■ilgii^ . ^
OFFICE OF NATIONAL RECOVERY ADMINISTRATION
DIVISION OF REVIEW
THE MEN'S CLOTHING INDUSTRY
By
J.W. Hathcock
Assisted By
A. Palma Aaronson Geraldine Asmuth
C.C. Boyden A. A. Fisher
Walter E. Woodford, Jr.
WORK MATERIALS NO. 58
INDUSTRY STUDIES SECTION
March, 1936
OFFICE OF NATIONAL IffiCOVERY ADMINISTRATION
DIVISIOH OF RE7IEI7
THE I EN'S CLOTHING INDUSTRY
3y
J. 7J. Hath cock
Assisted By
A. Palma Aaronson Geraldine Asrauth
C. C. Boyden A. A. Fisher
¥alter E. Yloodford, Jr.
INDUSTRY STUDIES SECTION
March, 1935
9782
? OEE| OHD
This Study of the Men's Clothing Industry was prepared by Mr. J. W.
Hathcock of the Industry Studies Section, Mr e Ma D. Vincent in charge.
The study as originally planned \?rs much broader in scope than
the finished product. The field of study was narrowed particularly
because of limitations in personnel and tine, A more detailed explana-
tion of the circumstances shaping the charrcter of the study is found
in Appendix A, along with suggestions for further study.
While the study of the Men's Clothing Industry gives considerable
attention the a statistical and general description of the outstanding
characteristics of the industry, the major part of the study is given
to the outlining of the industry's -oroblems and the attempt imder the
code to correct these maladjustment s The principal problems given at-
tention are those arising from decline in value of the industry's pro-
duct, narrow profit margins, instability of employment, wages and hours,
and home work.
A review of KRA and other governmental files indicates, as shown
by the study, that considerable progress was made toward the solution
of many of the industry's -oroblems during the ERA ~->eriod,. It is like-
wise revealed that significant administrative problems arose under the
code, particularly as regards the overlapping of codal definitions and
the application of the wape provisions providing for the maintenance
of wage standards above the ninimumc
Most of the statistical material in this study was prepared in
cooperating with the Industry Statistics Unit, Statistics Section of
the Division of Review. A number of the statistical tables, however,
were prepared either within the study group or were obtained from other
sources and have not been checked by the Industry Statistics Unit.
At the back of this report will be found a brief statement of the
studies undertaken by the Division cf Review.
L. C. Marshall
Director, Division of Review.
March 10, 1936.
9782 -i-
THE MSK : S CLOTHING INDUSTRY
TJ^LF OF COICT^K TS
Page
SUMMARY 1
CHAPTER I— DEFINITION AND SCOPE OF INDUSTRY 16
I. Code Definition and Jurisdictional Disputes 16
A. The Cotton Garment Industry 17
1. The Codes as Originally Approved 18
2. Amendments of December 18, 1933 19
(a) Men' s Clothing Cede 20
(b) Cotton Garment Coae 20
3. The Inter- Code Committee 20
4. Amendment to the Cotton Garment Code —
March 15, 1334 21
(a) Report of the Special Administrator 21
5. Amendment to the Cotton Garment Code —
August 21 , 1S34 21
6. Developments from December 1, 1934, to
Supreme Court Decision bay £7, 1935 < . .
B. Merchant and Custom Tailoring Industry „ 24
C. Textile Examining, Shrinking, and Refinish-
ing Industry ..=..,.. 26
D. Shoulder Pad Manufacturing Industry and
Slit Faerie Manufacturing Industry 27
E. Coat Front Manufact ;ring Industry 27
F. Infants ' and Children 1 s Wear Industry 28
G. Knitted Cut err/ear Industry 28
E. Rainwear Division of the Rubber Industry 30
I. Army and Navy Clothing Factories 30
J. International Clothing Designers 31
II. Relationship with Other Industrial and Trade
Groups 31
A. Piece Goods Division, Wool Textile Manu-
facturing Indus try 31
B. Retail and Wholesale Trade 32
III. Brief Historical Sketch of Development of Men's
Ready-Made Clothing Industry 32
A. Ready-Made Garments 32
B. Development of the Factory System 33
C. Civil War Stimulus to Factory System 34
IV. Present Day Scope of Men's Clothing Industry 34
A. Number of Establishments 34
B. Distribution of Establishments 35
C. Garments Cut, by Principal States 37
D. Wage Earners in the Industry 37
E. Value and Volume of Production 37
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Page
CHAPTER I I—CHARACTERISTICS OF THE INDUSTRY 47
I. Organization of Production * 47
A. Types of Establishments 47
1 . The Manufacturer-Distributor 47
2. The "Integrated" Manufacturer 48
3. The Tailor-to- the-Trade Establishment 48
B. Technology 48
1. Machinery 49
II . Financial Aspects of the Industry 51
A. Investment in Industry 51
B. Mortality 51
C. Capital and Turnover 54
1. Contractor' a Investment 54
2. Manufacturer-Wholesaler' s Investment
Turnover 54
3. Relationship of Sales Volume to Invested
Capital 55
4. Price Range in Relation to Turnover 57
D. Financing 62
1. Sources of Capital 62
2. Sources of Credit — Merchandise Suppliers
and Banks 62
3. Terms Granted by Mills 62
(a) Effect of Selling Policy of Mills 64
4. Governmental Aid 64
5. Selling Terms 66
(a) Seasonal Activity Changes 66
(b) Working Capital 66
E. Labor Costs 67
III. Raw and Semi-Processed Materials 68
A. Cost of Materials 68
B. Source of Materials 73
C. Ratio of Materials' Cost to Value of Products 73
IV, Employment 73
A. Stability of Employment 77
V. Wages and Hours 79
A. Average Wages per Hour 79
B. Average Weekly Wages 79
C. Payrolls 79
D. Distribution of Payrolls by States 80
E. Distribution of Employment, Man Hours, and
Earnings , by Marke b Areas 80
F. Wage Earners Classified According to
Average Hourly Wage Paid to All Employees in
Establishments, for the Industry, and for
Market Areas 85
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Page
G. Average Annual Uages in Men's Clothing
Compared with All Other Manufacturing Industries 90
H. Comparison of Changes in Average Weekly Wages
and in Cost of Living * . 90
VI. Prices: Rar; Materials and Finished Products 90
VII. Exports and Imports 93
VIII. Migration in the Men' s Clothing Industry 97
IX. Ratio of Labor Cost to Value of Product 97
X. Labor Relations 104
XI. Description of Distribution Channels 107
A. TJholesalers and Jobbers 107
B. Retailers H°
1. Department Stores 110
(a) Direct to Consumer Ill
2. Mail Order Houses 112
C. Resident Buyers 114
1. Attitude of Manufacturers 118
XII. Material and Garment Standards in the Men's
Clothing Industry 120
A. Measurements 120
3. Fibre Contents 122
C. Shrinkage 126
D. Color-Fastness 131
E. Labeling 131
CHAPTER III—PRE-CODE PROBLEMS OF THE INDUSTRY AND
URITING OF TIE CODS 133
I . Pre-Code Problems of the Industry 133
A. Decline in Value of Industry Product 133
B. Productive Capacity of Industry 133
C. Employment and Hours 133
D. Wages 134
E. Extent of Unionisation 135
P. Home Uork 135
G. Profit Margins 136
II. Writing of the Code 139
A. Problems of the Industry Hot Covered by
the Coae 144
1. Trade Practices 144
2. Apprentices 144
3. Differences in Industrial Technique 145
CHAPTER IV--C0DS ADMINISTRATION— ORGANIZATION AND
PROCEDURE 146
I . Membership of Code Authority 146
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A. Formal Recognition and Establishment of Code
Authority 148
1. Peccgnition of Laoor Members 149
2. Recognition of Industry Members 149
3. Proposed Consumer i.enresentation on Cods
Authority 153
B. Code Authority Officials and General
Organization 154
II. Compliance Frocedure 156
A. Industrial Adjustment Agency Contemplated 160
III . Use of Labels 161
A. Label Publicity 165
B. Label Compliance 166
C. Labels for Uniform Manufacturers 166
D. Retailers' Labels 168
E. Reduced Price of Laoels for Children 1 s Suits 168
F. Proposed Reduction of Label Charge for Single
P?nts 169
IV. The Budget 169
A. Summary of Financial Reports Covering the
Budget ~ 176
3. Cost of Code Authority to the Industry 180
V. Interpretations and Interpretation Procedure 181
A. Interpretations Submitted for Administrative
Approval 182
B. Interpretation Publicity 188
C. Administrative Orders Approving Interpretations 189
D. Suggested Interoretc.ticns Hot Approved by
idninistration 195
E. Classifications 198
VI. Collection and Use of Statistics 199
VII. Procedure Authorized but Hot Effected 200
CHAPTER V— LABOR UNDER THE COLE 201
I. Hour Provicions — Issues in TJriting 201
II. Special Provisions for Overtime 202
A. Overtime for Tailors-to-the-Trade 202
B. Overtime for Uniform Manufacturers 204
C. Right of Code Authority to Determine Over-
Time period 205
III. Exemptions and Denials of Exormtions 206
A. Exemptions from Hour provisions Granted Small
Groups and Individual Firms 208
B. Denial cf Requested Exemptions from Hour
Provisions 211
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Page
IV. Wage Provisions and Issues in Writing 213
A. Proposed Amendments of Wage Provisions 215
B. Arguments Favoring proponed Classified
Wage Scales 222
C. Advisers' Recommendations on Proposed
Change in Wage Provisions 230
D. Additional Arguments Opposing Proposed
Classified Wage Scales 231
V. Apprentices 235
VI. Home Workers and Handicapped Workers 236
VII. Exempt ions from Wage Provisions 239
VIII. Compliance 239
A. ~ The Greif Case 244
B. The Pincinnati Cases 247
IX. Employment and Wages under the Code 254
CHAPTER VI— TRADE PRACTICES 256
I. Codal Trade Practice Provisions 256
II. Consignment Selling . , 257
A. The Case of S. Makransky and Sons, Inc 259
B. Cases cf Eickey-lreeman Co., New York,
and Cohen-Goldman Co c , Hew Tori: 259
C. Case oi iloritz and Winter Company 260
D. Case of Levy Brothers and Adler Rochester 260
E. Complaints Arising from Consignment
Exemptions 260
III. Cut , Make , and Trim 261
A. Proposed Amendment to Cut, Make, and Trim
Provision . „ 263
B. The Sears-Roehuck Exsraption Case 266
C. Proposed Interpretation of Cut, Make, and
Trim provision 266
IV. The Cost Formula 267
A. Uniform Accounts 270
V. Compliance with Trade Practice Provisions 270
VI. Dropped Lines or Surplus Stocks 271
VII. Proposed Amendments to Fair Trade Practice
Provisions 272
A. Lair Trade Practices under Consideration "by
Commi btee on Fa.ir Trade Practices 272
B. The Trade Fractice Hearing ''10~I» , 274
1. The Executive Director' s Statement 274
C. Trade Practice Amendments Scheduled for
Hearing 275
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Page
1. Retailers' Objections to Proposed Trade
Practice Amendments 277
D. Proposed Trade Practices Submitted by Tailors-
to-the-Trade and Eetailers ' Objections 279
VIII. Proposed Fair Trade Frau^ices for Uniform
Manufacturers 282
X. Fair Trade Fractices for Uniform Manufacturers
Approved by Feaeral Trade Commission 291
Appendix A. "Methodolo^" — Explanation of Scope of
Study and Suggestions for 'Further Study 299-314
Appendix B. List of Division Administrators, Deptity
Administrators, Assistant Feputy Admin-
istrators, and Aides TTao Served in Con-
nection with the hen'- s Clothing Code 315
Appendix C. Production of "en's Clothing under the
Cotton Garment Coce — ine Overlap Problem 316-473
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TABLES
Table I. Number of Establishments in the Ken's tigg.
Clothing Industry: Regular Factories
and Contract Shops 35
Table II. Number and Per Cent of Productive Units
in Specified States 36
Table III. Percentage of Total Garments Cut, by
Principal States, 19S4 45
Table IV. Number of Wage Earners in the Hen's Cloth-
ing Industry Coiroared with that in all
Other Manufacturing Industries, 1923-1933 46
Tables V - X Establishments, Wage Earners, Wages, Cost
of Materials, Value of Products and Value
Added, "oy States, 1S23-1933 38-43
Table XI. Principal Products, by Class and Value,
1923 and 1925, and by Class, Quantity
and Value , 1927-1934 44
Table XII. Number of Business Embarrassments and
Amount of Liabilities in "Embarrassments 53
Table XIII. Net Worth and Net Sales of an Average
Clothing : Ianufacturer 58
Table XIV. per Cent Increase or Decrease over 1932
in the Net Worth and Net Sales of an
Average Clothing Manufacturer 59
Table XV. Net Return on Investment and Per Cent
Profit or Loss on Sales of An Average
Clothing Manufacturer 60
Table XVI. Operating Costs in the lien's Clothing
Industry, according to Net Worth of
Manufacturer 61
Table XVII. Operating Costs in the lien's Clothing
Industry, According to Price Range of
Manufacturer 63
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Table XVIII.
Table XIX.
Tables 1 '.XX.-
XXII,
Table XXIII.
Table XXIV.
Table XXV.
Table XXVI.
Table XXVII.
Table XXVIII.
Table XXIX.
Table XXX.
Table XXXI.
Table XXXII.
Table XXXIII.
Table XXXIV.
Reconstruction Finance Corooration Loans
Authorized to lien's Clothing Manufactur-
ers and Others 65
Operating Costs in the "'en's Clothing
Industry, According to Profitable end
Unprofitable Manufacturing 69
Production of Principal Materials Used,
by Kind and State, 1929 and 1931, rnd
by Kind, 1933 70-72
Ratio of Labor Cost, and of Materials'
Cost to Total Value of Product 74
Factory Employment , 1926-1935 75
Index of Employment, 1933 and 1934 77
lluraber of Wage Earners, High and Lou
Months and Yearly Average, 1923-1935 78
Factory Wages, 1926-1935 81
Factory Payrolls, 1926-1955 82
Average Number of Wage Earners and Total
Annual Wages b- Principal States, 1929-
1934 83
Employment, Han-'Hours and Earnings, by
Market Areas, Last Six Months, 1934 84
Factor- Hours, 1926-1935 86
Frequency Table Showing Distribution of
1,471 Establishments Classified Accord-
ing to the Average Hourly Wage Paid to
All Employees in Establishments 87
Frequency Table Showing Distribution by
Market Areas According to Average Hourly
Wage Paid to All Employees (Excluding
Office) ". 88
Average Annual Wage in the Men's Cloth-
ing Indus try Compared with that in All
Other Manufacturing Industries, 1923-1933 89
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Ta"ble XXXV.
Table XXXVI.
Table XXXVII.
Table XXXVIII.
Table XXXIX.
Table
XL.
Table XLI.
Table XLI I.
Table XLIII.
Table XLIV.
Table XLV.
Table XLV I ,
Comparison of Changes in Average Weekly
Wages in the Men's Clotning Industry
and in the Cost of Living, 1923-1934 91
T.holeoale Frices — Ran Materials, 1926-
1935 92
Wholesale Prices (index of Composite
Wholesale Prices) 1935-1935 94
Retail Prices ( Index) 1930-1935 95
bearing Apparel Exports, Quantities,
Values, and Index of Quantities 96
Clothing and Articles of Fearing Apparel,
Wool., (Except Wool-Pelt Hats and Hat
Bodies), :T ot Knit or Crocheted: Imports
for Corsuption into the United States
from Principal Sources 98
Establishments for the United States,
the Five Major Cities, and Outside the
Five Major Cities, by Census Years,
1923-1929 99
Wage Earners for the United States, the
Five Major Cities, and Outside the Pive
Major Cities, by Census Years, 1923-1929 100
Wages for the United States, the Pive
Major Cities, and Outside the Pive Major
Cities, by Census Years, 1923-1929 101
Value of Products for the United States,
the Pive Major Cities, and Outside the
Pive Major Cities, by Census Years, 1923-
1929 102
Cost of Materials for the United States,
the Pive Major Cities, and Outside the
Five Major Cities, by Census Years, 1923-
1929 103
Net Profit or Loss after All Charges, of
3 Large Chicago Manufacturers 140
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•Table XLVII.
Table XLVIII.
Table XLIX.
Number and Value of Labels Sold by lien's
Clothing Code Authority
Number of Handicap-oed "Torkers Certifi-
cates Issued, Refused, Revoked, and Can-
celled, to and including May 27, 1935,
According to State
Special Certificates of Exceptions to
Homework Prohibitions of the Codes
179
237
238
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TH£ MEN'S CLOTHING INDUSTRY
SUMMARY
DEFINITION AND SCOPE OF INDUSTRY
The definition of the Men's Clothing Industry confined code
activity to men's outer garments, principally those made of wool or
part wool. Certain cotton garments, such as linen and cotton wash
garments (summer wear) ordinarily made in establishments devoted
solely to men's outerwear are included also under the Men's Clothing
Code.
The definition for the men's clothing industry was in conflict
t with several proposed and accepted codal definitions for other in-
dustries. Among the industries having codal defintions or suggested
codal definitions in conflict with the definition of the Men's
Clothing Industry are the Cotton Garment Industry, the Merchant and
Custom Tailoring Industry, the Rainwear Division of the Rubber
Manufacturing Industry, the Textile Examining, Shrinking, and Re-
finishing Industry, the Shoulder Pad Manufacturing Industry, the
Slit Fabric Manufacturing Industry, the Coat Front Manufacturing
Industry, the Infants' and Children's 7/ear Industry, the Knitted
Outerwear Industry, and tailoring shops operating under the author-
ity of the United States Government.
The jurisdictional conflict with the Cotton Garment Industry
was of major consequence and was never settled to the satisfaction
of the industries concerned. (This conflict is covered under
Appendix C.) With respect to the other industry groups in conflict
with the Men's Clothing Industry Code, in certain instances definitions
were modified or so drawn as to minimize the possibility of serious
jurisdictional disputes, yet there remained, the feeling that many of
these grou >s might well have been included under the Fen' s Clothing
Industry Cede.
The Men's Clothing Industry found some difficulty in adjusting
itself to new trade practices brought about by the Code for the Piece
Goods Division of the Wool Textile Manufacturing Industry. The new
practices related principally to methods of quotation on a semi-rigid
discount basis, and f.o.b. shipments. Cn the selling side, the Men's
Clothing Industry was unable to obtain complete cooperation of the
"Retail and Fnolesale Trade" in respect to proposed fair trade practices
relating to discounts, deliveries, etc.
During the Colonial period of American history, most clothing was
made a home or was bought as second-hand clothing from dealers in old
clothing. Finally the ready-made clothing industry developed from
the custom tailoring shops which began to nroduce for stock in order
to keep employees busy. Increase in travel and the stimulus to home
industry by a tariff placed upon the importation of cloth in 1832,
9782
encouraged the growth of the Industry. 3?y 1850, the ready-made cloth-
ing industry had become import "ait, as is evidenced "by a product valued
at $48,311,000. The present-day factory of the ready-made clothing
industry did not develop until the invention and -perfection of the
sewing machine around the micdle of the 19th century.
During the spring of 1935, the Men's Clothing Industry had 3,225
estabiisnments, including both regular, factories and contract shops.
This number of establishments fell 466 short of the 1929 total, but
represented an increase of 1,000 over the 1933 total.
An analysis of the distribution of men's clothing establishments
shows that a very few states, namely, Ilew York, Illinois, Maryland, Mass-
achusetts, Hew Jersey^ and Pennsylvania, account for 88.6 per cent of
the 1935 total. Hew York State along accounts for approximately 50 per
cent.
The principal products produced under the Men's Clothing Industry
Code were: men' , suits, wholly or partly wool, mohair, and linen; men's
separate trousers; men's overcoats and tooccats; men's odd coats; boys'
suits; wool, cotton, etc; boys' separate ->ants; boys' overcoats; boys'
mackinaws, reefers, and light coats; and uniforms
The total value and volume of production in the Men's Clothing
Industry declined sharply from 1929 to 1934, the total garments for the
two years being 76 s 793~090 and 48., 171,000 with a value of $781,871,000
and $397,875,000 respectively,
A study of the distribution of wage earners in the Men's Clothing
Industry by States for the years 1923-1933, inclusive, shows a steady
decline, with the exception of the year 1939, from a high of 158,000
employees in 1923 to a low of 119,000 employees in 1933. Also, there is
noted a shift of employees during this period of time from the States
of hew Yoik and Illinois to the States of Pennsylvania and Maryland.
CHABACTjPJSTICS 07 THE IUDUSTSY
.There are several different types of firms- in the Men's Clothing-
Industry. Aside from the inside cr integrated shop, the two most
distinctive types are: Pirst, establishments which buy material, cut
the cloth, market the finished product, and finance the production from
raw materials to finished garment, but which often do not cwn and oneratc
the plant where the garments are ma.de. Lecchdly, there are establish-
ments called "contract shops'! which take oat cloth and accessories from
one who finances the business and --inform the remaining operations
necessary to completing the garment on a ;oie'ce price basis. There is
also found in the Industry the nnnuiVcturer-distributor, the "integrated"
manufacturer, and the special order or tailor-to-the-trade establish-
ment.
9782
•3-
Although there may be aa many ^s 163 operations in the making
of an overcoat, the operations in <* clotning factory can be divided
into a few distinct occupational groups, the principal of which are
cutters, f liters, sewing machine operators, pressers, basters, hand
sewers, snrpers, bushelers, and tailors. The advantages of large
scale production in the Men's Clothing Industry do not appear to be
very great. A shop employing fifty people is likely to be as efficient
as one employing a thousand.
During the last half of the 19th century, a number of new machines
resulted in a radical depar ture from old methods of production. These
machines included the power sewing machine, the power cutting machine,
^as Dressing irons, and machines for button-hole making, button sewing,
pocket making, cloth examining and sponging.
An aggregate investment in the Wen's Clothing Industry of
$100,000,000 is conservatively approximated by application to 1934
sales figures of a tested turnover ratio of 4 times net worth.
A lower mortality than in the '-omen':, wear industries is indicated,
but records disclose an increasing number of failures from 19?8 through
1932, decreasing during 1933-1934, and slightly increasing in the first
half of 1935. Causes of failure and numerous voluntary withdrawals
by reason of financial losses and discouragement are generally laid to
a profound lack of managerial ability; in part, to inadequate capital.
Seven years is the average business life of the entrepreneur, with
newcomers constantly filling the gaps and fading out through inefficiency.
The amount of capi + "l needed for successful operation is relative.
Credit is liberally supplied to well-managed concerns. The "inside
shop" manufacturer-wholesaler should have a Jiet worth of $50,000 to
$75,000, or more, tt> permit a volume turnover of 10 times and make a
reasonable profit after overhead expenses. A 7 times turnover was
considered the tire-depression average. It dropped to less than 4 times
in 1933. Ine turnover base applies also to the manufacturer using
contractors or "outside shops." With no investment in plant, his
capital needs are less, and turnover higher. The contractor — approx-
. imately equal in number to the manufacturing wholesalers — requires a
minimum of capital for his investment in sewing machines, etc. He does
no buying or selling, merely contracts laoor.
Manufacturers with less than $25,000 capital, and. those operating
in the lower price ranges, appear to have tne advantage in turnover.
The proprietorship investment is supplemented bv merchandise
credits and bank borrowing. A changed policy of woolen mills in weaving
to order, rather than for stock, and a shortening of terms to the
clothing manufacturer, have substantially increa.sed the latter' s
financial burdens. Continuous bank loans, instead of the former twice-
a-year liquidation, represent the current situation, made more tense
by seasonal 'activity changes and higher labor costs. Investment in
inventories has shown an increasing trend, tying up one-third more
9782
_4~
working . capital than formerly.;
Capital within the Industry declined steadily from 1930 to
the spring of 19.33. Speculation against rising prices commenced
with the enactment of the National Industrial Eecovery Act. Sales
increased, but net so fart as inventories. 1953 year-end statements
showea sots profit against prior losses. Profits, however, were
lessened by clumping of goods to lighten financial strain. Ton-
h^avy inventories carried over into 1934 had to be marked down in that
year, wnich for the average manufacturer showed even smaller rafofits
than 193". The concern with smaller capital, forced to buy cautiously,
fared, better than t,he competitor of medium size, who covered his entire
requirements in tne pve-Code speculation. The larger, well-financed
house was aole to carry the load and work inventory off gradually, during
1934.
The principal materials used in the Industry are woolen suitings
and nnntings. flannel suitings and pantings, tea-coatings, overcoatings,
worsted stable suitings and pantings. and fancy suitings and x>antings.
These materials were valued at $3 r 'l . "42,000 in 1929, but declined to
$157,602,000 in l Q o3. The- costs of these materials to the Industry,
plus fuel and purchased electric energy, averaged around 50 percent of
the value of the Industry's product for the years 1929-1933, inclusive.
In terms of estimated employment the range for the period 1926-
1935 is frcvi a hiah of apprcximat ely 156,300 in August, 1929, to a
low of approximately 107 s 000 in f'ay s 1933. The gain following the
improvement in employment in 1-933 is shown by an average employment
for 1933 of' 116,600-; far 1934, an average of 121,900; and for the first
ten months of 19Z5-, an average of 132,400
Wages in the L'en's Clothing Industry declined sharply from an
average of 75. cents an hour daring 1926 to a low point of 50.6 cents
an hour for 1932, but improved considerably daring the Code period,
from the fall of 1933 through the spring of 1935, to an hourly average
of 57o7 cents for the year 1934 and an average of around 60.0 cents for
the first months of 1935r The averare weekly wage in the Industry
declined from .the relatively high figure o^ $24,15 in 1927 to a weekly
average of $13,70 for 1232, Improv:.::-n J : followed in 1933, 1934, and
in the first ten months of 1935, with average weekly wages of $14.14,
$16.26, and $13.32, respectively..
Since 1923, the average annual wage in the Men's Clothing Industry
has declined more than -the average annual- wa«:e in all other manufacturing
industries. It likewise a/opears that the average annual wage in this
Industry has declined faster than has the cost of living.'
Of the large market areas, Chicago forj the last six months of
1934 revealed the highest average wage rate per hour, that o^ 78 cents
against an Industry average of 66.2 cents per hour. The market area
of Cleveland led the ten large areas in average weekly man hours for
the last half of 1934, with an average of 30 against the average for
9782
-5-
the ten large areas of 25.7 hoars. Rochester, with 22.3 hours, was
the lowest of tne large areas.
A study of stability of employment in t he Fen's Clothing Industry
by the U.S. Department of Labor for tne years 1923-1928, covering
sixty-four establishments in various lines, showed that conditions
were bad and that no improvement was made in the six years covered by
the study. The average stability for the plants was only 87.9 percent
in 1923 and in no subsequent year was the percentage that high.
One of the most striking phases of the Fen's Clothing Industry
during the period 1923-1929 is the movement of the Industry out of
the major manufacturing centers 'into smaller cities and country
districts. Figures from the U. S. Census of Manufactures arc cited
to prove the point.
Since 1911, the Amalgamated Clothing workers of America has
been the dominant union in the Men's Clothing Industry, which is now
about 80 to 85 percent organized. This union has been very aggressive
in its efforts to improve the lot of the workers as a ^hole, and has
at the same time, through cooperation with employers, made noteworthy
efforts to stabilize conditions in the Industry. Such cooperative
action has had as its objective the solving of the problems of "sta-
bilizing production, reducing costs, eliminating waste, composing
differences promptly and peaceably, and taking advantage of new technical
advances in the Industry without impairing the workers' earnings."
Manufacturers in this Industry frequently use a combination of
channels to effect the distribution of their products. In the larger
cities some manufacturers own or control their own retail outlets. In
the smaller cities and towns they sell direct to the retailer. The
manufacturer may sell direct to the large department and chain stores,
and indirectly to retailers who purchase in small quantities. Direct
selling occupies a dominant position in the distribution scheme due
to the nature of the product and localization of the Industry — particular-
ly in reference to style.
Wholesalers of men's clothing find it advisable to develop their
own brand, or act as a resident buyer for a group of retail stores, or
organize and supply cooperative retail buying associations.
Certain manufacturers of men's clothing, prodacing in large volume,
offer their products to the consumer through their own retail stores.
Attention is called to the Eond Stores in the Northern and Eastern
States, owned and operated by the Aplo Company. Operating mainly in
the Southern and Western States, Richmond Brothers sell through
approximately sixty of their own retail stores.
House-to-house selling appears to develop rapidly during and after
periods of business depression. One concern, the Nash Tailoring Company,
of Cincinnati, Ohio, is supposed to have sold over 500,000 suits and
9732
-6-
overcoats in one year using this method.
The importance of established uniform standards in all branches
of industry has been recognized for many years. To date there have
been none adopted by the I'en's Clothing Industry as regards measure-
ments and sizes of garments; labeling to show fibre content of fabrics
used; marking to show the guaranteed ore-shrinkage treatment to which
the fabrics have been subjected; and what can be exnected as to the
color fastness of the cloth used in the garments. This information,
based on properly established standards, should be stated clearly and
simply on a label attached, to the garments offered for sale.
The importance of knowing the fibre contents of the cloth from
which a garment is made is apparent when it is realized that the
quality, strenth, appearance, warmth, elasticity, durability, etc.,
of the fabric depends on the fibres used in its construction. Each
of the various fibres commonly used in the production of cloth has
its individual characteristics, and they differ from one another due
to having passed through different processes of manufacture.
The consumer, if financially able, generally nrefers clothing
of all wool construction but, without some standard method of labeling
to show the true fibre contents of the cloth from which the garments
are made, mast depend on the information given by the salesoeonle,
who do not always know.
The' Tailor-to- the-Trade Division of the Fen's Clothing Industry
presented an amendment to the Code of Fair Competition for the Hen's
Clothing .Industry at a hearing heir April 15, 1S35, regarding labeling
to show the fibre content of the clcth used in the production of
garments. No official action was taken on this orooosed amendment.
■Resolutions ->doi3ted by the Board of Directors of the National
Association of "Jool Manufacturers, February 15, 19S5, show the impor-
tance attached to this matter of labeling by the producers of the
cloth.
Excerpts taken from the statements made in supoort of an amendment
to the Code of Fair Comioetition for the Men's Clothing Industry, re-
garding shrinkage, at a hearing held April 15, 1935, state the methods
of shrinkage com'. only used, the results obtained, and the necessity
for the practice. They looint out that the use of unsinrunk cloth in
the manufacture of garments is increasing, as is the so-called practice
of stretchage.' They show the efforts being made to overcome these
bad practices and present evidence that- the equipment and organization
to treat fabrics properly exists in the Industry. They also emphasize
tne efforts the Industry is making to bring about a standard of cloth
shrinkage and conditioning.
Mucn important work and study is going on in the Industry regarding
the subject of color fastness.
9782
■7-
The statement of Dr. D.E.Douty, of the U. S. Testing Co., Inc.,
regarding labeling, is interesting:
"In my opinion the chief value of., compulsory label-
ing lies not in the "technical. Information given to
and utilized by the ultimate consumer, but in the
restraining influences it exercises over the pro-
ducer and the direct obligation placed upon him in
his relation to the regulatory agencies of tne State
and Federal Government."
The "Bureau of Standards is cooperating with various groups of
manufacturers, distributors, and consumers, looking toward the
standardization of sizes, measurements, shrinkage, color fastness, and
other criteria indicating quality of garments and other apparel.
PRE- CODE FFCBLEKB OF THE INDUSTRY AND 7/RITING OF THE CODE
The Ken's Clothing Industry from 1923 to 1932 showed consistent
declines in product value, employment, and rates of pay. In 1923
the product value was around one billion collars, but for each of the
years 1933 and 1934 was approximately $450,000 ,000. in 1923 the
highest number of workers employed in the Industry was 168,771; it is
estimated that around 118,000 were employed during 1933, although
about 160,000 were attached to the Industry. Allowing for migration in
the Industry and other factors, around 48,000 were unemployed in
early 1933.
'■".ages in the Industry for several years prior to the Code had
been affected by the actual decline in wage rates and the decrease
in employment. It is estimated that actual hours of work declined
10 percent from 192? to 1952, while hourly earnings also declined.
In 1922, the average hourly earnings were 72.8 cents and in 1932
only 50.6 cents, thus unquestionably affecting average annual earnings.
The average clothing manufacturer with a sales volume of less
than $1,000,000, against a loss of 10.3$ in 1932, had an apparent
profit of 9,2?o in 1953, reduced in 1934 to 5,1$. Profit and loss
variations of larger manufacturers are indicated.
The average manufacturer's operating control is sadly deficient
through ignorance of actual costs. A true cost formula is seldom
apolied, and expenses are not properly budgeted. 'Underselling of own
product frequently results.
From the manufacturers 1 viewpoint, the oust and ing problem relates
to the high and mounting costs of labor. In tneir relation to the
sales value of merchandise sold direct, labor costs have increased
nearly 78^ in the oeriod from 19?9 to 1934 according to an independent
study of random cases. Indirect costs are reflected in disturbances
9782
created in an effort to reduce the direct labor ratio to sales,
complex si taati on creates unfair competitive conditions and the
racketeering element creeps in.
Two codes were proposed for the Men's Clothing Industry; one
by the Clothing Manufacturers Association of the United States of
America, and one by the Industrial Recovery Association of Clothing
Manufacturers. The first-named group at tne outset appeared to
represent about 75 percent of the industry. The real points of
difference between the groups arose from the fact that the larger
group had contracts with the Amalgamated Clothing "Vorkers of America,
while the smaller group was almost entirely independent except for a few
employers who dealt with the United Garment 'Workers' Union.
The two rival groups in the Men' s Clothing' Industry could not
resolve their differences with respect to a plan for administering
the Code and for wage provisions for the skilled employees. The
Industrial Recovery Association insisted en equal rights and cowers
in zny administrative set-up and would not be satisfied with a minority
representation upon any board of control. 7ith respect to wages above
the lowest minimum, the minority group insisted upon a flat increase
of 20 percent for those earning up to $30.00 x>er week. On the other
hand, the Clothing Manufacturers Association, with labor support in-
sisted upon a minimum for one of the highly skilled groups and a
provision that "the existing amounts by which wages in the higher-
paid classes, up to classes of employees receiving Thirty Dollars
($30 00) per we<=k, exceed wages in the lowest-paid substantial
classes shall be jnaintainede " "Shsse differences of opinion were irrecon-
cilable and were resolved only through Administrative action in
accepting the code prepared by the Clothing 1 anuf acturers Association.
Trade practice provisions were designed to eliminate "evils"
more or less peculiar to the Industry; that is, homework and the
practices of consignment and "cut, make, and trim." The last-named
prohibition is directed o'nly at retailers. Additional trade practices
concerning methods of sale and credit terms, etc., were proposed but
were never formally approved. It is significant that the Code made no
provision for learners and apprentices despite some demand, and that
no satisfactory method was evolved for recognizing the fact that
somewhat dis-similar methods of production are employed in the Industry.
CODE ADMINISTRATION— ORGANIZATION AND PROCEDURE
The Men's Clothing Code provided for a Code Authority composed
of twenty-tnree members, made up as follows:
ten members frpm the Clothing Manufacturers Association;
five members appointed by the last-named association
from other than members of the Association;
9782
-3- -
t : "0 members elected by the foregoing menbers representative
of other employers;
five members representative of labor; and
one member appointed hy the Administration.
The Deputy Administrator, in recommending the Code for aporoval,
stated definitely that the "five members" to be apoointed by the
Clothing Manufacturers Association were to be selected from the
Industrial Recovery Association.
The Clothing Manufacturers Association aoooirted its ten members,
out could not prevail upon more th?n t"'0 of the minority grouo to
accept membership. Hence, the remainder of the "five members were
selected from the Industry at large. The "two" members were not
selected, a-aiting, according to the Code Authority, some settlement
of the Cotton Garment controversy. The labor representatives were
selected bv the Labor Advisory Board and the Administration Member
rs dulj/ appointed.
Formal recognition of the Code Authority was lon^: delayed. The
labor representatives were recognized by official order of July 6, 1334,
although they had been serving since September of 1933. The labor
group of five was made up of three officials of the Amalgamated
Clothing "'.'orkers and t ,,T o officials of the United Garment Workers.
Fifteen Industry memoers of the Code Authority were first recognized
October 19, 1934, contingent upon a reorganization of the Code Authority.
Upon request from the Code Authority, which pleaded probable change s
in the Act, this recognition was extended until June 16, 1935.
The Code Authority activities are somewhat departmentalized, The
principal departments oeing the Label Division, the Compliance
Division, and the Statistical Division. Much of the Code Authority
work was carried on by special committees, typical of which were the
executive Committee, the Compliance and Enforcement Committee, the
Committee on Fair Trade Practices, and the II (c) Committee (wa£;e
comoliance) .
The Code Authority was given official authorization to handle
"^11 complaints 'in the first instance" on January ??, 1934. Actually,
the Code Authority at the very outset established its cmi compliance
procedure raid ^ent about the adjustment of complaints and allegpd
violations of the Code. The Code Authority's compliance procedure
was very early the subject of .Administrative review and some question
was raised regarding methods employed. No outward criticism ns
made, however, of Code Authority compliance procedure.
The label was used by the Code Authority as a device for raising
funds and for gaining compliance. The label regulations did not conform
in every particular with Administrative Orders X-38 an? X-135 relating
9782
-10-
to the use of labels, and did not appear to have received formal
approval "by the Administration. The label regulations provided for
the filing of a compliance certificate which set forth information
about methods of manufacture, Labels were required on individual
garments and were to be attacaed daring the process of manufacture;
they were sold to cover a four weeks' production period, and for cash.
Labels were withheld or withdrawn only upon authorization of the
Compliance Council. This last-named provision, which was closely
adnered to, is significant in that the Code originally gave permission
to the Code Authority to withdraw labels upon its own findings, subject
to Administrative approval.
The Code Autnority empnasized the imoortance of the label in
raining Code compliance and consistently expended substantial sums
of money in developing "label mindedness" among consumers. The Code
Authority felt restrained in its label advertising by budgetary limi-
tations set up by the Administration.
The Code Authority first made plans for t'ie submission of a
budget for Administrative approval in June, 1934. Action was taken
in this regard in order to meet label requirements. Nevertheless,
the Code Authority early after its inception made plans for an independent
audit, at the same time covering employees with a blanket surety policy,
and providing for the safekeeping of fanes.
She Men's Clothing Cede Authority carried on its affairs from
September 6, 1955, to June 30, 1S34, without an approved budget. A
budget was submitted covering the period from July 1, 1954. to
December 31, 1S34, and tentative approval of this budget was given
on January S, 1955. No approval was given any subsequent budget for
the period after December 31, 1S54, or for a budget covering the
period from September b, 1933, to Jane 30, 1934.
The budget for the period ^uly 1, 1934, to December 31, 1934,
was approved contingent upon the submission by the Code Authority of
a report with reference to the p'ore economi "il administration of the
Code and a study of the equitability of the system of label charges
then in effect. This approval was finally extended by Order No.
15-50, pending farther order under the same provisions in order to
give the Code Authority time to submit a new budget to cover the first
half of 1935. Such a budget was finally submitted and '"=is the subject
of conferences between the Administration and the Code Authority at
the time of the Supreme Court decision relative to N. R. A.
Subject to the conditions outlined in the Order approving the
budget for the last half of 1954, the basis of contribution, that is,
the label charge, was changed from $5.00 per thousand to $3. on per
thousand to apply to labels for use on certain infants' and children's
varments.
The activities of the Code Authority, as already indicated, were
9782
-11-
financed by the sale of labels which were purchased by the manufacturers
of men's clothing. The total of labels sold from September 6, 1933,
to April 30, 1935, was 137,700,579, yielding the sum of $682,368.77.
For each of the six-month budgetary periods of July 1, 1934, to
December 31, 1934, and January 1, 1935, to June 30, 1935, ^n estimated
net income of $160, onn was provided. This was to provide for expen-
ditures approxinat ing $30,000 per month.
The price at which labels -ere sold (equal to h<t per single garment,
plus the actual cost of sewing on the label) was so slow that the-re
was no material addition to the cost of the garment.
In keeping with the powers authorized by Article VIII of the Code,
members of the Industry were required to furnish payroll and production
data to the Cede Authority. An arrangement was entered into with the
Bureau of Labor Statistics and the Census Bureau '-hereby the reports
•^ent directly to thes° Bureaus for certain compilat ions and tabulations
before being forwarded to the Code Authority. This arrangement appeal's
to have been satisfactory to all concerned. The reports made to the
Code Authority were used almost entirely for compliance purposes.
Industry statistics were not reported regularly to theAdministrat ion.
Most of the Interpretations recommended by the Code Authority
and approved by the Administration had to do with the classification
of workers between employee groups mentioned in the Code; that is,
manufacturing, non-manufacturing, supervisory, cutter, and off-presser.
These interpretations were found necessary because certain employees
did not fall clearly into any one of the classif icat irns. The need
oT1T~def ihiTe classification was further emphasized by the varying
ratesof nay, methods of payment and hours of work peculiar to the
respective groups. For example, Administrative Order No. 15-23,
aated July 19, 1954, provided that: "A worker who cuts a piece of
lining from the bolt and uses a pattern as a guide for cutting said
lining, is a cutter within the definition." This interpretation
placed the lining cutter in the category of the "cutter" — the highest-
paid manufacturing class recognized in the Code, and entitled to
pay of $1.00 per hour, otherwise, this lining cutter might have been
paid in some plants at a lower rate of pay, with the 40 cents per hour
minimum as the base rate.
The most significant interpretation made by the Code Authority
and belatedly given Administrative approval was that "the words
'substantial classes' as used in article II, subdivision (b) are to
include 20 percent of the total number of employees employed in any
establishment." This interpretation found frequent use in the enforce-
ment of the clause concerning wages above the minimum, and was the
subject of much controversy and criticism within the Industry.
The records indicate the lack of complete cooperation between
the Administration and the Code Authority with respect to interpre-
tation procedure. This was due in part to delay in working out
general N.R.A. procedure and in part to neglect upon the part of the
9782
-12-
Administration, For instance, certain interpretations recommended
by the Code Authority early after its inception were not acted on by
Administration officials until December, 1934. Others acted on by the
Code Authority early in March, 1954, did not receive Administration
approval until the middle of July» 1934.
LABOR UNDER THE CODE
The Men's Clothing Code provided for a 36-hour week except for
certain grouos such as repair shop crews, engineers, office staff,
etc. , who could not work in excess of an average of 40 hours per week
during any year. The tailor-to-the-trade and uniform manufacturers
branches of the Industry, because of the Industry, because of the
highly seasonal character of their operation?, were allowed overtime
at regular rates for specific periods determined by the Code Authority.
Both codes originally proposed for the Industry asked for a 40-
hour week maximum, on the assumption that this would absorb completely
the unemployed attached to the Industry. The Research and Planning
Division of N.R.A. , however, at the time of the writing of the Code,
concluded that neither a 40-hour "-ee 1 : nor a 35-hour week would reemploy
the idle attacned to the Industry, unless there was a considerable
increase in demand.
As provided in the Code, the Tailors-to-the-Trade and the
Uniform Manufacturers were granted overtime regularly each' peak
season. This overtime was extended ordinarily in the amount of four
hours extra per week for a period of from eight to ten weeks at
regular rates of Day on condition that the apulicant give evidence
of running to capacity.
The entire Men's Clothing Industry, excepting Tailors-to-the-
Trade and Uniform Manufacturers, was granted overtime in the amount
of four hours extra, per week beginning March 4, 1935, and ending
April 6, 1935. This overtime was granted upon the request of the
Code Authority and for the reasons (a) o^ late delivery of woolens
and (b) the excess of fancy models which unbalanced highly skilled
sections of the Industry. This exemption was protested by the
Industrial Recovery Association. Also the Philadelphia Joint Board
of the Amalgamated Clothing '.Yorkers protested the exemption on the
grounds that the extra hours were not needed while workers were yet
unemployed and that it was merely an opening wedge for a longer work
week.
In the few exemptions granted from hours provisions to groups
and individuals no distinction was made between enraloyee hours and
machine hours. All reauests for employee hours exemptions have
carried automatically, of course, a request for machine hours ex-
emptions. The Industry has operated customarily on a one-shift
basis and the 36-hour week established has not created a demand for
9782
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a double shift. The Code Autnority consistently refused to recommend
exemptions from the labor provisions : Of* the Code , with. but one or two
exceptions. The most notable of which are 'the 'Cases, of Puerto Rico,
where the competition meant little, and five Up "»' Orleans, firms which
produced cotton garments in competition with firms operating under
the Cotton G-arraent Code. Only a few additional exemptions were granted,
and those for short periods covering emergency situations. Most of
the denials of exemptions from hours provisions were denied on the
grounds of the surplus man power in the Industry.
The Men's Clothing Code as originally adopted provided for a
minimum wage of forty cents per hour for manufacturing employees
and $14.00 per week for non-manufacturing employees in the northern
area and 37 cents wr hoar and $13.00 per week respectively for the
Southern area. For two higher payed occupational groups, cutters
and off-pressers, there were set minimoms of $1.00 and 75 cents per
hoar respectively. Tne Code provided, furthermore, for the setting-up
of a Committee to administer the wage provisions.
The codal provisions respecting pay were pmended to alio 1 " 7 the
employment of apprentices at 70 percent of Code wages for the period
of tnree months from December 11, 1933, to permit readjustment to the
Code's abolition of home work. Handicapped workers could be employed
at 70 percent of the Code minimum wages. Also, the Code was amended
to allow lower rates of -cay tnan originally provided for workers on
certain cotton or part cotton garments.
During the first week of February, 1935, a hearing was held in
V.'ashi.igton relative to proposals from the Code Authority that classified
rates of pay be set up in the Fen's Clothing Industry. The amendment
as proposed by the management members of the Cede Authority would
classify workers into about 15 classes with rates of pay, including
those now in the Code, of $1.00, 75 cents, 65 cents, 50 cents, and 40
cents. This amendment was designed chiefly as a substitute for the
codal wage orcvision which was found most difficult to enforce;
namely, that "the existing amounts by which wages in the higher-paid
classes, up to classes of employees receiving Thirty Dollars ($20.00)
per week,' exceed wages in the lowest-paid substantial classes shall
be maintained. "
As in th^ case of hour provisions, the Code Authority declined
+o grant exemptions from the wage provisions of the Code. Puerto
Pico ar-^in appears an exception, and the only one. The Code Authority
steadfastly refused to consider an apprenticeship provision for the
Code, arguing that the unemployed in the Industry must first be cared
for.
The ten's Clothing Code Autnority was very aggressive in the
matter of enforcement and efforts tc gain compliance. A comprehensive
analysis of compliance is not possible inasmuch aft the greater part
of alleged violations wefe -adjusted. Dythe Code, Autnority. Deputy
9782
-14-
Administrator Mi Di Vincent made a complete survey of the enforcement
activities of the Code Authority up to August 30, 1934, and reported
that that Code Authority's investigators had covered all the important
markets impartially and that the provisions of the Code had been
enforced without discrimination. The only adverse criticism was
directed at the Gode Authority's strongly -vorded letters to alleged
violators of the Code.
In the matter of compliance the Code Authority experienced its
greatest difficulty with the provision relating to wages of the higher-
paid classes. I uch confusion and dissatisfaction developed in certain
quarters of the Industry because of the somewhat arbitrary manner in
which it was necessary for the Code Authority to interpret and apoly
clause II (b) of the Code, '"hich relates to the wages of the most
skilled groups. This confusion was increased by the fact that the
Administration .was late in giving approval to interpretations relating
to clause II (b). In trying to enforce II (b) , the Code Authority
often had to resort to compromise ,or arbitration, sometimes with
Administration aid, which in turn gave rise to the criticism that
unusual and unjustifiable powers were assumed , as for instance in the
case of L. Grief and Brother, of Baltimore, Maryland.
Pre'-Code statistics on men's clothing are not directly comparahle
to statistics collected under the Code , yet certain compilations
based on payroll and oroduction .6 .ata give some indication of trends
in the Industry. The Code Authority estimated that approximately
140,000 workers were employed during the Karen peak season of 1934
as against 108,000 for the same season of 1S33. ^rom March, 1934,
to September, 1934 j ■ however, there was a reduction of about 15 percent
in the number of oersons employed.
Hourly wses f or al 1 manufacturing employees, including cutters
and off-pressers, in July. 1934, averaged 67.1 cents per hour. In
March, 1933, the average was approximate ely, 42 cents per hour. Hourly
earnings reached their peak in the Industry during 1924 — 76 cents per
hour. During August, 1934, manufacturing employees worked 27.8 hours
per week on the average, while weekly earnings averaged $18.63. It
is understood that the. Spring season of 1935 was 'comparable to that
of 1934, witn around 140,000 employed. This is in part exolained by the
slowness of the Fall season of 1934.
TRADE PRACTICES
The principal fair trade practice provisions of the Ten's Clothing
Code relate to sale of garments on consignment, the oractice of "cut,
make, and trim," and sellin? below cost.
Consignment selling was pronibited in the Ten's Clothing Industry
with the full approval of all branches of the Industry. It was generally
agreed that consignment selling in the long run tended to injure both
9782
-15-
the seller and buyer whether financially strong or weak and led to the
breaking-down of labor standards.
Five exemptions were granted from the provisions prohibiting
consignment selling; the. -orincipal in point of dollar volume was
that of S. I. a kr an sky and Sons, Inc., Phil ^delphia, Pa. All exemptions
were granted for the purpose of allowing the participating firms to
prepare in an orderly way for a change to normal selling.
The "cut, mike, and trim" practice was outlawed by the Code
insofar as retailers were concerned:. All branches of the Industry-
were united in the opinion that, the "cut, make, and trim" practice
was pernicious and should be stamped out. It was argued that the
practice made impossible an orderly supervision of hours of work,
wages and sanitar- working conditions in the plants so engaged.
I;o exemptions «erp granted from the "cut, make, and trim" clause.
On tne contrary, the Code Authority made reoeated efforts to strengthen
this clause by making it applicable to wholesalers and jobbers as well
as retailers. Sears, P.oebuck and Company made strenuous efforts to
obtain exemption, but was denied after public hearing.
Tne Code carried in Article X a prohibition against selling
belo'v cost. Soon after its organization, the Code Authority after
considerable study and investigation submitted for Administrative
approval a cost formula designed for use throughout the Industry.
The formula provided, with explanations, that the total cost of a
garment should be arrived at by adding to the -prime cost -m amount
ea^al to 5 percent of such prime costs for General I anuf acturing
Overhead, and by adding to the new total so obtained, an amount
equal to 11.11 per cent for Selling and Administrative Overhead.
No provision was made for profit, but the percentages were to be
mandatory.
After considerable delay, the Administration finally advised
with respect to the proposed cost formula tnat the Code would not
permit the stipulation for tne entire Industry of a mandatory per-
centage for overhead, regardless of the merit of the percentages
chosen. The final outcome was that the Code Authority made no effort
to enforce the selling below cost provisions. '..herever comol=ints
of violations of trade practice provisions were filed, an investiga-
tion of the alleged violation was made by the Code A-ithoritv to
discover whether or not the labor orovisions of the Code were being
observed.
After many conferences wLtn retailers and wholesalers, the Ten's
Clothing Code Authority was able to form ilate certain fair trade
practice provisions which met -ith the aoaroval of the groups concerned.
These proposed fair trade or^ctices were submitted to the Administration
for consideration, and related in the main to: discounts, terms of
sale, return of goods, sales at retail, labeling of goods (quality), and
cash advertising allowances.
9782
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.. > .CHAPTER I
DEFINITION A1I3 SCOPE 07 INDUSTRY
I. CODE DEFIHITI01I AND JURISDICTIONAL DISPUTES
The original codal definition of the Men's Clothing Industry reads:
"The terra 'Clothing Industry' as used herein is defined
to iraan the manufacture of. men's, "boys', and children's
clothing, uniforms, single knee pants, single pants,
and men's summer clothing (exclusive of cotton wash
suits) a"
The above definition was the result of several conferences colled
to resolve the differences of opinion as to what the code for the Indus-
try should properly cover. It early developed that the definition for
the Lien's Clothing Industry was in conflict with proposed and oftentimes
accepted codal definitions for other industries. Among the industries
having codal definitions or suggested- codal definitions in conflict with
the definition of the Hen's Clothing Industry are found the Cotton Gar-
ment Industry, the Merchant and Custom Tailoring Industry, the Rainwear
Division of the Rubber Industry, the Textile Examining, Shrinking and
Refinishing .Industry, the Shoulder Pad Manufacturing Industry, the Slit
Fabric Manufacturing Industry™ the Coat Front Manufacturing Industry, the
Infants' 'and Children's Wear -Industry, the Knitted Outerwear Industry,
and tailoring shops operating under the authority of the United States
Government.
The Men's Clothing Code Authority "became embroiled in many juris-
dictional disputes and controversies, and. before proceeding to an analysis
of individual conflicts, attention is directed to the following resolution
drawn up March 2, 1934, by George L c Bell, Executive Director of the Men's
Clotling Code Authority, and proposed to the- Code Authority at the "Sub-
stance of Resolution for Code Authority to Submit at Conferences of Code
Authorities at Washington NextlTeeko" (*) This resolution indicates rather
clearly, a fter about six months' experience, the Code Authority's feelings
with respect to the extent, nature, and general result of the many and
seemingly interminable jurisdictional disputes. The resolution expres-
sive of the Code Authority's oninion is as follows:
"WHEREAS, this actual experience hp,s disclosed the
fa.ct that practically all the difficulties and lack
of ability to enforce the provisions of the Code
have been brought about by jurisdictional disputes,
which have permitted entire sections of the indus-
try and large numbers of tianuf acturers to plead im-
munity from enforcement of the Code because of largely
unwarranted claims that they were subject to some
(*) Bound Copy of Resolution Proposed by George L. Bell, Executive
Director, (Men's Clothing Code Files.)
978?.
-17-
***
other code that has been promulgated, or to some
proposed code that is under consideration, and
n THEREFORE, be it resolved that the Men's Clothing
Code Authority, as a result of this actual exper-
ience which cm be substantiated by factual evi-
dence, strongly urges and recommends that these
jurisdictional disputes and attempts to promulgate
innumereble codes for small branches of the indus-
try which are incapable of enforcing the provisions
of a code, be terminated b 7 an excutive order desig-
nating the Men's Clothing Code as the basic code
covering all manufacturers of men's outer clothing;
with the Men's Clothing Code Authority as the supreme
administrative body; with special provisions, where
necessory, for subdivisions of the industry; and with
sub-committees, representing the interests of sucn
subdivisions, for presenting and handling their pro-
blems with the lien's Clothing Code Authority.
"This resolution is tendered because we believe that
it is highly impracticable, if not impossible, to de-
fine -oro-oerly and clearly subdivisions of the industry
that claim to be entitled to separate codes.
"An unconscionable amount of time has been consumed
by members of the Lien's Clothing Code Authority and
by members of the staff in connection with innumer-
able hearings and conferences on such proposed codes
as the merchant tailors, the canvas coat front mak-
ers, the shoulder pad makers, the infants' and chil-
dren's -ear manufacturers, etc., etc. These hearings
and conferences, stretching over many months, made
it clear that the national Recovery Administration
finds it -oractically impossible to make clear code
definitions which will insure that everyone connec-
ted with any uart of the ken's Clothing Industry is
included under some fair competitive code. Further-
more, the actual experience of attempting to classify
various garments through the medium of the Inter-Code
Committee with the Cotton Garment Code proves that
months and months go by without any action and that
in the interim literally hundreds of manufacturers
escape the application of any code to their business,
A. The Cotton Garment Indus try . (*)
The jurisdictional conflict between the Men's Clothing Industry and
the Cotton Garment Industry was of major consequence, and because of the
complicated nature of the problem, as well as its importance to both indus
tries, a detailed consideration of this problem with supporting da will
be found in Aooendi:; C.
(«) gre^re^ V Writer E. Woodford, Jr., member of the Men's Clothing
Industry Study group, Sezctile Unit, Industry Studies Section,
Division of Review, H3A»
£782
-18-
Prior to the last few years, Cotton Garment plants confined their
production mostly to overalls, work pants, and wash suits for use as
work clothing only, and Hen's Clothing plants produced the great majority
of separate trousers of wool or part wool materials. But the recent
fashion trend toward the use cf separate costs and trousers, the narked
improvement in appearance, style, ard durability of cotton and cotton
mixture fabrics, at prices far below those of woolen fabrics, and the
increased interest in sports and outdoor life throughout the entire
country, have created a large demand for separate snorts and dress trou-
sers, at the expense of the work pants and overalls of former days.
Cotton Garment Manufacturers, to meet this lessening demand for
overalls commenced the production of better line of separate trousers,
in competition with the regular clothing factories. They found that
such trousers, as well as ng,ckinaws, melton jackets, play suits, and
similar garments, could "be made without changing their plant equipment,
personnel, or organization, could be sold through the sane channels of
distribution, and enabled then to keep their factories in operation
throughout practically the entire year.
When the Codes of Pair Competition were formulated and approved
in 1933, this competitive and overlap >ing situation became a major -ore—
blen to the manufacturers of both industries, due in a. large measure to
the more favorable wage and hour provisions in the Cotton Garment Code
as originally approved., and the production of work and dress pajits by
prison labor at even- lower wages.
This jurisdictional controversy, especially on single pants and wash
suits, thus began with the effective dates of the Codes, aJid was never
satisfactorily adjusted in spite of the continuous efforts of the national
Recovery Administration, the Code Authorities, and the Industry members
to settle the conflict by amending definitions, wages, hours, etc., of
both Codes.
This Study is aimed to trade, in chronological order, the various
steps taken in attempting to adjust this problem, the viewooints of the
interested factions, the objections raised to the amendments adopted,
and the final plan proposed just before the Supreme Court decision of
May 27, 1935, which from all indications would have met with the approval
of the majority of both industries and. would have been successful in
placing the production of these disputed garments on a fair and equitable
basis under both Codes*
1. The Cod.es as Originally Approved.
The lien's Clothing Code, approved August 26, 1933, established a
36-hour maximum week, a 37^ P er hour Southern and 40^ per hour northern
minimum wage, with higher classified wages for cutters and off-pressers,
and 37rf per hour rate for workers on single knee pants.
9782
-19-
The Cotton Garment Code, aoprb've'd November 27, 1933, established
a 40-hour maximum week, a 50^ per hour Southern, and 32-jfi per hour Nor-
thern minimum wage, and no classified wages.
, Definitions in both Codes were incomplete and conflicting, the
Clothing Code including "single knee pants, single pants," and the Cotton
Garment Code including "men's and boys' pants in chief content of cot-
ton."
Thus, with single pants included in both Codes, and hour and wage
advantages permissible in the Cotton Garment Code, conflicts were in-
evitable on pants and wash clothing. Clothing manufacturers immediately-
protested that Cotton Garment manufacturers were producting pants and
wash suits at much lower consts, and were seriously threatening their
buisness on such garments.
2. Amendments of December 18, 1933.
. A Public Hearing was held November 27, 1933, on wash suits. A
group of five New Orleans firms, manufacturing cotton and linen wash
suits and operating under the Men's Clothing Code, claimed their gar-
ments were actually sold in competition with cotton wash suits ma.de by
Cotton Garment manufacturers, and that the higher wages and shorter
hours of the Clothing Code imposed an unjust hardshin on them. The
Goodall Company, manufacturers of "Palm Beach" suits, submitted similar
arguments.
The Cotton Garment manufacturers, on the other hand, claimed that
their cheap wash suits, produced in quantity lots, like overalls and
work clothing, did not compete with the higher-priced suits sold for
dress use; and the Men's Clothing Code Authority argued that all wash
suits of the better types \ised fdr dress purposes were summer clothing
and should be made under the same conditions as all -other summer cloth-
ing such as tro-oical worsteds, silks, silk and wool mixtures, etc.
On November 23, 1933, a Public Hearing was held on single pants.
Manufacturers of cotton single pajits argued that the low selling prices
of their garments necessitated their production under the lower wage
scales of the Cotton Garment Code. Manufacturers of wool pants, most of
whom also made some cotton pants, claimed that all pants were articles
of Men's Clothing, and should be under the Clothing Code; that a pants
factory could not be successfully operated under two Codes; and that
many cotton pants plants were greatly increasing their production of
wool pants, to the decided detriment of those manufacturers operating
under the Men's Clothing Code.
These hearings and subsequent conferences failed to produce any
satisfactory agreements between the two industries, and the ITatinal
Recovery Administration inaugurated the following changes in the tr:Q
Codes, approved on December 13, 1953.
9732
-BO
(a) Men's Clothing Code.
"Definition on these garments was changed to "single pants (except
work pants or single pants when made in work«clothing factories) and
men's summer clothing (except men' s w?.sh suits of 100$ cotton content,
when made in work-clothing factories in conjunction with work clothing)."
Minimum.. wage to workers on single pants was to be 34^ per hour in the
South and 37 rf per hour in the North. Minimum wage "to workers on men's
wash suits of 100$ cotton content was to be 34rf per hour in the South
and 37f£ per hour in the North; to workers on other summer clothing, '37^
per hour in the South and 40^ per hour in the North, Minimum wage to
cutters on all men's wash suits and/ or summer clothing was to be 85f£
per- hour and to of repressers of such garments 60^ per hour in the South-
ern section of -the Industry.
(b) Cotton Garment Code.
Definitions on these garments were changed to "(10) men's and boys'
pants, when made in work-clothing factories," and "(14) men's wash suits
of 100$ cotton content, when made in i7ork~clothing factories in c onjunc-
tion with work clothingr" Minimum wage to workers on men's wash. suits
of 1 100$ cotton content and/ or men's and boys' pants when made in work-clothing
factories in conjunction with work-clothing or work pants was to be 34j#
per hour in South;, and 37.;* per hour in North.
An Inter-Code Committee of seven (7). persons was appointed t o admin-
ister and supervise enforcement in respect nf cotton wash suits, and/or
single pants.
It was hoped that these Code changes would tend to clear up this
serious competitive situation between these industries, but further study
and recommendation was deemed necessary, hence the appointment of the
Inter-Code Committee.
3. The Inter-Code Committee
The Committee first met on Ja.nuar;/- 5, 1934, and the problem of
classifying single pants was approached primarily from the standpoint
of fabric. After numerous meetings and votes on disputed fabrics, this
Committee recommended to the Administration a further amendment to the
Cotton Garment Codec,
The Inter-Code Committee devoted its entire time to the oants
question, so the men's wash suit problem was handled in a different
manner. After continued protests from the New Orleans manufa,cturers,
Special Deputy Administrator Morris Greenberg was sent to New Orleans
to make a complete survey of the situation, and submit recommendations.
