -chat deeply affected suhsequent ad^idni strati on. 
Another, quite as important , was in the psychology ox the people imder 
"unprecedented depression and the generally recognized need for 
emergency action. It is evi,de-nt that early K.I.R.A. administration v/as 
to a great extent ijidcr t'nis infl-aence and acted in energetic response 
to it. 

It is small v;onder that under such circ-umstances the ir-oortance of 
sound adiiiinistrative planning was fo-rced inbo secondi-ry -position, and 
that one result wae the emergence of administrative it is t'ne i^urpose 
nevertheless to franhly discuss the difficulties in the classifying of 
individual mciabers of industries and traces, in the code definitions of 
industries and tra,des, and in opers.tion of industries and trades under 
multi'Dle code coverage. 
9808 



-2" 
CEAFTEE I. 
DEJIi:iTIVE 



On'^ of th"^ ira-oortpnt n°f^ds for «?ffici'='nt administration of the National 
Industria 1 R=>cov'=ry Act ^-ras a sound and coniorehfinsive classification of 
industries. The TDrimary objective of the Act "^as to -oiit nen back to work, 

under conditions ¥hich would increase real '"ages and, therefore, purchasing 

power. 

Industr;'/' codes •'Tere the visual evidence of the conditions under vrhich 
the industries of the United Sta.tes "TP.re to agree to otjerate. Information 
T'as inadenuate UTDon i^hich to base a nast^r classif ica,tion of industry or 
a pattern of industrial rela.tif^nships, into which the individual industries 
might b'5 fitted, nor '"as any such classification considered necessary by 
N.R.A. preliminary to the codification of industries. 

This is evidenced in the early literature of N.S.A, Its Bulletin 
No. 2, dated Jur 19, 193?, and entitled "Basis Codes of Fair Competition," 
on page 2, states J 

"It is not the fijLnction of the National Recovery Administration 
to prescribe '"hat shall be in the codes to be submitted by 
associations or groups. Initiative in all such matters is ex- 
pected to come from ^ithin the industry itself," 

The Bulletin goes on to discuss the features which it 'vas felt would 
be desirable to be included in th° codes, such as maximum hours, minimum 
wages and standards for th° health and sa.fety of '"orkers, and to point 
out that codes should not be designed to promote monoiDOlies or to eliminate 
or Oppress small ent'=r'oris'=s. 

The whole, it is evident, was -ore-oared "rith a view to leaving the 
initiative '^ith industry and under this regulation tra.de associations and 
other ostensibly re-oresentative groiros ■established the delimitations of 
their industries, '^hich, unless o-o-oosed by some oth^r industry frequentjLy 
reraa.ined in th° definition of the a^^^roved code substantial Iv as first 
writt'^n. 

With this fr^'^dom from restriction enjoyed by industries in making 
a-D-olioation for a code and an administrative -oolicy of encouraging each 
industry to express itself i^'ith res-oect to its o-^n ne^ds for codification, 
and '-'ithout a. ria.ttern into which all industries were r'=quired to have their 
definitions fit, the -oroeedure of code formulation went ra-pidly forward. 
There 'iras little thought and no means of determining the effect the defi- 
nitions and other orovisions of one co-e idight ha.ve u'oon the interests of 
other industries which w^re closely related, 

I. OVERIAPJING DSFIinTIOlTS. 

Th\is th«re were -oresent in those first days of codification all the 
elements calculated to encourage each industry to -■ir°em-ot as much of the 



-3-,- 

industrial map as possible. The advantjages to the industry were several: 

A. The broader the definition of an industry, the wider was its 
field for futizre e::pansion and the greater, was the protection 
against encroachment by other industries. 

B. The broader the definition, the greater would be the number of 
individual enterprises coming thereunder. This afforded an 
opportunity for forcing under the code of that industry individual 
enterprises hitherto competitively obnoxious and compellin-]; them 
to live up tb the code provisions. 

C. The greater the number of individual enterprises comprising an 
industry, the less onerous would be the assessments against each 
to defray the costs of code adiainistration. 

While this sort of thinking was fairly successful in accomplishing 
its purpose in the rush of earlier codification, it later became pro- 
ductive of some of the most difficult orobleras with which administration 
had to cope. 

Difficulties of the type engendered by the granting of broad de- 
finitions of industry later became known as problems of Overlap-oing De- 
finitions, that is, , the definition of an industry in one approved code 
included functions on products also included in definitions of one or 
more other industries. 

II. . . ' CLASSIFICATION 

In the expression "Classification of Individual Members of In- 
dustries and Trades" the word classification denotes the act of deter- 
mining the industrial or trade affiliations, and therefore the code, 
under which an ihdividioal enterprise should operate. It is in short 
the allocation of industrial enterprises to determine their code affi- 
liations. 

The nearest "approach to a definition of the term, and apparently 
the only one in Office Order }]o. 59, dated January 15, 1934, which 
stated in part: 

"The term 'Classification' includes; 

(1^ Problems arising where an enterprise, because of the 
diversity of its products or because of overlapping definitions, 
is covered by more than one code. 

(2^^ Problems arising when it is doubtful whether any 
industrv is included under a code or whether an enterprise 
is included under an industry." 

This meaning of the term "Classification" should be clearly dif- 
ferentiated from "industrial classification," of which the NRA. attempted 
no definition. 



9808 



- -^4- 

Tlie author nov/ ideally defines the latter as: 

A system,'\tic end ?, consistent, g,Touping or arrangement 
■ of the industries and trades of the United States into basic 
divisions and suo-divisions thereof in such rar>,nner as to set 
each apart fron: the other in an established field, free from 
competitive infiltration and other forms of industrial en- 
croachment . , ; . 

A moment's study will maJ:e it clear that it is not -Tossihle to 
effect this idea,l classific?tion of industry. 

As a nation we o.re constantly ■irof;ressini^-; our industries ?jid 
trades are virile aiid the com-ietitive attack is ever-changing. 3nter- 
-)rises are constaiitly shifting their products to take advantage of mai'ket 
demands, and the economic decline of one prodiict is promptly miet by the 
rise of another. ., 

Such conditions compel a realization tiiat v,'ith any nlaji of in- 
dustrial classification there iriust be allowance under codes for the 
constant shift of industrial enterprises from one code jurisdiction to 
another. Sometimes these shifts maj'" be v.'ithin the same basic industry, 
but it is not always so. 

III. :inLTIFLZ COLI] COVrRAGE 

Prequently individual enterTrises manufacture a number of products 
the construction of which utilizes the same basic organi za.tion, tool 
equipment ajid productive skill. Such 'oroducts are sometimes marketa,ble 
by the seme sales force but hot a.lwiys. 

Trequently it hapiened that the nature of the i-iroducts in such a, 
case wa,s so different that the rules for their manufacture and marketing 
were contained in different codes. Thus r-n enterprise was confronted 
with the necessity of conducting its o-oerations tinder two or more codes. 
This ty-ie of situation v.'as called "liultiple Code Coverage." Obviously, 
the -problems of much coverage did not necessarilj^ involve any over- 
lapping of code definitions although the problems are closely related. 

The first official mention of problems of tliis type a;opeared in 
Office heraoraiidum i'To . 282 (*) dated August 27, 1S34, under the caption 
of "Overlapping Codes and Ihilti'ole Code Coverage." The ^Troblem is 
described in the following v/ords: 

"In many cases, although there is no overlap'^ing of the 
codes_ involved, still a single concern may find its oper-tions 
covered by two or more codes (multiple coverage). li?hile this 
tjroe of case is unavoidable where interrelated businesses are con- 
ducted by a single concern, still confusion and hardship may ai'ise 
where the operations carried on are not or cramot --racticably be 
segregated." 



(*) A'T endi:: Ho. 



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-5-- 

This Office I.^eraorcmd-om will pe discussed at £;reater lengti in a 
later ciia;?ter, but at this noirxt it-'-is-to he noted thp.t it is dated 
almost fifteen mnntiis after the h.I.F..A. went i.;to effect ejid that a.s 
yet there had ap^oeared nov/hex'e in tire adniinistrative' or policy state- 
ments of lir.A any analytical se{.jre£i\tion or classification of the tj-npes 
of nraltiple code covera;:e acttially ae'i in the achnini strati on or codes, 
nor does there seem to have oeen pxrj official reco:;nitiQn of- the 
existence of the d.ifferent ty^es. 



980G 



-6- 

CHAPIER II 

EVOLUTION OP POLICi: AlO OaOMIZATIOlI . 

There is proba'blj'- no better vcy to visualize the f^rowth of admin- 
istra.tive ■^Drobloms and the evolution of •jclicy and orgnnizp.tion to deal 
with them than to follow? the issuance of Office Orders and Henoranda. 
In doing this the reader should realise, as stated in the preceding 
chapter, that the early efforts of administration were devoted to put- 
ting industry under cod.es just as fast as that coiild "be done. Details 
'^ere left for settlement vihen and as they arose. This policy of getting 
men back to '7ork first and letting the details take care of themselves 
was deliberate. 

The evolution of policy and procedure was so rai-jid that it was the 
general practice for aoolicants for codes to model their presentations 
ix'oon the r.ost recentl"' a-rv.roved codes that were akin to their own. This 
practice speeded up operations during the rush days undoubtedly, but 
its repercussions were many '-^hen the period of code making was super- 
seded by the iDeriod of code adjnini strati on. 

As nev codes -'ere negotiated, industry re-ore^entatives found it 
increpsinglj'' hard to writo definitions for their industries which did 
not meet ^.7ith objection or protest from others, Ma,ny code authorities 
tried to include a:", many enterprises as possible under their jurisdiction. 
Enforcenent of Irbor provisions was pressed. Active efforts were made 
for the collection of assessments for the financing of code a.drainistra- 
tions. The forces rnd influences of partiCTilar interests, and of their 
opponents developed rapidly. Forced by the situations arising from such 
ma.tters and with numerous other problems, N.R.A, found it necessary to 
frequently revise orgnnization, policy ai:id. oersonnel, and to lay down new 
regulations to keap pace with ex>Derience, 

Thus, ■'onder circumstances which •■ere the outgrowth of the primaiT 
policy of "codification first; details later", the effects of such policy 
as to the subjects of this ^tudy may be traced through 1I,R,A, Office 
Orders ajid Office Ilecioranda as follows: 

Office Order Ho, 8 , issued July 31, 1933, dealt with the -oolicy and 
plan for the distribution of the iI,R.A. insignia (the Blue Eagle) as a 
symbol of compliance. It required for the issuance of the insignia to 
an eroployer a certificate of compliaxice with the industry code, if there 
was one, or vrith the provisions of the Prasident's Reemployment Agree- 
ment, This c.-'lled forth many questions fro:i enterjsrises as to which code 
they belong ■under or as to the form of agreement, as it was modified for 
prrticiilar industries, they shovild enter into. The Order, therefore, 
marks the emergency of the adiainistration problem of classifying enter- 
"orises. 



9803 



Office Order ITo. 36 . issued October 17, 1933, contained instructions 
governing the transfer of jurisdiction of particulrr codes from one 
division of IT.H.A. to pnother '^hebi in the interest of more efficient 
administration. Thera is in this Order the hint of grouinr's pro"blems 
of codification and alninistration, due to the lack of an -adequate pat- 
tern upon rhich codes could 'je classified industrially and ^^iven their 
pro^Der olace in the a,dr:ii'ni strati on 'ilnn at the stai-t. It '-'ps evidently 
being discovered that hitherto xmsuspectec. relationships het'Teen -"arti- 
cular industries made it advisable to bring certain codes under the 
same administrator. 

Office Order IIo. 38 , dated October 24, 1933, contained two sec- 
tions: Section A dealt with the constitution of code authorities and 
Section B with code procedxire, by "hich was meant the proced.ure of code 
formulation. Considera.ble ijxfornation Tas given, but without any men- 
tion of the desirability of controlling or even guiding the formation 
of definitions of industr;- uoon any broad plan of industrial classifi- 
cation. Some idea, of sepr,rating i :dustries into groups havin": inter- 
ests in coTijnon or touchin ■ upon one another was in process of evolution, 
however, as evidencedby: — 

Office Order llo. 3 9. issued October 25, 1933. This established 
four industry division;; pnC px> ^ointed a division administrator in charge 
of each (later orders increased the number eventually to twelve). In 
the light of present ]niowled ;e it may be seen tha.t the industrial sub- 
divisions adopted by the Order "ere still little more thaji a, convenient 
arrangement. Plainly the groups v/ere not assembled with ajiy idea of 
industrially classifj'-ing code sci ilicants to a pattern consistent with 
their normal industrial a.nd commercial contacts. 

Office Order Ho. 53 . December 29, 1933, authorized Deputy Adminis- 
trators, under the supervision of the Division Administrators, to raaJce 
interpretations of codes. This resiJLted at times in the interj^retation 
of the definitions of certain industries and tra.des in such a. way a.s to 
vitally affect the 'interests of other industrial grcuos, sometimes creat- 
ing conditions of overlap with other codes. Of the consequences of 
these infringements the Deputy making the interpretation was frequently 
unaware. At tine the Deputies interioretations had the effect of requir- 
ing individual enterprises to subject themselves to the provisions of two 
or more codes, thus bringing about multiple code covera.ge. 

Office Orr.er Ho. 54 , dated January 5, 1934, contained the first in- 
struction under which a -^erson affected by the provisions of codes other 
than the one under which he was operating, had the right to object to 
such orovisions a,t the i:)U.blic hearings in which they were being consid- 
ered. The order deals directly with one of the first of the problems 
of Iiulti'DlG Code Coverage. It recognized the ■:)OGsible effect of the code 
of one industr;"- upon the interests of other industries or trades and 
specif ica,lly referred to "codes for manufacturers which affect the terras 
and the conditions of sale to retailers and other distributors," The 
Order was not limited in its operr^tion, however, to this class exclusively. 
Deputy Administrr.tors were adinonished to see that "in every -way possible 

every code may deal as equitably as ^oossible with the rights of 

others." This in affect was evidence of the need to reconcile conflicts. 

9808 



The 'br.sis for such reccncilir.tion -t.s, honever, left entirely to the 
discretion of the De mt/ Adninictr; tors, for no specific -policy of 
-orocedure uoon xrhich to "base consistent r..s lyell p.s ecTu.itr.ole decisions, 
T7as annotmced. 

Office Order lie. 55 . issued Jr-nup.1-7 6, 1934, reor^c^ni^ed the 
Policy Borxd crerted 'oy Office Order IIo. 35, of Septeribor 16, 1933, 
It was the duty of the 3orrd r.a reorganised to advise the Administra- 
tor on all raatter3 of ,.;eneral policy. It nas to act uoon matters 
Tjlaced before it hut only after the De mty Adjiinistrator had consulted 
his Division Administrator and the Division Administrrtor had decided 
that he could. not make a decision hased upon entnhlished precedents. 
This procedure did not -prevent the inakin.; of -policy decisions hy De- 
puties or their Division Adninistrrtors r-hich '^eie, in their o-Dinion' 
based uoon jrecedent. 

Thus was the on ^ortixnity still presented for the prOi-nul Ration of 
policies, interprota.tions, e.:q3lanations or other tyocs of administra- 
tive action in one Division rithout regfU'd to those which night have" 
been mrde in sinilar or oo.rallel cases by some other Division. Here 
'■■as no ending of the problem crertod ^oy differing adjiinistrrtive points 
of vio'-'s rjnong those through whom liSA made its conti-acts with industrjr, 
out of which ).mch industry criticism of '.TA grev;. 

Office Order Ho, 53 . issued Jrnurry 13, 1934, set uit a number of 
conm.ittees under the liEA Polic;,^ 3oard for the pijir-jose of ejcpediting 
the conoleting of ,all codes then on file. 

One of those xrrs r "Coordination Connittee," whose function it was 

"to coordinate the administration of ai? jroved codes 
by the several industries in order to insTire' iniii orm 
tren.tment of the following -oroblens throughout the 
organization: Interrretfti "ns, Exceptions, E:ce:rption3, 
ilodif ications pnd Additions to ajoroved codes, a;id the 
• "oroblem of classification arising under aiy^roved oodes," 

Notice here that throu{;hout thin Order e-mh.asi.T '-'as ^Irced on the 
fa,ct that the coordinrtion con littee w^s not instructed to do any coor- 
dinating as a ->art of the fornulation of codes , but was to fxinction 
only .--'.fter codes liad been approved . 3ut a r)lan for coordin'-'tiPn of 
codes during the process of foriralation been out into effect, much of 
the subsequent need for coo'rdinat'ion rrisicig fror. the Overlapping 
Definitions of Industries and Trades and from canes of nultrole Code 
Coverage v/oulu lirve oee^i pvoided,' 

Office Orv.r ITo. 59 , d>atad Janu;'ry 15, 1934 estrblished the pro- ' 
ced\irG to be followed b;' all divisions in ruling on "cl; ssif ication 
problems" ""nd defined tne ter^-i a;; (l) "Pioblems arisin . -here nn enter- 
prise because of the diversity of its prodiictn or because of overla, riin, 
defintions, is covered b;/ -lore than one code" rnd (2) "Problems aris- , 
ing where it is doubtful whether ,'in indusir"/ is included imder a code 
or v'hother ai onto:,prise i:; included under an industry," 



9308 



•6 



-9- 



Ttto methods of -■rocedure ^vcrn sot forth: 

(a) TJhere codRs in cno l.'.R.A. indastr-/- division only were 
involved. 

(b) TJliere codes in more tiirn one il.R.A. induGtr-'- division 
Tere involved. 

Under "both nethods of procedure irohlens iuvolvinc the overloro Ding 
of industry' or tr'-'.de definitions nould, require cons ider^.t ion. IThere the 
definitions in conflict nere in codes under the same Division Adminis- 
trator, the letter's ruling xips finrl, suhject onl:^ to the disojp'orov^.l of 
the AdjTiinistrator. TTliere codes in nore thp.n. one industr;- division rrere 
involved, no final ru.lings co^-ld he p.p.de c::ce;5t hy the Aduinistrrtor after 
ottaining the recomendrti'^ns of ti^ie code authorities. Htilincs finally'' 
agreed uoon hy the tno divisions i:\ char::^e of the codes in conflict ^ere 
not required to hrvo the a roroval of other ITBA divisions or even to he 
na,de ImOTrn to the:', although the interests of the latter nay h"ve heen 
vitally ai^fected. 

The "orohler.is arising fron the ovorla j -^in::; ,o:' definitions or the clas- 
sifying of entor-jrises referred to in the order ■^lalnl;,'- ^-^ere United to 
those cr.ses occurring after the codes had been ajjroved, indicating tha.t 
there vt.s not yet in the ninus of those res-.)Onsihle for "djunistrative 
policy pny ider th,at dj\ effort should he n"de i^o sqIvo classification 
jrohlens during the :«eriod of code lornulrtion. The ad-iinislrative 
planning seems to hrve heen for the uir )oae of co.ri-.ecti-^.g difficulties 
rhich he„d occurred and not of oreve iting th'^ir o•.curre?^ce. 

Office Order Ho. 65 , issued Janu'-.ry 31, 19G4, records the fact that 
"too many codes are heing .■re;.:;entec. to thf Adiainistrator for ap^^roval 
vhich de-Dart in one p-o-ticul.- r or mother froi-; aeternined jolicy. This 
is esiaecially tri.ie of hour ana -^'af^o .-jrovisi ns." It contains directions 
for the coordination of 'the provisions of different codes and '7arns 
against the euh-^rrass ien.t to rll concerned that na^'- ensue ^rhen die mty 
administr -tors and indiistry representatives -^er^'-it the u-:-.e of phrases 
and pa,ragrephs i;i code fornulr tion v-hich r.re later foiuid. unacce-itahle 
to the ap-oroving officer. This, it stf.tss, is usually the fault of in- 
dustryp the reined^'- "lies in coordinrtion of -policy and '-ork," 

With industry, undouhtedly was at fa.ult in ma:ay crses, the iiEA 
T.'as not entirely without a share of the fruit. It '.'p:j a. connon practice 
for those in IffiA contacting industr;- in the fomulation of codes, to 
determine individually the tonporary acce^Dtihility of proposed code pro- 
visions, thus havin; ; the question of subsequent -iodif icr.tion or deletion 
to the processes of final adjii.iistrrtive a>5rovrl, Moreover, Division 
Administrators did not in nunerov.s instances coordinate their milings, 
intei^Dretations, chrnges of -nhra.sing, or other imortrnt rctions •'.-'ith 
the rctions of other divisions. 



9803 



-10- 

Office Order IJo» 66 . dated I'e^^rv.rrv 2, 1954, lie.-ins -ith the state- 
nent thc.t 

"Trade practices incor 3or'- ted in codes usually deal 
effectively ^-ith t)ie rel: tiojiships iDetTreen all en- 
i^loyers or entemriseG subject to the codes. On the 
other hand, .the .equally im^^ort-'^jit relationships "be- 
tween .ji-oduction-en iloyers ;.:\-A distri■bution-era^^loyers 
who pre i.inder different codes hrve not "been dealt 
with to pjiy e::tent " 

The relationship to rhich this order c--lls atte;-ition -"rere one of 

the sources of the problems of nultrole code coverage, and the suggestion 

in the order for procedure for the handling of trade -practices in such 
C8-ses is £1 pecognition of the problem. 

Offi ce Ilenorriici.uin of February 5. 1954 called attention to cases 
^liere employers or enter irisr^s rojprently ,:coverned by t^TO or more codes 
Mere advised that they coiild elect to abide by that code Trhich governed 
the O'l^erations in nhich the largest nunber of their em-oloyees were en- 
gaged. The memorandur.i declared suci;. rulings to be improper rnd reauired 
that thereafter all crser, of this ]:ind should be referred to the Coor- 
dination Comiittee (*). 

Office Order IIo. 63 . issued Pebruary 8, 1954, created a Heview 
Division, the principal function of 'jhich was to check all administra- 
tive acts of the li.E.A. organization as to policy and consistency be- 
fore they receive fornal signature. By this time the organization 
had grown so complicated and the lack of coordination was so apparent 
that some authoritative form of central review and control was required. 

A Division Administrator might appeal to the Coordination Committee 
?.s to cnj recommendation fo the Review Division, including decisions on 
the cla.ssification of individual members of industries and trades. The 
position in which the Hevie'- Division was ;olaced in the organization 
procedure gave it no leadership in matters affecting for eriample the 
classifying of enterprises, but its rtateiients about the provisions of 
a document Tvassin--'; throUf;h a.djninistrative channels coming as late as 
they did freq;aently resulted in the necessity of reopening negotiations 
with industry, with consequent administrative delays. 

Instructions were given by the order, to all industrv divisions to 
(among other things) refer to the Revie'-' Division 

"all correspondence from members of industry re- 
questing decision in matters of cla.ssification 
where classification w.-\r. in doubt." 

Multi'ile code coverage questions were subject to this i^rocedure since 
they frequently tied directly into matter' of "doubtful classification." 



(*) Office Order Ho. 58 ante. 



9808 



'-ll- 



Because the order required reference to -the Revie" Division of 
only those natters of classification in, which .the classification was 
"in doubt" exce-ot -hore more than one industry division was involved 
it was sometines discretionary and de-oendent upon 'whether the divi- 
sion adriinistrrtor or his deputies thou^-^ht there was doiiht, whether 
some of the cases of classif icrtion ever crme to the attention of 
the Revie'-' Division. 