As a result, Administrative Order No 15-8 was approved February 23, 1934,
permitting these firms to work an additional four (4) hours per week, and
an agreement was made with the Men's Clothing Code Authority permitting
them to employ up to 30$ sub-standa.rd workers and exempting their pla„nts from
the application of Article II (b).
9782
-21-
4. Amendment to the Cotton Garment Code — March 15, 1934.
In accordance with the recommendations of the Inter-Code Committee,
this amendment rras r -. proved setting up a minimum rate of 30rf er hour in
the South, and 32-^/f per hour in the ITorth, for the production of pants
of certain specified fabrics, such as denims, coverts, ducks, etc., and
rates of 54rf and 37., J on certain shads of cnrduroy and all other fabrics
except those listed under the other classification. It also abolished the
Inter-Code Committee and transferred all its powers and duties to a Special
Administrator for further study and recommendations, Godfrey Bloch was
appointed ^s Special Administrator.
It soon became apparent that this attempt to settle the question by
classification of fabrics would not solve the difficulty, and that it
would be impractical and impossible to 'attempt to force manufacturers to
pay' higher wages on certain types of cloth than on others, when both were
worked on by the same operators. Many manufacturers made no effort to
differentiate between fabrics, and continued to -pry the lower wage scales
on all garments. I'umerous comjladnts of unfair competition and objections
to the new amendment were filed r with the Administration.
(a) Report of the Special Administrator.
Mr. Bloch and his staff found it impossible to a.cconuish much in
administering or supervising enforcement, but they did make a careful in-
vestigation and collecte:. very complete production statistics and data.
He recommended that all single pants be put together, if oossible, under
one Code or division of one Code, on a. 36-hour basis, imder Cotton Garment
Code wages. If this should prove impractical , all wool pants should be
m,- de under the Men's Clothing Code and all cotton pants under the Cotton
Garment Code, at 34^ and 37^ minima and 36f!-hour maximum, and that men's
wash suits be produced under these same provisions.
5, Amendment to Cotton Garment Code — August 21, 1934.
Article III of the Cotton Garment Code required a report within
60 days as to whether the 40-hour week was resulting in sufficient in-
creased employment. Because this report had not been made, and because
the 40-hour weak of the Cotton Garment Industry had oeea subject to
much criticism and complaint from the other garment trades, a Public
Hearing wa.s called for June 18, 1934, to consider reducing the hours
to 36 end also to consider the applications of the Men's Clothing Code
Authority and the Dress Code Authority for changes in definitions on
certain garments. The hearing continued for five days (the first two
days devoted to the hours question, the remainder to the overlap prob-
lem), and in view of the pronounced hostility of the Cotton Garment
manufacturers it was not deemed advisable to make further changes in
definitions, so no action was taken on the recommendations of Special
Administrator Bloch as. to pants and --ash suits.
A reduction in hours, however, was considered essential, so this
Amendment of August 21, 1934, without the approval or consent of the
Code Authority, placed the Cotton Garment Industry on a. 36-hour week
basis, with minimum weekly wage rates of $12.00 in the South and $13.00
9732
-22-
in the North, and raised piece rates by not less than 10$. This Amend-
ment was to become effective October 1, 1934. This equalization of
hours and wages should have been a most important factor in the settle-
ment of the unfair competitive situation between the two industries on
the -oroduction of pp.nts and wash suits.
However, due to the flood of protests received from the Cotton
Garment Industry, particularly the Southern manufacturer, two stays of
this Amendment were issued by the Adninistrrt ion, delaying the effec-
tive date until December lsto Then, on December 1, 1934, a certain
group of Cotton Garment manufacturers filed an injunction suit against
the National Recover:/ Adninistrr ti> n, seeking to restrain the enforce-
ment of the new minimum wage and 36-hour week provisions. So that from
the approval date of this Amendment, August 21, 1934, until the termi-
nation of this' injunction suit on January 23, 1935, no actual progress
was made towards the settlement of this overlaying competitive contro-
versy between the two industries.
6. Developments from December 1, 19' ~A t to Supreme
Court Decision, Lfey 27, 1935.
However, the Administration, full?/ realizing the seriousness of the
situation and the need for some constructive action, worked on this pro-
blem continuously from August, 1934, on, and Deputy Administrators
Op jenheim and Greenberg devoted a great portion of their time to con-
ferences with Industry members and Code Authority members in an effort
to effect some solution.
: In October, 1954, Deputy Administrator Greenberg submitted a pro-
posal by which all wool pants should be made under the Llen'-s Clothing
Code and all cotton pants under the Cotton Garment Code, with equalized
working conditions as to hours and wages.
In November, Deauty Administrator Oopenheim drew up .an order,
similar in most respects to Depute Administrator Greenberg 1 s, and sub-
mitted it to the industries. The Southern rnanuf acturers, as usual, ob-
jected most strenuously, but the Associated Pants I lariuf acturers, repre-
senting the majority of Cotton Garment plants manufacturing semi-dress
pants, approved the pirn in most of its details.
No definite action could be taken ixntil the 36-hour week for the
Cotton Garment Industry was definitely made effective. But after the
termination of the injimction suit, Dewuty Administrator O'openheim
again submitted this pants order (with several other changes, includ-
ing a provision for an Exemwtioa Committee), and the Cotton Garment
Code Authority at their meeting on March 11, 1935, approved this order.
Southern manufacturers again wrotested vigorous ly, and action was
again held up. The Cotton Garment Code Authority, at its meeting on
April 30, 1935, appointed a committee to confer with the ken's Cloth-
ing Code Authority and work out the details of the order, so that same
could be nut into effect at the earliest possible date. ■
9782
-25- ■• -
In the meantime, Deputy Administrator Oopenhein, after conferring
with various Industry members, had suggested a further provision for
this order which would allow Cotton Garment olonts to make a small
percentage of their pants production of wool, and lien's Clothing plants
to make a percentage of their pants production of cotton, and still
operate under only their own Codes. ■
The majority of both industries ..-ere reacting so favorably to
these latest proposals that, at the tine of the Supreme Court decision,
it appeared to be only a quest ion of a few more weeks before these amend-
ments would have been officially approved md added to these Codes, and
this jurisdictional controversy over the production of single pants and
wash suits finally and definitely settled in r n-nner satisfactory to
all parties concerned.
The inequality of the hour and wage provisions, of course, was the
principal cruse of the controversy, and with incomplete definitions of
the garments in question in the original codes, conflict was bound to
occuri Some of the earlier changes madd, such as establishing different
wage rates for different fabrics, were approved, it -'ould seem, without
sufficient consideration of all an : ;les of the problem, and were soon
found impractical and impossible of enforcement; but the final solution
rlso, of course, was ouch easier to achieve after wages and hours had
been equalized.
9732
-24-
B. "Merchant And Custom Tailoring Industry.
In the minds of members of the Hen's Clothing Code-Authority and
the Administration there was some jurisdictional conflict "between the
definitions of the Merchant and Custom Tailoring Industry Code and the
Men*s Clothing Industry Code. On September 27, 1934, we find the
Administrator writing the Code Authority:
"You are doubtless aware that the definition of the in-
■ dustry in the Merchant and Custom Ts j.lors' Code and
the lien's Clothing Code are in conflict."*
"It appears that the Men's Clothing Code should "be
amended so that the definition of the industry will
exclude those who are included in the definition .of
the industry for the Merchant and Custom Tailors'
Code. Will you kindl3 r inform me what action has "been
taken or is contemplated "by the Code Authority in re-
gard to this amendment ? "
Also, as late as January 2, 1935, we find the Administration again
advising the Code Authority that the hearingscheduled for January 21
offers an opportunity to clear up differences "between the industries.
The Men's Clothing Code Authority had opposed the granting of a
code to the merchant tailors in the cutset, but seeing that such ob-
jections were to no avail, insisted that the Merchant and Custom Tailors'
Code provide a definition "so as not to allow anyone who is in fact a
'tailor to the trade, ' or in reality a manufacturer to come under the
provisions of that code. " **
The definition of the Merchant and Tailoring Industry as approved
on July 31, 1934, in attempting to arrive at a clear-cut distinction
between its membership and that of the Men's Clothing Industry, resorted
to a simple statement that "the industry is not intended to include members
of the Men's Clothing Industry generally known in that industry by the
terms of s tailor s-to~the~trade, ' 'wholesale tailors,' or 'direct to the
consider wholesale tailors,' or ' special order houses. 1 " This statement
or the need for the statement calls attention to the fact that there is
essentially little difference betwesn the operations and nature of the
business carried on by merchant tailors and the aforementioned groups
which belong to the Men's Clothing Industry. The essential but easily
confr.sed or misjudged difference appears to lie in the assumption that
the product of merchant tailors is almost entirely hand-made and hence
(*) Letter dated September 27, 1934, from M. D. Vincent,
Assistant De'outy Administrator, to David Drechsler,
Secretary, Man's Clothing Code Authority. (Men's
Clothing Code Files.)
(**) Men's Clothing Code Authority report of Committee on
Compliance and Enforcement, March 2, 1934. (Men's
Clothing Code Files.)
9782
-25-
of a superior quality and workmanship. *
On the bther hand, it is recognized that the Merchant and Custom
Tailoring definition' did attempt to exclude those recognized as owing
allegiance to the Hen's Clothing Code, while the definition of the Lien's
Clothing Industry was drawn so as to make no recognition or exclusion
of the Merchant and Custom Tailors.
This jurisdictional conflict was intensified hy the fact that
functionally the Merchant and Custom Tailoring Industry overlaps not
only with the Men's Clothing Industry, hut with the Retail Trade as
well,
"As a natter of fact, the average consumer is not aware,
in most cases, when he purchases a so-called 'custom-
made' suit, whether he is buying , f.rora the stock of the
retailer, from a merchant tailor, from a tailor-to-the-
trade house or a special order hoiise of the mass oro~
duct ion clothing factory. Actually, from the consumer's
viewpoint, \inless he h?A some actual acquaintance with
the industry, there is no substantial difference in the
assemblage of the garment which he purchases from any
one of the three sources mentioned above. Therefore,
it becomes apparent that any code definition of the Mer-
chant and Custom Tailoring Industry, must, of necessity,
be arbitrary; and being arbitrary, must engender hard-
ship and controversy somewhere. "**
The Amalgamated Clothing Workers of America, at public hearings
held January 27, 1934, in consideration of a proposed Merchant and
Custom Tailors' Code, through their representative, Hyman Blumberg
(member of the Men's Clothing Code Authority), objected to any pro-
posal establishing a difference between the tailor-to-the-trade houses
and the merchant tailors as defined in the code under consideration.
The tailor»to-the-trade houses were recognized definitely as being under
the Lien's Clothing Industry Code, but the point at issue so far as this
union representative was concerned was that certain workers under both
codes were 'doing similar work and to a certain extent were in direct
competition with each other, and hence were considered subject to
Amalgamated organization or affiliation if already organized. This
bond of economic interest uoon the part of workers in custom tailoring
shops and those -producing "ready-to-wear" clothing has been recognized
subsequent to the termination of the codes by the announcement of a
working agreement between the Amalgamated Clothing Workers and the
Journeyman ' s Tailors Union. ; .
(*)
approval of the. Merchant and Custom Tailoring Code.
See Approved Code ITo. 494,
(**) Code History Volume I, Page 89-91, Merchant and Custom
Tailoring Industry.
5732
-26- ■ -.
The jurisdictional dispute 'between the Hen's Clothing Industry
and the Merchant and Custom Tailoring Industry, it appears, sometimes
lead to the disorganization of entire market areas. As evidence of
this, attention is directed to the following extract from a letter of
complaint written May 7, 19!35>- to Morris Greenberg, Executive Director
of the Lien's Clothing Code Authority: by William Stanley, Executive
Secretary, Contracting Tailors Association^ of California.
"In this particular market, "because of the peculiar char-
acter of the "business, we have here conditions entirely
different from those in other sections of the country.;
"In San Francisco and Oakland there are a few merchant
end. custom tailors who for the reason that their, garments
are "being cut with the use of patterns cut for each in-
dividual customer and made according to the specifications
of the lierchant and- Custom Tailor irig Code, are really jus-
tified in operating under the jurisdiction of that code
and use its 'labels.
"With these few exceptions, the tailoring "business is
done principally by what are known as 'so-called merchant
tailors', who x in many instances cut their garments with
the use of- 'block patterns and- who in. every instance have
their garments made in contract shops where special ma-
chines are in operation,. These tailors should operate
under the jurisdiction of the Men's Clothing Code, "but
in some instances they do not recognize or abide by any
code and are continuing to free-lance. This is made pos- .
sible due to the fact that there are two codes in one in-
dustry and it allows, these tailors to switch from' one ' .
code-to the other and at the same time recognizing' neither.
This causes confusion and is very detrimental to the in-
dustry in general, especially as one code is "being en-
forced and the other is not."
C, Textile Examini n g. Shrinking, and Hefinishing Industry .
The Code for the Textile Examining, Shrinking, and Refinishing
Industry, approved August 6, 1934, concerns an industry which is
strictly of the service character -in its relations to the Hen's
Clothing Industry. The possibility of conflict of definition arose
from the fact tha.t certain clothing manufacturers performed in their
own shops the functions covered by the code definition for textile
examiners. The Textile Examiners' Code did not specifically exempt
operations carried on in clothing factories, yet it implied a cover-
age of independent establishments b~ r referring to operations on
"woolen and other woven fabrics owned by others." It appears at any
rate that difficulties arising between these two industries, if any,
were not brought to the attention of the .administration.
9782
- .7-
D. Shou lder Pad Manufact uring I ndastry and Slit Fabric
i " anuf ac txn i ng I ndus t r; r ,
730 th the Shoulder Pad Industry and the Slit Fabric Industry are
service industries to r.en's clothing manufacturing. As in the case of
te::tile shrinking, certain of the -or o ducts or processes performed
under these codes were likewise performed in the plants of men's
clothing manufacturers. In the case of these codes, however, the
men's clothing group influenced the writing of definitions of the
industries in question so as to i corporate the following qualifi-
cation: "Tie articles enumerated herein when made in clothing fac-
tories and used in connection with the garments manufactured in such
factories are exempted from the provisions of this code, "* In order
that production of shoulder pades outside and inside men's clothing
plants "be on the same competitive levels, the lien's Clothing Code
Authority also used its influence in obtaining for the Shoulder Pad
Code a maximum of 36 hours per week and one shift per day whereas
longer hours and two shifts had been proposed by the Industry, **
The Slit Fabric Industry Code likewise provided for one shift of
employees per day, but allowed 40 hours per week,
Z. Coat Front Manufacturing Industry.
A code for the -Coat Front Manufacturing Industry, supplemental
.to the lien's Clothing Industry Code, was submitted to the Administration
but was never approved. This code as revised for hearing on June 11,
1934, was designed .to cover the "Coat Front Industry, " The term "coat
front" was "defined to mean a combination of -some or all of the follow-
ing materials: canvas, hymo, haircloth and felt, for the purpose of
re— inforcing, shaping, and facilitating the tailoring of men's coats,"
The code definition likewise provided that such production of coat
fronts as took place in clothing establishments for use in garments
manufactured therein should be exempt from the Coat Front Code,
Negotiations respecting this supplemental code were carried on
for some time between its proponents and representatives of the Men's
Clothing Code Authority ...... The Committee on Compliance and Enforcement
of the Men's Clothing^Code Authority finally reported on March 2, 1934,
that a successful arrangement had been completed whereby the coat front
manufacturers agreed to come under the Men's Clothing Code, It was
arranged that the Men's Clothing Code Authority should supervise the
enforcement of this code in return for an income of one-tenth cent per
pair of fronts to be collected by the Coat Front Industry's Association,
(*) Report of Committee on Compliance and Enforcement of Men's
Clothing Code Authority, March 2, 1934. (Men's Clothing
Code files.)
. . f .
{**) Report of Committee on Compliance and Enforcement of Lien's
Clothing Code Authority, December 8, 1933. (Men's Cloth-
ing Code files. )
9732
-28-
Despite this seeming agreement "between the lien's Clothing Code
Authority and the coat front manufacturers, we find on November 9,
1934, the Empire Coat Front Association inquiring as to what the
Administration intended to do about including its membership with
that of the Hen's Clothing Code, stating that they still desired to
be included in such code "with appropriate exceptions similar to those
previously agreed upon." * This inquiry was acknowledged with the
advice, "We are making a special study of codifying small industries
and when finished shall be glad to consult with you," ** There appear
to have been no subsequent developments in the direction of codifying
the Coat' Front Manufacturing Industry. It is observed also that the
N,Il,A t files show no complaints arising from friction, if any, between
the Coat Front and the Lien's Clothing Industries.
F Infants' and Children's T7ear Industry .
As indicated by the definition of the lien's Clothing Industry, it
was provided that certain children's wearing apoarel (among which were
boys' Eton and Bugby suits) were to be manufactured under the Hen's
Clothing Industry Code. The proposed Infants' and Children's T/ear Code
originally claimed jurisdiction over the same products, but it was
finally provided that manufacturers of Eton and lugby suits might elect
to operate under the Infants' and Children's Wear Code, provided, how-
ever, that they comply with all the labor provisions of the lien's Cloth-
ing Code,*** It is clear that this arrangement was the outgrowth of
efforts upon the part of certain manufacturers to select the Code with
the most liberal labor provisions. The adequacy of the attempts to
solve this overlap problem would appear to depend on the degree" of com«~
plicnce obtained by the respective Code Authorities..
G, Knitted Outerwear Industry .
On June 1, 1934, the lien's Clothing Code Authority made a vigorous
protest against the proposal to amend the Knitted Outerwear Industry
Code definition to cover "the manufacturer of knitted outerwear apparel
for men and/or the manufacture of ski suits—whether knitted or made
of purchased knitted material or other material— etc. "**** The lien's
Clothing Code Authority Secretary took the position that "this amendment
seeks to take from the jurisdiction of the lien's* Clothing Code outer
(*) Letter dated November 9, 1934, to Morris Greenberg,
Deputy Administrator, from Lester Lyons, Secretary,
Empire State Coat Front Association, (iien.'s Clothing
Code Files).
(**) Letter dated November 20, 1934, to Lester Lyons,
from S, H. Ourbacker, Assistant De-outy Adminis-
trator. (Hen's Clothing Code Files, )
(***) Letter dated April 23, 1934, from John R. Beecroft,
Assistant Deputy Administrator, to George W, Elliott,
Chamber of Bommeree, Philadelphia, Pa. (lien's Clothing
Code Files. )
(****) Letter dated June 1, 1934, from David Drechsler, Secretary - !
9782 lien's Clothing Code Authority, to General Hugh S. Johnson,
(Hen's Clothing Code files under Code Classification 0-Z)
-29-
garnents which pre manufactured by the members of the Lien's Clothing
Industry under the Men's Clothing Code," The protest "is made formally
in behalf of the lien's Clothing Code Authority' — "on the ground that the
apparel quoted above, and made part of the proposed amendment, right—
fully belongs under the Men's Clothing Code."
This .jurisdictional dispute r 'as never entirely resolved it appears
u">on examining the opinions, of members of the Legal Division of K.M.A.
found in comments relative to the cla.ssifica.tion of a. firm "v/hich pur-
chases fitted cloth from knitting mills and then manufactured this
knitted cloth into men's and bo"rs ' sweaters,"
A member of the K.M.A. legal staff states with respect to the above
classification, "subject to confirmation by the Classification Division
•in Mashington":
"I have eicamined the Codes for Knitted Outerwear Indus-
try, hen's Clothing Industry and the Coat and Suit In-
' dustry in an effort to find the Code applicable to the
activities of the subject company. The Knitted Outer-
wear Code exoressl;. r provides that it does not include
the manufacture of garments made of purchased knitted
fabrics and the Code for the Men's Clothing Industry
a-^arently was intended to include only men's and boys'
suits, coats and pants.
n~_I doubt if there is any ao proved code applicable to
the activities of the subject company." *
„ review of this opinion by a member of the Legal Division of
N.R.A, attached to the lien's Clothing Indust^ Code reveals the comment:
"The definition of the irAoistr;" in the hen's Clothing
Code does not exoressly exclude or include sweaters,
such as mentioned in sa.id memorandum. However, I know
that the hen's Clothing Code Authority and nenbers of
the indu.st.ry would disclaim such sweaters because their
code is cc-.ifined to coats, vests, pants and overcoats,
and has never included any knitted garments or garments
made from knitted fabrics."**
hie last quoted ooinion would seem . to have added confusion to the
jurisdictional issues between men's clothing and knitted outer-'ecr, as
the hen's Clothing Code Authority did unqu.es tionably claim jurisdiction
over certain a;ooarel (a.s mentioned above) made of knitted materials and
produced for men and boys in men's clothing manufacturing establishments,
(*) Memorandum dated April 2d, 1935, from Travis hrown,
Counsel. (lien's Clothing Code files, Code Classifica-
tion 0-Z.
(**) Memorandum dated May 1, 1935, fro.: C. M. "right to
M. Z. Hwell. (Men's Clothing Code files, Code
Classification 0-2.)
9732
. -30-
H. Rainwear Division of the Rubber Industry.
The .uirisdictional disjute between the lien's: Clothing Industr; r and
the ?- inwear Division of the Riibber Industr^ was settled by a dminis trac-
tive Order 15-38. By way of ftu-ther explanation, it should be pointed
out that the Code Authority of the Rainwear Division of the Rubber Llanu-
factoring Industry claimed that certain garments manufactured of fabrics
knovn as cravenette, scotch mist, mist proof or similarly treated fabrics
which had been orocessed so as to be water-repellent belonged to the
Rainwear Division, The industries orroosed to this claim, including the
Men's Clothing Industry, contended that garments which do not include
"coating, backing, impregnating, or combining fabrics with rubber, or
gutta pertoha, paste or glue, should not be classed as rainwear," The
Administrative ruling contained in Order 15-38 specified that "clothing
when made of woven fabrics and sewn in the regular manner used in manu-
facturing clothing definitely belongs under the wearing apparel codes."
I. Army and Ifovy Clothing Factories.
The Lien's Clothing Code Authority was concerned with the fact that
clothing factories owned and oerated by the United States Government
through the ¥ar and iTavy Departments did not comply with standards set
up 'oj the Code of Fair Competition for the lien's Clothing Industry,
The views of the Code Authority are set forth in the following extracts
from two letters of protest from the Executive Director to the Admin-
istration,
"This is to inquire what action has been> taken by the
Rational Recovery Administration following our confer-
ence some few weeks ago with reference to the unfair
comoetition that is brought about in our industry by
the failure of both the Ar:^ and Havy to comply with
the lien's Clothing Code in the operation of their sev-
eral clothing factories,
"You will recall that I explained that this matter had
been taken up on several occasions in the past with va-
rious members of the ITational Recovery Administration's
staff, but seemingly nothing had ever been accomplished,"*
"I. repeat that it seems to me unnecessary to await Con-
gressional action because the President, as Commander-
in-Chief of the Array end iTavyj could issue an executive
order requiring not only clothing factories, but all
factories operated by the Government to work under and
observe the -orovisions of the codes applicable to the
products manufactured in any government-owned and oper-
ated plant. It probably would be well to include in
(*) Letter dated June 1, 1934, from George L. Bell,
Executive Director, lien's Clothing Code Authority,
to . John R.' Beecroft, Assistant Denity Adminis-
trator, (lien's Clothing Code files..)
9782
-31-
the order a clause to the effect that the War and Navy
Departments would not he required to "buy and use labels
on their products, although I personally "believe they
should he required to use such labels in order to popu-
larize the NRA label and make the entire public "label
conscious," It does seem to me most ominous, to be
very moderate in the use of the adjective, that the
Government plants should be working people at wages
end hours that are in direct contradiction to the whole
program of increasing employment and purchasing power,"*
J. International Clothing Designers.
A group known as the International Clothing Designers sought to
be. affiliated with the Hen's Clothing Industry Code and to become
subject to its jurisdiction and provisions. With respect to this
attempted alignment, there is found in the November 8, 1933, Limit es
of the Code Authority the following brief note:
"Mr, Drechsler read a communication and a petition
addressed to the Code Authority by the International
Clothing Designers. After a brief discussion, the
opinion of the meeting was to notify the Interna-
tional Clothing Designers Association that the lien's
Clothing Code made no provision for their inclusion
and that a letter be sent to them to that effect."
II RELATIONSHIP WITH OTHER INDUSTRIAL AND TRADE GROUPS
A, Piece Goods Division, Wool Textile ,
I... nuf ac tur i nr I ndus t r Tr
The lien's Clothing Industry as a purchaser of woolens is of course
intimately associated with and directly affected by the Wool Textile
Industry , especially -the Piece Goods Selling Division . It is not sur-
prising, then, to find some grounds for disagreement between these
industries in connection with proposed and adopted trade practices of
the Piece Goods Division of the Wool Textile Industry, For example,
the provision in the Piece Goods trade practices that "all freight,
express and delivery charges shall be paid by or charged as a separate
item to the buyer, " represented a break from the traditional practice
of (tooting goods on a delivered price basis. The men's clothing mahur*
facturers, as well as other apparel industries ooncerned, argued that
this new procedure required the purchaser to pay numerous separate
charges which could not be accurately figured in the calculation of the
cost of the goods. This was caused in part, it was asserted, by the
inability of the small, none too well organized manufacturers to handle
the new problems from an administrative and accounting standpoint,**
(*) Letter dated July 3, 1934, from George L. Bell, Executive
Director, Hen's Clothing Code Authority, to John R. Beecroft,
Assistant Deouty Administrator. (Aen's Clothing Code files)
(**) Transcript of Hearing on the Wool Textile Industry, January 11,
1935. Pages 4 and 5, (Code Records).
9782
-32-
Further, the Piece Goods Division of the Wool Textile Code provided for
somewhat rigid terms and restrictions on the granting of discounts. This
new practice from the standpoint of the buyer meant increasing difficul-
ties in the matter of adjusting losses from examining and sponging 'and
loss of yardage through shrinkage to the computation of the market price
on the new semi-rigid discount basis. ( *)
Frequent conferences were held "between members of the Lien' s Cloth-
ing Code and those of the Wool Textile group. There is no record, how-
ever, of final adjustment of the problems arising out of changes in trade
practices ~by -provisions in the wool Textile Code.
B. Retail and Wh o lesale Trade .
The Lien's Clothing Industry as a. seller of goods ran into serious
difficulties in connection with attempting to establish trade practices
relating to discounts, anticipations, f.o.b. shipments, standard sales,
etc. Just as the Men' s Clothing Code Authorit2^ was unsuccessful in gett-
ing adjustments, as buyers, with the woolen people, so in turn, no satis-
factory agreements were reached with the buyers of men' s clothing. The
nautr of the controversy between retailers and wholesalers and the Men' s
Clothing Industry will be discussed somewhat at length in the chapter on
"Trade Practices." The history of this conflict of interest is in a
large mea.sure the history of the attempt of the Lien's Clothing Code
Authority to amend their own fair trade 'practice provisions.
III. BRIEF HISTORICAL SKETCH 01? DE7EL0F1 LEFT OP THE MSN' 5 READY-MADE
CLOTIIIivG IHDUSTEY (**)
During the Colonial period of American history most urban people
made their clothing at home from cloth bought at stores or bought
second-hand clothing from dealers in old clothing. The prevalence of
home manufacture is evidenced by Alexander Hamilton's Report on Manufac-
turers, presented to Congress in 1791, which states: "It is computed
in a number of districts that two-thirds, three-fourths, and even four-
fifths of all the clothing of the inhabitants are made by themselves. "
This condition seems to have existed down through the first two decades
of the nineteenth century.
The well-to-do part of the population either imported its clothing
from England or imported cloth which was made up by itinerant tailors.
With the growth of villages and towns, some of the itinerant tailors set
up shops. The tailor, with the aid of his wife, apprentice, and journey-
men, often tailored garments from goods furnished by customers.
A. Ready -Made Garments .
The men' s ready-made garment industry started in the custom tailor-
ing shop. The seasonal character of the trade gave incentive for the pro-
duction for stock in order to keep employees busy. Hejected garments
(*) Transcript of Hearing on the 'Tool Textile Industry, January 11,
1935, Page 5. (Code Records)
.(**) Extracts are from "The Amalgamated Clothing Workers of America" by
Charles E. Zaretz (a comprehensive and well-authenticated study)
(New York, 1934.) ' *
9782
-OCr-
found their way to the display shelves. -Additionally the custom tailor
took over the functions of the second-hand clothing dealer who had already
extablished markets and methods of trading.
The increase in traveling in the earl 1 / part of the nineteenth cen-
turv caused by improved means of transportation stimulated a demand for
read^-made garments. The levying of a 50 per cent ir.roort duty upon cloth
in 1832 brought about an expansion of the home industry. Clothing es-
tablishments employing 300 to 50^ workers appeared in New Yorh, Philadel-
phia, and Baltimore. In most of these establishments garments were cut
and materials assembled, and then riven out to women who made garments at
home — the beginning of the sweating system in this Industry in the United
States.
The manufacture of ready-made clothing had become by 1B50 an impor-
tant industry. 'The seventh census of the United States, 1850, reports:
"There were 4,278 establishments employing 35,151 male and 61,500 female
workers. The invested capital amounted to $12,509,000. The amounts
spent for wages and materials were $15,032,000, and $25,730,000, respect-
ively, and the value of the products amounted to $48,311,000." There
were no factories in the oresent da;/- sense. The manufacturing establish-
ments were engaged in assembling of materials, cutting and selling of the
garments, while the sewing and finishing of the goods was done outside.
The em-olo^ees were English, Irish, and German tailors who were trained
in their native lands.
3 . Development of the Factor^ System
The invention of the sewing machine by Elias Howe in 1846 and its
perfection b^ Isaac M* Singer in 1351 were the chief stimuli to the de-
velopment of the factory system in. the clothing industry. The old sys-
tem of giving out work for completion in homes gave way to the concen-
tration of workers in shops and factories. The ease with which one
could learn to operate a sewing machine enabled a great number of un-
skilled persons to enter the garment industries. The newly-arrived
immigrant readily found a place in the industry, although previously un-
trained, and in fact, began to displace the skilled tailor who had spent
3^ears in acquiring the art.
The sewing machine was a great improvement over the old method of
sewing by hand and soon after its invention clothing shops began to fill
the Ghetto districts of New York, Boston, and Philadelphia, the 'centers
of the ready-made clothing industry. The effect of the sewing machine
u on the clothing industry is well described by a writer in 1850 who
states: "Among the branches of industry which have been signally advanc-
ed especially by the introduction of the sewing machine is the "manufac-
ture of men's and women's clothing for sale, which has heretofore ranked
with the cotton manufactures in the number of hands (two-thirds of them
female) and the cost of labor employed. The increase of this manufac-
ture has been general throughout the Union, and in the four cities of
Hew York, Philadelphia, -Cincinnati, and Boston amounted in value to 40
and one-quarter millions of dollars, or over r cent of the product
of the whole Union in 1850. "
The Census of Manufactures (Eighth Census, 1350) gives the size of
ready-ma.de clothing industry in its four largest centers as follows:
9782
-=34-=
Number of Number of 'workers
City
Esta
blishments
Male".
Female
Value of Products
New York
303
10,954
10,624
$17,011,375
Philadelphia
352
6,309
8,078
9,984,497
Cincinnati
222
5,016
4,965
6,381,196
Boston
61
1,324
2, 693
4,567,749
C. Civi
1 tfar
Stimulus to
Factory
System.
The demand for arn^ clothing during the Civil T Jar could not be
supplied by the old type clothing shop, and '..he Government had to pxirchase
some clothing from abroad. The Government set up its own shops and also
gave large contracts to private concerns. Report No. 33 of the U. S. •
Bureau of Foreign and Domestic Commerce states that at first the uniforms
were, made at the homes of workers, but as the war went on a large number
of shops '"ere set up to fill army contracts. In connection with the
manufacture of loniforms an important discover 1 ' - to the industry was made.
It was learned that there is a close relationship between the different
parts of the male figure. For instance, it was observed that men who
have a 40-inch chest usually have a 36-inch waist and legs 31 inches on
the inseam, and that for every chest size there was a corresponding waist
and leg size. This discovery of size relationship made factory production
on a large scale possible.
After the Civil "ar many of the newly-formed shops a~nd factories
turned their attention to civilian clothing. The reouirements of sol-
diers now returned to civil life and the acceleration given trade and.
commerce in general by the opening up of the South and 7est created in-
creasing demands for ready-made clotning, which the industry met with
difficulty for a. time, despite improvements in methods, and technology.
Chicago and St. Louis became import. -nt clothing centers in the Mid-West,
and the industry gained a considerable foothold in New Orleans, in the
South. In 1879, the Hart, Schaffner & Marx firm, the largest clothing
establishment in the United States and doubtless in the world, was
founded as Hart, Abt & Marx.. In 1887, Mr. Levi Abt withdrew from, and
Mr. Josewh Schaffner joined, the organization, forming the partnership
of Hart, Schaffner & Marx. The firm was incorporated in 1911.
17. PRESENT BAY SCOPE OP MEN'S CLOTHING INDUSTRY.
A. Number of Establishments .
The Code Authority for the Lien's Clothing Inudstry estimated that
there were 3,225 establishments in the Industry during the Spring season
of 1935. This is an estimate of regular factories and contract shops,
and represents an increase of slightly more than 1,000 establishments
over the 1933 total of 2,219, but falls 463 short of the 1929 total of
3,691. Attention is directed to the table immediately following, which
gives for the -/ears 1923, 1925, 1927, .1329, 1931, 1933, and 1935 the
number of clothing manufacturing establishments in the United States
which could be classed as belonging to the Hen's Clothing Industry as
aualified by the codal definition for this Industry.
Mr. H. K. Her.vitz, Comptroller of the Jen's Clothing Code Authority
has estimated that no one member of the Industry produces more than 3
per cent of the volume of the Industry. A study by the same individual
likewise reveals tha.t a. list of the 50 largest producers would range down
9732
-35-
to include those firms which produce .3 of 1 per cent of the Industry
vo lume .
TABLE I
Number of Establishments in the "en's C lothing Industry :
5egulr r Factories and Con tract, Shoos
* -
Regular
Year
Factories
1923
1925
1927
2, 044
1929
2,157
1931
1,802
1933
1,470
1935
;•
Contract
Shop s
1,518
1,524
1,143
749
Total
Establishments
4,024
3,491
3, 562
3,691
2, 945
2, 219
3, 225
!a/
Source: Census of Manufactures, 1029, 1931, 1933; figures for 1935
from Men's Clothing Code Autnorit}?-.
a/ Due to chans.es in Census classifications, 1933 figures
are not strictly comparable with those for -previous yerrs.
S . Distribution of Establishments .
The distribution of the establishments in the Industry by States for
the years 1929, 1S31, and 1935, is indicated by Table II ( *) . It can be
readily seen that a very few States; namely, New York, Illinois, Maryland,
Massachusetts,. New Jersev, and Pennsylvania; account for the major portion
of the Industry's establishments; to be er'act, 88.6 per cent of the 1935
total. This heavy concentration of establishments is to be found in the
cities of New York, Chicago,' Boston, Philadelphia, Rochester, and Baltimore,
which have been centers of the Industry since its early development. It
is of interest to note that Tew York State alone accounts for approximately
50 per cent of the productive units in the Industry. This is accounted for
by the large number of small contract shops found in the New York City area.
Yet, a.s shown _ by Table III, percentage of Total Garments Cut, by Principal
States, New York State also accounts for an outstandingly high percentage
of the garments cut.
Attention is drawn to the fact, as shown by Table II, that the New
York area and likewise the Illinois area lost establishments in relation
to the total during the period from 1929 to 1931, but reestablished a more
favorable ratio ~by 1935. New York, in fact, exceeded its 1929 percentage
of establishments in 1935 by 1 per cent of the total, having registered a
rather large gain of 2.4 per cent of the total for the Industry between the
years 1931 and 1935. A striking gain of 4.3 per cent of establishments is
shown by Maryland in the years between 192 - 1935.
(*) For a distribution of establishments among trie principal States for
the years 1923, 1925, 1927, s?e ~- iM •. s V, VI, VII.
9782
—36—
TABLE II
BOMBER ALU) PER CENT 0? PRODUCTIVE UNITS III SPECIPI3D STATES^/
State
1929
1931
1935
Per
Per
Per
Number
cent
Number
cent
lumber
cent
United States
Total
3,591
100.0
2,945
100
3.
,225
100.0
California
88
2.4
54
2.2
105
Colorado
5
0.1
5
0.2
3
0.1
Connecticut
<^L
0.8
16
0.5
7
0.2
Georgia
7
0.2
8
0.3
5
0.2
Illinois
319
8.6
204
6.9
269
8.3
Indiana
25
0.7
18
0.6
5
0.2
Kentucky
24
0.7
18
0.6
1®
0.3
Louisiana
17
0.5
19
0.6
17
0.5
Maine
9
0.2
7
0.2
5
0.2
Maryland
217
5.9
257
8.7
329
10.2
Massachusetts
161
4.4
146
5.0
117
3.5
Michigan
22
0.6
13
0.4
10
0.3
Minnesota
4-6
1.2
40
1.4
19
0.6
Missouri
72
2.0
65
2.2
27
0.8
New Hampshire
5
0.1
3
0.1
2
0.1
New Jersey
168
4.6
145
4.9
190
5.9
New York
1,817
49.2
1,404
47.8
1
,622
50.2
Ohio
130
3.5
102
3.5
97
3.0
Pennsylvania
384
10.4
317
10.7
335
10.4
Tennessee •
11
0.3
10
0.3
7
0.2
Texas
18
0.5
11
0.4
3
0.1
Virginia
17
0.5
11
0.4
5
0.2
Washington
9
0.2
F"3
(
0.2
3
0.1
Wisconsin
37
1.0
28
1.0
19
0.6
Other- States
53
1.4
27
0.9
13
0.4
Source: Census
cf lianufc
ctures,
"Ken 1 s
Clothing;
" 19-35 figures
estimate!
by the Code Authority for Men's Clothing Industry
a/ Regular factories and contract shops combined.
9782
-37-
C . G arments Cut by Principal States .
The percentage of garments cut by States is a good index of the dis-
tribution of the Hen's Clothing Industry throughout the United States.
Attention is directed to Table III, which indicates the Percentage of Gar-
ments Cut, by Principal States, for the year 1934. The States leading in
garments cut are New York, Pennsylv;:mia, Illinois; Ohio, Maryland, and
Massachusetts. The Stake of blew Yovfc i f : outstaadvog in accounting for
46.2 per cent of the total garments cut in tne Industry for 1934.
D. T7age Earners in the Ind.ip tyy.
Tfage earners in the Men's Clothing Industry approximated 150,000
employees in 19 ?3. Employees ii tie Industry declined sharply from the
high in 1923, with the exception of c reversal in trend for the years 1927
and 1929, to a low of approximately 119,000 in 1933. A comparison of the
number of vrge earners in the ken's Clothing Industry with all other manu-
facturing industries (See Table IV), indicates little change in relative
positions from 1923 to 1933. Men's Clothing represented 1.8 per cent of
all other manufacturing industries in 1923 and 2.0 per cent in 1933. A
distribution of wage earners in the Industry by States for the years 1923,
1925, 1927, 1929, 1931, and 1933 is found in Tables V, VI, VII, VIII, IX,
and X respectively. The clothing centers found in the States of New York,
Pennsylvania, Illinois, Maryland, Massachusetts, and Ohio maintained their
predominance in numbers employed over this ten-year period. A significant
trend is noticed over this period in the shift of employees from the States
of New York and Illinois and the gain in employees by the States of Penn-
sylvania and Maryland. This appears to represent a shift in manufacturing
activity within the Industry from large metropolitan centers to towns and
cities of smaller populations. (*)
E. Value and Volume of Production .
The principal products produced under the Men's Clothing Industry
Code were: men's suits, whooly or pertly wool, mohair, and linen; men's
separate trousers; men's overcoats and topcoats; men's odd coats; boys'
suits, wool cotton, etc.; boys' separate ponts; boys' overcoats; boys'
mackinaws, reefers, and light coats; and uniforms.
The volume and value of production of men's clothing for the Censxis
years 1923, 1925, 1927, 1929, 1931, and 1933, together with estimates for
1934 made by the Code Authority, is shown in Table XI. Value of garments
produced declined by more than half from 1923 to 1934, as evidenced by the
totals of $936,787,000 and $397,876,000 respectively. The decline in value
of garments produced was unbroken in the eleven-year period from 1923 to
1934. Total values for 1934 slightly exceeded the value of 1933 when
allor/ance is made for uniforms. The Men's Clothing Code Authority esti-
mated that the 1934 production of uniforms was about the same as for 1933
and that the value at 1934 prices would be from $9,500,000 to $10,000,000,
(*) Further statistical evidence of this trend will be found in a more
detailed study of migration in the Industry found in Chapter II,
Section VIII.
9782
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-45-
TAiiLE III
PERCENTAGE' OF TOTAL GARMENTS CUT, BY PRINCIPAL STATES, 1934
State
Per Cent Volume of Production
of Total (Thousand Garments)
Value of Production
(in thousands)
U. S. Total
California
Georgia
Illinois
Indiana
Kentucky
Louisiana
Maryland
Massachusetts
Minnesota
Mi ssouri
Not Jersey-
rev York State
Ohio
Oregon
Pennsylvania
Puerto Rico
Tennessee
Virginia
Wisconsin
Other Strtes
100.0
.4
1.2
9.1
.9
.7
1.5
7.2
4.1
.3
2a
.7
45.2
11.2
.1
11.7
.1
1.2
.7
.4
.2
45,
,323
195
548
4,
,133
421
308
671
'7
o
,263
1
,345
113
970
317
20,
,998
5,
,062
32
5
,312
32
526
295
159
123
$397,876
1,711
4,814
36,286
3,700
2,706
5,889
28 , 647
16,194
995
8,514
2,785
184,336
44,443
279
46,631
279
4,615
2,586
1,392
1,074
Source: Code Authority for Lien's Clothing Industry.
9782
-46-
making a grand total value for all garments of approximately $407,000,000
for 1934 as against tho 1933 total value of $401,711,000.
Zigures on total number of garments produced in the Men's Clothing
Industry are not available for the years 1923 and 1925. Eron the year
1927, with the exception of 1929, the number of garments produced declined
sharply until 1934, when an improvement over 1933 was registered. The
decline in volume from the high figure of 75,795,000 in 1929 to the low
point of 36,940,000 represented a shrinkage of approximately 52 per cent.
The recovery in 1934 over 1933 in turn v/as very substpntial, as evidenced
by the volume of 43,171,000 garments for 1934, as against 35,940,000 for
1933.
TABLE
MEN 1 S CLOTHING- INDUSTRY
Number of Wage Earners in the Men's Clothing Industry Com-
" pared with that in All Other Manufacturing Industries
1923 - 1933
Men' s
All
Manufac
turing
P<
srcentage Men' s
Year
Clothing
Industries
Less
Cl<
3 thing is of All
Industry a/
( ThousE
mds
Hen
' s Clothing:
Other
Manufac tur i ng
of Workers)
ldus tries
1923
158
8,520
1.8
1925
142
8,242
1.7
1927
146
8,204
•
1.8
1929
150
8,689
1.7
1931
122
6,401
1.9
1933
s/
119
5,935
2.C
SOURCE: Census of Manufactures, 1929, Vol. II, pp. 15 and 356; 1931, p.
20; 1933, bearing Apparel, p. 5; mimeographed release, January
23, 1935, p. 1.
a/ Data are for Census classification "Clothing (Except Work Clothing),
Men's, Youths', and Boys', Mot Elsewhere Classified." They do not
include establishments with annual production valued at less than
$5,000.
b/ The figures for 1933 are not strictlv comparable with those for
previous j^ears, because of changes in Census classifications.
Prepared by
Industry Statistics Unit
Statistics Section
Division of Review, N.R.A.
9782
-4,-
• CHAPTER II
CHARACTERISTICS OP THE IEDUSTBY
I. OHG&iTIZATIOi: 0" PRODUCTION
A. Types of "^stallish icnts
There are .two distinct t^npes of fins in the Ten's Clothing
Industry. First, there are establishments which buy material, out the
cloth, market the finished mroduct, finance production from rati materials
to finished ganents, "but which often do not own and operate the plant
where the garments are made. Secondly, there are establishments called
"contract shops" or contractors who take cut cloth and accessories from
one who finances the business and perforn the remaining operations ne-
cessary to completing the garment on a piece price basis. (*) This
contractor is ordinarily responsible for his ovn force of worsen and
usually owns machinery and a '-orkroom, Until the Code went into effect,
a substantial part of the work war. done on a, hone work basis, in r- hich
labor was performed in the homes of the employees themselves, and not
in a factory o^ned and conducted by the employers.
In a few cities, including Chicago, Rochester, Cleveland, and
St. Louis, most production is found, in shops which complete the entire
garment. In other cities, of which I T ew York is the most significant,
the work for the most part is conducted in contract shops, having been
let out by the manufacturers who cut the cloth and who, as above described,
finance the entire procesr. The areas (not clearly defined) which employ
the practice and use of the contract shop 'method of production are some~
times referred to as the "centralized areas" as distinguished from the
plants, ordinarily found in small towns and cities, which -nrodtzce the
entire ga.rment, and are described as the "decentralized areas." It is
emphasized for certain purposes that the plants in the "decentralized
areas" are highljr integrated and usually employ highly sub-divided pro-
cesses of manufacture.
In addtion to these two types of establishments which a.re
most prevalent in the Ren's Clothing Industry, there are found other
classifications of considerable importance. They are as follows:
1. The I'anufacturer-Distributor.
This t3poe of establishment , in addition to the manufacturing
plant, owns and ome rates selling outlets through which it disposes: of its
products direct to consumers. This distributing function is done either
through ownership of chaines of clothing stores or by mail orcer sales.
(*) Tor a breakdown of establishments between regular factories
and contract shops, see Table I
S782
-48-
2. The "Integrated" Manufacturer.
In this type of esta.hlishn.ent the entire manufacturing pro-
cess is usually carried out in one plant under a single management
T'hich also sells the product to wholesaler or retailers.
3. The Tailor-to-the~Tre.de Establishment.
This type of establishment manufactures under factory methods
clothing taken on order from retailers. The retailer either specializes
in a special size, style end quality or takes orders from customers on
a made-to-measure basis. The "special-order" houses met this demand ~by
having developed an ability to produce special order garments a/t factory
costs.
3. Technology .
The division of labor first developed in the Clothing Industry
by German tailors around the middle of the nineteenth century has develop-
ed in some of the present day manufacturing establishments until there
are as many as 16S operations in the mailing of an overcoat. This develop-
ment has me.de for greater efficiency in terms of labor output and has
made possible the utilization of labor of varying degrees of skill. (*)
While there are many operations in the making of a. garment,
depending in part upon the type of manufacture em-oloved, these operations
can be divided into a feu distinct occupational grouos, the principal
groups being putters, fitters, searing machine operators, pressers, basters,
hand severs, shapers, bushelers, and tailors. (**)
Despite much progress in division of labor in the ken's Cloth-
ing Industry, the advantages of large scale production do not appear very
significant. The machinery, and 1 the methods of production do not vary
greatly between the small and large establishments. A shop employing
fifty people is likely to be found as efficient as a shop employing one
thousand. (***)
(*) I.iartin E. Popkin, "Organisation, Management, and Technology
in the Manufacture of ken's Clothing." ' (lTev York, 1929).
Page 257.
(**) Bureau of Labor Statistics, "Wages and Hours of Labor in the
ken's Clothing Industry, 1911 to 1930. (Bulletin 557)
(***) Charles E. Zaretz, "The Amalgamated Clothing Workers of
America." (ke" York, 1934.) Page 23
J73;
-49-
1. Machine ry
The last half of the nineteenth century witnessed the in-
troduction of several ne - .' machines into the ready-made clothing industry,
resulting in a radical departure from old methods of -orod.uction. (*)
The early sewing nachines which had a speed of between 800
and 900 stitches per minute, upon the adoption of mechanical oower were
made to operrte at the rate of 1,200 to 1,500 stitches wer minute, and
by the year 1900 had attained a speed of 4,000 stitches wer minute.
In 1870 the cutting shears, were replaced by the knife which
could be operated by one person and could exit through 18 or more thick-
nesses of cloth. In 1872, the pover cutting machine was invented by
Albion and Y.'rath of Staten Island. This machine ras operated by steam
and consisted of a reciprocating vertical blade. Such cutting machines
have been successively improved. The first electrically run vertical
blade machine, which cuts a maximum thickness of 1-g inches of cloth, was
turned out ~o~/ the Eastman Co. in 1897.
Gas pressing irons were introduced, around 1903. These displaced
the method of heating irons on a stove or by charcoal. There are now many
kinds of pressing machines on the market heated by a compound of air and
gas. The method of operation usually provides for a foot-pedal movement
which assures by utilizing the weight of the presser, sufficient m-essure
for the heaviest garment.
Machines for buttonhole-making, button-sewing, pocket-making,
cloth examining, sponging, and others have been developed to a high degree
of efficiency.
The manner in which' the adaptation of machinery to the clothing
industry has simplified, the processes of manufacture and has increased,
the efficiency of the manufacturing establishment can be appreciated by
brief glimpse at the methods employed in a present day establishment.
Following is a resume of the description of the orincipal operations in
a modern establishment which "produces between 6,500 to 7,000 -suits psr
week and employs from 650 to 675 employees": (**)
(*) Charles E. Zaretz,' "The Amalgamated Clothing Workers of America."
(New York, 1934) page 20.
(**) M. E. Eosenmond, "Lias's Production Cuts Costs in Manufacture
of ken's Suits." (Manufacturing Industries, July, 1927, Volume
14, Pages 60-6.1.)
9782
-50-
The departments are so coordinated that if one fa?.ls "behind
it has to v:orh overt ime in order that the entire plant, is
not held up on the following day. Around 6,000 yards of
roolens are used ner day. Tool ens, on delivery, are in-
spected, measured; and rewound, Woolens are then sponged
a\id. shrunk in a machine large enough to handle the company' s
requirements. After shrinking, the cloth is rewound "by a
machine which also folds it lengthwise.
Cloth is layed on cutting tables (four, 100 feet long, and
.six, 60 feet long). As many as 40 double thicknesses of
cloth are piled one on another. One man lays out, another
chalks the patterns on a marker, a third puts the marker
on the pile, and a fourth cuts the lay rith electrically
driven cutting machines. A trimming department does the
some rith the linings. The separate piles are taken to
the thicketing department, where the different parts are
raa.tched for shade, size, lot and corresponding numbers
are sewed on each to assure proper assembly. The bundle
of parts (coats) are fitted up and are given out for
sewing- together.
In the coat-gewing room are 400 sewing machines. Each
croeratrr ;sews only one team. The different garments pass
through the room in a steady stream. Pockets and -oocket
facings are put together and sewed in another part of the
room. A battery of 14 ironers iDress out und.erseams with
perforated flat irons (gas-heated) served vf ith steam, which
is forced through the bottom of the iron through the cloth.
Steam and gas are piped directly to the ironing tables.
Canvas fronts are basted on b; r hand and blind-stitched by
machine. Two power-driven button-hole machines each cut
and sew over 600 holes daily. One sews, then cuts; the
other reverses the process by cutting, then sewing. 3ast~
* ings are removed in the cleaning department. The final pro-
cess is that of inspection.
Tor pants, practically the same system is used. The pants
depart lent has 100 sewing machines and each worker does a
single specific job. Here are four power-driven button-
'. sewing machines. One man with one machine sews buttons on
between 500 and 600 pairs of pants per 6^y. Also, there are
three button-hole machines and twelve gas-fired steam irons
for underseams. The pants department has twelve Hoffman
pressers. (The two parts of the Hoffman presser are per-
forated so tha.t when the garment is laid between and pressure
applied, steam can be forced through-' the upper half and. wet
cloth, and. suction draws the steam and noistenc through cloth
and. lower half.)
The coat-pressing department has 58 Hoffman pressBrs. Each
coat posses through seven press ers, each operator 'Dressing
only o ie part .
Vests are made in a separate plant.
9782
-51-
II. FIMLTC1AI ASFFCTS OF THE I1FDUSTFY (*)
A. Investment in Industry
Ho statistics pre available to portray accurately the relative
standing of the Fen's Clothing Industry from the viewpoint of capital
investment. Inferentia ly, it na ,r be determined by applying an accent-
able ratio of capital turnover to volume, based upon an e::perience average
obtained from a study of known operations of representative groups. Fy
this process approximately a 4 tines turnover appears applicable to the
year 1934, and an aggregate capital investment in the Industry may be
conservatively estimated at not less than ?100, 000,000, notwithstanding
the inroads on capital during the depression years.
B. Fortalit-
In five primary divisions of the Apparel Industry, manufacturers
of men's wear, of which clothing as contemplated vithin this study is of
major importance, ranked in the central position as reflected in the per-
centage of failures in proportion to the number of concerns operating in
the three '"■errs prior to 1931.
Arranged in order of highest average failures in those years,
the records of the broad industry subdivisions are: (**)
1928 1959 1930
Manufacturers - Coats and Suits - 5.2fo 5.7fo 7 ,9fo
Manufacturers - Dresses and Ensembles - 4.2 4.9 8.3
Manufacturers - Fen's Fear - 3.2 2.3 5.5
Wholesalers - Dry and Knit Goods - 2.2 2.9 3.3
miscellaneous Cottons - 1»6 1.3 2.4
(*) Adapted from a survey made by A. A. Fisher (N.F..A. staff) during
the fall of 1935. In view of the limited statistical data avail-
able on certain financial aspects and problems of the Industry con-
sidered herein, it was necessary for Fr. Fisher to rely principally
upon authoritative statements made to him during a personal survey
in New YorF. "Highly qualified and responsible sources contributed
freely from their ovni studies and experience, with the implied
understanding that nanes of individuals and institutions consulted
rrould not be recorded unless specifically authorized. Those consulted
were outstanding members of the Industry, trade association executives,
bankers, factors' credit officers, and certified public accountants,
especially conversant with the manufacturers 1 financial problems."
(A. A. Fisher)
(**) Twelve Discussions on Fun da >vF'. r Is ->:' Credit . ;':. G-. Dun
and Company, New Fork, 1S31, p. 15.
?782
-53--
While the foregoing indicates an increase in percentages of
failures in the men's wear group to 5,5$ in 1930, it must be understood
that included therein were manufacturers of shirts, underwear, pajamas,
etc. TToolen outer—clothing is the outstanding product of men's clothing
manufacturers, with which this study is concerned, and their failures
in proportion to number in the Industry are recorded at 7^ in 1930, 8fo
in 1931, and higher in 1932. (*)
Stable as the Lien's Clothing Industry is, compared '-'ith the
more volatile women's garment industries, - infinitely more sensitive
to the vagaries of style, - a fairly high mortality has evidenced itself
in recent years. The number of financial embarrassments, resulting in
bankruptcies, assignments, or liquidations by trustees, began increasing
in the last quarter of 1929, and the trend continued throughout 1932.
(**) A substantial drop in failures occurred in 1933 and remained about
static during the period of the codes, with some increase noted during
the first half of 1935 over the same period of the preceding year.
With new concerns constantly entering the field to fill the
gaps, it is estimated that the business life of the average manufacturing
unit in the lien's Clothing Industry in seven years. The cause of failure —
whether by bankruptcy, or voluntary liquidation by reason of losses and
discouragement— is,, in the varjt majority of cases, a profound lack of
ability on J :he part of management. It takes more than a good cutter and
an able salesman to operate successfully in the clothing business. One
or the other, or a third member of the firm, should be a capable executive
experienced in financial management, or the enterprise is foredoomed to
failure. A contributing cause of failure may be inadequate capital;
but here again, efficient management would live kept a tighter control
over what caoital was available and trimmed sails accordingly.
(*) See Table XII, indicating a quarterly record of number of
business embarrassments and the amount of liabilities of
men's clothing manufacturers covering the period from 1928
through the second quarter of 1935, prepared from data
supplied by the Research Department, National Credit Office,
Inc. , Hew York.
(**) See Table XII.
9782
-F5
do-
table xii
Men's Clothing Manufacturers
ITumber of Business Embarrassments (*)
(Bankruptcies - Assignments - Trustees)
<fo of Total
Year
1st Qu.
2nd Qu.
3rd Qu.
4th ■ Qu.
Total
in Industry
1°23
18
20
14
33
85
3.83
1929
15
11
8
24
58
2.6'
1930
49
32
17
34
132
7.0
1931
35
24
53
61
153
8.0
1932
56
39
52
41
168
1953
15
25
11
9
60
1954
o
4
10
11
34
1935
15
11
Amount of Liabilities in Embarrassments (*)
(000 omitte'd)
1928
$880
SI ,010
$625
$1,420
$3,935
1929
722
941
217
1 , 600 '
3,480
1930
3,727
2,175
590
2,018
8,510
1931
1 , 890
827
1,730
2,555
7,002
1932
2,754
2,992
1,742
957
8,455
1933
374
596
182
212
1,364
1934
334
60
346
. 240
980
1935
230
250
(*) (*) Source: Research Department, National Credit Office, In.
Ner- York City
9782
-54-
C. Ca pital and Tur nover.
As in other needle industries, there is practically no mini-
mum capital requirement for a manufacturing wholesaler of men's
clothing to set himself up in business. With a rented loft, a
pair of shears and a cutting table, a cutter and a salesman are
in business. Piece goods may be obtained on credit from a com-
mission house or jobber; samples" are cut and given to an outside
manufacturer, or contractor, who is paid for his labor. If the
samples are favorably received and orders result, more materials
are obtained on credit and the process repeated with the contrac-
tor. With no more than $2,000 to $5,000 capital such a small con-
cern, if commitments are limited to business obtained from sample
showing to sound retailers, may thrive in capable hands,
1. Contractor's Investment.
The investment of the contractor or sub-manufacturer
may be even lower than that of the wholesaling cutter. Some con-
tract shops hasre not over $500 invested in sewing machines, etc.
These may be rented or purchased second-hand. The cut material
is furnished by the wholesaler, who engages his services and pays
for the labor operations, including the contractor's overhead ex-
penses and profit, if any. The facility with which an experienced
operator may enter the garment manufacturing business on very
small capital gives him this election: If he has insufficient
funds to establish an inside shop, and still an amount inadequate
to form the base of a wholesaling cutter's credit with piece-
goods suppliers, then he becomes a. contractor. There are many
exceptions to the rule. The contractor may have a considerable
investment in his plant, and in some cases even assist in finan-
cing the manufacturer or cutter employing him, by not requiring
prompt payment of the weeklv labor payroll. Most of the larger
contract shops have been established in outlying districts adja-
cent to metropolitan areas, with lower rents and expectancy of
cheaper labor cost s. Without a comprehensive survey it would be
difficult to place an estimate on the average or total capital
employed by contractors in this Industry.
2. Manufacturer-Wholesaler's Investment Turnover.
Regular manufacturer-wholesalers are of two types: (a) Stock
Houses, which manufacture quantities for their own stock and sell
to retailers and jobbers as the goods are needed, and (b) Order
Houses which manufacture only against orders secured in advance
of the season. Most Stock Houses have their shops on their own
premises or under their immediate control. These are frequently
referred to as "iffiside" shops, as distinguished from the contrac-
tors' "outside" shops. Order Houses, though some may operate "in-
side" shops, usually restrict their manufacturing operations to
cutting and utilize the contractors' "outside" shops for making
the garments.
9782
-55-
Obviously the stock Houses' capital needs a.re greater to carry-
heavier inventories than are those of Order "-oases. So, too, the plant
.- investment in the inside shop requires a larger capital
than may be required by the manufacturer employing contractors or sub-
manufacturers •
To establish i side shop the . : n ;i' \cturer is unwip* to start
with less than 3 , 10. Even then his success is doubtful except under
most favorable c i Ltio s because oi inherent incidental expenses.
$75,300 is considered none too much to start on in this business. Turn-
in" his capital actively in each of two seasons, a siiccessful manufact-
urer may do a 6 ross volume of $600,000 on an investment of 675,000.
Tiie re are members of the Industry, however, manufacturing in their own
factories, who nave a total capital investment in excess of $10,000,000.
It is worthy of note that in the "boom" period -receding the recent
degression, a movement developed, aided by investment bankers, for con-
solidation oi various units ■••ifchin the Industry. Large scale production
v;ae expected to .ring increased profits through 'the advantages of hulk
purchasing, quantity production, national advertising, market study,
scientific sales methods, ana establishment of retail branches. Evident-
ly little consideration was given in this program to the disadvantage
cf tying up a considerable portion of capital in real estate and plant
equipment, which obviously slows down the turnover of total capital
at the risk oi business.
3. , Relationship of Sales Volume to Invested Capital.
Turnover to capital or net worth in the period prior to the
depression was considered in this Industry to average in the neigh-
borhood oi 7 times. (*) While some producers may do better than that
today, they are the exception. The concern of medium size appears to
have the advantage. A study of financial reports of 229 manufacturers,
each with sales less than $1,000,000, whose aggregate volume in 1933
amounted to 351,913,217, or an average of $226,717, (**)' indicates a
turnover of 3.7 times, nearly half of the theoretical average under
normal conditions. For this grouo a ratio to fixed investment is not
available. The rate of turnover seems to be in line, however, with 3.88
times, determined as the average of another grouping of 238 manufacturers
who in 1933 had an average fixed asset investment of 9.33$ of net worth.(***)
(* D. Richard Young, in article entitled "Profits in the Clothing
Industry," American Bankers Association Journal, June, 1923,
states II .tional Cre-cit Office calculates inventory turnover for
. factiirers of men's clothing at 7.24 times annually.
(**) Behind t he Scenes. of B usines s, hoy A. Fouke , Manager,
Analytical Report Department, Dun and Bradstreet, Inc.,
1935, pp. 144-145.
(***) Analysis of Percentages in Robert Morris Associates Statement
Studies, 1933.
9732
On the other hand n study of figures of 63 large concerns having a 37";
investment in fixed assets indicates a group turnover of only 2.75 times
net worth, (*)
The average ratio of profit to turnover varied only 4/10 of 1 per
cent in each of the studies cited, whereas the profit' to net worth
averaged* 9. 2$ in the first instance, 7,18$ in the second, and only 3.6^
for the smaller group of Larger manufacturers. In short, the large
firms had all the incidental worries of conducting a large "business
with a heavy fixed investment, "but did not secure a comparable return.