Since there was no effective coordination of the industry divisions 
for the reconciliation of classification prohlems other than through 
the Review Division and the Review Division was "by no neans certain that 
all classification prohlems would come to its attentio-i, it will he seen 
that no com-oletely coordinated control of classification problems was 
established by the order. The lack of such control continued to em- 
barrass effective adrainistrr.tion throu^jhout the life of iSil. 

Office Order llo. 74, dated March 20, 1S34, i-'as entitled "Reor,:^aniza- 
tion for Code Administration." It had no direct reference to any of the 
problems relating to classif icr tion Lut "p.s i.rportant as formally mark- 
ing the time when theamhasis of administration "ts lifted from code mak- 
infe- and placed uoon code ac^Jiini str ati on. It thus marked the close of 
the more active leriod of codif icatxon and err^hasizing the importance of 
the administration of codes, it mt into effect revised olons for com- 
pliance and enforcement; code ruthority authorization, organization and 
procedure; ajid N.R.A. pcljninistrrtion, including the functions of the newly 
established labor, trade prfictice rid code authority policy boards the 
last of which wrs also to consider problems of classification, overlapping 
and conflict of codes. 

Office Orde r IIo. 75 . dated March 2S, 1934, bore the title "Procedure 
to be followed by all Divisions in Ruling on Code Administration Problems." 
The order defined interjore tat ions , exceptions a'ld exemptions, modifica- 
tions and classif icatio 1 problems. The wording of these e::amples was 
taken directly from Order ilo. 59. The comments given here will refer 
particularly to classification problems which were defined as in Office 
Order Koo 59, previously referred to. 

The division administrators ^ere given the authority "subject to 
the disapproval of the Administrator" to riile on any classification 
problem which did not involve codes in more than one indxistry division. 
Under classification problems were included' "problems of definition, 
conflict and overlap," Uith respect to these, this Office Order indicated 
the continuance of the same condition upon which comment has been ma.de 
under Order Ho. 63. The definitions of industry or trade in the codes 
clearly made or in the process of raaJring were still not scrutinized with 
a view to fitting them into any consistent classification plan, nor had 
Multiple Code Covera/^e as such been recognized 'o-j official pronounce- 
ment. 

Office Order ITo, 75 . dated March 26, 1934, was entitled, "Procedure 
to be followed by all divisions in obtaining policy decisions governing 
code making." Its subject matter was indicative of the trend of the 
administrative effort toward better organization. The heed of a coordin- 
ation of the policies of II. H. A., to bring uniformity an'd consistency of 
purpose into the decisions and administrative acts of the deputies and 
9808 ■ ■ ' 



-12- 

their p.ssistaiits , wrs plainly in mind. It is ppxticularly significant 
thrt their oruer vo.o addressed to the -^rocedixre governin-: code makinr, , 
in contrast to earlier orders nhich laid ern-phasis exclusively upon the 
hp,ndlinf^ of xrooleins rfter the codes had oeen nrn-oved (*). 

Office Order Iio. 85 . issued April 9, 19o4, marked the first general 
delegation of executive authority hy the Administrator. It created a 
staff, the raerahers of '^hich were to act in the npiie and -dth the author- 
ity of the Administrator in regard to suhjects assigned to them. An 
Assistant Adi^iinistrator for Policy was to be one of the Administrative 
St."ff, The duties of his position v/ere described to include 

supervision over -policies governing (a) em- 
ployment problems, (b) trpde practice problems, 
(c) code authority and classification problems. 

The last \7as further described as including all Questions involving 
provisions of code other than the labor and trade practice provisions 
thereof sjid, in rddition, 

"any miscellaneous problems not included in (a) 
(b) above rind nnt specifically assigned to eny 
other Staff I!e;.iber." 

Tv._-)ical of these v/ere -nroblems of classification, overlapping and 
conflict. The order appointed three deputy a.ssistant administrators 
for policy, one of nhora "as assigned to each of the sub-divisions (a), 
(b) and (c). ■ 

To ai^preciate the administrative situation at the tine a:ad to gain 
sbme idea of the pro;3ortions of the clrssif icatio;i oroblem ^rrhen this 
unit T7as created, it is pointed out that 'vhen Order Ho. 83 waP issued 
there were already in force 393 codes, ilany question,s hrd by that time 
arisen as to code- jlirisdiction over the opercitions of particular enter- 
prises and whether the jurisdiction should be partial or comiolete. 
Little coordination between L'.H.A. inO.ustry divisions hrving the codes 
in cha.rge had b'^en renuired during the jrocess oi" code formulation. 
Comolete coordination ^r.z not effected throuf;h the office of Deputy 
Assistaiit Adiiiinistrrtor for Code Axxthority rnd Classification problems; 
in fret the provisions of Office Order llo. 83 did not require it. 

Problems of classification, whether involving one or more than one 
code, did not necessaril;"- rpach the De-oUty Assistant Ad-ninistrator so 
long as the codes involved ^.'ere under the jurisdiction of the sp_me divi- 
sion a,dministrr,tor. Only tliose canes of code conflict which involved 
two or more administrative divisions '-ere trriisferred to the jurisdiction 
of the Deiputy Assistant Adjiinistra.tor for Code Authority sad Classification 
Problems. The De outy Assistant Administrator '-ps empowered to recommend 



(*) See abstract of Order lfo» 58 ante. 
See abstract of Order* llo. 63 ante. 



9308 



-14- ■ 

1935, there -.'ere 67 cases nore thnn 30 days old in process of determin- 
ation PXiA. still -ancon-oletod. T-^elve of these -'ere at least 240 days 
old and in this ntijnoer -rero four thn,t -'ere 285 dsys old. This rail 
give some idea of the difficulties rrhich ■rere nt times encountered in 
atte':rotin;;j to settle ;,:)roolejis involving;; overlap -inc of industr;/ defini- 
tions and conflicts as to tho cover;v;e aid jurisdiction. (*) 

Office Oraer 1-To. 108 . iasuod August IS, 1934, -.'ps a special instruc- 
tion that opened still mother loo.ohole in the administrative fabric. 
It authorized the Chief of the Com-jlirnce Division to act with the author- 
ity of a division administrator rhen in the opinion of the Assistant Ad- 
ministr.-'tor for Field Adi-iini;:.trption a reouecit hy a State Director for an 
explana.tion, interpretation, exception, CMerrotion, or clgissification . was 
not acted on hy an industry division r/ith necessary proin"otness. 

This order, rlthoxigh issued to avoid delays impairing effective 
administration ooened the door to the lifting of some of the most impor- 
tant fnjjictions of administration out of the hrnds of those presumably 
best qualified to handle then by delegating parallel authority to mother 
division. 

What provision was :.irde for the control or coordination of the t-ro 
groups thus enjo'-'ered to exercise the same jurisdiction is not apparent 
from the record. The order creatin;: the dual res jonsibilitj'' made no men- 
tion of coordination. 

Press 5:elep-:;e ho. 7482 . of August 27, 1934, (**) was the means of 
annoimcing an e":trei]ely irnortant reorganization of the 1I«E»A» for the 
purpose of adjusting code groupings to ah industrial classification plan. 
This plpji, it r'ps stated, had been fully revised to accord with the 
best thought in the organization. 

The industries md' trades of the country viore to be grotiped under 
ten or eleven ¥.E.A. divisions, within v/hich v/ere to be t^-'enty-two 
sections (***), 

The press relerse ercplained the reasons aiid "orocedure for the 
chmges. In ;oarticular, the statement was made that the IT.R.A. did not 
propose thp.t industry sloild consolidate its codes into the twenty- two 
section "Master Cla.ssif ication," but it "rs pointed out that the classi- 
lica.tion was 

"bpsed on naturr.l definitions of industries and 
trades as written hy the industry and trp.de 
groups thereunder " 



(*) See report of Committee for Studj'- of Administrative Proced\xre, 
imA files. 

(**) Aopendix IIo, 8 

(***) Office Hemorandum IIo. 345, issued liarch 16, 1935, fixed the I'ffiA 
divisions at twelve. 

9808 



-15- 

The effort here rras to move ever.y existing code into a r^lace v/here 
it -70111(1 fit into a -olanned classification, according to its orrn defi- 
nition of industry or trade. 

Office liernrQandi iu l io, 232 , (*) issund Augi.ist 27, 1034, the sane 
date a,s that of the press release descrijed aljove, and dealing rith a 
closelj'' relrted suhject, contained the follordng statement: 

"ITe iiust o.void future overla voia,'.: hetv/een different 
codes .-^nd cu:'e situations in i7hich that condition 
now exists ." (**) 

This T7as the first tine that an ar'jninistrative statement made a, 
fundamental ai:iproach to classification matters rjid announced aji adminis- 
trative plpii looking to the avoidance of overlapping of code definitions 
at their ijiccTtion as vrell as to the cUre of ca.ses already existing. 
In this raenorandun nas also the first mention of the term "llultiple 
Code Coverpge." 

Office Itemroandujii ITo. 345 , issued March 16, 1355, recorded the 
change fro:: numher designatio : of the industr^r divisions of the ".H.A. 
to designation h,:" nrne, listing eleven induGtry rnd trade divisions 
and a "Public Agencies" Division. 



(*) Appendix llo. 3. 

(**) Underlining is the author Is. 

9808 



CHAPTaa I II. 

OlSRLA PFUCr D5FI:'IT IG1TS 

I. HEAlMllTG &? T^IE Tiiai 

There ar'? throe PrDressicns: 

(a) "Overls.noin;?; Codes" ¥fpre those which "by definition included the 
s-rae Troducts or activities of industrips' or tr-^des. 

(h) "OverloiToing Definitions" v-ere the cmse of "Overla'TDing Codes." 
A;iy definition in any code rrhich '-'as so '--orded as to reach into 
an srea of industry or trade also allocoted to sone other code 
iTas said to "overlpp. " 

(c) "i,?altiple Code Coverage" as used herein refers to cases where 
an individual enterorise ^.-as subject to the provisions of more 
than, one codie, 

A stud.y of the code definitions of industries (*), of the files of 
the Assistant Administrative Officer for Classification Prohlems (**)t 
end the classification filns of the "'.P.. A. Industi-,y Divisions, is the 
hasis for the statement that ".aixy of the industry d.r3f initions contained 
in approved codes ';ere dra'^ia nitho-o.t saf 'icient orecision or delimination 
to avoid ovprlapTiU;'^ or conflict -/ith the aporoved codes of one or nore 
industries. In sdne cases a angle c.efinition overlapoed those of ten 
or raore other codes. 



Probahljr the i.iost complicated cas=s --ere in the "Tlaolesale Trades, 
In E. C. Alexander's article "Overlapping in the Codification of Whole- 
sale Trades" (***), the ianlt is placed at the door of 'J,1..A., because 
K.Tl.A. adtooted "no verj'- sensible or carefally considered -lolicy, " 

The following is a qaotpticn from this article: 

"Thus if a code defines 'the industr3'-' as 'the business of 
n/anufacturing an item -nd selling it by the raanuf -cturer • , 
that code orobably governs sales made by the iroducer direct 
to the retailers or consumers. If, on the other hand, 'the 
industry' be defined as the 'najiufacture for sale' of a laar- 
ticular item, there seeras doubt as to whether the code in- 
cluding such a definition governs the direct-to-retailer 
selling activities of nanuf acturers. A great diversity of 
language on this -noint is found in the different codes," 



(*) Records of the Post Code Analysis Unit "Definitions of Industries 

and Trades under Approved Codes" - Central P.ecord Section :v.E.A. files^ 

(**) This office w-is cre-^ted after the abolishing of the office of the 
Assistaiit Administrator for Policy. 

(***) H-^rvard Easiness P^view, Soring, 1935; e-:cerpt, A-opeadix No. 4 hereof. 
3808 



-17- ■■ 

The article further states thpt 179 oo^es eovernin^ sales by nrnu- 
facturers to retailers there were fifteen v^Tiations in the phrasing. ^ 
In 170 codes on the sanie 'sutiject there ^ere eit^nt variations in phrasing, 
so uncertain as to intent as, in the or<inion of the author, to reouire 
interTJretations. In forty- three cof'es there were twelve diffe^-ent nhras- 
ings of the definition of industry, -vhich "n; y include Vnolesalers. " 

Mr. Alexander's criticism of the early methods of writing defini- 
tions is suToorted not only by his citations hut by numerous other cases, 
of which the following are recited as aD-oro-oriate exan-nles: 

(r) Electrical Workers Union of New York City versus General Hail- 
way Signal Company. Tae codes involved were the Electrical Contracting 
Division of the Construction Industry and the Tlailway Safety Apr)liance 
Industry. (*) 

(b) Cotton GTrment versus Rainwear Division of the Kubbe-^ Manufactur- 
ing Industry. The codes involved were those of tiie Men's Clothing, San- 
itary and iTater-proof Specialties, infants' and Children's "ear. Coat and 
Suit, Rubber Mamif acturing (Rubber Sundries and' Rainwear Divisions) and 
Cotton Garment Inciustries. The ouestion in this case was one of industry 
Jurisdiction and the right to regulate the manufacture 'ind the marketing 

of short jackets made princroplly of suedine, rubberized material, and 
the manufacture of cravenetted garment?. 

(c) Furniture Manufacturing Industry versus Tardwood Dimension 
Division of the Lumber and Timber Products Industry. The codes involved 
were those of the Limfoer and Timber P-oducts (Hardwood Dimension), Furniture 
Manufacturing, Ornamental Moulding, Carving and Turning, Shoe Last and 

Shoe Fo:i;m, Wood Turning and Shaping and Funeral Sunr>ly Industries. This 
case originated on com-nlaint of the Furniture Manufacturing Industry that 
products included in its code definition, and the-^efore -under its juris- 
diction, were being mtinufactured by another industry which had more favor- 
able wage and hour T)rovisions, thus creating unfair competition. This con- 
troversy continued ever one and a half years, with a record of almost con- 
stant effort at adjustment and '-'ith gro-iing acrimony. According to state- 
ments of Deputy Administrators of the two Divisions in charge of the codes 
primarily involved,, the viewpoints of th- se in the V.R.A. who we're con- 
cerned had become so partisan tiiat they recognizer" their inability to 
carry the efforts at reconsiliation further. This brought about a public 
hearing before a specially ap^-^ointed, imnartial deputy (**). 

A tynical example of a code definition of industry of ^'ide coverage 
is contained in the code of the Automotive Parts and Eouipment Manufactur- 
ing Industry. It is auoted in full as follo^'s: 

"The ter.n 'Industry' as used herein is defined to mean the 
business of the -oroduction and/or manufacture of automotive 
ptirts and/or eauipment, ccnrirting of r.utonoUv? original 
equipment, automotive replacement parts, automotive ac-eess 
cer-sories, autcmotivr" pIiot) eauipnent, automotive 
sei'vice tools, a-atomctive chemical ?,pecialtics, auto- 



(*) Analysis of facts and arguments, Apnendix I'o. 5 

(**) The records of this hearing and the decision of the demity are in 

¥.R.A. files. 
9808 



-18- 

raotive electrical i:)rodij.cts, internal- combust ion engines ex- 
cepting aircraft engines, such other allied products as 
are natural affiliates, including industrial, marine, and 
aircraft parts, units, pjid/or equ.ipnent, which are or have 
oarts kindred to this autonotive parts and/or equipment In^ 
dustr:'-, e::ceoting ho^;ev"r, the prod.uctinn and/or manufacture 
of such articles as when produced or nahuf -" ctured hy a man- 
ufactur(-ir for u.se p::clusively in his own finished "oroduct, 
and e-cepting the business of manufactu.ring ajid/or producing 
rubber tires and tabes and other rubber oroducts incliided 
in the Code or Codes of Fair Con-Detition for the Rubber In- 
d.uEtry, and excepting the orodvicts included in the Code of 
Pair Corroetition for the Electric Storage rnd. let Primary 
Battery Industry." 

T'iis definition embraced practically ever3'- part entering into the 
manuf<\cture of an automobile or internal conbustion engine. It cut di- 
rectly across the industry cefinitions of at leabt twelve codes, all of 
which were approved "irior to it. The definition was so all-inclusive as 
to mal:e it practically impossible for certain industries engaged in ne- . 
gotiating codes to describe their o^m activities without conflict. 
It definitely crossed the industry definitions in the cod.e of the Fab- 
ricated lletal Products Indur-try and nan;;'- of its Supplements, the Foundry 
codes, and those of the Electrical Ilonuf acturing. Gear lianufac taring, 
Lumber and Tiraber Products, Machinery and Allied Products and other in- 
dustries, nujnbering in all al loct fifty. 

These are a few co.:.-'^s, illustrrvtive of the" effect of allowing code 
applicants much lee^'ay in the defining of their own industry boundaries. 
For other QX'3iTOles the read.er is referred to Appendix 6. 

III. FlTJDAElvTAL CAUSES 

At the root of the troubles which came from Overlaopj.ng Definitions 
of Industries and Trades \7ere four funde:iental causes viz., 

(a) The II.H.A. policy of getting i ndustries codified with all 
possible speed, in order to out men back to work, but vTithout a pattern 
of industrial classification upon which to b'oild a coordinated code 
structure, 

(b) The abse-.ce, at the start, of a:\ adequate cor.cept of the pla,".- 
:".i".g :',ecessary to fit the codes i:\to related groups which would provide 
each of them a field of activity with mi' i mum competitive a"-d economic 
overlap. 

(c) Ir.adeqtia.te k:-.orledge of the effects or. cod.e admi-istro.tio:-. of 
the lack of coord.ir.ated co:-.trol of def i:-.itio:-. writi\g, as -oernitted i:'.- 
dustries i:: arcposi:'.g cod.es. 

(d) The early policy of givi-.g little thought to futiure adminis- 
trative difficulties, i;: the drive to speedilj'- codify i:-.dustry. 



9308 



-19- 

lY FEOCEDUEE 

The settlement of protleris arisi-.g' from the ovprlappi"-g of code def- 
i"itio:is of industries a\d trades ^s.s as coraplicpted and contained as 
ma:"^ ramif icatior.s as did the nrotlems themselves, &".e had only to think 
again of the administrative conditio:.s descrihed i r. Chapter I hereof to 
realize: 

(a) That no settled procedure existed, 

(b) That such procedure as did exist was not alwa,ys followed, 

(c) That any adininistrative process developed in. one industry division 
of JI,R,A» for the settlement of overlapping definition prohleras, whether 
good or bad, did not necessarily become IoiO'tti to any of the other divisions. 

As of May 27, 1935, n-hen the II. I, P., A. was declared illegal by the 
Supreme Cou.rt, numerous .problems of this type were still under consid- .i 
oration (*). 

The form which the settlement of an]'" case took varied with the tj'pe 
of the problem. St"ys were used to render in operative the ap'olication of 
code provisions of one'indastry or tnde to the operations of enterorises 
subject to some other code. A'iiendnents were made to some codes to avoid 
their conflict with the provisions of come other code. Interpretations or 
Explanations were used to clarify the intent of definitions and thus remove 
the claims of one industry u^Ton territory of another. Exemptions were 
granted to enterprises, usually upon the showing of undue hardship. 

At times the conditions were such that there vras no basis for ad- 
justment of conflict and activities of industries remained ujider the 
definitions of two or more codes. Where possible, however, Multiple Code 
Coverage was avoided. 

Some codes provided for the formation of com'-uttees whose duty it was 
to confer with similar comnittees of other industries in order to attempt 



(*) One case for example, was that of the TTalker Pratt Ilanuf acturing 

Company of Boston, Mass, Administrative Order 84-K-16, of IJovember 
23, 1934, was issued on recommendation of the Assistant Adm.inistrative 
Officer, adjusting a wage and hour controversy in a serious con- 
flict involving Multiple Code Coverage and Overlapping Definitions, 

The Order exempted the entemrise from the wage rnd hour pro- 
visions of Codes l"os, 235, 60, 277, 134, 84-M, 253, 137, 244^, upon 
compliance with wage and hour provisions of Code No, 4, with a 
complicated modification of its wage and ho-or provisions and the 
proviso that outside installation work be done unde'r the Construc- 
tion Industry Code, 

The enterprise refused to accept such conditions. It protested 
at length, February 15, 1935, and there is no record of any con- 
clusion of the case as of May 27, 1935. 



S808 



adjiistnent of any conflict of provisions (*). 

■JThere overlap'oing of definitions occurred and there were no means 
available of weighing rind settling the matter according to established 
iDOlicy, precedent or rule, it was customary to seek reconciliation bj'- 
conferences and adjustraents. These often resulted in a compromise ^■.■ 
which \ia.s contrary to the fundamentals, in the interest of expediency. 
In some cases settlement was by fiat. 

V. IICDUSTRY REACTICnS 

Industriallj'' the Overlapping of Definitions was a source of con- 
stant irritation, to which no end was in sight at the time of the Supreme 
Coui't decision, May 27, 1935. It presented continuing problems for code 
authorities. Industries whose definitions were not in conflict one day 
would become so the next. This was the inevitable result of the ever- 
shifting front of aggressive competiti'^n among individual enterprises. 
It was not to be erroected that industrie.s would be p,reve-nted from enter- 
ing into or dev°lo'oing new fields in order to IfPC) pace with the markets 
to which they could turn for profit. 

Industries were constajitl],- on the lookout to find oroducts v/hich 
they could produce or distribute o.dvantageouslj'-, but were required also 
to be constantly on the defensive a,gainst the efforts of other industries 
to affect such activities by ,jurisdicti''^nal claim.s zander the codes. 

In the majority of ca.ses the question of wages and hours was upper- 
most. To an extent thi^ was recognised in Office I'ieraorandura Ho, 282, 
issued August 27, 1G34, as well be noted from the follovdng extract from 
Section 3, "The fixceotional Solution":- 

" NOTE ; It will soon be possible .is a result of studies now 
being made to provide simrole v;age. and hour standards to apply 
to particular classes of work vdthin entire groups of kindred 
industries. When such hour and wage sta^ndards have been de- 
termined we can then exempt the non-segre gable operations for 
the group from the conflicting wage and hour iDrovisions of the 
various codes on condition that they comply with such simple 
wage and hour standards. This course will promote both justice 
and simplicity," 

That all wage and ho'or problems were not solved thus simply is 
vuifort'Linately a fact. The pri'".ci-ole was fine and was ap'oli^d where possible, 
There i's no record, however, that indicates a.ny a'oprcach to its general 
application. 

Having settled a conflict by ;.\ny of the Processes outlined, the 
next and frequently the more difficult task was securing compliance with 
the ruling, Com-pliance, however, is not within the scope of this report 
and will not be touched xxgon further than to say that enforcement _..,'- 

(*) Se.e Administrative Orders i"o. 5-14 nr4 wo. 34-50, dated Oct. 8, 1934, 
Dress Manufacturing Industry ajid Coat and Suit Industry. Also 
Supplements F, L, 0, Q,, S, end U of Code No, 201, 

9808 



■oroved to "be one of the --.ost difficult of the proTDler.s of adnini strati on. 

In -".ost of the cr-ntrover?ies thra"° '7'^r.e t:^o outctn.nding pttituces. 
The industry or enter ^rise in tho -po£.itio:i of conplainnnt castonarily 
pressed for haste and a "^rornt decision, ,as this na'^nt I'enoval of the 
coripetitive pressure or.- other circuMctanoe ;..hich originally ororroted it 
to hring the action. : The industry or entpjrprise, in 'the defensive -opsition 
might seek to del,?y and to otherTise continue'- the status quo as long o,s 
possible, an this neant a Ioniser enjG;;nent of competitive advantage. 

There are cases of record' in v/hic.h ri-^s-o.ohdent industries retained 
their competitive advantages, by ?st\i.te handling 'or other effnctive pro- 
cedure, for a yea,r and a, half, or pven no re from the tine of the original 
complaint. The reaction of the com-olainaait industry in cases of this 
type did much to discrjedit l^x administration as a uhole. 



S808 



-22- 



C':.4PTSR IV, 



LiULTIPLE CODS COVERA.GE 



Under date of August 27, 1934, Office Uemorpjidum No. 283, 
"Overlapping Codes and iiultiple Code Coverage", (*) stated the pro'clem 
of Iviultiple Code Coverage in tlie following words: 

"In many cases, although there is no overlapping 
of the codes involved, still a single concern 
may find its operations covered by two or more 
codes (multiple coverage.) 'iTaile this type of 
case is unavoidable where unrelated businesses 
are conducted by a single concern, still con- 
fusion and hardship may arise where the opera- 
tions carried on are not or can not practicably 
be segregated." 

liethods of treating such problems were then set out under such 
captions as "Tlie "Normal Solution"; "Amendment to i.ialce Provisions 
Identical"; "Uaintenance of Pair Competition"; "7/l^ere Segregation of 
Operation i ■". feasible"; "jlien Segregation is not Feasible"; "Hie 
Exceptional Solution." 

T-ie same general instructions and suggestions are given in the 
A'3A Office liaimal. III - 3322.2, dated August 30, 1934. Althougli 
both of these documents were issued more than a year after the approval 
of the Act by the President, no official contemporary record has been 
found segregating or classifying the types of multiple code coverage 
actually met in code administration, nor does tnere seem to ha.ve been 
any official recognition of the existence of different types, as such, 
at that time. 



I. BASIC Al^JD SUB-BASIC IIODUSTRY CCDIFICATI 



■^j\ 



In any industrial clc?,ssif ication there are certain basic group- 
ings, to ee.cli of which belong numerous "supplementary" or sub-basic 
industries. The basic groupings shoult?. be made a.bout those character- 
istics of operation which are coivanon to all, or nearly all, of the 
sub-basic industries. But all industries in a basic grouping may not 
have all their operations in coranion. In fact, they seldom can. 
"lad this been recognized by ISA it wou-ld seem t-.at there would have 
been early an effort to assemble more of the separate codes under 
basic groupings. Tnis statement is made with due consideration of 
the few rather obvious examples of such assemblies, as: 



(*) Appendix ITo. 3. 



9808 



-23- 



Code No. 201 - viholesnlint, or Distributing Trade - 24 stib-lDasic codes 

Code Ho. 244 - Constriction Industry . - 23 " " " 

Code No. 84 - ?;,bricated i.letal Products Uanu- - 62 " " " 
facturing and i/ietal Finis'.-.ing 
and I.letal Coating; Indubtry 

Code No. 275 - Chemical Manufacturing Industry - 3 " " " 

Code No. 105 - Automotive Farts and Snui-xient - 10 " " " 
Llrnufac turin 2 Industry 

Code No. 347 - Machinery and Allied Products - 47 " " " 
Usjiufacturing Industry 

Code No. 308 - Fishery Industry - 12 " " " 

As of May 27, 1935, sixty-six additional sup:pleraental or sub- 
basic codes had been submitted but not approved. All but nineteen of 
these were supplemental to one of the a.bove seven basic codes. 

Helpful a.s these efforts were in puttin^^ industries of similar 
ba,sic characteristics under comps.tible industrial regulations, they 
did not offer relief from multiple code coverage problems, wliich arose 
from the attempts of industries or trades to enlarge their fields by 
seeking markets wherever they could reach competitively, or dealing in 
any products their shops or factories or sales facilities could handle 
efficiently. 

II EXAIiPLES OF MULTIPLE CODE COVERAGE 

Under the broad title of Multiple Code Coverage there are numerous 
examples illustrative of NPlA. experience, but all were of one or more 
of the following types: 

Case I . IT.iere an enterprise prior to NPA did the minor part of 
its business in some "side line" Vv'-_ich constituted the principal 
product of another industry and \7as therefore subject to another code. 
Some enterprises in this category found themselves subject to the pro- 
visions of several codes which were in conflict in impcrti^nt respects. 

Case II. Xiere an industrial organization Y/as engaged in the 
manufacture of a large number of products, sometimes of a widely 
diversified natare. Organizations of this type generally operate large 
plants in different locations, each carrying on a. number of non-conv- 
"oetitive activities. Tliey sometimes found their activities within the 
scope of the definitions of more thaji one code. 

Case III. "iTiiere industries, on appli caption "for a, code, found 
tiiemselves free to a.cquire one for the " msjiuf ac t^^re " of their product, 
but the field construction , assembly , or installation of their product 

9808 



-24- 

was already covered Ijy an approved code. Some indu.stries in this ^ 
category included in tlieir industry definitions a statement that the 
installation work upon their manufactured :;roduct would he done under 
tlie code of t.ie other industry. Others were required oy rulings 
after ap-^roval of thr^ir code to confor.n to the provisions of the 
other code. 

Case IV. Vfliere enterprises were engaged in the manufacture and/or 
wholesaling or retailing of a wide variety of products of varying 
character and thus hecame suhject to tie requirements of a number of 
different codes. 

III. TYPES OF PHOBLELiS 

For the most part multiple code coverage problems were mani- 
fested: 

1. In the efforts of the code authority of 
one industry to collect assessments from 
members of aiiotier industry on the ground 
tl.a.t the latter V;erc prcduciiig or dis- 
tributing tlie products of t'..'.e former. 

Code authorities were active in their efforts to collect their 
expenses for code administration from every enterprise subject to 
tie code irrespective oi wlietier rctivities under t e code represent- 
ed one hundred percent or one percent of the toted business of the 
particular enterprise. In many cases the funds required to finance 
the application for the code and carry itthrougli to approval were 
advanced by a few co;.:panieE in an industry or by a trade association 
and it seemed reasonable to them to expect that the burden of tie 
expense of code administration sliculd be widely distributed ever tie 
industry aaid tius be more indico,tive of support of the code by the 
industry as a whole. Haese were knovm as "i.ialtiple Assessment 
Problems" and many of the.n engaged the attention of TIA to the end of 
code adaTiinistraticn en Liay 27, 1^35. 

2. In the difference in wage and hour pro- 
visions in the codes, of industries viiicii 
manufactured or distributed products com- 
peting for the saiae customer-dollar. 

It is Lisual for enterprises to manufacture several different 
products in order that plant capacity i.ip.y be utilized more unifornly, 
the cverl-ead expense distributed over a ^reater total of production 
and a reduction in t;.e cost of majiufacture of the individual items 
tiereby effected. Under the h.I.R.A. it \7as not unusual for differ- 
ent products made by one enterprise to be covered by different codes. 
Preo^uently these codes contained dissi..dlar mini.Tium vrage and maxim\-'mi 
hour provisions. iTixere this was the case, the maiuifact\irer V7as con- 
fronted wit;, the problem of so sepe-rating the workman's time a.s to 
comply wit', tie requirements of each code in tie performance of tie 
work done under that code, unless relief \/as accorded by t^e applica- 



9208 



-25^ 

Hon of tlie provisirn of T.R.A. Office I iemo ranclura ITo. 282, previously 
.referred to. (Appendix llo. 3.) 

;IV. EFFECTS UPOK Il.T^JiTHIES 

There is no doubt tlip.t bona fide cases of multiple code coverage 
were irksome to industry, but t.iere is ecrc^lly no doubt tliat tlie "ex- 
ceptional lia-rdsiiip" defen'se ajSainst compliance wit'.i tlie provision of 
.more than one code was of ten .used as a cloalc be'iind w'lich to uianeuver 
for a position of competitive advantage. : . 

Among tlie distributiu;;^ trades code relationsliips v/ere parti- 
ciiJLarly complex. For instance, there v/ere the "general v/holesalers" 
who distributed r, Y/ide variety Df articles majiufactured under differ- 
ent codes (*); nevertheless, manufacturers of these products, seek- 
ing the eradication cf evils in their ovm industries, set up certain 
fair trade practice ixovision^j of codes wliich reached definitely into 
th.e area of the wholesaler. ,Tlie burden of such conditions so affected 
operations of tie wholesalers as to reduce management and account- 
ing to confusion. For ex^->jnple, the wholesalers of hardware, dry 
goods, stationery and drugs, v/ho^e iteras run into the thousands, v/ere 
confronted v/itli the necessit.y of co iplying VYith from twenty-five to 
seventy-five different sets of fair trade practices, prohiibitions 
an d manc\a t e s ( * * ) . 

V. PHOCEDUSS; 

Cases requiring reccnciliaticn because of overlapping definitions 
or multiple code coverage were hfjidled under t'le general name of 
"Classification Problems. " 

It has been pointed out previously tiat the term "liultiple 
Code Coverage" did n: t come into official use until mere than a year 
after tlie approval of the Act and even then its full meaning vras not 
so clearly grasped that it could be made plain to others. 

The term "Overlapping" was also loosely understood and was 
frequently used wliere "liultiple Code Coverage" v^as meant. Confusion 
v/as added by the failure of momerous writers on classification sub- 
jects to differentiate between Overlap and l.ultiple Code Coverage. 
T.iis, after all, is not sui'jirising in view of the lack of definition 
within IT.H.A. itself, ileaders aaid students should not lose sight of 
this confusion, since it is present in one fon-n cr another in many of 
tlie N.R.A. records, and orders as v/ell as in lauch of the contemporary 
literature. 



(*) Good examples of tl.is are seen in the wholesale hard\7are. 
Drugs, Dry Goods, and Stationery businesses. 

(**) This whole s-abject is discussed in documents entitled 

"Codification of th.e Distributing Trades Uiider tie N.R.A. ", 
Parts I and II. (This is a history of the organization and 
administration of the Distribution Division, iJHA, with j 
recominendations of standards for an ir.ioro-ved codification 
plan.) - "3A files. 

9808 



-26- 

Adjustment of multiple code coverai-e lorotlems took many forrns, 
accordike to tl...e c.iarr.cter of tie questions and tl.e industries involved. 
At times 'the views of participr-nte were hopelessly apart. In numerous 
cases reconciliation was still far avay on May 27, 1935, when the 
Sa-:irerne Court ended the codes. 

Some cases were settled Dy a::reement in conference or hy IvT.R.A. 
n.ilin^s. \Tnen adjustment was rea^ched, the action was 'disposed of "by 
tlie issuance of rai order: 

1. Stayin:; the application of tie provisions of 
one code to an enterprise which was alrsf.dy 
operating under another code, or 

2. Amending code previsions to eliminate the 
necessity of operations under more than 
one code, or 

3. Interpretint: or explaining the provisions 
of a code or codes as applied to an enter- 
prise, or 

4. Exemptinji an enterprise adroady cpera^tinj^ 
under a cede from certain of t e provisions 
of another code or codes. 

rrequently code authorities ujidertc 1: to adjust conflicts re- 
sulting from multiple code coverage a.nong themselves, in preference 
to bringing their difficulties officially before the llIiA, appointing 
committees t^ sit as adjusters m cases involving their industry. (*) 

However, far as investigation I.b.5 disclosed there is record of 
only one case in II.?.. A. ex;;3erience in which tv/o industries laid down 
tliS principles by wliich. disputes between them involving f^Taltiple cede 
coverage were to be settled. (**) 

Tlie plan here v/as to establish liy agreement, v/ith 'f.'RL approval, 
t. .e principles upon the basis of v;?:.ich tie pa.rties (represented by 
three a,ppoint6es from each) v;ere to reach decisions on all contro- 
versies involving operations included in both the Construction and 
Cotton Textile Codes. If the representatives fa.iled to a.gree, an 
impartial member was to be .added to the panel and his viev/s were to 
be a.ccepted as the viev/s of the committee. 

Tlxcre was objection to this agreement on t.ie pea-t of HHA because 
it provided only for original approval by t-:e l^IRA. and did nnt give 



(*) For example. Administrative Orders LTos. 5-14 and 64-30, 
October 8, 1934, Dress hejiuf acturin,^ Industry aiid Coa.t 
ajid Suit Industry. 

(**) See "Al^i'eement by and between t.ie Construction Code 

Authority, Inc., aaiO. the Cotton Textile Code Authority" 
April 3, 1935, Appendix No. 7. 

9808 



"27- 

NHA any voice in tlie proceedings or t!ie ri&it of approval of committee 
actions. V/liile the a,greement lic-d not 'been approved on Hay 27, 1935, 
it represented tlxe i.icst advanced and genuinely cooperative industrial 
effort to solve nraltiple code coverage problems. 

VI. OUTSTANDING- ASPECTS OF lULTIPLi] C0D3 COVEHAG-E 

Multiple Code Coveratse was either little understood or was not 
considered wortiy of separr.te detailed study and planning. At any 
rate no basic, compreliensive study of its elements and its i.jportance 
to the industrial network v/as ever made. 

A. Lack of Clear UnderstaJiding of Term 

.Iny re/iew of outfstandini^ .aspects must start with the state- 
ment that Ilultiple Code Coverage wa^ never adequately defined. Tliere 
was from the first a misar)preIiension of the terr.i. This ignorance was 
so prevaJent that it is difficult to locate all of the comprehensive 
material on the subject which undoubtedly exists in the records of 
N.B.A. 

perhaps the most common error has been to refer to rnultiple 
code coverage problems as "Overlapping Code's." I.ianj'' of the actions 
of administration, siich as stays, exemptions and exceptions, amend- 
ments, interpretations and explanations, were utilized for the solution 
of multiple code coverage problems, but the records of these cases 
frequently are not identifiable as such. 

i;ioreover, there v/ere nuraerous cases which were so complicated 
or in Vifhich personalities or competition-jealousies were so strong as 
to defy solution under the limitations of the Act and its administra- 
tive machinery. 

Because of the absence of a well-defined aJid responsibly 
determined understanding of Liultiple Code Coverage, many problems of 
importance did not come before executives equipped to handle them 
and with the perspective essential tc their proper solu.tion. T-is is 
not to say that an answer equitable or satisfactory to a.ll concerned 
cov-ld have been found in every case. Dissa-tisf action could, however, 
have been' decidedly reduced. As it was, there were many cases weeks or 
m:.nths old still in process of administration at the close of the code 
activities, Liay 27, 1935. 

B. As Viewed by Industry and Trade . 

Multiple Code Coverage was viewed generally by industry as 
one of tl'.e complications resulting from the codif ica.tion of industries 
which would be a continuing problem for code authorities. This was 
c-Qrrect - for \7ith the ever-changing front of a.ggressive competition 
among industrial- enterprises a business opera.ting definitely under a 
certain code or codes could not take on new lines v/ithout a likeli- 
hood of coming within the Jtirisdiction of other code authorities. 



9808 



-28- 

In sc;.ie linss of "ousiness, i.ml.tiple code covera^ge problems 
were regarded as -ansclvable. A iood ezranple of tliis was recently 
stated at tlie public liearinsi; iield Cctcber 12, 1955, Title A, Labor 
Previsions of tlie Proposed Voluntary A£;reement for tlie vraolesale 
Tobacco Trade. (*) 

Mr. R. .1. Howe, Executive Vice-President of tl.e U. S. 
V/lxolesale Grocers' Association, testified as follows: 

"Under lI.E.A. codes tl.e v/.iolesale grocer was 
under bct-i t'.:e trade practice and v/age and 
labor provisions of four codes in addition to 
:iis cvm, viz., iT^iolesale Tobacco Code, vT-iole- 
sale Presli Fruit and Vegetable Distribiitive 
Code, the Paper Distributin,:; Code and the 
~i/liolesale Confectionery Code. 

The basic worl: week for the 'X olesale Grocery 
Code v/as 44 houra, with mini^Tum wages raiiging 
from 01 ^-■•50 to ',13. 

For the Vir-.olesa.le Tobs-cco Trade t ^ere was a 
40-hour week, with i.-iini.irora wages from (;16 to 
$14. 

For the Fresh Fruit and Vegats.ble Distributive 
Trade, 43 hours per week, with jainiiipam wages 
from $16. to $13. 

For t"ie Paper Distributing Trade, 40 hours, with 
minim'u,! v/a-t^es froi.i $15 to $14. 

For the ifnclesale Confectionery Trc.de 56 hours, 
with mininruui wages of n.5 per week. 

l/7e were supposed to be fible to comply witla the 
wage and la.bor provisions of a.li five codes. 
It was utterly i.apossible to do so. We V'/eve 
told by the IT.R.A. t.iat to.be on tlae safe side 
we should observe the hour and Y/age provisions 
of the most stringent code. This would 1-ave, 
of course, throvm us into the 36-hcur week 
and the $16 rainimara wa.ge of tlie Confectionery 
Code, to which we never assented and with which 
it was utterly impcssible to comply. 

This problem of overlapping, codes was never 
solved by tlie r.R.A. beca.usc in fact it was 
unsolvable. The wholesale -jr^^cery business 



(*) Transcript, ■:pe.r;e 12 et sen., I^IPA files. 
9808 



-29- 

"is dene as p. v.-hole e.nu only in rare, exce^itions - 
are f \ese various, co'-racdities segregated in 
cpere.tion. " 

"lote also t.at even at tliat lata date i.ir. 3ov/e calls liis 
■problem " overlap, ..dn^ c^des" alt^. ru.:;. it is a clear case of niulti;ple 
code coverage. 

?or reasons of simple self-protection it v;as necessary tliat 
code authorities "be ever alert to eapy competitive infringement upon 
tl..eir territory ''oj enterprises not txxoretcfore considered competitors. 
Generally m sucli cases tlie industry affected reccj:Tiized tlie riglit 
of tlie nev/ competitor to enter t>.e lists, but proceeded witli all 
possible vigor to get l:dm plpxed on an equal competitive footing by 
requiring liia to conform in all respects to the code of tlie industry. 

i/Iultiple code opex-atioo. ^-.enerplly inco-eased tl.e expense of 
management. Uany cases rcouired substantiad adjustment in tlie cost 
accounting system. (it is not witiin t'.e pm-viev/ of tliis report to 
discuss tlie compensations v.o.icli industry received under tlie Act, but 
tliey existed.) 

Probably (all evidence points tliat v/ay) ninety percent of 
iiiultiple code coverage problems v.'Ould have been eliminated if some 
v/ay lic.d been found to reconcile the factor? entering into the cost of 
prodLiction of competing ind'astries (competing codes.) Of these 
factors, wf.ge' and hours '.;ere of gre-.t impcrtance. Since this sub- 
ject has been developed in the chapter on Overlapping of Code Defini- 
tions of Industries ^nd Trpdes and the problems related to rnuJtiple 
code, coverage £.re much the saine, it v;ill not be gone into here.(*) 

An in the ca,se of overlapping definitions, many wage and 
hour problems caused hy Kiultiple code coverage vere still pending at 
the time of the 3c lecliter decision by the Supreme Court. The situa- 
tion in t'lis respect is indicated some'jhoit by tlie fact that between 
September 1, 193-1- and February 'fil , 1935 exemption orders were granted 
by IhR.A. in 79 cases involving two or more cedes. I.iost of tlie^e 
were adjvistments of wa-ges and hours. Two of them required an average 
of 407 days eo'ch for hraidling in K3A; two avera,:;ed 216 days; 13 
averaged 164 days; 11 toveraged 103 days and 5 averaged 107 days.(**) 

There '.vere numerous .'.lultiple code coverage cases, pe.rticular- 
ly in tlie distributing trades, where no final adjustment was ever 
reached during the life of the Act.(***) 



(*) See p>age -id et seq. 

(**) Report of tlie Comiittee for the studj^ of Achainistrative 
Procedure, Liay 21, 1935, 'kiRL files. 

(***) T.iis subject is treated in "Tlie national Recovery 
Administration, an Analysis and Appra.iseJ", The 
Brookings Institution, April 1935, page 158 et seq. 



9800 



-30" 



VII. irUNDU;EKTi\L FACTCHS AITZCTII'IG IJJLTIPLS CGD3 C,:VE2AGE 

At ti.e inception of codix'i cation t.'e :?olicy pursued wr.s tlir.t of 
C'ettiiitJ men oc.ciz to work fir?t aiid letting uejiy details t?i:e cr.re of 
tieuiSiSlvef. . T-iis van at tie, expense of f-andfiuental •plaaining. It 
can now oe seen t....at nany of tie later difficulties could "..lave been 
avoided '--.ad tiere been more pleainins. Tie question arises - if one 
or t. e cf.ier of tl\ese alternatives ;iad to be ne/^lected, wbicli sliould 
it kave been? 

ITeed for tl:.e establis^iment of a compre'iensive mdustrirl 
classification and a pro^'ram for fittin,; cedes into a predetermined 
"Jattern :f coverage was only discovered as tie result of difficulties 
created by tlie lac': of tliese tiings at tie start. Corrective raeasures 
■prevailed in eidiiiinistration, not preventive. Administration did not 
pull, it was puslied. 

T-ie divisional orsr,nin;ation of irilA was net tied to^etier for 
tie coordination of definitions determining industrial coveraj^e, nor 
for t e development of mutually consistent labor ^provisions affect- 
ing wages and working; perio'.s. Tkere y/as no rT:;.le to prevent in all 
cases independent action in c-ne division wkick mit^;llt vitally affect 
t>.e interests of industries allocated tn ane tier division. 

Vi'.ile tliere is sufficient evidence as t; tie f DJidrjnen tal 
factors affectini3 multiide code coverai^e te iiaJce it possible to avoid 
repetitien of many past problems, t.iere i s no prescription to be 
foimd for tieir complete cure. Tie nature of tke industrial r^tructure, 
particularly as to its econcmic ii.ipacts, its interconnecticn s, the 
ever-chaJieing demands upon it fjid t..ie ccipetitive responses thereto, 
prevents the writin^^' of aJiy permpment foiTaula. Multiple code c over- 
a^^-e wou.ld exist in some de£;ree, in ?.ny regulation of industry based 
on industrial classif icati: ns. 



9C08 



.', ■ CH..FTEH V 

CLASSIFYING 0£ iHEIVID-JAL MEMBERS OF F-TDUSTRIES 

; .'. ■ ' . -Alil T5AJES . 

Classification, as the term is used in this report, was the Tjro- 
cedure eiQ-oloyed in the settlement .of such administrative questions as 
arose from: .. : 

1 ... . Individual Uncertr?inty. ; 

.wHer.e. c.,n enter'orise .^-"s or claimer' to "be una.ble to deter- 
mine the code to '^i.ich it fos suDJect if any. 

2. 0-"-erla-D-oin^ Code Definitions of Industries and Trades ; 

(a) Vhere .two or more codified industries, construed their 

codes to include jurisdiction over the sane enter-orise. 