The effect of the N.I.Ii.A., "both in the 1933 anticipation and the 1934
operation, upon the not worth and volume of "business of 229 identical
manufacturers spread throughout the United States, whose 1933 volume
was hereinbefore stated, is indicated in part b? the following group
summary: (**)
1932 1935 1934
Net Worth Total- 314,026,370 $15,089,441 $15,645,815
Average- 61,250 65,893 68,322
$ Increase over
1932 Net Worth - 7.6$ 11.5$
Net Sales Total- $40,992,104 $51,918,217 $62,799,592
Average- 179,005 226,717 ' 274,234
$ Increase over
1932 Sales- - 26.7$ 53.2$
A breakdown of the foregoing summary by large cities appears in
four charts following. (***)
It is noted that the trend was fairly consistent in all areas, ex-
cept Chicago, where net worth declined 10.8$ in 1933, with little change
in 1934. The Chicago tranche of the Industry was under an exceptional
strain during this period when severe losses and readjustments occured
among the 1-rger concerns in the entire Industry whose figures
( *) Analysis of Percentages in ?.obert Morris Associates Statement
Studies, 1933.
(**) A Profit and Loss Survey of Clothing Manufacturers Prepared by the
■ Research, and Statistical Division of Dun and Bradstreet , Inc. ,
and National Credit Off.ice, Inc. Tables XIII, XIV, and XV are
reproduced from this survey.
(***) See Tables XIII and XIV.
9732
-57-
were included in the Cincinnati group shewed the largest two years' per-
centage increase in net worth, with Boston second, and New York third.
In increased percentage of volitne "business, 120 manufacturers in l\ T ew
York had only a .7.j advantage over Cincinnati' s 5, who in turn bettered
Baltimore's 12 manufacturers by .9$,
That the ratio of sa-le^ to not worth varies inversely with the
size of the concern as measured by net worth, .l^ farther illustrated
in a breakdown study cf 243 manufacturers operating in 1923 with an
average net worth cf ;?55,502, raid average volume of ;218,287, sum-
marized as follows: (*)
Net Vorth - Up to )25,000 '50,000 $75,000 Total
$25,000 to to and up
$49,000 $74,000
No. of Cases 62 93 41 42 243
Ave. Sales $70,927 $144,121 15237, 015 $590,592 $213,287
Ave. N.Jorth 15,935 35,510 61,780 154,429 55,502
Turnover
Sales N.Jorth 4vantage of the discount privilege. In
fact, the -oncession made to a manufacturer of the Iiighest financial
standing is an extra. sixty days which is granted by the mills subject
to payment of an interest charge of six percent per annum. Those
happily in funds or with available Ijnes of ban!;: credit are able to
earn si:: percent by anticipating payment within the regular sixty day
terras.
4, Governmental Aid.
During the depression, Governmental agencies were appealed
to in numerous instances, but on the whole the nature of the assets were
such that dependence rested mainly with the existing bank relationship.
RecorO.s of the Reconstruction Finance Corporation (*) indicate- that
from June 19, 1934, to June 30, 1935, loans were authorized to only
(*) See Table XVIII.
9782
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CTv
-66-
seven men's clothing manufacturers. This represented .6^ of the total
number of borrowers from this Federal agency, in an authorized amount
of $473,500, or less than .7 c o of the grand total of all authorized
R. F.C. loans during this period.
5 • S elling T erms
The highly competitive nature of this Industry, and probably in
part due to the four months' terms formerly granted by the fabric mills,
has resulted in the extension of fairly long terms to retailers who
have not been slow to seize their advantage. Usual selling terms to
the average retailer are 2%, 60 days, but not infrequently the retail-
er unfairly takes 30 days extra and still deducts 2^ discount. The
manufacturer, fearing to lose business to competitors, accepts the
added financing burden. Terms to large department stores and big chain
buyers run from 5^ to 7^ discount for end-of-month payment. During the
depression the manufacturer not selling in large volume to department
stores and chains has had to absorb substantial bad debt losses through
the failure of many small retailers.
(a) Seasonal -Activity Changes.
One of the important changes which has taken place in the Men's
Clothing Industry is that of seasonal activity. Formerly the manu-
facturers' producing as well as selling seasons were distinctly two
a year. The factory working periods were of four months' duration
twice a year; that is, the expenditure for materials and labor pro-
duced finished merchandise which was sold and paid for by the retail-
er within a period which enabled the liquidation of indebtedness and
an accounting: of the season's net profit or loss twice each year. This
fostered n generally high state of liquidity in a stable business. The
successful manufacturer was a favored customer of his bank which ex-
tended his credit requirements during the seasonal peaks and twice a
year he was wholly out of debt, except for purchase commitments for
the next season's required materials not as yet taken into his inven-
tory figures.
Today, with less favorable arrangements with the mills, higher
labor costi.., and shorter working weeks, most manufacturers of men's
clothing find themselves producing garments twelve months a year,
largely for stock, with two selling seasons, and no period when the
average plodding manufacturer is able to liquidate a sufficient pro-
portion of his larger inventories to get out of debt to his bank.
(b) Working Capital.
An analysis of end-of-the-season statements submitted by 126
manufacturers for 1931, 167 for 1932, and 238 for 1933, indicated a
three-year average ratio of 56. 64 of the working capital represent-
ed by inventory for the first two years, and 72^ at the end of 1933.*
(*) Behind the Scenes of Business, Roy A. Foulke , Manager, Analytical
Report Department, Dun and Bradstreet, Inc., pp. 144-145.
9782
-67-
Under present conditions it is conservative to say there has
been an increase over former periods of at least one-third of the
average menuf actiirer ' s working capital constantly tied up in in-
ventory, subject to the vagaries of markdowns due to competitive
conditions or declining prices in woolens. In brief, he requires no
less than one-third additional capital today to do the same volume
of business 'as formerly, and operating results during recent years
have not made that needed increase in capital available.
The working capital problem may be epitomized thus: Prior to
1933, at the peak of the two seasons, total indebtedness averaged
two to three times working capital, and dropped in June and December
substantially to an offset of one for one. In the Fall of 1935, lia-
bilities ranged three to six times working capital for the average
clothing manufacturer, with no indication under existing conditions
that these ratios can be reduced.
Frior to 1933, May ended the Spring operating season, which
commenced about January 15. During June and half of July, there
were no manufacturing operations at all. This month and a half re-
presented the period during which liabilities were liquidated by
funds collected from accounts receivable built up during the Spring
operating season. With liabilities at the lowest point, Fall oper-
ations began about June 15, and continued until just prior to Dec-
ember 1st. December and the first half of January represented the
second annual liquidation period.
Today the cutting of Fall merchandise commences the first week
in June and collections from accounts receivable, created by the
Spring business, are used to finance Fall operations for merchandise,
labor, and expenses. The same process occurs with advancing the
Spring cutting to January and for the larger manufacturer, as early
as October. This continuous operating process, with heavier inven-
tories, results in a constant renewal of bank loans. - The larger
manufacturer, using more than one bank, is able to maintain a high-
er credit standing by rotating his bank loans, borrowing from one
bank to pay off another.
E . Labor Costs
Since the practical elimination of the sweat shop, highly skill-
ed garment workers in the concentrated and strongly unionized areas
of New York, and certain other large producing localities, have en-
joyed steady and substantial increased rates of pay. These are nat-
urally reflected in the production costs -of the garment and must be
provided for in the weekly payroll. As increased prime costs-mat-
erial and labor-accentuate the financing requirements of the manu-
facturer, so, too, they increase his burden when buying resistance
develops to his attempt to increase prices. As there remain some
important areas where labor is less highly organized, and rates of
pay are lower, competition from such sources facilitates the sales
resistance to the product of the unionized shop.
It has been pointed out herein that the average gross profits
on sales is around twelve per cent. That means the cost of production
9762
-68-
alone is, on the average, approximately eighty-eight per cent of net
sales. Operating figurers of 243 manufacturers previously referred to
in this chapter* indicated that in 1933 the average cost of direct
labor in relation to sales value of product, amounted to 31.85$, and
ranged according to price -lines and other factors from 30.03 ? -> to 39.12$
in that year. An important effect of the codes was a further increase
in labor costs. Evidence of the trend is found in a comparison of the
"Common Size" Frofit and Loss Statements,** of men's clothing manufact-
urers, computed from a limited number of operating statements sub-
mitted for this purpose. Direct labor, which in 1929 figured 16.57$
of net sales, increased by 1934 to 29.50$, an indicated increase of
nearly 78$ in five years. As a correlary, competitive conditions
have caused many manufacturers to seek means of reducing labor costs.
Attempts at downward reduction of rates or increased production per
man hour for the established rates usually result in disturbances of
production programs and incidental expenses which more than nullify
any apparent success attending the employer ' s effort. His next thought
is migration to a less highly organized area, where cheaper labor may
be had.***
III. RAW AlID SEMI -PROCESSED MATERIALS
The principal materials used in the Men's Clothing Industry are
woolen suitings and pantings, flannel suitings and pantings, top-coat-
ings, overcoatings, worsted staple suitings and pantings, and fancy
suitings and pantings.
A. Cost of Materials .
The value and volume of the total production of the raw materials
named above for the years 1929, 1931, and 1933, is snown in Tables
XX, XXI, r id XXII, It is reasonable to assume that practically all the
fabrics classified in these tables enter into the production of men's
clothing; however, one cannot be certain of the exact amount which is
utilized by that portion , of the Industry under survey.
An analysis of the tables showing the production and distribu-
tion of the fabrics used by the Men's Clothing Industry reveals a
wide fluctuation in both volume and value of these raw materials be-
tween the years 1929, 1931, and 1933. The total value of woolen and
worsted fabrics declined from $321,242,000 in 1929 to pl79,772,000 in
1931 and to $157,602,300 in- 1933: I;j torms'of a'qnaro yards the pro-
duced y»->]"on rnd w.rstcid fribrics totaled 263,070,000 in 1929, but
r'ogi stored^ a. sharp drop !•-. 170,2100,000 in 1951. Th; djclino in a
yard.agc was reversed by 1933 r.s
(*) See Tables XVI, XVII, and XIX.
(**) Statement Studies, the Robert Morris Associates, 1929, 1930, 1932,
1933, 1934.
(***) See Section VIII of this Chapter.
9782
-GO-
TABLE XIX _., -
OESF&TIWG- COS TS IN THE CLOTHING INDUSTBY
BASED ON A STUDY. OF 243 MAMUPACTU3EHS WITH SALES OF $53,043,862
FOE 1933.
COMPARISO N OF FF OFTT^LE AND UNFROFI^ ) LE MANUFACTURING
NET WORTH Less Than 525,000 52 5 ,OP >Q and Up
Losing Profiting Losing Frofiting
No. of Cases 13 49 14 167
Average Sales
$47,904
$77,282
$165,291
$277,445
Turnover
3.58
4.54
3.07
3.94
Sklee/M'
Average Net
$13,385
$16 ,635
$53 , 800
$70,335
Worth
Opera
tin.?; Costs
in Tez'ir.s of Fercent;
irf:e of Sales
Material
47.76
49.39
45.21
52.12
Labor
32.00
33.09
35.16
31.58
Cost of Goods
Sold
79.76
82.48
80.37
83.70
Gross Profit on
Goods Sold 20.24 17.52 19.63 16.30
Expenses and
Salaries 20.99 13.45 17.70 12.12
Bad Debts and
Depreciation
2.13
1.04
Other Income
.09
.10
Other Expense
.20
.22
Net Frofit
2.91
Net Loss
2.99
Percent making
Frofit
79
.03
Percent suffering
Loss
20
.97
2.22
1.44
.33
.24
1.09
.45
2.53
1.05
92.27
7.73
Source: National Credit Office, Inc., New York
9782
-TO-
TABLE XX
MEN'S CLOTHING INDUSTRY
Production of Principal Materials Used, by Kind and State, 1929
1
iq2q
Kind and State
Pounds
Sauare
Tai-ds
Value
Per Cent
Per Cent
Thousands
Per Cent
Thousands
of Total
Thousands
of Total
of Dollars
of Total
Men's fear Fabrics
Woolen, total
81,630
100.0
105,752
100.0
121,568
100.0
Suitings and pantlngs (except
flannels), total
34,802
42. b
51.49b
48.7
52.750
43.4
Connecticut
3,423
4.2
4.b83
4.4
5.31b
4.4
Maine
6.939
8.5
10,960
10.4
9.249
7.6
Massachusetts
8.067
9.9
10,504
9.9
12.435
10.2
Michigan
193
.2
237
.2
304
.3
New Hampshire
3.09b
3.8
4.765
"♦.5
3.984
3.3
New Tork
2.155
2.6
2,b44
2.5
4.30b
3.5
Pennsylvania
1.4R0
1.8
2,243
2.1
1.773
1.5
Vermont
543
. .7
730
• 7
793
.b
Other States
8.93b
10.9
14.730
14.0
14,590
12.0
Flannel suitings and pantlngs.
total
2.099
2.b
3.929
3.7
4,204
3.5
Maine
292
.4
521
.5
b67
.6
Massachusetts
589
• 7
1.091
1.0
l.ObB
•9
Other States
1.218
1.5
2.317
2.2
2.469
2.0
Topcoatings, total
5.332
6.5
7.0b8
6.7
10,315
8.5
Connecticut
1,1*
1.4
1.^37
1.3
2.251
1.9
Maine
330
.4
382
.4
668
.5
Massachusetts
909
1.1
1.2f0
1.2
1.590
1.3
Other States
2.909
3-b
3.979
3.8
5.812
4.8
Overcoatings, total
21.0&H
2b. b
18,b2b
17.b
25,019
20. b
Connecticut
2,054
2-5
2.171
2.1
3,5b9
2.9
Maine
1,420
1.7
1.103
1.1
2,885
2.4
Massachusetts
11. A8
14.4
9.453
8.9
11,482
9.5
Oregon
1.932
2.4
1,5/5
1.5
1.351
1.1
Rhode Island
882
1.1
1,318
1.2
868
-.7
Vermont
985
1.2
827
.8
907
.8
Wisconsin
080
.8
540
• 5
632
• 5
Other States
2.013
2.5
i.b39
1.5
3.325
2-7
Uniform cloths, total
2,566
3.1
3. 52*
3.3
6.863
5.6
Massachusetts
75*
• 9
9&5
.9
1,609
1.3
New Hampshire
12
s/
20
A
23
s/
Other States
1.800
2.2
2.539
5.231
4.3
Other
15.147
18.b
21,109
20.0
22,417
18.4
Worsted, total
72.607
100.0
130. 318
100.0
199,674
100.0
Staple, suitings and pantlngs.
total
35,ioo
48.3
60,316
4b. 3
89.095
44.6
Massachusetts
12,344
17.0
25.134
19.3
33.0bl
16.5
Pennsylvania
3.502
4.8
6./S2
5.2
10,767
5.4
Rhode Island
13.390
18.4
16.471
12.6
31,785
15.9
Other States
5.8b4
8.1
11.929
9.2
13,482
6.8
Fancy suitings and pantlngs,
total
33.756
4b.5
b2,495
48.0
99.895
50.0
Connecticut
2.275
3.1
4.033
3.1
7.121
3.6
Massachusetts
ll,b04
lb.O
22,207
17.0
34.375
17.2
New Jersey
2,010
2.8
3.978
3.1
6.398
3.2
New York
2,bl4
3.6
5.326
4.1
7.496
3.8
Pennsylvania
2,480
3.4
3.369
2.b
7.237
3.b
Rhode IiLul
8.495
11.7
15.474
11.9
25.440
12.7
Other State .
4.278
5.9
8,108
b.2
11.828
5.9
Uniform Cloths
1,418
1.9
2.525
1.9
4,232
2.1
Topcoatings
54
.1
9b
.1
153
.1
Overcoatings
485
.7
b4 5
.5
1.095
.b
Other
1. /94
2.5
4,241
3.2
5.204
2.b
SOuRUE:
9782
Census of Manufactures, 1^29, Vol. II, pp. 415, 4lb. Data are for CensuB classification
■Woolen Goods and Worsted Goods.' They do not Include establishments with annual prod-
uction valuel at less than $5,0J0.
a/ Less than .1 per cent.
Prepared by
Industry Statistics Unit
Statistics Section
Division of Review, NRl
-71-
iriBT.it xxi
IflEH'S CLOTHING INDUSTRY
JToductlon of Principal Materials Used, by Kind and State, 1931
i<m
KIND AND STATI
Poundj
Square Yards
yalue
Per Cent
Per Cent
Thousands
Per Cent
thousands
of Total
Thousands
of Total
of Dollars
of Total
lien's fear Fabrics
Woolen, total
Ul, 814
100.0
58.723
100.0
55,080
100.0
Suitings, and pantlngs (except
flannels), total
i7.y*7
•1.5
29,401*
50.1
23,128
42.0
Connecticut
l,2b(
3-0
2.333
4.0
2,040
3-7
Maine
2.153
5-1
3.S91*
b.b
2,415
4.4
Massachusetts
4,298
10.3
7.01b
12.0
5.858
lO.b
Pennsylvania
(3b
1.8
1.005
1.7
1,178
2.1
Veraont
gjl*
2.0
1,08b
1.8
524
1.0
Other States
8.059
19.3
14,070
24.0
11.113
20.2
flannel suitings and pantlngs,
total
2,331
0.8
4,699
8.0
4,260
7.7
Massachusetts
922
2.2
1,164
2.0
1.299
2.3
Other States
1.909
l*.b
3.535
b.O
2.9bl
5- 1 *
Topcoat logs, total
3.862
9.2
5.027
8.6
5.267
9.6
Connecticut
826
2.0
1.136
1.9
1.405
2.6
Massachusetts
660
1.6
818
1.4
80b
1.5
Other States
2.3r6
5-6
3.073
5-3
3.056
5.5
Overcoatings, total
9.879
2 d
8.213
14.0
10,666
19.4
Connecticut
1,7>*1
1,465
2.5
2.217
4.0
Maine
705
1.7
633
1.1
1,218
2.2
Massachusetts
4,479
10.7
3,578
6.1
3,949
7.2
Bhode Island
3b8
.9
238
.4
306
.8
Other States
2.586
b.l
2.299
3.9
2.976
5.>*
Uniforsi cloths, total
1,900
l*.b
2,421
4.1
3.353
6.1
Massachusetts
357
.9
435
.7
620
1.1
Other States
1.5*3
3.7
1.98b
3.4
2, 733
5.0
Other
5.995
1"*.3
8,959
15.2
8,406
15.2
Worsted, total
61. 131
100.0
112.1 (7
100.0
124, b92
100.0
Staple, suitings
and pantlngs.
total
29,08b
47.6
53. (96
48.0
55,856
44.8
Massachusetts
12.5(8
20.6
23,t>2(
21.1
24,093
19.3
Bhode Island
8.746
14.3
15.052
I 1 *. 517
14.0
17,1(0
13.8
Other States
7.762
12.7
12.9
14.593
11.7
Taney suitings and pantlngs.
total
28,282
46.3
52,000
4b.3
62,049
49.8
Connecticut
1.439
2.4
2,442
2.2
3.253
2.b
Massachusetts
8.846
14.5
17.035
15.2
21.5^8
17.3
Sew Jersey
629
1.0
1.133
1.0
1,461
1.2
Hew York
1,486
2.4
2,890
2.b
2,981
2.3
Pennsylvania
3,241
5.3
5.(58
5.1
7.579
b.l
Bhode Island
8,t>37
14.1
15.031
13- 1 *
18,788
15.1
Other States
4,004
6.6
7.711
6.8
6,1*09
5.2
Uniform cloths
1.738
2.8
2,452
2.2
3.213
2.b
Topcoatlngs
l.bl9a/
2.b
3.127a/
2.8
2. (91«/
2.2
Other
40b
.7
802
.7
783
.b
SOuRuE: Census of
Manufactures.
1931. P- 3b?.
Data are
for Census
classification
"Woolen Goods
and Worsted Goods.* They do not Include establishments with annual production valued at
less than $5,000.
a/ Topcoatlngs, overcoatings, other worsted men's wear fabrics, and auto cloths.
Prepared by
Industry Statistics Unit
Statistics Section
Division of Review, RBI
9782
-72-
TJLBLE XXII
MEN'S CLOTHING INDUSTRY
Production of Principal Materials Used, by Kind, 1933
1933
Pounds
Kinds
Per
Cent
of
Thousands Total
_S < mare Yards
Per
Cent
Thou- of
sands Total
Value
Thousands
of Dollars
Per Cent
of Total
Men's Wear Fabrics
Woolen, total
Suitings and
pantings (except
flannels) ,
total
58,433 100.0 77,397 100.0 55,813
20,526
35.1 33,569 43.4 19,076
100.0
34.2
Flannel suitings
and pantings,
total
5,1.31
8.8
9,806
12.7
7,415
13.3
Topcoat ings,
total
7,184
12.3
9,350
12.1
8,387
15.0
Overcoatings,
total
20 , 233
34.6
15,415
21.2
14,084
25.2
Uniform cloths
total
Other
1,634
3,725
2.8
6.4
2,662
5,595
3.4
7.2
3,211
3,640
5.8
6.5
Worsted, total
58,157
100.0
105,331
100.0
101,789
100.0
Staple suitings
and pantings,
total
Pancy suitings
and pantings,
total
Uniform cloths
Topcoat ings
Overcoatings
Other
29,080
27,613
543
133
166 a/
622 "
50.0 53,425 50.7 48,119
.5
49,227 46.7
51,074
.9
750 .7
889
.2
136 .2
214
278 a/ .3
287 a/
.1
1,465 1.4
1,206
47.3
50.2
.9
.2
.3
1.1
Source: Census of Manufactures. 1953 . "Woolen and Worsted Goods," td.4
Data are for Census classification "Woolen Goods and Worsted Goods."
They do not include establishments with annual production valued at
less than $5,000.
a/ Other worsted, including overcoating.
Prepared by
Industry Statistics Unit
Statistics Section
Division of Review, NRA
9782
shown by a total production of 182,728,000 square yards.
B . Source of Materia ls
A distribution by States of the fabrics used by the Men's
Clothing Industry is shown for the years 1929 and 1931 in Tables
XX and XXI, respective .y. It is readily observed that tne bulk of
these materials is produced in the States of Massachusetts, Rhode
Island, Connecticut, and Maine.
C . Ratio of Materials' Cost to Value of Froducts .
The percentage which the cost of materials is of the value of
products is shown for the years 1929, 1931, and 1933 in Table XXIII.
Attention is directed to the fact that "materials" in this table in-
cludes fuel and purchased electric energy, as well as the fabrics
discussed above. Further,' all figures in this table for the years
1929, 1931, and 1933 relate to all types of men's clothing except
work clothing, and hence do not conform to the Men's Clothing In-
dustry codal classifications. An examination of the figures show-
ing materials' cost in relation to the total value of product in-
dicates little change in the ratios for the years 1929, 1931, and
1933, which are 48. 9 per cent, 47.8 per cent, and 48.2 per cent, res-
pectively.
IV. EMPLOYMENT
In Chapter III, "Fre-Code Problems of the Industry and Writing
of the Code," there will be found a review and conclusions respect-
ing employment, wages, and hours in the Men's Clothing Industry prior
to the formation of the Code. Chapter V, "Labor Under the Code,"
contains a summary of changes in labor conditions brought about dur-
ing the Code period. It is the purpose here to present statistical
data showing somewhat in detail,, at least for recent years, the vary-
ing conditions of employment in this Industry.
Table XXIV, parts A, B, and C shows indexes of factory employ-
ment and an estimated number employed for the years 1926-1935, in-
clusive.* Using 1929 as the base year, it is seen that for the
(*) "The Bureau of Labor Statistics indexes of employment and pay-
rolls have not been adjusted to the 1933 Census. The Census
classifications were revised in 1933 to include many operations
which are not covered by the 3.L.S. sample. Current labor data
from the B.L.S. are based upon a sample covering, for employment,
payrolls, and average weekly wages, approximately 50 per cent, and
for man hours, average hours and average hourly wages, approximat-
ely 40 per cent of the wage earners reported under the Census class-
ifications 'Clothing (except Work Clothing), Men' s, Youths' , and Boys J
Not Elsewhere Classified' and 'Clothing, Work, Men's.' Approximate
ely 65 per cent of the value of products under these Census Class-
ifications were covered by the Men's Clothing Industry Code; the
remaining products were covered for the most part by the Cotton
(Foot-note continued on the following page)
9782
-74-
TABLE XXIII
RATIO OF LABOR COST, AND 0? MATERIALS' COST TO
TOTAL VALUE OF PRODUCT
Total Value Labor Cost a/ Materia l s' Cost b /
Year of Product Amount Per Cent Amount Fer Cent
(000' s) (000' s) of Total (OPO's) of Total
$179,769 19.9 $440,505 48.9 c/
115,041 20.9 , 263,675 47.8 c/
92,265 20.7 214,639 48.2 c/
450,000 e/ 115,530 f/25.7 f/
Source: Census of Manufac turers, "Men's Clothing"; 1934 figures
from Code Authority for Men's Clothing Industry.
a/ Consists only of wages paid to wage, earners.
b/ Cost of materials, fuel, and purchased electric energy.
c/ These figures cover all men's clothing (except work) as
classified by the Census of Manufacturers.
d/ Because of changes in Census classifications, 1933 fig-
ures are not comparable with those for previous years.
e/ Code Authority estimate.
f_/ Estimated on basis of Code Authority figure for value of
products .
1929
$901 , 104
1931
551,416
1933 d/
445 , 220
1934
450,000
9782
TABLE
Sit
MEN'S CLOTHING
FACTORY
EMPLOYMENT
A
Index of
Employment (1923-25=100) a/
1926
1927
1928
1929
1930
1931
1932
1933
1934
1935
Jan.
96.7
100.7
104.1
99.4
100.5
80.9
76.0
70.8
76.7
83.9
Feb.
99.7
104.4
106.7
102.8
101.9
86.1
81.8
77.7
85.5
91.8
Mar.
98.9
103.3
105.1
104.5
98.6
88.2
81.1
75.9
88.7
94.6
Apr.
93.7
97.8
97.8
99.5
93.0
86.6
74.7
75.2
88.0
94.7
May
92.0
97.1
95.7
98.6
89.4
82.9
68.2
73.7
81.5
87.6
June
97.1
102.2
101.3
105.1
92.8
83.4
63.8
79.6
81.6
86.6
July
95.3
102.9
99.5
105.1
90.6
86.8
64.3
86.9
81.4
88.9
Aug.
99.3
105.9
102.9
107.6
90.6
89.6
71.0
88.6
88.4
93.6
Sep.
99.0
105.5
102.7
107.3
92.4
90.8
77.8
89.8
89.5
95.4
Oct.
99.3
105.3
101.5
105.4
37. 5
87.6
80.8
87.8
86.8
94.8
Nov.
97.1
101.8
98.7
102.1
80.6
79.4
79.5
81.2
80.3
Dec.
101.1
102.5
99.3
100.9
78.3
7*; 2
74.1
76.6
79.1
Average
97.4
102.5
101.3
103.2
91.4
84.9
74.4
80.3
84.0
B
Index
of Employment (1929=100) b/
Jan.
93.7
97.6
100.9
96.3
97.4
78.4
73.6
68.6
74.3
81.3
Feb.
96.6
101.2
103.4
99.6
98.7
83.4
79.3
75.3
82.8
88.9
Mar.
95.8
100.1
101.8
101.3
95.5
85.5
78.6
73.5
85.9
91.7
Apr.
90.8
94.8
94.8
96.4
90.1
83.9
72.4
72.9
85.3
91.8
May-
89.1
94.1
92.7
95.7
86.6
80.3
66.1
71.4
79.0
84.9
June
94.1
99.0
98.2
101.8
89.9
80.8
61.8
77.1
79.1
83.9
July
92.3
99.7
96.4
101.8
87.8
84.1
62.3-
84.2
78.9
86.1
Aug.
96.2
102.6
99.7
104.3
87.8
86.8
68.8
85.8
85.7
90.7
Sep.
95.9
102.2
99.5
104.0
89.5
88.0
75.4
87.0
86.7
92.4
Oct.
96.2
102.0
98.4
102.1
84.8
84.9
78.3
85.1
84.1
91.9
Nov.
94.1
98.6
95.6
98.9
78.1
76.9
77.0
78.7
77.8
Dec.
98.0
99.3
96.2
97.8
75.9
73.8
71.8
74.1
76*6
Average
94.4
99.3
98.1
100.0
88.5
82.2
72.1
77.8
81.4
C
Estimated Number Employed
(Thousands) c/
Jan.
140.4
146.3
151.2
144.3
146.0
117.5
110.3
102.8
111.4
121.8
Feb.
144.8
151.7
155.0
149.3
147.9
125.0
118.8
112.9
124.1
133.2
Mar.
143.6
150.0
152.6
151.8
143.1
128.1
117.8
110.2
128.7
137.4
Apr.
136.1
142.1
142.1
144.5
135.0
125.7
108.5
109.3
127.8
137.6
May
133.5
141.0
138.9
143.4
129.8
120.3
99.1
107.0
118.4
127.2
June
141.0
148.4
147.2
152.6
134.7
121.1
92.6
115.5
118.5
125.7
July
138.3
149.4
144.5
152.6
131.6
126.0
93.4
126.2
118.2
129.0
Aug.
144.2
153.8
149.4
156.3
131.6
130.1
103.1
128.6
128.4
135.9
Sep.
143.7
153.2
149.1
155.9
134.1
131.9
113.0
130.4
129.9
138.5
Oct.
144.2
152.9
147.5
153.0
127.1
127.2
117.3
127.5
126.0
137.7
Nov.
141.0
147.8
143.3
148.2
117.0
115.2
115.4
117.9
116.6
Dec.
146.9
148.8
144.2
146.6
113.7
110.6
107.6
111.1
114.8
Average
141.5
148.8
147.0
149.9
132.6
123.2
108.1
116.6
121.9
a/ Bureau of Labor Statistics index for Clothing, Men's.
b/ Index of Employment (A) shifted to 1929 base.
o/ Index of Employment (B) times 1929 Census figure 149,868.
Division of Review NRA
Industry Statistics Unit, -BJ R g /ll/55 R ev is e d E LG ll/ 3 0/ 36
9782
-76-
period 1926-1935, the high point of employment came in August, 1929,
as evidenced by the index 104.3. The low roint of employment for
this period is reflected in the index 5] ", re ;• ■.-.■ i .ti a i -1"
of over 40 per cent, and is found in the month of June, 1932. For
recent years, it is notable that the average index of employment of
77.8 for 1933 climbed to an average of 81,4 for 1934 and continued
this gain to an average of 8S.4 for the first ten months of 1935.
In terms of estimated employment the range for the period 1925-1935
is from a high of approximately 156,300 in August, 1929, to a low
of approximately 107,000 in May, 1933. The gain following the im-
provement in employment in 1933 is shown by an average employment
for 1933 of 116,600; for 1934, an average of 121,900; and for the
first ten months of 1935, an average of 132,400.
(Foot-note Cont'd)
Garment Code. In December 1934, about 80 per cent of the employees
included in the sample were covered by the Men's Clothing Code,' the
greater portion of the remainder being covered by tne Cotton Gs^rw-aut
Code." (Industry Statistics Unit, Division of Peview.)
9782
-77-
A. Stability of Employment.
The Men's Clothing Industry has two. distinct seasons, the summer
and the winter. In the winter, clothing is produced for summer wear,
and in the summer, for winter wear. (*) The following table shows the
seasonality of employment within the years 1935 and 1934 and shows the
1934 gain in employment over 1933.
TABLE XXV..
IITDEX OE E EPLOYMENI a/
. (1933 = 100) i
Month
In.de:: of Employment
1935
1934
January
February
March
April
May
June
July
August
September
October
November
December
90.9
101.7
103.2
112.3
101.6
112.8
94.8
107.8
87.8
94.6
93.7
97.3
104.9
104.6
108.0
114.5
110.4
115.4
108.2
111.7
99.9
102.1
96.4
102.5
Average
100.0
106.5
Source: Unpublished data secured by the Bureau of Labor Statistics
in cooperation with the Division of Research and Planning, BBA.
a/ Reporting establishments almost completely identical with the
Code definition of the Hen's Clothing Industry. 1934 data
came from a much larger -proportion of the Industry than the
1933 data.
Attention is drawn to the fact, as shown by Table XXV that the
high and low months of employment for 1933 and 1954 fell in the same
respective months; namely, September and May. The range for 1933 was
from 87.8 in May to 110.4 in September. For 1934, the range was from
94.6 in May to 115.4 in September. It is, of course, significant to
note that employment for 2934 averaged 6.5 points ahead of 1933.
As further evidence of wide fluctuation in employment in this
Industry, attention is directed to Table XXVI. It is seen that the
range of employment between the high and low months of a year may
fluctuate oy 10 to 20 thousand employees. This table likewise pic-
tures the sharp decline from the average employment of 158,173 during
(*) ' Evidence of the smoothing out of the extremes in production peaks
in the industry was
pages
:ou:
)
nd by Mr. A.A. Eisner (sec this Chapter -
9732
-78-
the year 1923 to 119,253 in 1933 and the subsequent increase in em-
ployment to an average of 132,100 for eleven months of 1935.
The Monthly Labor Review of January, 1929, published by the
U. S. Department of Labor, presented the results of a study of Sta-
bility of Employment in the Men's Clothing Industry. This Study
covered for the years 1923 to October, 1928, sixty-four men's clothing
establishments in various lines of the Industry, disregarding occu-
pational differences and leaving out special products such as caps and
overalls. The standard of measure of stability used was that "If a
particular shop had a monthly average of 90 employees and a maximum
number in any one month of 100, then the stability of employment may be
fairly said to bo 90 per cent."
TABLE XXVI
MELT'S CLOTHING INDUSTRY
Ilumber of Wage Earners, High and Low Months and Yearly Average, 1923-35
Year
High
Low
Average
Month
lumber
Month
ITumber
ITumb er
1923
March
168,771
November
149,259
158,173
1925
February
147,596
May
131,181
141,511
1927
February
153,550
May
139,086
146,099
1929
S eat cmb er
155,845
December
144,496
149,868
1931
Seat ember
130,883
December
110,235
121,964
1933
a/
September
131, 648 &/
December
112,345b/
119,253
1934
si
September
129,900
January
111,400
121,900
1935
c/
September
138,500
January
121,800
133,1001/
Source: Census of Manufactures, 1929, Vol. II, p. 356; 1931, p. 312;
1933, Wearing Apparel, pp. 5 and 8, and unpublished Census
data. .Figures are for Census classification "Clothing (Ex-
cept Worl; Clothing), Men's, Youths', and Boys', Not Elsewhere
Classified." Data are for regular factories and contract
shops. They do not include establishments with annual pro-
duction valued at less than $5,000.
a/ Figures for 1933 are not strictly comparable with those for
previous years because of changes in Census classifications.
b_/ Quarterly figures arc used, since monthly digures are not
available.
cj Estimates computed by multiplying Bureau of Labor Statistics
Index of Employment shifted to 1929 base by 1929 Census
figure (149,868).
d/ 11-months' Average. Figures for December, 1935, are not yet
available.
Prepared by
Industry Statistics Unit
Statistics Section
Division of Review, LIRA.
-79-
The results of the Department of Labor Study arc summarized as
follows:
"1. Judging ~oy the averages, stability of employment in the
lien's Clothing Industry is bad and conditions have shown no improve-
ment in the sic years covered by the Study. Thus, the average sta-?
bility for the plants reporting was only 37.9 per cent in 1923 and in
no subsequent year was the percentage over that high. Also,***this
continuous low average over the six-year period was the resultant
of an increasing number of plants with improving records and a cor-
responding increase in the number of plants with records which were
growing worse. Thus, in 1923, the per cent of plants with employment
stability rates of 95 per cent or over, was only 10.9 per cent, as
against 28.1 and 15.6 per cent in 1927 and 1928, respectively. On
the other hand, the number of plants with stability rates of less than
80 per cent also increased from 15.6 per cent in 1923 to 21.9 in 1927
and 23.4 in 1928.
"2. While the general conditions of employment stability in
the Industry were bad and did not improve over the six-year period, a
number of establishments nevertheless had excellent records. Thus,,
establishments 4 and 6 (Table attached to report) had an average of
more than 96 per cent of full time employment for each of the six
years, and several establishments show averages of more than 98 per
cent in individual years." Hote ; Plants 4 and 6 above referred to
were in New York and Boston, respectively.
V. WAC-BS AID HOURS
A. Average Wages ~oer Hour .
Wages in the Lien's Clothing Industry averaged 75.0 cents an hour
during the year 1926, according to the Bureau of Labor Statistics
index (see Table XXYII-A). This average declined precipitately to a
low point of 50.6 cents an hour for 1932, but rallied considerably
during the Code- oeriod to show an average of 57.7 cents for the year
1934. This improvement continued through the first ten months of 1935,
as indicated by an average of 59.5 cents.
3. Average Weekly Wag es.
Average weekly wages for the period 1926-1935 (see Table XXVII-B)
followed a course comparable to that for average hourly wages. The
reltively high average of $24,15 per week in 1927 declined steadily and
sharply to ■ L r weekly average of $13.70 for the year 1932. The 1932
average weekly wage was improved upon somewhat in 1933, as shown by the
average of $14.14. The sharpest advance took place during the beginning
of the Code period in the last quarter of 1933. The year 1934 dis-
played a still further average improvement to $16.26 per week and was
bettered by an average weekly wage of $18.32 for the first ten months
of 1935.
C. Payrolls .
Payrolls in the hen's Clothing Industry according to the Bureau
9782
-30-
of Labor Statistics index (1929 base) declined in every year from 1929
until a low of 44.1 was reached in 1932. » Subsequent to 1932, ;the
improvement was substantial and consistent, as evidenced by the index
49.3 and 60.4 for 1933 and 1934 respectively, and the average index
of 74.8 for the first ten months of 1935. This represented an average
monthly payroll of $3,457,000 for 1929, which declined to a monthly
average of $1,525,000 in 1932 but subsequently improved to monthly
averages of $1,705,000 and $2,087,000 respectively for 1933 and 1934
and a monthly average of $2,585,000 for the first ten months of 1935.
D • Dist ribution of Payrolls by States .
The distribution of payrolls and wage earners in the Hen's
Clothing Industry by principal States is shown in Table XXIX. It is
readily seen that seven States account for practically the entire em-
ployment and payrolls in the Industry, Hew York State leads by
accounting for around 30 per cent of total employees (and a slightly
higher percentage of total payrolls), and is followed in order by
Pennsylvania, Illinois, Ohio, Maryland, New Jersey and Massachusetts.
E. Distribution of Employment, I.Ian Hours, and
Earnings, by Market Areag c
A distribution of employment, man hours, and earnings is shown
by market areas for the last six months of 1934 in Tabic XXX. The
figures in this Table were obtained from the records of the Men's
Clothing Code Authority in cooperation with the U. S. Bureau of Labor
Statistics and doubtless are the most complete available for any full
season of the Industry. This Table shows a concentration of 69 per
cent of the Industry's employees in the. ten important market areas.
Of the ten most important market areas, Hew York leads with 22.4 per
cent of the total .of the Industry's employees. The remaining nine
areas in order of number of employees are Chicago, Philadelphia,
Rochester, Baltimore, Cincinnati, Cleveland, .Boston, St. Louis, and
Buffalo. Of the 31 per cent of the employees not found in the ten
large market areas, it is interesting to note that around 18 Per cent
are found in cities below 50,000 in population.
Column three of Table XXX shows average hourly earnings by market
areas. The Industry's average is 66.2 cents per hour. Of the large
areas, Chicago leads with an average of 78 cents per hour, and the
range downward is to 56.2 cents paid in Baltimore. The average for the
ten large areas is 71.2 cents. The lowest average hourly earnings rate
in the Industry, of 52.7 cents per hour, is found in the cities under
50,000 in population.
The market area of Cleveland leads the ten large areas in average
weekly man hours for the last half of 1934, with an average of 30.
This was approximately 5 hours better than the average for the ten
large areas, which was 25.7. Rochester, with 22.3 hours, is lowest
of the large areas. Cleveland, leading in weekly man hours, also leads
(*) See Table XXVI I I-B
9782
-si-
table ssyii
UEIT'.S CL02HIHG INDUSTRY
FACTORY WAGES
A
1926. 1927
Average Hourly TTagcs (Cents) a/
1928 1929 1950 1931 1932 ~ 1933
Jan.
Feb.
Mar.
Apr.
May
June
July
Aug.
Sep.
Oct.
i T OV.
Dec.
Average
(75.0
(73.1
(70.1
(50.6
1934
1'935
60.1
54.3
61.4
52.7
62.1
52.3
62.9
53,0
58.3
53. 5
59.0
56.2
57.8
68.6
58.1
61.7
58.1
60-. 7
57.4
60.8
61.7
57.7*
Average Weekly Wages (Dollars) b/
Jan.
24.54
24.33
24.35
23.16
22.24
18.06
1^» 7o
12.58
15.50
16.04
Feb.
24.94
24.97
24.5?
24.38
22.31
20.05
16.32
13.96
17.01
18.53
Liar.
24.69
24-90
iz,*D » y &
24.86
21.70
20.54
16.14
12.69
17. 61
20.39
Aor .
22.73
22. 38
21.13
21.42
19.19
18.50
13.23
11.71
16. 38
20.45
May
22.19
22.66
21.89
22.41
13.45
16.69
12.16
11.65
15.51
16.83
June
24.05
24.82
23.36
23.57
20.39
18.34
11.42
12.72
15.73
17.06
July
24.12
25. 4C
23.97
23.12
21.02
19.55
11.27
14.57
15.76
17.00
Aug.
24.94
25.30
23.89
23.72
21.28
20.16
13.71
16.10
17.51
18.61
Sep.
23.66
25.01
23.50
22.84
20.36
17.39
15.07
17.11
16.51
19.71
Oct.
23.46
24.08
22.87
21.98
13.59
17.28
14.87
17.21
16.90
18.56
Nov.
22.41
22.14
21.78
20.73
16.97
14.98
13.04
15.39
15.19
Dec.
23.93
23.73
23.61
21.83
17.49
15.. 53
11.41
13.96
15.46
Average
23.81
24.15
23.27
22.84
20.00
18.13
15.70
14.14
16.26
a/ Bureau of Labor Statistics scries for "Clothing, Men's." Prior to 1934,
. ■ :au of Labor Stations Bulletins 435, 503- 557 and 594.
b/ Bureau of Labor Statistics scries for "Clothing, Men's."
(*) 11-month average.
Division of Review 1IRA
Industry Statistics Unit
9782
-82-
TABLE XXVIII
MEET'S CLOTEIFG INDUSTRY
FACTORY PAYROLLS
A
Index c
if Payrolls (19;
23-25=100) a/
1926
96.8
1927
99.9
1928
101.7
1929
1930
1931
1932
1933
1934
1935
Jan.
94.0
90.4
59.9
49.1
35.4
43.8
57.0
Feb.
101.2
106.6
105.7
102.5
91.3
69.7
54.1
44,3
60.6
71.8
Mar.
99.6
103.9
101.2
105.8
86.6
73.5
53.6
40.4
65.9
82.0
Apr.
87.0
88.2
83.2
87.1
73.8
64.8
40.9
36.8
61.4
32.5
May-
83.6
88.8
84.5
89.8
67.5
56.6
54.2
35.2
53.3
64.4
June
94.3
101.0
96.9
100.8
76.1
62.1
29.3
41.8
54.6
63.7
July
94.1
104.0
95.8
98.2
77.3
69.2
29.4
51.3
54.5
65.6
Aug.
101.1
106.6
99.5
103.4
79.2
72.4
40.4
58.7
65.5
74.3
S ep,
96.0
104.4
97.7
100.2
76.2
6G.3
48.6
63.9
62.2
80.4
Oct.
95.8
101.2
95.5
93.0
6 ; 3. 3
61.4
49.6
62.6
62.6
74.8
y.ov.
89.3
92.0
87.7
85.7
55.2
48.6
43.0
52.4
52.1
Dec.
99.2
97.9
96.2
89.4
55.4
48.5
34.8
44.4
52.6
Average
94.8
99.5
95.5-
95.8
74.7
62.8
42.3
47.3
57.8
B
Index
of Payrolls (1929=100")
V
Jan.
101.0
104.3
106.2
93.1
94.4
62.5
51.2
36.9
50.9
59.5
Feb.
105.6
111.3
110.3
107.0
95.3
72.7
56.5
46.2
63.2
74.9
Mar .
104.0
108.5
105.6
110.4
90.4
76.7
55.9
42.2
68.8
35.6
Apr.
90.8
92.1
86.8
90.9
77.0
67.6
42.7
38.4
64.1
86.1
May
87.3
92.7
88.2
93.7
70.5
59.1
35.7
36.7
55.6
67.2
June
98.4
105.4
101.1
105.2
79.4
64.8
30.6
43.6
57.0
66.5
July
98.2
108.6
100.0
102. £
80.7
72.2
30.7
53.5
56.9
68.5
Aug.
105.5
111.3
103.9
107.9
32.7
75.6
42.2
61.3
68.5
77.5
Sep.
100.2
109.0
102.0
104.6
79.5
69.2
50.7
66. '7
64.9
83.9
Oct.
100.
105.6
99.7
97.1
69.2
64.1
51. '8
65.3
65.3
78.1
JMOV.
93.2
96.0
91.5
89.5
58.7
50.7
44.9
54.7
54.4
Dec.
103.5
102.2
100.4
93.3
57.8
50.6
36.3
46.3
54.9
Average
99.0
103.9
99.6
100.0
78.0
65.5
44.1
49.3
60.4
C
Estimated To
tal Payroll (Thousands
of Do]
.lars')
1276
5/_
1760
2057
Jan.
3492
3606
3671
3391
3262
2161
1770
Feb.
3651
3848
3813
3699
3295
2513
1953
159V
2185
2589
Mar".
3595
3751
3651
3817
3125
2652
1933
1459
2378
2959
Apr.
3139
3184
3001
3142
2662
2337
1476
1328
2216
2977
May
3018
3205
3049
3239
2437
2043
1234
1269
1922
2323
June
3402
3644
3495
3637
2745
2240
1058
1507
1971
2299
- July
3395
3754
3457
3544
2790" '
249 £
1061
1850
1967
2568
Aug.
3647
3848
3592
3730
2359
2514
1459
2119
2368
2679
Sep.
3464
3768
3526
3616
2748
2392
1753
2306
2244
2901
Oct.
3457
3651
3447
3357
2392
2216
1791
2257
2257
2700
Nov.
3222
3319
3163
3,094
2029
1753
1552
1891
18S1
Dec.
3578
3533
3471
3225
1998
1749
1255
1601
1898
Average
3423
3592
3443
3457
2697
2264
1525
1705
2087
a/ Bureau of Labor Statistics Index for "Clothing, Men's".
b/ Index of Payrolls (a) shifted to 1929 base.
c/ Index of Payrolls (B) times 1929 Census figure $3,457,092.
Division of Review I~RA
Industry Statistics Unit
9782
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with the highest average weekly earnings, which were $-21.15. The lor in
average weekly earnings was shorn by Baltimore, with $14.72, against
and Industry average of $17.01 and en average for the large market areas
of $18.30.
Table XXXI, "based on Bureau of Labor Statistics data, summarizes
for the entire Inc I ustr; r for the -'leriod 1C26-1935 average hours worked
per reek and estimated total man hours per neek. Average h-urs worked
per week declined steadily from a high of 41.0 in 1926 to a low of
28.2 in 1254.. The average of 30.4 for the first ten months of 1935 •
reflects a ;ain of 2.2 hours tier week over the low noint of 1934. Ero-
cept for an increase in number of man hours worked in 1928 over 1925,
the decline in man hours from l^S to 1934 closely parallels the trend
evidenced by average hours worked ner reek. The very substantial in-
crease to the average of 4,324,000 man hours worked for the first ten-
months of 1935 over the 3,464, 00C man hour average for eleven months
of 1934 is net able.
F . T7age larhers Classified According to Average
Hourly v <8 ^e Pake to Al l Snnloyees in Estab-
lishments, .for the Industry,, ,aq.d .for Market -Areas .
The Men's Clothing Code Authority made a wage analysis of some
1,471 establishments in the Industry, emoloying 99,107 workers. (*)
The establishments included (a) all of the larger units; (b) over 650
smaller manufacturers, ranging from the smallest establishments, em-
ploying some 300 workers, and averaging less th- n 40 workers ner es-
tablishment; (c) over 700 contractors employing about one-third of the
total. This analysis is -presented in Table XXXII, entitled "Frequency
Table Showing Distribution of 1,471 Establishments Classified According
to Average hourly *,7age Paid to All Employees in Establishments."
It was found in this analysis of 1,471 establishments that more
than one-half of the workers " r ere emoloyed in establishments where the
average —age was 65 cents or more ner hour, and over 60 ner cent of the
workers were emoloyed in establishments "here the average "as over 6C
cents per hour. On the other hand, 6.5 ner cent of the workers rere
emoloyed in establishments where the average was between 40 cents and 45
cents per hour; and 7.8 ner cent of the workers were emoloyed in establish-
ments where the average was between 45 cents and 50 cents per hour.
The averages for these establishments included rages naid to cutters,
who had a minimum provided for in the Code of $1.00 ner hour, and wages
naid to off-nresserr, whose ninimum was fixed at 75 cents per hour,
so that it appears the average for other manufacturing emnloyees in the
low-wage establishments was close to the Code minimum of 40 cents ner
hour .
In Table XXXIII, is presented data similar to that in Table XXXII,
classified for the ten orincipal clothing markets. Here again, in
( * ) Statement Submitted in Suroort of the Amendments to the i^en's
Clothing Code Proposed by the ; anager.ent kenbers of the Code Authority .-
(Men's Clothing Code Piles.)
9782
-86-
MEN'S CLOTHING INDUSTRY
FACTORY HOURS
Average Hours Worked Per Week a/
1926 1927 1928 1929 1930 1931 1932 1933 1934 1935
Jan.
Feb.
Mar .
Apr.
May
June
July
Aug.
Seio.
Oct.
Nov.
Dec.
Average
(41.0
(40.6
(37.8
(.37.3
26.5
30.4
30.2
32.2
79 Q
30.5
32.7
29.2
28.3
29.3
28.6
28.3
29.1
25.9
31.5
26.7
33.2
27.4
31.4
24.8
25.1
28.2*
30. 4 :
B
Estimated Total Man Hours Per Week b/
(Thousands)
Jan.
Feb.
Mar .
Apr.
May
June
(
July
(58(
Aug.
(
Sep.
Oct.
Nov.
Dec.
Average
(5968
(5012
(4032
3775
4144
3898 .
3457
3472
3345
3326
3468
3452
2892
2881
3464*
3228
4C23
4520
4500
3600
3595
3754
4281
4598
4324
4042
a/ Bureau of Labor Statistics series for "Clothing, Men's." Prior to
1934, Bureau of Labor Statistics Bulletins 435, 503, 557, and 594.
b/ Estimated Number Employed (Table XXIV - C) times Average Hours Worked
per week, (Table XXXI - A).
* 11-month average.
** 10-month average.
Division of Review NRA
Industry Statistics Unit
9782
-87-
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-90-
greater or lesser degree, the same disparity in wage conditions is shown.
G. Average Annual Wages in Ken 's Clo thi ng Compared
with All Other Manufacturing Industries .
An analysis of Table XXXIV, reveals that the average annual wage
in the Men's Clothing Industry has shown a greater decline since 1923
than has the average annual wage in all other manufacturing industries.
In 1923 the average annual wage of $1,310 in the Men's Clothing Industry
was 4.5 per cent higher than that for all other manufacturing industries;
namely, $1,253. This supremacy was lost by 1925 and by 1933 it is found
that the average annual wage in Men's Clothing was only 88.7 per cent of
that in all other manufacturing Industries.
H. Comparison of Change s in Average -Weekly Wages
and in Cost of Living.
A comparison of changes in average weekly wages in the Men's Cloth-
ing Industry with changes "in the cost of living (see Table XXXV, reveals
that real wages in the Industry suffered materially in the change from
1923 to 1924 and continued to lose ground slowly until a considerable
disparity is witnessed daring the year 1932, when dollar wages declined
from 100 in 1929 to 60 in 1932, while at the same time the cost of living
declined from 100 only to 74.9. The year 1934, however, shows a much im-
proved situation for the Men's Clothing wage earners, as at this time
there existed a difference of only around 6 points between the average
weekly wage index and the index of the cost of living as against a differ-
ence of 14.9 points in 1932.
VI. PRICES: RAW MATERIALS AND FINISHED PRODUCTS
It is not possible,, from records available, to make an accurate
survey of the changes and interrelationships in prices (raw materials and
finished products) at wholesale and retail in the Men's Clothing Industry.
Nevertheless, some realization of the price trends in the Industry dur-
ing recent years may be obtained from a survey of certain Bureau of
Labor Statistics indexes and records of actual -prices.
The movement in the price of raw materials is pictured in Table
XXXVI, using as an index the wholesale price per yard of 16 ounce serge
quoted at a single plant or factory considered by B.L.S. to be represen-
tative of the whole country. It is observed that the price of this 16
ounce serge in the 1926-1935 period declined steadily from the 1926
yearly average of $3.76 per yard to a low average of $2.27 for the year
1932. This represents a fall in price of approximately 40 per cent. The
averages for the years 1933 and 1934 show an improvement over the 1932
low as evidenced by the prices per yard of $2.59 and $2.89, respectively.
The increase from 1932 to 1934 amounted to about 27 per cent. The
first six months of 1935 show an average of $2.72 per yard, which re-
presents a slight decline from the $2.89 average ofL934. The advance in
price from the low point average for 1932 to the T935 six months' average
approximated 20 per cent.
9782
-91-
TABL*; X3CCV
LAST'S CLOTJiIIJG INDUSTRY
Comparison of Changes in Average Weekly Wages in the Men's Clothing
Industry and in tne Cost of Living, 1923-1034
Average
Weekly
Wage s
(Dollars^
Index of
Weekly
Wage s
(1 929 z ion )
Index of
Cost of
Living b/
(19 29 Z. 100)
1923
1924
•1925
1926
1927
1928
1929
1930
1931
1932
1933
1934
24. 97a/
24.15a/
24. 17a/
23,81
24.15
23.' 27
22.84
20.00
18.13
13.70
14.14
16.26
109.3
105.7
105.8
104.2
105.7
101.9
100,0
87.6
79.4
60.0
61.9
71.2
99.4
100.9
103.7
103.9
101.5
100.3
100.0
95.6
84.9
74.9
72.1
77.3
SOURCE: Bureau of Labor Statistics, National Industrial Conference
Board, National Recovery Administration.
a/ Derived from B.L.S. employment and payroll indexes and ad-
justed to B.L.S, current published weekly wages.
b/ National Industrial Conference Board index of cost of liv-
ing as weighted and shifted to a 1929 base by the Division
of Research and Planning, 1T.R.A.
Frepared by
Industry Statistics Unit
Statistics Section
Division of Review, H.R.A.
9782
-92-
TABLE XXXVI
MEN'S CLOTHING INDUSTRY
Wholesale Prices - Raw Materials a/
Serge
, 16 ounce -
Per Yard
, Mill
(Dollars)
1926
1927
1928
1929
1930
1931
1932
1933
1934
193fe
Jan.
4. OS
3.63
3.69
3.61
3.45
2.96
2.66
2.10
3.10
2.67
Feb.
3.87
3.65
3.71
3.61
3.35
2.96
2.66
2.10
3.10
2.67
Mar.
3.87
3.65
3.71
3.61
3.35
2.92
2.66
2.10
3.06
2.71
Apr.
3.87
3.65
3.71
3.61
3.35
2.78
2.33
2.11
2.93
2.72
May
3.87
3.65
3.71
3.61
3.35
2.78
2.33
2.45
2.90
2.74
June
3.87
3.65
3.71
3.61
o» oO
2.78
2.05
2.55
2.90
2.82
July
3.66
3.65
3.67
3.60
3.20
2.78
2.05
2.59
2.90
Aug.
' 3.62
3.65
3.61
3.49
2.96
2.69
2.06
2.86
2.90
Sept,
3.62
3.65
3.61
3.49
2.96
2.66
2.10
2.97
2.90
Oct.
3.62
3.65
3.61
3.49
2.96
2.66
2.10
3.10
2.62
Nov.
3.62
3.65
3.61
3.49
2.96
2.66
2.10
3.10
2.65
Dec.
3.62
3.68
3.61
3.49
2c 'a*6
2.66
2.10
3.10
2.67
Average
3.76
3.65
3. 66
3.56
3.18
2.77
2.27
2.59
2.89
a/ Bureau of Labor Statistics. Series represents prices quoted at a
single factory or plant considered "by B.L.S. to be representative
of the whole country.
Division of Review NRA
Industry Statistics Unit
9781
The fluctuations in the index of composite wholesale prices of fin-
ished goods in the Men's Clothing Industry (see Table XXXVII, follow a
course closely approximating the changes in the wholesale price of raw
material above outlined. The decline i n the wholesale p rice of finished
products from the high point of 1926 to the low point of 1932 approximat-
ed 36 per cent as against the decline in raw materials of about 40 per
cent. The increase in the wholesale price of finished products from 1932
through 1934 (yearly averages) amounted to around 32 per cent as against
the increase in raw materials of arount 27 per cent. The advance in the
wholesale price of finished goods from the low yearly average of 1932 to
the ten months' average for 1935 amounted to 25 per cent as against an
advance in raw' materials for. the same period approximating 20 per cent.
The Fairchild index of retail prices for "lien's Apparel," found '
in Table XXXVIII, is based upon the prices for a great variety of garments,
including hosiery, underwear, shirts, hats, caps, and overalls, and hence
is not. directly comparable with the index of wholesale prices for finished
products in the lien's Clothing Industry above ciscussed. It may.be worth
noting, however, and it is not unexpected; to find as revealed by the'
Fairchild index that- retail prices in nen's clothing are at their low
point in 1933" as against the low point for wholesale prices found in the
preceding year. It is likewise of interest that the fluctuation in re-
tail prices were not as extreme, neither falling nor advancing to the
degree and as rapidly as did wholesale prices of raw materials and finish-
ed products.
VII. EXPORTS A1ID IMPORTS
In terms of Industry totals, the quantity of men's clothing exported
and imported is of little consequence. Table XXXIX, shows that the aver-
age number of men's and boys' overcoats, suits, and pants exported per
year for the years 1926-1930 is 148, 0(T). While direct comparisons are not
possible, this amount would appear to represent from 1 to 2 per cent of
the Industry's total production. During the year 1931, garments in the
amount of 54,000 pieces were exported, representing less than 1 per cent
of the Industry total for that year. No subsequent year through 1934 had
equaled the 1931 year in export volume. The export volume has declined
steadily from 88,000 pieces in 1930, with the exception of 1933, to a
volume of only 18,000 pieces in 1934. Value of exports declined compar-
ably from $440,000 in 1930 to $85,000 in 1934. The 1934 value of exports
represented less than 1 per cent of the total value of the Industry's
products.
Import f ir-mres for men's clothing are available only in combina-
tion with "Clotning and .Articles of Wearing Apparel, of Wool, (Except Wool-
Pelt Hats and Hat Bodies) , Hot Knit or Crocheted," (See Table XL, and
hence are not directly comparable with exports or Industry totals. With
respect to the category above mentioned, for the years 1929 through nine
months of 1935, it is observed that 1929 is the peah year for imports, with
574,948 lbs. and that 1932 shows the lowest importation, with 172,134 lbs.
Imports in pounds increased considerably from the low point of 1932 to a
total of 279,937 lbs. for the first nine months of 1935. The 1929 importa-
tions were valued at $2,548,204 and declined to 3432,883 in 1932, but
increased from this level by approximately ion per cent to imports for the
first nine months of 1935, valued at $875,r71.
9782
-94-
table xr:vn
MEN'S CLOTHING IEDUSTRY
WHOLESALE PRICES
A
Index of C
lomposite
Whole:
sale Pr
ices (1929=100) a/
1926
1927
1928
1929
1930
1931
1932 1933
1934
1935
Jan.
113.7
112.2
108.6
101.9
98.5
87.1
76.3 69.8
104.7
87.6
Feb.
113.7
112.2
108.6
101.9
98.5
87.1
76.1 69.8
104.0
87.8
Mar.
113.7
111.7
104.7
101.9
98.5
86.1
74.2 69.8
104.0
87.8
Apr.'
113.7
111.7
104.7
99„5
97.9
36.1
73,4 71.2
100.9
87.8
May-
113.7
111.7
104.7
. 99.5
97.9
86.1
71.6 72.9
95.3
87.8
June
113.7
111.7
104.7
99.5
97.4
85.3
70.4 75.9
95.2
92.5
July
113.7
111.7
104,7
99.5
97.4
85.3
69.3 78.8
95.8
92.5
Aug.
113.7
111.7
104.7
99,5
97.4
85.3
69.3 84.7
88.4
92.5
Sep.
112.9
111.1
103.4
99.5
94.3
85.3
70.1 93.7
88.4
92.5
Oct.
112.9
109.3
' 102.2
99,2
93.6
82.2
71,0 101.7
87.7
92.8
Nov.
112.9
109.3
102.2
99.2
93.2
31,8
71.0 105.2
86.9
Dec.
112.2
108.6
101.9
98.8
93,2
78.8
70..8 105.2
86.9
Average
113.3
111.1
104.6
100.0
96.5
84.7
72.0 83.2
94.7
B
11
;ems and
. Weight
,s for Index of
Men' s
Clothing Price
s b/
Item
Weight
Overcoats, Mer
l 1 s and Youths'
.09
Suits ,
Boys' ,
4-piece
.05
Suits,
Men' s,
3-piece
.19
Suit s ,
Men' s,
4-piece
.19
-
Suits,
Youths'
, 4-piece
.25
Topcoat
s
.09
Trousers, Boys
>' knee
.04
Trousers, Men'
s dress
.10
1.00
Note: The composite index of wholesale prices was computed by MA from Bu-
reau of Labor Statistics price quotations for eight Men's Clothing
items. In combining these price quotations weights based upon the
quantity produced as shown in the 1931 Census of Manufactures were
used. Quotations on overcoats are factory prices. All other quo-
tations are New York prices except men's three-piece suits and top-
coats which are Chicago prices. The 3.L.S. price series and their
respective weights are shown in Table B.
a/ Composite of eight Bureau of Labor Statistics indexes on 1929 base
weighted as shown in Table B.
b/ Weights are based upon quantities produced as shown in 1931 Census
of Manufactures.
Division of Review NBA
Industry Statistics Unit
9782
Average
-95-
Lffll'S CLOTHIJIG IKS - > SY
&STAIL PPJOES
Index of Retail Prices (Deo. 1930rlOO) a/
1926 1927 1928 1928 1930 1931 1932 1933 1934 1935
Jan.
Feb.
Mar.
Apr.
May
June
July
Aug.
Sep.
Oct.
Nov.
Dec. 100.0
93.4
33.3
72.4
36.5
87.4
97.5
31.7
71.6
88.4
87;4
97.6
80.9
71.2
38.9
87.3
97.0
30 . 2
70. 7
87.9
87.4
3 O* i^'
79.4
71.0
88.1
37.3
94.4
77.2
71.3
37.7
87.2
93.2
75.8
75.1
38.3
87.1
92.0
74.7
80.4
37.7
87.1
90.6
74.6
82.9
37.7
87.2
88.8
74.5
85.6
37.7
87.6
73.9
86.2
37.3
,0 86.1
73.0
86.2
87.4
93.2
77.4
77.1
37.3
a/ Fairchil&'s Index for "lien's Apparel," taken from Survey of Current
Business. Prices are as of the 1st of the following month.
Division of Review SEA
Industry Statistics Unit
9782
-96-
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9782
-97-
Of the countries selling clothing end articles of wearing aoparel
to the United States, the United Kingdom accounts for the greater por-
tion in terras of "both quantity and value, ranging from 63 Der cent to
86 per cent of the total iraoorts.
VIII. MIGRATION IN THE ME' T, S CLOTHING INDUSTRY
0n° of th° most striking phas°s of the economic development of
the Men's Clothirg Industry during the reri^d 1923-1929 was the movement
of the Industry out of the major manufacturing centers, into smaller
cities and country districts. In support of this observation attention
is directed to the following statistics which are "based on United States
Census of Manufactures data. (S*= Tahles XLI, 30,11, SLIII, XLIV, and
3CLV.
: Establishments in the fiv» major manufacturing cities declined
from 3,047 in 1923 to 2,54? in 1929, or ahout 16 tier cent; while the
establishments outside these centers increased "by 100 from 1,560 in
1923, or ahout 6 x>er cent.
The wage earners in the five major manufacturing centers "between
1923 and 1S29 declined from 97,086 to 77,841, or ahout 20 per cent; where-
as the wage earners outside the five manufacturing centers increased from
97,754 to 110,228, or ahout 13 per cent.
Wages uaid in the five major manufacturing centers declined from
$145,356,000 in 1923 to $108,450,000 in 1929, or ahout 25 per cent;
whereas the wages naid in the Ri Qri s outside the five major manufacturing
cities increased from $90,131,000 to 397,956,000, or ahout 9 per cent.
Value of uroduct for the five major manufacturing citi°s declined
from $774,195,000 in 1923 to ->f 03 : 299, 000 in 1920, cr ahout 21 r>er
cent; whereas the value of nroduet of the areas outside the five major
manufacturing cities increased from $4t04, 520,000 to $431,256,000, or
ahout 7 p°r cent.
A similar situation prevailed with resuect to cost of materials.
The five major manufacturing cities declined, in cost of materials from
$345,124,000 in 1925 to 3293,454,000 in 1929 or ahout 15 r)er cent; where-
as the areas outside the five major manufacturing cities advanced from
$212,347,000 in 1925 to $230,695,000 in 1929, or ahout 9 -oer cent.
IX. RATIO OF LABOR COST TO VALUE OF PRODUCT
Tahle XXIII, indicates for the years 1929, 1931, 1933, and 1934,
the ratio of lahor cost to the total value of the Industry's product.
It is ohserved that the ratio of lahor cost to total value of product
increased consistently from 1909 through 1934 and that a sharo increase
is registered "between the years 1933 and 1934. The ratio increased from
19.9 for 1929 to 21.4 for 1933 and Eh^n moved sharply to 25.7 for the
year 1934.
9732
-98-
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9782
-100-
TA3LE XIII
MEN'S CLOTHING- INDUSTRY
Wage Earners for tlie United States, the Vive Major Cities and
Outside the Eive Major Cities, by Census Years 1S23 - 1929
United States ITive Major Cities a/ Out si tie Pive Major Cities
Per Cent of Per Cent of
United States United States
Number Number Total Mur.ber Total
1923
19^,320
97,066
'+9.8
97,754
50.2
1925
17^,332
80,588
46.2
93,7^1
53.8
1927
186,711
82,5^1
44.2
10)1,170
55.8
1929
188,069
77.SU1
4i.4
110,228
58.6
SOURCE:
Census of Manuf
clotures.
1929
, Vol.
II, 'OV» 35S
and
368;
Vol. Ill, pp. 15s, 225, 378, 3S0, 466. Data are a combination
of Census classifications (l) "Clothing (E::cept Uork Clothing),
Men's, Youths' and Boys' Not Elsewhere Classified" and (2)
"Clothing, TJorh (including Sheep-lined and Blanket-lined Work
Coats but Not Including Shirts), Men*s." They do not include
establishments with annual production valued at less than
$5,000.
a/ Data are for establishments located within the city limits
rather than within the respective industrial areas of New York
City, Rochester, Chicago, Baltimore and Philadelphia.
Prepared by
Industry Statistics Unit,
Statistics Section,
Division of Review, NRA
November 13, I935
9782
-101-
TA3LE XLIII
MEN'S CLOTHING INDUSTRY
Wages for the United States, the Five Major Cities, and Outside
the Five Major Cities, by Census Years, 1923 - 1929
United Sta
tes
Five
Ma jar Cities
Per Cent
a/
of
Outside F
ive M
Per
ajor Cities
Cent of
Wages
Wages
United St
ates
Wages
Uni
ted States
($1,000)
($ 1,000)
Total
($1,000)
Total
1923
235,48?
145,356
61.7
90,131
38.3
1925
203,847
117,914
57.8
85 , 933
42.2
1927
214,559
121,982
56.9
92,577
43.1
1929
206,416
108,450
52.5
97,966
47.5
Source:
Census of M
anuf
acturers,
1929, Vol. II
pp.
356 and 368;
Vol.
III, '
pp. 158, 225, 578, 380, 466. Data are a combination of Census
classifications ( l) "Clothing (Except Work Clothing), Men's,
Youths', and Boys', Not Elsewhere Classified" and (2) "Clothing,
Work (Including Sheep-lined and Blanket-lined Work Coats but Not
Including Shirts), Men's." They do not include establishments
with annual production valued at less than $5,000.
a/ Data are for establishments located within the city limits rather
than within the respective industrial areas of New York City,
Rochester, Chicago, Baltimore, and Philadelphia.
Prepared by
Industry Statistics Unit,
Statistics Section,
Division of Review, NRA
November 13, 1935
-102- .
TABLE XLIV ■
MEi:'S CLOTHIHG INDUSTRY
Value: of Products:- for the United States, the Five Major Cities,
and Outside- the Five Major Cities- By Census Years, 1923-1929
Un ited S taves Five Major Pi ti es a / O utside Five Major Cities
Percent of Percent of
Amount . Amount United States Amount United States
($1,000) ($1,000) Total ($1,000) Total
1923 1,178,715 774,195 55.7 404,520 34.3
1925 1,087,238 691,287 63.6 395,951 36.4
1927 1,079,471 670,514 62.1 408,957 37.9
1929 1,039,554 608,298 58.5 431,256 41.5
Source: Census of Manufactures,' 1929, Vol. II, pp. 356 and 368; Vol. Ill,
■pp. 158, 225,. 378, 380, 466, Data are a combination of Census
classifications (l) 'Clothing (Except 'Jo rk Clothing), Men's,
Youths', .and Boys', "Jot elsewhere classified" and (2) "Clothing,
Work (including Sheep-lined and Blanket-lined Uork Coats but
Ivot including Shirts), Men ! s." They do not include establishments
with annual production valued at less than $5,000.
a/ Data are for establishments located within the city limits rather
than within the respective indur trial areas of l>7ew York City,
Rochester, Chicago, Baltimore and Philadelphia.
Prepared by .
Industry Statistics Unit,
Statistics Section,
Division of Review, HRA
Pov ember 13, 1935.
noon
-103-
TABLE XLV
LIEN' S CLOTHING INDUSTRY
Cost of Materials a/ for tie United States, the Pive Major Cities
and Outside the rive Major Cities, by Census Years, 1925-1929.
United State s rive Major Citie s b/ Outside Five Major Ci ties
Percent ©f Percent of
Amount Amount United States Amount United States
( M.QOC) (51.000) Total ('51,000) Total
1925 557,471
1927 53 J, 379
1929 524,057
345 , 1 34
61.9
212,347
33.1
317,162
59.6
215,217
40.4
293,454
56.0
230,603
44.0
Source: Census of Manufactures, 1929 , Vol. II, pp* 356 and 368;
Vol. Ill, pp. 158, 225, 378, 330, 466. Data are a combina-
tion of Census Classifications (l) "Clothing (Except V/ork
Clothing), lien's, Youths' , and Boys' , Not Elsewhere
Classified" and (3) "Clothing, ,7orh, (including Sheep-lined
and Blanket-lined 7/ork Coats but Not Including Shirts),
Men's." They do not include establishments with annual pro-
duction valued at less than ;5,000.
a/ Including containers, fuel and purchased electric energy.
Data are for establishments located within the city limits
rather than v/ithin the respective industrial areas of
New York City, Rochester, Chicago, Baltimore and Philadelphia.
Prepared 'o:j
Industry Statistics Unit,
Statistics Section,
Division of Review, N3A
November 13, 1935.
9732
-104-
X. LABG3 HELAIIGNS
Two labor -unions operate in tie lien 1 s Clothing Industry — the
United Garment Workers of America, and the Amalgamated Clothing
Workers of America. Mr. Sidney "Tillman, president of the last-named
grou , stated at the pre-Code hearing cf July 26, 1933, that tie In-
dustry ?ra.s 80 percent organized. One group cf plants in the Industry,
located principally in the urban "centralized" areas, is almost entire-
ly unionised, having working agreements with the Amalgamated Clothing
"Vorkers. Another group, located mainly in the small cities and country
areas, operates under working agreements with the United Garment
.Vorkers of America.
Until around 1910-1911, the United ferment .Vorkers, affiliated
with the American Federation of Labor, was the only' union in the Indus-
try. Labor, in 1911, struck against both management and labor leader-
ship. The Amalgamated Clothing '.Vorkers 1 Union was founded and has
since become the dominant union of the Industry. The Chicago strike of
1911, headed by the Amalgamated group, led to the recognition of a mere
responsible relationship of manufacturers to employees. The irresponsi-
ble contractor control system in Chicago was eliminated. The aggressive
Amalgamated Union by 1919 had achieved unionization of the entire .- I.-
Chicago market and of other large markets throughout the country. The
important New York market has had agreements with the Amalgamated
since 1914; the last strike -was in 19.-30.
According to Charles E.-Zaretz (*), "It was only with the or-
ganization of the Amalgamated in 1914 that an upward swing in wages
and a downward trend in hours began and continued steadily from 1914
until 1924..." His investigations and analyses of other studies indi-
cated that:
b" ...while in the men's clothing industry the working week
has been reduced 14.6 percent in the 10-year period be-
tween 1314 and 1924, it was reduced only 9.3, percent in
. . .24 manufacturing industries and 3.3 percent in
eight 'union manufacturing industries' during the same
period. A similar comparison in fill time earnings of
the throe groups shows that wb.il e in tie men's clothing
industry the weekly earnings increased 156 percent be-
tween 1914 and 1924, during tie seme period the increase
for eight 'union manufacturing 1 industries was 109
percent and for 24 manufacturing industries only
103 percent. These comparisons indicate that since the
organization of tbe Amalgamated the working hours and
earnings of the clothing workers have improved in a much
greater degree than the working hours and earnings of
the worker in both the unorganized and partly organized
manuf ac taring indus tr i e s . "
(*) "The Amalgamated Clothing Jorkers cf America," (Hew York,
1934) Pages 245-246.
9782
-105-
In considering tlie above improvements in hours and wages in the
lien 1 s Clothing Industry attributed to effort? of the Amalgamated Union,
it must be remeiribered as pointed out by Lir.' Zaretz that in 1914 and
prior thereto the Industry "was notorious for the low wages and long
hours that prevailed in it." In 1914, according to TJ. S. Bureau of
Labor Statistics reports, the average full time hours per week was
51.3 and average full time earnings per week was )13.06.
The Amalgamated 1 s efforts toward stabilizing conditions in the
hen's Clothing Industry can best be presented by a summary of a
harch 1, 1932, article appearing in the Survey, by Sidney 'Tillman,
President, Amalgamated Clothing Workers of America, entitled "Labor
Leads Toward Planning." i.ir. Hillman described the efforts and aims of
the Amalgamated as follows:
The Amalgamated from its inception recognized that
an attack on the hen's Clothing Industry's problems
was a concern of both employers and employees.
"This meant joint employer and employee attach
on the specific problems of stabilizing pro-
duction, reducing costs, eliminating waste, com-
posing difference promptly and peaceably, and
taking advantage of new technical advances in
the industry without impairing the worker's
earnings. "
It is pointed out that the problem of individual
production and wages lead to insistence on piece-
rates. All of tie Industry except hew York was
on a piece-rate basis in 19.23, and five years later
New York adopted the practice. It is asserted by
hr. hillman that the adoption of piece rates by
the Industry standardized output and made a minimum
of earnings certain.
Loss from strikes was offset by setting up impar- '
tial machinery for continuous arbitration. The
impartial chairmen of the various market areas be-
came both mediators and 'conciliators.
The mechanization problem was' attached jointly by
employers and employees. The Union recognized
tl at resistence to new machinery and labor-saving
devices weakens the competitive position of union
employers and dLainish.es employment by the effect
of - -igh prices on consumer demand, hence, the
Union encourage - , improvements but maintained a
measure of control over them as oy "permitting
the introduction of pressing machines only in re-
lation to the capacity of tie Industry or of a
particular shop to abosrb the displaced workers."
Arrangements for payment of dismissal wages some-
ti... s amounted to 5-500 for a displaced worker.
?732
-106-
In this. connection, Lir. hillman recalls the in-
stance of a displacement of IjO workers in one
Chicago plant over a five-year period by tech-
nological improvements.
The problem of waste and overhead was attacked,.
Attempts were made to eliminate waste and unnec-
essary overhead and to pro- rate the benefits to
workers. The workers assumed mora and more re-
sponsibility for increased quantity and quality
of output. This led to a changed attitude upon
tie part of the worker to his job, and even led
to the setting-up of a few shops run by the
Union.
The Amalgamated established a measure of security
for the workers at the time of a falling in vol-
ume of production by an equal division of work
principle. Also, factories having contractual
relations with unions usually provide for tenure
of employment, i.e., a worker is usually perman-
ently attached to a factory, after a probationary
period, and may not be discharged except for
cause.
In order to meet the basic insecurity of business
unemployment insurance was provided for by the Amal-
gamated. This began in 1923 in Chicago, and five
years later was established in Hew York and Roch-
ester. The Chicago plan, says lir. Hillman, was
"originally thought of as an incentive to greater
stability as well as a relief measure."
Lir. Hillman concludes: " ,'e have succeeded in mak-
ing both production and employment more regular in
normal times and in protecting employers and workers
to some degree from the worst effects of the de-
pression. .. .The 25 percent in the industry which
stayed out from union influence materially inter-
fered with the program which taree-f ourths of the
industry accepted and found workable
This proves first that voluntary cooperation in
economic planning is not enoughs and second, that
no one industry can stabilise itself entirely by
its own efforts."
"It is tie responsibility of the government to
create an instrumentality that will guide a
national economic plan. ". . .The problems calling
for large-scale planning are: "The length of
the working day and week, jobs for all people
willing and able to work, technologican unem-
ployment. ..A minimum wage to be paid in all in-
dustries. ..."
9782
-107-
XI. LLSCHIPTIOI Oj wISTLIBUTIC: CHAlil LS*
In men's clothin;, the ? rinelw.l 6ha els of distributioii include
Sre" ^consumer, and buying offices (fee and commxssion houses).
A. 7:o1'"-gs1c^s and J obbe rs,
"There is no single orthodox method of distribution.
Frequently manufacturers utilize a combination 01 trade
channels. ?cr example, in large cities manufacturers
of clothin- may find it desirable to own, *r at least
control in part their retail outlets. In smaller ci-
ties, they may find it best to use available, regular
retail channels or work through wholesalers who cater
to retailers in a particular vicinity. Manufacturers
may sell direct to large departmnet stores ana chain
stores, and distribute indirectly to retailers who
purchase in smaller quantities.
»***Iiirect selling has become the dominant method of
distributing men's apparel. In clothing end hats it
is usee, almost e::ciusi. ely***. The practice of c.irect
selling raises the related problem, the exclusive
agency. In other words, direct selling has mac,e ior_
selective selling. The -.ominanee of direct selling is
somewhat obscure; , because of the fret that many former
wholesalers of men's wear have become manufacturers,
and are distributing their ngres direct to retailers.
This is true of some prominent concerns in the men s
clotl-ir- trade vhi . h have been lookec upon as the
classi ^examples of wholesalers and jobbers. This move-
ment toward direct selling has tended to integrate the
market, e:^ today manufacturers control of retail out
lets is not uncommon. "(* *)
1. Seasons for Direct Selling K Manufacturers.
n***Fny is it that direct selling occupies so dominant
a position? Perhaps the basic reason is the nature of
the -oroduct. Most items of men's wear are of such a
seasonable nature, and possess such style elements, as
lenc themselves to this form of selling. Couplecx witn
this- is the localization of the men's apparel mcustry,
which makes it easy for retail buyers to go to the mar-
ket and uurchase a large portion of their oraers direct.
(*) Prepared by A. Prima Aaronnon, membei of the Men' s Clothing
Industry Stud; group, TextileU.it, Industry Studies Section,
Division of Review, ERA.
(**) Xenneth ^npmn- l,: fi r,; s "ear Mer chandising— The Ronald Press
Co. , New dork, 1930. Pages 370-371.
9732
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Further, the style risk is so great in some lines that whole-
salers cannot afford to carry a large supply. It is held in
some quarters that controlled buying may reinstate the im-
portance of the retailer. This will not happen in men's
wear. This "buying will continue to "be done "by resident "buy-
ers, by cooperative "buying associations and by retail buy-
ers, who go to the market.***
"One would normally expect such items as work clothing, where
the style element is lacking, to be distributed through whole-
salers, but instead of a large system of sectional wholesale
houses distributing these products we have system of section-
al manufacturing plants supplying directly the needs of re-
tailers of a particular district. There still remain, how-
ever, a considerable number of products which wholesalers do
distribute.***
"Many wholesalers, while still operating under the business
name of wholesaler, are also engaged in manufacturing, and
they sell their products direct to the retailer. In only a
few cases do they sell to other wholesalers.***
"Many of these concerns started out as manufacturers of a
very few items, and were -known to the trade as wholesalers.
In more recent years, seme of these firms have gone back to
manufacturing exclusively, Other concerns interviewed
started cut as retailers, later went to wholesaling, then to
manufacturing . ***
"Most of these former wholesalers have turned to manufactur-
ing because of competitive conditions, opportunities for
greater profit, ease of selling goods of their own manufac-
ture; in some cases, they turned to the manufacture of cer-
tain items which had been discontinued by producers for ^hom
they themselves were distributing.
"Wholesalers of men's apparel are finding it advisable to
(1) develop their own brand; (2) establish' control of their
outlets; (3) act as resident buyers for a group of retail
stores; and (4) organize and supply cooperative retail buy-
ing associations." ( *)
Jp to the end of the nineteenth century, or at least prior to the
advent of the automobile, wholesalers as a* class constituted perhaps the
most powerful single factor in the business.. They knew the needs of their
trade, bargained with the producers for their stocks, often financed the
manufacturers, sold the major staples of their line under their private
label, sent their emis aries over far-flung territories, financed their
customers and in manifold directions wielded a tremendous influence.
( *) Clark, FredE., Readings in Marketing, New York, The Macmillan Co
1933, pages 311-312. (Adapted .from ..Kenneth Dameron, Men's Tear
Merchandi s ing . )
9782
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"With the darn of the twentieth century, two comparatively new forces "be-
gan to e::ert a definite and unfavorable influence uuon the fortunes of
the wholesaler — the automobile and advertising. ***The automobile served
to eliminate the chief denendence uoon railroads for transportation of
persons and goods. ***Re,;'istration of motor vehicles in the Unitea States
jumped from 8,000 in 1900 to 450,000 in 1910, to 8,225,000 in 1920, to
23,000,000 in 1930.***
"*** Individual consumers as well as retailers found it increasingly poss-
ible and profitable to explore nearby towns and more distant cities. Such
excursions developed new tastes, new desires, left the consumer less will-
ing to be satisfied with what the local stores provided and the retailer
less ready to submit to the dictates of the distant wholesaler as to
quality, style, and brand of the goods he wa.s to handle.
"That new independence found a. ready ally in the rising popularity of
national advertising***.
"Wholesalers found it no longer possible to hold the -..esires of their re-
tailers ana their consumers within the narrow limits of their own lines.
Instead, with increasing frequency, they found themselves confronted with
the demand for a specific brand of goods, in specific sizes, often a.t a.
specified price. Advertising was beginning to change and sh pe the demand
of the American Consumer.
"The wholesalers were rapidly losing control over their market, losing the
freedom to choose what goods they would handle*** the majority of whole-
salers***simply disregarded what was going on around them and continued to
do business in the same old way.
"As the direct result of their lethargy, many were forced out of business.
In some lines the process of elimination was speeded by other factors.***
Shoe, hat, clothing wholesalers all saw chains invading their field and
capturing an ever-increasing -oortion of available business.***
"Wherever wholesalers have survived, their places of business, their busi-
ness psychology, their internal business metnods and procedures of today
generally bear but a fleeting resemblance to the old establishments of the
former days. These modern wholesalers have learned to recognize that re-
gardless of what name a system of distribution may carry, so long as goods
are not consumed at the point of their final productions there must ensue
certain processes of handling, transportation, warehousing, etc., which
become increasingly more indispensable and complicated as the distance be-
tween point of production and consumntion widens. ***"*
(*) 0. Fred Host, Distribution Today (New York, 1933) pages 30-32.
9732
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B. Retailers .
1. Lepartment Stores(*)
"Department stores as a group registered a reasonable and
wholesome rate of growth ap to' trie period of the World War.
During the ten_.ye'ars following the war they expanded in
numbers as -.ell as size of individual units in a manner
that reflected a state of unbounded, perhaps even wild,
optimism on the pert of department store executives, as
to the future opportunities of such type of retail estab-
1 i shmen t .
"i.iany nev/ and larger buildings v/ere erecteo.. Existing
buildings were enlarged, modernized, recontrncted or re-
furni shed. ***
"These increases in physical plants and equipment were
paralleled by growth's in the development of more com-
plicated methods of organization, procedure and customer
services. ***
'Thus department stores reached the end of the boom era
while carrying an unprecedented burden of new expenses.
Their cost cf maintenance of plant and equipment had mounted
through increased interest charges, higher taxes, more
insurance, repairs anc re ilacements, and the operating ex-
penses of each department nad grown suostar-tia.lly through
the addition af new functions anc more elaborate customer
service. "
■Distribution methods were changing in all industries, but
in men's clothing ?ven more than others.
"The details are most interesting, they reflect the power-
ful forces at work in manufacturing today; namely the
"1. fight for control of distribution,
"2. the centrifugal forces leading to mergers, particularly
' di s t r i but ion me rg c i ■ s ' ,
"3. the apparently contradictory double tendency of priSe
levels both downward and upward,
"4. the tendency to 'jet closer to the consumer,
"5. the dominance of chains.
"There have been radical changes from the early rays up to the
present.
"Today a. famous old-time advertiser like Kuppenheimer is so
hard put in the struggle that the best he can to in a great
(*)0. Fred Eost, Distribution Tot ay(Hew York, 1933) pages 43-44.
9782
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city of ilew York is to distribute through Bloomingdale' s;
while Fashion Park Associates, using the new tool of the
distribution merger to shape a vertical trust of immense
sine, have cone to dominate Hew York and Chicago." (*)
T7e also find that large retailers are making financial alliances
with manufacturers of men's clothing, developing a vertical organization
of their own, "both sides using every means within their power to obtain
control of the metropolitan markets.
The idea of clothing manufacturers' owning or having an interest in
large retail establishments or of retailers' having an interest in manu-
facturing plants is not new. Up to comparatively recent months, John
David, A Slew York retailer, has had a financial interest in Stein-Bloch,
and TTallach 3rothers in Hart, Schaffner & Tar::. (**)
The chief reason for exclusive agencies in the men's clothing in-
dustry is that if a high degree of efficienc-' is to be reached between
the retailer and manufacturer a close relation is called for. This is
true in the small cities as "ell.
Hart, Schaffner & Harx are reputed to own or have a financial in-
terest in almost 400 stores throughout the country. This is not known
by the general public and it is because of this that the "double-label"
system is used; i. e., retailer and manufacturer label.
The ? L ichmond Clothing Company (Richmond Brothers) is one of the
largest manafacturers of men's clothing in the world, having (***)
62 of its own retail outlets, located mainly in the Kiddle T7est and South,
Another large manufacturer similarly situated is the Aplo Company, of
Rochester, Hew York, best known as the Bond Stores, with locations in
the East and ITorth Central states, gach of these firms, as '"/ell as
several others, operates on a single price unit; i, e., the cost of the
same qualitj' merchandise is the same in all of the company's retail
outlets; usually the various concerns offer two or more grades for con-
sumer choice.
These firms operate on the mass production or "Ford" system and
offer to merchandise men's clothing at lower prices than known hereto-
fore. Their stores are not pretentious or "showy" places, but sell the
consumer the idea that his money goes into the suit and not fimture-;.
It is for this reason that increasing numbers of men in the middle class-
es prefer to buy their clothing on the "Ford" principle.
(a) Direct to Consumer
This same principle is also employed in the house-to-house or di-
rect- to-consumer method of distribution of men's clothing. This
(*) Paul Freeman, "Changes in the Ken's Clothing Industry." Adver-
tising and Selling . (May 15, 1929).
(**) Freeman, supra.
(***) Fairchild's Retail Book (Fairchild Publications. 1934)
9782
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method of selling has enjoyed a healthy growth in recent years. The most
fertile field for this business is in the Southern and Western states
where several hundreds of thousands of garments are being sola each year.
In all probability this is due to the greater style consciousness of men
inthe cmallcrcities and towns who reac , hear, and see more of their city
brothers via. motion pictures, radio, automobile, and magazines. Then, too,
the local stores do not have the finances nor space that would enable
them tj stock a complete line of a. well-known brand.
House— to-house selling is one of the oldest methods of i istribution,
varying greatly in volume from year -to year.
"It seems that house-to-house selling of the ordinary staple
forme of merchandise, including food and clothing, develops
very rapidly curing and after a period of business depressions.
When business improves employment is greater and money is more
free, and house-to-house selling apparently declines.
"Baring the past 40 years there have ueen three active periods
of house-to-house selling; that is, periods in which this method
of i istribution to consu/iers has assumed proportions sufficiently
large to threaten the regular retail chaunels. These three
period::, were from 1894 to 1899, 1908 to 1912, and again from
■1921 ta 192"'. In each case the period of active development of
house-to-house selling followed a business depression. If this
explm tion is correct, it may be assumed that whenever there is
another business depression a. period of active house-to-house
selling will follow and that as business improves this method
of distribution may again decline in importance. (* )
Cincinnati is, or seems to be, the center of manufacture for the
house-to-house type of business.
An example of well-known companies to sell direct to consumer is
the Nash Tailoring Company of Cincinnati, Ohio, selling over 500,000
garments annually, having a price range from $18.50 to $50.00. Richmond
Brothers also use this method of distribution as well as through their
retail stores, the purchaser making his selection from sample, swatches
and being measured by the manufacturer's agent, who follows the manu-
facturer's printed directions on the subject.
2. Mail Order Houses.
The mail order business is the brain child of A. Montgomery
Ward, who in 1872 started sending out catalogues to farmers.
Montgomery Ward was a buying agent for the national Grange, a
fraternal and economic farmers-ran organization offering its members, among
other .things, the benefits of cooperative buying.
It was realized by the founder of this company that it was with
(*) Fred E. Clark, Readings in Marketing (Hew York, The Macmillan C*. ,
1933) page 51,.
9782
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difficulty that the farmer 30 t into town to shop. Also that in the
stores in snail towns stocks were ratr.rally limited because of their
loaation and the area of distribution served. By 1830 Montgomery Ward
& Company was doing a business in excess of two million dollars.
"In 18S0 Richard Seers and A. C. Roebuck, who had run a mail
order watch company formed the Sears,' Roebuck ■& Company. In
1908 Sears had caught up to Montgomery Ward and in 1920 was
over twice the size of its competitor. The mail order plan
proved extremely popular with those consumers who lived in
small towns, villages and on farms, for it gave them the
opportunity to' secure a wide variety of merchandise not
generally stocked by the merchants of their community.
"Another boon to the mail order business was the inaugura-
tion of the U. S. Post Office Department's rural free deli-
very service and parcel post service.
"Competition comes from manufacturers and smaller co-celled
mail order houses handling only a few specialized lines
such as wearing apparel, stoves, implements, etc. "(*)
"The decline of the mail-order business began with the ad-
vent of the low-priced automobile, . causing the dissappearance
of frontiers, and it gained momentum substantially in
direct proportion ""fcdh the increase in the number of motor
cars in public use and the increase in the mileage of the
improved country roads and paved highways. This meant that
the rural consumers, who up to then had been accustomed to
select their needs from the alluring pages of the mail-order
catalogues, were now riding in their automobiles over im-
proved roads to the nearest shopping town or city in in-
creasing lumbers. There they were spending their cash in
a store, while at the same time they could enjoy the thrill
of actually seeing, touching and trying on the things they
wanted to buy, end seeing the sights of the town in the
bargain. "(**)
Then, too, "the chain stores were crowding into the smaller towns as
well as the aetropolitan centers. Firms like J. C. Penny, W. T. Grant,
Woolworth 1 s and Kroger were expanding a.t a rapid rate.
Certain circumstances caused the two large mail-order firms to
look for business outside of their usual channels and to open up retail
stores. One was that if one of them bought a large amount of high-
priced goods and put out a catalogue setting prices for six months and
■their market falls, that firm is in for a drubbing. The decision to
open retail stores was first made b; Sears, Roebuck & Company (first
opened in 1225 in Chicago). Montgomery Ward countered with a plan to
open 1500 stores. They had 36 stores by the end. of 1927. Ileither of the
(*, -crru-.e, Jbnuary, 193C .
(**) 0. Fred Rose, Distribution Today (New York, 1933) page 86.
782
-114-
concerns established the number of stores they originally planned. The
maximum number of stores report ec' by Montgomery Ward & Company (*) was
556 at the end of 1930, and by Sears, Roebuck & Company, 378 stores at the
end of 1931.
The two companies experienced a number of difficulties due to their
newness in the retail business and because it was difficult to divorce
themselves entirely from mail-order -ideas and adapt themselves to retail
selling in a short space of tine.
Both mail-order houses have reduced the number of stores in opera-
tion, Montgomery Ward £. Comoany reporting 439 in 1933 as compared with
556 in 1930, and Sears, Roebuck & Company having approximately 352 stores ■
as compared with 373 in 1931. Meil order and store sales by Montgomery
Ward & Company may be accepted as reflecting the trend of proportions for
both companies.. (**•')
Hail Order Retail
1926 183,300,000
1927 138,680,000 27,002,400
1923 130,200,000 58,100,000
1929 „ 10,800,000 116,500,000
1930 111,700,000 137,400,000
1931 81,300,000 113,900,000
1932 68 .tOO, 000 107,900,000
1933 78,000,000 109,600,000
1934 106,000,000 (est.) 144,000,000 (est.)
Compared with the total shown by the 1930 Census of Distribution,
the combined 1929 sales volume of Seers, Roebuck & Company and Montgomery
Ward £, Company represented approximately 1.3 per cent of the total
retail sales in the Inited States.
C. Resident Buyers .
There are bout three thousand department and specialty stores in the
United States which have Few York buying affiliations of some kind.
The Association of Buying Offices, Inc., is an organization of
central buying for department arid specialty stores doing well over a
billion dollai s annually. Its membership is composed of three types of
buying offices; those representing s store yr group of stores having
joint ownership, those cooperatively functioning for a group of independent
stores, and those privately owned whose services are offered to independent
stores on a fee basis, (***)
(*) 0. Fred Rost, B i s t r i b ut i o n To day (New 'fork, 1933) page S3.
(**) Fortune , January, 1935.
(***) II. I. Kleinhaus, Executive Secretary, Association of Buying Offices, Inc.
9782
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"The purpose of the Association in port is to inculcate just,
ethical principles of trade ant promote fair dealings in all
matters relating to the business, trade and affairs of the
members and/ or their principles; to secure freedom from and
abolish unjust anc unlawful practices, abuses and exactions
of every kind, $tc. "(*)
I
"The largest and most important operators, from the viewpoint
of manufacturers distributing nationally, are the 1£ leading
group and resident buying organizations which represent ap-
proximately 460 stores, exclusive of duplication. The total
volume of purchases of these organizations is unknown, but
the proportion of total purchases of any one store placed
through the central office varies greatly—with the merchan-
dise, with the store, "and with the character of service main-
tained by the central office.
"Contrary to popular impressions^ resident and group buying
associations do not buy the majority of goods purchased by
member stores. The percentage of certain houses ranges from
around two per cert for ready-to-wear to as high as 75 per
cent for some staple lines. Unless the central office is
buying for a true chain organization, a substantial propor-
tion of all important lines of merchandise is still purcha-
sed by the individual store buyer.
"Likewise contrary to general impression, the action of the
central ofiice in purchasing any line of merchandise does not
take the place of wholesalers and mill agents in the distri-
bution scheme as a whole, or in the selling to individual
stores who subscribe to the services of a market represen-
tative; and the action of the central offices does not sty-
mie the buying arc selling opi ms as it is thought to do.
"It is also a fallacy that manufacturers' salesmen cannot
go direct to the store buyer and sell him the sane character
of merchandise as is being purchased to greater or less
extent by the Hew York office of that store. They can and
they do.
"There are no clearly- defined lines dividing the proportion
of orders placed through the central office and those placed
in the market or with road salesmen by store buyers. The
proportion of an;; merchandise purchased through the market
representatives, end the number of departments for which
such purchasing is done depends upon (l) the character of
central office, (2) the character and location of the client
and .stores, and (o) the facilities of the central office,
or the. type of agreement v?ith tin member stores.
(*) H. I. Kleinhaus, Executive Secretary, Association of Buying
Offices, Inc.
9732
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"Kinds of Central Offices
"The resident buyer is a market expert selling his services
in the location, appraisal, end' selection of merchandise for
independent stores on a salaried or commission oasis, and is
limited in his purchasing to the individual.. orders of, or
the acceptance of his selections jy the client stores.
"The group, or syndicate, association is generally owned out-
right by a group oi stores and is empo'.3red to buy for the
r;roup such portion of any line or such amount nf any merchandise
as the member stores a ree upon.
a
"The her; York office of one or more corporate «af filiated
stores functions much as the group association, and differs
only in its smaller size and lesser power.***
"Centralized buying originated with the realization that
staple merchandise could be purchased through a central
source to the aavartage of individual retail merchants. It
was later extended to include style merchandise in order
that retailers might lessen the chance of loss from excessive
markdovns on improperly purchased goods, from high adverti-
sing costs to sell the mistakes of buyers' judgments, and
from public fickleness.
"The central office system has developed, not from a desire
to - ? change sources oi purchasing, but because of an economic
need on the part of large stoves to place some of their pur-
chases more directly, pnd to obtain certain services not
provided by the old-line systems of distribution.
"■Limitations which develop in the system of market represen-
tatives come, not so much from fruits in the method itself,
as from the conformity of all stores to one standard of
merchant" i sing.
"It was natural that the system should preserve its identity
and justify its early intentions bj extending its operation
to include practically all kinds of merchandise ssld by depart-
ment and dry goods- stores. This brought centralized buying
organizations into what appears as competition with some',
but not all, of the business of the wholesaler. Mare lately
ifxhas' indicated duplication with the salesman's functions
before the retail store buyer.
The group 'buying association is outstanding today because .
of its unique purchasing power. What group association
elects to yurchase is purchased for- each member stire,
while what the resident buyer selects to recommend tn his
clients is not sold to then unless they, in turn, are wil-
ling to accept it.
9782
-117-
"Generally speakin ;, what the group ouys is taken by all of
its member stores, while the resident buyer generally places
individu rders for Lis respective clients, or purchases
quantities under favorable conditions end makes them availa-
ble to his clients as Hhey. 'needs arise; rarely does be buy
for all of his stores in one operation.
"Both the resident buyer and the group or syndicate in many
cases have developed to such en extent that they can buy any
merchandise they want, from practically any source, and in
any quantity. Their units of purchase, representing the
,^e needs of several very large stores, are of such
tremendous market significance that the group is, by rights,
a preferred ci'stomer of the manufacturer anc" established
relations are highly important.
"As the central buying office increases its operations, •'
which is the intention of these organizations, its impor-
tance in the distributive system must be reflected in the
policies of manufacturers. Resident buyers and group as-
sociations must be recognized as economically justified parts
of the orthodox distributive sys-tem,' 'hot as competitive to
it nor as predatory to its older components.
"But it should also be remembered that while central offices
are powerful f; ctors in the distribution of department store
merchandise, thej have not succeeded is displacing the store
buyer and they are not functioning 1> per cent in the pur-
chase of department store lines.
"Whether the central office buys 75 per cent, or two per
cent, of risj line of goods for 'any one or several of its
member stores, the remainder is purchased as usual by the
individual action of the store buyer — either from lis desk
in the store or upon his visit to the market centers. This
fact is not always known or appreciated by the manufacturer's
or wholesaler 1 s salesman.
"Over— emphasis of the extent ana importance of central office
purchasing has caused many to lose sight of these facts. While
there are some 2500 stores affiliated with central offices
of various hinds, and their purchases through those offices
are indisputably important ones, there are over 30,000 addi-
tional worthwhile independent stores which do not have central
office connections.
"Some of these purchase only a quarter of their goods from
wholesaler.; oirchase practically all from the jobber;
all use many sources of information and supply other than
market repx'esentatives«
"T . se are the merchants wl am manufacturers must sell
through wholesalers. They, like their big brothers in the
group associations, must be contacted and served in much the
seme -.ir-j chat they have been curing the last quarter century..
/
9782
-113-
"We do not, therefore, have in centralized buying a form of
distribution talcing the place of established systems, un-
economically competing with established systems, nor incom-
patible with the long- established and successful relation-
ships of manufacturers with their customers.
1. "The Attitude of Manufacturers.
"There is no doubt but that the growth on centralized buy-
ing in its many forms is sn established fact; likewise,
that, from every responsible indication tocia.y, distribution
through central offices will become even more coi uuon in the
future. Complications in distributive policy and dealer
relations will naturally present themselves an manufacturers
learn to recognize this factor in distribution; but the
newer buying methods are entirely sound, and are here to
stay. They cannot be successfully combated nor ignored
by producers.
"Harmonious relation 1 ; with all distributive factors must
be developed er.o. maintained .
"Dissatisfaction occasionally is expressed by wholesale
distributors, ant' manufacturers distributing the bulk of
their goofs through jobbers often feci that to sell to
resident a nc" .roui buying houses constitutes direct compe-
tition with jobbers and with that portion of goods, which pas-
ses (or is intenc.ed to pass) through the hands of whole-
salers.
"The manufacturer naturally wishes to feel that he is pro-
tecting his wholesale representatives, because they long
have been and still are the chief ..'art of his selling orga-
nization. There are reasons, however, wiry the central
"buying office should not be frownec upon, and why the pro-
tection of .'jobbers cannot be carried to an extreme. Just as
in those cases where the largest retailers are not properly
served by wholesalers, and demand the right to purchase di-
rect from the manufacturer, stores which have assigned the
buying of any lines of merchandise — or the purchase of any
jiven quantity — to a central office present a situation
which must be accepted by the producer.
"If the resident or group association is the established
custom with certain retailers, and if it is remembered that
neither the resident nor group buying office affiliation
really stymies the purchase of ,-oods by the store buyer, it
is clear that for the manufacturer to discriminate against
the sale or his goods through central offices would be un-
sound.
"It would be no more justifies! for the producer to contest
the presence of the central office than for him to forego
the v'oltane obtainable by selling direct 'Ito large department
9782
-119-
stores, merel; L rder to favor a complaining jobber who
feels that the large store is his customer because it is
in his territory.''
"To refuse to sell to central offices, to placate whole-
saie distributors with promise of discrimination against
the groups to feel that manufacturer's salesmen cannot ap-
proach the buyer whose store has central office connections,
or to assume that all pro dn.ee rs do not have an equal chance
to sell the central office, is wrong. To take the attitude
that centralizing is equivalent to mechani zalizing, and that
th e orthodox methods of contacting, developing, advertising
to and cultivr.tin--; customers are becoming obsolete is an un-
gual i f i ex. m i s t rk e . •
"To react in any of the above ways to the central office
factor in distribution cm result only in harm to the manu-
facturer. It will limit his outlets, obstruct the consum-
mation of ri htful business volume, narrow his opportunities
fore ale?, occasion open opposition, or mere disregard, from
the central office organisations; and resistance will not
result in the development cf more pleasant or profitable
representation by the old-line cistribivtive factors.
"I have found no attitude toward manufacturers on the part
of the central buying offices which would justify the fear
of them that some manufacturers seem to hold.
"I an of the opinio that more of the fear of selling through
resident and group «,r v ing associations is occasioned by over-
emphasis of the theoretical contingencies of doing so than
Qj actual fa.ct.
"The central offices which occasion the worry of those manu-
facturers ' accustomec to uninterrupted distribution through
wholesalers display a genuine appreciation of the necessity
of maintaining mutually satisfactory relations with manufactu-
rers end their selling agents, and of the manufacturers'
maintaing r i C entity with all distributors and purcha-
sing factors. They recognize that there is enough business
obtau.-c . . rough each of the many channels of distribution
to assure the continuation of each to make each useful to
the manufacturer am" the retailer.. "(*)
(*) Gordonh. Bush, "How the Resident Buyer Functions, n Advertising
and 6 ell in- , Volume 13, ITo. 4 (June 12, 1929) page 17.
9782
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XII. MATERIAL AND GARMENT STANDARDS IN THE MEN'S CLOTHING INDUSTRY. (*)
The records show no uniform material and garment standards for this
Industry. That standards are necessary for the protection of the honest
manufacturer and the customer has teen fully recognized by the manufactu-
rer, retailer, and consumer.
Reliable manufacturers are insistent upon knowing how their raw
materials will behave during the manufacturing process. The consumer
likewise wants to know how an article will perform and how durable it is.
The following standards have been suggested as a start; and the
acceptance by this Industry of even one of these would be a long step in
the right direction and, it is hoped, lead to the full and proper standard-
ization of the Industry:
1. Measurements
II. Fibre Contents
III. Shrinkage
IV. Color Fastness
V. Proper labeling to cover the above.
A . ' Measurements .
"The purpose is to provide standard methods of
measurement, standard measurements and tolerances for
the guidance of producers, distributors, and users, in
order to eliminate confusion resulting from a diversity
of measurements and methods, and to provide a uniform
basis for guaranteeing correct size." (**)
Miss Ruth O'Brien, of the Bureau of Home Eco.nomics, United States
Department of Agriculture, has given this problem a great deal of study.
The following excerpts have been taken from her article, "An Annotated
List of Literature References on Garment Sizes and Body Measurements" :( ***)
"The marked growth of ready-to-wear clothing has
brought with it many difficulties in the proper sizing
of garments. (Fage 1.)
(*) Prepared by C. C. Boyden, member of the Men's Clothing Industry
Study group, Textile Unit, Industry Studies Section, Division of
Review, N.R.A.
(**) Recommended commercial standard for circular flat knit rayon under-
wear adopted by the General Conference of June 24, 1931. (Men's
Clothing Code Files.)
(***) United States Department of Agriculture Miscellaneous Publication
No. 78, May, 1930.
9782
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"Some of the difficulty is due to the practice
of "skimp-cutting" garments in order to undersell
competitors. Some is due to the lack "f uniformity
in the sets of measurements used by different manu-
facturers for the same specified sice of ago. The
greatest trouble of all, however, lies in the fact
that, with the exception of one study made by the
United States War Department (Ireland, Davenport,
and Love "Statistics Fart One, Army Anthropology")
in an effort to establish proper sii'es for uniforms
(during demobilization after the World War) they
directed the measurements of 100,000 men, taking
those measurements necessary for uniforms. This was
done according to scientific methods, and is the only
published report of a study of this kind made with clo-
thing construction definitely in view) , no scientifically
determined measurements have ever been published wnich
could be used for clothing construction. (Fages 2 and 3)
"The measurements now in use are apparently the
result of traditional practices somewhat modified in
accordance with complaints received by manufacturers
and influenced more or less by data of doubtful value
that have come from various sources, although some
clothing firms may have conducted investigations from
time to time and perhaps are holding the results as
trade secrets, it is unlikely that any considerable
number of these were maae by trained anthropometrists
and the results properly analyzed by statisticians.
In fact there are many indications that ancient ideas
of -proportions are still being relied upon. (Fage 2)
The great importance of taking all body measure-
ments according to the best anthropcmetricr.l methods
cannot be too strongly urged. If tne examiner has not
been trained in locating body landmarks and taking
measurements, and if the instruments used are not accu-
rate and suitable, the results are worthless.**
The methods and instruments of the science have been
very carefully worked out, and it would be necessary
only to decide upon different body landmarks to make
them applicable to the studies needed to establish
measurements for clotning construction. (Fages 3 and 4)
Measurements Now Used in the
Clothing Trade.
"The publications on measurements used in the
clothing trade are apparently limited to discussions
of proportions and systems of drafting devised by
various workers. The proportions recommended seem
to be based entirely on traditional ideas and not on
actual measurements of individuals. In the few cases
in which such studies are mentioned, no details of pro-
cedure or data are reported. It is therefore impossible
to evaluate the conclusions drawn. *** » (Fage o)
J?82
-122-
That a start toward garment standardization has already been made
is shown by the following excerpt: (*)
"Garment Sizes
"A number of Commercial Standards relating to
dimensions of ready-made clothing have been established
under the auspices of the Bursa of Standards: Minimum
measurements for boys' blouses, waists, shirts, and
junior shirts (95); (**) knit underwear (other than
rayon) (102); (***) and men' s pajamas (89). (****)
The measurements agreed upon by the manufacturers
and issued as these standards were bpsed upon surveys
made of the measurements being usei by manufacturers
before the standards were established."
B . Fibre Contents .
For the protection of the grower, manufacturer, retailer, and con-
sumer, it is important that the fibre contents of the material from which
the garments are made should be shown on the garment, at least as to the
basic product (wool, cotton, etc.).
It should be -possible for the clothing manufacturer to know the
composition of the cloth h« purchases. In lieu of any definite "Service"
standard, a statement of the percentage of wool and cotton would seem a
minimum requirement which need add practically nothing to the cost of
the clothing.
(*) "Present Guides for Household Buying" by Ruth O'Brien, Chief,
Textiles and Clothing Division, and Madera M. Ward, Assistant
Econcmist, Economics Division; Bureau of Home Economics. U. S.
Department of Agriculture, Miscellaneous Publication No. 193,
April 1934- (Fa>?e 16)
(**) (95) - Bureau 'of Standards - 1931, Boys' Blouses, Button-On
Waists, Shirts, and Junior Shirts. U.S. Dept . Com., Bur. Standards
Com. Standard CS14-31, 16 pp., illus.
(***) (10?) - Bureau cf Standards-— 1332.. Knit Underwear (Exclusive of
Rayon). U. S. Deit. Com., Bur. Standards Com. Standard CS33-32,
49 pp. , illus •
(****) (89) - Bureau of Standards — 1930. lien's Pajamas. (Made from
Woven Fabrics.) U.S. Dept. Com., Bur. Standards Com. Standard
CS15-29, 12 pp. , illus.
9782
-12S-
The consumer, as a general rule, if financially able, prefers
clothes of all wool construction, as against inferior fabrics. Without
the proper labeling of the fibre contents of the goods from which the
garments are made, the consumer is forced to depend for his information
regarding the quality of the clothing he is buying on the salespeople,
who may know very little regarding that which they are offering the
customer.
In vool fabrics, the fibres used generally characterise the aprear-
ance and durability of the finished goods. EfcibriSs made of wool, cotton,
shoddy, and other substances differ from each other due to having passed
through different processes of manufacture. There also arises a differ-
ence in the several fabrics due to the individual characteristics of the
fibres of which they have been separately made.
Marking fibre contents would tend to bring the price between all
wool fabrics and those with less or no wool and those containing re-
worked or reclaimed' wool into closer price adjustment.
The use of substitutes for wool affects the quality of the cloth
produced as to the warmth, elasticity, durability, and strength. Tne
showing of the fibre contents will aid and protect the consumer in the
selection of his clothing, and afford the manufacturer, retailer, and
all others in the Industry an opportunity to sell their garments on
their true fibre contents.
Theoretically the most effective agencies, and they are many in
number, are naturally those created by the Federal, State and Municipal
Governments, the reason being that they are answerable only to their
governments. Their duties and activities are defined by law. In the
Spring of 1935 there was introduced into Congress the following:
"A Bill
"To protest procuders, manufacturers, and consumers
from the unrevealed presence of substitutes and mixtures
in woven or knitted fabrics and in garments or articles
of apparel made therefrom, manufactured in any Territory
of the United States or the District of Columbia, or trans-
ported or intended to be transported in interstate or
foreign commerce, and providing penalties for the violation
of the provisions of this Act, and for other purposes.
"Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
that this Act may be cited as 'The Truth in Fabric Act
of 1935.'" (*)
This bill is still before Congress, and will come up for consider-
ation again.
The Industry proposed an amendment to the Code of Fair Competition
(*) H. 7166 In the House of Representatives
S. 2318 In the Senate of the United States
9782
-124-
for the Wen's Clothing Industry, on which a hearing was held in Washing-
ton, April 15, 1935, as follows: (*)
"Article XII, Subdivision (d)
"The following provisions snail apply only to
'Tailors-to-the-Trade' and/or special order houses
of the Wen's Clotning Industry:
"1 - All samples of cloth shall be so labeled
as to show the content of the cloth so labeled.
"Fabrics labeled 'all wool' shall mean that the
fabric so labeled is 100 per cent wool.
"Fabrics labeled 'wool with silk decorations'
shall mean that the fabric so labeled shall be all
wool with the exception of the decoration, which
shall be silk.
"Fabrics labeled 'wool with rayon decorations'
shall mean that the fabric so labeled snail be all
wool with the exception of the decoration, which
shall be rayon or celaneise.
"Fabrics labeled 'wool with cotton mercerized
decorations' snail mean that the fabric so labeled
shall be all wool with the exception of the decoration,
which shall be mercerized cotton.
"All other fabrics not specifically included
above and containing wool and other fabric substance,
such as cotton, shall be labeled 'not all wool'."
No official action was taken on this proposed amendment.
The importance of marking garments to show the true fibre content
is brought out very forcibly in the following statement (**) of Mr.
Peter a Grossman of the Born Company of Chicago, Illinois, made in con-
nection with the proposed amendment to the Code covering labeling of
fabrics.
*** "The direct beneficiaries of such a provision
are that class which both this Administration and the
responsible leadership of our Industry have a duty to
(*) Transcript of hearing on amendments to the Code of Fair Competition
for the Men's Clothing Industry, held April 15,1935. Fage 23
(Men's Clothing Code Files)
(**) Transcript of Hearing on Amendments to the Code of Fair Competition
for the Men's Clothing Industry, held April 15, 1935. Fages 125,
126 and 127. (Men's Clothing Code Files)
9782
-12! -
protect; namely, the buyi ng ' pub 1 i c .
"Only a very small percentage of that
public has even semi-uxr..rt knowledge of
textiles. The average man is .completely in tue
hands of the seller in this regard, if a fabric
is sold to nim as wool, he accepts it as wool.
We feel that it is our obligation to sec: that he
gets wool when that is what he thinks he buys.***
"The aforesaid ignorance of the nublic as to
cloth content, its aforesaid dependence on the
representations of the vendor, make this a par-
ticularly easy field for sharp practice. And this-
the unfairest of nil fori;.s of unfair trade practice-
is definitely on the increase - due, as I see it, to
two factors. One is, of course, the depression, vhich
has made competition so desperately intense, and has
put added temptations on tnose wnose business principles
are not of the soundest, and at the same time has made the
public more than ever susceptiole to ostensible 'Bargains'.
The other is that the introduction of new fabrics, par-
ticularly the styling of cottons to look more and more
like woolens, nas made it narder than ever for the lay-
man to know vhat he is buying. I have seen so-called
'cotton worsteds' which ore the most remarkable imita-
tions of worsted cloth, yet which do not contain a
single fibre that was ever on a sneep's back. When
a line made from these cloths, advertised to be 'worsteds',
is offered to the public, it is little 'wonder that the
masses are taken in, and believe they are getting a sensa-
tional buy, when really the whole transaction is a miserable
sell. I feel I need scarcely say more on this topic.
The concrete provisions of our article speak for them-
selves. The purpose of them all is the same; that the
purchaser shall be told what he is buying. In a word,
we aim to give the public the same protection as it gets
from the Fure Food Act.***"
The following excerpts from a circular of tne Associated Wool Indus-
tries are also of interest: (*)
"WE CALL ATTENTION
"1. To a resolution adopted by the Board of Directors
of the National Association of Wool Manufacturers,
February 5, 1935, as follows:
(*) Circular of August 15, 1935. "Imitation is the Sincerest Form of
Flattery" by Associated Wool Industries. (Men's Clothing Code Files)
9782
-126-
"The use of a label on wool or part wool
fabrics is not obligatory, but if in labeling
or otherwise referring to such fr.brics the terms
'100$ wool', 'all wool' or 'wool' are used, the
following limitations must be observed.
" ' 100p wool' and 'all wool' are synonymous
terms and may be utilized only on fabrics made
entirely of wool with a 2$ tolerance for foreign
matter .
"The term 'wool' when used without qualifica-
tion may apply only to fabrics sometimes known as
'commercially all wool', containing not less than
95$ of wool ay weight, with a 2*fo tolerance.
"The use of the v/ord 'wool' in reference to
fabrics containing less than 95$ of wool by weight
is prohibited unless a guaranteed percentage of
wool by weight is stated. ***"
"WE URGE
our members to capitalize the superiority of
WOOL by properly marking piece goods tickets to in-
dicate the fibres used in the fabric. When the
fabric is allwool or largely wool, this information
should be given on the tickets, in accordance with
the standards adopted by the Association. Not only
is it worthwhile for the manufacturer to emphasize
the wool content himself but he should urge and, if
possible, insist that the dress, coat or suit manu-
facturer do likewise.
"The emphasis on the use of wool fibre will help
to increase consumer demand for wool fabrics. It will
help us also to successfully meet the competition of
other fibres."
6. Shrinkage
The importance of proper marking of garments to show to
what shrinkage treatment the goods have been subjected, is shown by the
statement of Mr. Herman Moritz, of the Manhattan Cloth Finishing Company
of New York City: (*)
(*) Transcript of hearing on amendments to the Code of Fair Competition
for the Men's Clothing Industry, held April 15, 1935. Fage 83.
(Men's Clothing Code Files)
3782
-127-
■ "The average piece of woolen material delivered
by the mills to the manufacturers of men's, toys' and
women's clothing contains from sixty to sixty-five
linear yards. This means that in the average piece
of material there are approximately one hundred square
yards.
"Wool is a live substance. Its natural tendency
is to contract when exposed to moisture. Exposing it
to the moisture of the air will cause it to shrink.
For this reason, manufacturers have found it necessary
to shrink the cloth made by them into garments. They
realize that a garment made from un shrunk material can
not possibly retain its dimensions.
"There are two universal forms of shrinking.
Ninety per cent of all woolen fabrics are shrunk by
steam. Where material is placed in garments of very
high value, and there is a desire on the part of the
manufacturer to obtain the maximum of shrinkage, the
serial is subjected to cold water shrinkage, which
will reduce the fabric so treated at at least twice
as much contraction as that which is obtained by steam
shrinkage.
"Shrinking materials by steam, which is called
sponging, will' show a contracting in length and width
of approximately 5 per cent. Cold wat er shrinking
will develop a contraction of about 10 per cent. This
rtitans that the average piece of woolen material contain-
: originally one hundred square yards will be reduced
irea by steam sponging to ninety-five square yards,
jold water shrinking is employed, only ninety square
.; . : Is will remain after shrinking. It is, therefore,
■ent that the unfair manufacturer effects a saving
. ' yardage which would be lost to him if the material
were shrunk."
Later in the hearing, Mr. Moritz stated: (*)
"When you just spoke about a different method of
shrinkage, other -than Sanforizing or sponging, it is
cold water shrinking of linens and cotton goods."
The Industry proposed the following amendment to the Code of Fair
Competition for the Ken's Clothing Industry, on which a hearing was held
April 15, 1335:
Transcript of hearing on amendments to the Code of Fair Competition
for the Men's Clothing Industry, held April 15, 1935. Page 92.
(Men's Clothing Code Files)
9782
-128-
"Schedule A — Froposed Amendments to the Code
of Fair Competition for the Men s Clothing Industry.
"7. No garment shall he manufactured of woolen or
worsted material or of summer and washable fabrics,
which have not been sponged in the piece."
This amendment as approved by the Code Authority reads: (•*)
"No men's or young men's garments shall be
manufact\ired of woolen or worsted material, or of
summer or washable fabrics, which have not been
sponged in the piece."
Excerpts from the statement (**) of Mr. Frank Stutz, Fresident,
Better Fabrics Testing Bureau, call attention to the increasing use of
unshrunk fabrics and also to the problem of stretchage.
"*** Tnis habit of the garment manufacturing
industry to cut up unshrunk fabrics is growing into
an evil trade practice that must be stamped out, in
order that the trade will return to the original
system of conditioning wool fabrics before manufacture
into clothing.
"The test records of this Bureau, which is the
official testing laboratory of the National Retail
Dry Goods Association, a trade organization of 5,400
stores, show that shrinkage of fabrics in consumer
use, cleaning, pressing, or laundering is the biggest
. probl'em of the consuming public today. It is an out-
right fraud; selling unshrunk fabrics and garments to
the consumer, because the customer cannot protect him-
self against selection of stretched fabrics for the
reason that it is impossible to determine whether a
fabric has been conditioned until used.
"The truth about shrinkage is that the problem is
really one of stretchage. Unscrupulous fabric firms
stretch their fabrics to gain extra yardage, and when
the consumer presses, cleans or launders such fabrics
the stretchage is lost, thereby creating a condition
commonly called shrinkage. Actually, the fabric has
simply returned to its original length and width, or
(*) Transcript of Hearing on Amendments to the Code of Fair Competition
for the Men's Clothing ■ Industry, held April 15, 1935. Page 69.
(Men's Clothing Code Files)
(**) Transcript of Hearing on Amendments to the Code of Fair Competition
for the Men's Clothing Industry, held April 15, 1935. Pages 109,
110 and' 111. (Wen's Clothing Code Files)
9782
-129-
natural dimensions of the cloth. ***Every consumer
is fully justified in asking sales people whether or n
not the fabric in any garment has been pre- shrunk
for normal service. If a merchrnt does not know
whether his merchandise is serviceable or not, he
has no right to serve as the purchasing agent for
the consumer in his community."
The statement (*) of Mr. Henry Moskowitz, Impartial Chairman for
the Textile Examining, Shrinking and Refinishing Industry, both National
and in the City of New York, gave his opinion as to the necessity of
proper shrinkage of the cloth and the position taken on shrinkage by an
important distributor of women's garments:
**** "I desire merely to state that disinterested
opinion has always regarded the examining and shrinking
of ?/oolen and worsted cloth as an absolute necessity for
its prorer conditioning before such clotn can be turned
into a manufactured garment. ***"
Mr. Moskowitz called attention to the following!
"This is an advertisement of the Textile Refinishers'
Association, Inc., of New York City, and refers to a
letter from the J. C. Penney Company of New Terk City...
(The Advertisement follows)
"J. C. Fenney Company states:
"'This organization has been exerting every possible
pressure on the manufacturers supplying us with women' s
garments made of woolens and worsteds to the end that
all of these goods used in our merchandise be properly
sponged and shrunk.'***"
That facilities for the proper shrinkage and conditioning of the
cloth, together with the organization to handle the work exists is brought
out in the statement C.**) of Mr. T. R. Trilling of tne American London
Shr inkers' Corporation:
"*** 'What are the standards of shrinking and conditioning,
as practiced today, and do they afford the proper protect-
ion to the ultimate consumer?
"As a member of the Committee of Standards, I can answer
that question "briefly and concisely. Shrinking and con-
ditioning, as performed today, has reached a standard of
(*) Transcript of Hearing on Amendments to the Code of Fair Competition
for the Men's Clothing Industry, held April 15, 1935. Fages 71,
72, 101 and 102. (Men' s* Clothing Code Files.)
(**) Transcript of Hearing on Amendments to the Code of Fair Competition
for the Men's Clothing Industry, held April 15, 1935. Pages 97,98,
99. (Men's Clothing Code Files.)
9782
-130-
such efficiency and perfection that I can honestly
say that such cloths, as are properly shrunk, can be
positively guaranteed against any further shrinkage,
in the ready-made garment, to within a shrinkage tol-
erance of one per cent. ***
"I can further state both truthfully and knowingly,
that never in the history of cloth shrinking and condi-
tioning has the Industry been so well organized and in
s\ich an advantageous position to carry on the uniformity
of the standards of shrinkage as is fulfilled today.
"I will even go a step further and state that never
in the history of clotn shrinking and conditioning has
there been such a concerted action, consistent effort
and definite move made on the part of any industry in
the country towards the establishment of a scientific
standardization of cloth shrinking and conditioning.
"With the able assistance of the Better Fabrics
Testing Laboratories, which is the official testing
laboratory for the National Retail Dry Goods Associa-
tion, and under the guidance of Mr. Frank Stutz, the
highly .efficient managing director*, the committee on
standardization hns' labored.' unceasingly and. conscien-
tiously to bring about a standard of cloth shrinking
and conditioning that we hope to have established and
recognised throughout the width and length of the entire
United States."
Shrinkage has been one of the problems of the Cleaning Industry.
Mr. George G. Gaubatz, Jr. analyst in charge of Research of the National
Association of Dyers and Cleaners of the United States and Canada, with
offices at Silver Spring, Maryland (*■)■ . writes as follows regarding
their position:
"In accord with your request after our conversation
the other day, we are pleased to set down briefly our
position as dry cleaners, on the question of shrinkage
in men's suitings.