(t) There the o.^erations of an ent^mriso definitely came 

within the industry, def iriitions of tv.'o or more codes and 
i,t wp.s nccc3sa-ry. io. deter- in-e-whe.ther an enternrisc should 
"be required to ouerate under them. Cases under both (a) 
and (I)) vere also cases of multiple -code coverage. 

3. Uulti-ple Code Cu^^erage ; 

(a) T/There, because an entenorise manufactured, a diver- 
sity of TDroducts,,. it became necessary to determine 
the codes, e;-;riecially as to-,'^abor -orovisions, under - 
which they should be manufactured. 

(b) TFhere an enterprise was determined not to be su.bjpct 
to tli3 code of a jortain Indus cry on the ,f round that 
while it produced the rjroduct of that industry, the 
production of the iiroduct was not for the furoose of 
sale .as.sucn., but as a comDonent x)ji.rt in the construc- 
tion of s-'me finished unit of individual cxia.ract^r. . 

4 . The later -p o licy of absorbin.e: industry grou-ps or members into 
e-xiqtine codes r 

(a) Uhere small grouns a-oiiliod for their own code. 

(b) Where l^U. urged ijiodif ication of existing inr'ustry defini-- 
tioiis to nermit absor-otion of applicant groups in p.ref er- ■ 
ence to appi'oval of a ue"^ code. 

I. :::arly classification: 

The first code applications were handler by what was then known as 
the "Application Division" (later called the Control Section). This 
Section was char^^ed with the responsibility of receiving the applications 
from industry and starting them on their way through the mechanism of 

9808 



-32- 

codification. One of the preli-ninaries to recording an application for 
a code Tvas its assignment to one or another general grouri. For this 
TDurpose the Dan and Bradstreet Classification of Industry was adopted 
as being ready at hand. The index numherr. from this system were adopted 
for the NEA code aDT^lication recording. It rras not long, however, "be- 
fore aonlications began to he received from industries for which no 
aTJTDTopriate allocation ap-oeared in the Hun and Bradstreet classification. 
This made necessary the creation of suh-classif ications by interpolation. 

ContemDoraneously another development was being matured outside of 
NRA. by men with trade association erc-oerience; who had discovered through 
their contacts with NP-A. the difficulties which were being encountered by 
the apnlications of small industry groups and the xiroblera of their classi- 
fication. As an expodisnt to meet this difficultjr the device was ado^oted 
of bringing together under one basic code numerous related industries, 
each having a code of its own supplementary to the basic code and con- 
taining those rirovisions desired in addition to or different from those 
in the basic code. 

II. EFFECT OF DEFINITION-WRITING; 

The freedom allowed code applicants in formulating. industry de- 
finitions resulted in definitions with broad a.reas of overlap and led to 
innumerable controversies. This had the effect of throwing the already 
inadequate classification plan used by NRA. into still further confusion 
and led ultimately (though not until much later) to the recognition that 
in the classifying of enterprises as to their industry or trade lay one 
of the biggest problems with which NRA had to contend. 

To what extent the problem entered the administrative procedure will 
be seen from the fact that Code Record Division figures show that during 
the life of NIEA 776 codes (including suDDlementary and agricultural codes) 
were approved and tha.t aporoximately 5000 were apiDliod for. I'any of the 
latter were merged into existing codes, but every case contained the germ 
some form of classif ie-^tion question, arising generally out of the in- 
dustry definitions. 

Ill FOmiS OF IiroUSTRY DEFINITION-WRITING: 

In the absenee of a definite -oattern ef industrial classification 
there grew up at least four different apnroaches to what constituted a 
definition of industry: 

1. Definitions nredicated essentially unon the character of the 
business activity involved. 

For example, the "service trades" defined such sTsecific services 
as cleaning-and-dyeing and laundering. There was alsfl discussion as to 
whether or not the Job Galvanizing Tetal Coating Industry, the Blue Print 
and Photo Industi-y and a division of the Porcelain Enameling Industry should 
not pr^iDerly be considered as "service trades." 



9808 



The T'holesale or retail distribution of TDroducts was ra-'^de the 
basis for a separate division in the codification Dlfm, irres-oective of 
the products being ^vholesaled or re-Cr?iled. There are instances of re- 
cord in which the rrocuction and sale of a -Droduct, thou,£;h conducted by 
a single comx)any, was nevertheless required to be carried out under two 
separate codes, administered by different industrj'- divisions of NPA. 

2. Definitions takAnr- their character from the nature of the 
■purchaser's business. 

An exaranle of this is the basic code of the Automotive Parts 
and Equi-cment Fanufacrnrixig Industry and its numerous surmlements such 
as Automotive Shop "E:::'ii-)menb Ilanuf acturirg, Carburetor I'anufacturing, 
Gasket Manufr«cturing, etc. 

3. Definitions based UBOn the actual products manufactured. . 

4. Industries having sufficient interests in common to warrant 
their being broarht together under a basic code, for vhich a collective 
title (not thst of a single industry) was selected. 

As examples of this there may be cited the Fabric ted Fetal 
Products Manufacbur:" ng and iiatal Finishing and l"'etal Coating Industry 
and the Machinery and Allied Products Industry„ 

Obvicnsl;'-, codes of the last type were not lout together ac- 
cording to any ulan ci "classification" as the term is used herein. 
Consequently, taey were among the nrolific sources of problems involving 
the- classifying of indystri;:?r.. The following codes of this type presented 
the most serious problems. (,'*) 

■ Automitive Parts and "Squipment Manufacturing 
Constructiin 

Eleccj.'ical i'r.uuf acturing 
Lumber and T'iabcr Products 
iabricc.ted T'.ebal P/.'oducts and Supple-.ents 
I achi'-'/rry ai;d Al" led Products and Supglemerlts 
■Bitu" irious P.oad J'^a. serial s Distributing 
P.ubber Manufacturing 
Cotton Garment 
Graphic Arts 
Infants aiid Children's ^ear 

(*) See also Apuendlx Fo. 6, a list of codes seemingly involving 
jurisdictional conflicts. This list was prepared subsequent 
■..to Mny 27, 1935, by or ^onder the su-oervision of C. A. BishoTD, 
of the -ilPA, 



9808 



-34- 

IV. SETTLEMENT OF CLASSIEICATinN CASES: 

Under IIEA procedure loroblems involving:: the classifying of individual 
members of industries and trades did not necessarily reach the NRA ex- 
ecutives best qualified to settle them. Erora ^rhat has been stated in 
Chg,pter II, .it will be seen that a unit for the handling of classificar' ■. 
tion problems T^ithin NEA did not come into being until the 9th of Atjril, 
1934 (*). , 

Frequently in considering questions of classification the deputy 
administrators called in their advisers and also secured the recommenda- 
tions of the code authorities of the interested industries. On occasion 
reports from the field offices were secured. Particularly involved cases 
required hearings before settlement. The adjustment consisted generally 
of:' 

1. An explanation, advising an enterprise as to the code 
or codes it should observe, or 

2. An official interpretation of the definition of 
the code or codes, or 

3. An order of exemption from certain provisions 
of a code or codes, 

Cases are on record in vhich the industry refused to accer)t the 
classification ruling of I:IHA Find upon protest wa,s successful in getting 
as many as three reversals of ruling from NBA on the same point. 

In the case of Ho"oe '?Jebbing Company, Inc., Providence, R. I. (**) 
a controverBy dealing \Tith the industry classification of a "oarticular 
woven and braided fabric, insulated tubing, the first ruling required 
the Com-oa.ny to go under multiple code coverage involving seven codes. 
A second ruling some three months later classified this product under the 
Electrical Manufacturing Industry. This wa.s challenged by the Com-oany, 
without result, and it was found in violation and its Blue Eagle rights 
were withdrawn. It thereafter secured a re-consideration, under which 
NUA withdrew the order of violation and restored the Blue Eagle rights. 

The whole -procedure occupied between six and seven months. 

(*) Office Order No. 83. The Coordination Committee, a sub-committee 
of the NTIA Policy Board, (Office Order ¥.o 58) did not actually 
function on classification problems although, they were so auth- 
orized (according to verbal information given the author by Geo, 
S. Brady, Oct. 8, 1935). In sup-oort of this statement is the 
fact that no order or ruling by the Coordination Committee on 
Classification matter has been found. 

(**) MA files of the Assistant Administrative Officer.- 
Case llo. 262 



9808 



-35- 

The classification files, ato^'e referred to, will te found to 
contain records of many other individual cases. TThile differing in 
details, they all have their administrative aspects in one or the other 
of the categories with vhich this chapter is introduced. 

V. COIDITIOI'S AFl'-ECTIKG FROBL^^iS OF CL.\SSI±ICATION : 

There was no coordinated plan for the rriting of codes for all 
industries. No TDOlicy was established to guide industries in the draft- 
ing of their definitions. On the contrary, the Administration policy 
declared by Eul''etin re. 2 of June 19, 1933, "Basic Codes of Fair Cora- 
petition", was such as to make the definition of each industry as sub- 
mitted to KEA exclusive by the product of the thinking of that industry, 
regardless of its relation to the national industrial network. 

Ilorever, undertaking to secure the codification of industries at 
high pressure, consideration important to pei^nanent adiinistration were 
neglected, with serious effect upon Industry-NFA. relationships and the 
successful carrying out of the principles upon which KIRA was founded. 

However, the problem of classifying members of industries and tra(?es 
will exist under any industrial regulation predicated upon the ririnciples 
of the NIRA. 

The foundation of any system of classification should be a compre- 
hensive and well-ordered national industrial classification, UDon which 
to establish a sub-divisional industry pattern sufficiently adjustable 
to minimize possible inter-ind.ustry interference. 



9808 



-36- 

CHAPTER -VI 

HECAPITU L A.TIO IT. 

Becavise the three subjects of this re2T0rt have nany of their 
prohlens so clos^ely related, it is difficult to separate then uhen suti- 
marizing and evaluating their administration. 

It appears, first, that adninistration clearly had the choice of 
t'TO arrays of luttiuf' the national Industrial •Recoverj^ Act into effect: 

1. To rej2;ard the Act as purely an energency measure 
designed solely to put nen "bac'.: to vrork Jis. rapidly 
as possihle, ■under ua.fi;es and hours provisions rhich 
TTOuld aid eaplojnnent and stimulate jj'^i'chasing 
pO'.Ter. 

2. To regard the Act as the means of effecting a per- 
manent change in the industrial system, londer rrhich 
vrould "be a controlled conipetition and a new, federally- 
guided self-resgulation of industrj'- nith the evils of 
the old system rrould he tei^'iina-ted. 

These alternatives have many characteristics which are opposed. 
The objective of putting men bad: to roi'h as rapidly as inossible as a 
part of emergency pl,a}ining, could not be achieved if the tine were to 
be tal;en to carefully, systematically and -lethodically plan the multitude 
of details tha,t must precede the putting of such an act as II.I.R.A. 
into practice for permanence. There were no precedents, no erq^erience, 
to draw upon, hanj- of the factors bearing vitally ui^on the proba,bili- 
ties of sv.ccess were un'morai. 

ileverthelesG, the consequences of starting the whole project as it 
was started were not altogether overlooked. There --rere many xiho visua- 
lized, at least in part, the manifold comnlications and ramifications 
which 'fould attend. But their voices were small '.•'hen pitted against 
the enthusiasm of the attach. 

Putting men bad: to work under improved wage and hoxir 2:3^ovisions 
beceie the objective of early administration. To this end all else was 
made secondary. The industries having the greatest number of men were 
assembled for codification first, regardless of where they or others 
fitted into the whole net-'ork of national industiy. This report does 
not presvj.ie to say whether this was good adi:inistrative judgment, It 
does, however, pose the question. It attempts also to point out some 
of the fui^danental thini:ing that fro:: the purely administrative point 
of view vras conspicuous by its absence. 

The great need of the first days v/as for an inoaistrial pattern or 
master classification of all industi^y by "hich the definitions of in- 
dustries in the codes could have been coordinated. To produce such an 
industrial classification would have tal:en ti.-.e, but it would have saved 
a large proportion of the later complications. The classification need 
not have been perfect to have served this purpose. To this day there 

9808 



is no sr.cli clp.ssification in existence, plthouch n, great deed of 
valuable v-oi-]: has bean done in thic- direction. 

To be stire, there --ere other cai.ises of the -oroblens herein dis- 
cussed. One of then '/as the II. R. A. -oolicy of inviting all industries 
to initiate their om inJoistry definitions. This each industry' did, 
often vrithout reti'ard for the ri^'^hts of any other indvistry. 

Laching a riaster cln-ssif ication, or the tiie to create one, it 
still regained possible for the ad::i inlet rat ion to put into effect 
some nachinery for coordination, by which code definitions of industry 
could have been checked against one another and cleared of grave over- 
laps, whether or not tlie codes fitted into a consistent ^jhole. 

A gooc. nan;^ enterprises had to "ork ujider conditions of multiple 
code coverage becarase code definitions of their industries overlapped. 
Here the problen grew out of the claln that the products of m enter- 
prise had to be I'.ade under the provision'? of the codes which showed 
coverage 03 definition. 

Another tj-^e of nultiple code coverage 't.s that where pji enter- 
prise found, itself ujider t'-o r,r norc codes in the nairufactxire of its 
sever-J. prod.ucts even though no overlap of the codes wa,s involved. 
Here again solution of the problens this sitiiation presented woxild 
have been sinplified had there been a naster industrial classification 
pattera to bring about consistent conclusions' or if there had been'leg'g" 
complexity in the labor provisions of codes. 

At the root of the orobleM of ;uiltiple code coverage lay the inpos- 
sibility of requiring dji enterprise to I'.ecn itself within the confines 
of one ind"Listry or trac..e as d.efined ^o:/ a, co&.e. Fron the industiy stand- 
point it was a cuntintiing problen, pjad in sone respects, an unsolvable 
one. However, the worst of the problen would have disappeared had some 
v:ay been fnuiid to equalize the cost of production in conpeting indus- 
tries. Tlie equalizing of cost involved prinarily the equa.li?ing of 
wage cuid hour provisions in the coci.es involvecl. ruis was recognized, 
and acconplishedi to s. United e::ter.t. The general a,p;ilication of the 
plan was however beset by nany difficulties, which vrere still in the 
way on Ivia;' 27, 19 £5. 

The usual proced.ure of h.R.A. as to the subjects here discussed 
was corrective, not preventive. Adiiinistration was pushed-, it did not 
pxill. It -.'.ej be said, lyith ;iuch tiTith, that this was CJi inevitable 
consequence of the unprecedented nature of the l.'.H.A. effort and. of the 
impossibility- of prophesying ind.ustrial reactions and their couplica- 
tions. This, however, would not a'opear to justify the failure of 
executive au-thority to set up a plan to correlate ad:-iinistra'..ive e:c- 
periences raid, engage itself energetically in getting ahead of the 
troubles before they becai.ie overpo'..-ering. 



3808 



■■■ -38- 

In conclusion, three thini?s stand out as the result of this stud;;'-. 
T'-TO of then v-ere basic deficiencies: 

(a) There vfs no conprohcnsive plan of classification 
of induFtries rjid trades upon '-hicii to foujid a 
/general adninistrative polic;- and coordinate the 
loroceduro for indu^tr;"/ codifi caption. 

(b) There iras no authoi^itative \mit vithin IT.H.A. r/hose 
sole -oari-Dose it vrxa to correlate administrative 
experiences and eii{;rge itself ener/;:ctically in the 
advgjice planninri of the ^irocedure, to keep the 
organization aiiead of its prohlems. 

Tlie third is that there could have been no permanent cure for all 
classification problems or for all the pi'-oblenis arising froii overlapping 
code definitions or multiple code coverage as long as enten^rises re- 
nained free to choose pjid chan;;'e their O't. lines of Manufacture and 
fields of distribution. 



9808 



■'-39- 



APFENDI CES 



9808 



-4:0- 

Appendix No . 1 
METHODOLOGY 

This report is a study of N.R.A. adrcinistration as applied solely 
to Overlapping Code Definitions of Industries and Trades, Multiple Code 
Coverage and the Classifying of Individual Members of Industries and 
Trades. 

Almost the only written record of the evolution of administrative 
thinking is in the N.R.A. Administrative Orders, Qffice Orders and Office 
Memoranda issued from time to time, and occasional Eyecutive Orders. 

The effort has been to trace administrative development by these 
means and in the light of the progress indicated to reason deductively 
as to the sufficiency of the administration of the Recovery Act and the 
logical consequences of the methods used. 

To aid in the interpretation of the Orders and Memoranda, infor- 
mation has been gathered from many material sources, especially: 

1. N. R. A. Bulletins 

2. Issues of "The Blue Eagle" published by N.R.A. 

3. NRA general files 

4. Transcripts of Public Hearings in NRA files 

5. Reports on various subjects, NRA files 

In addition, numerous persons vho were actively connected with ad- 
ministrative phases of NRA were interviewed. 

FURTHER RESEARCH 

The following list is provided as a means of guiding the future 
student who may wish to follow the subject of this study beyond the range 
of the opportunity open to tne author. 

1. Histories of N.R.A. codes, written by the organization since 
May 27, 1935, especially the histories of those industries 
listed in Appendix No. 6 with numerous jurisdictional conflicts 
indicated. 

2. Final Report, Automotive Codes and Related Codes, June 26, 1935, 
K. J. Ammerman, N.R.A. Files. 

3. Copy of the NRA Office Manual, NRA files. 

4. Files of the former Assistant Administrative Officer, Mr. George 
S. Brady. 

5. Report on Codification of the Distributing Trades under the 
National Recovery Act, Harry C. Carr and associates, August 30, 
1935; Forts I and II, NRA. Files, 



9808 



-41'* 

6. Transcript of Hearing on Conflict and Overlaps, Furniture 
Manufacturing Industry and Hardwood Dimension Division of 
Lumber and Timber Frod\icts Industry, May 21, 1935, NRA Files, 

7. Classification Files, Insignia Section, Relative to labor 
provisions posters and Code Sagle insignia, NRA Files, 

8. Files of the Construction Industry Codes, rlRA Files. 



9808 



"42- 

Vrii-t (A) 

PROPOSAL 

mCrP-Oupirc} OF co3i.s 

June 22, 1934 

A rcclps-ifics.tion iu ncded at once in conformity^, wi©i .i;he actual 
operation of incastry, takinj; account not only of similarity of fu:iction 
but also of ~eo,^;rfphic distribution, and of factors w^iich \vill have a 
bearing on efficient af/-ininistration. The tine has no'-v come when we have 
seen s:.flicient code definitions written and arc sure of our steps in 
reclassif ica,tion. As presently orTf-nized, wc are in mrny instances far 
from s. lojical groudnj ond classification. 

In the te;;tile ineustry, for e::Gmrile, there are eifjht separate 
coees for different kin'..3 of buttons. Wearing; apparel and accessories, 
now in 56 n6pa.rate codes in three divisions of I'J.R.A. , rsaould be under 
one dcpv.ty for eventual araaljaniation. In the jjaper industry there are 
eight separate codes for variou.s kinc's of paper contair.ers and boxes. 
There a.rc ucre than 60 retail codes, and the _jresent drift of the trade 
is tov;arc setting up multitudinous siib-code authorities in trade regions, 
thus disturbing anc^' conj.usj.ng business men. A geogrcphic alignment of 
the v-'holesale anc. retail trades and consolidation of a'-rainistrative 
functions "Till cu.re this. There are nur:iereus service industries with 
separate codes, necessitating se-narate local sud> rvisory bodies, when 
one supervisory oody in a given coinr.iuni ty v/ould be sufficient to ad- 
minister all of thciq* Tiiese are merely sai.iplesof conditions to be 
correctec, 

Throu.,h araalgai.mtion and regrouping of codes in accoro.ance with 
a logical c].a-sr:ifi cation , and through cooresoono.ing changes in the 
orgrnization of the IT. H. A. , v,v vdll be hlolt to attain a vnaximv.m of 
efficienc:; in acininistrfj.tion with a ninimuni of auiiinistrative machinery 
and cfiort and a minimum of i..terf ei t ncc ".;ith in(..ustries. Thus we maj'' 
provio.e the nicrns whereby an organized, combined effort of industries 
and of the IT.H.A. , :>n the basis of e:.perience gained to date, will 
create a sy-;ten of coordination whic]. will be strong and coherent 
enough to perform its functions with promptitude and certainty, and at 
tht- same time flexible enough to meet all contingencies. The reorgajiiza- 
tion i.TL-.:;t b.. based upon and follow the logical classification of 
incusurit^s and traces. 

The sug 'ested layot\t proposes to place all industry, trade and 
commerce ivi 22 major classifications for eventual vertical coordination 
of these groupings. It is superior tc the census classification, but 
will not interfere with it. It ^ oes not propose "regimentation" but 
rather a natural, orderly arrangement tl;at will be welcomed by industry 
as a simplification. This arrangement '-.'ill also facilitate labor con- 
trol. J-t is proposed to align all codes in a io ;ical manner according 
to ma.jor indv.stries, consolidatin ; u.cm f-s far as possible imr.iediatcly 

9808 



-43- . 

v/ith banic cotes of similar nature. Pollovi'in^ such ali~nraent of code 
groups imucr one deptity anc. one t.ivision ac.rainistr£.tor , those small 
incustries which refuse, at the jresent time to ;;o ur.cler brsic codes 
will soon see the rursonaolencss r-.s v.ell as the naany advantages of 
the set-up, and it is certrin that they will be v/illin-?; eventually to 
align themselves v;ith basic codes. 

The nx^ber of codes aipprovca to Jione 20 is 467. In addition, 
10 codes have been s^^bmitted for si,'-:nature, raahin.r; e total, of 477. 
Another 137 coCes have passei.. public hcarin^", ani. a list is attached 
showing the status of tliese and indicating tliat within the next month a 
large jercentage, of these codes v.ill na.ve beon finally completed. In 
most cases the reason for holuup has been eh arjiTOL.nt ovc;r labor or 
trade practice provisions, ana in most cases fiiese disagreements can be 
settled by aj_:ressive action on the part of the deputy. 

This leaves 152 codes of all kinds to be handed, to complete 
code maicin;;. The em jloyees involved in these 152 codes total approximately 
2,000,000. Every one of these codes belongs lo ;ically with some group 
such as v.'e have set up in our ma-ster charts, either under a basic code 
or as a separate code coordinated v/ith a similar industry and located 
for acministration under the ■. epv.ty handling similar industries. The 
speecy transfer of these codes to ';;roupings under v/hich they belong 
will hasten the ;)roceso of amalgajnation v/ith other codes. In most 
cases the basic codes need not be changed iii definiation to include 
these small industrit s. 

Dxirin'-; the past six weeks, a number of ^transfers of codes has 
been made for amalgaraation purposes and for easier acir.iinistration 
unaer depi^ties handling similar codes, but the process is unnecessarily 
slow and cumbersome. This trial pei'ioo. has shown that classificr-tion 
is not a matter of routine policy, but is a matter of the more important 
and pressing jiroblem of general orgrnization. Also, the time has now 
come v/hen personnel v.-ill have to be shiftt-d along with groups of codes, 
in order to create the lenst disturbance within the orgrnization and in 
our relations with industries. It is believed that such reorganization 
as is necessary cr-n. be effected quickly and without any particular dis- 
turbances, if it c-n bo handled in an axuninistrrtive v/ay by persons 
specifically desi;,nated to do the job. Additio3ial divisions within 
N.R.A. should be set up as soon as possible to hanlMe Textile, Chemicals 
and Basic hatcrinls. 