"Shrinkage in men's woolens has never presented as
serious a problem to the dry cleaner as has woolens in
ladies' suitings and other similar materials. Cases
where shrinkage has taken place in ordinary dry cleaning
and finishing, have not been great in number, although
there seems to have been a tendency in this direction in
the last several years. Of course, when garments of this
kind are sufficiently soiled to require a water or wet
cleaning treatment, shrinkage is often encountered.
(*) Letter to C. C. Eoyden, October 12, 1935. (Men's Clothing Code
Files)
9782
-131-
"In any event, it has long been our impression that
cases of shrinkage in men's as. well as other garments, have
in a large measure "been due in many cases to failure on the
part of the manufacturer to properly .pre-shrink the material.
This has been further complicated by the practice on the part
of some manufacturers to actually r over-stretch the material
in original manufacture, and it is to this practice, especially,
that we feel the specifications should be aimed.
"In other words', we, as dry cleaners, feel that speci-
fications for proper pre-shrinking are most essential, but
believe that these should also be so worded as to eliminate
the practice of re-stretching the material after the shrinkage."
The statements quoted above show the necessity for the. 'adoption of
some "standard" method of marking garments, which would .show a guaranteed
pre-shrinkage treatment. This could be accomplished by some satisfactory
form of grading, as, for instance,
"A" - for full cold water snrinkage.
"B" - for steam treatment according to some definite procedure.
"C" - to show some minimum treatment.
D. Color-Eastnnss .
— is self-explanatory and would ref er : to all phases of color-
fastness to be expected from the fabric from which the garment is made,. :
under ordinary wear and exposure. '•
E. Labeling . '
La^ge, expensive labels are not necessary. It would be, suffic-
ient to use labels large enough to be easily seen, on which size, fibre
contents, quality of shrinkage and statement that the goods are or are
not color-fast are clearly marked so that the purchaser will know what
he is buying.
In this connection, it is interesting to note the following:
"Dr. D. E. Douty, Fresident of the U. S. Testing Co., Inc.,
speaking (*) before the_American Association of Textile
Chemists and Colorists at the Chemists' Club in New York
of 'Consumer Technical Information; Its Preparation and
Distribution' :
" 'In my opinion' , said Dr. Douty, 'the chief value of
compulsory labeling lies not in the technical information
given to and utilized by the ultimate consumer, but in
the restraining influences it exercises over the producer
and the direct obligation placed upon him in his relation '
to the regulatory agencies of the State and Federal Government.'
(*) Daily News Record, New York, New York, 10-28-35.
9782
-132-
"When the ultimate consumer is willing to pay the
premium for quality insurance, just a s he does his
life, fire or automobile insurance, he will obtain
the protection willingly and readily.
" 'He must be educated to the value of quality
insurance', Dr. Douty declared."
As indicating the great amount of work necessary to bring about the
establishment of standards, the following is noted: (*)
"Discussing the progress made to date in the movement
to establish commercial standards for women's dress
fabrics, in testing, reporting and rating for service-
ability, William D. Appel, Chief of the Textile Section
of the U. S. Bureau of Standards, in a brief address
delivered before the October meeting of the New York
section of the American Association of Textile Chemists
and Colorists at the Chemists' Club on Friday night,
stated that 25 sub-committees of the various scientific
and lay bodies involved in the work were contributing
their services in the effort to arrive at mutually
satisfactory standards, but that 'seme weaknesses had
been indicated and the need for much more work emphasized.' "
Much work is being done by the various groups making up the differ-
ent branches of the Industry looking towaid the standardization of their
particular operations. It is also interesting to note that the United
States Bureau of Standards is cooperating with various groups of manu-
facturers, distributors, and consumers,' locking toward the standardization
of size, measurements, shrinkage, color-fastness, and other criteria
indicating quality of garments and other apparel. It is therefore
reasonable to expect that at least some standards will be adopted by the
Industry.
(*) Daily News Record, New York, New York, October 28, 1935,
9782
-133-
CHAPTER III
PHE-CODE PROBLEMS OF THE INDUSTRY AND tfRITlFG- OF THE CODE
I. FRE->CODE PROBLEMS OF THE INDUSTRY
A . Decline in Value of Industry Product .
In 1923 the value of men's, youths' and boys' clothing produced in
the United States amounts 6 to more than a billion dollars. (*) Since
then there has been a consistent decline in value of output, until the
estimated value of production for each of the years 1933 end 1934 ap-
proximated $450,000,000. (**)
B. Productive Capacity of Industry .
"America's Capacity to Produce", published bv Brookings Institution,
quotes e correspondent to the effect that in 1929 the Lien's Clothing In-
dustry worked 30 to 35 full weeks out of 52. The analysis made of rea-
sons for the slack period is: SO per cent due to seasonal variation,
and 40 per cent due to lack of business. This publication gives an
operating ratio (men's and women's clothing industries combined) of: 63
per cent, not adjusting for seasonal variations, and 85 per cent, ad-
justing for seasonal variation. The 1923 Census places the operating
ratio for the Industry at 73 per cent.
The Brookings' study estimates that the per cent of practical capa-
city utilized in the lien's Clothing Industry was 73 per cent for the
period 1925-1929, and 76 ^er cent for 1929.
C. Employment an: Hours (***)
The lien's Clothing Industry, which is fairly "ell unionized, main-
tains two practices with respect to work. First, there is generally
practiced an eoual division of work in factories. Second, factories
having contractual relations with unions usually provide for tenure of
employment. That is, a worker is usually permanently attached to a
factory, after a probationary period, and ma _r not be discharged except
for cause. Because of these rules and due to the highly- seasonal
character of the Industry, an estimate of employment must be based on
the average number employed.
(*) Bulletin of United States Bureau of Labor Statistics, No. 557, page
33ff.
(**) Letter dated January 18, 1935, from George L. Bell, Executive
Director, Lien's Clothing Code Authority, to Deputy Administrator.
(Lien's Clothing Code Files.)
(***) Extracts from Affidavit of " r . S. vor Szeliski on Lien's Clothing
Industry, September 21, 1934. Bases on comprehensive and fully-
authenticated study by iiorris Kolchin. (Both in Lien's- Clothing Code
Piles.)
9782
,* -134"
In 1923, the highest number of workers employed by the Industry
was loo, 771. Prom 192' T until 1^29, the Industry employed fever workers
although the -ohvsical output was increasing. There were 147,595 workers
employed in 1925 end 153,550 in 1927. Although the United States Census
of Manufactures reports 12,926 fewer employed in 1929 than in 1923, some
of this number probably/- rep.iained attached to the Industry. Therefore,
it is reasonable to rsnume that half of the unemployed between 1923 and
1929; that is, 6,4S3; remained attached to the Industry in addition to
the 155,845 reported to oe employed at the height of the 1929 season,
thus indicating an available labor force of 162,308. Since few workers
are likely to have left the Industry since 1929, it appears that the
number of workers attached to the Industry in 1933 amounted to around
160,000. Also, since the greatest number employed in an v one month of
1933 was 111,745 for February, the probable excess supply of labor un-
employed (prior to the N.R.A.) in 1933 was around 48,000. ( *)
It is generally agreed that the above estimate of totally unem-
ployed in the Industry for 1933 is conservative because of the very sig-
nificant migratory movement taking place in the Industry during the
period in question. Plants moved or were discontinued in the large in-
dustrial centers and became established in rural areas. Workers often
did not follow the slants but remained idle while new workers were being
trained and employed. It ras estimated that 12,926 fewer workers were
employed ii 1929 than in 1923. In ITew York alone the m-imber of enroloyed
declined. 9,150. Tae total reported unemployed for ^ew York and Chicago
exceeded the indicated rational total, hence it is obvious that the
estimate of 160,000 attached to the Industry in 1933 is small. There
are not enough data, respecting the effect of plant migration on employ-
ment to make a close approximation.
It must be observed, of course, that the depression years not only
resulted in less employment but also in less work for the enroloyed. The
Bureau of Labor Statistics reported, more factories idle in 1932 than in
1929. "The operating factories snowed a greater degree of under- employ-
ment in 1932 than in normal years. In 1928 there were only 2.2 per cent
of the workers who had less than 20 hours of work during the sample week
and in 1932 almost four times as many, 8.7 per cent."
D. 7fa~e s . (**)
The wages of clothing workers for several years prior to the Code
had been affected by the actual decline in wages and the decrease in em-
ployment. "The actual nours of work declined 10 per cent from 1922 to
1932, thus affording less earnings even if the hourly rates had remained
the sajne. ."But the hourly earnings have adso declined. In 1922 the
average hourly earnings were 72.8 cents and in 1932 only 50.6 cent."
(*) Author's Note: This estimated was based upon 3.L.S. figures for the
first five months of 1933. Census figures now available show an aver-
age employment for 1933 of 119,253, the highest month being September
with an employment of 131,648.
(**) Extracts from Affidavit of 7. S. von Szeliski on Lien's Clothing
Industry, September 21, 1934. Men's Clothir.^ Code Files.)
9782
-135-.
Average annual earnings were thus unquestioncblv affected.
"The downward movement of the earnings of the clothing workers
outstripped all industries. It has boen continuous since 1923, so that
even in the prosperous years the purchasing power of the workers was
diminishing; with a decrease of 11 per cent in value of product from
1925 to 1929 the payroll decreased 13 per cent. The average annual
earnings during this period declined ah out 9 per cent. In 1923 the
wages of the clothing workers were higher than the wages in all other
industries combined, but in 1931 they were 15 per cent lower."
A comparison of the movement of wages in this Industry with the
cost of living, also shows up to the disadvantage of the wage earner.
"During the ten-yea- period, 1923-1932, wages declined 45 per cent,
whereas the cost of living declined only 2E per cent. Tims the index
of earnings of the clothing workers in 1932, in terms of cost of living
dollars, was about 00."
S. Extent of Unionisation.
One group in the Men's Clothing Industry, located principally in
the urban "centralized" areas is almost entirely unionized, having
working agreements with the Amalgamcted Clothing '."orkers of America.
The other group, located mainly in the small cities and country areas,
the "decentralized" areas, operate for the most part under working
agreements with the United Garment 'Jorkers of America^ To the last-
named, group belong a number of unorganized independent manufacturers
who operate open shops. (*) !.Ir. Sidne-/- Hi 1 Irian, President of the -Amal-
gamated Clothing "orkers, a.t the public hearing of July 25, 1933, testi-
fied that the Industry was SO per cent organized. As is pointed out in
Chapter IV, Code Administration — Organization and Procedure, the impor-
tance of union influence in this Industry is recognized by the extent of
representation on the ken's Clothing Code Authority.
F. Home T, r ork .
All proponents of codes for the .'en's Clothing Industry united in
a common understanding that the practice of home work was vicious and
demoralizing and should go. Mr. F. M. Curlee, of the Industrial Re-
covery Association, stated in the July 25-27, 1933 hearing that "...both
sides condemn this practice — all agree that it should be utterly stamped
out at the earliest possible time. The practice lends itself to evasions
and abuses, and is destructive of the reforms contemplated by the In-
dustrial Recovery Act."
"At the request of the Division of Research and Planning of
the H.R.A., the Men's Clothing Code Authority in August, 1934,
collected data with respect to the home work situation in the
Men's Clothing Industry, before September 11, 1933, the date
the Code became effective, and after its enactment. The
clothing markets of Rochester, Pnilo^c'i vi'da, and, hew York are
(*) "Statement - Industrial Recovery Association of Clothing Manufacturers J 1
February 2, 1935, page 2. (lien's Clothing Code Files.)
9782
-136-
represented in the data presented, which, while not complete,
are accurate so far as they go.
"In April, 1935, which was prior to the effective date of
the Code, there were 7,310 home workers employed in the
clothing markets mentioned. In August, 1933, there were 2,381
home workers in the same markets; and in April, 1934, the
amount of home work done was nil." (*)
G. Profit Margins .
Professor Nerlove's stud;'' of ore-Code conditions in the Lien's Cloth-
ing Industrjr concluded with res'oect to profit margins in the Industry
that: (**)
"Treasury Department figures show the narrowness of these
profit-margins even in prosperous years. In 1927 net in-
come of corporations in the Leu's Clothing Industry was
about 2.3 per cent of gross income; in 1923, it was ap-
proximately 5 per cent; and in 1929, it was about 2.8 per
cent. In view of the relatively high capital turnover of
this Industry, these figures indicate that on the average
the return on invested capital of corporations in this
Industry was only between 5 per cent and 6 per cnet at the
peack of industrial activity and national income, 1927 to 1929."
"Both the number and the size of failures during these
peak years were large. Dun's figures show that failures
measured in liabilities of 'clothing and millinery firms'
were approximately from 4 per cent to 6 per cent of the
total number of failures measured in liabilities of all
manufacturing concerns daring this period, 1927 to 1929, ' •
whereas the value of product of this Industry was only
1-g per cent of the value of product of all manufacturing
industries in 1929."
While the Men's Clothing Industry generally has been more stable
from the standpoint of maintenance of investment and return on capital
than the women's wear field, infinitely more sensitive to changing styles,
it would appear that for various causes capital began a systematic de-
cline in 1930, which continued until the fall of 1933 when the Industry
was codified under the ERA. (***)
(*) Statement prepared by the Code Authority for the Men's Clothing In-
dustry, as a "Memorandum regarding Homework, " April 30, 1935.
(**) Statistical and Economic Analysis Related to Sections II and V of
"Code of Fair Competition for the Men's Clothing Industry" — Clothing
Manufacturers Association of the United States of America., (Men's
Clothing Code Piles.)
(***) Remainder of this discussion of Profit Margins adapted from sur-
vey of A. A. Fisher. See explanatory note on page 59.
9782
-137-
In anticipation of effective date of G , ■■ d expected rise in the
price of raw materials, particularly woolens, in the Spring of 1933 there
developed a scramble of manufacturers to cover their anticipated re-
quirement? for the ifell season. Thosf "acturers "it 1 ; sufficient
capital, or credit, in April placed substantial orders with the distri-
butors of piece goods against the trend of rising wool costs and tied
up an unusual amount of crpita.1 in inventory. The usual practice there-
tofore had been to buy fifty per cent of the estimated requirements in
April for June and July delivery, and subsequently place fill-in orders
as reouired. Those manufacturers, however, who in April, 1933, placed
orders for woolens for one. hundred :>er cent of their season's require-
ments for payment -within sixty days, or sixty extra for those with
larger caoital, showed a satisfactory profit : r or the jrear 1933. This
was due to the steadily rising price of woolens which enabled the manu-
facturer, thus covered, to reap the advantage of a larger mark-up. The
advantage, however, was relatively shortlived, for it built a substantial
inventory at the end of 1933 Which in 1934 had to be sold at falling
prices. During this period an advantage ultimatelv occurred to the
manufacturer with limited capital who had been unable to acquire his
full season's requirements at the lower cost of woolens.' He had been
corn-celled, perforce, to buy in accordance with the former practice of
making commitments in April not in excess of fifty per cent of his re-
quirements, and, as the season progressed, paid the higher prices for
woolens reouired during the balance of the season. The result r; as that
while he did not make as much none:'- a.s his larger competitor in 1933,
his mark-downs in 1934 were materially less. The small manufacturer
who had stretched his credit to cover his total requirements in the
Spring of 1933 lost money when the volume' of sales fell off in the
latter months of that -"-ear, for he had to slash prices to rid himself
of excess inventory in order to avoid financial disaster. The manufacturer
with more substantial capital was affected by the same conditions "out
was better able to absorb his losses through a carry-over of merchandise
into 1934 and, with increasing demand, reduced his losses or showed a
small profit in that year. Thus, generally speaking, the small manu-
facturer with a capital of from $25,000 to $30,000, if careful in his
purchases, made a little profit in 1933; the medium- si sed concern with
a capital of from $50,000 to 100,000, which covered merchandise require-
ments one hundred, per cent in April, sust; ined a ret loss for the -ear;
while the larger concerns, with capital in excess of $100,00 were, with
some exceptions, able to show a net profit at the year-end.
Partial confirmation of the stated results may be obtained, by
analysis of the breakdown of operating figures of 243 manufacturers. (*)
Of 52 concerns operating with a capital less than $25,000, 49, or 79.03^,
reported an average net profit of 2.91$, the remaining 13, for one cause
or another, showing an average net loss in 1933 of 2.99;o. '.There capital
of $25,000 and xco was employed, 167 concerns, or 52.273, reported an
average net profit of 2.53 .>, while 14 others averaged a net loss of
l.Q5,L (**) ■
(*) See Tables XVI and XVII.
(**) See Table XIX.
9782
-138-
A further breakdown of the entire r-roup in6_icated varying results in
1933, as follows: (*)
Net "Torth -
No. of Cases
Up to
$2 r ,0C0
$50,000
$75,000
Total
$25, 000
to
$49 , 000
to
$74,000
and up
62
98
41
42
243
315,535
$35,510
$51,780
$154,429
$55,502
2.03$
n nr 1
2. oo >
1.97,5
2.57$
2.34$
49
89
39
39
216
No. Concerns
Showing Profit
$ of Concerns
Showing Profit 79.03,1 90.32$ 95.12$ 92.861 88.89,1
In considering 1933 operating figures, it should he kept in mind
that the relatively favorable showing of high percentages of concerns
reporting profits, however small, had these profits invested in year-
end inventories, the losses on which were taken in 1934. The picture
is better visualized from a study of three years' comparable results of
229 identical manufacturers whose year-end statements submitted to the
National Credit Office are summarized in the following composite review: (**)
Net 7orth 1932'
End of Year $14,026,270
No. of Concerns 229
Net Profit— Total -$1,439,009
Rate of Return -10.3$
(Loss)
,1 of Profit on Sales -3.5$
(Loss)
$ of Concerns Showing Profit 37.6$
$ of Concerns Showing Loss 62.4$
That losses of recent years in the clothing industry have not been
confined to the small or medium size manufacturer, but have been a heavy
drain on most large and well-financed organizations, is evident from an
examination of published figures of several large operators of "inside"
shops.
The accorapanving tabulation of profit ana loss figures of three of
the largest and best known manu fa c turing-wholesalers in Chicago eloquently
(*) See Table XVI.
(**) See Table XV.
9782
1933
1934
$15,089.
441
$1!
5,545,815
229
229
$1,393,
995
$791,546
9.2$
5.1$
2.7$
1.3$
•
90.4$
78.2$
9.6$
21 . 8$
-139-
testifies to the loss trend in the Industry, which began to manifest
itself in 1930. (*)
That there are outstanding exceptions to the loss record, without
belying the indicated trend of diminishing profits, is evidenced by the
record of annual net profits of one of the largest manufacturers — Rich-
mond .Bros. Company, in Cleveland, Ohio — (**) which operates also a
chain of retail shops, necessitating an investment of over $3,000,000 in
fixed assets.
II. TTRITII'G OF THE CODE
On -August 26, 1933, the President, upon recommendation of the Ad-
ministrator, approved a Code of lair Competition for the lien's Clothing
Industry The provisions of this Code as approved are summarized as
follows:
Section I defines the term "Clothing Industry. "
Section II provides a minimum rage o^ 40 cents oer hour in the
northern section of the Industry, and 37 cents per hour in the southern
section. Subsections a, b, c, d, e, and. f provide for the saf eouarding
of differentials above the rnininum, prevent increases in amount of work
to avoid benefits to employees, and authorizes the Code Authority to
appoint a committee to supervise execution of the wage provisions.
Section III abolishes home rork.
Section IV establishes a 35-hour week for manufacturing employees
and a 40-hour week for non-manufacturing emplo-/ees and provides for over-
time in the subdivision of the Industry known as "tailoring-to-the-trade"
and uniform manufacturers.
Section V provider for the use of an F.H.A. label to be attached to
all garments manufactured under the Code.
Section VI forbids employment of any person under sixteen years of
age.
Section VII provides for compliance with conditions of sanitation,
etc. , as specified in factor;/ laws of the respective states.
Section VIII provides for collection and publication b" - the Code
Authority of certain information.
Section IX authorizes the Code Authority to aid in making equitable
adjustments in respect to contracts entered into before the adoption of
the Code.
Sections X and XI provide against selling 1 below cost.
(*) See Table XLVI .
(**) See Table XLVI.
9782
-140-
TA3LS XLVI
Net Profit or Loss after ail charges /a °^ 3 la.rge Chicago Manu-
facturers of Lien's Clothing.
Alfred Decker
Hart, Schaffner
& Marx
1935
$ 273,824
1934
d
668,259
1933
#d
2,238,567
1932
d
3,915,729
1931
d
2,994,580
IS 30
X
504,142
1929
2,514,576
1928
2,583,798
d
d
d
d
B,
, Kuppenheimer
&
Cohn, Ii
&
Company,
Inc.
$
25,735
d
$
182,570
222,121
d
122,158
776,980
+d
877,182
138,314
*d
474, 103
278,970
d
263,131
641,016
302,924
514,892
249,672
d - Fet Loss
# - Including $1,555,012 in respect of capital assests, etc., written
off by subsidiaries liquidated during year and provision for antici-
pated losses on capital assets, etc., of subsidiaries to be liouidated.
x - After $1,000,000 reserve against investments.
+ - Before $213,061 write-off of investments and advances. Additional
reserves therefor and other charges and $150,000 contingency reserve,
both charged to surplus.
£ - Before $578,538 extraordinary charges carried to surplus.
/a - Figures published by Fairchild's Financial Manual issued I. lay, 1935,
pages 26 and 27.
let Profits
Richmond Bros. Co., Cleveland, Ohio Jjo
1934
$1,320,574
1930
$3,085,216
1933
1,719,551
1929
4,203,037
1932
1,460,379
1928
3,571,146
1931
2,025,639
/b - Figures published by Fairchild's Financial L'ianual issued May, 1935,
page 29.
9782
-1- bi-
section XII prohibits scles on "consignment" and the practice of
"cut, make, and trim. "
Section XIII provides for the establishment of a Code Authority
and confers upon it certain powers.
Section XIV incorporates the mandatory provision of Section 7 (a)
of the Act.
Section XV states the President's rights to c; ncel or amend any
provision of the Code.
Section XVI provides that the National Association of Uniform
Manufacturers shall be given administrative powers in respect to uni-
form apparel.
Section XVII provides for the eliminating or changing of codal
orovisionc, with the approval of the President, shoulc circumstances or
experience indicate the need.
The lien's Clothing Code vas adopted after public hearings before
Deputy Administrator Lindsay Rogers, and after numerous and prolonged
conferences oetueen two groups Tr el!-organized but divergent in interests.
The history of the pre-Code conferences and the issues drawn between the
"oroponents of two separate codes for the Industry is well set forth by
Deputy Rogers in his report on the Code. The following extracts from
this report should serve our immediate purposes, although the entire re-
port is bound, with the printed cop"' - of the approved Code:
"For this industry two codes were submitted. One was pre-
sented by the Clothing Manufacturers Association of the United
States of America, and one by the Industrial Recovery Asso-
ciation of Clothing Manufacturers. On July 19, 1933, the
codes were published s,s submitted to the Administrator. Pub-
lic hearings r 'ere held on July 26 and 27. rumerous confer-
ences then took place between the interested, parties and the
Administrator and on August 17, 1933, a code drastically
revised by the Clothing Manufacturers Association was re-
submitted to the Administrator and published.. This code is
now recommended for approval. The delay resulted from the
fact that there were material differences between the two
codes in respect of the wrotection above the minimum which was
to be afforded to semiskilled and skilled workers and in res-
pect of the administrative machinery to carry out the provi-
sions of the code.
"A fundamental! difference in the points of view of the two
Associations appeared in respect of Section VII (a). The
code submitted, by the Clothing Manufacturers Association did
no more than cuote the mandator;'- Drovisions of the National
Industrial Recovery Act. On the other hand, the Industrial
Recover:/ Association pro-oosed the addition to Section VII (a)
of the following language: 'Employees not members of a
9732
-142-
labor union shrll be free from interference, restraint, or
coercion by any labor onion, its members or agents. Em-
ployers and employees may bargain individually or collectively
as may be mutual ly satisfactory to them. 1 The fact that this
Code sought in effect to interpret and possible amend an Act
of Congress discloses the principal reason why two codes '"'ere
presented by the two associations in the lien's Clothing Indus-
try. One association--the Clothing Manufacturers Association —
is composed largely of union manufacturers. The Industrial
Recovery Association is composed of non-union manufacturers.
Immediately after the passage of the National industrial Re-
covery Act there had been negotiations between the two asso-
ciations looking to agreement on a single code but the nego-
tiations had failed and in the hearings the associations were
arrayed against each other.
"'There is no difference between the hinds of clothing made
by the manufacturers in the two associations. From testi-
mony at the hearings it would appear that the Clothing Manu-
facturers Association represents between sixty-five per cent
(65,o) and seventy-five per cent (75,5) of the industry. The
testimony, however, failed to disclose any valid ground on
which it might be concluded that the minority association
represented a subdivision of ^n industry within the meaning
of the National Industrial Recovery Act (Section 3 (a)).
"The real cleavage — which appeared clearly in the hearings —
resulted from the fact that the Amalgamated Clothing TTorkers
of America have collective agreements with the bulk of the
employers in the Clothing Manufacturers Association, while
the bulk of the employers in the Industrial Recovery Asso-
ciation are non-union. It seems clear, however, that be-
cause a. union has bean recognized by one group of employers
and has not been recognized ~o~j another group of employers
is no valid reason for dividing an industry into t v o parts.
There must be one code for the industry and one agency to
administer this code. The administrative agency must be
absolutely neutral in respect of the cleavage' referred, to
and must show a proper regard for the fact that adminis-
tration in the large centers — particularly in respect of the
manufacturer-contractor system — presents wroblems different
from the problems of administration in other sections of the
country where manufacturing is direct and where labor may be
less skilled. Neither of the two groups — between which, as
has been said, save for labor relations, only artificial
divergencies of interest exist — should be in a position to
dictate to the other group.
"After the conclusion of the hearings, there were a number
of conferences between representatives of the two associa-
tions. It appeared, however, that no matter how extended
the conferences became, it would not be possible for the
two associations to agree on a single code. The Industrial
9782
1 I T
— I. ... I
Recover^ Association • i 1 ", '& its >.ro >s i ' iti f i S c-
tion VII (a), but 0:1 wages above the minimum and on administra-
tive machinery its representatives were .adamant . Indeed, they
"ere compelled to be adamant because they die not have suffi-
cient authority from the membership of their Association freely
to negotiate. Under its b'--la: s, moreover, tae Industrial Re-
covery Association refused admission to manufacturers v, ho had
collective agreements with the Amal jai ;ed Clothing h'or!:ers of
America and this it was argued nas an 'ineoui table restric-
tion on admission to membership' within the meaning of the
national Industrial Recovery Act (Section 3 (;.)).
"In view of these circumstances, the wise course appeared to
be for the Clothing Manufacturers Association to revise its
code on the basis of the co. si derations adduced at the hear-
ings and at subseauent conferences with representatives of the
Industrial Recovery Association. Such a revised code would oe
resubmitted to the Administrator. Discussions with labor re-
presentatives on wages and hours would trite place and the
Industrial Recovery Association 1 s members "ould be invited to
give their approval to the ne ,v code as submitted and recommended.
This -orocedui-e was followed. "he revisions r~s<:\ drafting ''.'ere
greatly aided by representatives of important neutral factors
in the industr - ", that is, factors which die not belong to
either of the rroposii iciations. The revised code was
resubmitted and published on August 16, 1933, and is herewith
recomnend.ed for executive approval."
"ith resrject to the controversies over 3ro _ oosed codal provisions,
further attention is now called to certain outstanding differences
between the Industrial Recovery Association and the Clothing Manu-
facturers Association not elaborated apon in the extracts from Deuuty
Rogers' report, although certain of these issues will be discussed more
fully in sections of this Stud;/ '."here appropriate.
The Industrial Recovery Association agreed to withdraw its -orooosed
addition to the mandatory Section 7 (a) on the grounds th t such addi-
tion was 'merely interpretive 1 ajid therefore unnecessary.
Regarding the scale of wares above the minimum, the Industrial Re-
covery Association '-ould. not yield beyond its recommended provisions
that there be a minimum increase of 20 per cert in earnings of each
class of workers but to apply onJr r to employees earning I-30.00 a week or
less for full time employment prior to July 1, 193-'", and that no other
wage rates than the lowest minimum (to be determined by the Administra-
tor) be prescribed in the Code. The Clothing Manufacturers Association,
on the other hand, had insisted that the Code provide a minimum for one
of the advanced wage grouos (cutters. — at the race of 3(V- per hour), and
tha.t "the existing amounts by which wages in the highe] — priced, classes,
up to workers receiving 330 per wee 1 :, exceed ws -es in the lowest paid
classes, shall be maintained." This difference of opinion was irrecon-
cilable and v/as resolved only through Administrative action. This con-
troversy is emphasized inasmuch as the views expressed here erqolsin in
great measure the controversies which have developed respecting enforcement
9782
-14a-
of wage provisions of the Code.
In the matter of an agenc?r to administer the Code, the Industrial
Recovery Association insisted to the last upon eoual rights with the op-
posing Association, liven after the esta.bli shment of the Code, the In-
dustrial Recovery Association addressed a letter to its nembershi-o ad-
vising compliance with the Code but stating that such compliance is "not
to be construed as an admission that the Clothing Manufacturers Associa-
tion of the United States of America, the applicant for said Code, im-
poses no inequitable restriction on admission to membership therein or
is truly representative of the clothing industry of the United States..."
Further consideration will be given this controversy in connection with
Chanter IV — "Code Administration — Organization and Procedure."
The Clothing Manufacturers As-ociation had proposed the mandatory
use of labels with power of wi th.dra.wal given to the administrative
agency of the Code. This provision was protected by the Industrial Re-
covery Association as giving, unjustifiably, "the power of life and
death over any institution. "
A. Problems of the Industry Mot Covered 1 b~ r the Code .
1. Trade Practices
Both Codes originally proposed for the hen's Clothing Industry made
some provision for the setting up of fair trade practices, especially
with regard to sales terms and conditions, contracts, cancellations,
and returns. There is little evidence but that the opposing groups
could hsve agreed upon provisions covering these subjects; however, no
provisions were adopted and the reasons therefor are set forth in deta.il
in the discussion of fair trace practices. At the moment, it should be
recalled that proponents of the Code showed an inclination and willing-
ness to consult with industries which might be concerned before proposing
definite trade practices. The Clothing Industry as a whole was anxious
to get a code and there appeared no general insistence uoon the working
out of complete details relative thereto prior to formal adoption of a
code. This attitude is evidenced by the provision in Article XVI that
the National Association of Uniform Manufacturers "shall make recom-
mendations to the Administrator in respect of the trade practices desir-
able for this branch of the Industry."
2. Apprentices.
As will be pointed out in connection with the labor provisions of
the Code discussed, in Chapter V, there was evidenced within the Lien's
Clothing Industry a considerable demand J or apprenticeship provisions.
The Code as adopted, made no provisions for learners. The Industrial Re-
covery Association urged that a certain latitude in the wage provisions
be allowed in favor of beginners. This group rea.soned that outside of
the congested centers of population women are largely employed and that
during the depression years the supply of workers is depleted, b"" - marriage,
death, and other causes, and that "with a return of recovery a large
number of new recruits would be required," ( *) The opposing Trout) argued
(*) Statement of Industrial Recover 11- Association of Clothing Manufac-
turers, February 2, 1935, Page 10.
9782
•145-
that the large reservoir of unemployed in the urban centers be absorbed
bofore concessions he made for learners. The Administratis concurred
in the latter view. There yet remains, however, the criticism that such
a discrimination against the establishment of slants in rural areas.
3. Differences in Industrial Technique.
Doubtless the last-discussed problem, not solved by the Code, was
only one aspect of the larger problem of the Industry which was mani-
fested by the antagonistic views expressed by the two opposing groups
in this Industry. The minority grouo in the Industry continued to in-
sist most vigorously that fundamental technological and economic facts
divided the Industry into opposing camps to which the Code gave little
consideration. This minority group, when confronted with the possibility
of additional classified wage scales in the Code, -orotested bitterly on
the grounds that this would *»ork a hardship because of the nature of
production in the decentralised areas. I.t was explained that "by neces-
sity, due to lack of trained halp, the manufacturing operati~ns are
divided and subdivided so that an;' unskilled person is able to perform
after proper training, one minor operation; but such an employee had no
facility or skill in performing other operations. In short, an operator
in a centralized market, like Hew York, can handle with equal facility
almost any tailoring job in a clothing plant. On the other hand, an
operator in the decentralized markets is unemployable, except at his
own operation." (*)
Note:
The above assertion respecting differences between two types of
production in the Industry, if true, dov.btless should have been
given adequate consideration in the drafting of provisions res-
pecting the entire Industry. It should be noted that no evidence
as to this matter exists in the Administration's files aside from
bare assertions made by interested parties to the controversy.
(*) Extract from Brief presented on behalf of the Bloch Co. against pro-
posed amendments to the ken's Clothing Code, February 15, 1935. (Men's
Clothing Code Files.)
9782
-146-
CHAPTSR IV
CODE ADMINISTRATION— ORGANIZATION AND PROCEDURE (*)
1. MEHBERSHIP OP CODE AUTHORITY
The Men's Clothing Code provided as follows for the establishment
and organization of a Code Authority:
"A board known as The Men's Clothing Code Authority shall
be established, and for the purpose of effecting member-
ship therein representative of the entire industry, such • .
Board shall be constituted as follows:
"Ten (3 0) members representative of members of The Cloth»
ing Manufacturers Association of The United States of
America, and
"Five (5) members representative of employers in the
Clothing Industry who are not members of The Clothing
Manufacturers Association of the United States of America,
shall be appointed by this Association.
"Two (2) members representative of other employers may be
chosen by the foregoing members.
"Five (5) members representative of labor shall be appointed
by the Administrator on nomination by the Labor Advisory
Board.
"One (l) member may be appointed by the Administrator."
The above codal provisions were adopted after considerable con-
troversy between the Industrial Recovery Association and the Clothing
Manufacturers Association, and were largely the restilt of Administra-
tive determination. The code presented by the Industrial Recovery
Association recommended an Administrative and Advisory Agency, such
Agency to consist of five members to oe elected. by the Industrial
Recovery Association, and five members to be elected by the Clothing
Manufacturers Association, and one member to be appointed by the
National Industrial Recovery Administrator. The last-named member was
to have no vote except in case of tie and was to act as chairman of the
Agency. (**)
To carry out the provisions of the Code, the Clothing Manufacturers
(*) For a list o^ Division Administrators, Deputy Administrators,
Assistant Deputy Administrators, and Aides, who served in
connection with this Code, see Appendix B.
(**) Printed copy of codes recommended by Industrial Recovery Associa-
tion and Clothing Manufacturers Association (Men's Clothing
Code Files.)
9782
-147r
Association recommended the establishment of a Planning and Fair
Practice Agency, to consist of the Executive Committee of the 'Clothing
Manufacturers Association and that three members appointed ay the
Administrator should have no vote. (*)
With respect to the recommendations for establishment of a govern-
ing "body in the Hen's Clothing Industry, Deputy Administrator Lindsay
Rogers, in recommending the Code to the President, states:
"When the codes we^e submitted to the Administrator,
administration by a trade association was contemplated.
The device of administration by a Code Authority had not
yet evolved. The Code 'as recommended provides for a Code
Authority, but with proper representation for divergent
interests in the industry on a basis which "ill be discussed
later in this report, and which it is believed will quiet
the fears of the Industrial Recovery Association. » (**)
The basis of representation contemplated and understood by
Deouty Administrator Rogers, but not elaborated in the final codal
provisions, is set forth more definitely in the latter part of his
report to the President under the heading "Constitution of Code
Authority." It is explained thati
"Pive (5) memoers of the Code Authority are to be selected
by the Clothing Manufacturers Association to represent
manufacturers who are not members of that Association, i.e.,
the manufacturers "/ho pre members of the Industrial Recovery
Association. These five (5) representatives will, it is
believed, be more than the Industrial 5-ecovery Association
is entitled to under the basis of the number of workers its
members enroloy or the total annual value of production.
Designation of these representatives vy the Clothing Manu-
facturers Association will, it is anticipated., nut the
responsibility on that Association to give the fairest kind
of representation to the part of the industry which is not
within its membership."
The Question of representation on the Hen's Clothing Code Authority
was not settled to the satisfaction of either the Administration or the
industry. Although the codal provisions do not expressly require the
anointment of members of the Industrial Recovery Association to the
Code Authority, the members of the Code Authority representing the
Clothing Manufacturers Association nave repeatedly invited leading
members of the Industrial Recovery Association to assume memoership,
but only two accepted.
(*) Printed copy of codes recommended 'oy Industrial Recovery
Association and Clothing Manufacturers Association. (Men's
Clothing Code Piles.)
(**) Printed Code No. 15, Page 11.
9782
'-148-
Officials of the Hen's Clothing Code Authority, in explanation of
the lack of representation of the Industrial Recovery Association on
the Code Authority have called attention to the fact that Mr. Mark \J.
Cresao, President of the Clothing Manuf r cturers Association of the
United States, addressed a letter under date of August 18, 1933, to all
members of the Industrial Recovery Association requesting nominations
for membership on the Code Authority. Upon receiving few responses to
this invitation, it is asserted that Mr, Cresao "did the next best
thing" by selecting for personal invitation representatives from the
Industrial Recovery Association whom i-,s membership had chosen for
officials, with one exception.
The men representative of the Industrial Recovery Association who
were given personal invitation to sevve on the Code Authority were
S. H. Curlee, L. L. Grief, Sol Heuman, J. Schoeneman, and George Henry.
"Messrs. Heuman and Henry accepted f;he invitation, joined the Code
Authority. . ..The other three men, Messrs, Curlee, Greif, and Schoeneman,
refused the invitation." (*)
The Administration on the ot-ner hand, without questioning the con-
duct of the membership of the Cor\e Authority as originally constituted,
granted tentative recognition to that Code Autnority with the under-
standing of the need and intention of a future remodeling of the pro-
visions for membership and representation.
A * Formal Recogni t ion, and Sst-flblishuent of Code Authorit y.
In accordance with coda\ provisions, on November 27, 1933,
Administrator Hugh S. Johnson appointed B. H. Gitchell, formerly Deouty
Administrator in the Apparel Section of the N.R.A. , to the place of
Administration Member on tlie Code Authority. Mr. Gitchell served in
this capacity until March 11, 1935, at which time he -e signed, giving
the reason that the responsibilities as Chairman of the Dress Code
Authority made it difficult to devote time required of the Administra-
tion Member. (**) Even a year earlier on March 2, 1934, we find the
Code Authority submitting a resolution to the Administration expressing
satisfaction with the rtenresentative of the Administration, but point-
ing out that his burdensome duties and assignments had retarded "the
securing of -orompt anr'i decisive action from the National Recovery
Administration." (***/)
It is noted from minutes of the Code Authority's first meeting
Memorandum-*, n Organization, Character, and Method of Selection
of the Code Authority" (Men's Clothing Files)
(**) Letter datfed March 3, 1935, to M. D. Vincent, Deouty Administrator.
(Men's Clo thing Code Files.)
(***) Bound Copy of Resolutions, March 2, 1934, Directed to
Conference of Code Authorities. (Men's Clothing Code Files.)
9782
-149-
that Deputy Administrator 'Lindsay Rogers attended as Administration
Member*
1. Recognition of Labor Members.
Aside from the official appointment of the Administration Member
on November 27, 1933, no formal recognition was accorded any member of
the Code Authority until July 6, 1934, when ~ay Administrative Order five
representatives of labor who had been serving on the Code, Authority ,
apparently since its inception early in September, 1933, were given
approval. The omission of this act of formal recognition had been
called to the attention of the Deputy administering the Code by the
Labor Advisory Board. The labor representatives approved as members
of the Code Authority were as follows: (*)
Sidney Hillman, President, Amalgamated Clothing Workers
of America.
Hyman Blumberg, Amalgamated Clothing Workers of America,
"Jew York City.
Samuel Levine, Chicago Joint Board, Amalgamated Clothing
Workers of Am°rica.
Thomas A. Rickert, United Garment Workers of America,
Hew York City.
Abraham Gordon, United Garment Workers of America,
! T ew York City.
It is noted that Mr. Abraham Gordon, of the United Garment
Workers, succeeded, on approval of the Labor Advisory Boa.rd, Mr. J. L.
Wines, about June 15, 1934. Mr. Wines, a former executive of the
United Garment Workers, had served on the Code Authority from
September, 1933, until his death about June, 1934.
2. Recognition of Industry Members.
Despite formal approval of labor representrtives on the Men's
Clothing Code Authority on July 6, 1934, the recognition of Industry
members was not acted upon until October 19, 1934, through Administra-
tive Order No. 15-36. In recognizing fifteen industry members and in
approving their method of election it wa.s stipulated (not in Order
15-36) that a plan of reorganization be submitted to the Administration
within forty-five days. (**)
The Code Authority gave consideration to this request and on
November 3, 1934, by unanimous resolution asked that membership and
(*) Administrative Order No. 15-16, appointing Labor
Representatives to Code Authority, dated July 6, 1934.
(**) Letter dated November 15, 1934, from George L. Bell,
Executive Director, Men 1 s Clothing Code Authority, to
M. D. Vincent, Deputy Administrator. (Ken's Clothing
Code Piles.)
9782
-150-
raethod of selection "be extended until June 16, 1935. (*) The reason
given for this requested extension wa,s that the Act would probably be
revised and amended and that changes would likely have a bearing on the
question of membership of Code Authorities; hence, it was not felt
advisable to take a definite stand rarior to such revision. U'obn this
reouest of the Code Authority, S. H. Ourbacker, Assistant Deputy
Administrator, recommended to Prentiss L. Coonley, Acting Division
Administrator, that the membership of the Code Authority be extended to
June 16, 1935, at the same time making the following comments relative
thereto: (**)
"This particular Code Authority has performed its functions
admirably, and there have been no objections to the method
of their selection or any of the Code Authority members
brought to the attention of the Administration. The men
making up this Code Authority are all representative of the
industry, coming from various important markets."
In turn, Mr. Coonley in memorandum of November 5, 1934, advised
Blackwell Smith, Chief Counsel of H.R.A. , that: (***)
"The Men's Clothing Code Authority has been functioning as
a de facto Code Authority for many months. There has not
been a single nrotest from any Industry Member regarding the
personnel of the Code Authority Membership as constituted,
and, from an administrative point of view, the present
constituted Code Authority has functioned smoothly and well."
"I believe that as a practical matter the Code Authority
should be recognized as such, pending election of a new Code
Authority in accordance with plans now being formulated and
before the Administration. Failure to grant this recognition
can only result in decreased confidence in the Code Authority
and would necessarily be reflected in added difficulties in
Compliance. "
In compliance with the Code Authority's rectuest and in line with
the above-quoted recommendation, Administrative 'Order No. 15-44 was
promulgated, recognizing the following-named persons, i'n addition to
labor representatives and the Administration Member already approved,
as constituting the Men's Clothing Code Authority up to June 16, 1935:
(*) Letter dated November 16, 1934, from George L. Bell,
Executive Director, Men's Clothing Code Authority, to
M. D. Vincent, Deputy Administrator. (Hen's Clothing Code
Files.)
(**) Memorandum dated December 12, 1934. (Men's Clothing Code Files.)
(***) Memorandum dated November 5, 1934. (Men's Clothing Code Files
under Code Authority Members.)
9782
Name I
Karl: U. C re sap
Chas. D. Jaffee
Maurice Gordon
Benjamin J. Lsbow
Bertram J. Cahn
Max L. Holtz
Raymond H. Reiss
Victor S. Riesenfeld
Sol Heumann
Frank C. Lewman
George Henry
Elmer L. Ward
Louis A. Hirsch
Rudolf Greef
Louis Sus sman
1 -151-
Af filiation
"art, Schaffner & "■ -
Jaffee, Cohen & Lang, Inc.
Trimount Clothing Co. , Inc.
Lebow Bros.
3. Kiippenheiraer Co., Inc.
Louis Holtz & Sons, Inc.
International Tailoring Co.
Cohen, G-olcjnan & Co c
Kelle"r s Heumahn, Thompson Co,
Ri-chman Brothers
II. A. Seinsheimer « Co.
Goodall Co„
Hirsch, ffeintraub & Co.
Greater Clothing Contrac-
tors Association, Inc.
The tiid&ishade Co.
Address
Chicago, 111,
New York, N. Y.
Boston, Mass
Baltimore, Md,
Chicago, 111.
Rochester, H. Y.
lieu York, II, Y.
New York, II. Y.
Rochester, II. Y.
Cleveland, Ohio.
Cincinnati, Ohio.
Knoxville, Tenn.
Philadelphia, Pa.
New York, N. Y.
Philadelphia, Pa.
On January 2, 1935, George L. Bell, Executive Director of the Men's
Clothing Code Authority, advised the Administration that Prank P. Zurn,
of the Alco zander Co., Philadelphia, Pa. . was designated successor, to
Mr. Sussman "by the Chairman of the Code Authority on March 2, 1934. It
was explained that Mr. Sussman had resigned and that Mr. Zurn was
appointed in his place as a representative of the Clothing Manufacturers
Association. This belated notice of appointment was duly acknowledged
by the Administration and approved December 28, 1934, by Administrative
Order Ho. 15-46. The acknowledgment of the appointment explains that
the Code Authority's request to change the records to make the appoint-
ment stand as of March 2, 1934, could not be met "as the order approving
this succession could not be made retroactive." (*)
In connection with Code Authority membership, it should be pointed
out that the Code provision, "Two members representative of other
employers may be chosen by the foregoing members — " was never put into
effect. TThile the matter would appear to have' been optional with the
Code Authority, judging from the terminology of the provision, the Code
Authority was asked by the Administration to take the question of
electing two additional members under consideration. Administration
Member B. H. Gitchell on June 14, 1934, advised Deputy Administrator
M. D. Vincent that the cuestion "as considered "but it is being held
in abeyance. .... If boys' wash suits should be transferred from the
Cotton Garment Code to the Men's Clothing Code, it would mean that
additional representation would be required on the code. Just as soon
as this matter is settled the representation on the Code Authority will
be finally completed." (**)
(*) Letter dated January 7, 1935, from S. H. Ourbacker, Assistant
Deputy Administrator, to George L. Bell, Exec. Dir. , Men's. Cloth-
ing Code Authority. (Men's Clothing Code Piles.)
(**) Letter dated June 14, 1934, from 3. H. Gitchell to Deputy Administra-
tor M. D. Vincent. (Men's Clothing Code files.)
9782
4 -152-
Approximately a year later, on May 14, 1935, the Executive
Director of the Code Authority advised the Administration that action
had been taken with respect to giving recognition on the Code Authority
to single pants manufacturers. The Executive Director quotes from a
decision of the Code Authority Executive Committee as follows: (*)
"¥e are quoting 'below that portion of the summary of the
minutes of that meeting having to do with the decisions of
the Executive Committee on which we seek Administrative approval:
"'The request of the National Boys' Pants Manufacturers
,. Association, Inc., as transmitted hy Mr. J. E. Brill, that
this Association he granted representation on the Code
Authority, was discussed. It was unanimously decided that
the Executive Committee recommend to the Code Authority at
its next meeting that an invitation be extended to Mr. I.
Wolrich, President of the National Boys' Pants Manufacturers
Association, Inc. , to become a member of the Code Authority
in his capacity as President of this Association, representing
the single pants group.'"
There is no record of Administrative action upon the part of
N.R.A. officials with respect to this contemplated addition to the
membership of the Code Authority.
The question of tenure of membership on the Code Authority was the
matter of some misunderstanding between the Code Authority and the
Administration until temporarily settled by the Administrative Order
granting extension of membership until June 16, 1935. On September 13,
1934, prior to approval of industry members, Deputy Administrator
Dean G-. Edwards wrote George L. Bell, Executive Director of the Code
Authority, calling attention to the fact that terms of office had
expired for ten members appointed by the Clothing Manufacturers
Association September 6, 1933, to serve one year, and that a new election
was in order. Deputy Administrator Edwards also advised that five other
members had been appointed, two on September 6, 1933, two on November
8, 1933, and one on December 8, 1933, but for whom no terms of office
were mentioned. It was requested that a new selection of all fifteen
members be arranged "specifying the terms of office (not exceeding one
year) and in accordance with Code provisions and the policy of the
Administration that Code Authority members shall be truly representative
of the industry." (**)
(*) Letter dated May 14, 1935 from Morris Greenberg, Executive
Director, Men's Clothing Code Authority, to Walter E. Woodford, Jr.,.
Assistant Deputy Administrator. (Men's Clothing Code Files, under
Budgets and Assessments.)
(**) Letter dated September 13, 1934, from Deputy Administrator
Dean G. Edwards, to George L. Bell, Executive Director of the
Men's Clothing Code Authority. (Men's Clothing Code Files.)
9732
-153-
In response to Deputy Administrator Edwards' request for a new
election of industry members of the Code Authority, Dpvid Drechsler,
Secretary of the Code Authority, on September 27, 1934, re quested with-
drawal of the certification of the list of members in which it was
stated that the ten members were elected for a term of one year. (*)
He explained that the Code placed no limitation on the terra of office
and that the suggestion of one year came uc for discussion in
connection with the writing of by-laws. That a one-year term of member-
ship on the Code Authority had been definitely considered at one time
is clear from a letter from Mr. Drechsler to the 1T.R.A. on April 3 S 1934,
in which he states:
"By-laws are now being written, in which the term of office
of" each member of the Code Authority will be definitely fixed.
Such term not to exceed one year from date of appointment." (**)
3« Propos e Consumer Hopr:.nano. t lo n on C^do ^uthoi'it" .-
Although no codal provision relates thereto, the Men's Clothing
Code Authority gave consideration to the recognition of a "consumer
advisory member" of the Code Authority. The minutes of the March .2 and
3, 1934, meeting of the Code Authority report that an official of the
Code Authority conferred with Mr. W. Jett Lauck of Washington,
"recently designated as the Consumer Advisory Member of the Code
Authority.". The Question of compensation arose and the matter was
referred to the Code Authority. Members of the Code Authority expressed
doubt as to the wisdom of paying a' Consumer Adviser from funds collected
fr.om the Industry. The services of Consumer Adviser were compared
with those of a government official and it was agreed that the Govern-
ment likely would refuse permission to pay a Consumer Adviser from
Code Authority funds. "The matter was left open for further considera-
tion," but the records do not disclose further action.,
Certain Code Authority officials had previously expressed a keen
interest in the possibility of consumer representation on the Code
Authority. The following, extract from a letter of the Chairman of the
Code Authority is of particular significance in that it shows a willing-
ness to admit the reasonableness of a consumer voice in the matter of
contemplated price advances. The opinion of the Code Authority Chair-
man is indicated by the' following quotation:
"My attitude on consumer member of Code Authority is that
we cannot submit amendment to Code without meeting of Code
(*) Letter dated September 27, 1934, from David Drechsler, Secretary,
Men's Clothing Code Authority, to Deputy Administrator
Dean G. Edwards. (l«en'*s Clothing Code Files.)
(**) Letter dated April 3, 1934, from David Drechsler to II.R.A.
(Men's Clothing Code Files under Code Authority Members.)
9782
-154-
Authority nor do I think it is province of chairman to
name member, ",/hat I did have in mind was that sending
later action "by Code Authority we could suggest to
General Johnson that consumer representative be designated
to sit with us in Advisory capacity and later "become
member of Code Authority and this action taken quickly
would show readiness of clothing industry to cooperate
immediately on subject of price advances. I think it
would "be perfectly proper for us to suggest to General
Johnson name of some conspicuous person truly representa-
tive of consumer interests "but feel it would "be mistake
to suggest anyone engaged in manufacture or distribution
of clothing as. was done at time of our hearing.***" (*)
The office of Code Records reveals that "by Administrative Order
No. 15-39, dated December 6, 1934, Alexander Thomson was assigned to
duty with the Men's Clothing Code Authority in the capacity of
Special Representative of the Deputy. The files do not indicate the
nature of the. duties performedo
B. Code Authority Offi c ials, and General Organization '•■
The principal executive offices of the Code Authority were those
of Executive Director, Secretary and General Counsel, and Comptroller.
The Executive Director was charged with the general supervision
of all activities of the Code Authority. He was responsible for
contact with Washington on all affairs affecting the administration of
the Code. This office was held until February, 1935, by George L. Bell.
The announcement of Mr, Bell's selection for the position of
Executive Director and the listing of his qualifications is found in
the statement of Mr. David Drechsler "before the Code Authority,
December 8, 1933: (**)
"***The man chosen is George L. Bell. I found him
acceptable to every one with whom I talked and I have
talked to practically all of the members of the Code
Authority. Mr. Bell is now with the Caterpillar Tractor Co.
of Peoria. His background is all that could 'be asked for.
He graduated from Harvard La.w School in 1912. He practiced
law in San Francisco for a few 'years. He became a member
of the Housing and Immigration Committee in California, and
(*) Letter dated December 20, 1933, from Mark 7. Cresap, Chairman
of Men's Clothing Code Authority, to David Drechsler,
Secretary of Men's Clothing Code Authority. (Men's Clothing
Code Piles, under Code Authority Members.)
(**) Minutes of Fourth Meeting of the Men's Clothing Code
Authority. (Men's Clothing Code Piles, under Code Authority
Meetings. )
9782
was counsel to that Committee. He was Secretary to the
Nat ion§. Labor Policies 3c ird Ln U shington during the
war. He tnen came on to Nevs York end oted as Impartial
Chairman for the clothing industry, for something like
two years. After that he went bs 3k to the Industrial Rela-
tions work. He has been with the Cater filler Tractor
Co. and acted as Vice President and Director for the last
six or seven years.***"
Upon the resignation of Mr. Bell, the Code Authority elected as
his successor Morris G-reenberg, who has been recognized for several
years as a technical expert in the Clothing Industry and who has been
serving as Deputy Administrator in the Textile Division of the N.R.A.
The Secretary and General Counsel of the Code Authority was
charged with the keeping of proper records and minutes of Code
Authority meetings and was general legal adviser to the Code Authority,
handling all cases before the Compliance Council.. This office was
held from the inception of the Code Authority by David Drechsler, a
lawyer of twenty-five years' experience in New fork City, experienced
in legal problems of clothing manufacturing, having been counsel for
the New York Clothier's Exchange — an association of clothing manufac-
turers. Mr. Drechsler was at one time a member of the New York State
legislature.
The Comptroller of the Code Authority was responsible for the
control of finances with respect to both receipts and expenditures.
Also, he was charged with the computation and analysis of statistical
reports required of industry members; was responsible for investigators,
and assisted the Executive Director in interviewing persons accused of
code violations. This position was occupied from the establishment of
the Code Authority by H. K. Herwitz, who had twenty years' experience
in financial and statistical affairs; formerly connected with the Muni-
cipal Research Bureau of Chicago; Vice-President in charge of statistics
and financial research for the Amalgamated Bank in New York, and en-
gaged in research for a New York brokerage house for five years.
The Code Authority, for the execution of its functions, was to a
certain extent departmentalized, although the matter of policy and
course of procedure was determined for tne most part by standing and
special committees usually appointed ~oy the Chairman of the Code
Authority. The principal departments of the Code Authority were the
Label Divisions, the Compliance Division, and the Statistical Division.
The chief committees were as follows:
Executive Committee
Committee on Amendments and Interpretations
Tne II (d) Committee
Compliance and Enforcement Committee
Finance Committee
Labor Committee
Committee on publicity
Committee on P.elations between Manufacturers and Contractors
Committee on Fair Trade Practices
9782
-156-
II. COMPLIANCE PROCEDURE
The actual handling of certain compliance cases, the methods
employed and criticisms arising therefrom will be discussed some-
what in detail in the chapter "Labor Under the Code." The present
purpose is to describe in brief the machinery of compliance and the
authorization by which the Code Authority took action on compliance
cases in the first instance.
Officially the Men's Clothing Code Authority was given authori-
zation to handle "all complaints in the first instance" by memo-
randum of January 22, 1C34, to Division Administrator A. D. White-
side, in which Wilson Compton, Chairman of the Code Authority Or-
ganization Committee, with the approval of W. H. David, national
Compliance Director, states:*
"The Code Authority Organization Committee, after consultation
with the National Compliance Director, recommends that the Men's
Clothing- Industry Code Authority be given temporary qualification to
administer its Code including both Fair Trade Practice and Labor
complaints in the first instance.
"Since the District Comoliance Director has already
been notified by Field Letter Ho. 28 that this Code
Authority has been authorized to handle all complaints
in the first instance, this approval is given 'nunc pro
tunc. "'
A memorandum was forwarded to W. K. Davis, National Compli-
ance Director, by A« J. Altme5rer, Chief, Labor Branch of Compli-
ance, on January 11, 1934, stating that the Code Authority was
qualified to handle labor complaints in the dirst instance and
that formal authorization should be recommended. This communica-
tion, however, concluded:* v
"As a matter of fact I am advised that notice has already been
sent to the District Compliance Directors that this Code Authority
is authorized to handle all complaints in the first instance. There-
fore, formal authorization is only for the purpose of completing the
record. "
(*) Memorandum dated January 22, 1934. (ken's Clothing Code Files,
uno.er Code Authority Committees. )
(**) Memorandum dated January 11, 1S34. (Men's Clothing Code piles,
under Code Authority Committees.)
9782
-157-
It is true that District Compliance Directors had been au-
thorized by Field Letter No. 28, December 22, 1933, from the
National Compliance Director, to "refer all complaints without
time limit notice to the Lien's Clothing Code Authority" for the
reason that Deputy Administrator B. H. Gitchell (Administration
Member) "had instructed us that the Men's Clothing Code Author-
ity is authorised to handle all complaints of violations of the
Ivien's Clothing Code in the first instance."
Deputy Administrator B. H. Gitchell, by letter of Decem-
ber 19, 1933, had advised the National Compliance Director that:
"***the Men's Clothing Code Authority is organized
with proper labor representation and is functioning
in such a manner that it would be appropriate to have
all complaints referred to it without limit. "*
Deputy Administrator Gitchell 's letter, above quoted, was
in response to a suggestion from David D'rechsler, Secretary of
the Code Authority, that a recommendation from Mr. Gitchell was
awaited in order that the Code Authority obtain permission to
handle its labor problems.*
On February 12, 1934, Deputy Administrator Earl Dean Howard
directed a memorandum to the head of the Code Authority Organiza-
tion Committee, stating that the Code Authority had ample funds
to carry on their work thoroughly, that qualifications of labor
representation had been met, that the Administration was represented
on the Code Authority, and recommending that authorization to deal
with non-compliance cases be given the Code Authority.
In the meantime, while this belated activity with respect to
formal authorization of the Code Authority to be handle complaints
was being indulged in, the Code Authority had already ji-oceeded
to set up compliance machinery and was engaged in the actual hand-
ling of complaints, apparently with the knowledge and approval of
Administration officials.
(*) Letter dated December 19, 1933, from B. H- Gitchell, Deputy-
Administrator, to ".",'. H. Davis, National Compliance Director.
(Men's Clothing Code Files, under Code Authority Committees.)
(**) Letter dated December 9, 1933, from Dcvid Drechsler, Secretary
of the Code Authority, to 1 Deputy Administrator B. H. Gitchell.
(Men's Clothing Code Files, under Code Authority Committees.)
9732
-158-
In the December 8, 1933, report of B. J. Cahn, Chairman of the
Code Authority Compliance and Enforcement Committee, we find a
statement of the Committee's understanding of its authority and
obligations and the events leading up to the Administration's
first official recognition of the Code Authority's compliance
activity. The report of the Compliance and Enforcement Committee
in part reads:
"General Johnson gives to his Deputy the power to pass
upon the ability of self determination of the part of a s
Code Authority, where such Code Authority is fully
equipped to secure compliance with labor- provisions of
code and where such Code Authority provides for adequate
labor representation. All complaints will then be
adjusted within the industry and only such complaints
as the Industry is unable to adjust, the Code Authority
will refer for action to the Compliance Division of the
N.H.A.
"On Friday, December 1st, Mr. Robert Strauss of the Dis-
trict Compliance Division, (not being familiar with the
work of our Code Authority) in a telephone conversation
with Mr. Drechsler asked tnat we send to the Compliance
Division at the Custom House in New Yoric all com-
plaints filed with us. Mr. Strauss was thereupon in-
vited to visit our offices. On the following day Mr.
Strauss called and conferred with Mr. Drechsler
and Mr. Herwitz. A comprehensive statement was made of
the organization of the Code .Authority, its compliance
and enforcement committee and the manner in which investi-
gations, reports, and adjustments were made by it. At
the close of the conference Mr. Strauss requested a /
written report upon which he could base his conclusion.
Such report was made and filed with him on December 5th.
(Copy annexed.) This report was submitted by Mr. Drechsler
in person. I am informed that Mr. Strauss expressed
complete satisfaction with the manner in which the com-
pliance committee of the Code Authority handled its labor
problems and was quite impressed with its entire set-up.
It was his opinion that with the approval of the Deputy
Administrator the Code Authortiy should continue as hereto-
for."
Procedure of the Men's Clothing Code Authority in the handling
of complaints did not seem to be a matter for Administrative review
again until around the middle of May, 1934, when in reply to a request
from Assistant Deputy Administrator John R. Beecroft, the Comptroller
of the Code Authority, H. K. Herwitz, advises as to the method used in
handling labor complaints in detail, as follows;*
(*) Letter dated May 11, 1934, from H. K. Herv/itz, Men's Clothing Code
Authority, to John R. Beecroft, Assistant Deputy Administrator.
(Men's Clothing Code Files, under Code Authority Committees.)
9782
— 1 p n —
"As yon. are doubtless aware, the Lien's Clothing Code
Authority makes investigation on complaint and on its
oun initiative. We have at the present time approx-
imately thirty investigators in the field, covering
the important sections of the countr \
"The reports of the investigators with respect to a
specific establishment are not confinod to the specific
complaint hut cover all questions of observance or non-
observance of the standards of operation sections of
our Code. These reports, when 'received, are analyzed
hy our report division and all computations as to de-
ficiencies or underpayments are made in the office hy
the accounting section of this division,
"On the basis of the analysis of reports a statement
is given to the firm, which is in violation of the Code,
specifying in the fullest detail the nature of the offense,
the amount of underpayment, if any, the period covered
£ id other pertinent information. Opportunity is then af-
forded to the firm charged with the violation to either
maize written reply or to come in for a hearing at the
offices of the Code Authority in ±Tew York. In some cases,
we have arranged to have either I.ir, Bell, our Executive
Director, Mr. Drechsler, our Counsel, or myself, hold
hearings in other centers. Recently I.ir. Drechsler held
hearings in Baltimore and in Cincinnati.
"Failure to make adjustment either by letter or at personal
conference, or at hearing, the firm is notified that if no
settlement is reached, the case will then be certified to
the national Compliance Board.
"I am happy to state that relatively few cases have had
to be referred to the National Compliance Board. We have
been able to adjust by payment of the amount due or in
some other satisfactory way, cases involving violation of
standards of operation either after notification by mail
or through our adjustment machinery, and we have relatively
few cases referred to ~a:'hinyton on appeal.
"The hen's Clothing Code Authority has never had regional
industrial agencies. All matters have been handled through
the office at New York. We have no branch offices. We
have investigators in all important section, s but they are
from time to time transferred from one territory to another.
We do not permit investigators to make adjustment, interpre-
tations, or decisions in the field.
9782
-160-
"Ue have not adopted the method of regional agencies
hecau.se we feel that all decisions should he made by
a single agency so that the interpretation may he
iniform in all parts of the country. "
Assistant Deputy Administrator Beecroft appears to have been some-
what skeptical of the compliance procedure of the Code Authority, "because
a month subsequent to receiving the outline of methods employed, a memoran-
dum relating thereto is addressed to the N.R.A. Legal Division, requesting
an opinion at the same time saying:*
"So far as I know, while official authorization has
been granted the Code Authority to handle labor com-
plaints in the first instance, I do not believe any
method of procedure has been formally approved. This
authorization was granted in Dr. Rogers' time, and is
probably highly irregular according to our present re-
quirements. "
Whether or not the procedure in question was irregular, there is no
record in Administration files that any further action was taken at this
time.
(a) Industrial Adjustment Agency Contemplated.
It is a matter of interest that the Men's Clothing Code Authority,
apparently at the suggestion of the Deputy Administrator in charge of the
Code, gave some consideration to the possibility of compliance machinery
of an "impartial" character. Evidence of this is found in a letter from
the Executive Director of the Code Authority, which reads as follows:**
(*) liemorandum dated June 9, 1934, from John R. 'Beecroft,
Assistant Deputy Administrator, to Hilton Levy, Legal
Division. (lien's Clothing Code Files, under Code
Authority Committees, Trade Practice Complaints.)
(**) Letter dated June 5, 1954, from George L. Bell,
Executive Director, Men's Clothing Code Authority,
to John R. Beecroft, Assistant Deputy Administrator.
(Men's Clothing Code Piles, under Code Authority
Committees, Trade Practice Complaints.)
9782
-161-
"We have been giving further consideration to yours
of May 7 and 14 regarding the creation of an Indus-
trial Adjustment Agency with an Imperial Chairman
to hear later complaints and disputes.
"After discussing this matter thoroughly with our
counsel, ue telieve that no such action is necessary.
I think you and I have "both overlooked the fact that
we proceeded under Bulletin #7, Part 3, Section III,
and that we were granted the authority to receive and
act on complaints in the first instance. Before we
were granted this authority, we had made a formal re
port to the Administration, as provided in that manual,
setting forth the methods and required data. It seems
evident, therefore, that the Administration approved
of our general set-up and procedure, or we would not
have teen granted the right to handle complaints in
the first instance, "
III. USE 0? LABELS
Hie L'en's Clothing Code Authority from the beginning emphasized
the importance of the latel a.s a device for raising funds and gaining
compliance with code provisions. The former function of the latel
will te discussed later in this chapter, in connection with the general
financing of the Code Authority under the heading of "the Code Authority
Budget." The procedure relative to the issuing and use of labels in
connection with compliance functions is the matter of immediate
consideration.
The procedure in issuance of labels, and requirements respect-
ing their use, was fully outlined in the September 25, 1934, letter
from H. K. Herwitz, Comptroller of the Code Authoritj r , to Deputy
Administrator M. D. Vincent. Following is a summary of such regula-
tions:
9732
1- - Labels are issued to all manufacturers upon
filing of signed application and statement of
compliance. Additional iafor nation relating to
character of shop as — inside chop or contract
shop or both.— Is required Require siunature
on order card indicating persons who are author-
ized to order. Labels for r.-tocc on hand issued
at the time ij.bei system \ a.s out in.Vj effect about
October 10, 1933. ivlanufao triers required to maize
a sworn statement of number of finished garments
on hafid, Labels are issued only to manufacturers*
Manufacturers who employ aontrap.tcr3 are required to
furnish the labels to said contractors.
2 - Labels issued cover a four peeks' production •
period. No credit is eKtehded ana no accounts re-
ceivable allowed.
3 - LabiS required on each iidi v id ial' garment , that is,
on a three-piece suit, on the coat, vest, and pants.
4 - Code Authority, on Eecembcr 3, 1933, ruled that
labels must be attached when suits are in the process
of manufacture.
5 - Code Authority does not withhold labels un-
less the iJat/onal Compliance >nuicil or Administrator
has ordered the Code Authority to- do so.
6 - Code Authority does not authorize and give
publicity to withdrawal of labels "unless ordered- by
National Compliance Council of N.B..A.
7 - Money collected from sale of labels deposited in
bank designated by Code Authority and subject to
withdrawal by persona designated by Code Autnority.
All accounts of Code Authority are subject to inde-
pendent audit and all employees of Code Authority
covered by blanket surety bond.
To the above-outlined label regulrtions should be added
that in January, 1934, the Code Authority ruled that a manufac-
turer failing to use labels should pay to the Code Authority
one-half cent for the label he should have used, and one-half
cent for what would have been the cost of attaching the label.*
(*) March, 1934, .Report of Committee on Compliance and Enforce-
ment of Code Authority. (Lien's Clothing Code Files.)
9782
-J.DO"
The above regulations, agreed upon and ilaeed into effect by the
Code Authority, appear to be entirely in heriaonv with codal provision?.
relating to labels which are found in Section V of the Code, as follows:
"All garments manufactured or distributed shall be,;r an
U.S.. A. label, which shall remain attached to such garments.
Such labels shall beer a registration number specially
assigned to each manufacturer in the industry. The privi-
lege of using such labels shell be granted and such labels
shall be issued to any manufacturer from time to time en-
gaged in the Clothing Industry upon application therefor
to the Code Authority, accompanied by a statement of
compliance with the standards of operation prescribed by
this code. The privilege of using each labels and the
issuance thereof may be withdrawn and cease or may be sus-
pended in respect of an/- such manufacturer whose operations,
after appropriate hearing by The hen's Clothing Code
Authority and review by the Administrator, snail be found to
be in substantial violation of such standards. Manufacturers
shall be entitled to obtain and use such labels if they comply
with the provisions of this code.
"The Men's Clothing Code Authority may establish
appropriate machinery for the issuance of such labels
in accordance with the foregoing provisions."
From the foregoing provisions it could appear that the Code
Authority did not exercise the full measure of its authority in the
important matter of suspending the right of use of labels to violators
of codal provisions. The Code Authority awaited decisions of the
Compliance Council before taking action in this matter in which it is
rather clear that authority existed for direct action, although subject
to review.
While the Code Authority's label regulations appear well within
the bounds of codal provisions relating thereto, it is not clear that
they comply in every particular with Administrative Orders X-38 and
£-135, issued May 28, 1334, and February 25, 1935, respectively, which
set forth general label procedure and regulations. There is no
evidence that label regulations were submitted for the approval of the
Administration
9752
-164-
in the time specified prior to promulgation \ s required "by Order
X-38. Likewise, the charge for labels, as. in case of the penalty-
charge mentioned above , was not approved "by the Administration, and
^as in violation of both Grdar-s X-38 and X-135.
Administrative order X-135, promulgated on February 25, 1935,
required the drawing up of label regulations in accord with rules
set forth therein. The Men's Clothing Coue Authority revised their
label regulations and submitted them for Administrative approval
under date of April 2, 1935. For the mostpart the old regulations
were restated. The extent to which they fell short of official ex-
pectations can be best set forth by listing certain criticisms made
by the Label Review Officer of N.R.A. The criticisms, as follow,
are significant in that they make suggestions for more adequate
label control in the Men's Clothing Industry, based upon experience
derived from similarly situated industries. (*)
"There is no provision within these Regulations for
the suspension or removal of labels, and no refer-
ence to Administrative Order X-135. Inasmuch as
this Code has never used the machinery provided for
the suspension of issuance of labels, but has al-
ways resorted to final action by the Compliance
Council in the first instance, any reference to
suspension of issuance of labels is probably
unnecessary.
"Paragraph VI T I of the Regulations states that the
Code Authority delegates the oower to hold hear-
ings, concerning any of the provisions of the Code,
to the Executive Director. Is this the proper in-
str ment for inci uding such a provision for dele-
gation of power '
"Paragraph IX and the following paragraphs state that
a contractor shall not be entitled to purchase or
receive labels from the Code Authority, and that
all such labels shall be furnished for him and sup-
plied to him by the manufacturer upon whose work
such contractor is engaged. I consider this an un-
fortunate provision unless definite routine is pre-
scribed and power delegated for the removal of the
labels by the manufacturer from the contractor, on
orders by the Code Authority, and the further stipu-
lation that the manufacturer shall not receive any
unlabeled goods from a contractor whose labels have
(*) Letter dated May 3, 1935, from Dean G. Edwards,
Label Review Officer of N.R.A. , to M. D. Vincent,
Division Administrator. (Men's Clothing Code Files,
under Insignia and Label Regulations.)
9782
-165-
beon suspended or withdrawn bv direction of the 'Code
Authority, it seems to rae that the la c ;t sentence
of Paragraph IX does not sufficiently control the
situation. In my opinion a "better control of the
label situation, from the point of the Code Author-
its, exists under the arrangement now in effect by
the Coat and Suit. Code Authority and the Cotton Gar-
ment. Code Authority. In these cases the contractor
receives the labels direct from the Code Authority
on ord^r countersigned "by the jobber, or some simi-
lar procedure. In this manner the removal of labels
is direct and co^cl isive and the jobber is under ob- ■
ligation to receive no unlabeled goods from his
contractor. "
The Code Authority's practice of making an extra charge for
labels which wore left off suits by manuf act jrers, ' celled to the at-
tention of the Administration by Administration Member B. H. G-itchell,
although having previously apoeared in Code Author itv records as above
indicated; wrs r.ade the subject of inauiry and explanation was re-
quested of the Code Authority. (*) The Code Authority does not
appear to have officially reported on this matter bat it should be
mentioned, that no protests were made to the Administration concern-
ins the penalty charge, and the Code Authority Committee on Compliance
and Enforcement in its Inarch, -.193-1, report states that "the ruling'
of the Code Authority has not been contested by any violator." -
A. Label Publicity .
The larch 2, 1934, report of the Publicity Committee- of the
Code Authority states that the Committee had definitely decided against
the furtn.r expenditure of money for oaid advertising of the label in
anv media whatsoever. It was agreed that trade publication or news-
paper advertising was futile unless followed up over a long period of
time and unless sums larger than the Code Authority's total income
were expended. The Committee - thereupon devoted its efforts to the
securing of publicity by means .other than pa.id advertising. The Com-
mittee called the Code Authority's attention to the National Garment
Label Association campaign headed by Mrs. Franklin D.Roosevelt, which
had as a plan the idea of enlightening -men and women, especially
women, on the meaning of labels and the necessity for customers re-
quiring' them on garments. The Committee, indicated its willingness to
participate in a campaign of +his sort and suggested that a fair share
of cost to the Code Authority might be around $10,000. Action on this
plan was deferred but continued interest in cooperative action of the
general type ■ suggested was maintained by the Code Authority.
Letter dated March 5, 1935, from Assistant
Depaty Administrator Walter E. Woodford, Jr. ,
to ...orris Grec-nberg, Executive Director, Men 1,
Clothing Code Authority. (Men's Clothing-
Code Piles. )
9782
-166-
In the June 8, 1934, report of the Publicity Committee of the
Code Authority we find a protest against the stand of certain N.R.A.
officials who are opposed to the use of Code Authority funds for
labelspublicitv and who have doubts as to the propriety or legality
of using such funds in publicising labels. It was agreed that the
Men's Clothing Code Autnority should join with other' code authorities
protesting this limitation. It is brought out in this Committee reoort
that Administration officials advised that code authorities would
have to cooperate in a proposal for the use of funds in this con-
nection, with a budget subject to Administrative aporoval. The Com-
mittee oro'oos'ed that the ken's Clothing Code Authority follow the
lead of other large label code authorities in allocating two per cent
of total jroposed budget exoenditures to a joint label publicity
movement.
Out of the above-indicated experience of the fen's Clothing Code
Authority and that of similar label-using code authorities, there
was evolved a olan for an Apoarel Codes Label Council. This Council,
subject to Administrative control, was to be made up of representa-
tives of code authorities subject to codes having mandatory label
provisions. Joint action was to consist in the establishment of a
central bureau of shoppers, and the education of customers in the
meaning of the label. The aim was to secure publicity for the label
activities of participating code authorities, "though without using
paid advertising." This proposed Apparel Codes Label Council had not
as yet received official approval when the Executive Director of the
Men's Clothing Code Authority, on January 18, 1935, wrote Assistant
Deputy Administrator S. H. Ourbacker that since such a plan had the
endorsement of the Administration the Code Authority reauests aporoval
of budget expenditures under that heading, pointing out that the
Council was organized November 1, 1934, and that the Code Authority
had 3aid $600.00 per month for the months of November and December and
had set up in the proposed budget for the first six months of 1935, the
sum of $600.00 per month for the same ouroose,
B. Label Compliance .
The March 2, 1934, report of the Committee on Compliance and
Enforcement of the Men's Clothing Code Authority' states: "about the
middle of Januarv (1934)' it. became apparent from the original survey
that a considerable number of manufacturers and contractors were fail-
ing to use the labels from the Code Authority. In order to correct this
situation, practically the entire staff of investigators were concen-
trated on a check-up of labels. The result's have been very gratifying."
The Committee goes on to explain that at this time was instituted the
rale providing an additional cost for attaching labels which had been
left off suits. The September 14, 1934, report of the Executive Direc-
tor of the Code Authority states that "the number of reports of fail-
ure to use labels had rapidly decreased until today we have only rare
instances where investigators discover an absence of labels."
C. L abels -f or Unif orm^femrfaj^jirers^
The Men's Clothing Code Authority made special arrangement whereby
9782
-167-
the Uniform Manufacturers, a serai-autonomous group and r the Cole,
co aid sapervice the distribution of their own labels. This arrange-
ment and reasons therefor arc explained in the following excerpt from
the report of the Label Committee, dated November 8, 1933: (*)
"The Label Committee estimates that not more than a
million and a half labels mould be used on uniforms
daring the current year. Sales of such a number of
labels would bring a gross income of $?,500 and
a net income of approximately $6,0u0.00. Off-
setting the net income of $5,000.00 would be an
expense of, in the opinion of the label commit-
tee, between -115,000.00 ar.d $2^,000.00 to ade-
quately police the -uniform industry b cause of
the large number of indivld lal manufacturers. It
is therefore concluded an agreement w.th the Nation-
al Association of Uniform Manufacturers whereby
labels arc sold to the Association at cost. The
National Association of Uniform I anufncturers oavs
the hen's Clothing Code A-tnori*-y $125.00 per month
for the necessary clerical work. The National As-
' sociation of Uniform ! ^-nufacturers sells the labels
to uniform manufacturers at the regular price of
$5.00 per thoasand, re^ainin? the lifference to
■ oay for the cost of administering; and enforcing
the Code amor_~ uniform manuf '■ ct orers. "
The National Association of Uniform i anuf act jers created an in-
tra-codal compliance problem around Larch 15, 1P34, by increasing the
price of labels from $5 per thousand to $12.50 per thousand for the
regular label and $15 per thousand for the uniform label. This action
was explained as necessary due to *"he precarious financial state of
the Association. (**) The Code Authorit-r did. not. aprrove this in-
creased charge for labels and uoon ins + r actions from Washington the
National Association of Uniform Manufacturers immediately reduced the
price to- $5.
(*) Report of the Label Committee of the len's Cloth-
ing. Code Authority, November 8, 1933. (lien's Cloth-
ing Code Files, under Committee Reports. )
(**) Letter dated June 5, 1934, from Harold W. Schwab,
Executive Secretary, National Association of Uniform
Lanuf act orers, to John R. Seecroft, Assistant Deputy
Administrator. (hen's Clothing Code files.)
9782
-168-
D. Retailers' Labels.
The use of the Hen's Clothin t Code label, or. goods manufactured
prior to the effective date of the Code, f?s protested on September 20,
1933, by R. H. Macy & Company of he'-' York City, as misleading and as
likely to lead to malpractices in the hen's:-: Clothing Industry and others.
(*) This protest was acknowledged o^ Deputy Administrator Rogers, who
state. , "I agree with you that for the labels to re?d 'Manufactured
under the Lien's Clothing Code Authority' is misrepresentation and I have
so informed the Code Authority."
Label sales to retailers for goods in stock" and transit assumed
considerable proportions. A reference to the Table XLVII on page 179
showing label sales and values, reveals that from September 6, 1933, the
beginning of sales, through the quarter ending June 30,1934, retail
labels were sold in the amount of 3,242,617, returning to the Code
Authority $16,213.12. The bulk of these labels, as would be expected,
were sold in the early period of the Code Authority operations. The
Chairman of the Label Committee of the Code Authority reported that up to
December 7, 1933, retailers numbering 1,045 had applied for labels and
that many of the orders received were for chain stores.
There appears no definite authority under which the Men's Clothing
Code Authority sold labels to retailers as such. The Retail Code, which
was signed by the President on October 21, 1933, and which became
effective the second Monday thereafter, provided that goods produced
under Codes requiring labels must have such labels attached when pur-
chased by retailers. Public opinion alone in its demand for label-
marked goods at the outset seems to have given both the authority and
means for selling labels to retailers. As a practical problem, had not
such sales been made, a compliance problem could have developed from
the impossibility of differentiating between goods ma.de under codes and
those already in stock or in transit.
3 . Reduced Price of Labels for Children's Suits
The Executive Director of the Men's Clothing Code Authority advised
the Administration on December 27, 1S34, that the Label Committee agreed
with the Code Authority's approval that certain suits and garments com-
parable with those manufactured under the Infants' and Children's '.Tear
Code be allowed labels at $3 per thousand instead of the usual charge of
$5 per thousand. Administrative approval was requested. This matter was
noticed for objections from January 21, 1935, through February 11, 1935,
as a possible alteration in the budget. The files show no criticisms
or objections to the proposal to charge $ r/ . for labels to be used on
children's suits. Prior to the time when official sanction could be given
this new label charge, the Administration approved a plan for continued
sale of labels at $5, "upon the agreement to impound $2, to be refunded
to the purchasers of such labels if and -.'hen the final order for' the new
budget is approved, fixing the new label charge . " (**)
(*) Telegram dated September 20, 1933, from R. H. Macy to Administrator
General Hugh S. Johnson; (Men's Clothing Code Piles).
(**) Letter dated Jan. 9, 1935, from S. H. Ourbacker, Assistant Deputy
Administrator, to George L. 3ell, 3xec. Director, Men's Clothing Code
Authority. (Men's Clothing Code Files.)
9782
-169-
Under date of February 11, 1935, Executive Director Sell reminded
the Administrator thr 1 raanufact-arers -ere eornplaining about I e ira r>und-
ing of the $2 differential and that "a., soon as the budget can be acted
on^.ve should have specific directions from you permitting the sale of the
labels direct at $3 per thousand."
P . Proposed deduction of Label Char^ for Single Pants .
Some time after the Code Authority's actio:: respecting a reduced
.charge for labels for children's garments, the issue of a preferred rate
for labels on single nants arose. Administrative approval was requested
of the Code Authority's decision, described by the following extract
from the minutes of the Executive Committee: (*)
11 ' The Executive Director brought up for consideration the re-
quest made by I'.v. J. E. Brill, representing the National Boys'
Pants Manufacturers Association, Inc., for a reduction in the
price of labels on single ants, which request v/as referred
to the Executive Committee ~oy the Code Authority at its meet-
in. on April 1", 193h; After much discussion it was unanimous-
ly decided that the Code Authority issue a special label for
use on single ants only, to be sold at the price of two
dollars ($3.00) per thousand; that this -rice be made retro-
active to a-; ly on all labels sole to single pants manufactur-
ers for use on single pants on and after April 15, 1933. '"
IV. THE BUDGET
The Men's Clothing Code Authority first ras.de definite plans for the
submission of a budget for Administrative approval around the first of
June, 1934. The Executive Director, in reporting to the Code Authority
at that time, called attention to the Administrative Order applying to
the use of labels, which was "to become effective June 13, 1934," stat-
ing that one of the requirements oi the Order is that the Code Authorities
concerned should submit a budget. (**) Ee concludes': "'"e have been in
hearty accord with this requirement, ana the b >t for the remainder of
the year will be submitted today for consideration." (***)
(*) Letter dated hay 14, 1933, from horrid G-reenberg, Executive Director
of the Lien's Clothing Code Authority, to waiter E. Voodford, Jr.,
Assistant Deputy Administrator. (Lien's Clotnin^ Code Piles, under
Budgets and Assessments.)
(**) The Executive Director is referring doubtless to Administrative Oi-der
X-38, signed May 13, 1934, -?.nd which became effective 15 days there-
after.
(***)Code Authority He-'ort of Executive Director, June 8, 1934. (hen's
Clothing Piles. )
9733
-170-
A more detailed explan ,tion of the delay in submitting a budget
for Administrative approval is found in a. letter of Kay 17, 1934,
directed to the Assistant Deputy Administrator in charge of the Code,
which reads in part as follows: (*)
"Together with the other Code Authorities that issue labels,
we have been withholding t le transmission of our budget
pending the issuance of the proposed regulations covering all
Code Authorities issuing labels, ~s the drafts of the pro-
posed regulations have specific clause- dealing with budget
requirements and report^ of expenditures , -and we wanted to
be sure that our budget would conform with these regulations,
"We now understand that these regulations will be finally
decided upon within the next few days, and promptly there-
after we shall file with you our budget together with the
report of our expenditures to date, and a. statement as to
the plan for raising the requisite money through the
Prior to the above-indicated plans for the submission of a budget
the Code Authority as reported by its Finance Committee on Kovember 8,
1933, and on June S, 1934, had made plans for independent audits, had
covered employees for a blanket surety policy and had provided for the
safe- keeping of funds in various bank accounts, jiving right of with-
drawal to only properly-authorized officials.
The first official Administrative recognition of the budget is
found in Order hoi 15-35 dated October 13, 1934, and covers a notice of
opportunity to be heard on the budget period from July 1, 1934, to
December 31, 1934. The total amount for the period was $225,000 and
it was proposed that labels be sole 1 at the rate of 35 per thousand.
Earlier, on September 14, 1934, the Executive Director advised the
Code Authority that the budget in general had been approved, but that
certain additional information was desired by the Research and Planning
Division of 1T.R.A. This information appears to have related to al-
location of funds for label publicity and to duties, salaries, and back-
ground of the Code Authority officials. The controversy concerning
the use of funds for label publicity lias been discussed above under
the heading "Labels."
On January 9, 1933, by Administrative Order 15-49, the budget for
the period July 1, 1934, to December 31, 1934, was approved. The
total amount provided in the budget was $225,000 and a label charge
of S5 per thousand was approved. The approval of this budget attached
certain provisos as follows: The Code Authority must submit not later
than January 31, 1935, a report with reference to (a) the more econom-
ical administration of the code through consolidation of Administrative
agencies whereever practicable, and (b) such other economies, in local
and national administration as appear desirable. It was further pro-
vided that the Code Authority commence a study and report on the
(*) Letter dated May 17, 1934, from George L. Bell, Executive Direc-
tor of the Hen's Clothing Code Authority, to John R. Beecroft,
Assistant Deputy Administrator. (Men's Clothing Code Piles, under
Budgets and Assessments.)
97R2
-171-
equitability of the present system of label c tar ;es, — consideration
to be given volume of business dene in various ">ric ' es, etc. The
Code Authority \ r i ) I -• ■ ■•'- ■ PS t bmifc a
jet, in proper form covering o era.tions. subsequent to this budget,
net later than Janu ry , I 5. It was further provided that S3, 600
collected under this bu '. for the ir -e of 1 be] v rtisin; to
be held in trust subject fo further oder oi the H.I.R.A.
The Dudget plan for the last half of 193' nd the basis of
assessment was extended Janu ry S, , Order Mo. L5-5 , pending
further order. This extension v/as "on a pro rata basis" subject to
conditions contained in the Order approving the July 1, 1934 — December
31, 1934, budget. This action was requested by telegram of January 2,
1933, by the Code Authority, in or r t time might be had for sub-
mission of a new budget to cover the first half of 1935.
Shortly after the extension ^J the b ' ■■ t on a pro rata basis,
the basis of contribution, i. e., the label charge , was noticed
for hearing under Administrative Order No. 13-55, dated January 33,
1955. dor the guidance of the Administration, the views of members
of the industry and all others concerned were desired relative to the
proposal to charge $3 ^er thousand for labels to be used on the
following children's garment ;, - Labels to be sold at 35 per thou-
sand for use on all jther garments:
Rugby Suits
Eton Suits
Reefers
Overcoats
Knickers
Eoys ' long pants suits
Topcoats and overcoat.;
Mackinaws
In compliance with the Administration's request both in respect
to previsions of Administrative Order :!o. 15-49 and a reminder tele-
gram from Assistant Deputy Administrate] Ourbaclcer on January 15, 1935,
the Code Authority submitted to the Administration around January 15,
1935, a budget covering the first six months of 1935. Accompanying
this budget were extracts from the minutes of the Code Authority's
Executive Committee which read as follows:
"Further discussion was had concerning the budget for the first
six months of 1935, and it was decided unanimously that, although
an amended budget may have to be filed later on, there should
now "be submitted a budget with an estii net income from the
sale of lace 1 .- of 3180,000 for the sin months' period from
January 1, to July 1, 1935, or an average of $50,000 per month.
"It was also unanimously decided, that the budget submitted at this
time for the first six months of 1935, with specific allotments
mired, be for a total of $180,000. In the allotments of the
various functions as required in the budget form of the Admini-
stration it was decided that the present actual rate of expenditures
3732
sir.es
4 to 10
it
••', to 10
ii
3 to 10
« .
:: to 10
ii
G to 16
ii
10 to 16
n
11 to 15
ii
6 to 16
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"be set. out, the total of which will avr-roximate $39,0 T) average
per month, and that the balance between that average per month
' and $30,000 "be entered as a reserve for oontingencies, such as
hearings on proposed amendments to the Code, hearings on inter-
pretations, etc., for legal expenses and retainer of attorneys in
connection with litigation that may "be instituted, research study
and general unforseeable incidentals."
An examination of the proposed budget for the first six months
of 1935 shows no change in the Code Authority'.: estimate for the need
of funds as compared with the last si:; months of 1934. Both budgets
estimate a net total sum of $130,0 X) for each of the respective periods.
The matter of "equitability of label charges" already reported 'on to
the Administration as above indicated, is specif ically. allowed for...
in the new budget in estimating revenues upon the basis of $3 labels
for certain children's wear. (Also see below under Cost of Cede
Aut ho r i t y to t he I ndus try.)
A summary of the issues in this budget problem as outlined on
February 28, 1935, by an Administration official to the Assistant
Deputy Administrator in charge of the Code, will present the chief
points and types of criticism which actuated Administrative conduct
in this matter. (*) The survey points out:
"The Lien's Clothing Code was adopted on September 6, 1933, and the
Code Administration organized thereunder carried on its affairs
without an approved budget from September 6, 1933, to June 30,
1934. A budget was submitted covering the period from July 1,
1934, to December 31, 1934, and formal approval of this budget
was given on January 9, 1335. do formal a; roval has been given
for any subsequent budget for the period after December 31, 1934,
or for a budget covering the period from September 6, 1933, to
June 30, 1934.
"An audit report has been submitted which indicates income re-
ceived and expenses incurred for the budgetary period from
July 1, to December 31, 1934. These incurred expenses for this
budgetary period a.re in excess of the budget provisions in t.ie
total amount of $6,058.56."
The author of the above goes on to argue that iundamental theory
on budget expenses "resupposes that actual or incurred expenses must
conform to the previously-determined amount provided for in the budget,
thus building up a case in favor of withholding funds which have been
saved on certain items, as against "aging them our on certain accounts
which overran the budget estimate. He conduces that four problems
stand out in the Men's Clothing Code Authority Budget, as follows:
(1) The accounts payable a.s of December 31, 1934*
(2) The revision of the budget for the period July 1, to Decem-
ber 31, 1934, to include all incurred expenses over and above
t he app roved budge t .
(*) Memorandum dated February 28, 1932, from 3. L. Iberts to
■Assistant deputy Administrator Walter E. Woodford, Jr., (Hen's
Clotni'ng Code Files.)
9782
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(3) The submission of a budget and an audit for the period
Sept ciber ', 1933, to June 30, 1934.
(4) Bucket for period after December 31, 133' .
3*01 loving, ir a s i lary of the remarks made res lecting the four
problems abover-out lined: (*)
(1) Suggests that all items of accounts payable be remitted
immediately to creditors oecause tin . • du are not in
excess of the budget revisions, with one exception* specifically legal
enses.
( .'• ) Susies ts that for the period July 1, to December 31, 1934,
the proper procedure for the Code ■- ' i ilstrator is to submit
at the earlies ] JssibL i be a revised bud et and request ap-
proval. In so doing, full and accurate explanations must oe
set forth stating the r sasons for the variance from the items
of expense contained in the original' budget. "That is, the
exces: o: salaries of Sll,340.06 over the amount provided in the
budget." "The item of legal expense of $13,896.92 which was
included in the xudit report of general expenses, must be ex-
plained iully in all detail and justified as necessary in all
particulars." Explanation must be riven as to why two associate
counsel were employed i:i Ealtimore on the !-r'eif case. Explana.-
tion should be made oj : the 37,500 to be paid firm of General
Counsel in view of Counsel's capacity a-- Secretary and Counsel
for the Code Authority on a s I irj basis,
(3) In order to meet with all necessary formalities the Code
Authority should arrange to submit a budget of expenses for the
period September 6, 1933, to June 30, 1934. Likewise an audit
re >ort should be submitted and should "bo similar in form to the
audit report submitted for the period July 1, to December 31,
1934.
(4) The Code Authority is now functioning without an approved
budget. It is suggested that the O Le Authority take immediate
steps to give full attention to all items pending upon budget
and audit in order th t they may be clarified and 'placed in order
at. the earliest possible dace. This is in the interest of
effecient management and is necessary to allay and forestall
the possibility of criticisms and adverse publicity.
In the meanwhile creditors of the Code Authority were pressing
for payment and the Executive Director in letter of February 9, 1935,
ashed permission of the Administrator Co meet bills payable as of
December 31, 1934, statin that the Code Authority had plenty of funds
and submitting Administration Member Mitchell's rec mmendation support-
ing the request. (Mr. Mitchell's approval was qualified with respect
to extra legal fees above mentioned.) This matter was called to the
attention of the Code Authorities Accounts Section, which advised
the Administrator that the Code Authority should determine which of the
(*) Conclusions drawn by Mr. Eberts in reporting to the Deputy
Administrator on the -en's Clothing Code Authority Budget.
9732
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accounts may be paid without exceeding the budget Hither in the indiv-
idual items or in total. It was likewise s ggested that the Code
Authority submit immediately a revised budget covering the period
ended December 31, 1934, re-allocating the amounts in such fashion that
the other excess may be paid.
Certain irregularities in the budget indicated by the above re-
view were forcibly brought to the attention of the Executive Director
of the Code Authority on March 23, 1935, in a letter from the Deputy
Administrator in charge of the Code. The Deputy Administrator stated:
"Items that are the subject of chief criticism of the Code
Authorities Accounts Section are the following:
"1. Over-payment of two months' salary to Executive Director
Bell upon his. resignation.
"2. Extra legal services in the sum of $5,000 paid in Grief
case.
"3. Extra legal services paid to Mr. Drechsler over fixed
annual retainer or salary.
"Obviouslv the need for over-payments should have been stated
with adequate covering or supporting information to justify.
Instead they were paid without submission for approval and are
now pending under criticism and objections mentioned.
"May I take this opportunity to say that we understand, of
course, that in the day to day services and activities of the
Code Authority it is possible the need for expense not antici-
pated ^y the Budget will be encountered. When this situation
arises, however, it is very easy to report it with the ac-
companying facts and circumstances.
"Sound business practice dictates that budget limitations must
be observed." (*)
In connection with criticism of specific items of the Men's
Clothing Code Authority Budget , it is significant that on the
occasion of the temporary vacancy in the office of Executive Di-
rector, Deputy Administrator Vincent suggested to the Administrative
Division concerned, that the salary of this office be brought in
line with sound policy. (**) Mr. Vincent set forth his recommenda-
tion and reasons therefor as follows:
"I recommend that the Director's salary item be reduced to $12,000
per year. ( Note : Director's salary budgeted at ^25,000 per year).
In malhng this recommendation, I do not wish to be understood as
suggesting this amount as an inflexible maximum. I do believe
(*) Letter dated March 23, 1235, from Deputy Administrator M. D.
Vincent, to Morris Greenberg, Executive Director, gen's Clothing Code
Authority. (Men's Clothing Code Files, under Budgets and Assessments)
(**) Memorandum dated february 28, 1235, from Deputy Administrator M.
D. Vincent to Research and Planning Division. (Men's Clothing Code
Piles. )
-175-
- t $12,000 or at most $15^000 per ann-um takes into account the
importance and res si-M'lit.v of- the office in a re?.s ■ Slj
liberal way. $1, , ) is equal to the salaries paid by the
government to executives in most responsible positions, including
members of the Cabinet. 7or fche National Recovery Administration
to -allow salaries, greatly in excess of sue a a lount lias aln d;
aroused and will doubtless continue to call fortli criticism.".
9732
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A. Summary of the Financial Re-ports Covering the Budget .
The activities of the Men's Clothing Code Authority were financed
by the sale of labels which were purchased, "by the manufacturers from
the Code Authority. The total of labels sold to April 30, 1935, was
137,700,579, yielding the sum of $688,368.77. (*) The Code Authority
estimated that their requirement for one year was 90,000,000 labels. (**)
An examination of the reports made shows: (***)
Gross Income from September 6, 1933,
to April 30, 1935, amounted to $706,164.55 1/
Cost of printing labels 131,666.62
Net Income $574,497.93 2/
1/ Including return from labels and other income (service income
from uniform labels, fines, etc.)
2/ Net income before operating costs.
Cost of operation from September 6,
1933, to April 30, 1935 499,207.41
Surplus for period $ 75,290.52 (****)
The financial activities of the Men's Clothing Code Authority were
divided into three periods:
September 6, 1933, to June 30, 1934, for which no budget
was ever submitted.
July 1, 1934, to December 31, 1934, for which the budget
was approved January 9, 1935.
(*) See Table XLVII. Number and Value of Labels Sold by Men's
Clothing Code Authority.
(**) Review of N.R.A. Label Agency Activities, by Dean G. Edwards,
N.R.A. Label Agent.
(***) (a) Report Upon Examination of Income and ^xpenses for period
ended June 30, 193 A , by Lybrand, Ross Pros., and "ontgomery.
(b) Report Upon Examination of Accounts as at December 31,
1934, by Lybrand, Ross Bros., and '■'ontgomery.
(c) M. C. C. A. Report for the "onth of April, 1935.
(****) The surplus on the Men's Clothing Code Authority Report for
the Month of April, 1935, shows $74,784.38 due to a balance
of $43,460.33 being used in the Report for the Month of January
instead of $43,966.47 shown in the Report upon 'Examination of
Accounts a s at December 31, 1934, by Lybrand, Ross Bros., and
Montgomery.
9782
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January 1, 1955, to June 30, 1935, for which the "budget
was submitted hut rr'ver a-v-.rovecL The budget a^-
-oroved for the last half of 1934 and the "basis of
assessment was extended January 9, 193!% "by Ad-
ministrative Order ^ T o. 15-50, Toen&Ang further Ord^r.
The first period ret>ort sho-vs: (*)
Gross Income Seotember 6, 1933, to June
30, 1934 *345 } 810.90
Cost of Labels 67,355.06
Net Income $278,454.84
Cost -of Oneration
Accounting 8- Lahel Dent. $16,775.76
"Enforcement ' " v 79 ,489 „ 32
Publicity 8,514,99
Statistical 10Jl72.09
•General Office Expense' ' 67,289.56' 182,241.72
Excess of Eecerots over Expenses $ 96,213.12
A budget for 'the period from July 1, 1954, to December 31, 1934,
was axroroved January 9, 1935, for
Estimated Gross Income $225,000.00
Estimated Cost of Printing Labels 45,000.00
Estimated Net Income $180,000.00
Budget Exclusive of Label Cost $180,000.00
The second neriod report shows: (**)
Gross Income $178,991.91
Cost of Printing Labels 30,880.46
Net Income $148,111.45
(*) Re-oort uoon Examination of Income and ""xnenses of the Men's
Clothing Code Authority for neriod ending June 30, 1934, by
' Lyb'rand, Ross Bros., and Montgomery.
(**) " Reptirt uoon Examination of Accounts as at December 31, 1934,
by Lybrand, Ross Bros., and Montgomery.
9782
Cost of Operation
Salaries $124,088.66
Office Expenses 25,300.07
Travel Expenses 31,423. _8
General Senses 14,864.22 , m ... ..
Other Special Outlay 4,681.67 200,358.10
Excess of Expenditures over Receipts * 52,246.65
Showing expenditures of $20,358.10 over the approved Budget .
Surplus as of June 30, 1934 * ll'lll'lt
Less Deficit for the period -x.,-.-b.oD
Surplus December 31, 1934 $ 43,966.47
The budget for January 1, 1935, to June 30, 1935, was never approved,
Administrative Order No. 15-50, extending budget ^J?' 6 ^ .^^'^
15-49, dated January 9, 1935, on a pro rata basis until further order hy
the National Industrial Recovery Board, was signed January 9, 1935.
Code Authority operated under this Order up to the decision of the
Supreme Court! The net amount of the proposed budget ™ **° J^^
that for the previous period, i. e., $180,000 exclusive of the cost of
labels.. The estimate on income was somewhat changed, as follows.
$221,000.00
Estimated Gross Income * »
' Estimated Cost of Printing Labels _i.uuu.uu
. v _ t $180,000.00
Estimated Net Income + '
The third period report for the first four months ending April 30,
1935, shows: (*)
$181,361.74
Gross Income 33,430.10
Cost of Labels •
_ . T $147,931.64
Net Income
Cost of Operations
General Administration $21,371.66
Compliance 74,958/24
Finance — Shipping 5,871.61
Publicity 67.50
General -xpense 14,338.58 116 . 607 . 59
Excess of Receipts over Expenses * ^ *° .'
Surplus December 31, 1934 -A,»bb.-r
Surplus April 30, 1935 $ 75,290.52
(*) Men's Clothing Code Authority Report for the Month of April, 1935.
9782
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The cost of operation was $3,3.92*41 -under the amount called for
under the "budget for the four months ending April 30, 1935.
B . Cost of Code Authority to the Industry- .
• In, considering'the expense of operating the .Fen' s Clothing Code ■
Authority, it is of Interest to note that the thrice at which the labels
were sold was so low (eaual to \i rer single , garment plus the actual
cost of sewing on the label) that there was no material charge to be
added to ■ the cost of manufacturing the individual garment or to the
selling -orices of same.
■ " The Men's Clothing Code Authority in presenting their proposed
budget for July 1, 1934, to December 31. 1934, on September 27, 1934,
under "Income Estimate Based on Label Sales, Gross and Net Income"
stated:,
■ "I.t is estimated that, we would sell during the six-month period
approximately 45 s 000, 000 labels. The price of the label was there-
fore fixed as l/2i per label to yield the gross revenue required.
"The gross amount of business of the Clothing Industry at wholesale
amounts to approximately 5 500 .000, 000 <, 00 per year. In 1931,
according to the Census reports, gros-s value of product was
• $513,792,000.00 and in 1929, $841,101., 000 »-00;. On the basis of the
• gross value of business estimated, the-^Label, charge represents 9/10
of a mill per dollar of product.
"The assessment on the industry in the purcha.se of labels repre-
sents, on the average, therefore, 90c* per $1000.00 value of pro-
ducts sold. In the case of a concern doing a $1,000,000 worth of
J* . business, the charge , for labels for the year would be on the aver-
age, $900.00. Th,e charge of the industry for administering the
Code, can, therefore,, be considered as a very reasonable one.
"The relation of' .the, cost of the label to Che wholesale price of a
suit is indicated as follows:
Suit .Selling at Thole sale
Percent' Label Cost
of Selling Price
expressed in 1000' s
$13.50
($22.50)*
.110
$15.00
($25,001*.
.100
$16.50
($27.50)*
.090
$18.00
(<*30.00)*
.083
$21.00
($35.00)*
.071
*Figures in parentheses represent retail prices.
"In 1931, according to United States Census reports, the average
wholesale price of a suit was $16.15. The bulk of the suits sold
today average approximately this figure.
9782
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"***The consensus of opinion among manufacturers is that a eystom
of separate labels' for variously priced garments would create con-
fusion and result in errors. It would also involve imposing con-
siderable administration expense on the Code Authority and a check-
up of the books of the individual manufacturer's invoices, shipping
records, etc., to determine whether the proper label had been placed
on a given 'garment » The eroense involved would far out-weigh any
saving even to the manufacturer of the cheaoer garment. Moreover,
sinc^e the cost of orintins; the label is a fixed charge, the net
revenue-available for administration would be, reduced more than
proportionately with the reduction of the orice of the label for
the lower oriced garment, . .
"The attitude of the manufacturers is in favor of the oresent
system. This is indicated in the vote at the last meeting of the
Code Authority on a proposal that manufacturers should use one type
• of label for the coat, a different .type of label for the pants and
still another for the vest. The manufacturer representatives were r.
unanimous that it would out a considerable burden on them in the
routing and handling of three different types of labels in their
shops, even if the manufacture of clothing were carried on in a
separate unit for the manufacture of coats,, another for oants, and
a third, for vests. . . .
"The administration eroense for handling of labels has been held to
a minimum by the Code Authority. It is estimated that approximately
3fc of the gross revenue has been required to operate this depart-
men t . " ( * )
The table "Principal Products, .by Class and Value, 1923 and 1925,
and by Class, Quantity and Value, 1927-1934" on page 51, Chapter I,
indicated a product value for the Men's Clothing Industry of $397,876,000
for the year 1934. Compared with the actual cost of the Code Authority
for the calendar year 1934, . estimated in the auditor's reports at
$399,860,. 68 (including cost of labels), this shows a cost, of approxi-
mately one mill per dollar of garments produced. Incidentally, the
auditor's reports show an excess of income over expenses of $8,945.92
for the calendar year 1934. ;■;.'
V. Il'TPEPH'ETATIOITS AMD INT T TRPR^TATIOK PROC^URE
It was discovered soon after the adoption of the Men's Clothing
Code that interpretations of many of its provisions were necessary to
its proper execution. Most of these interpretations and especially the
more significant ones have to do with wage and hour provisions, and can
be discussed to^etner conveniently^ Moreover, the procedure in connection
with the framing of these interpretations and their presentation for
(*) "Income Estimate Based on Label Sales, Gross and Net Income,"
Code Authority Budget for Period .from July 1, 1934, ( tq December
31, 1934. (Men's Clothing Code Files.)
"i
9782
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Administrative cnnsideration is an excellent commentary upon the manner
and character of cooperation between the. Code Authority and the Adminis-
tration and appears to justify the discussion of "interpretations"
separately and apart from related aspects of developments under the
Code.
A. Interpretations Submitted for Administrative Approval . ,,
Eight interpretations relating to separate and distinct problems
are stated bythe'Code Authority to have been given oral appraval as
early as September 26, 1933, by Dr, Lindsay Rogers, who was at that
time the Deputy Administrator and Administration Member on the Code
Authority,
(These interpretations are quoted below.,)
These interpretations were first submitted to the Administration
f or *tnxmal ap >roval on October 15, 1934, by Administration Member B.H.
Gitchell, who explained that oral approval had been given earlier,
"At that time the only .approval necessary in' connection with Code inter-
pretations. (* ) These- interpretations are now sent yov. in accordance
with the present procedure so that the records can be thoroughly
clear." . The -submission, of these interpretations was acknowledged
October 15, 1934, by Deputy Administrator Dean G. Edwards with the
comment, "We will act upon these interpretations as 'promptly a3 poss-
ible so' that the records can be entirely clear in this regard. "
•With but five exceptions, .it seems that the above-mentioned in-
terpretations had not obtained official approval prior to December
28, 1934, at which time the entire list said to have been approved
orally by Deputy Administrator Rogers, together with eleven additional
interpretations, were submitted to the Administrator by the Code
Authority. In submitting these interpretations for approval, * the
Comptroller of the Code Authority states', " : we have, not yet had
official approval of interpretations Number 1, 2, 4, 5, 6, 8, 9,10,
11, 14, and 18 - — -would appreciate hearing from you as soon as poss-
ible about these interpretations. " i~ t ■ '•' .• • . nr .■;. !'
The list of, these interpretations follows, together with the date
of approval by the Code Authority:
"1. Tailors- to- the- trade-hours of labor
"On behalf of the branch of the Clothing Industry
known as tailors- to- the-trade, conferences were held
(*) "Office Order 47, issued on D e cember 11, 1933, required inter-
pretations to be a proved by 1J.R.A*. This Order was finally
supplemented by Office Order 1I . 60, issued January 16, 1934,
which approved an order of procedure for the approval of inter-
pretations involving their submission before approval to the
various II. R. A. Advisory Boards." (J. G. Latimer, Legal Division
K.R. A. ) Men's Clothing Code Piles, .under Senate Hearing.)
9782
«183b
with . sentatives of labor, and as a result of such
I ;cnces, it was the intent of the conferees that
before any extra hours of work would be permitted to a
tailor-to- the- trade, he would be required to satisfy
the Code Authority that he had taken on additional
employees to full plant capacity, and that in such event
he would be permitted to operate his plant and employ
the manufacturing employees on the basis of 4C hours
each week, for a period not to exceed 6 weeks of the
full season of 1933 and up to and not later than November
30, 1953* *• ■
Approved September 6, 1935
"2. ITon-manufacturing employees as used in Article II,
shall be construed to refer to the excepted employees
mentioned in Article IV.
Approved September 6, 1933.
"3. Cleaners and basting pullers have ''jecn defined as
' manuf ac tur ing emp 1 o y e e s . '
A p roved September 26, 1933.
"4, The word "cutters' as used in Article II, Sub-
difision (a) is defined as follows:
"Cutters on cloth include those cutters that make, lay, aid
I 9V mark, cut by hand or machine, fit or chop.
"Cutters on linings shall include only markers, and hand or
machine cutters on coats, body linings and vest back linings.
Approved September 26, 1933.
"5. The word 'eff-pressers' as used in Article II, Subdivision
A, is defined as follow;;:
''Sff-Pressers on coats will include all hand or machine pressing
performed on the coat after the lining is felled. 3ff-pressers
on vests by hand or machine on the body and lining presser after
the vest is finished. Off-presser on pants and knee-pants by
hand or machines or the top presser and leg presser. Off -
pressers do not include under pressors commonly known as part or
piece pressers.
Approved September 26, 1933.
"6, The words 'substantial classes' as used in Article II, Sub-
division 3, a:, e to include 20 per cent of the total number of
employees employed in any establishment.
"If however, there is any individual case in which 20 per cent
seems inequitable, the full facts of such case are to be com-
municated to the committee provided for in Article II, Sub-
division E, for their further consideration.
Approved September 26, 1933,
9782
-184-
"7. Subdivision B of Article XII shall not apply to such manu-
facturers who' make "garments for tailors- to- the- trade or special
orders houses where such garments are made to measure for indi-
vidual customers.
Approved September. 26, 1933.
"8. Ho provision for' close-outs or clearance sales for topcoats
is f ound "':i Article" X. The decision of the Code Authority is that
topcoats, either for the spring or fall, may be closed out at
such periods as the manufacturer deems desirable.
Approved September 26, 1933.
"9. In interoretating the words 'average of 40 hours' used in the
second paragraph of Article IV for certain employees, the inter-
pretation committee of the Code Authority will advise each manu-
facturer to arrange his hours in such a manner which will be most
convenient for his business provided that they do not exceed an
average of 40 hours per week during enj yer-r.
Approved September 26, 1933.
"10. With respect to making up "time -for holidays, the interpre-
tation committee advised that if the employer can arrange with
the employee to put in 36 hours in anj one week, with not more
than 8 hours in any one day, such arrangement would be consistent
with the provisions of the 'Code. ■
Approved September 26, 1933.
"11. Application Article II, paragraph ( b) - (The interpretation
No. 6) - the words 'substantial classes' as used in Article II,
Subdivision (b.) are to include 20 per cent of the total number
of employees employed in any establishment.
"If, however, there is any individual case in 'which 20 per cent
seems inequitable, the full facts of such case are to be commun-
icated to the committee provided for in Article II, Subdivision
(d) for their further consideration.
"This interpretation shall become effective with the first
payroll following U vember 20, 1933, and shall not be retroactive.
(illustration annexed hereto.)
Approved ITovember 8, 1933.
"12. Lining pressing after off-pressing' is classified as 'off-
pressing, '
Approved December 8, 1933.
"13. Undei-collar cutting is not cutting as defined by the Code,
Approved December 8, 1933. '
"14. A non-manufacturing employee working less than a full week
should be paid at an hourly rate for the number of hours worked, —
Approved December* 8, 1933
"15. Where customer's labels are sewn on in the stock room they
should be classified as non-manufacturing employees; labels put
9782
-185-
on by machine or hand in the factory, should be classified as manu-
facturing employees.
Approved December 3, 1933.
"16, Bundle boys end packers are to be classified as non-manufact-
uring employees.
Approved December 3, 1932.
"17. Bu.shelmen, not including final inspectors or final examiners,
are considered as manufacturing employees; final inspectors and final
examiners are non-manufacturing employees.-;
Approved December 8, 1933.
"18. Interpretation re' Article V - The Committee rules that N.R.A.
labels must be attached to Rach garment when the same is in the
process- of manufacture vr] et er said garment is mace in an inside
shop or in a contract shop.
I : r 8, 1933. "
As already indicated, certain of the above-listed interpretations
had received Administrative approval in one form or another. Eight of
this group, by number as above-listed, 3, 4, 5, 6, 7, 8, 9, and 10, were
understood to have 'been approved orally by. Deputy Administrator Eogers.
Number 8 of this group of eight had ot<en written into the Code as an
amendment on December 15, 1953. Of the group, only five, specifically,
ICos. 5, 11, 12, 14, and 16, had been approved by Administrative Orders.
The list of interpretations submitted by the Code Authority on
December 23, 1954, above-listed, was acknowledged on January 3, 1935,
with the following comments and suggestions, referring to interpreta-
tions by number:
"1. This is not the prop.er topic for an interpretation but should
be handled in the form of an amendment. The Code Provisions clear-
ly give the Code Authority specific powers to set the week and hours
of overtime during peak seasons, but does not present any other
restrictions. These provisions may- be for an entire industry,
individual group or for a section of the country. The cjde
is also silent on the determination of the -peak season.
"2. This tends to amend the Code ant! should be submitted as an
amendment. Makes direct interpretation and not by reference.
"*'. This tends to amend the Code a:iC should be submitted as an
amendment,
"5. This tends to amend the Cod<4 and should be submitted as an
amendment,
"6. This interpretation is almost a reiteration of interpretation
Ho. 11 one. it is not necessary to approve both interpretations,
I would recommend that the Code Authority state which interpre-
tation it prefers.
"10. I T, the first paragraph under the interpretation the words
•the interpretation committee advises that' are being deleted.
9732
-186-
This is being put through as an explanation as the language of
the Code is not in sufficient doubt to warrant an interpretation.
"11. See interpretation lIo„ 6 above.
"14. This should be changed so that under the heading, facts,
should be included the provisions of the Code which refer to
the fourteen dollar weekly rate and also that there be quoted
from provision (e) of Article II that portion of the provision
guaranteeing the minimum rate of pay whether by piece rate or
other basis. The paragraph in the interpretation under the
heading 'question' should be changed to read:
'If a non-manufacturing employee is employed for less than a
full week, he may be compensated at an hourly rate which would
yield for a full time week of the number of hours as provided
for in the Code, the weekly minimum- established by the Code.'
"However, the Code should be amended to provide for a weekly wage
which shall be 'at the rate of $14.00.'"
During the time that the Code Authority and the Administrator were
attempting to "clear the records" witlrrespect to interpretations for-
mulated by the Code Authority early in" its experience, another group-
of interpretations had been approved by the Code Authority in its meet-
ing of March 2, 1934, and were brought to the attention of the Adminis-
tration soon thereafter. It is interesting to note that Administrative
approval of these interpretations was delayed until around the middle
of July, 1934, at which time thirteen out of the fourteen submitted
were formally approved. On being reminded by the Code Authority, the
Administrator on June 7, 1934, explained delay up until that time by
writing, "I regret very much that in the press of other matters these
interpretations have been slightly neglected. This is not entirely due
to negligence, but mainly because of the form in which these interpre-
tations were submitted." The letter then goes on to explain the proper
form of transmittal, indicating that each interpretation should be on
a separate sheet with a certain number of copies and carrying the re-
commendation of the Administration Member. By June 12, 1934, the in-
terpretations had been submitted in the form requested, and by July
19, 1934, had been acted upon.
The interpretations approved by the Code Authority on March 2, 1934,
and later approved by the Administration (with one exception, No. 14),
are as follows:
1. "A worker who is employed in the cutting of master patterns
if such work is done in a department wholly segregated from any
manufacturing operations is classified a non-manufacturing em-
ployee, A person who cuts a paper pattern from a block pattern
is a cutter within the definition."
2, "Routing of work from cutting room to the various shops, after
parts are assembled and tied, is a non-manufacturing occupation."
9782
-187-
3. "A person who checks the lay and/or the cut, and neither marks,
cuts or fits, shall be classified as a supervisory employee."
4. "A worker who checks the lay after it has been marked by the
cutter, and/or cuts and/ or assembles or fits the various parts
after they have been cut by the cutter, is a cutter within the
definition. "
5. "A worker, engaged in the sponging and shrinking of cloth,
shall be classified as non-manufacfruxing, provided, however,
that this work is done before the cloth is cut, "
6. "A worker who carries patterns to and from the racks, shall
be classified as n~on~manuf acturing. "
7. "An employee engaged in the printing of joker tickets shall
be classified as non-manufacturing. "
8. "A worker who cuts canvas and selicia as -well as vestbacks
and body linings shall be compensated at the . rate of not less
than $1.00 per hour for the time spent in cutting vest backs
and body linings and may be compensated at a lower rate for the
time spent in cutting canvas and selicia, on condition that the
employer shall keep an adequate and proper record which will
disclose the number of hours worked on each of the several
operations, the amount of earnings received per hour, and if
the work is on a piece work basis, the piece work rates."
9. "An employee who wots cloths for the off-presser., shall be
classified as a non-manufacturing employee, and not as an off-
presser. "
1C. "An employee whose work is divided between operations which
are classified as manufacturing and non-manufacturing,, shall
be compensated on the basis of the number of hours worked on
each of the several operations, on condition that the employer
shall keep an adequate and proper record which shall disclose
the number of hours worked on each of the several operations,
the amount of earnings received per hour, and' if the work is on
a piece work basis, the piece work rate."
11. "Brsheling on garments sold at retail direct to the consumer
and returned for alteration by the consumer, is a non-manufactur-
ing operation only when such cperations are carried on in a
separate department wholly distinct from manufacturing operations."
12. "The earnings of any worker shall be determined on the basis
of the number of hours worked in any one week. "
13. " A worker who cuts a piece of lining from the bold and uses
a pattern as a guide for cutting said lining, is a cutter within the
definition. "
14. "Wrier e two or more persons, engaged in the manufacture of cloth-
ing, perform productive labor in the manufacture of such clothing
such persons come within the province of the lien's Clothing Code. "
:-i88-.
B. Interpretation Publicity. [Ho
The Code Authority made known to the Industry i-ts various inter-
pretations including those approved "by the Administration in the manner
and on the dates indicated by the following!-'
"Interpretations 1 to 18 inclusive, were distributed to all members
of the Hen's Clothing Industry by the Code Authority in a circular.
letter "dated January 6, 1934. Attached hereto- is a copy of a letter
sent to 'the industry- transmitting these interpretations, iJSee last
paragraph of this letter.) Prior to being circularized throughout
the Industry, these interpretations appeared in the trade Journal of
the Ken' s" Clothing Industry, the- DAILY HEWS RECORD, issues of
November 11, 1933, November 13, 1933, and December 20, 1933,
respectively.***
"An additional number of interpretations approved by the Admin-
istrator on August 7, 1934, August 8, 1934, and August 9, 1934, and
August 15, 1934, respectively, was published in the DAILY NEWS RECORD
of August 22. 3.934; ****«<(*)
(*) Letter dated February 27, 1935, from Morris Creenberg, Executive
Director, Hen's Clothing Code Authority, to M. D. Vincent, Deputy
Administrator. (H e n's .Clothing Code Files.)
9782
-139-
C'. Administrative Orders Approving Interpretations
Out cf the entire list of around thirty-two interpretations ap-
proved by the Code Authority, and -oossibly two or three others to he
mentioned below, only eighteen received a.Tynrova.1 by Administrative
Order. One additional interpretation as above -oointed out, had been
placed in the Code by amendment.
In order to ^resent a clearer picture of the nature of the inter-
pretations approved by Administrative Order they are summarized at
this uoint with brief comments, where aToronria te, upon their sig-
nificance:
Order No. 15-14-A, signed June 9, 1934, provided that:
"The words 'substantial classes' as used in Article
II, subdivision (b) are to include 20 -oer cent of
the total number of employees employed in any estab-
lishment.
"If, however, there is any individual case in which
20 per cent seems ineaui table, the full facts of such
case- are to be communicated to the committee provided,
for in Article II, subdivision (d), for t.~:eir further
consideration.
"This interoretation shall become effective with the
first Toayroll following November 30, 1933, but shall
net be retroactive."
ILLUSTRATION (NOP.T")
Kow to arrive at the Amounts of Increase
to be given to the Higher Paid Classes
Under Article II - ( b)
Total of Manufacturing employees in your factory 100
Employees of "lowest -oaid substantial classes
201 of total" SO
Average earnings cf the said 20 employees in
the "lowest naid substantial classes" for
one full week immediately r>ricr to July 14,
1933, which, for the Tour^ose of illustra-
tion, we shall say are il0.40
This was arrived at as follows:
8 earning $9.00 - $73.00
4 earning 10.00 - 40.00
8 earning 12.00 - 96.00
Grand Total 1208.00
9782
-190-
Divided by 20
(number of "lowest -naid employees") $10.40
Cede Minim-urn (Northern Section) $14.40
Average difference therefore to be maintained is $4.00
So that the wage of each worker whose earnings
prior to September 11, 1933, was $10.40 or
over, and wo to $26.00, shall be increased
by $$2000
Those who had earned 527.00 shall be increased
by $3.00
Those who had earned $28.00 shall be increased
by $2.00
Those \«rho had earned $28.00 shall be increased
by $1.00
The above illustration is to be used by you
as a guide only .
«
If the average for the 20^ "low'est Daid substantial
classes" is higher than that given in t he illustra-
tion, then the average difference to be maintained
would be correspondingl.y lower.
If the average for the 20^ "lowest t>aid substantial
classes" is lo"rer than that given in the illustra-
tion, then the average difference to be maintained
would be correspondingly higher.
0782
- : .! • -191-
ILLUSTRATION
( SOUTHED SECTIOII )
How-to Arrive at the JLnourits of Increases to be Given
• to Higher Paid Classes Under Srticle II — Section (b) .
Total of manufacturing employees in your factory 100
Employees of "lowest -oaid substantial classes"
2(A of total" 20
Average earnings of the s;iid 20 employees in the
"lowest naid substantial classes" v for one full
week immediately nrior to July 14, 1933, which,
for the purpose of illustration, we shall say
are ft 10. 40
This was arrived at as follows:
8 earning ' $9.00 - $72.00
4 earning 10.00 - 40.00
8 earning 12.00 - 96.00
Grand Total .- $208.00
Divided by 20
(" T umber "lowest -oaid employees") $10.40
Code Minimum (Southern Section) :;13.32
Average difference therefore to be maintained is $,2.92
So that the wage, of each worker -whose earn-
ings nrior to- September 11, 1933, was
$10.40 car over, and un to $27.08, shall , .
be increased by $ 2.92
Those who had earned $28.00 shall be increased.
by ' $2.00
Those who' had earned $29.00 shall be increased
by ' $ 1.00
The above illustration is to be used by
you as a guide only. ", • .".. .
If the average for the 201 "lowest -oaid substantial
classes" is higher than that given in the illustra-
tion, then the average difference to be maintained
would be correspondingly lower.
If the average for the 30*^ "lowest rjai'd substantial
classes" is lo'^er than that given in the illustra-
tion, then the average difference to be maintained
would be corresnongingly higher."
9782
' .) > ;
This interpretation respecting "substantial Classes" is signifi-
cant because the Code Authority has based thereon its enforcement of
the entire clause concerning wages above the minimum. The enforcement
of Article II, Subdivision. (b) has been the major administrative
problem of the Code Authority, .as will be shown more particularly in
tiie Chanter "Labor Under the Code." It should be recorded here,
however, that the Industrial "Recovery Association has assailed, the
Administration and the Code Authority for acting under "this interpre-
tation, which the Industrial Recover;/ Association came to regard an
outstanding instance of modification of the Code by -power unjust if iably
assumed.
Order !> T o. 15-18, signed July 19, 1934, Provided that:
"Busheling on garments, sold at retail direct to the
consumer and returned for alterations by the consumer,-
is a non-manufacturing operation only when such operations
are carried on in a separate department wholly distinct
from manufacturing operations."
This interpretation relating to Article II of the Code allows com-
pensation to non-manufacturing employees on a basis of a weekly
minimum of $14.00 in the Northern area and S13 in the Southern area.
Order 7o. 15-19, approved July 19, 1934, provided that:
"An employee whose work is divided between operations
xvhich a-r-e classified as manufacturing and n on- manufacturing,
shall be compensated on the basis of the number of hours
worked on each of the several operations, on condition that
the employer keep an adeauate and proper record which will
disclose the number of hours worked on each of the several
operations, the amount of earnings received per hcur, and
if the wsrk is on a piece work basis, the piece work rates."
This interpretation of Article II Prevented the classification of a
worker in a lowest paid class when employed on various types of work
with differences in rates of pay. Article II makes no provision for
a combination of two types of work in one job.
Order Ho. 15-30, approved July 19, 1934, provided that:
"A worker who carries patterns to and from the racks,
■shall be classified as non-manufacturing."