The procedure for action is as follows: 

1. The jresent line-up of groups of codes is as follows: 

Division 1. Basic Materials , Utilities, Automobiles, Ruboer, Shipping, 

Division 2. llachincry, Lvjnbor. 

Division 5. Ciiemicals, Construction, .Leather, • . 

Division 4, Distributing Trades, Textile Fabrics, 

Division 5. Aip.uscmonts, Ac'vertising, Servioj?— iilsadus.,, Tj^.aasportation, 
Wearing Auparel. 

Division 6. Foodstiiffs, Farm Products, ,. 

Division 7. firpphic Arts_, Publishing ■• 

Division 8, Territories/' Manufacturing Co-mpact, 

9808 



-44- 

2, By c.etril transfers build wp rroiipings of codes n.ndcr deputies 
in ac. ordance v/ith the I.iaster Chart. These- transfers to .^e ordi^red by 
the Coiimittcc after liearing Division ano. Deputy Acaninistrators concerned, 
and to he carried oxit hy ai'ran^?:om(|nt between th(_m as recjuested by cir- 
curast.-nce, due rcgrrd bcin^' riven to status of cocie conplction and adaninis- 
trstion. 

The order of moves of codes v^ill be as fellows: 

All Foodstuffs cod.es into Division 6. 

All Forcstrl codLCs into Division 2, 

All Te;:tile Fabrics ;dnnufa,ctv-ring codes into Division 4. 

All Wearing Apparel codes into Division 5. 

All Leather and Fur Cod.es into Division 5. 

All Itubbor codes into Division 1. 

All Chenvicc-lb, Paints, and Urxv; coces into Division 3. 

All Taper codes into Division 3. 

All F-o-el codes into Division 1. 

All Ferrous codes into Division 1. 

All Kon-Fcrrcus cotes into Division 1. 

All iTon-i,;etallic coc.es into -^^ivisinn 1. 

All Equipment codes (inclue.in;;; Automobile, Shipbuilding and 

Airdrait ivionufacturing, ) into -^iviiion 2. 
All Polysraphlc cod.es inta Division 7. 
All Personal 1-^sC Proeuctrj. codts into Division 7. 
All Construction codes into Division 3. 
All Public Utilities coo.es into Division 1. 
All Transportation codes. into Division 5. 
All Coi.siuiii cation codes into -division 1. 
All Aiausenent cod.es into Division 5. 
All Finance and Coi.imerce codes into Division 1. 
All Professions and Service codes into Division 5, 
All Distributin,^ Trades codes into Division 4, 

This laeans chat a lar^^e nLoaber of luoves of individual codes and 
groups of CO'' es will be laade at once, in some cases, as in automotive 
and. s"nipeu.ildinj, the deputies moving with the codes. But each move 
will be v;cll arranged in advance of the ord.er of uove so as to raehe 
no comraotion in the H.E.A. ori'^-anization or disturbance to the indust- 
ries, V/ith full knowledge and facts on'both sides, the move order 
can be :3repared.' and sent through the Adininistra.tive Office according 
to existing methods for transfer of codes, except tha.t sepa.rate 
personnel transfer orders can be arranged at the seme time when it is 
desirable to more personnel with the co'.es, 

3, T/hcn these transfers l.ave be en -made and the realignment of 
sii.iilai' grou.'s of codes under depi-.ties is complete, possibly in 60 
days, the groupings of codas will be as follows: 

Division 1, Finan ce and Go:.j:ierce, Public Utilities,' Fuel, Basic 

I n il ^"^^^ ? ■ . ' J " ■ 

i-'8,terials, Cominuni cation, Rubber, 
Division 2, Squi jment . Lumber. 
Division 3. Const ruction, Chemicals, Paper, 
Division 4, Distrib-atin-^ Trade_s_,_ Textile Faorics, 

8808 



..-45- ' 

Division Z» A'ln.scment'^ . Professions , Wearii')-; A ipa.rcl, 

Liafj.er 'pn(. Fvx , Trj;'ns;^)Qrtation. 
Division 6, ?ood:;t^iiTs . 

Division 7. Ppl /A Tra-ijl ic, Perrional Use Products. 
Diviaioii S. Lirn'Ltfr. cti.rir.j, Com^.scts, Territories. 

4. Issue an orccr establishing thrt ; new divisions: 

Division S, Basic lusterials. 
Division 10, Chemicals. 
Division 11, Textiles. 

i,Ial:e the followin.3' moves of entire gror.pxnjs of codes, with 
correupdndinj pcrso'nnel adaainist^rin'^ them as follov.'s: 

a. All Putlic Utilities C-rou) from D 

" Coi ;i.iunications " " 

" Tran'syjortation " " 

b. All Fuxl " " 

" 35 sic iuatc rials " " 

" L^.iraber. " -. " 

c. All H"bbcr , " " 

" Chemicals " " 

II p. ■,,£!. II 11 



(.. All Textile ?abric>: 



II II 



II 7' -.r,V-i ,-.r- A-,-. ,CY-, 1 " II 



7 car in;;: Ap )arcl 



sion 


1 


to 


-ivision 


B. 


n 


1 


II 


II 


8. 


11 


5 


II 


II 


8. 


II 


1 


II 


II 


o 


II 


1 


II 


II 


9. 


11. 


2 


II 


II 


9. 


II 


1 


II 


II 


IC. 


II 


3 


II 


II 


10. 


It 


3 


II 


II 


19*. 


u 


^ . 


II 


II 


11. 


II 


5 


M 


II 


11. 


It 


5 


M 


II 


11. 


II 


O 


It 


II 


11. 



" Leather and Pur " " 

" i.Irnufreti.rin;^, Coimiacts " 

* * 

e, AdminiEtration of Territories" " 8 " jurisdiction 

of Ficlc Adair.istrator. 

J. U--/on con.pletion of £-11 the above transfers, the divisions 
shoiilL. iiavc^-iatcly be renemberd in order that -the arrangement of 
industries v/ill r"'". Trozcimr. te the Bureau of Stana^rds and the International 
Clas'.rlfications, The changes in niimbcrinf; will be as follo\7s: 

"Division 1 to be chpn-^ed to' Division IX 

II 2 " " " 

II 3 n II M 

II /. II II II 



2 


II 


3 


n 


/-. 


II 


5 


II 





II 


7 


II 



II 5 II II It 

II 3 II II II 

II 7 II n II 

" 8 v,'ill retain its n-umber 

" j3 to be chan.;jec to Division III 

11 10 II II II II IV 

II 11 II II II. II II 





V 




VII 




XI 




X 




I 




VI 


r 


VIII 



9808 



-46« 



6» Tlie final ,':roupin-:r pvin-?; bten accoinplishcc , st this sta^^e 
four Assistant Administrators could be appointee, to handle logically 
arranged ^rou^jirir's of Division in order to fa,cilitate administration. 
Division Au.riiiistrators v'oulf. then contact the Acaninistrator through 
the Assistant Adirainistrators raio v/o-dd have chari:^e of the Division 
Group as follov/s: 



Assistajit Acmi: istrator 
for Piodi.cin'' Inoustrics 



Assistant A(--ministra.tor 
f-or Squipment Industries 



Assistant Aomiiiistrator 
for Service Incustries 



Assistant Acjiiinistrator 
for Distributing Trades 



Div, I. 



Div, II. 



Div. III. 



-iv. IV. 



Div. V. 



Div. VI. 



Div. VII. 



Div. VIII. 



Wv.. 



Div. 



IX. 
X. 



Div. XI. 



FOOD li'DUSTRY: 
Fooc'lS, Feeds, and. 
Farm Products 

TLXTILi; ILIDUSTSY: 
Textiles; l/earing Apoarcl, 
Leather, Fur, Lianufactiiring 
Compacts 

BASIC .iATLKIALS: 
Forestal ProG.ucts, Fuel, 
Ferrous Iietals, Kon-Ferrotis 
i.ietals, Kon-I.ietallic Liinerals 

CliLiICALS: 
Chemicals, Paints, Drugs, 



Pai). 



Euhber. 



I'Al^nJl'ACTUFJHG: 

Production Equipment, 

Service j^quipment 
A..TS c; CHAFTS GOODS: 

Polyi~;rsphic Industries 

Personal Use Goods 
COrSTEUCTIOlI: 

Construction Indxistry 

FT;LIC UTILITIES: 
Public Utilities, Transpor- 
tation, Communications 

FIIIAKCL L COi.iiiKCE: 
Finance, Corm-nerce 

pr.OFEssiors Airo services: 

Ainusements, Professions, 
Services 

DI STRIBUT i: " G TiUDES : 
Wliolesale Traues, 
Retail Trades 



9B08 






-47- 



ji.PPiiNDIX FO. 2 
Fart (B) 

A 

fi i. V I i!. I; 

oJ: the 

CLASSIFICATIlN PKOBLm SITUATION 

vith 

EECOmMLKDAT I OKS i^SP£CT Il'G 

the future 

COl'TP-OL Al'D HANDLING OP THESE FPOBLMS 



I. Causes Contributing to rislocations, 

1. In a l?r;-:e mepaure, the Classification Froolems appear, 
in the ahstirct, to arise as a consequence of: 

(a) the heterofjeneous characteristics of American 
enter-prise, in fi;eneral; w.ith the diversity of 
pi'Oducts or serviceo and the various methods 
of production and/or distribution employed 
iTithin the same industry/trade by its comronent 
elements; and/ or 

(3) the fixed limitations of Title I of the Act, 
establishing "true representation" as a 
measure of qualification for the proponent 
group and conseouently limiting the boundaries 
of the industr'f /trade it iostered, cou-:'led 
witn the absence on trie part of rre-code 
industry/trade of a systematic a;aalgamation or 
coordinrtion of collateral units, (i?^itness the 
assembly ot the units in the Trade Association 
groups); Doth of rhich conditions tended to 
op-t^ose a codiiication oi a. houogeneous industry; 
and /or 

(C) the .non-codification of certain industries/trades 
or sub-divisions, thereof, creating "gpps" of un- 
codified groups. 

• 2. The imnediate causes appear to involve: 

(a) the experimental nature of the program, accompanied 
by the absence of anN^ concrete theory anc/or 
definite plan for the codiiication of industry/trade 
and an apparent decision not to establish a cohesion 
in codification by coupling an interpretation of 
the Act respecting the e>.tent and/or limitations of 
"an industrv/trade or a sub-division thereof" with an 
interpretation of the scope of "true representation", 

9808 



-48- 



resultinio: in the disarrpngernent pnd sepprption 
of actupl industries and trades;' pnd/or 

(B) the submission ov tne proponents and acceptance 
by the Administrption oi rigidities and/or 
Qualifying limitations (frecuently ambiguous 

or indefinite) in the definitions determining 
the extent of r proposed Coae; anc/or 

(C) the pDCPrent non-recognition of the ele.nents 
disting-aishing an actual or potential 
Clpssif ication Problem oy some of those 
charged rith the resiDonsibility of ceveloning, 
administering and promoting coupliance and 
enforcement ol codes and the resultant opinions 
released; and/or 

(r) the ap-Dprent failure to properly understand 
ahd/or aprly the existing loolicy of the 
Administration respecting Classification 
Problems; and/or 

(e) the apparent absence of coordination betveen 

the various units of the Administration in the 
development of the later codes and in the 
promulgation and issuance. oi Orders, Eulings 
or other foncs of Releases in respect to 
CIf ssif ication Problems. 

■^^* Types an d Nomenclature of Qrcers. Itu l ings and releases : 

1. Existing Procedure relative to Classification Problems 

comprehends several forms of Orders, Rulings or Eeleases, 
'i^hich inpy be issued, depending on the characteristics of 
and the field affected by the actual or potential dis- 
location, to '-'it: 

(a) Executive Order (Executive Order Serial No.): 

(B) N..E.A., Order (Code Serial No.): 

(a) Order of Approval for a Code of Fair 
Competition. (Note: The approval of a 

, code may set \ip a field of dislocption. ) 

(b) Order of Approval for an Amendment to 

p Code of Fair Competition. (Note: The 
ppproval of an pmenced definition of an 
industrv/trpde may set up a field of 
dislocption. ) 

(c) Order of Approval for a Supplement or an 
Appendix to a Code of iair Competition. 

9806 



i 



- "O 



(C) F.E.A. Order (Ac:nini;^tr8tiver Order "k" Series): 

(a"* G-enerpl Interpretation: (See Acininistr?- 
tive Order X-IS?) 

(b) C-enerpl Exeiai-tion; (See Adiainistrptive 
Order X-7i ) 

(c) frenerfl - Stpy: (See Administrative Order 
X-&) 

(d) Oeneral Classification : (See Administrative 
Order X-3o) 

(p) F.E. A. Aomipistrative Order (Code ¥o. Series): 

(a) Specific Interpretation (Orcirary) 

(b) S pecifi c jLi^eraption 

(c) Specifi c Stay 

(d) Sp ecific Classii ication 

(e) Informal i.elease (Code Ho. Series) 

(a) Specific emergency Stay 

(b) r7enerrl Lxplr nation 

(c) Specific Expl -'nation 

2, It is to be noted that ==11 Orders of the foregoing 
forms do nO', necessarily comprehend Classification 
Problems, as such. Jrequ.ently. an Interpretation, 
Exempt:. oa or Stay Order is prescribed 'j-^here no 
Classification Problem exists. Ho"'ever, a Classi- 
fication Problem may also be an antecedent problem 
to some other situation. 

3, It is also to be noted that certain types of Orders 
are termed "Ordinary" in the Office, Manual. In order 
to distin£,-uisli bet'"een an Order vi'hich is nore or less 
"General" from one that is "specific", a separation 
has been made in the foregoing groupings and refer- 
ences, f ollo'"ing, '-il'' be made accordingly^ 

III. Povrers, duties and responsibilit ies of IJ.R.A. Bo ards . 

Divisions a iic ExecuLJves rno Sp ecial A>'?encies i n Respect 
to Classification Problems . 

1. Certain po'-ers, duties and responsibilities of N.K.A. 
Boards, Divisions, Special Agencies and Executives 
relative to the consideration and handling of the 

9808 



-50- 



problem pnc" the. proirial.Tptiori of Orders^, nulir-^s and 
other for:ns of Iielepses are set forth in Office Orders, 
Office 'emorpnda,- and Procedures (in this repard it is 
to be noted that except in those crses v^'here specific 
■po-'er ?nd authority hps been conferred oy specific 
order, authority apTDe-rrs to be conferi'ed - "qui fpcit 
per alium f^cit per se" (vhoever acts through others 
acts himself). These Orders and procedures treat 
Classification Problems under tvo. (2) major hepdings, 
i.e. under Classification Problems, as such, and under ., jf 
Amendments, Interpretations, ExemiDtions and Strys and " •"■'", 
reference to such have been noted accoraingly in 
Apcendix ''A", attached hereto. However, as has been 
noted previously, the approval of a Code or the approval 
of an ArnendTient to an existing code may also constitute 
the source of a Classification Problem, and, accordingly, 
in addition to the references, noted in the Appendix "A" 
attention is invited to those sections of the Office 
Manual relating to Code iiaking anc Aiaendment (Pars, II-l, 
000 to 5,999 incl.) 

2. Ithile existing procedure does not provide a complete 
centralized control pnd co-ordinp,tion for the con- 
sideration and development of all Classification 
Problems nor for the determination and , issuance of 
Orders, .Rulings and other Forms of heleases, in 
respect thereto, it does provide for the treatment 
of certain of such problems, sub-dividing the treat- 
ment into three (3) ;;iajor groupings, to vit: 

(a) A. problem involving one or more approved 
codes v'ithin the jurisdiction of the Deputy 
Administrator handling the codes involved. 

(b) A problem involving more than one 
approved code, vithin the jurisdiction 

. ot more than one Deputy Adininistrator 
handling the codes, but vithin the spme 
Division. 

(c) A Droblem involving more than one approved 
code, within the jurisdiction of more then 
one Division, or an actually or potentially 
uncodified 'group or element of a trade or 
incustry, 

and sets forth the jurisdiction of the follovdng Boards, 
ofiicials and agencies, to -^^it: 

(a) The National Industrial Recovery Board 

(b) The Administrative Oflicer 



9b0& 



--51- 



•^ (c) The Assistant Aomini&trative Officer 
(for Classifications) 

(d) The Division Administrator. 

(e) Tne Deputy Acitiinistrator 

(f) The Assistant Deputy Administrator 

(/^) The Director of Compliance and Enforcement 
Code Advice Comiiittee 
Government Contracts Branch 

(•h) The Advisory Council 

(Note 1: The foregoing does not list the several Advisory 
Boards and Division (inclucinf< tne ileview Division and the 
Review Officer rhich function is an advisory and reviev' 
capacity). 

3. The treatment of all Classification Proolems, however, 
does not proceed through the channels as heretofore 
mentioned, -Frecuently problf,ms are submitted to (l) 
the Code Advice Coiraittee which may recommend the 
issuance of an Order, or (S) the Advisory Council 
which in tu-rn may make recommendations to the National 
Industrirl t^covery Board and throusrh the Administra- 
tive Officer i^sue an Order or (3) The Government Con- 
tracts 'branch of the Compliance Division which may 
recommend the issuance of an Order. Further it is 
possible that a problem may be submitted to the N.E.A. 
Appeals ?oard for its recommendation. It is too early 
to predict how the Service Trades Cooe Comiittee or the 
Committee for the Ctudy of Distribution Differentials may 
function in respect to any Classification Problem. 

4, The recoi-;nition of the problem and the nature and receipt 
of the' initial inquiry has- a bearing on th« procedure 
that may be followed, problems lapy be initiated by or 

be the consequence of a nujnoer of circumstances. A 
specific '"ritten intjuiry mav be received and if it ap- 
pears in the opinion of the ex?n:iner to apply to a. 
certain approved code only, it -will undoubtedly be routed 
to the Assistant Deputy Administrator in charge. A 
specific inquiry may also be oral, by telephone to or 
personal contact with an individual. Again the problem 
may present itself as a consequence cf some Hearing or 
conference,, foreign in the first instance to the problem, 
Frequently, Bulletins, Circular Letters, Minutes of 
Meetings or other Releases issued oy Code Authorities with 
or without the approval of the Administrator are the 
sources of Classification Problems, Again the existence 



9808 



f 



*-52"» 



of a potential Classliicstion Problem May hot be recog- 
nized at all EO that the ppplication and value of existing 
procedure may vary to the extent that the existence of a 
problem is recognised; to the degree that the Deputy 
Administrator (and/or the Administration Member) jealous- 
ly .<^uards the uroper administration (in his opinion) of 
the coces rithin his jurisdiction as against the co- 
ordination of the v'hole scheme; and to the extent that 
control of the vhole is decentralized. Accordingly, it 
v'oald ap"Dear that there may be as mrn^ methods of treac- 
ing the problem as ^--e have Deputy Administrators, Assist- 
ant Deputy Administrators, and Aides, The types of ques- 
tionnaires and substance of communications issued relative 
to these problems '"ill bear this out. And the recommenda- 
tions for solutions seems to vary in proportion to the 
various theories and lundamfintal codification. Conse- 
quently compliance and enforcement is difficult to obtain, 
maintpin and sustrin and public opinion, particularly as 
formed throu^,h the expressions of the various code Admin- 
istrative Agencies, becomes more critical oi the Admin- 
. istration. 

5. The vehicles of tr-^nsmisf ion of irregular decisions 

respecting Classification Problems (usupIIy in the form 
of an informrl ilAplanation) are numerous. Errors in this 
respect are due chiefly to three lailures; i.e. failure 
to recognize the existence of a problem, failure to 
recognize the limitations oi' jurisdiction and authority, 
and fpilure to understand the scope of the code or codes 
in Question, 

IV. Policy Respecting Classif i ca t ion Problems : 

1. I'hile certain policy exists respecting Classification 
Problems, as heretofore recognized in the limited 
sphere as such, there does not appear to have been 
any definite and coordinated plan of codification of 
"industrv pno trade or sub-ciivisions thereof", 

2, In general, policy respecting Classification ProDlems, 
as such, is expressed in the Procedures referred to by 
Appendix "A" attached, ••■hich also sets forth the 
mechanics of handling the problem. Certain policv is 
also expressed in the Procedures heretol'ore mentioned 
respecting Code i'iaking and An;endment, which likev^ise 
set forth the mechanics of handing such situations. 
An expansion of the Policy mentioned in the foregoing 
references relative to "true representation" is con- 
tained in a confidential memorandum by Blackwell Smith, 
Acting General Counsel, dated February 5, 1934. It 

is interesting to note that neither in this latter 
mentioned memorandum or in an/ other document, is there 
any expression as to the interpretation of vnat is 

9606 



-53- 



meant by an "industry of e sub-division thereof". 
Other rolicv relative to Exemptions is expressed in 
Office Kemos. Fos, ."82 en6 319. Oft ice Memos, 2S-8 ?nd 
?67, indirectly express certpin -policy reletive to 
classif icptions of trace ouyers. Oil ice raerao. No, 296 
also contemplates certain functioning by the Division 
of Research and Planning rhich infy disclose a Clastu- 
fication Proolem, 

3. It is also to be noted tha.t certain Orders (j^xecutive 
and Administrative) prescribing determinations reached 
in respect to specific situations, act as precedents 
for other situations and, to this extent, create 
certain Policy, 



V. SUMMArT: 



1. i-irst, it is evident that the various theories of 
codification of "industry and trade or subdivisions, 
thereoi", have FOT Deen "productive of an orderly 
amalgamation and/or arran.f^ement oi actually and 
potentially comnetitive groups and accordingly co.n- ■ 
pliance and enforcement has not only been difficult 
to obts^in but impossible under certain codes and con- 
ditions. Afain codified groups have been dis-united 
to such an extent that enterprises T"ithin the same 
all-inclusive industry or trade are in a maze of 
multiple code coverage. As a result, labor and trade 
practice provisions are not being enforced. Manage- 
ment and Labor recognize the effect but apparently 
fail to recognize, admit or remove the cause, 

2. As a corsecuence, it is evident that there must be 
a re-cocif ic-?tion and re-asserablv of industry and 
trade in order to hrinji; order 0"at oi ■:.he apoarent 
existing chaos. The anai/sis of the situation and 
the f or ,iulation and enactment of a d.ofinite and 
planned policy respecting this re-codiiication is 
vital to the entire field of industry and trade. 

3. Such situations as exist today as a result of 
rigioities and/or limiting qualifications set-up 
by definitions of industry or trades require reso- 
lution. It is. difficult to reconcile that a 
distributor of certain products ma.v or may not be 
governed by a certain code depending on -^hetner or 
not he delivers the product in a car-load lot or 
less than a car-load lot or that a manufacturer of 
certain tyres of hand tools raav oe under one code 
if he sells to one market, whereas another manu- 
facturer producing the same types of tools is under 
another code because he sells to a diversified market. 



9808 



-54- 



It is equally difiicult to reconcile that a contpiner 
Fith, a capacity of 1? i^rllons is defined under a dif- 
ferent code than one with a crppcity ol Ic. grllons, 
-All .manner of Qualifications aopesr to circumscribe 
existing codified groups, even to the extent of 
defining a manufacturing coce in terms of whether or 
not the manufacturer distributes his proouct by the 
method of "ringing door bells". It TOuld sei. m logical 
that a product or -oroducts predominately produced 
from the same material by the saiae or similar classes 
of em-oloyees operating and/or employing the same or 
similar machines or equipment rould be competitive 
by any measure insofar as manufacturing is concerned 
and therefore should be embraced by one code regardless 
oi the purpose for vhich the product is used or the 
market to rhich it is sold. Nevertheless, it is 
found that the manufacture of a certain product is 
• ■ defined under Several codes depending on where it 
ultimately comes to rest, 

4. ■ Inasmuch as the definitions in codes describing the 

amalgamation and/or composition anc/or arrangement of 
groups forming the industries and trades are the active 
centres of dislocations resulting in Classification 
Problems, it is evident that any -clan or rolicy for 
the re-codification and/or re-assembly of industry 
and trade '"ill have a bearing on the Classification 
Problem of the future. Accordingly, it 'j?oulc appear 
that co-ordination of r-ctivities regarding the 
handling of these problems is essential. Existing 
procedure separates the handling of classification 
Problems in three (3) major groupings (see Far. V-2) 
and in additior, certain problems may be referred to 
special agencies. Under such conditions it is quite 
possible that a determination reached due to an 
analysis made from one point of view may differ from 
a determination arrived at by en approach from more 
than one point of view and inasmuch as there is no 
centralized control, conflicting opinions result and 
have been issued. As an example, it is found that 
one of the more recently approved codes defines the 
products in substances as "all products of metal used 
in or on a building", ^o doubt the intent was to 
limit the field of activity but the code as approved 
(vhich is a supplemental code to a basic code) not 
only includes products embraced uy other approved 
codes (foreign to the intended industry) but also 
includes products embraced by other supplemental 
codes to the same basic code. 

•5. The value of the rhole scneme appears to depend on 
the action obtained at the source of tae trouble. 
\:ithout a definite scheme of co-ordination and control, 



9808 



-55- 



v'hich will permit the expeditious release of an un- 
qualified determination, nanngeraent, labor and the 
public, in c-^enerr], become critical. 

VI, Re comaenda t i ons : 

1. That a delinite -olan be established i or the recodifi- 
cation and re-assembly of industry and trade that is 
conducive to an orderly a.iialgamation and/or a:rrange- 
ment of actually and/or potentially competitive groups. 
The establishment of "true representation" as the sole 
'aeasure of the extent of the activities of a grour is 

■ .■ NOT sufficient nor is it ■ni'oducCtive of order. The 

separate' codii ication ol small elements of pn^ all- • 
inclusive industry on the basis of "true representa- 
tion" can be and- has been carried to such an extre'ie 
that a state of chaos nas been created that is impos- 
sible to control. 

2, ' That a centralized control and co-ordination unit be 

set up vithin the Administration rith authority to 
suTJervise and co-ordinate (1) tne re-codif ication of 
industry and trade, (2) tne handling of all -Classifi- 
cation Problems, (3) the keeping of records respecting 
products, services and functions, both codified and 
uncodified; and (4) the instructing cf all executives 
and' administering codes, including Administration 
Members and other executives at the offices of the 
severfl State I^.R. Ao Eirectors and Regional Adminis- 
trators, respecting such re-codification and the 
handling of Classification Problems. 



Prepared by: 



Office of Assistant Administrative .. 
Ofticer for Classification Problems, 



9808 



-56- 



AiD.'iendix No. 3 
^ OFFICE MEMORANDUM IIO. 282 

Auffiast 27, 1934. 
OVB-ILAFPING CODES AKD KTO^TIPL" CODE COVERACrB 

A. Overlaipninig: Codes 

1. We must avoid future ovTla-DT)ing between different codes and 
cure situations in which that conditi'^n now exists. 

2. There is no cure-all, hut the following will govern the non- 
distributive trades in cndcavorine: to effectuate the ahove -oolicy: 

(a) If definitions of industri--^s, as included 
in codes, are carefully delimited so as clearly to 
confine the scone of the code in accordance with 
the Act, overlanDing will be reduced to a miniraum. 
Section 3(a) of the Act provides for the a-o-oroval 

of codes for " tho* '*'* industry or subdivision thereof *** 

re-presented by the a-ppli cants" , and requires a 

finding by the President that the a-onlicants are 

"truly reioresentativg of such* ** industries or subdivisions 

thereof.'' 

(b) It will frequently, but not always, xjrove 
helpful in drawin? a definition of the boundary 
line of an industry to consider whether f^oubtful 
OTDcrations are or are not an " integral ipart" of the 
■orincipal ooerations of the Toa-^ticular industry. 

An "integral part" of an industry, of course j 
normally will be under its code. ( See " Exairrples " 
attached ) . 

(Suggestions for im-oroveinent should be delivered 
to the Assistant Administrator for Policy, A 
separate statement on distributive trades will 
follow, ) 

B, Mul t ipl e Codte Coverage 

1. The Problem In many cas"s, although there is no overlanmng 
of the codes involved, still a single concern may find its o-perations 
covered by two or more codes (multiple coverage), Wliile this type of case 
is unavoidable where unrolatrd businesses are conducted by a single concern, 
still confusion and hardship may arise where the operations carried on are 
not or can not practicably be segregated. 

2, Tho_ Normal Solution The following principles should be employed 
except where found to operate inequitably under particular circumstances: 



9808 



~57' 



(a); Anlenrl'ment to- t'^Vo •proTT sion s identical ; Hardshin 
arising from raulti-ole coverage T,ay frequently te eliminated 
"by sim-Dlifying a;id standardizing code nrovisions governing 
kindred induslries .by snendi-nr-iit on ''he >;ais of conference 
betw'^en and reconirar,ndatir;ns from the industries involved, 
so that the Torovisions for kindred industries are, so far 
as -possihle, sim-'Dle and identical. 

This course chould afford sufficient relief from 
multi-cle trade iDrantice TrovisionSj and ^ven from multi-ole 
Ifhor "crovisions, vrhere their requirements do not vary 
substantially,, ■^xernDtioa will normally not be considered 
in such cases until the tossibilities of such amendment 
have been ez-sloredB 

'■ • • (b) Mai nten a nce of fair conrietition; In order to main- 
tain f air ■ ccT:;T)etition no concern should be exem-oted from 
■ . requirements under wh.' cu his comoetitors witnin ''he industry 
must onerate, exce-otto the extent rsquired by conditions 
of special hardship, under the peculiar circumstances, 

■■ (c) Wher e serr sga b ion of O peration i_s feasi ble ; No ex- 
;: em-otion should be p^ranted where it is -oracticable for the 
erartloyer to segregate operations in fact or on his books 
so as to have each segregated ot»eration C'^n'form to a separate 
code. It is believed -that this rule will dispose of most 
cases. 

(d) F here r^ c^re g atio n is not_ feasible ; Where segregation, 
as above, is impracticable, there should still be no exemption 
in lal'or provisions if the employer can comply with the several 
codes. This he can do by observing the shortest hours and 
highest wage provisions for the type of work, as set forth in 
the codes in oueption. This is possibli? where such provisions 
do not varv substantially. Amendment, as sugp-ested, should be 
employed to simplify such : elated codes, 

3, The Exceptional obl ution In the final resid\ie of cases in which 
several cod^s havina- substantially diver^-ent labor provisions, cover some 
non-segregable combiaation of operations, properly conditioned exemptions 
may be granted if undue hardship is proved, 

JKOTSj It will soon be possible as a result of studies 

, now beine made to provide simple wage and hour standards 

to apply to particular classes of work within entire 

. .grqups of kindred industries. TThen such hour and "wage 

. .standards .have be-n determined we can then exempt 'the 

non-segregable operations for the group from tiie con- 

.. .f'J ictin^! wage ^and hour provisions of the various codes 

on condition that they comply with such simple wage and 
. hour standards.. ■ This cour&e will promote both justice 
and simplicity. 
By direction of the Administrator; G. A. Lynch 

Administrative Officer. 



"58- 
APPEIIDIX NO. 4 



EXCEEPTS FROM ARTICLE ENTITLED "OVERLAPPIIIO 
IN THE CODIFICATION OP WHOLESALE TRADES" by 
R.S. Alexfmder, Page 378, HARVARD BUSINESS 
REVIEW SPRING, 1935. 



ATTSIvlPTS TO SOLVE THE PROBLEM 

With resT)ect to the control of the direct-to-retailer 
selling activities of raanufacturers, the NRA ador)ted no very 
sensible or carefully considered policy. The situs of the 
control of these activities is usixally indicated in each 
specific manufacturing code in the definition of "the industry," 
Thus, if a code defines "the ind\;stry" as "the business of 
manufacturing an item and selling it by the manufacturer," that 
code Drobably governs sales made by Droducers direct to re- 
tailers or to consumers. If, on the other hand, "the industry" 
be defined as the "manufacture for sale" of a Darticular item, 
there seems some doubt whether the code including such a 
definition governs the direct-to-retailer selling activities 
of manufacturers. A great diversity of language on this point 
is found in the different codes. The following table shows 
the terms used in the manufacturing codes which indicates any 
■Dossible degree of control over the direct selling oioerations 
of the f^roducers covered by them. 

From this table it is a-onarent that some 43 of the manufac- 
turers' codes- may be so construed as to control the sales of 
wholesalers handling the -oroducts produced under the code. One 
hundred and. seventy-nine of these codes are so drawn as to 
indicate pretty clearly that they control sales made by manufac- 
turers to retailers. The language of 170 producers' codes is 
sc indefinite that interpretation is necessary to determine 
exactly the activities which they control. 



TABLE VI. DE^tREE OF CONTROL OVER DIRECT 

SELLING OPERATIONS OF PRODUCERS, AS SHOWT^I 

BY LANGUAGE USED IN THE MANUFACTURING CODES. ' 

■ . ■ .. , Sales by Manufacturers to Retailers. 

No. of Codes 
using 

1. "Manufacture and Sale by the Manufacturer" 74 

2. "Manufacture and Sale" 43 

.3. Sales to Retailers Included by Trade 

Practice Provisions , 34 

4. . "Manufacturing and Distributing by 

Manufacturer" , . , 2 



9808 



-59- 



5. "Manufacture for Sale and Sale ty 

Manufacturer " 6 

6. "Manufa^/oure for Sale and Selling;" o 5 

7. "Hanuf-T'.t'jrin^ f?",d S^llii^g cj Tc-ibers" 3 

8. "Ilp.nuiacture for General Go:i..iiorcial Resale" 1 

9. "lla^iufacdure fci Sale in Open Market" 1 

10. "I\is-.Tii.frcturin,.5 ruid Selling to all Buyers" 1 

11. "Manuiacturin:; and Selling to Wholesalers 

aud Ee l^J. lers •' 1 

12. "I'a.nufa3tnrin,^ and Distribrt ing and Sale "by 

llr-xiuf acturer ' . „ . 1 

13. Including "Direct Ikmufexturers" in definition 1 

14. "Manufacturing a.nd l^j stribution" 4 

15. Including all Sales "by Taxiufacturer tut not 

Sales of TJholesalers" 2 

Total 179 

TO BE IKT'REPRETED 

1 . "Manufacture for Sale" . , . , 138 

2. "I^aiiufa'^ture and Original os.le" 16 

3. "Manufacture and Original Sale "by 

HETiufc.crj.rers" 5 

4. "Manuf •i.:tiire and Prlriar;!.^ Sale" 5 

5. "Msnuf acture a^.i Prinary D.i striDution 3 

6. "I'anufaoture for Frinarj" Di s oxlbut-^ on 1 

7. "Man-jfacture and/or P"cimary Idstritiution 1 

8. "Manufacture and Original Selling and 

Distributing "by Manufacturer" 1_ 



Total 170 

MAY lUCLUDE ¥HCLSGALZRS 

No. of codes using 

1. "Manufacture and/or S^-.le" 12 

2. "Manufacture and/ or Sale "by Manufacturers" 15 

3. "Manufacture or Sale "by Manufactiirers" 2 

4. "Ma.:; if ai taring. Selling, and Distributing 

"bj' M;uTCfactarers" 5 

5. "Mamifactaring and/or Distri"buting ty 

Mi Qi.f Hcturers 2 

6. "Manufacture for Sale and/ or Selling "by 

Manufa'' •; irer" 1 

7. "Mauuf s ^ t ire for Sale and/or Distribution 1 

8. "Manufacture for Sale and/ or Di3tri"bution 

ty Manufacturer" 1 

9. "Manufacture for Sale and/ or Sale 1 

10. "l.;anufact''iring and/or Selling and/or 

Di'3Tri""buting "by a Mem'ber" 1 

11. "Manufacturing for SaJ.e or Sale in 

Open Ma.rket " 1 

12. "Manufacture and Original Sale and/ or Wholesale 

Distribution by a Member 1 

Total 43 

9808 



-60- 

A^T^iiDix no. 5 

N.R.A. 

Legal Division April 29, 1935 

nW.ORANDim 



To: L. C. Marshall; Exerv.ti'-e Secretary, 
National Indus r. rial Hecovery Poardo 

From: Jos. H. McConnell, Section Counsel 

Re; Classification Problem Arising under Electrical 

Division of tho Ocnstruction Code and the Rail^vay 
Safety Ap^oliance Code, 

In accordc-mce with your request at the heprin^ on this matter, I 
am submittir.^' here"'ith a brief analysis c-f the facts and the arguments 
on each side of this queshion- A ;;rs<'',t mass of materisl has been 
submitted fo: ths consideration of the Board,, I nave pone over most of 
this and find, that to a large extent it is T;",:olly irrelevent. I shall 
not, therefore, discuss all of the evidence liubmitted. 



The General Rail^■7ay Signrl Com"ca,:i7 entered into a contract with the 
City of New Yorlc to furnish arid install signal ecuLpmenl'. on the 
Independent Ciry-owned Raijid Tr.ansit r.ailroad. This ccnc\overay per- 
tains only to the i.istallation of matci-ials furniEhed, ai-'l has nothing 
to do with the manui-'-'cture of pa.;"et^' a'n •liancfts,. ^.'he installo.t j.on of 
the safety si'stemj for the TourT.oses of t.i"i,E considsration. can be rough- 
ly segregated into (.1) the actiial settitig u>j of tnc safety ax3X)liance it- 
self, and (j:) the installation of all ths p,"^.'oara,tus attached to tne 
appliance necessary for its loro'oer fuiiCt'ioring^ The controversy'" can be 
further narrowed do\7n to the arbitrarily designated second "oart of the 
installation process. 

The members of the Railway Safety ATO-oliance Industry in fulfilling 
this cuntrrc'c to do all of the installation thyraselveSf have in the 
past been operating wholly'- under the RaJJ.waj' Safety A-p'?liance Industry 
Code. In installing the ap'oaratus necosspry for tl'e prooer fanctioning 
of the apToliauce itaeli, there is evidence to show that the Railway 
Safety Appliance monbers insta.ll transf or!r.er<' , conduits and perform 
various other functions which are likewise perforintd by the ordinary 
electrical contr?c^o^, although the electrical contractor does not 
install these various parts to be util:red as a part of a railway 
safety appliance syrtem. There is evidence tending to shew thrt the 
electrical contractor in his activities does •"oy]<. just as complex as do 
the mer.bers of ^he Railway Safety Appliance Industry. The electrical 
contractor in doing t.ds same type of work where it is not connected with 
safety appliances, opera.tes under the Electrical Division of the 
Construction Industry Code. The Railv.'ay Safety Appliance Industry 
offered evidence to the effect that the instpllation of safety appliances 
has, through a long period of years, been done by persons known in the 

9808 



-61- 

Industry as signalmen. These signalnen are eimaloyed only by the rail- 
roads who install their own safety ap-oaratus , or hy the menters of the 
Railway Safety Apnliance Industry v^ho install, in about half of the 
cases, the apparatus which tliey manufacture. 

In order to show that historically the installation of safety 
aprjliances is an Industry seoarnte from the Electrical Contracting 
Industry, the Railway Safety A-O'-'liance Industry offered evidence tend- 
ing to show that this installation is always done hy signalmen and 
is never done "by ordinary electriciar^s , chiefly because the electri- 
cians are not cp.'oable of TDerforming the services^ The Electrical 
Contracting Code Authority and the Electrical Union roTDresentatives 
offered evidence to sIjcw that electricians are perferctly capable of 
doing the work, although they did not offer any evidence to show that 
in recent years any of the installation process had, been performed 
by general electricians. 

These are the most "oertinent facts in this controversy. The most 
salient fact of all is that in the above f'?3ignated second part of the 
installation process, the Railwp„y Safety Appliance Industry performs 
exactly the same services as do the ordinary'- electrical contractors, 
although the services are not performed by the electrical contractors 
in the installation of raili^ay safety appliances, 

THE C OSES 

The Railway Safety Appliajice Industry Code includes within its 
definition of the Industry "the business of the design, development, 
manufacture, sale, and installation of power brake, signal, and train 
control systems ****". This Code was approved January 12, 1934, 

The Electrical Contra.cting Industry Code includes in its definition 
"the erecting, installing, altering, repairing, servicing, or main- 
taining electric wiring, devices, appliances, or equipment, including 
the purch-^sing from suppliers and the selling of manufactured parts and 
products incorporated in such installation"'***. This subdivision of 
the Construction Code was approved on April 19, 1934. 

AF:CrlB.!ElTT3 

It is contended by those who maintain that the installation of all 
apparatus leading up to t,he actual si,gnal device is within the 
Jurisdiction of the Railway Safety Appliance Code that: 

(l) The actual wording of. the definition of the Railway Safety 
Appliance Code includes the installation of the entire safety system. 
This Code was proposed by a group tha,t represents practically all of 
those who manufacture and install railway safety systems. 

The Electrica.l Contracting Industry Code was proposed by persons 
who did not represent any of those who manufa.cture and install safety 
ap'olianccs. Consequently, the Railway Safety Aiooliance Industry Code 
is the only Code which complies with the requirements of Section 3 (a) 
in that it was proposed by the only group performing all of the 
functions covered by the definition, 

9808 



, ^ -62- 

(2) The Rail'-'ay Safety AP"oliance Code is more specific in its 
■terras thpji the Electrical Contracting Code since it applies to the 

manufacture and installation of railway safety appliances only. The 
Electrical Code on the other hand covers the installation of all 
electrical equipraent and is thus general in its terras. Therefore, under 
familiar rules of construction, the more specific prevails, 

(3) It was the intention of the S^iliTay Safety Appliance Code to 
cover completely the raanuf-.cture and installation of rail'.vay safety 
systems as evidenced hy the fact that the manufacture and installation 
of these systems have alvrays teen performed either by the railroads or 
the members of this Industry. The installation of the entire system 

is as much an integral part of the Industry as is any other function of 
the Industry, Therefore, a Code aporoved for the Rail'/7ay Safety 
Appliance Industry, and vonl'^d. as their Code is, was intended to include 
'■•ithin its definition the complete installation of the safety equipraent. 

(4) They maintain that Section 3 (a) of the Act provides for the 
approval of Codes for divisions or subdivisions of an Industry, and that 
insofar as the installation of signal appliances is concerned, the 
Administration has approved a Code for a subdivision of the Electri- 
cal Contracting Industry, namely: the installation of safety appliances, 

(5) The two members of the Railv;ay Safety Appliance Industry 
involved have entered into a contract with the City of New York, said 
contract being predicated on the performance of the services therein 
required under the provisions of the Railway Safety Appliance Code, 
Therefore, it is unfair to increase the cost of performing the contract 
by requiring the two members of this Industry involved to conform to 
the more stringent labor provisions of the Electrical Contracting Code. 

Those who maintain that the installation of these parts necessary 
for the functioning of the safety aPTjliances should be performed iinder 
the Electrical Contracting Indiistry Code contend that: 

(1) The members of the Electrical Contracting Industry install 
exactly the same apparatus as is used in the installation of the railway 
safety appliances, although they do not install it in connection with 
railway safety ap-oliances. However, they install a large majority of 
this type of apparatus and are, therefore, representative of the group 
performing the services of installing transformers, conduits, etc., 
which are the srne services the members of the Railway Safety Appliance 
Industry are rendering. It follows then, that they are the only group 
truly representative of those performing this service, and their Code 

is the only valid Code cove-ing the performance of such services. 

(2) The Electrical Contracting Industry Code was approved sub- 
sequent to the approval of the Rail"ay Safety Aprjliance Code which 
covers the installation of all electrical equipment. Therefore, this 
Code, having been approved last, prevails. In answer to the argument 
that such a construction would give no effect to the word "installation" 
as used in the Railway Safety Appliance Code, it can be contended that 
"installation!' means the installation of the actual safety appliance 
and not the installation of the apparatus necessary to the operation 

of the appliance. 

9808 



-63-- ' 

(3) One of the purposes of the- i^ational Industrial Recovery Act 
is to proaote fair corn-oetitiono The Zlectrical Contracting; Code is 
more onerous in its l-"TDor "orovisions than is the EailTray Safety 
Axioliance Code. In order for a. tjerson installing rail'"'ay safety 
a-ooliances to cone -ri thin the -definition of the Rail'/ay Sa.fety Appliance 
Code, he must also ina.nufacture the Tjroductr, Therefore, the electrical 
contractor, who wist install safety aopliance equ-i"o:nent according to 
the labor reouiroaents of the Electrical Contracting Code, is placed in 
an unfair comTjetitive situa'Cicno" 

(4) It can te maintained that the RailiTay Sfifety Appliance Code 
covers installation onl^- insofar as installation is of Toroducts 
manufactured by the E: liray S-aety Ao'oliance Industryo The arjparatus 
used in connectint^ the .3a.fety aTD"Dlir^ices for pronnr ope'>"ation is not 
f^enerally manufactured by members of the Ra,ilr'ay Safety Ap'oliance 
Industry. Therefore, the v/ording of the Codes does not include the 
installation of these outside -oroducts. (Several of these contentions 
were not in fact made by the electrical contractors, but it seems to 
me that they might have ■'"/ell been nade. This last contention is one 
of those, ) ■ 

■ CO' CLITSIOI I 

It is the opinion of the Leiy'^l Division thnt all the services 
performed in the installation of •mil'^'ay safety ap.^^lianCe devices coiiie 
within the definition and the jurisdietiOA Of the Railway Safety 
Appliajice Code. The Code in its wording includes the racinufacturing 
and installation not only of ■ railway -sa,fety appliajices, but th^ in- 
stallation of signal sysbems o All of the services involved in- the 
controversy are necessary for the installa,tion of a system . If it 
were not for the use of the term "system", it might be held that the 
installation applied onlv to the safety appliances themselves, but thi$ 
contention of the electrical- contractors cannot -be maintained because 
of the use of this terror Moreover, it appears to us from the evidence 
submitted tha.t historically the Railway Sa.fety Applianc9 Industry in- 
cludes the installp.tion of the entire system. Consequently, it is an 
integrated Industry. , , • . - . 