In some plants this work is done by cutters who are skilled and who
are paid relatively high wages. A carrier or cutter's assistant under
this interpretation was definitely not a cutter, and could be placed
on a weekly wage basis.
Ordrr Fo> 15-21, signed July 19, 1934, provided that:
"A person who checks the lay and/or cut and neither marks,
cuts or fits, shall be classified as a supervisory employee."
-193- •
This inter-ore tat ion definitely removed the "checker" from the "cutter"
class, which was -naif 1 on the hourly wage basis' and was subject to the
more rigid hour provisions of the Code,.
Order No. 15-22, signed July 19, 1934, provided that:
"An employee wno wets cloths for the off-presser shall be
classified as a manufacturing employee and not as an off-
presser. "
This interpretation placed the "cloth wetter" in the class paid on a
40 cents v>er hour minimum basis, fs against 75 cents for the off-
presser.
Order "o. 15-23, signed July 19, 1934, provided that:
"A worker who cuts a niece of lining from the bolt and
uses a pattern as a guide, is a cutter within the' definition. "
This interpretation placed the lining cutter, as described, in the
category of the "cutter," the- highest paid manufacturing class
recognized in the Code, and -entitled to minimum pay of ,; ;i.^0 per hour.
Order I"o. 15-24, siened July 19, 1934, provided that:
"touting of work from cutting room to. the various shops,
after -oarts are assembled and tied, is a non-manufac-
turing occupation. "
This allowed for payment to workers so engaged on the basis of the
';i4.00 minimum ->er week.
Order l T o. 15-25, signed J8h$_Y 19, 1934, provided that:
"A worker who is employed in the cutting of master patterns,
if such worrc is done in a ienartment wholly segregated from
any manufacturing operations, is classified as a non-manufac-
turing employee. A person '"ho cuts a -oaper pattern from a
block pattern is a cutter within the definition."
Cutting master patterns is usually done before the manufacturing
season begins, and nrecedes the manufacturing process.
Order No. 15-26, signed July 21, 1934, provided that:
"A worker engaged in the sponging and shrinking of cloth
shall be classified ar non-manufacturing; nrovided, however,
that this work is done before t. .e cloth is cut."
The processes mentioned here are done in separate departments of
certain establishments and are technically not part of the manufacturing
process, but a textile finishing -process. The classification made, as
for other non-manufacturing employees, makes possible pay on a weekly
basis as nrovided in Article IT.
9782
-194-
Order No. 15-27, signed July 21, 1934, Provided that:
"A worker who checks the lay after it has been marked
by the cutter and/or cuts, and/or assembles or fits ■ ■
the various parts after thay have been cut by the
cutter is a Cutter within the definition."
Checking of the lay requires a high degree of skill and the inter-
pretation insures pay for a job equivalent to that of cutters.
Order No. 15-28, approved July 23, 1934, provided that:
"An employee engaged in the printing of joker tickets
shall be classified as non-manufacturing."
This process is usually done in the stock room, is a printing
operation separate and apart from the process of manufacturing
clothing.
Order Mo. 15-29, signed July 23, 1934, provided for the com-
pensation of workers cutting canvas and selicia as well as vest back
and body linings at rates of pay customary to both processes — R1.00
per hour for vest. backs, etc., and less for canvas and selicia — pro-
vided proper records are kept by the employer. This interpretation
involves the same 'principle as No. 15-19 above.
Order Mo.. 15-30, signed July 23, 1934, provided that:
"The earnings of any worker shall be determined on the
basis of the nunber of hours worked in any one week."
Some factories had been paying workers on the basis of average number
of tickets turned in during a four-week period. The Code Authority
thought this could make possible evasion and thought tickets should
be turned, in weekly.
Order i!o. 15-40, signed December 7, 1934, provided that:
"Lining pressing, after off-pressing, is classified as
off-pressing. "
In some plants lining pressing is done before the lining is felled
and hence is considered pa.rt of piece pressing, which is compensated
for at a lower rate than off-pressing.
Order No. 15-41, signed December 7, 1934, provided that:
"Bundle boys and packers are to be classified as non-manufac-
turing employees."
Order No. 15-42, signed December 12, 1934, provided that:
"Cleaners and basting pullers, are considered manufac-
turing employees."
9782
-195-
Order No. 15-60, signed February 19, 1935, provided that:
"Bushelmen, not including final inspectors or final
examiners, are considered as Manufacturing Employees,
except that bushelmen working on garments sold at
retail direct to consumer and returned for altera-
tions by the consumer are nan-manufacturing employees when
working ir a separate" department wholly distinct from manu-
facturing departments; final inspectors and final examiners
are nnn-manuf acturing employees. "
The facts upon which the above interpretation wfs based are as
follows:
"Bushelmen repair or correct imperfections in the manu-
facture of a garment and as such nerform work done by
manufacturing employees in the shop. Final inspectors
or final examiners merely determine whether the work
has been pronerly done and inspect same; they do no re-
pairing or correcting of imperfections and their work
is frequently done in the stock room and not in the
factory. "
Suggested Interpretations Not Ap-nroved By Administration
Among the interpretations approved by the Code Authority
March 2, 1934, is found the following:
"Where two or more -persons, engaged in the manufacture
of clothing, perform -productive labor in the manufac-
ture of such clothing, such persons come within the
province of the Men's Clothing Code."
The Administration did not see. fit to recommend approval of
this requested interpretation, giving as the reason, "***the foregoing
attempts to impose an obligation on an entrepreneur to pay himself
a minimum salary and is therefore objectionable. ***A restriction
as to hours of labor would not be objectionable."* The Code Authority
urged further consideration on the grounds that the lack of such
interpretation ^ould encourage or make -possible cooperative organisa-
tions of serious conseouence-.
Finally, on January 29, 1935, the Code Authority followed the
Administrator's suggestion and submitted an interpretation for
approval which followed the wording of the above-quoted interpretation,
except it provided: "***such persons shall be subject to the pro-
visions with respect to the limitations of hours as defined by
Article IV of the Hen's Clothing Code." Acknowledging this new inter-
(*) Letter dated September 17, 1934, from M'.'D. Vincent, Deputy
Administrator, to George L. Bell, Executive Director, Men's
Clothing Code Authority. (Men's Clothing Code Files).
9782
-196-
pretation, the Administrator advised Me Code Authority that' such
should take the form of an amendment, to the Code and, should be
offered for public hearing." (*)
The Code Authority propose^ on October 15, 1934, through the
Administration '"ember the following interpretations which were
designed to clarify the definition of "cutter:"
"Cutters on cloth include those cutters that make
lays and /or mark, cut by hand or machine , fit or
chop. " ... .
"Cutters on linings shall include only markers and.
hand or machine cutters. of coat body lining and
vest back lining."
F.R.A. Counsel advised' the Administrator'" that "the effect of
this interpretation is to amend the Cot* and it therefore should be
noticed for opportunity to file objections or hearing." Even prior
to this advice, when tue Code Authority made inouiries about defining
the term "cutter," the Administrator gave the opinion that the
definition of tie wage rate for cutters was clear and free from
abiguity and that the interpretation already approved in Administrative
Order No. 15-29 seemed to be a classification of work. It was further
suggested that the "classification" might stand unless objections were
made to it. (*.*,)
In line with the action of the Administration just rioted the
proposed interpretation: "TJnder-collar cutting is not cutting as
defined by the. Code," was not given Administrative approval, although
the records indicate that such interpretation received the approval of
all Advisory Boards, Research and Planning, and the Legal Division.
The He vie™ Division made the suggestion that "As the term cutting is
not defined by the Code it would oe better to state that under-collar
cutting is not cutting as understood by the industry."
On September 6, 1933, the Co^e Authority recommended for
Administrative approval the following interpretation:
-"Non-manufacturing employees as used in Article II
shall be construed to refer to the excepted employees
mentioned in Article IV. "
The "excepted" group included the repair crews, office force, etc.
This interpretation appears to have been rejected on the basis of
counsel's advice that such would amend the Code and hence could not
be approved. , r
("*") Letter dated January 39, 1935, from Assistant Deputy Administrator
Walter S. Woodford, Jr., to the Hen's Clothing Code Authority,
(lien's, Clothing. Code Files).
(**) Letter dated September" 18, 1934, from Assistant Deputy Administrator
'.., D. Vincent, to 3, H, G-itchell, Administration Member. ('fen's
g7gg Clothing Code Files).
-19?-
The Cleveland, Ohio, ".^.A. Conroliance Office on 'Tovember 20, 1934,
inquired of the Washington Conroliance Office:
; 'Is an outside salesman employed by a men's clothing
manufacturer guaranteed a weekly salary or may he he
naid strictly on a commission has is, 'low many hours
may he work, "
An official of the T.R.k. Textile Division advised in response
to this inquiry that:
"There is no official interpretation covering outside salesmen,
hut it is the o-oinion of this office that outside salesmen em-
ployed on a weekly salary or commission basis are not subject
to the provisions of the Code." (*)
Various interpretations relating to the use of labels have been
proposed by the Code Authority and submitter? for Administrative approval.
One such interpretation provided for the classification of employees
sewing on labels as manufacturing or non-manufacturing depending upon
location of the operation in the factory. The Review 'Division ob-
jected on the grounds that employees should not be classified by the
location of identical operations. Another label interpretation was
asked providing that labels should be attached to garments wnen in
orocess of manufacture. Counsel of M.3.A. advised that this was not
a proper subject for interpretation but should be submitted as a
requested change in label regulations which could then be approved by
the Administration.
Similar to the last-mentioned interpretation submitted for ap-
proval by the Code Authority was one -oroviding that employers could
arrange with employees in making up holiday time to -out in 36 hours
in any one week, with not more than 8 hours in any one day. This
interpretation, submitted on October 15, 1934, was approved as an
"explanation" under date of January 10, 1935. (**)
With respect to interpretations relating to Article II (b) it is
worthy of note that on January 17, 1935, Deputy Administrator
M. D. Vincent explained the term : ' existing'" in this Article as
follows: (***)
(*) Memorandum from S. H. Ourbacker, Acting Assistant Deputy
Administrator, to y.M.A. Compliance Division. ( :'en ' s Clothing
Code Files, under Classifications).
(**)' Letter dated January 10, 1935, from S. H. Ourbacker, Acting
Assistant Deputy Administrator, to George L. 3ell, Executive
Director, Men's Clothing Code Authority. (Men's Clothing Code
Files).
(***) Memorandum dated January 17, 1935, from "h D. Vincent, Deputy
Administrator, to R, W. Fuchs, N.R,A. Counsel. (Men's Clothing
Code Files, under' Code Exolanations) .
9782
-198-
"Any normal representative week before July 14, 1933,
may be agreed upon — as a basis for ore-Code calculations
in order t« determine whether the differential as it
then existed is being maintained in a normal repre-
sentative post-Code week."
The Code Authority in it? meeting of August 11, 1934, debated the
advisability of issuing an interoretation concerning' Sections (e) and
(f) of Article II of the Code, which provided: "(e) minimum wage
established, in this Code shall constitute a. guaranteed minimum rate
of -Day ;" and "(f) No increase in the amount of production or work
shall be required of employees for the purnose of avoiding the
benefits prescribed by this Code ."
It wa.s suggested that the following interpretation be agreed
uoon:
"It is proper therefore to infer that the emoloyee shall
not give any less work -oer hour than that given by him
before the Codf.
"If after the Code went into effect the -niece rates in
your shop were established so as to yield to the worker
at least the minimum wage without requiring him to do
more work -oer hour than he had done heretofore, he
should be paid the actual earnings on the basis of the
piece-work rates so adjusted."
Opposition to this interpretation was expressed by Mr. Fillman,
labor representative on the Cone Authority, for the reasons indicated
in the following excerpt from the minutes of the meeting:
"Mr. Hillman opposed, such inter-ore tation, holding that
an amendment to the Code was necessary; the Code pro-
viding for a factual minimum. TT e was frank in stating
that if the amendment was proposed he would op-nose
such amendment because it would break down the minimum
wage -orovisions of the Code. He said that the position
of the union in the organized markets was made very
clear and that the union at an Executive Session de-
cided that they would not countenance any laydowns in
any of the unionized markets. In the non-union
markets, ir. "illman's opinion was that the employer
could enforce production under the minimum wage by
lay-off or discharge."
E . Classific a tions .
There is a record of only one instance of the official classifi-
cation of a firm in connection with the lien's Clothing Code and that
instance is covered by Administrative Order T o. 15-43, relating to
the United Woolen Company, Columbus, Ohio. (The only other classifi-
cation order outstanding is Administrative Order ho. 15-38, relating
to "Cravenette, " etc., discussed in Chapter I).
9782
-199-
The United w oolen Corroany sold products tc customers through
outlet stores and advertised "custom- tailored suits, overcoats and
uniforms." The Conroany had 10'"> factory employees, produced around
500 suits a week, and operated on a 35-hour schedule, paying a
minimum wage of 40 cents ier hour, and a minimum wage of 80 cents
per hcur to journeymen. The Code Authority asserted that the
Company's methods are identical with those of " tailor-to- the-tradp"
firms under the Deri's Clothing Co^e, while the Company insisted that
it came under the Merchant and Custom Tailoring Code, although the
Code ATitnority of the latter had rejected tiie Company's membership.
The Administration ruled -that the Comoany in its manufacturing
activities fell under the Men 1 s Clothing Code. Its outlet stores,
however, it was ruled, fell under the Retail Code.
VI. COLLECTIO N ATJP US" 7 : 0?,-. STA TISTICS ■'•'••
In keening with the powers conferred u^on the Code Authority by
Article VIII of the Code, members of the Industry were required to
furnish nay roll data "showing by sex and occupation, number of
people employed, and the rotes of wages naid," and Production data
showing the number and tyoe of garments cut and made un. " Since
May 21, 1934, members of the Industry have been requested to furnish
a "Summary of Payroll Renorts" or a total of each page, in order to
simnlify the large and complex task of compilation of such data.
Under date of June 13, 1934, the Industry was advised that the
Code Authority had entered into a cooperative arrangement with the
Bureau of Labor Statistics of the United States Department of Labor
for the collection of employment and nay roll da.ta. It was explained
that under this arrangement pay roll reports which had been previously
sent to the Code Authority were to be sent to the Bureau of Labor
Statistics, Washington, D. C, where the reports were to be tabulated
and then forwarded to the Code Authority. Likewise, it was arranged
that renorts were to be filed on yellow sheets for uffice employees
and on white sheets for manufacturing employees. This device was to
simplify the compilation of the data and was to harmonize with the
practice of certain states, thus making unnecessary the filing of
many reports.
An arrangement similar to that described above, but respecting
production statistics, was entered into with the Bureau of the Census.
The Code Authority Committee on Statistics reported, under date of
March ?, 1934, that: (*)
" - "rly in January a joint arrangement was consummated
between the Bureau of Census and the Men's Clothing
Code Authority, whereby all production statistics would
be gathered jointly. The Bureau of Census sends out the
schedules in franked envelopes to all manuf acturers on
our list and on their list and receives the return in
(*) Report of Committee on Statistics, dated March 2, 1934. (Men 1
Clothing Code Files, under Committee Reports.)
9782
-200-
in franked envelopes furnished each manufacturer. The Bureau
of Census has undertaken to tabulate this data and supply the.
results to the lien 1 s Clothing' Code Authority. Toward the ex-
penses of this joint undertaking, the Bureau of Census con-
tributes $2,360 a year end furnishes the franked envelopes.
The Code Authority as its part pays $1,500 a year and furnishes
the schedules. The schedules , adopted pre the schedules pre-
viously approved by the Men's Clothing Code Authority."
The data collected "by the Code Authority was used chiefly in its
enforcement of various Code provisions, especially those having to do
with wages. The most extensive compilati ons of general data covering
the Industry were made in connection with the proposal to. add wage
classifications to the original Code provisions.
VII. Procedure Authorized But Hot Effected
It is observed that the Code Authority made no recommendations with
respect to the setting-up of a Service Bureau for engineering, account-
ing, credit, etc., as it is empowered to do by Article XIII, Section D,
Subsection (2) of the Code. Likewise, no action was taken under powers
granted in Article XIII, Section B, Subdivision (5) which allows for
establishment of an agency for supplying credit information. *
(*) Letter dated February 8, 1935, from David Drechsler, Secretary,
Men's Clothing Code Authority, to C. H. James, Executive Assistant,
Textile Division, K.R.A. (Men's Clothing Code Files)
9782
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CHAPTSS V
LABOH UNDER KEE CODE
I. HOUR PHOYISIOi:S--ISSUES 15 T7RITI5G
The lien's Clothing Industry Code provided in Article IV that
hours of viork in the Industry except for certain designated groups
"shall not exceed thirty-si:: (36) hours per reel: nor eight (8) hours
per day. 1 ] Also, "employees shall not operate productive machinery in
the Clothing Industry more than one shift of thirty-six (36) hours
per we el:."
The groups excepted from the 36-hour provision and for which
it was provided that .vork shall -not be "in excess of an average of
forty (40) hours per '/eel: during any year beginning with the effective
date," were "repair shop crews, engineers, electricians, firemen, of-
fice and supervisory staff, stock clerks, shipping clerks, truck drivers,
porters, and watchmen." ( Code Authority estimated that this excepted
class totaled approximately 35,000 during 1934.)*
Article IV also provided that " tailoring- to-th'e-trade and manu-
facturers of uniforms shall "be permitted overtime at regular rates dur-
ing pepk seasons, the number of hours and the number of weeks to be
determine-"- by the lien's Clothing Code Authority."
Both codes proposed for the '/en's Clothing Industry favored a
40-hour week. Proffcssor Herlove, adviser to the Clothing Manufac-
turers Association, asserted that:
"Government figures on wage earners, hours and volume of
physical output indicate clearly that weekly hour maximum
should be a maximum of 40 hours per week. It is firmly
believed that the proposed weekly 40-hour maximum standard
attains one of the principal objectives of the Industrial
Recovery Act, that of absorbing completely the existing
unemployed workers normally attached to the Industry."**
'.forris Kolchin, of the Research and Planning Division, 1IRA,
reached the conclusion that "It is evident that they cannot all be
reemployed, either on a 40-hour week maximum or a 35-hour week maxi-
mum, unless there is a considerable increased demand." Estimating
(*) Letter feted January 23, 1935, from George L. Eell, Executive
Director, lien's Clothing Code Authority, to S. H. Ourbacker,
Acting Assistant Deputy Administrator, (lien's Clothing Code
Piles.)
(**) "Statistical and Economic, Analysis Related To Sections 11 and
IV of the Code of Pair Competition for the lien's Clothing In-
dustry," ~b:j S. E. i T crlove. Page 4. (lien's Clothing Code Files.)
9732
-202-
that 48,000 were unemployed during the best month of 1935, Mr. Kolchin
concluded that a 40-hour maximum might give employment to 3,150 unem-
ployed, assuming an average of 27. 5 hours per week worked in 1932, and
that a 35-hour maximum might give employment to 19,503 people.*
In the course of hearings on the proposed codes, Labor Advisers
urged the necessity of a shorter maximum hour provision than the 40
hours asked by .members of the Industry. The final determination ap-
pears to have been influenced by the National Recovery Administration.
II. SPECIAL PRO 7ISI01IS FOE OVERTIME
The two codes as originally proposed for the Industry made no
provision for the exceptions finally provided for the Tailors- to- the-
Trade Division and Uniform lianufacturers, although the codes were in
close agreement respecting the special provision for the "excepted"
occupational groups above listed. The Tailors-to-the-Trade group from
the outset insisted that selling direct to the consumer on special order
necessitated special provision in hours. Accordingly, the codal provi-
sion agreed upon was a definite recognition that the business of Tailors-
to-the-Trado is more highly seasonal than that of the Industry in gen-
eral and does warrant longer /hours during the peak season. Uniform
manufacturers similarly demonstrated that theirs was a special order
business exit, highly seasonal.
A . Overtime for Tailors-To-The-Trad c . * *
Following are summaries of the Code Authority's resolutions
respecting overtime in the Tailors-to-the-Trade Division for the peak
seasons of 1933 and 1934 and for the spring season of 1935.
Fall 193 3; After conferences with representatives
of labor, the .ion's Clothing Code Authority agreed
to give Tailors-to-the-Trade extra hours on the
basis of 40 hours per week for a period not to ex-
ceed six week's of the Fall season of 1933 up to
and not later than November 30, 1933, provided
plants satisfied the Code Authority that they had
taken on additional employees to full plant capa-
city.
Spring 1934 ; Tailoring houses allowed to work 40
hours a week during the month of ''arch for weeks
ending March 1G, 23, and 30. During months of April
and hay, tailoring houses may work up to 40 hours
(*) "Material 3 ea ring on hen' s' Clothing Industry," by Liorris Kolchin,
Division of Research and planning, NKA, dated August 10, 1933.
(hen's Clothing Code Files.)
(**•) Granted by the Code Authority in accordance with, Article IV
of the Code; sue above and page 291.
9782
-203-
a week during any four weeks of the two months in
question, the privilege terminating on Decoration
Day. Houses may petition Code Authority for privi-
lege of working not in excess of 40 hours one addi-
tional week during the month of May. Same regula-
tions with respect to such overtime as prevailed
during the Fall season were agreed upon.
On ; arch 2, 1934, the L'en's Clothing Code Authority
amended the Tailor s-to-the-Trade resolution as
follows:
"Due to the emergency the tailoring houses can work
up to' 48 hours a week during the weeks ending March 24,
and Larch 31, it being understood, however, that rates
of pay would be tine and one-half for such hours worked
in excess of an average of 42 hours during the two
weeks ending L'arch 31."
Puling on extra hours for tailoring houses insofar
as it relates to contract shops:
"The privilege to operate 40 hours under said con-
ditions given to Tailors-to-thc -Trade houses under
authority of the resolution passed by the Code Au-
thority is limited to inside shops. This privi-
lege cannot be extended when a manufacturer is hav-
ing his work done on special orders in contract
shops because, if conditions warrant, the manufac-
turer can arrange to send additional work to addi-
tional contract shops. For that reason, the privi-
lege of operating extra hours granted to Tailor s-to-
the-Trade houses refers only to inside shops."
Fall 1534 ; Tailoring houses allowed to work 40
hours per week any seven weeks beginning September
17 and ending December 25. 7, r ork under same gen-
eral terms as applied to Fall and Spring for 1933
and 1934. This was approved by the Code Authority
September 14, 1934.
Above resolutions were amended to provide for any
eight weeks instead of seven weeks during the
present season ending December 25. Same condi-
tions and requirements to apuly.
Under date of I larch 2, 1935, the Tail or s-to-the-Trade
group, applied to the Code Authority for overtime, stating a
desire for 40 extra hours, beginning with March 15, and end-
ing gay 30 at the regular rates of pay; further requested
that the privilege be limited to inside shops and that privi-
lege be confined to those operating at plant capacity and to
9732
-204-
shops working solely in the making of garments to individual measure.
This request for overtime during the Spring peak of 1935 was
not approved in the particulars requested. The Executive Director
of the Code Authority advised the Administrator on darch 13, 1935,
that the previous ruling (confining overtime to inside shops) had
received protests from contractors and their employers, so that the
Code Authority finally agreed upon the following resolution on
i arch 12, 1935:
"Resolved, that Tailoring-to-the-Trade houses'
may work 40 extra hours beginning with the
15th day of darch, and ending the 30th day of
day, 1935, at regular rates of pay providing,
however, that no more than 3 hours in excess of
36 hours may be worked in any one calendar week.
"A Tailor-to-the-Trade house which wishes to
ajvail itself of this privilege shall certify
to the Code Authority that it has taken on ad-
ditional employees to the full plant capacity
and that the shop or shops in which overtime is
used is engaged solely in the making of garments
to individual measure."
B. Overtime for Uniform danufacturers .
Following are summaries of the Code Authority's resolu-
tions respecting overtime for the Uniform danufacturing branch of
the Industry for the peak seasons of 1953 and 1934 and for the
spring season of 1935. '
Fall 1935 : After arrangements with labor, uni-
form manufacturers allowed overtime of four hours
per week for eight consecutive weeks commencing
September 25 at the regular rates of pay. To ap-
ply to manufacturers having their own .shops or in-
side contract shops and in special cases where
they have outside contract shops which work' ex-
clusively for the individual uniform manufacturer.
In this connection, the Executive Director advises
that "At the time this arrangement was entered into,
:' t was the pra.ctice of the Code Authority to accept
the recommendation of its Labor members."
Lpring 1934 : On darch 2, 1934, rational Associa-
tion of Uniform danufacturers, after agreement
with Labor Committee, requested a period of eight
weeks of overtime at the rate of 40 hours per week
9782
-205-
at the regular rates of pay. Overtime to begin
April 2 and to encl the reek of May 26, applying
to manufacturers' own shops and where contracting
work is solely foi then. 3odo Authority agreed
with the provision that additional employees
would first be taken on to full plant capacity before
before petition for overtime would be granted,
and such petition must conform to the require-
ments adopted by the Tailors-to-the-Trade In-
dustry.
Fall 1954 ; Uniform manufacturers were given
privilege to work eight consecutive weeks 40
hours per week, starting the week of September
2d and ending November 19 under the same gen-
eral terms and conditions as for Fall 1933 and
Spring 1954.
Under date of February 26, 1935, Harold U. Schwab,
Executive Secretary, National Association of Uniform Manu-
facturers, petitioned for overtime beginning April 1, for
a period of eight weeks out of twelve weeks following under
the sane general terms previously granted. It was explained
that the preference for eight weeks out of twelve rather
than consecutive weeks was in conformity to the Administra-
tor ' s sugge s ti on . *
C. Right of Dode Authority to Determine Overtime period .
It should be recorded here that certain clothing manu-
facturers questioned the right of the Code Authority to de-
termine "just what shall be considered as their peak season."
The Deputy Administrator, after receiving the complaint, ad-
vised the Code Authority that "until the Code is amended to
care for this situation, the Code Authority have all of their
regulations in this connection approved by the MRA prior to
their attempt to enforce them."**
(*) Letter dated March 8, 1935, from Morris Greenberg, Executive
Director of the lien's Clothing Code Authority, to Assistant
Deputy Administrator Walter E. Woodford, Jr., (lien's Clothing
Code Files.)
(**) Letter dated November 5, 1934, from S. H. Ourbacker, Acting
Assistant Deputy Administrator, to George L. Bell, Executive
Director, Men's Clothing Code Authority. (Men's Clothing Code
Files, under Employment.)
97S2
-206-
III. EXEMPTIONS A1ID DENIALS OP ERUPTIONS
On Eebruary 23, 1935, the Men's Clothing Code Authority ap*.
plied to the Administrator for exemption from the hours provisions
of the Code for the entire Industry excepting Tailors-to-the-Trade
and Uniform Manufacturers. It was requested ths.t 40 hours per week
be allowed for five consecutive payroll weeks "beginning March 4,
1935, and ending April 6, 1935. In reouesting the exemption, the
Executive Director of the Code Authority advised that the (a) late
delivery of woolens and (b) excess of fancy models which have un-
balanced highly skilled sections, were reasons justifying the over-
time. The Administrator granted a ten-day emergency exemption pend-
ing the submission of a formal order to the various Adnivory Boards.
The formal order No, 15-61, dated March 12, 1935, was later issued,
granting the exemption as requested. A supplementary Order No. 15-
65, dated March 22, 1935, granted to the Tailors-to-the-Trade houses
eight hours overtime, in addition to the peak season overtime already
granted, to be used between April 6 and April 19, 1935, provided that
wages be paid at the rate of time and one-half.
Certain protests arose concerning the general hours exemption
granted the Men's Clothing Industry for the period above indicated.
Colonel E. M. Curlee, Counsel for the Industrial Recovery Asso-
ciation, indirectly expressed his disapproval of at least the manner
in which the exemption was handled by addressing the following ques-
tions to the Deputy Administrator on February 2V, 1935, having read
of the proposed request for exemption in the Daily News Record:
"Was any notice given to the Industry of an application
for this exemption and have there been any hearings
held? If so, will you tell me where I can get the
transcript of the record of the hearing. Have you any
knowledge of whetner or not certain institutions have
been operating on a schedule of more than 36 hours in
anticipation of an order authorizing it?"
Later, on March 15, 1935, Colonel Curlee, expressing further
his opposition to the granting of the overtime period to the entire
Industry, wrote to Deputy Administrator Vincent as follows:
"Seasonal peak production is a curse- of the Men's
Clothing Industry and prevails to the greatest extent
in the Code Authority area. Members of our Association,
at no. little inconvenience, risk, and expense, made
their plans' for continuous production on a 36-hour
basis. It affords an unfair competitive advantage to
producers in the Code Authority area to permit them to
evade the hazards of merchandising and then receive an
indulgence which legalizes their historical vice, of peak
production. If this is to be regarded as a precedent and
is to become an established practice, certainly the
method should be changed so that Producers not enjoy-
ing the confidence of the Code Authority should be
9782
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advised a sufficient time in advance to avail
thenselves of the benefits of these suspensions of the
law.
"I am instructed by the Industrial Recovery Asso-
ciation of Clothing Manufacturers to protest to you
against this so-called 'stay' as vicious in principle
and as having been improperly hranted without notice
to the industry."
The Administrator replied to Colonel Curlee on March 5, 1935,
advising of the granting of an emergency exemption pending approval
of a formal order, adding, "no hearing on the application was held
for the reason that the overtime exemption was granted for the entire
industry...." Again, on March 23, 1935, Deputy Administrator Vincent
stated in a letter to Colonel Curlee:
"The facts before the National Recovery Administration
appear to clearly justify the exemption. Briefly, for
your information, the situation appears to be that pro-
duction in February sharply increased over January,
this year. The emoloyment figures are perhaps the
best indication of the industry's need for overtime.
At this time employment is at the highest peak since
approval of the Code,
"My recommendation of approval of the exemption is
based broadly uoon the fact that neither the Code Author-
ity nor the national Recovery Administration should
retard or limit production in the face of market demands. "(*)
A more direct protest against the granting of the general hours
exemption came from the Philadelphia Joint Board of the Amalgamated
Clothing VJorkers of America. This group urged that the Order be with-
drawn and that no repetition of 'such action take place in the future.
Reasons for this stand were expressed as follows:
"...There is no shortage 'of labor because we are in
a position to supply all help necessary from our
unemployed membership and whereas there are a number of
firms in the city not availing themselves of these
extra hours, among them being three of our largest man-
ufacturers... we feel the granting of a forty hour week -
(*) Letter dated I Larch 23, 1935, from II. D. Vincent, Deputy
Administrator, to Colonel F, M. Curlee, Industrial Re-
covery Association of Clothing Manufacturers. (Men's
Clothing Code Files, under Employment, Overtime Exemp-
tions. )
9782
•203-
to the Men's Clothing Industry for even a tem-
porary period of two to five weeks is a move on the
part of same employers to introduce the ofrty hour
reek. "
Whether or not the suspicions of this labor group were war-
ranted is not known. The files dp not show any evidence that
members of the Industry were desirous of a change in the hour pro-
visions of the Code. There were to be sure, individual firms which
desired exceptions and exemptions, which situation is the subject
of the following division of this Chapter.
A. Exemptions From Hour Provisions Granted Small Groups and
Individual Firms.
It is significiant that the Men's Clothing Code Authority-
consistently took the position that it did not have the authority
to grant exemptions under the Code. All requests for hours exemptions,
as well as others, were directed to the Administration, sometimes
with a recommendation from the Code Authority.
In the" survey of hours cases oelow, it is important to remem-
ber that all hours exemptions both granted and requested have had to
do with employee hours. It is of course understood that a request
for or a grant of exemption from employee hours automatically carries
a request for or exemption from machine hours. There is not dis-
covered, however, in the Administration's files a request for exemp-
tion from that section of Article IV of the Code which provides,
"Employers shall not operate productive machinery in the Clothing
Industry mure than one shift of thirty-six (06) hours per week." In
the Men's olothing Industry prior to the Code, the single shift was
customary and the peak seasons were taken care of by long employee-
hours. ^Eyen with the codal restriction of employee hours to 36 per
week, there did not develop in the Industry a demand for a double
shift.
Order Wo. 15-8 , dated February 23, 1934, granted four hours
overtime, upon the recommendation of the Code Authority, to five
New Orleans, La. , firms, namely: Leon Godchaux Clothing Company,
Haspel Bros., Inc., Famous' Sternberg, Inc., Hirsch & 3aar, and A.
Solomon. These firms were manufacturers of summer clothing. Reasons
for the granting of the exemption were: (l) Firms were in competi-
tion with men's work clothes manufacturers working under the Cotton
Garment Code, which had a maximum work week of 40- hours (at that
time). (2) Firms accustomed to 58 hours per week and new 36-hour
schedule would create shortage in labor market. (3) No unemployment
in this branch of the Industry, and no surplus labor market.
Order No. 15-59 , dat'ed February* 12, 1935, terminated Order
Ho. 15-8 discussed above. This termination was effected at the re-
quest of the Hen's Clothing Code Authorit]' on the grounds that the
exemption had been granted originally to allow the Ne^ Orleans firms
to compete with the Cotton Garment people on a comparable basis of
40 hours and, "now that the prevailing hours under the Cotton Garment
9782
-209-
Code have been changed to 36, exemption from the Men's Clothing Code
rith like hours is unnecessary to fair competition."
Order Ho. 15-11 .dated April 27, 1934, provided for exemption
of all Puerto Mean manufacturers from hours and wage provisions of
the Lien's Clothing Code. For the two or three firms ship-Ding to
Continental United States, 40 hours maximum per week was allowed.
(For firms not shipping to Continental United States, complete
exemption from this Code was provided.) The Puerto Ricans, in pe-
titioning for relief, argued that workers in their country could
not produce comparably to workers on the mainland; that workers with
approval of the Commissioner of Labor of Puerto Rico were satisfied
with much lo^er wage and hour standards than provided by the Code;
that linen suits produced did not offer unfair competition to makers
in the United States.
Representatives of the Hen's Clothing Code Authority favored the
general exemption for Puerto Rico, and Executive Director 3ell, on
March 2, 1934, advised the Code Authority:
"...The volume of clothing exported from Puerto
Rico appears to be grossly exaggerated, and the re-
ports of the Bureau of Foreign and Domestic Commerce
"ere apparently incorrect. \Je are informed that the
Government report included men's underwear as men's
clothing. The indications are that at present there is
no real competition from Puerto Rican markets."
By Order I>To. 15-54 , d^ ted January 16, 1935, the provisions of
Order Ho. 15-11 -ere extended to June 1, 1935. The Code Authority
gave approval with the suggestion that the Order- should not be made
permanent and that by June 1 a plan could be worked. out on a per-
manent basis.
Order Ho. 15-12 , dated May 10, 1934, granted the G-oodall
Company, of Knoxville, Tenn. , the privilege of working four hours
overtime weekly until July 1, 1934. This Company engaged in the man-
ufacture of Palm 3each clothing and was granted the exemption upon
fundamentally the same grounds as was granted the exemption to the
New Orleans manufacturers discussed under Order Ho. 15-8. above.
On October 17, 1934, the Perry and Juden Company, New Orleans,
was granted an emergency exemption by telegram, allowing the Company
to work 15 hours overtime during the eight days from the date of the
telegram. The reouest for this exemption came from the Uniform Man-
ufacturers Division of ■ the Men ' s Clothing Code Authority, and was for
the purpose of enabling the Company to complete its contract with the
Louisiana Sta.te University .which requested uniforms for a demonstration
planned for a certain day.
The Louisiana State Director of Compliance objected to the ex-
emption under date of October _25, 1934, asserting that undue political
influence had been exerted by Senator Euey.Long. The Administrator in
replying to this criticism explained the origin and nature of the
9782
-210-
request for exemption, saying that Senator Long's name had not
ap-oeared in the transaction. (*)
On January 25, 1935, the Division Administrator granted a
ten-day emergency exemption to Joseph & Feiss Co., Cleveland, Ohio,
permitting the Convoany to work fifteen employees 8 hours daily
for 6 days for a period not to exceed two weeks. This exemption
was granted "because incorrect sewing machines had been supplied the
Company, and had delayed operations and handicapped enroloyment
throughout the entire factory.
For some reason, the formal Order approving the exemption for
a two-week Period as requested, from January 25, 1935, up to and
including I abruary 7, 1935, was mailed out to Joseph & Feiss under
date of February 18, 1935. Relative to which, Mr. Paul Feiss wrote
"while appreciating the evidence of cooperation of the Recovery Board,
regret that the authorization arrived too late to be of any help to
us, so that we did not avail ourselves of the permission granted. (**)
On March 2, 1935, the Division Administrator granted by
telegram a ten-day emergency exemption to DeMoulin Brothers, Co.,
Greenville, 111. , permitting the company to work twenty-five- em-
ployees of various occupations for forty hours per week for a per-
iod of three weeks beginning March 4, 1935, pending formal ruling.
This exemption was extended by formal order No. 15-62, March 3,
1935, on the grounds that the company had secured several orders for
band uniforms requiring immediate delivery
Order Ho. 15-60 A, dated March 7, 1935, granted to Bradford
College Clothes Co. , New York City, exemption from the hours pro-
visions of the Code in order. that the Company be enabled to com- •
pete on time a CCC contract for 20,000 pairs of trousers. It was
asserted that this contract was delayed in fulfillment because of a
breakdown in machinery.
On March 15, 1935, the Division Administrator granted to the
Mcintosh Studio Clothes Manufacturers, Los Angeles, California, an:
emergency exemption of ten dnys by telegram. The petitioner claimed
and was supported by the Label Review Officer for the Pacific' Coast,
that special motion picture wardrobe orders created an emergency.
(*) Letter dated November 1, 1934, from Deputy Adrainis-
trr ior Dean G. Edwards, to Director S. J. Gay, State
Director of Compliance for Louisiana. (Men's Clothing
Code Files. ) ' .
(**) Letter dated March 6, 1935, from Paul Feiss to
National Recovery Administration. (Men's
Clothing Code Files.)
9782
-211-
This exemption, "by Order No. 15-63, dated March 15, 1935, was ex-
tended to allow four hours weekly overtime at time and one-half,
or the privilege of an extra shift at the usual rates of pay.
Order No. 15-64 A, dated April 12, 1935, granted to Sheuerman
Bros., Inc., Des Moines, Iowa, an exemption from the codal hours
provisions for ten days, because of a "breakdown of certain machin-
ery. This exemption allowed the Company to work twelve pressers
one hour overtime each day for ten days at time and one-half pay.
Order Fo. 15-65 A , dated May 3, 1935, granted to H. A.
Seinsheimer Co., Cincinnati, Ohio, the privilege of working twelve
basters, twenty-five hand workers, including fellers, ten pressers
and ten operators, six hours over time on Saturday, May 4, 1935,
on sample work only, providing time and one-half was paid for
overtime.
Order Fo. 15-65 B , dated May 11, 1935, granted to Rose
Brothers, New York City, the privilege of working fifty cutters
one hour overtime each day for ten days, provided time and one-
half he paid for overtime. The request for exemption was "based
on threatened cancellations due to delay in cutting. It was
asserted that the Comaony normally employed 50 cutters, hut now
had 100 with no room for expansion of the plant.
Order No. 15-68 A , dated May 22, 1935 granted to I.tort0a»Brc;3; New
York City, the privilege of working its entire force one hour over-
time each day for a ten-day period beginning May 23, provided time
and one-half he paid for overtime. This Order, which carries no
reason for the granting of the exemption, was recommended by the
Code Authority and was approved by the Labor Advisory Board.
Order Fo. 15-68 3, dated May 22, 1935, granted an exemption to
the Champion Pants Manufacturing Co., New York City, allowing the
Company to operate its cutting room at Perkasie, Pa. , one hour
overtime each day for a ten-day period beginning May 23, 1935, pro-
vided time and one-half be paid for overtime. This Order states
no reason for the exemption, but carries the recommendation of the
Code Authority and the Labor Advisory Board.
B. Denial of Requested Exemptions from Hour Provisions .
The Sigmund Eisner Co., of Redbank, New Jersey, on November 15,
1934, requested an exemption from the hours provisions of the Code
for a period of two weeks beyond the eight weeks overtime period
accorded the Uniform Manufacturers. The request for extension of
the overtime period was based solely on the contention that the
textile strike had delayed delivery of piece goods. On March 16,1934,
the Administrator advised that the condition cited by the applicant
applied to the entire Industry and constituted no grounds for special
consideration.
Order No. 15-47 , dated January 3, 1935, denied the application
of the William Bradford plant of Kling Bros. & Co. , Chicago. The
9782
-213-
Conroany's appeal was based on the asserted impossibility of meet-
ing orders with lack of experienced workers in Eavenport, Iowa. The
Code Authority opposed this reouest for exemption on the grounds
that the Company had deliberately left Chicago where it had oper-
ated for several years and where a surplus of labor existed. Code
Authority argued that surplus work could be sent to available con-
tract shops and that bo gran!; the Company's request would create a
precedent in the direction of 'Breaking down the codal provisions.
When requested by the Administration, the Company failed to sup-
port its contention that more continuous employment was afforded at
the Bradford plant than prevailed throughout the Industry.
Orde r No. 15-56, dated January 30, 1935, denied to N. Snellenber^
& Co., of Philadelphia, Pa., a reouest for four hours overtime for
period from November 22 9 1934. to December 15, 1934. The Conroany
gave as reasons for the request "several municipal contracts for
police overcoats are now past due, 1 ' and that the plant had been
running to capacity since the beginning cf the season. The Code
Authority opposed this request, stating .that the Company had
already had 40 hoars for eight consecutive weeks as allowed other
members of the Uniform branch of + h^ Industry, and that no special
grounds existed bo. justify an extension.
Order JTo, IF 57, dated February 2, 1935, denied to Wender
and G-oldsfein, Lnce, Kew York City, a request for four hours
overtime for four weeks from December 5, 1954. No reasons for
denial are -given in the Order., The Code Authority favored de-
nial, however, on the grounds that there was an "adequate labor
supply in New York City to meet any emergency — no special cir-
cumstances seem to warrant exemption* "
Order No, 15-37 , dated November 13, 1934, denied overtime
to the Neptune Manufacturing Co., Louisville, Ky. , on the grounds
(l) Mis-statement of fact by the applicant as to permission grant-
ed by the labor union; (2) Failure to show facts indicating that
conditions or circumstances were exceptional; (2>) Setting of pre-
cedent of granting overtime will tend to break down codal pro-
visions. This denial was approved by the Legal Adviser with the
suggestion that the applicant be infarmed of his rights and proper
procedure and that the Cede Authority was remiss in not so ad-
vising the applicants, The Research and Planning Division suggest-
ed that the applicant be given opportunity to present information
sufficient to form basis of judgment.
On January 19. 1935, the E. E, Smith Co., of Bethel, Ohio,
petitioned for an hours exemption, claiming that lack of off-
pressing machines necessitated additional employees to work over-
time. Company also stressed need of employing "green" help from
time to time c The petition was made direct to Washington but
upon reference to the Code Authority elicited tne recommendation
that petition be denied. Administrator advised of method of appeal
to Administration and suggested that the plant would be investigated
by the Code Authority. When the petitioner advised on February 28,
9782
513-
1935, as to the impossibility of specifying his exact requirements
Tor overtime, the administrator then called attention to the fact
that the entire Industry was being granted overtime and it was hoped
that this would solve the Company's difficulty in production. The
Company was further advised that the learner problem had not been
settled by N.ReA.
Order No* 15- 1G, dated May 14, 1935 denied overtime to
Kurtzman Bros., Los Angeles, California. The applicant claimed
that it could not use the extra hours previously granted the In-
dustry; also claimed that its season did not correspond to that
of Eastern markets. The Code Authority had recommended denial on
the grounds that the Company was confronted with no peculiar con-
ditions placing it at a disadvantage with other members of the
Industry and that the overtime granted the Industry had been
used by this firm.
Order No. lS-o' 7 , dated May 17, 1935, denied the North Chicago
Clothing Company permission to operate a coat shop forty hours
for one week. The Company had based its request for overtime on
the need to meet a number of special rush orders. The Code Au-
thority advised the Administration that the applicant was suc-
cessor to a company held to be in violation of wage provisions of
the Code.
IV. WAGS PROVISIONS AMD ISSUES IN WRITING
The Men's Clothing Code as adopted on August 26, 1933, pro-
vided in Article II, for a minimum wage of 40 cents per hour for
manufacturing employees in the Northern area and 37 cents in the
Southern area; for non-manufacturing employees a minimum wage of
$14 per week in the Northern section and $13 in the Southern sec-
tion. Employees working on single knee pants were to be paid at
the rate of 37 cents per hour. A minimum wage for cutters was
established at $1.00 per hour, and a minimum for off-pressers at
75 cents per hour. It was further provided that "the existing
amounts by which wages in the higher-paid classes, up to classes
of employees receiving $30 per week, exceed wages in the lowest-
paid substantial classes shall be maintained."
In sub-section (d) of Article II it was provided that the
Code Authority "nay appoint a committee to supervi se the execu-
tion of the foregoing provisions."
The above provisions of the Code respecting rates of pay were
amended as follows: On December 15, 1933, by Executive Order,
Article III of the Code was amended to allow the employment of
learners for a period of three months after December 11, 1933,
to be paid not less than 70 per cent of the Code minimum wage;
on the same date it was -provided that handicapped workers may be
employed at a compensation not less than 70 per cent of the Code
minimum wage. The proportion of such persons was not to exceed
5 per cent of the total employed in any one plant, and all ex-
emptions were subject to review and denial by the Code Authority.
9782.
-214-
On December 18, 19133, the wage provision regarding workers on
knee pants was deleted and a provision was substituted there-
for providing a wage for such workers of 37 cents per hour in the
Northern area, and 34 cents in the Southern area. On the same
date, it was provided that employees working on wash suits of
100 per cent cotton content be paid 34 cents per hour in the
Southern area, and 37 cents in the Northern area. The wage rates
respecting cutters and off-pressers were similarly changed to
provide a rate of $1,00 per hour and 75 cents per hour respectively
in the Nortnern area as against 85 cents and 65 cents respective-
ly in the Southern area.
The two codes first prepared for the Men's Clothing Industry
were fairly well in agreement respecting minimum wages, out their
positions were irreconcilable with regard to rages above the
basic minimum. The Code proposed by the Clothing Manufacturers
Association recommended a basic minimum of 35 cents per hour in
the Northern area, and 32* cents in the Southern area; a minimum
for cutters at the rate of 80 cents per hour; and that "e xisting
amounts by which wages in the higher-priced cl a sses, up to work-
ers receiving $50 -per week , ex ceed wages in the l o west paid class -
es, shall be maintained. ". The Industrial Recovery Association's
proposed Code recommended that wages of all e m ployees be raised
20 per cent above the rates prevailing July 1, 1933 ; a minimum of
35 cents per hour in the North and 32^- cents per hour in the South,
It was suggested also that apprentices be employed at a mrnimum wage
not less than 75 per cent of the established minimum; payments
at the rate of time and one-half was recommended for repair crews,
engineers, and similar groups for overtime in excess of forty
hours per week.
With respect to w-^ges above the minimum, the Industrial
Recovery Association would not yield, but protested the general
provision of the opposing group for the "higher paid cla.sses" on
the ground "that it was vague, indefinite, and uncertain, and
incapaole of definite interpretation and application." (*) The
proponents of the finally adopted provision for -"'ages above the
minimum replied, together with the Deputy 'Administrator in charge,
that where the application of this provision would result in
hardship, +he Code Authority could give relief. This suggestion
was objected to on the ground that the higher wage bracket of each
manufacturer would be dependent upon the discretion of the Code
Authority.
In support of its suggested provision for apprentices, the
Industrial Recovery Association argued that there is little or
no trained labor to be recruited in the smaller communities and
(*) Statement of Industrial Recovery Association of
Clothing Manufacturers, February 2, 1935. Page 9,
(The "Green Book" — Men's Clothing Code Files).
9782
-215-
t some allowance in wages should be made for the training of
raw c eg inn e'rs. (* ) •.
In the final determination of the Code vage rates, the De-
puty Administrator seems to have relied principally upon a Report
of the Research and Planning Division, which is mentioned in the
Deputy's recommendation of the Code for approval. The Research
and Planning Division had concluded that the establishment of a
40-cent minimum hourly rate in conjunction with a 36-hour week
would result in a 28 per cent increase in the total payroll of
the Industry, estimated to represent an increase of around
$100,000,000 a year. (**) The Clothing Manufacturers Association
had estimated on the other hand that a 35-cent minimum wage com-
bined with a 40-hour week (allowing for a possible rise of 50 per
cent in raw material prices) would approximate -a 35 per cent rise
in the cost of suits. (***)
A. Proposed Amendments of ffa"e Provisions.
During the period of February 2-4, 1935, hearings were held
in Washington on two separate amendments, each classifying work-
ers for the purpose of setting up additional minimum wage rates.
One amendment proposed by the management members of the Code
Authority classified workers in the Industry into about fifteen
classes, with separate wage scales ranging from 4) cents per hour
(the existing minimum) to Si. 00 per hour. The labor members of
the Code Authority proposed an amendment similar in principle to
management's proposal, but providing for about thirty different
classes of workers, with separate wage scales ranging from 40 cents
per hour to $1.00 per hour. Management's proposal, but not labor's,
included a twenty per cent tolerance for sub-normal workers.
To understand the nature and extent of worker classification,
which would have resulted with the adoption of management's pro-
posal, it should be noted that, excluding cotton suits and single
pants, where a 37-cent rate prevailed for all operators (except
cutters and off-pressers) , only five minimum rates of pay would
(*) Statement of Industrial Recovery Association of
Clothing Manufacturers, February 2, 1935. Page 107.
(The "G-reen Book" — Men's Clothing Code Files).
(**) "Material Bearing on the Men's Clothing Industry,"
August 10, 1933, by Morris Kolchin. (Men's Cloth-
ing Code Files. )
(***) Statistical and Economic Analysis Related to
Sections II and V of "Code of Fair Competition for
the Men's Clothing Industry", by S. K. Nerlove.
Page 45. (Men's Clothing Code Files.)
9782.
-216-
resu.lt, including those provided for in the Code, namely: $1.00,
75 cents, 65 cents, 50 cents, and 40 cents. The Code Authority-
estimated that of the manufacturing employees classified by type
of operation and by management's amendment proposal, the 40-cent
minimum \?as applicable to 34.9 per cent of the total, the 50-cent
minimum was applicable to 51.8 r>er cent, the 65-cent minimum was
applicable to 3.5 per cent and the 75-cent minimum and above
was applicable to 9.8 per sent.
It was generally agreed that the proposals to add new mini-
mum wage rates to the Men's Clothing Code arose from the consider-
able difficulty which the Code Authority experienced in attempting
to enforce Article II (b), which dealt with ' ,r 7ages in the higher-
paid classes. " The management members of the Code Authority, in
support of their amendment, submitted statistical data purpoting
to prove that unfair competition in labor costs was occuring in
the Industry at wage's above the minimum. It was indicated that (*)
"although the number of workers receiving the minimum for all es-
tablishments combined is 19.7 per cent, some establishments pay
over 50 per cent of their workers only the minimum, and in indi-
vidual cases as many as 80 perf cent are at the minimunu " The
Code Authority further argued that the new rates were necessary as
an administrative means of enforcing Article II (b); would make un-
necessary continued reference to July, 1933, for purposes of
estimating wages; would simplify compliance in that employers and
employees (through posted rates) would be definitely informed as
to proper wage rates; would be applicable to firms organized sub-
sequent to adoption of the Code, not subject to Article II (b).
It was additionally asserted that the- wages as proposed would
affect only a small proportion of the Industry and would have no ef-
fect on clothing prices and that the rates were not designed to
equalize hourly wage rates throughout the Industry.
The minimum rates proposed by the labor group of the Code
Authority agreed in principle with the proposals of the manage-
ment group. Labor, however, favored a higher average minimum than
did management, and desired the recognition of more occupational
classes including workers in pants establishments. Labor expressed a
fear that the tolerance provision of management's .proposal would
result in an unfair disciplinary device.
The arguments presented against these amendments by the Indus-
trial Recovery Association were that the plan for classified rates
was contrary to general F.F..A. policy; would place a burden in wage
costs upon certain members of the Industry; would favor unionized
contract establishments as against integrated non-union establish-
ments; would increase the cost of clothing to consumers and react
against the Industry as a whole; that present lower wage rates make
for greater continuity of employment; would stimulate further mass
(*) See Transcript of Hearing on Amendments to Hen's
Clothing Code, February 2 — 4, 1935.
9782.
-217-
production by mechanical inprovements to disadvantage of workers;
id would make for added confusion in attemnting to adjust an hour-
ly base rate to niece rate method of payment prevailing in the
Industry. (*)
In this February 2 — 4, 1935, wage hearing, the Industrial
Recovery Association, in addition to opposing the amendments offer-
ed by the grouos on the Code Authority, recommended counter amend-
ments of their own to provide: (l) "that all wage provisions other
than that for the minimum be deleted." (2) "that Article II be
so amended as to make the definition of North and South conform
with economic, historic and geographic realities."
Regarding the last-mentioned amendment proposal, it should
be recorded that the issue of the North-South areas had been raised
before in this Industry. The codal definition placed the State
of Virginia in the Northern area. As early as September, 1933, we
find the Friedman-Harry Harks Clothing Company, of Richmond, Virginia,
protesting this arrangement on the grounds that the .system of pro-
duction in Virginia is different from that in the North, and that
trained workers were not so plentiful in Virginia as in Northern
cities. (**) Similar protests were lodged with J the Administration
by Sam Finkelstein and Comuany, Norfolk, Virginia.
Following the February 2 — 4, 1935, hearing on the proposal to
amend the wage provisions of the Code, there was submitted on April
4, 1935, to the various Advisory Boards of N.R.A. for consideration and
recommendation, the following Order designed to put into effect upon
Administrative approval new codal wage provisions:
."AMENDMENTS
"ARTICLE II OF THE CODE OF FAIR
COMPETITION FOR THE MEN'S CLOTH-
ING INDUSTRY BE AMENDED TO READ
AS FOLLOWS:
"Section A-
"1. The minimum -vage which shall be paid by em-
ployers in the clothing industry to their employees
employed as cutters, shall be at the rate of one dol-
(*) See "Statement of Industrial Recovery Association of
Clothing Manufacturers" ("G-reen Book") before the
N.I.R.3. and K.D.Vincent, Deputy Administrator, Feoruary
2, 1935. (Men's Clothing Code Files.)
(**) Letter dated September 14, 1933, from Senator Harry
E. 3yrd, to Deputy Administrator Lindsay Rogers.
(Men's Clothing Code Files.)
9782.
-218-
lar ($1.00) r>er hour "hen employed in the northern
section of the industry, and at the rate of ninety
cents (90<£) per hour when enroloyed in the southern
section of the industry.
"2. The minimum wage rhich shall be paid by em-
ployers in the clothing industry to their employees
enroloyed as cutters of men's wash suits of one hundred
ner cent (lOO;^) cotton content, when enroloyed in the
southern section of the industry, shall be at the rate
of eighty-five cents (85r) per hour.
"3. The minimum wage which shall be paid by em-
ployers in the clothing industry to their employees
employed as off-pressers, shall be at the rate of
seventy-five (75^) per hour when employed in the
northern section of the industry, and at the rate
of sixty-seven and a half cents (67-^rf) per hour
when employed in the southern section of the industry.
"4. The minimum wage which shall "ie paid by em-
ployers in the clothing industry to their employees
employed as off-pressers of Men's wash suits of one
hundred per cent (lOOfo) cotton content, when enroloyed
in the southern section of the industry, shall be at
the rate of sixty cents (60^) per hour.
"5. The minimum wage which shall be paid by em-
ployers in the clothing industry to their employees
engaged in operations requiring the use of a machine
for sewing, basting, padding, tacking, stitching, but-
tonhole making or button sewing, or of any other ma-
chine requiring the use of thread, shall be at the
rate of fifty-five cents (55«0 per hour when employed
in the northern section of the industry, and at the
rate of fifty-cents (50rf) per ho\ir when employed in
the southern section of the industry.
"6. The minimum wage which shall be paid by em-
ployers in the clothing industry to their employees
employed in any operation (other than off-pressing)
requiring the use of a hand pressing iron or a press-
ing machine, shall be at the rate of fifty-five cents
(55<#) per hour when employed in the northern section
of the industry, and at the rate of fifty cents (50rf)
per hour when employed in the southern section of the
industry.
"7. The minimum wage which shall be paid .by em-
ployers in the clothing industry to !their employees
employed in all hand operations, shall be at the rate
of fifty-five cents (55<£) per hour when employed in
the northern section of the industry, and at the rate
of fifty cents ( 50^) per hour when employed in' the
9782.
-219-
southern section of the industry, (following to be printed in
italics) except thread-makr catting; turning, paring or trim-
ming away of surplus materials; finishing or felling of any
kind; buttonhole marking, cutting and making; button marking,
button sewing, ticket sewing; cleaning; basting pulling; marking;
measuring, and that as to such excepted operations the minimum
wage rhich shall be paid by employers in the clothing industry
to their employees, shall be at the rate of forty cents (40(0
per hour when employed in the northern section of the industry,
and at the rate of thirty-seven cents (37$) per hour when em-
ployed in the southern section of the industry. It is intended
that 'paring or trimming a^ay of surolus materials' and 'marking,
measuring' shall not include shaping fronts, collars and bottoms.
"8. The minimum wage which shall be paid to all manu-
facturing employees (other than cutters and offpressers herein-
before provided for N , working on men's wash suits of one hundred
per cent (100$) cotton content, shall be at the rate of thirty-
seven cents (37$) per hour when employed in the northern section
of the industry, and at the rate of thirty-four cents (34$) per
hour when employed in the southern section of the industry.
"S. The minimum rage which shall be paid by employers
in the clothing industry to any of their manufacturing employees
who have not been hereinbefore classified, and have not been
identified by the operations to be performed by them, or the
nature or kind of garment upon which they are employed, shall
be at the rate of forty cents (40$) per hour when employed in
the northern section of the industry, and at the rate of thirty-
seven cents (37$) per hour when employed in the southern section
of the industry. .
"10. The minimum wage rrhich shall be paid by employers
in the clothing industry to any of their non-manufacturing em-
ployees, shall be fourteen dollars (314.00) per week when em-
ployed in the northern section of the industry, and thirteen
dollars ($13.00) per week when employed in the southern section
of the industry.
"11. 'Southern section' of the industry shall included
Alabama, Arkansas, C-eorgia, Louisiana, ' 'ississippi, North Carolina,
Oklahoma, South Carolina, Tennessee, Texas, and Florida. The
'northern section of the industry shall include all other states
in the United States.
9782
-220-
"Se tion 3 -
"The provisions for the minimum wage established in this
Code shall constitute a guaranteed minimum rate of pay in con-
nection with Loth a tine rate or s piece-work hasis of com-
pensation.
"Section G -
"'Jo increases in the amount of production or work shall
he required of employees for the purpose of avoiding the ben-
efits to employees prescribed by this Code in respect of rr ages
and hours of employment. All requirements in respect of such
increases shall he reported to the '."en's Clothing Code Authority.
"Section D -
"Persons whose earning capacity is limited because of phys-
ical or mental handicap, may be employed at a wage below the
minimum established by this Code, provided —
"1. That they shall be paid proportionately no less than
the other employees receive for similar work, but in no ca.se
shall their compensation amount to less than seventy per cent
(700) of the amount required by the I.inimum Wage Provisions of
this Code.
"2. That the proportion of such excepted persons to the
total number of employees in any plant shall not at any tine
exceed five per cent (5^).
"3. The Code Authority shall have the right to investi-
gate and disallow any claims for exemption. The decision of
the Code Author it - " - shall be final and the employer shall comply
therewith, unless and until the National Industrial Recovery
Board shall upon appeal dj an employer or employee, disapprove
the decision of the Cod.e Authority.
"4. That where it has been the custom of an employer to
maintain a proportion of such employees in excess of five per
ce ".t (5^1) of the total number of employees in his plant, the
Code Authority may, upon application and proof, allow the em-
ployer to employ more than five per cent (5fj) of excepted per-
sons, subject to these provisions.
"5. That on or before the tenth (10th) day of ea.ch month,
the employer shall prepare and transmit to the Code Authority a
list for the preceding month of such excepted persons, stating
names, class of occupation, wage rating, length of service, and
reasons for exception.
"6. These exceptions shall not be used by employers as a.
device to evade the provisions of this Code.
9732
-221-
"7. 'The Code Authority shall report to the national '
Ini stria] Recover;' Board within three (3) r.ionths, and
fron tine to tine thereafter, as to the effect of these
provisions, both generally and in cases of individual hard-
shin, so that the National Industrial Recovery Sor.rd nay
determine,, in its discretion, whether or not the provisions ■■ •.
of this amendment shall he continued or changed.'
"Section S. -
"Znployees em-ployed in the OT>~rations included in Sub-
divisions 5, 6, and 7^ of Section A of this Article:, hwhose. • ( ■
speed of production is' subnormal and who are rated by the
• employer as 'slow workers 1 , nay be employed at a vwage:. be-
low the nirina established in said Subdivisions 5, 6, and 7
-of Section A of this Article, provided:
"1.. That they shall be paid proportionately* no., less .•
: than the other employees- receive" for sinilar work,\but in
no case shall their compensation anount to less than forty
.cents (40$*) per hour when emoloved in the northern section,
of the industry, and thirty-seven cents (37V*) ner hour when
erroloyed in the southern section of the industry.
"2. That the -proportion of such (slow workers' to the ■
total employed on operations included in Subdivisions 3, 5,
6, and 7^ of" Section A of this Article shall not at any tine
e;:ceed twenty -per cent (20',j) of such total enployed in the
making of coats, and twenty per cent (20$) of such rtotal
enployed' in the making of vests, and twenty ner cent (20$) of
such total en-oloyed in the mailing of pants in any shop or
shoos :.iahing such coats, vests, or pants, where such shop or
shcos are located in one municipality.
"3. The enployer shall report on separate payroll
.sheets, and transmit to. the Code Authority, together with pay-
roll re-oorts as required under Article VIII, such 'slow work-
ers' excepted under this Section, stating names of workers or
their clod: nunbers (whichever is used in the filing of pay-
roll reports); name of operation; whether by hand or machine;
hours worked per week for the period reported; earnings ner
week for the period reported. ;
"On and after the effective date of this amendment, Sections
b. c. and d of Article II of the Code of Fair Conpet.ition for
the hen's Clothing Industry, as approved by the President on
August 26, 1933, and known as Axroroved Code No. 15, Registry
No. 216-1-06, shall cease to be in effect, except that:
"1. The rights and obligations of any enployee and em- • •
ployer in the industry under Sections b. c. and d, and. any and
all interpretations of said Sections b. c. and dof Article II,
which have accrued prior to the effective date of this amend-
ment, shall not in any way be affected.