Those who proposed the Rail^-^ay Safety Appliance Code represented 
almost completely those who manufacture and install ra.ilway safety 
appliances systemsc The electrical contractors, although representative 
of those who install tne.same ap'oaratp-s as does the Railv/ay Safety 
Appliance Industry, are not representative of this integrated Industry 
in performing both the manufacturing and installation of the system. 
The contention of the Railway Safety Appliance Industry that the more 
specific prevails also seems to us to be '.'ell founded. 

\le recoranend, therefore, that a ruling be made stating that the 
performance of the services in question is under the Railxvay Safety 
Appliance Code, but we recoranend that this ruling be specifically limited 
to the manuf.actare and installation of systems so that in the future in 
the consideration of various other codes (there are about ninety-tv/o) 
which cover installation, '''e will not ha,ve precluded a sound determina-^ 
tion on a particular set of facts. 

Jos. H. KcConnell 
Section Counsel 
0808 



APPEITOIX NO. 5 

NATIONAL EECOVEHY ADMINISTHATIOrl 

ORDEH NO. 198-7 

CODE OF FAIH COI><IPETITION 

FOR THE 

RAILWAY SAFETY APPLIANCE INDUSTRY 

Exenroting MeralDers of the Railway Safety Appliance Industry Who 
Install Signal Systems of Their Own Manufacture From Any Code or 
Codes of Pair Competition Which Puroose to Cover Such Installation 
Other Than the Code of Said Industry 

WHEREAS, the Code of Fair Competition for the Railway Safety 
Appliance Industry specifically covers the installation by the manu- 
facturer thereof of signal systems which have for their object the 
safeguarding of movement of cars, locomotives or trains on railways, 
and 

WHEREAS, certain other Codes of Fair Competition purport in 
general terms to cover such installation, and 

WHEREAS, it appears to the National Industrial Recovery Board 
that to require members of such Industry who install su.ch systems 
of their own manufacture to comply with such other codes in the 
installation of such systems would result in hardship to such mem- 
bers, and that the exemption herein granted will tend to effectuate 
the purposes of Title I of the National Industrial Recovery Act: 

NOW, THEREFORE, pursuant to the authority vested in it under 
said Title of said Act by Executive Orders of the President, in- 
cluding Executive Order No. 6859, dated September 27, 1934, and 
otherwise, the National Industrial Recovery Board hereby orders 
that members of the Railway Safety Appliance Industry who install 
signal systems of their own manufacture which systems have for 
their object the saf eg'uarding of movement of cars, locomotives or 
trains on railways be and they are hereby exempted, as to such in- 
stallation, from compliance with any Code or Codes of Fair Competi- 
tion which purport to cover such installation other than said Code 
of Fair Competition for the Railway Safety Appliance Industry. 



NATIONAL li^lDUSTRIAL RECOVERY BOARD 

BY_ L. C. MARSHALL 
Washington, D. C. 



Executive Secretary 



May 24, 1935 
9808 



-65- 



APPEI^IDIX F0.5 



C01i:?LICTS 



CODE 



Electrical Manufacturing 
Industry 



(industrial Resistance 
Furnace) 

Wliolesale i.ion'umental Granite 
Industry 

Concrete Masonry Industry 

Concrete Pipe Manufac tearing 
Industry 

Glass Container Industry 

Window Glass Mfg. Industry 

Petroleum Industry 



Lumber Cz Tim'oer Products 
Industries 



Dowel Pin Manufacturing Inc.ustry 

Venetian Blind Industry 

Metal Moulding &. Metal Frame 
Industry (Division of Fictui'e 
Moulding a Picture Frame Ind.) 

Hardvraod Distillation Industry 

9808 



VEESliS CODE 

(Fan & Blower Industry 
(Comiriercial Refrigeration Industry 
(Re frige rat ion Indus t ry 
(C-ear Hamifacturing Industry 
(Electric Overhead Crane Industry 
( (proposed MAPI) 

(Fool Service Equipment Industry 
( (proposed MAPI) 

(Artistic Ligliting Equipment Manu- 
( facturing Inc. (Fat. Metal Prod.) 
(Industrial Furnace Manufacturing 
( Industry 



Construction Industry 

Construction Industry 

Construction Industry 

American Glassware Industry 

Flat Glass Manufacturing Industry 

(Construction Industry 

(natural Gas Industry (Proposed) 

(Furnitxire Manufacturing Industry 
(Comriercial Fixtures Industry 
(PulDlic Seating Industry 
(Y,'ood Turning & Sliaping Industry 
(Uooden Insulator Pin c: Bracket 
( Maniifacturing Industry 

Dovirel Manufacturing Indus trj^ 

(Division T7ood Turning & Shaping) 

Vifoven V;ood Fahric Sliade Industry 



Fabricated Metal Products Industry 
Haval Stores 



-66- 



CODE VERSUS 

Anti-Hog Cholera Ser-um & 
Hog Cholera Virus Ind. 

Pharmaceutical L Biological Ind. 

Package Medicine Industry 

Perfume & Cosmetic Industry 

Rainvrear Division - 

Ruhber Manufacturing Ind. 

Sundries Division - 

Ruhher Manufacturing Ind. 

Mechanical Rubher Goods 

Division Rubher Mfg. Ind\i.stry 

Graphic Arts Industries 



Ci^:,ar Container Inr'.ustry 



Valve C- Fittings Manufacturing 
Industry 



Automatic Sprinkler Industry 

Cooking c. Heating Appliance- 
Mfg. Industry 

Hoist Luilders Industry (I'LAPl) 

Road Machinery Mfg. Industry 

Punip Manufacturing Industry 



American Petroleum Equipment 
Industry & Trade 



CODE 
Pharmaceutical E: Biological Ind, 

Package Medicine Industry 
Malt Products Industry 
Witch Hozel Industry 

Cotton Garment Industry 

Sanitary <?: Vfeterproof Hose (?; 
Tuhing rfg. Inc. (FMP) 

Flexihle Metal Hose & Tuhing 
I'anui'acturing Ind. (FMP) 

(Guxmied Lahel & Emhossed Seal Inl 
(Sample Card Industry 
(Tag Industry 

(Set-Up Prper Box Industry 
(Glass Container Industry 
(Fabricated Metal Products Ind. 

(plumbing Fixtures Industry 
(Air Valve Industry 
(Refrigeration Valves & Fittings 
(Mfg, Industry 

Construction Industry 

(Gas A":"iliances & Ap':>aratus Ind, 
(Liquid Fuel A'ipliance Mfg. Ind, 
(Gq.s Cook Industry 

Hoisting Engine Mfg. Industry 

Shovel, Dragline & Crane Ind, 

Contractor's Pump Industry 

(Gasoline Pump Mfg, Industry 
(Metal Tan]i Industry 
(Tank Erecting Industry 



9808 



-67- 



CODE vizasus 



Scientific Apparatus Industry 



Parm Equipment Industry 



Rock & Ore Crusher Inaustry (MAPI' 

Chemical Engineering Equipment 
Industry 



COSE 

(X-Riy, Electro-!!edical and 

( S-'jn Lamp Industry 

(3\isiness ?iu-niture, Storace Equip- 

( ment C: Filing Supply Ind, 

(Marine Equipment Mfg. Industry 

(Graphic Arts Industries 

(Au.tomooilo Mfg. Industry 
(Concrete Mixer Industry (MAPI ) 

Rock Crusher Mfg. Industry 

Chlorine Control Appar^.tus 
Industry c"; Trade 



Railway Brass Car cc Loccmotive 
Journal Bearing L Casting Ind. 

Automotive Parts Jc Equipment Mfg. 
Industry, Code Mo. 105, conflicted 
with all of the following Codes: 

237 Alloy Casting 

470 Alm.iinum 

138 Anti-Triction Bearings . 

417 Batting &. Pacding ' ' 

96 Buff & Polishing Wheel 

152 Can 

202 Carpet & Rug 

551 Clock Manufacturing 

486 Commercial Vehicle Body 

336 Covered Button 

212 Drapery c: Upholstery Trimxiing 

4 Electrical M:,nufacturing 
Electric Storage Battery 

84 Pahricated Metp.l Products 
and Supplements 

98 Eire Extinguisher 

541 Plat Glass Mfg. 

409 Plexiole Insulation 

117 Gear Manufacturing 

36 Glass Container 

170 Grinding Tfmeel 

11 Iron c: Steel 

416 Leather Cloth and 

Lacquered Pahrics 



Mon-Perrous Foundry Industry 



Mfg. 



Frozen Desserts Indiistry 



42 Luggage c: Fancy Leather Goods 

9 Lunher L TinLer Products 

105 Machine Tool ci Forging 

347 Machinery "■. Allied Products & Supji 

69 I'arking Devices 

428 Meciianica.1 Packing 

455 Metal Etching ; 

154 Metal Tank 

367 Metal Treating 

71 paint, Varnish I- Lacquer Mfg. 

477 PuDlic Seating 

57 Pump Manufacturing 

211 Robe f: Allied products 

274 Sa.v & Steel Products 

114 Scientific An^iaratus 

85 Soap & Glycerine 

122 Special Tool, Die and 

Machine Shop 

397 Spray Fainting e Finishing 

Ecuipment Mfg. 

329 Upholstery Spring 

277 Gray Iron Foindry 

165 Mon-Perrous Fo\mdry 

153 Mallca'ble Iron 

Food Desserts (Proposed) 



Accessories 



9808 



•-68- 



C-ray Iron Foundry Incus try 

Can M.9n-afactiirerB Industrj*^ 
HoucehQld Ice Refrigerator Ind. 

Coinmercial Fixtiore Indiistry 

Public Seating:: Industry 
Athletic Goods I'.fg. Industry 

Graphic Arts Industries 



AdvertisiniS: Specialty Industry 

Eadio Broadcasting ly.dustry 
"larlring Tevices Industry 



Construction Industry 



Autonotive Parts & Equip. Ilfg. 
Mine Car r-rmv.facturing Industry 

liAPI 

Cast Iron Soil Pipe Industry 

Cast Iron Pressiire Pipe Industry 

Milk & Ice Cream Can '^fg. Industry 

Refrigeration Industry (NEMA) 

(business F^u'nitxire, Storage Equip- 
( ment "; Piling Supply Industry 
(puhlic Seating Industry 

Furniti\re Manufacturing Industry 

(Knitted Outeruc^ar Industry 
(Boot c".- Snoe I'fg. Industry 

(office Equipment Manufactiirers Ind, 
(Filing Supply Industry 
(S:oecialty Accoimting Supp. Mfg. Ind. 
( and all Paper Codes v/aich covered 
( printing on their products 

(APEM (Tire Covers) 
(Toy C- Playthings Industry 
(Cap r?: Cloth Kat Industry 
(Gra-'hic Arts Industries 
(KiP (Sly Swatter and others) 

Comniuni Ctat i ons (Y/i re le s s ) 

(PMP (Various Supplements) 
(p.uhber Manufacturing Industry 

(Trucking Industry 

(Food Service Eq\iipment (Proposed-l\TEI/iA 
(Metallic Wall Structure Ind. (FltP) 
(Public Utilities (Gas Lines) 
(PetroleiJin Industry 
(Farm Equipment Industry 
(Commercial Refrigerator Industry 
(Crushed Stone, Sand & Gravel & Slag I 
(Commercial Fixtures Ind\istry 
(Oil Burner Industry 
(Architectural, Ornamental C: Miscella- 
( neous Iron, Bronze, Wire c": Metal 
( Specialties Mfg. Industry (FIvEP) 



TEXTILE DIVISIOiT 



Cotton Textile Indiistry 
9808 



(Silk Textile Industry 

(Surgical Dressings Industry 

(l.hlk Filtering Materials & the Dairy 

( Products Cotton WrapiTings 



-69- 



CODE 



^/IRSUS 



CODE 



Silk lextile Industry- 



Wool Textile Industry 



llarrov; Fabrics Industry 



Textile processing Industry 

Bias Tape Industry 

Drapery c"; Upholstery Trimrnin^, Ind. 

\'Ielt lianufacturin;?; Industry 

Sat ting C: Padding Ind.ustry 

Wool Felt Industry 

Brattice Cloth Mf^. Industry 

Leather Industry 

Ladies Handbag Industry 



Shoe Manufacturing Industry 



(Slit Fabric Ilfg, Industry 
(Bias Tape Mfg. Industry 
(upholstery i Drapery Textile Ird . 

(Rayon & Silk Dyeing & Printing Ind, 

( Ve Iv e t I ndus try 

(Upholstery &, Drapery Textile Ind. 

(Cotton Textile Industry 
(Upholstery c. "rapery Textile Ind. 

(''anui'acturing &. Yftiolesale S^orgical Ind, 

(Bias Tape Iiifg. Industry 

(Drapery ^; T^pholstery Triimning Ind. 

(Corjet (' Brassiere Industry 

(Millinery C Dress Trimming Braid 

( & Textile Industry 

(Underwear i-. Allied Products Mfg. Ind, 

(Cotton Textile Industry 

(Ltosiery Industry 

(H; yon & Silk Dyeing & printing Ind, 

(Silk Textile Indaistry 

(Wool -L'extile Industry 

Slit Fahric Ma,n"al'acturing Industry 

("iiillinery c; Dress Trimming Braid 
( and Textile Industry 

APEM 

(Dry C-ood.s Tatting Industry 

(Yfcdding Industry 

(l^edding Manufacturing Industry 

(I-Iair & Jute Felt Industry 
(pepermal'ers ' Felt Industry 

Soft Fibre Mfg. Indiistry 

(Luggage c; Fancy Leather Goods Ind. 
(Saddlery IJfg, Industry 
(Athletic Goods Mfg. Industry 
(Advertising Specialty Industry 

Luggage (T: Fancy Leather Good Ind. 

(Shoe Pattern Mfg. Industry 
(Leather Industry 
(stay Manufacturing Industry 
(Shoe Last & Shoe Form Industries 
(Wood Heel Industry 



9806 



-70- 

CONFLICTS - TEXTILF. DIVISION (Continued) 
CODE VrRSUS 



Pur Manufacturing Industry 



Hen's Clothing Industry 



•Coat L: Suit Industry 



Infants' & Children's Tifear Ind. 



Women's rieclcwear -.": Scarf 
Mfg. Industry 



Corset cS; Brassiere -Industry 



Cotton Garment Industry 



Rohe 6: Allied Products Industry 



9808 



CODE 



(Retail Custom Fur Mfg. Trade 

(iTur Vfiiolesaling £: Distributing Trade 

(Coat Front I.^fg. Industry (Unapproved) 
(Shoulder Pad Hf^. Industry 
(Rainv/ear Division-Ruhher I.'Ifg, Industry 
(iloolens .£■. Trimmings Distributing Trade 
(Cotton Garment Industry 

(Dress Manufacturing Industry 
(pleatin;--, , Stitching & Bonnaz L Hand 
(Emhroid-ery Industry 

(Cotton C-a.rment Industry 

(Light Dewing Ind, Except Garments 

C'?obl Textile "Industry 

(Cotton Textile Industry 

(iCnitted Outerv/ear Industry 

(Underwear •^ Allied Products Mfg. Ind. 

(Dress Maniifs.cturing Industry 

(Rohe &. Allied Prod, Mfg. Industry 

(Underi^arment c; ITegligee Industry 

(Coat ?.: Suit Industry 

(Cap & Cloth Hat Industry 

(V'omen's Neckwear t-, Scai'f Mfg, Ind, 

(Rainuear Div.- Ruhher Mfg, Industry 

(Advertising Specialty Industry 

(Blouse [■ Sliirt Mfg. Industry 

(Bress Man-ofacturing Industry 

(Handlcer chief Industry 

(Pleating, Stitching & Bonnaz & 

(. Hand Emhroidery Industry 

(infant's a.n'S. Children's Vfear Industry 

(Garter, Suspender <?: Belt Mfg, Ind, 
(Narrow :^abrics Industry 
(Manxifacturing & Vfholesale Surginal Ind, 

(Men's Clothing Industry 
(Dress Manufactixring Industry 
(Blouse i: 3!:irt Mfg, Ind, 
(Underwear c"; Allied Products Mfg, Ind. 
(Raim/ear Div. -Rubber Mfg. Industry 
(Robe & Allied Products Industry 
(Infants' &. Children's V/ear Industry 
(Athletic Goods Mfg, Industry 
(Advert isin,-^ Specialty Industry 

(Dress Manxifacturing Industry 
(Undergarment co Negligee Industry 



-71- 



COITFLICTS - TIXTILE LIVISIO:! (Continued) 
CODE '.CRSUS 



CODS 



Underwear i Allied Frodx^cts Ind, 



Bone Button Industry (proposed 

Celluloid lutton, Buckle & 
Hovelty Mfg, Industry 

Pi-"bre P.: lietal \7orl- Clothing Button 
Mfg. Inctustry 



Knitted OuterY/ear Industry 
Hatters Fur Cutting Industry 



Pleating, Stitching c, Bonnaz & 
Hand Emhroidery Industry 



Leather & '"oolen Knit Glove Ind, 
Cap & Cloth "iat Industry 
iiillinery Industry 



Garter, Suspender & Belt 
Mfg. Industry 



Handkerchief Industry 
Women ' s Belt Indus t ry 
Hosiery Industry 
Men's lleclcv^ear Industry 



(Mfg. & Wholesale Surgical Ind, 
(Undergarment & ITegligee Industry 

Medi-am Cz Low Priced Jewelry Mfg, Ind, 

(M'ediuH L Low Priced Jevjelry 
( Mfg. Industry 

(M?ui^Jin ' Low Priced Jewelry Mfg. Ind. 

{T.y) 

(Dress Manufacturing Industry 

( ! ; i 1 1 i ne r y I ndu.s try 

(Underwear & Allied Products Mfg, Ind. 

Hat Manm'-cturing Indiistry 

(Schiffle, The Hand Machine Emhroidery & 
(The Emhroidery Txiread & Scallop 
( Cutting Industry 
(Ladies T-iandhsg Industry 
(Dress Mam;.facturing I dustry 
(iJovelty C-ortain, Draperies, Bedspreads 
( & iJovelty Pillow Industry 
(Advertising Specialty Industry 

(Cotton Cloth Glove Mfg, Industry 
(Knitted Outerwear Industry 
(Underwear &. Allied Products Mfg. Ind, 

(infants' c Children's TJear Industry 
(Advertising Specialty Industry 

Knitted Outerwear Industry 

(V/omen's Belt Industry 
(llarrov; Fabrics Industry 
(Leather Industry 
(Saddlery Mfg, Industry 

Cotton G?r.nerit Industry 

(Leather Industry 

(Dress Manufact-ai'ing Industry 

(Cotton c: Suit Industry 

Textile Processing Industry 

(■Roman's Heck-wear <?, Scarf Mfg, Ind, 
(Knitted Outerv;ear I-nd~.i.stry 
(Harrow Fabrics Industry 



9808 



-72- 



COlirLICTS - TTXTILI! DIVISIOII (Contimied) 



CODE 



Canvas Goods Industry 



^.RSUS CODE 

(Lic'f^t Sexving Industry Except Garments 

(l?la;3; Manufacturing Industry 

(Textile rag Industry 

(Ready-; !ade Furniture Slip Covers 

( ManufactLxring Industry 

(Closet Accessories Industry (Proposed) 

(Sliower C\irtains ;:fg. Industry (Proposed 



Novelty Cii-rtains, Draperies, 

• Bedspreads £; ilovelty pillov/ 
Industry 

P.eady-IIade Furniture Slip 

Covers llanufacturing Industry 

• (Light Sewing) 



ITottingliam Lace Curtain Industry 

(Canvas Goods Industry 

(APEM 

(Closet Accessories Industry (Proposed) 

(Shovrer Cxirtain Mfg. Ind, (proposed) 



9808 



-73- 



APFEilDIX 7 
COITSTEUCTIOIT CODE AUTECPJTY 
ITATIONAIi TESSS BUILDI1I& 
WASHIN&TQIT. D. C. 



March 12, 19G5 



i'lational Industrial Recovery Board 

YiTashington, D. C. 

Gentlemen: 

There is transmitted herewith properly c:':ecutcd agree- 
ment between the Construction Code Authority, Incorporated, and 
the Cotton Textile Code Authority, together v;ith properly 
attested documents indicatint_. the power of the siginatories to 
execute this 8tjreement. 

T/e request that an Order he issued confirming this ' 
agreement in order thpt it may become enforceable under the two 
Code Authoricies which are ■'parties to the agreement. 

Very truly yours, '■ 

COIISTEUCTIO-:- CODE AUUHOPJTY, IKCOEPOHATED 
■ . By /s/ S. F. VOORHEES 

S. E. Voorhees, Chairman 
COTTOli TEXTILE CODE AUTHOHITY, 
By ■ /s/ GEO. A. SLOAIT 

Geo. A. Sloan, Chairman 



9808 



-74- 
APPENDIX 7 



AGREEM ENT BY Al'D 33TWBEK TH E COIISTaU CTI Or CODE AUTH ORITY. 
INCGRPOPATED. AID TIZ C O TTON TEXTILE CODE AUTHORITY. 



THIS AaESElIEKT, made a.id entered into at Hew York City, New York, 
this 12th day of March, 1935, Ly and betv/oen the Construction Code 
Authority, Incorporated, including its respective divisions, and the 
Cotton Textile Industry CoiTmiittcc, the Code Authority under the Code 
of Fair Competition for the Cotton Textile Industry, witncsseth, that 

WHEREAS, difficult and perplexing iDroblcms ha,ve arisen as to the 
possible overlapping of 'the prdVisioii^p of the Cotton Textile Code and 
the Construction Code, as to \vhethcr certain operations of manu- 
facturers who are subject to the Cotton Textile Code, are governed hy 
the provisio:"is of the Cotton Textile Code or by the Construction Code; 
and 

TiYHSREAS, representatives of the respective oarties hereto have 
considered said problems and have presented a satisfactory basis for 
the resolution of aiv such problems: 

HOW, THEREFORE, in consideration of the agreements hereinafter 
set forth, the parties mutually agree, that upon the approval of this 
agreement by the National Recovery Administration all questions of 
overls,pjping provisions of the Cotton Textile and the Construction 
Codes therea-ftor arising shall be resolved along the following general 
principles: 

(a) Operations performed by a Manufacturer who is subject to the 
Cotton Textile Code on his own premises and not for compensation 
or hire, shall be deemed to be governed by the provisions of the 
Cotton Textile Code and the provisions of the Construction In- 
dustry Code shall not apply thereto, provided, that such opera- 
tions are confined to repair and maintenance items and to minor 
items of replacement, alteration and additions, in so far as such 
work is done by th^^ Manufacturer's employees holding regular jobs 
providing permanent employment; but employees temporarily en- 
gaged for such work shall be governed by the provisions of the 
Construction Industry Code. 

(b) All other constructioh v;ork_ performed by a Cotton Textile 
Manufacturer shall be governed by the provisions of the Con- 
struction Industry Code. 

(c) A coniinittee coraDosed of three members to be named by the 
Construction Code Authority, Incorporated, and three members to 
be named by the Cotton Textile Code Authority shall pass on 
cases in dispute which ;n£V:'" hereafter arise, and in the event 

of their disa^^roement they shall call in an additional im- 
partial member whoso views shall be acceitited as those of the 



9808 



Comraittce. The re-oort of such comnittec shall be accepted and sup- 
ported by the respective Code Authorities. 

IN WITIIESS ITHElffiOr, the duly authorized representatives of the 
parties hereto have hereunto sot their ha.nds the day and year first 
above written. 

CONSTRUCT I OIT CODE AUTHORITY, IKCOHPORATED 
By S. F. V00RHE3S. 



S. Y. VoorhecE, Chairman 

T/itncss: 

M. MOHR 

Cotton Textile Industry Committee 
Code Authority under the Code of 
Fair Competition for the Cotton 
Textile Industry 

By GEO. A. SLOAIT 



Geo. A. Sloan, Chairman 
Vtitness: 
C. W. METCALF 



9808 



-76- 

APPSIIDIX rO. G 
; ■ ■■ ,. IIATIO]:;iX ri:COFj:?.Y ADl.Ii.'ISTHilTIOE • ■ 

II MEDIATE ZELZASE 

AUGUST 27, ID 34 ZKLEASE 110.7482 

EM AirilOUlICSS ilETJ CODE GROUP irGS 

Tlie rational Recover:^ Acb';iijii strati on toda.;;'- announced as part of 
the :;enera3. procrai-.i of in-oroveiient , a virtually coiaplete realignment 
of its Code Groupings to coniori to a ne':' futidaiiental classification 
of all industries and trades. 

This basic classification, completed after studies of many months, 
assi^iied jy General Hugh S. Johnson to a speciall;" created economic 
unit, corresponds closely to the groupings of the Census Burear and of 
the International classification, out is more thoroughly developed than 
either. 

i[e3-note of the classif icrtion is recognition of 22 classes nith- 
in -'hich every inovm industry or trade has a definite place. 

The effect of the classification on ITIU.' s adiinistrative machinery 
vrill he; 

1. Assembling of codes into 22 industry grotroings under the 
e::isting industry divisions. The rections thus asse'ihled have been 
transferrec rj:ong the divisions so tliat each contains only the most 
closely allied grou-'is defined by the ne'T classification. 

2. Transfer of personnel in many cases so as to heep exi^erienced 
men 'Tith their codes. 

3. Tt.'o or three master codes rrill have their component supple- 
m.ents distributed ai:ong several dei^uties, but always under the direction 
of a single division head. 

The res,r.ons for the changes a.re: 

1. Assurance that allied lines receive identical treatment on 
comi 1 on '0 rob 1 en s . 

2. Reduced administrative overhead by eliminating duplication 
of functions cr.C. studies. 

3. Opportunity for nanj' allieo. codes to merge b-;' voluntar;- 
action of inc'iistry for greater econo'^y in the self-government function. 

4. Cleared perspective on the several clashes of codes, r.-ith 
consequent greater definition of the problem to be solved b;'' both Govern- 
raent rnd industry.'- in development of code lav pnd its application, and 
elimina.tion of overlapjiing definitions in industr;>:- codes. 



9808 



►-77- 

5. Si^nplicity of line-up for nore accurate statistics on 
industries aiid trades. 

Tlie eventual e:cpectation is that the £2 sections ^^ill fit 
into 10 01- 11 industrjr divisions. Already, within the last ferr days, 
t'.70 ne--' divisions have "been created in line "ith the plan. 

The first, coverin.'^ Putlic Utilities, Transportation and 
Cormunication, is viider Lei{:;hton I'. Peel)les, Actinr; Divisional Adminis- 
trator. An'other probably rill include all Textile Producinj and 
Clothing codes and the Leather and 3\xr codes. 

Chief diver;?;ence frora the census and. international classifi- 
cation is the total elinination of "'■'.iscellaneous" groiLpings. USA stu- 
dents of the problem be;'^rii ' ith the assu:n-otion that there ^as a proper 
statistical md. adj.iinistrative place for ever;;-- single industrial unit, 
and ^■'ith the kno^'ledi;e that .ac'T-iini strati on of "niscellaneous" units 
would present an unassinilable hodge-podge of unrelated problens. The 
classification also depa/rts fron the indefinite terns such as "capital 
goods," rhich have heretofore caused confusion in statistical rrorh 
"by their vagueness. 

Such industries as have temporarily adopted USA's Basic Code 
all have aji assigned place in the 22 sections to rhich they 'nay go rhen 
they are ready to assvjne full self-governing functions. 

The classification \'as based on recognition of four basic groups 
of entei'^-irise: 

1. Production of basic Liateriais fron the soil. 

2. Fabrication of rhat er.ierges from the first group into finished 
products. 

3. Service - -industries rrhich do not produce or fabricate defi- 
nite products but uhich render service - -ranging from transportation 
through finraice to ariuseiaents, professions and such service trades as 
laun.d.ries, restaurrnts, etc. 

4. Distribution of goods, -..'holesale and retail. 

Tlie 22 sections and the fundanental grouji to \ rhich they belong are 
as folloT^s: 

Prod-ucing Industries 

1. Food 

2. Textiles 

3. Leather and Fur 

4. Ferrous hetals 

5. ilon-Ferrous hetals 

6. lion hetallic Products 



S808 



-78- 



7. 


Pasl 


3. 


Lunter 8J.id Tin'oor 


9. 


Chemical s, Paints 


10. 


Paper 


11. 


Poi'b'ber 


Pa^bricatin^; 


Industries 




Equipment 


lo. 


Lanuf ac turin^ 


14. 


Graphic Arts 


15. 


Construction 


Service Industries 



ail'". Drugr 



16. Public Utilities 

17. Transportation 

18. Connunication 

19 . Pinance 

20. Amuseuents 



Distributin.'T Trades 



as follows: 



21. Professions and Services 

22. Uliolesale and ::ietail Trades 



The protahle u2ti-;ate line-up of iiidu'^trj'- divisions is 



c 

10 



Food, faiTi products. 

Tentile, Purs, Leather. 

Sasic naterir.ls, steel, luiaher, huilding naterials, 

fuels. 

Cheiiicals, di-'a^s, paints, paper, ruboer. 

Equipncnt, -lacliinery, tools, fictures, vehicles. 

Laiiufacturin."; of use ^;oods — fro:.! household appliances 

to musical instruments. 

Constru-ction in all branches . 

Public utilities (electric, i;^as, '.-'ator), transportation, 

corirronication. 

Finance, graphic arts, anusenents. 

Professional, service trades: all ^'holesale and retail 

codes (except food). 



Because of the relationshi^T betreen food codes and the Agri- 
cultural Ad justkicnt Administration pro^rreis, n"iimber one division is 
vertical from first manufactxire throufjh retail srle. Coordinating machin- 
ery, ho',7ever, uill be established for ■mniform trade policies between 
divisions one and ten, ?nd if later fovjid desirable the food distribution 
codes are arranged so that the;'- can be readily grouped ^/ith other dis- 
tributing trade groups. 

The entire f:tro.cture thus created is regarded as sufficiently 
ration,alized for both Government and Industry 'ourooses at this time, 



9 BOG 



"79- 

but it is not flexible and several divisions, nhich adjoin in the 
classification, na^ if advisable later be transferred without dis- 
location to the \7h0le i^lan. 

f 
It is HOT pro^iosed by III1A that industries consolidate 
their codes into the 22 ;iaster classification, nor is it intended 
that any direct linl: or liaison nithin industrial channels be erected 
to dran then together, but the '.iioj.e plan, is based on natural defini- 
tions of industries aaid trades as T/Titten by the industrjr and-trade 
groujj there-onder. 

The code mergers uhich are e:qDected to result eventually 
will talce place between units of a].raost identical econoraic interest 
whose sepa,ration at this time is based on arbitrary and personal 
rather than eccronic reasons. A tentative objective has been an over- 
all total of about 250 pacts instead of the present 682. 

Trade associations will be encouraged to retain their 
separate identities even when the code group is merged. At present 
sone codes actually erabrace as nany as thirty separate trade associations, 
each collecting statistics and carrj^ing on technical work under the 
general supervision of the master pode gro"ap. 

To ma2-:e possible the transfer now ordered, vdthout intei^ 
ruption of administration, the codes v,'ere gone over one by one; the 
definitions of each were studied; the deputies in charge were consulted; 
the code authorities of nany were called in. As a result every con- 
pleted or pending code was noved individually to a definite and 
acceptable nlace. 

It is expected that industries will move towa.rds code 
mergers as thej^ gain administrative experience, both to bring themselves 
into better coordination with kindred groujDS and to reduce the unit 
cost of adininistration. 

Studies of code exroense to industry now are being made both 
in NHA and outside to reach the minimum consistent with effective admin- 
istration. Preliminary indications are that there is room for ;very 
marked overhead reduction, and the e^qperience of the Administration in 
watching the operation of codes indicated that narked savings to in- 
dustry will result in the groupings of smaller industries into larger 
administrative uiiits. 

Until the present classification was undertaken, the codes 
had been assi;gned partly by relationship to one another, but especially 
to fit the special abilities of division administrators. This basis 
for assignment v/as essential in the early rush days of ITEA. 



9808# 



I 



OFFICE OF THE NATIONAL RECOVERY ADMINISTRATION 
THE DIVISION OF REVIEW 

THE WORK OF THE DIVISION OF REVIEW 

Executive Order No. 7075, dated June 15, 1955, established the Division of Review of the 
National Recovery Administration. The pertinent part of the Executive Order reads thus: 

The Division of Review shall assemble, analyze, and report upon the statistical 
information and records of experience of the operations of the various trades and 
industries heretofore subject to codes of fair competition, shall study the ef- 
fects of such codes upon trade, industrial and labor conditions in general, and 
other related matters, shall make available for the protection and promotion of 
the public interest an adequate review of the effects of the Administration of 
Title I of the National Industrial Recovery Act, and the principles and policies 
put into effect thereunder, and shall otherwise aid the President in carrying out 
his functions under the said Title. I hereby appoint Leon C. Marshall, Director of 
the Division of Review. 

The study sections set up in the Division of Review covered these areas: industry 
studies, foreign trade studies, labor studies, trade practjce studies, statistical studies, 
legal studies, administration studies, miscellaneous studies, and the writing of code his- 
tories. The materials which Arere produced by these sections are indicated below. 

Except for the Code Histories, all items mentioned below are scheduled to be in mimeo- 
graphed form by April 1, 1936. 

THE CODE HISTORIES 

The Code Histories are documented accounts of the formation and administration of the 
codes. They contain the definition of the industry and the principal products thereof; the 
classes of members in the industry; the history of code formation including an account of the 
sponsoring organizations, the conferences, negotiations and hearings which were held, and 
the activities in connection with obtaining approval of the code; the history of the ad- 
ministration of the code, covering the organization and operation of the code authority, 
the difficulties encountered in administration, the extent of compliance or non-compliance, 
and the general success or lack of success of the code; and an analysis of the operation of 
code provisions dealing with wages, hours, trade practices, and other provisions. These 
and other matters are canvassed not only in terms of the materials to be found in the files, 
out also in terms of the experiences of the deputies and others concerned with code formation 
and administration. 

The Code Histories, (including histories of certain NRA units or agencies) are not 
mimeographed. They are to be turned over to the Department of Commerce in typewritten form. 
All told, approximately eight hundred and fifty (850) histories will be completed. This 
number includes all of the approved codes and some of the unapproved codes. (In W ork 
Material s No 18, Content s of Code Histries . will be found the outline which governed 
the preparation of Code Histories.) 

(In the case of all approved codes and also in the case of some codes not carried to 
final approval, there are in NRA files further materials on industries. Particularly worthy 
of mention are the Volumes I, II and III which constitute the material officially submitted 
to the President in support of the recommendation for approval of each code. These volumes 
9768—1. 



-ii- 

set forth the origination of the code, the sponsoring group, the evidence advanced to sup- 
port the proposal, the report of the Division of Research and Planning on the industry, the 
recommendations of the various Advisory Boards, certain types of official correspondence, 
the transcript of the formal hearing, and other pertinent matter. There is also much offi- 
cial inforuation relating to amendments, interpretations, exemptions, and other rulings. The 
materials mentioned in this paragraph were of course not a part of the work of the Division 
Of Review. ) 

THE WORK MATERIALS SERIES 

In the work of the Division of Review a considerable number of studies and compilations 
of data (other than those noted below in the Evidence Studies Series and the Statistical 
Material Series) have been made. These are listed below, grouped according to the char- 
acter of the material. (In Work M aterials No. 17, Tentative O utlines and Summaries of 
Studies in Process , these materials are fully described). 

I ndustry Studies 

Automobile Industry, An Economic Survey of 

Bituminous Coal Industry under Free Competition and Code Regulation, Economic Survey of 

Electrical Manufacturing Industry, The 

Fertilizer Industry, The 

Fishery Industry and the Fishery Codes 

Fishermen and Fishing Craft, Earnings of 

Foreign Trade under the National Industrial Recovery Act 

Part A - Competitive Position of the United States in International Trade 1927-29 through 

1934. 
Part B - Section 3 (e) of NIRA and its administration. 
Part C - Imports and Importing under NRA Codes. 
Part D - Exports and Exporting under NRA Codes. 

Forest Products Industries, Foreign Trade Study of the 

Iron and Steel Industry, The 

Knitting Industries, The 

Leather and Shoe Industries, The 

Lumber and Timber Products Industry, Economic Problems of the 

Men's Clothing Industry, The 

Millinery Industry, The 

Motion Picture Industry, The 

Migration of Industry, The: The Shift of Twenty-Five Needle Trades From New York State, 
1926 to 1934 

National Labor Income by Months, 1929-35 

Paper Industry, The 

Production, Prices, Employment and Payrolls in Industry, Agriculture and Railv;ay Trans- 
portation, January 1923, to date 

Retail Trades Study, The 

Rubber Industry Study, The 

Textile Industry in the United Kingdom, France, Germany, Italy, and Japan 

Textile Yarns and Fabrics 

Tobacco Industry, The 

Wholesale Trades Study, The 

Women's Neckwear and Scprf Industry, Financial and Labor Data on 

9768—2 



.. .-ff.; 



- Ill - 

Women's Apparel Industry, Some Aspects of the 

T rade Practic e Stu dies 

Commodities, Infonnation Concerning: A Study of NRA and Related Experiences in Control 
Distribution, Manufacturers' Control of: Trade Practice Provisions in Selected NRA Codes 
Distributive Relations in the Asbestos Industry 
Design Piracy: The Prob]em and Its Treatment Under NRA Codes 
Electrical Mfg. Industry: Price Filing Study 
Fertilizer Industry: Price Filing Study 

Geographical Price Relations Under Codes of Fair Competition, Control of 
Minimum Price Regulation Under Codes of Fair Competition 
Multiple Basing Point System in the Lime Industry: Operation of the 
Price Control in the Coffee Industry 
Price Filing Under NRA Codes 
Production Control in the Ice Industry 
Production Control, Case Studies in 

Resale Price Maintenance Legislation in the United States 

Retail Price Cutting, Restriction of, with special Emphasis on The Drug Industry. 
Trade Practice Rules of The Federal Trade Commission (1914-1936): A classification for 
comparison with Trade Practice Provisions of NRA Codes. 

Labor Studies 

Cap and Cloth Hat Industry, Commission Report on Wage Differentials in 

Earnings in Selected Manufacturing Industries, by States, 1933-35 

Employment, Payrolls, Hours, and Wages in 115 Selected Code Industries 1933-35 

Fur Manufacturing, Commission Report on Wages and Hours in 

Hours and Wages in American Industry 

Labor Program Under the National Industrial Recovery Act, The 

Part A. Introduction 

Part B. Control of Hours and Reemployment 

Part C. Control of Wages 

Part D. Control of Other Conditions of Employment 

Part E. Section 7(a) of the Recovery Act 
Materials in the Field of Industrial Relations 
PRA Census of Employment, June, October, 1933 
Puerto Rico Needlework, Homeworkers Survey 

A dministrative Studies 

Administrative and Legal Aspects of Stays, Exemptions and Exceptions, Code Amendments, Con- 
ditional Orders of Approval 
Administrative Interpretations of NRA Codes 
Administrative Law and Procedure under the NIRA 
Agreements Under Sections 4(a) and 7(b) of the NIRA 
Approve Codes in Industry Groups, Classification of 
Basic Code, the — (Administrative Order X-61) 
Code Authorities and Their Part in the Administration of the NIRA 

Part A. Introduction 

Part B. Nature, Composition and Organization of Code Authorities 
9768—2. 



Part C. Activities of the Code Authorities 

Part D. Code Authority Finances 

Part E. Summary and Evaluation 
Cede Compliance Activities of the NRA 
Code Making Program of the NRA in the Territories, The 
Code Provisions and Related Subjects, Policy Statements Concerning 
Content of NIRA Administrative Legislation 

Part A. Executive and Administrative Orders 

Part B. Labor Provisions in the Codes 

Part C. Trade Practice Provisions in the Codes 

Part D. Administrative Provisions in the Codes 

Part E. Agreements under Sections 4(a) and 7(b) 

Part F. A Type Case: The Cotton Textile Code 
Lab3ls Under NRA, A Study of 

Model Code and Model Provisions tor Codes, Development of 

National Recovery Administration, The: A Review of its Organization and Activities 
NRA Insignia 

President's Reemployment Agreement, The 

President's Reemployment Agreement, Substitutions in Connection with the 
Prison Labor Problem under NRA and the Prison Compact, The 
Problems of Administration in the Overlapping of Code Definitions of Industries and Trades, 

Multiple Code Coverage, Classifying Individual Members of Industries and Trades 
Relationship of NRA to Government Contracts and Contracts Involving the Use of Government 

Funds 
Relationship of NRA with States and Municipalities 
Sheltered Workshops Under NRA 
Uncodified Industries: A Study of Factors Limiting the Code Making Program 

Legal Studies 

Anti-Trust Laws and Unfair Competition 

Collective Bargaining Agreements, the Right of Individual Employees to Enforce 

Commerce Clause, Federal Regulation of the Employer-Employee Relationship Under the 

Delegation of Power, Certain Phases of the Principle of, with Reference to Federal Industrial 
Regulatory Legislation 

Enforcement, Extra-Judicial Methods of 

Federal Regulation through the Joint Employment of the Power of Taxation and the Spending 
Power 

Government Contract Provisions as a Means ;f Establishing Proper Economic Standards, Legal 
Memorandum on Possibility of 

Industrial Relations in Australia, Regulation of 

Intrastate Activities Which so Affect Interstate Commerce as to Bring them Under the Com- 
merce Clause, Cases on 

Legislative Possibilities of the State Constitutions 

Post Office and Post Road Power ~ Can it be Used as a Means of Federal Industrial Regula- 
tion? 

State Recovery Legislation in Aid of Federal Recovery Legislation History and Analysis 

Tariff Rates to Secure Proper Standards of Wages and Hours, the Possibility of Variation in 

Trade Practices and the Anti-Trust Laws 

Treaty Making Power of the United States 

War Power, Can it be Used as a Means of Federal Regulation of Child Labor? 

97 68—4, 



- V - 

THE E VIDE NCE STUDIES SERIE S 

The Evidence Studies were originally undertaken to gather material for pending court 
cases. After the Schechter decision the project was continued in order to assemble data for 
use in connection with the studies of the Division of Review. The data are particularly 
concerned with the nature, size and operations of the industry; and with the relation of the 
industry to interstate commerce. The industries covered by the Evidence Studies account for 
more than one-half of the total number of workers under codes. The list of those studies 
follows: 



Automobile Manufacturing Industry 
Automotive Parts and Equipment Industry 
Bakirg Industry 

Boot and Shoe Manufacturing Industry 
Bottled Soft Drink Industry 
Builders' Supplies Industry 
Canning Industry 
Chemical Manufacturing Industry 
Cigar Manufacturing Industry 
Coat ci.nd Suit Induptiy 
Construction Industry 
Cotton Garment Industry 
Drees Manufacturing Industry 
Electrical Contracting Industry 
Slect-ical Manufacturing Industry 
Fabricated Metal Products Mfg. and Metal Fin- 
ishing and Metal Coating Industry 
Fishery Industry 

Turniture Manufacturing Industry 
General Contractors Industry 
Graphic Arts Industry 
Gray Iron Foundry Industry 
Hosiery Industry 

Infant's and Children's Wear Industry 
Iron and Steel Industry 



Leather Industry 

Lumber and Timber Products Industry 
Mason Contractors Industry 
Men's Clothing Industry 
Motion Picture Industry 
Motor Vehicle Retailing Trade 
Needlework Industry of Puerto Rico 
Painting and Paperhanging Industry 
Photo Engraving Industry 
Plumbing Contracting Industry 
Retail Lumber Industry 
Retail Trade Industry 
Retail Tire and Battery Trade Industry 
Rubber Manufacturing Industry 
Rubber Tire Manufacturing Industry 
Shipbuilding Industry 
Silk Textile Industry 
Structural Clay Products Industry 
Throwing Industry 
Trucking Industry 
Waste Materials Industry 
Wholesale and Retail Food Industry 
Wholesale Fresh Fruit and Vegetable Indus- 
try 
Wool Textile Industry 



THE STATISTICAL MATERIALS SERIES 



This series is supplementary to the Evidence Studies Series. The reports include data 
en establishments, firms, employment. Payrolls, wages, hours, production capacities, ship- 
ments, sales, consumption, stocks, prices, material costs, failures, exports and imports. 
They also include notes on the principal qualifications that should be observed in using the 
data, the technical methods employed, and the applicability of the material to the study of 
the industries concerned. The following numbers appear in the series; 
9768—5. 



.,i 



- vi - 

Asphalt Shingle and Roofing Industry Fertilizer Industry 

Business Furniture Funeral Supply Industry 

Candy Manufacturing Industry Glass Container Industry 

Carpet and Rug Industry Ice Manufacturing Industry 

Cement Industry Knitted Outerwear Indvstry 

Cleaning and Dyeing Trade Paint, Varnish, and Lacquer, Mfg. Industry 

Coffee Industry Plumbing Fixtures Industry 

Copper and Brass Mill Products Industry Rayon and Synthetic Yarn Producing Industry 

Cotton Textile Industry Salt Producing Industry 

Electrical Manufacturing Industry 

THE COVERAGE 

The original, and approved, plan of the Division of Review contemplated resources suf- 
ficient (a) to prepare some 1200 histories of codes and NRA units or agencies, (b) to con- 
solidate and index the NRA files containing some 40,000,000 pieces, (c) to engage in ex- 
tensive field work, (d) to secure much aid from established statistical agencies of govern- 
ment, (e) to assemble a considerable number of experts in various fields, (f) to conduct 
approximately 25% more studies than are listed abo-ve, and (g) to prepare a comprehensive 
summary report. 

Because of reductions made in personnel and in use of outside experts, limitation of 
access to field work and research agencies, and lack of jurisdiction over files, the pro- 
jected plan was necessarily curtailed. The most serious curtailments were the omission of 
the comprehensive summary report; the dropping of certain studies and the reduction in the 
coverage of other studies; and the abandonment of the consolidation and indexing of the 
files. Fortunately, there is reason to hope that the files may yet be cared for under other 
auspices. 

Notwithstanding these limitations, if the files are ultimately consolidated and in- 
dexed the exploration of the NRA materials will have been sufficient to make them accessible 
and highly useful. They constitute the largest and richest single body of information 
concerning the problems and operations of industry ever assembled in any nation. 

L. C. Marshall, 
Director, Division of Review. 
9768—6 . 



\:-::£; 



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