9732
"2. Anj' penalty or liability tinder or arising out of
said Sections b, c. and d of Article II, Thich have accrued
prior to the effective date of this amendment, shall not
"be extinguished."
It was provided in the above Order, aside fron amendments as quoted
above, that "the firm of Lee, McClain anc n Scalzo, of Shelbyville,
Kentucky, be exempted from the provisions of this amendment until a hear-
ing has been duly held and decision rendered. " It ma.s further provided
that the amendments "shall become effective as of June 15, 1955."
B, Arguments Pavoring; Proposed Classified TJe^e Scales .
As has already been indicated, the proposal for r/riting into the
Code provisions setting up additional classified vrage scales brought about
a sharp division of o-oini^n in tfte Industry. The Code Authority as a group
favored in substance the proposed amendments, although as Has explained
above, Pages 215-217. there mere some differences of ooinion betreen the
management members and the lahor members. Opposition to the amendments
centered in the Industrial Recovery Association grouo, This group for the
most part mas opnosed to the amendments specifically and on principle.
Because of the great Mnoortance of this controversy over mages to the
Industry in general, it appears appropriate to present in more detail the
arguments advanced for and against the proposed amendments,
The arguments favoring the amendments eve best set forth in the May
10, 1935, report of Acting Division Administrator II, D. Vincent to the
National Industrial Recover Board recommencing their. adoption. The
report folloms: (*)
"MEMORANDUM May 10, 1935.
"TO: 1'ational Industrial Recovery Board
"FROM: II, D. Vincent, Acting Division Administrator
"SUBJECT; Proposed Amendments of Article II of the Code of
Pair Competition for the Men's Clothing Industry,
"At the time of the public hearing on the proposed amendments
above mentioned I mas Deputy Administrator in the Apparel
Section of the Textile Division, national Recovery Administration,
in charge of the Men's Clothing Industry Code of Pair Competi-
tion, and conducted the hearing on the proposed amendments men-
tioned, I am nailing the following report, findings and recom-
mendation because I am familiar rrith all of the facts, circum-
stances, proceedings, hearing and record relating to the proposed
amendments.
(*) Memorandum dated ; ay 10, 1935, from Acting Division Administrator
M» D, Vincent to the national Industrial Recovery Board. (Men's
Clothing Code Piles, under Amendments).
973;
-223- -
"A niblic hearing was held on the proposed amendments above
mention, February 1, 2 aid 4, 1935, in the Hall of rations of
the Wash.ir.gtoh Hotel, Washington, D.. C.
"Every person who requested an appearance was fairly heard in
accordance with the regulations of the national Recovery Admin-
istration. There were present duly authorized representatives
of the Code Authority, Research and Planning Division, Legal
Division, Industrial Advisory Board, Labor Advisor;' Board and
Consumers' Advisory Board. In addition there were present re-
presentatives of the Industrial Recovery Association of Cloth-
ing Manufacturers and the Amalgamated Clothing Workers) Union.
"At the tine of adjourning the hearing, the Deputy Administrator
at the request of parties appearing and participating granted' 1
fifteen (15) days additional tine within vrhich such parties and
any other interested parties night file written statements or
"briefs. Written statements or briefs were filed 'by Counsel for
the Industrial Recovery Association of Clothing'Manufacturers,
the Bloch Company of Cincinnati, Ohio, the Merit Clothing Manu-
facturing Company of ilayfield, Kentucky, Frank Brothers of
Lawrence, Massachusetts, the Standard Tailoring Company of
Columbus, Georgia, the Goodall Manufacturing Company of Ohio and
Tennessee, the Uniform Manufacturers, the rational Grange, the
Chanters of Commerce of Cleveland, Ohio, Lawrence, Massachusetts
and Aurora, Illinois, and Congressman Haines of Pennsylvania.
"Upon the testimony and all other evidence contained in the
record of this nearing, I find as follows;
"1. Two .amendments of Article II, containing the" wage -pro-
■visions of the Code, are proposed by the Men's Clothing In-
dustry Code Authority, One of these amendments was proposed by
the management members of the Wage Rate Committee of the Code
Authority and one "by the labor members of the Committee.
"2. The .Industrial Recovery Association of Clothing Manu-
facturers also proposed three amendments of Article Ho
"3. The amendment proposed by the management members of the
Wage Rate Committee of the Code Authority proposes classified
hourly rates which include some existing rates, establish
other and new rates, and in a few instances increase exist-
ing rates. This amendment also proposes a 'slow workers' tol-
erance of 20^ of specified classes of employees, subject to
stated minimum compensation and other conditions of employment.
"4. The amendment proposed by the labor members of the Wage
Rate Committee follows closely the classified hourly wage
rates proposed by the management members out also proposes cer-
tain new rates and increases of some existing rates.
'5. The three amendments proposed by the Industrial Recovery
Association of Clothing Manufacturers propose:
9782
-225-
"10. At the hearing, the Code Authority submitted this ' compilation
and ansl?/sis of wage data in support of its proposed amendments,
together with testimony of witnesses to market, labor and working
conditions in the Industry.
"11. The revised amencnent proposed by the Code Authority will es-
tablish some new classified v/age rates and will increase some of
the existing minima as appears from Section (.O, Subsections (1^
to (7) inclusive. Other minimum rates for men's wash suits of lOO'o
cotton and unclassified manufacturing employees are not changed.
Existing North and South differentials are not disturbed. Weekly
minima, for non-manuf ncturi lg enroloyees are not changed.
"12. The Research and Planning Division's compilation and analy-
sis show the average earnings of all employees throughout the In-
dustry for the period July to November, 1934, inclusive, to be
66.2^ per hour, which substantially exceeds the proposed new basic
minima of 50^,i55<i, and 60,^- .per hour (excluding basic minima of 4/V
per hour and underV In centralized markets and in some decen-
tralized markets the- average hourly earnings substantially exceed
'.the general average of 66.2^ per hour.
"13. The labor cost of a large section of the Industry will not
be substantially affected by the new rates proposed. A minor part
of the Industry will be affected. The object of the proposed rates
is to diminish certain existing unfair ineoualities in wages and
direct labor cost.
"14. The amendment also includes provision for employing physical-
ly and mentally handicapped workers at wage rates below the minima
but at not less than other employees receive for similar work, and
in no case for less than 70$ of the minimum wage provisions.
Such exempted persons may net number more than 5fo of the total num-
ber of employees in any plant.
"15. There is in addition a 'slow workers' provision authorizing
employment of such a class, which shall not at any time exceed 20^
of the workers on operations included in Subsections 3, 5, 6, and
7 of Section (a) of Article II. This limitation will operate to
prevent such tolerances exceeding more than a small percentage of
the total number of employees in any plant.
"16. The existing Section (b^ of Article II which maintains exist-
ing differentials between the lowest paid and the highest paid
classes up to $30.00 per week, and the supplementary Sections (c^
and (d") are eliminated, subject to a provision that the rights and
obligations of any employee and employer which have accrued under
Sections (b), (c), and (&) prior to the effective date of this
amendment shall net be affected.
"17. The Association mentioned objected to the amendments proposed
by the Code Authority and offered the testimony and statements of
9782
-226-
several witnesses to support its objection and also in behalf of
the three amendments above quoted which the Association itself
proocsed. The Association offered no representative or detailed
wage data. Its chief showing consisted of the exoert testimony
and deductions of Dr. Willford I. King, Professor of Economics in
the School of Commerce, New York University.
"Dr. King's testimony was theoretical and based uoon hyoothetical
premises. He professed no knowledge of this Industry but declared
that all Industry, including the Men's Clothing Industry, should
be free from production and cost controls bylaw or otherwise.
Freedom of production and distribution, he stated, is desirable
and in fact necessary to the widest use of resources and labor.
Such freedom with unrestricted competition, he stated, justifies
competitive freedom in labor markets. For these reasons he said
that fixed minimum wage rates whether imposed by law or by col-
lective agreement were undesirable and uneconomic. Dr. King's ob-
servations fail to take into account certain economic facts of do-
minating importance. When wage rates are not fixed by law or by
collective agreement they nevertheless rest unon a contractual
basis. If the contract is not formal it is implied. It is quite
imoossible to free Industry and labor from some form of contrac-
tual relationship. The necessary existence of such a basis for
wage rates unaviodably imposes some degree of restraint upon or
control over wage rates and direct labor cost as a factor in pro-
duction.
"there is nothing new in minimum. wage rates. Code minima rates are
distinguished from agreed minima chiefly in the fact that the law
declares certain minima rates economically indisoensable to nub-
ile and orivate security.
"Subsequent to the hearing the Association filed a statistical ana-
lysis by Dr. King of wage data compiled and analyzed by the Divi-
sion of Research and Planning. Dr. King's conclusion, briefly sta-
ted, is that the data does not support the results derived by the
Research and Planning Division. His deductions, however, depend so
largely upon presumptions and implications .that they are of little
if any nractical value.
"As an instance, Dr. King in his statistical analysis said: ' It
will be observed that the establishments having the fewer employ-
ees appear to have the larger proportion of workers receiving less
than 50^ per hour. ' He also infers that the small emoloyers are
in the decentralized areas. This is not the fact. The small fac-
tories and shops are chiefly found in the large cities. It also
appears that by far the larger number of small shops are in the
higher paid wage areas some of which are the so-called centralized
areas. The larger establishments are more widely dispersed. Nine
of the fifty larest establishments are in small towns and very few
small establishments are found in small towns. Dr. King's deduc-
tion is not in accord with these clearly-established facts.
"In six of the fifty largest establishments, excluding cutter and
off-pressers, 40.3fi, 40.6f , 41. 1$, 50.7$, 61. 5^, and80.4f
9702
-227-
respectively of the total number of employees receive only the mini-
mum of forty cents per hour. In eight other of the fifty largest
plants only" .0$, 0.7^, 1.1$, 1.1$, 1.2$, 2.5$, and 2.7^ respective-
ly of the '■jtal number of emnloyees are >aid as little as the mini-
mum of forty cents ner hour. Again seven of the fiftv largest firms
pay fror. 41. 21 to 64.5$ of their employees over seventy-five cents
oer hour, while five others of these fifty largest establishments
Day only ">.2l, 1.1$, 1.2$, 1.5$, and 2.5-1 of their employees over
seventy-five cents oer hour. It is to correct and in some degree
iron out these ineqxxalities in wages and direct labor cost that the
Industry seeks to establish the higher minima rates. Such a change
of wage rates seems essential to give security to established In-
dustry members in both the centralized and decentralized areas.
"18. These increased minimum rates will bv no means equalize exist-
ing wage di soar i ties but they will tend to measurably reduce the
unfair competitive advantages in direct labor cost now enjoyed by
some members of the Industry. Inasmuch as these rates will appre-
ciably affect only a few factories employing approximately 14$ of
the workers of the Industry, the price of clothing to the consumer
should not be affected.
"19. I have examined the statements and briefs filed bv Counsel
for the Association and by others objecting to the amendments pro-
posed by the Code Authority. These do not answer the very convinc-
ing proof offured by the Code Author it - " - in support of its amendments.
"The brief of Mr. Leonard Weinberg, Counsel for the Association, con-
tends that if the amendments are adopted 'They will make it impos-
sible or impracticable for those manufacturing under mass produc-
tion methods to continue to compete with the craft manufacturers
in the centralized markets.'
"The centralized markets, it is asserted, are Philadelphia, New
York, Chicago and lo Chester, but certain of the so-called decentra-
lized markets are equally important production centers.
"It is an interesting fact that the largest manufacturer in the In-
dustry is in a so-called decentralized market, and several other
of the largest are likewise in the decentralized fields. Equally
important is the fact that among these largest establishments in the
decentralized areas are found both the highest and the lowest ave-
rage wage rates. It is obvious that a higher degree of fair compe-
tition cannot be established or maintained until existing variations
in competitive labor costs are diminished.
"20. In proposing these ainendnents the Code Authority represents a
very large majority of large, medium sized and small manufacturers.
Of approximately 3,500 members, the protestants number less than
sixty, of whom only a few are small manufacturers.
"The Code Authority, in proposing and assenting to the amendments,
represents manufacturers in the Men's Clothing Industry producing
approximately 801 of the total production.
"21. Frotests were made by representatives of one small concern
-228-
in Shelbyville, Kentucky, moderate sized plants in Columbus, Geor-
gia, Richmond, Virginia, and four or five others in scattered mar-
kets in the Industry. They testified in general terms without sub-
mitting cast data showing a need for relief from existing wage
rates. If in exceptional instances exemptions or other forms of
relief are needed, these should be granted upon appropriate show-
ing and limited to such individual instances of need.
"I am recommending a stay of these rates for the Shelhyville, Ken-
tucky plant until a hearing can he held. . Respecting claims of a
need for relief by a few other plants mentioned, I am causing a
public hearing to be held to enable them to present proof of any
exceptional circumstances affecting their inability, if any exists,
to pay Code rates.
"22. The first of the three amendments proposed by the Associa-
tion nroTioses a deletion of all wage provisions except the mini-
mum wage. Obviously this would destroy much of the security of a
large part of this Industry. As piece-work rates are a long es-
tablished system in the Industry, classified hourly minima should
be maintained to safe-guard fairly competitive labor costs, for
it is in wage rates above the basic minimum that inequalities in
labor cost exist, and in which there is a definite tendency in
some instances to make the minimum the maximum rate.
"23. The second Association amendment pronosed is to define Worth
and South to conform 'with ecomomic, historic and geographic rea-
lities.' It is enough to say that economic and historic realities
conflict. Geographic considerations should be considered to the
extent that the demands of economic equality dictate. Provision
is made by existing differentials 'for these factors. These dif-
ferentials should be adjusted from time to time as experience and
authentic data may suggest.
"24. The third amendment proposed by the Association would delete
Article II (f) 'limiting (as the Association states' 1 the amount
of production.' This Code provision is not in any sense a limi-
tation upon or control of production. Its- purpose is to safeguard
employees against an increased task requirement to avoid or de-
feat the wage and work time benefits prescribed by the Code.
"25. Previous to the approval of the Men' s Clothing Industry Code
there had occurred during the depression years a progressive de-
cline in number of workers employed, in wage rates paid in most,
if not all, markets of the Industry, and in production. Since the
adoption of the Code and the organization of the Code Authority
these trends have been gradually reversed. The shorter work week
of 36 hours has spread employment. Code wage rates have substan-
tially increased earnings. By November, 1934, average weekly earn-
ings had increased 25$ over June, 1933. In many markets the sur-
plus skilled labor has been absorbed. The Code Authority in be-
half of the entire Indus trv, excepting tailors-to-the- trade and
manufacturers of uniforms, has recently asked for four (4") hours
overtime per week for a period of five weeks to meet market demands
for production. Only three or four important markets show a surplus
9782
-229-
of skilled labor available this current season. Uniform hours and
minimum wage rates have combined to make a substantial ■ d needed
progress toward stabilized competitive labor costs. The Industry-
is unquestionably in a much healthier state since the approval
and administration of Code controls.
"26. It is significant that management representing a very large
section of the Industry and the representatives of employees have
joined in proposing rates, some of which are increases of exist-
ing rates.
"27. I further find that:
11 (a) The amendments to the said Code and the Code as amended
are well designed to promote the policies and purposes of Title
I of the national Industrial Recovery Act including the removal
of obstructions to the free flow of interstate and foreign com-
merce which tend to diminish the amount thereof, and will provide
for the general welfare by promoting the organization of Industry
for the purpose of cooperative action of labor and management un-
der adequate governmental sanction and supervision, by eliminating
unfair competitive practices, by promoting the fullest possible
utilization of the present productive capacity of industry by avoid-
ing undue restriction of production (except as may be temporari-
ly required), by increasing the consumption of industrial and ag-
ricultural products through increasing purchasing power, by re-
ducing and relieving unemployment, by improving standards of la-
bor, and by otherwise rehabilitating industry.
"(b^ The Code as amended complies in all respects with the
pertinent provisions of said Title of said Act, including without
limitation subsection (a** of Section 3, subsection (a) of Section
7, and subsection (b) of Section 10 thereof.
"(c) The Code Authority is empowered to present the aforesaid
amendments on behalf of the Industry as a whole
"(d) The amendments and the Code as amended are not designed
to and will not permit monopolies or monopelistic practices.
"(e) The amendments and the Code as amended are not designed
to and will not eliminate or oppress small enterprises and will
not operate to discriminate against them.
"(f) Those engaged in other steps of the economic process
have not been deprived of the right to be heard prior to the ap-
proval of said amendments.
"For these reasons I recommend approval of the amendments
proposed by the Code Authority as revised, effective as of 12:01
o'clock June 15, 1935. I also recommend disapproval of the three
amendments proposed by the Industrial Recovery Association of
Clothing Manufacturers.
"M. D. Vincent
Acting Division Administrator
Textile Division"
-230-
C. ADVISERS' RECOMMENDATIONS OH PROPOSED C?IANGE IN WAGE PROVISIONS .
The aporoval of the wage amendments was strongly -urged upon the Na-
tional Industrial Recovery Board by C-ustav Peck, Special Adviser, on
May 22, 1935, in a memorandum to W A. Karriman, Administrative Officer.
Mr. Peck stated that- the inadecuacies of the Code's "II .(b)' 1 clause were
largely the fault of the Administration and that the Code Authority had
"made valiant efforts to enforce the clause without success" and that
the proposed amendment is only a substitute of definite minimums for
the "II (bV' clause. It was urged that "we shall be letting down the
industry if we do not accept definite minimums for this trade." This
adviser discouraged the postponement of action counseled by others be-
cause of impending legislative action concerning H.R.A. (*).
The Legal Division, through A. II. Barenboim, Assistant Counsel,
on -February 12, 1955, advised Deputy Administrator Vincent that the
statistics furnished by the Code Authority in support of the amendments,
"if left undisputed and uncontradicted, make it mandatory that the Ad-
ministration approve the amendments in substantially the form as sub-
mitted. .... It is my honest belief that at least a good prima facie
case was presented by proponents." (**).
The Consumers' Advisory Board on Anril 25, 1935, advised Deputy Ad-
ministrator B. E. Oppenheim with respect to the proposed wage amend-
ments that no action should be taken "at the present time." Attention
is directed to the April 18, 1935, minutes of the National Industrial
Recovery Board "to the effect that amendments of Codes should be defer-
red until after the enactment of new N.R.A. legislation by the Con-
gress, unless special circumstances require immediate action in the pub-
lic interest." The Consumers' Advisory Board indicated that further stu-
dy of the amendments would be made, and made no definite recommendation
other than indicated above. (***).
The Research and Planning Division, relative to the proposed wage
(*) Memorandum dated May 22, 1935, from Gustav Peck, Special Advi-
ser, to ',7. A. Harriman, Administrative Officer, Code Records,
Men's Clothing Files, under Amendments.
(**) Memorandum of February 12, 1935, from A. H. Barenboim, Legal Di-
vision, to M. D. Vincent, Deputy Administrator. (Men's Clo-
thing Code Files, under Amendments — 17age Provisions, Deputy's
Cony Volumes I and II.)
(***0 Memorandum dated April 25, 1935, from Raymond Kenny, Consumers'
Advisory Board, to Deputy Administrator B. E. Oppenheim, (Men's
Clothing Code Files, under Amendments'! .
9782
-231-
araendments, advised on Kay 2, 1935: (*V
"The Research and Planning Division is of the opinion that the time
is not propitious for amending the Men's Clothing Code setting up many
additional wage mimmums in line with the proposed order submitted for
consideration under date of Aoril 9, 1935. Inasmuch as the N.R.A. is at
nresent the subject of legislative and judicial survey which may result
in changes in administrative policies it would aopear unwise to bring
about far-reaching changes in the lien's Clothing Industry which may
■Drove to be only temporary.
"The setting up by codes of complex classified wage scales has been
contrary to established policy of both the N.I.R.B. and the Research and
Flanning Division, although there are exceotions. It appears to have
been recognized that the establishment of classified wage scales is a
matter too difficult and complex, carrying the danger of handicapoing
industry by inflexible machinery, to be provided for and administered
through codes. This assertion of present policy is in no sense a denial
of the fact that in \,he Lien's Clothing Industry unfair competition does
exist with respect to wages above the basic minimums.
"In time, with clarification of U.S.A. policy, if it should be found
desirable to amend the Men's Clothing Code respecting wages of the high-
er paid classes, the Research and Flanning Division suggests that con-
sideration be given to the possibility of allowing members of the indus-
try option as "between classified wage scales as proposed and a weighted
average wage rate somewhat below the industry average, applicable to se-
parate plants. This suggestion is made in view of the fact that a sub-
stantial minority group in the industry insists that dissimilar proces-
ses of manufacture employed in the industry make impossible, without un-
due hardship, the inroosition of classified wage scales applicable to the
entire industry."
No action was taken by the National Industrial Recovery Board upon
the proposed Order regarding wages. A memorandum of L. C. Marshall, Exe-
cutive Secretary of the N.I.R.B. . to W. A. Harriman, Administrative Of-
.ficer, on May 28, 1935, states: "In view of the recent court decision,
I am returning the file of material in connection with the above men-
tioned subject." (**).
D. ADDITIONAL ARGUMENTS OPPOSING PROPOSED CLASSIFIED WAGE SCALES .
It should be recorded that the files .of the Men's Clothing Industry
Memorandum dated May 2, 1935, from J. ".'. Hathcock, Research and
Planning Division, to Walter E. Woodford, Jr., Assistant Deputy
Administrator. (Men's Clothing Code Files, under Amendments).
(**) Memorandum dated May 28, 1935, from L. C. Marshall, Executive Sec-
retary, N.I.R.B., to V7. A. Harriman, Administrative Officer.
(Men's Clothing Code Files, under Amendments. ^
9782.
Code contain over a hundred letters of objection to tlie proposed classi-
fied wage rates. Host of these protests are from Chamber's of Commerce,
Senators, Congressmen, and almost without exception pretest in general
terms that the proposed amendments will place small plants in the de-
centralized areas at a disadvantage with respect to plants in large
cities. The following protests appear to he outstrnding and hence are
presented in some detail.
Governor Eugene Talmadge of Georgia wired the N.R.A. " on February 2,
1935, that "The Chamber of Commerce of Columbus, Georgia, is strenuously
opposing the proposed amendment to the Lien' s Clothing Code which would
have the effect of putting small clothing manufacturers in the South
out of business. Will appreciate it if you will see that there is no
discrimination against the small clothing manufacturers of Georgia and
other Southern states. "(*)
On December 29-, 1934, John E. Edgerton, President of the Southern
States Industrial Council, commented that the proposed amendments "have
in them a serious threat tc the Southern elements of that industry,
due to the radical differences in the conditions of life which govern
that industry" ... .Postponement of the hearing is asked until sufficient
time for the Southern part of the industry "to gather the necessary
factual information, and prepare their case." (**)
General R. E. 'food, President of Sears-Roebuck Company, Chicago,
Illinois, wrote Deputy Administrator 1,1. D. Vincent on February 1, 1935,
stating:
"We feel that the proposed change? in the "..en's Cloth-
ing Code are of such vital importance tc the general
policy of the K.R.A. that no decision should be rea.ch.ed
until general policies are decided. We feel that the
proposed amendments tend to centralize Industry and
throw it into large cities and will ruin the smaller
manuf a.cturers in smaller towns and cities. We feel
that this will tend to defeat decentralization of in-
dustry. 1 ^***)
(*) Telegram elated February 2, 1935, to N.H.A. from Governor
Eugene Talmadge, of Georgia. (hen's Clothing Code Files,
under Amendments, Protests.)
(**) Letter dated December 29, 1935, to Clay lilliams,
Chairman, N.I.R.B. , from John E. Edgerton, Southern
States Industrial Council, (hen's Clothing Code Files,
under Amendments — Protests. )
(***) Letter dated February 1, 1935, from General R. E. Wood,
President, 3 ears- Roebuck Company, to 1,1. D. Vincent,
Deputy Administrator. (Men's Clothing Code Files, un-
der Amendments. )
9782
-233-
A protest filed by The Fechheimer Bros. Cc . , of Cincinnati, Ohio,
is ;f interest in that an alternative proposition is suggested, namely:
"...we would favor (in order that all manufacturers whether employing
union Dr non-union help be placed upon the same basis of manufacturing
costs) a. fixed and established rate for piece work upon a scale of
wages per operation whether performed by male or female, or skilled
or unskilled operatives." (*)
Objection filed by the Merit Clothing Cc . , Inc., of Llayfield,
Kentucky, on February 21, 1935, struck a similar note in stating:
"TJhat you want, is a higher minimum wage, while what
we want and what we feel that in justice we are en-
titled to is that in determining this minimum, how-
ever high or low, it shall be expressed in terms of
piece work or production rather than a stipulated
hourly rate regardless of the production," (**)
LIr. "J. D. 3. Dodson, 3x. Vice President of the Portland, Oregon,
Chamber of Commerce, indicated a fear tiiat the proposed wage amend-
ments would injure the small manufacturer located away from metropoli-
tan areas. In arguing "the case of the small manufacturers" he
asserts: (***)
"Among our advantages may be listed the following:
"1. Lower living costs for the labor as compared with
great industrial centers.
"2. Less turmoil and destructive interference with
operations.
"3. Reasonable proximity to the raw material supplies
from which cloth is made and also a near situa-
ticn to cloth manufacturing mills of our western .
territory.
"-1. A willingness of labor because of these lower
living costs and better living conditions to
accept a lower wage than is possible for him
to accept in the larger and most costly living
centers.
(*) Letter dated January 9, 1935, from The Fechheimer Pros. Co.,
Cincinnati, Ohio, to Acting Assistant Deputy Administrator
S. P.. Curbacker. (lien's Clothing Code Piles, under Amendments.)
(**) Letter dated February 21, 1935, tc Deputy Administrator
LI. D. Vincent, from the P.erit Clothing Co., llayfield, ICy.
(hen's Clothing Code Piles, under Amendments — General Corres-
pondence. )
(***) Letter dated February 4, 1935, from tir. J.B.D. Dodson, Execu-
tive Vice President of the r:rtland, Ore., Chamber of Commerce,
to Li. D. Vincent, Deputy Administrator. (..on 1 ? Clothing Code
Piles, under Amendments, Protests.)
9732
-234-
"Gur disadvantages may be listed as follows:
"1. Distance from the larger labor centers wliere the
most efficient and trained help is found.
"2. Transportation costs in finding a market for a
majority of the products made by cur smaller
operators in the distant locations.
"3. Increased selling costs forced upon our opera-
tors through the necessity of having salesmen .
make long journeys to seel: the buying centers.
"4. Lack of immediate touch with the centers where
new patterns and styles are created, with greater
delay in getting informa.tion as to these styles
and patterns and the inability to manuf acture
clothing ahead of the establishment of such
styles and patterns.
"....Because of the terrific massing cf production in
a few centers where there is no opportunity for labor
to acquire land, ^oy means of whicL. he can aid in his
living costs, and due to the high rents and prices of
property in these mass centers and because of the tre-
mendous relief problems now faced in such centers by
the na.tion and the states, the deliberate policy is
being fostered of trying to decentralize in a modest,
progressive and economic way certain industrial opera-
tions. Included in such operations we may very proper-
ly cite the lien' s and Boys' Clothing Industry.
"This decentralization can be made gradual and will be
for the benefit of the workers and society. An in-
creasing percentage of these workers through subsist-
ence homestead movements may be encouraged to acquire
small acreages of producing land. This would pat
them on a safer and sounder footing for society a.s a.
whole.
"As a general argument we would also ask you to con-
sider the national aspects of the economic situation.
If codes undertake to force conditions whereby the
great ma,ss centers may be permanently protected in
their present unhealthy development, k._ere will be no
chance whatever for the development of industry out-
side of such centers. There v/ill be no opportunity
whatever for the great producing regions of the na.-
tion outside of these artifically developed mass
centers to errand in t.ieir industrial life. There
will be no opportunity under such a program to bal-
ance the productive business of the nation, to get
it on e. more healthy basis, to avoid the excessive
9782
-235-
ccsts of shipping the food and materials required by
labor long distances at great charge and otherwise
attain what we term a wholesome, more economical order."
V. APPRENTICES
The Men' s Clothing Code as originally approved carried no provi-
sions respecting apprentices. It soon developed, however, that the
areas particularly affected ay the prohibition of home work desired a
learner provision for a definite period so that the home work problem
could be met without injury. After considerable controversy within the
Code Authority it was finally agreed that learners could be employed
at rates 70 percent of the mini .xuu fcr a period of three months from
December 11, 1933. The Code ?/as so amended on December 15, 1933.
From the outset, as above indicated (see page 214), the decentralized
areas of the Industry had wished a learner provision in the Code.
P.. is learner problem became somewhat involved after the issuance
of Executive Order No. 6750 C, dated June 27, 1934, which gave the
Secretary of Labor authority to introduce apprentices to all industries
irrespective of Code provisions. The Hen's Clothing Code Authority
urged the Secretary of Labor to provide for no system of apprentices
in the hen' s Clothing Industry until all available skilled workers had
been reemployed. (*) Shortly thereafter the Code Authority made arrange-
ments with the Department of Labor whereby all applications for
apprentices were to be submitted to the Code Authority for recommenda-
tion.
On February 11, 1936, the Federal Committee on Apprentice Training
advised that no apprentices were indentured in the lien' s Clothing In-
dustry, and therefore n^ Apprentice Exemption Certificates were granted
to members of that Industry. (**)
Three requests for apprentices which cane to the attention of the
Administration were referred to the Code Authority. Their final dis-
position is not known. Code records disclose one Order, ho. 15-53,
(*) Report of Executive Director of the hen's Clothing Code
Authority, dated September 14, 1934. (hen 1 s Clothing
Code Files. )
(**) Letter of February 11, 1936, from Mary Curran, Secretary
to Wm. F. Patterson, Executive Secretary, Federal Com-
mittee on Apprentice Training, to J. ".7. hathcock, Assist-
ant Unit Chief, Textile Unit, Division of Review, LT.R.A.
(hen's Clothing Code Files.)
9782
-236-
dated Janua.ry 12, 1935, denying an application of Prosterman-
Spiesberger Company, Chicago, Illinois, to employ apprentices at less
than Cede rates. The firm claimed that a shortage of skilled workers
existed at the Company' s plant in Jacksonville, Illinois. The denial
of the Company' s request was based on an investigation by certain
Code Authority members, who reported a supply of skilled labor avail-
able in Chicago and who advised that another company in Jacksonville
had not made a similar request.
VI. HOME "JOHKERS AND IIANDI CAPPED WORKERS .
As indicated en page 214, this chapter, the Code for the Lien's
Clothing Industry v/ as amended to allow handicapped workers employment
under certain special conditions. The President, by Executive Order
No. 6606 P, dated February 17, 1934, made provisions whereby workers
in all industries falling in this category should be allowed exemp-
tion from usual codal wage provisions, subject to the Department of
Labor regulations.
For all industries, 17,203 handicapped workers certificates
were issued under the Executive Order. Twenty-three Codes accounted
for not less than 14,245 certificates. Of these Codes, Men's Cloth-
ing held third place, following Cotton Garment and Canning. The
Lien' s Clothing Code accounted for 370 certificates issued, 458 appli-
cations refused, 5 certificates revoked, and 24 certificates can-
celled. Table XLVIII on page 237 indicates the distribution of the
above data by States. (*)
A provision similar to that described above for handicapped
workers was made possible for home workers by Executive Order No. 6711
A, dated May 15, 1934. Of a total of 2,603 certificates for home
work granted, only 16 are accounted for by the Men' s Clothing Indus-
try, which was generally recognized prior to the Code as the largest
industrial home work industry. The following Table indicates the dis-
tribution of applications and certificates granted by States:
(*) United States Department of Labor, Division of Labor Standards,
Exceptions to Wage Provisions of N.R.A. Codes in Cases of
r.andi capped 'Jo rke r s (Mimeographed Bulletin No. 244,
December 9, 1935. )
9782
-237-
TA3LE XLVIII
NUMBEH CP HANDICAPPED iTOHKEHS CERTIFICATES ISSUED, REFUSED,
REVOKED, AND CANCELLED TO AND INCLUDING MAY 37, 1935,
ACCORDING TO CODS AND STATE REPORTING (*)
CERTIFI-
APPLI-
CEETIFI-
CERTIFI-
CATES
CATIONS
L/.M.J. JLO
CATES
ISSUED
EFFUSED
REVOKED
CANCELLED
Totals
870
458
24
Colorado
9
Illinois
140
125
Indiana
65
Iowa
14
21
Kentucky
1
Louisiana
9
Maryland
78
11
Mas s aclius e 1 1 s
12
1
Minnesota
6
Missouri
4
2
2
New Hampshire
2
Few Jersey
35
12
New York
204
209
Oiiio
154
24
1
Pennsylvania
127
52
1
Rhode Island
1
Tennessee
11
"icconsin
2
.1
12
2
1
1
(*) U. S. Department of Labor, Division of Labor Standards,
Exceptions to Wage Provisions of IT. R.A. Codes in Cases
of Handicapped Workers (Mimeographed Bulletin No. 244,
December 9, 1935.)
9782
-238-
TABLE XLIX
SPECIAL CERTIFICATES OF EXCBxTIGITS TO HOMEWORK PROHIBITIONS
OF THE CODES l/
ifflJ'S CLOTHING*
Certificates Applications
Issued Refused
Totals 16 27
Maryland 2
Hew Jersey 5 6
Hew York 4 19
Pennsylvania 5 2
(*) Ho certificates were revoked for violations of provisions of
certificates; three certificates were cancelled in the State
of Pennsylvania because they were no longer needed.
l/ United States Department of Labor, Division of Labor Standards,
Exceptions to the Industrial Homo VJork Prohibitions of H.R.A.
Codes (Mimeographed Bulletin Ho. 243, December 9, 1935).
-239-
VII. EEUPTIOI ?2C ;. r AC-S PHOVISI01TS.
As has been indicated already, the Code Authority tool: the
position consistent 1 .;: that it had no power to make exemptions to the
CoJ.e and that it vac disposed to discourage the granting of exemp-
tions by the Administration. The Code Authority, however, approved
Order ITo. 15-11, dated April 27, 1934, which save certain exemptions
to Puerto P.ican manufacturers. As explained in our discussion of
hours exemptions, the Puerto Eican manufacturers shipping to
the Continental United States were allored 40 hours per reek, Addi-
tionally, these firms were allowed to pay employees 50 per cent of
the minimum rages mrovided for the northern area of the Industry.
The Administration supported the Code Authority in its position
that the wage provisions of the Code he maintained without exception.
iJo emempt-ions re re granted hy the Administration from the codal rage
provisions except in the case of Puerto Pico. Considerable pressure
ras brought upon both the Code Authority and the Administration for
a general relaxation of Code minimum rages, in the form of apprentice-
ship provisions, but with the exception of the three-month exemption
to the entire Industry, discussed, on page 214 of this chapter, no
exemptions "ere allowed.
VIII COiZPLIAITCS
Attention is called at the outset to the special investigation
of Code enforcement activities made by Deputy Administrator i . D.
Vincent, covering the period up to August 30, 1934, the date of the
report. This report is available in the i en's Clothing Code files
and is described in the September 9, 1934, report of the Executive
Director of the Code Authority as follows:
"ilr. Pobert Straus, Special Assistant to General Johnson,
was ashed to make a special investigation of the entire
enforcer lent activities of our Code Authority uit to date,
and, chiefly, to study the records of actions of both
staff and the II-D Committee in the application of II-B.
hr. P. P. Vincent, one of the ablest Deputy Administra-
tors in the Apparel Section, was delegated by Lir. Straus
said hajor G-itchell to make this investigation. L'r. Vincent
spent several days going through our files and reading
the records of the headings held before the II-D Committee.
He placed special emphasis in his investigation on every
detailed subject in connection rith the G-reif case. On
August 30, (.1334) he made his report, a copy of -hich has
been r.ade available to us. His conclusions are most flat-
tering in that he finds that '-e have covered all of the
important markets in the country in our investigations
thoroughly and impartially, and that in the application
of all the provisions of the Code there has been no dis-
crimination betreen markets or betreen individual firms.
In fact, his only adverse comment was that re rere pro-
bably too strict in the rording of some of our letters
to aJ-leged violators of the Code. This thorough-going
3782
-240-
report should "be the final answer to the charges and
rumors that you are all familiar with to the effect
that the Code Authority has discriminated against certain
sections and Members of the Industry."
The investigation of the enforcement methods of the Code Author-
ity "by Deputy Administrator , . D. Vincent was the outgrowth of a com-
plaint handled "by the Ken "for... State Compliance Office, originated "by
Rartin E. Popkin, Executive Director of the Industrial Recovery Asso-
ciation of Clothing Lanufacturers, who, under date of Ray 23, 1934,
wrote "complaining that the Code Authority nas partisan and using its
power to discriminate against members of his Association." hr. Popkin
charged "that Article II (b) was being enforced by the Code Authority
against members of his Association and not against members of the
Clothing Manufacturers Association of the United States, which Asso-
ciation had a collective agreement with the Amalgamated Union."
Rrs. Anna R. Rosenberg, ilew York State Complaince Director, dis-
cussed this complaint with ]':.■:. Robert R. Straus, Special Assistant to
the Administrator, and thereafter Rr. Howard, a sijecial agent, was
assigned to make an investigation. L'r. Horard spent some time on the
investigation and upon reporting that he was not receiving the coopera-
tion he expected from the Code Authority, was superseded ^oy Deputy
Administrator Gitchell, who tool; charge of the matter. , , (Subse-
quently, Rr. Vincent was assigned to make the investigation, and he
reported thereupon to Sol A. Rosenblat, Division Administrator, on
August 30, 1934. (*)
Rr. Vincent's report came to the attention of the Industrial
Recovery Association around the first of February, 1935, during the
course oi the public hearings on the proposed wage amendments. The
report '-as severely criticized upon both the scope of the investigation
and the findings. (**)
The records of the Washington Compliance -Office throw some light
upon the extent of complaints of Code violations and the manner of their
disposition. For the period from September 15, 1934, to January 19,1935,
(*) Memorandum dated Ray 6, 1935, from Mrs. Anna R. Rosenberg,
ITew York State Compliance Director, to L. R. C. Smith,
k.R.A. Legal Division. (Ren's Clothing Code Files, under
(Code Authority Complaints).
(**) Pamphlet dated February' 11, 1935, entitled Re:
Proposed Amendments to Code of Pair Competition for
the lien's Clothing Industry with Special Reference
to The Secret Report. (Ren's Clothing Code Piles.)
9782
-241-
ve find on hand and docketed (allotting for bookkeeping rejections) 779
labor complaints and 157 trade practice complaints. Of the labor con-
plaints, 520 vere adjusted, and in 68 cases no violation vas fotind,
leaving 191 on hand, of viiic'.i 23 had been referred to the Compliance
Division.
The Stield Office Report Summary of the Compliance Division, cover-
in- the period from June 16, 1934 to February 2, 1935, covers relative-
'ev cases (101 labor complaints and 8 trade practice complaints)
and is for that reason of little value in measuring compliance in this
Industry, but for the very reason of the small number of cases reported
it might be assumed that the Code Authority has been particularly
aggressive in policing the Industry. In this 80-per-cent-unicnized
Industry, with labor representation on the Code Authority, it is not
surprising to discover that most complaints of violations found their
■- - directly tc' the' Code Authority.
In the general enforcement procedure of the Code Authority chief
reliance was placed upon the payroll and productions reports of members
of the Industry. These reports are sampled to determine the extent of
observance or non-observance. Also, general investigations r:ere made
throughout the various industry areas. Upon the discovery of a wage viola-
tion, the extent of the violation vas tabulated and a bill sent to the
violator, and restitution vas ashed. If the violation v;as acknowledged
and the bill paid, the sun in cuestion vas paid by the Code Authority
to the employee or employees. If the bill vas disputed, the Industry
member was requested to appear before the Committee provided in
Article II (d) to present his case. TTnen the member did not appear or
if an adjustment could not be made after appearance, the member vas
cited to the Compliance Division. Occasionally, arbitration of a case
vas arranged, to which an Administration official or Division vas a
party as veil rs the Industry member and the Code Authority. (See
pages 156 - 160 • Chapter IV, regarding Compliance Procedure.)
At the outset, the Code Authority divided the country into five
districts vith a chief investigator in charge of each district. It
vas later found expedient to route all natters of investigation through
the central office. Provision vas made, hovever, for hearing cases in
cities o\-.tside of Ken York. Certain Boston Industry members in par-
ticular vere met in Boston upon their request.
The Code Authority in certain instances arranged for having ac-
countants visit shops, especially in ITev York, and assist in estab-
lishing a s3 r stem of keening production and payroll records which vere
essential to enforcement purposes. Also, Code Authority officials
met with large groups of Industry members and instructed them in
methods of keeping records. (*)
(*) September 20, 1934, Report of Executive Director of the
hen's Clothing Code Authority, (lien's Clothing Code Piles).
)702
-242-
The compliance officials of the Code Authority soon discovered, as
r,'as expected, tliat the greatest number of Code violations had to do with
wages. Likewise, they discovered that "the most serious problem facing us
in connection with the violation of the wage provisions of the Code, has
to do with Clause II (b) (wages of the most skilled groups." The Com-
pliance Committee explained the nature of their difficulty in a measure
as follows: (*)
"In the first place, the securing of facts upon which to base
the application of II (b) is not always an easy task and requires
the attention of a man more or loss skilled in piece rate fixing
within this industry. Even when the facts are determined the
application of the clause frequently presents an even more difficult
problem Time is of the essence in this connection, because
it obviously would be impractical to consider making adjustments in
the fall season of 1934, that would relate back to conditions ex-
isting in July, 193,3."
The full measure of the difficulty which the Code Authority anti-
cipated early in its experience and realised ever since in the attempts
to enforce Article II (b), can be best appreciated, doubtless, by a
close examination of the interpretation and formula by which this pro-
vision was administered. Let us recall that Article II (b) reads as
follows:
"The existing amounts by which the wages in the higher-paid
classes, up to classes of employees receiving $30.00 per week, ex-
ceed wages in the lowest-paid substantial classes shall be main-
tained. "
The Code Authority (See Chapter IV, under Section Interpretations
and Interpretation Procedure". ) interpreted the words "substantial classes"
as used in II (b) to include 20 per cent of the total number of emplojrees
in any establishment, this interpretation to become effective with the first
payroll following November 20, 1933. Along with the interpretation, the
Code Authority drew up for both the Northern and Southern areas an illus-
tration of the way in which it was to be applied. The illustration of the
way in which the interpretation was to be applied is found on pages 181 - 133
Chapter IV, under Section "Interpretations and Interpretation Procedure."
As early as March, 1934, Mr. Sidney Hillman informed the Code Author-
ity in meeting that the Administration was whole-heartedly behind them
in the enforcement program and that in his judgment enforcement of II (b)
in the method provided was fair. He warned the Authority, however, that
if industry did not respond to the methods provided for increasing the
wages of the classes of workers above the minimum that he would ask for
an amendment to the Code to provide for classification, although, as
explained, he personally was opposed to classification because the rule
would then be too strict. He concluded by saying that if the Code Authority
(*) March 2, 1934, Report of Committee on Compliance and Enforcement
of the Men's Clothing Code Authority. (Men's Clothing Code Piles.)
9782
-243-
were a bit more liberal in hiring the right kind of investigators the pro-
blem of II (b) would be solved.
Mr. Hillman's implied fears and warning were indeed prophetic, judg-
ing from the final resolution of the Code Authority to present amendments
to the Code providing for additional classifications of labor and wage
minima. (See page 21 5 , this Chapter.)
Although complete figures are not available respecting the number
and types of violations of codal provisions, the records do disclose the
amounts of money assessed and collected against violations. On the dates
February 27, 1935, and March 1, 1935, the Executive Director of the Code
Authority supplied the following information to Assistant Deputy Adminis-
trator "alter E. Woodford, Jr.: (*)
"Out of the total of $9S,715 collected from all sources
approximately $35,400 was collected on II (b) adjustments. (G-reif
payment of $25,000 is included in these totals.)" "the amount re-
maining due on these unpaid installments is $13,419.93, making
a total amount of money collected and. assessed $104,134.93."
In connection with giving the above information, it was explained
that in addition to cash payments <*f back pay, there were in many cases
increases in piece rates and labor costs for the future. Typical of this
was mentioned the Curlee case, "where the adjustment was effected by the
firm mailing general percentage increases to all workers by an amount more
than sufficient to put them in compliance with II (b)." It was added that
"out of a total of 33 II (b) charges marked dismissed for the Industry as
a whole, there was a reasonable number of cases which were settled on the
same basis as the Curlee case, namely, by an increase in cost, but without
cash payment. "
A summary of the handling of certain specific wage violation cases
under the Code will add somewhat to the explanation of the Code Authority
manner of enforcement, will indicate more fully the difficulties encount-
ered and will show the nature of Administration cooperation.
(*) Letter dated March 1, 1935, Morris Greenberg, Executive Director,
Men's Clothing Code Authority, to Halter S. '.Toodford, Jr., Assis-
tant Deputy ■Administrator. (Men's Clothing Code Files.)
9782
-244-
Ac The Gr^if Case ,
The Lv Greif & Ire Company of Baltimore; Maryland, was investiga-
ted by the Code Authority.- An analysis of the investigation revealed
non-eoimliance with Article II (b), and on April 24. 1934, the Company
was billed for bad: wages amounting to $35 5,785,. 91. The Code Authority
could not get the Greif Company tc appear before the II (d) Committee.
The Company demanded assurance that its right to challenge the validity
of the Code Authority's action or to challenge the constitutionality of
the H.I.R.A., would not be waived,. Such assurance, the Code Authority
did not assume power to give* The case was cited to the Compliance
Council of the Comdip.nce Division in Tashington, and was heard July 5,
1934.(*)
The Compliance Council voted unanimously to give the Greif Co. two
weeks' grace,, during which time it might contact the Code Authority and
the Deputy Administrator and he heard on its claim that the interpreta-
tion of Article II (b) had been a.olied against it in a discriminatory
manner. It was further agreed that if the Code Authority end the Deputy
Administrator made no recommendation to the contrary and if the respon-
dent had not agreed within two weeks to make full restitution of back
wages that the Compliance Council would recommend removal of the "Hue
Eagle and withholding of JJoR„A;, labels, and would refer the case to
the Litigation Division.,. (**).
The Greif Company brought suit in the Federal Court at Baltimore
to stop action of the 1T.R.A. in ordering the Cede Authority to cease
issuing labels to the Company. In the meanwhile r the Department of
Justice suggested an investigation by the Research and Planning Divi-
sion. At the outset, the Research and Planning Division was concerned,
solely as a fact-finding agency.. Later, as will be shown below, offi-
cials of the Administration became involved in the case as arbitrators.
The investigation was conducted by Mr. Prank Taggart, Research and Plan-
ning Division, and Dewuty Administrator Morris Greenberg, under the dir-
ection of Mr. Leon Henderson, Director of Research and Planning. The
part placed by the Administration can best be presented by the follow-
ing resume of the proceedings by an official who was narty to the in-
vestigations,! (***)
(*) Minutes, of Compliance. Council, Jul-' 11, 1934 9 Memorandum from John
Hopper, Executive Assistant, to Sol A. Rosenblatt, Division Admin-
istrator. (Men's Clothing Code Piles.)
(**) Minutes of Compliance Council, July 11, 1934. Memornadum, John Uopper
Executive Assistant, to Sol A, Rosenblatt, Division Administrator,
(Men's Clothing Code Piles.)
(***) Memornadum dated March 8, 1935, from H, P. Taggart to Leon Henderson.
(Men's Clothing "Code Piles, under Heo.rings, Senate Pinance Committee.)
9782
9762
-245^
"This is a resume; of the activities of the Research ■
and Planning Division,' with the technical assistance
of their Deputy Administrator Greenberg, in the Greif
case.
•"At out August 1, 1934, Greif had been found in viola-
tion of Section. II (b) of the Hen' s' Clothing Code by
the 'Code Authority and the Conpliance Division had
upheld the findings. Greif had also gone into the'
Federal Court in Baltimore arid obtained a temporary
' injunction, seeking thereby to retain the Blue Eagle
! and their* stock' of labels. Hearing on a permanent, in-
junction was pending. In order to avoid further liti-
gation the suggestion was made by yourself (lieon Hen-
dreson) to see (l) whether the Code Authority's 'ampli-
cation of II (b),had been properly made and (2) whe-
'ther there were any circumstances which should modify
the application.. Grief claimed .(l) that the interpre-
tation" and application of II (b)werc both discrimina-
tory and illogical and (2) that their operating" • carats'
and conditions were such that .the application proposed
was unfair.
"The commission wrs undertaken as a purely fact find-
ing^ job,, •. The Greif records were made available and we
determined their costs with what seemed" to lie substan-
tial exactness. TTe obtained competitive garments and
figures indicated their costs, also. Our findings
were (l) that Greif had not complied with Section II
(b) and (2) that their costs, while substantially* high-
er than they were pro-code, -'ere, nevertheless, decidedly
'lower than those their nearest competitors. They should,
therefore, be expected to make a real effort to comply
with Section II ~(b>, a thing which they had not 'done -at
all.
"These findings were made .some time in the latter part
cf August. When they were reported to Greif and the At-
torneys for both sides, Greif seemed willing to accept
them and to take some action to comply. They were un-
willing, however, to accede to the award arid 'the proced-
ure of the Code Authority. The Code Authority in turn
would be willing to accept some-, compromise if the principle
' of Section II (b) were upheld, naturally we -'ere asked
to suggest the remedy. Thus you were put in the position
of mediator or arbitrator and the second phase of our con-
nection with the case began.
"Cur proposal consisted of three parts: (l) that Greif
abandon its time work and bonus' "system of. pay and adopt
a piece-work system; (2) that the piece-work cost of
Greif 's basic garments.be set at a figure which- would be
more nearly in line with their competitors, and (3) that
pay restoration to employees be on the basis of a recoiw
putation of their wages on the ne^ piece rates rather
-246-
than by the scheme proposed "by the Code Authority. These
suggestions were accented in principle, but the manner of
setting the piece rates, the level of basic costs, and the
degree of pay restoration had to be settled by negotiations.
"Agreements on the points were arrived at as follows: (l)
Piece rates were to be established by joint efforts of
Greif and ourselves, we making the original proposals and
having the final say; (2) basic costs were to be approxi.-
mately 7% higher than the post-Code costs as determined by
our findings; (3) nay recomputation was to date back to
approximately June 9, 1934.
"These matters were settled on Augist 31, 1934, In about
a week we made our ^irst proposals of piece rates, but it
was not until October 15th, that final agreement was reached
as to the piece rates for the eight plants included in the
Code Authority's original bill. Rates for the other two
plants were set even later. As the rat^s were set computa-
tions were made of the earnings which all employees would
have made since June 9th, if the niece rates had been in
effect as of that date. These computations were audited by
Messrs e Chavin and Ollis* From the ea^nina-s which would
have been made deducted the wages actually paid in each
case. Any excess of the computed wage over the actual
wage was to be paid to the employees in question. The
total amount of such -oayment was $24,699 41 , The payment
of the individual amounts was audited ^ by Mr. 511is,
This part of the i^ork being completed on December 13, 1934.
His report indicates that he examined receipts from all but
three of the employees entitled to share in th-^ distribu-
tion. Of these three one had died and two could not be
located.
"Full records of the case are in possession of the Cost
Accounting Unit or are in your files. The Code Authority
has been furnished with the piece rates and the names of
th= operations. Greif gave us complete specifications
for each operation as well, but these specifications were
not, by agreement with greif, transmitted to the Code
Authority.
"Neither has the Code Authority been furnished any cost
information except that basic costs decided upon in the
agreement of August 31, 1934, and the same basic costs
as worked out in piece rates. Neither names or recipi-
ents nor amounts of pay adjustments have been disclosed
to the Code Authority.
"We are informed by Greif s representatives that the
new piece rate system is working satisfactorily at the
present time, with minor exceptions. Apparently, a
very few of the hundreds of individual rates set are
not quite what we hoped for, but the company has made
no application to change them.
9782
-247-
"The Compliance Division received one complaint from
■a Greif employee who evidently did not understand why
some employees received a substantial pay adjustment
others got nothing. This remployee also complained that
the Company was driving those who were unable to earn
the- minimum under the piece rates. This is probable.
However, from all information in our possession, we
have no reason to believe that the settlement has not
worked out substantially as expected."
The Executive Director of the Code Authority, 'in reporting
the settlement of the Greif case to the Code Authority, asked to be
excused from reading the text of the agreement, as it had been arranged
that the terms of the agreement were to be withheld from the public.
He further explained that the settlement of the case compensated the
employees as reauired by the codel provisions and other II (b) cases
need have no other basis of settlement.^*)
B. The Cincinnati Cases.
The Cincinnati cases are worthy of considerable attention if a full
understanding of the difficulties attending the enforcement of II (b) is
desired. Here again, as in the case of the G-reif Company, we find an
active part played by officials of the National Recovery Administration.
The philosophy underlying the proposed settlement "in maps" of the Cin-
cinnati cases is an excellent commentary upon the aims of both the Code
Authority and the Administration, and the means employed under codal^
provisions to attain their desired ends. Also a resume of the handling
of these cases reflects the attitudes and lines of defense of the re-
spondents. Following is a resume of the Administration's part in the
handling of the Cincinnati compliance cases: (**)
"A hearing- was held on October 12, 1934, lefore the Compliance
Council, in respect to Five Men's Clothing Manufacturers, all
of Cincinnati, Ohio, for violation of Article II, Section (b)
of the Men's Clothing Code. Following are the five firms in-
volved, namely:
1. P. H. Davis Company
2. Levine Brothers, Inc.
3. H. A. Seinsheimer Company
4. Storrs Schaeffer Company
5. Silverstein and Sons Company
(*) Minutes of Meeting of the Code Authority, dated September 14, 1934.
(**) Memorandum dated March 22, 1935, from Edward Chavin, Research and P
Planning Division, to R. H. Lansburgh, Associate Director, Research
and Planning Division. (Men's Clothing Code Files, under Compliance.)
9782
-248-
"As a r°sult of this hiring an agreement was entered into
on October 19, 1934, a copy of which is herewith appended.
"The above five firms all sie-ned the agreement and Mr,
F. C. Williams, Attorney of the Law Firm of Feck, Schaefer
and Williams, of Cincinnati, representing these five firms,
signed for the following additional seven firms who were
to be included in the aforesaid agreement, namely:
6. Herbert Tailoring Company
7. Schwartz Tailoring Company
8. Valerio and Company
9. Hamilton Tailoring Company
10. Ohio Tailoring Company
11. I. and S. Bing Company
12. Superior Tailoring Company
"The seven firms, six to twelve, inclusive, were included
in the picture because of the fact that Mr. F. C. Williams
represented them all, and while they were not cited for
violation of Article II, Section (b) of the Men's Clothing-
Code, were in the process of investigation.
"Upon examination of all available papers in the files of
the Compliance Council it was found that no deficiencies
were entered against the Herbert Tailoring Company and
Ohio Tailoring Company by the Code Authorities and in view
of which these two firms were not investigated and were
considered by the investigators, Morris G-reenberg and
Edward Chavin, to be in compliance with Article II, Section
(b) of the Men's Clothing Code. The remaining ten firms
were investigated by us.
"The scope of investigation covered by the aforementioned
agreement could be classified as follows; namely:
1. Were underpayments made -
2. If so, to what extent -
3. Other Questions relating thereto.
4. Other auestions before the Code
Authority or Compliance Council
pertaining to alleged violations
of the Men's Clothing Code,
"In strict conformity with Article II, Section (b) of
the Men's Clothing Code, all of the firms cited with
deficiency bills can be said to have violated the Code
provisions referred to.
"The method and formula used by the Code Authority in
arriving at and computing the deficiencies in general can
be said to be sound, even though they appear to be more or
less artificial.
9782
-249-
"However, when r>re-code records of hours wor v ed are missing
it is necessary to make some assumptions in order to get at
pre-code wages -per hour. This, in itself ,' would weaken the
basis uioon which these deficiencies are determined as fixed
to individual workers. In some instances, this' resulted in
absurd conclusions. Th? only really satisfactory and equit-
able solution, for both the past and future, is a reconstructed
piece rate schedule similar to that worked cut for the Greif.
case.
"Bearing this in mind and also the broad t>urooses and intent
of the Code provisions involved in this situation, we made a
study of the direct labor costs of the basic products manufac-
tured for each of the firms affected, and then comuared these
basic costs with the costs of -products having strictly com-
parable labor content, in order to ascertain whether convpli-
ance existed in each case, with Article II, Section (b ) of the
Men's Clothin? Code. We com-oared these results with those
based upon the ao-olication of the method adopted by the Code
Authority to see whether they would, result in competitive
inequity.
"We disregarded the artificial method approved by the Code
Authority, mainly because of the varying results that could
be obtained by allying it to concerns in equal competitive
positions. The deficiencies resulting from t he Code Authority
method would differ defending upon the 'labor spread' . The
wider the spread the greater the deficiency, and the narrower
the spread the smaller the deficiency. For example, firms 1
having an average of sixty-four cents -oer hour, direct labor
cost r and having wide labor spread, could have the costs in-
creased more than a firm with an average of forty-four cents
per hour, direct If bar cost, and possibly a narrower labor
s-pread.
"Therefore, we based our investigations on comuarable -oiece
rate structures, always having the 'G-reif set-un in mind.
"Where the labor costs for the products manufactured were,
at the time, equal to or greater than the direct labor costs
of the -products having a strictly comparable labor content,
we recommended that those firms be declared in compliance
with Article II, Section (b) of the Men's Clothing Code and
be relieved of any -payment or assment in connection therewith.
A further increase in their direct labor costs would raise
their costs to a non-competitive level.
"Where the dir ;ct labor costs were lower than the direct
labor costs for products having comparable direct labor con-
tent, we recommended specific awards in each case, depending
upon whether the amount by which these direct labor costs
were less than those in products having a corn-parable direct
labor content.
"S-pecific awards were recommended in the following six cases:
9762
-250-
1. H. A. Seinsheimer Company
2. Levins Brothers, Inc.
3. • Sunerior Tailoring Company
4. Schwartz Tailoring Comnany
5. I. and S. Bing Company
6. Silverst in and Sons Comnany
"In formulating the recommendation for the award,. the
following facts were borne in min-^ , to wit:
"1. The six firms against whom the awards were made
could pay the entire Code Authority Bills and in doing
so would not raise their costs to a non-comnetitive level.
"2. To ask some of these firms, to nay the Code Authority
"bills as rendered when revised to cover the full neriod
would he impracticable since the large sums. which some of
the firms would have to nay might seriously affect their
set-uo, or jeopardize their continuance in "business.
"3. The "back nayment made by 'Greif comnrised annroxi-
mately one- third of the Code Authority Billings. There-
fore, the use of such anoroximate amount was made. Further-
more, at the time the recommendations were made, the Code
Authority Billings, to date, were not available; neither
was the -oeriod to be covered by back nayments known.
"4. Some degree of latitude had to be allowed in the
fixing of the awards because of the fact that all the
concerns involved had different tyoes of records and
systems and would not lend themselves very easily to
any one method of nrocedure to be followed in the dis-
tribution of back nay.
"5. The raising of the piece rate structure to the level
in our findings of fact, as being the n -arest comparable
competitive direct labor cost, was to take care of future
compliance, and do away with the possible recurrence of
the same situation that would eventually result; and in
fact, that condition is nresent today.
"6 These increases in direct labor cost for the future
were in some cases slightly greater than the increases
that would result were th3 Code Authority Billings met
in full, but in no case would they place the firms in-
volved in an inequitable competitive position. These
slightly additional increases would nartly coiro^nsate
the workers in future basic costs, for the substantial
reductions recommended in the amount of the back nay as
determined by the Code Authority.
"7. In the case of Levine Brothers ■, the snecial recom-
mendation that was made to ?et up piece rates was due to
the fact that that firm had nothing that could be con-
strued as a piece rate structure.
9782
-251-
"On December 22, 1934, the awards as nco-nm ended by us
and atrorovod "by Mr. Leon Henderson and Blackwell Smith
wera presented to Mr.. F.. C. Williams, Attorney for all
the Cincinnati firms. T ->n days were given to the resnond-
ent firms to file statements or "briefs in relation thereto,
after which the awards wer^ to go in effect, viz: January
2, 19-5.
"In the interim th3 six firms against whom awards w^re
issued retain id a new counsel.
"The n w counsel, Mr. Kusworm, requested time to study
the facts in the cose and acauaint hims If with th n sit-
uation. Time was granted, hut the awards were not changed.
"On February 20, 1935, a hearing was held before the
Advisory Council of the Co-nroliance Division to show cause
as to whv the r soondents in these cases should not he de-
prived of the use of tin 3ST. R. A. Blue 3asle and Cede Label
for failure to comply m ith the terms of the award. The awards
as rendered had b_ -n aeoroved by the Compliance Council.
"Objections were raised by the respondents' new Attorney,
Mr. T \uswor;n, at this hearing, to the entire oroce^dings
on legal grounds and methods of procedure. Futhermore,
he entered a motion that the Compliance Council set
aside and hold for naught the arbitrator's Findings
or awards made and to re-refer the matters to be arbi-
trated r--soecting the said six firms to the arbitrators
heretofore selected for the following reasons, namely:
"First, Finding (A) of the award, to the effect
that the Code Authority billing be re-
duced to a-p-proximately one-third, is
ambiguous.
"Second, Said Finding (A) is contrary to law for
th^. reason that the arbitrators did not
make, with reference to Finding (A), a
definite specific Finding.
"Third, That said award is contrary to the Code
of Laws of the United States, Article 9,
in Statute of February 12, 1S25, C-213,
Section 1043, Statute 885.
"Fourth, That Finding (B) which raises the costs
in all six concerns aforesaid of sack coats,
vests, and/or cants, is not in conformity
with the agreement cf arbitration and is
uron matters not submitted to said arbi-
trators. It is unfair and not for any
specified time.
9782
-252-
"Fifth, Said awards (B) are contrary to Code of Laws
of the United States, Article 9, Section 11,
Subsection B, being; also found in Statute of
February 1?, 1925, C-213, Sction 1143, Sta-
tute 885.
"Sixth, That the Finding or award against Levine
Brothers, Inc., marked (C) , to wit:
"That the costs be put on a complete new
piece rate basis, be set aside and held for
naught, because of the same reasons set
forth in th ; preceding paragraph marked
'Fourth' ."
It is not surprising to find tciat officials of the N. R. A. were not
in perfect accord and were none too sut. of their ground in the -oart -clay-
ed in hel-ohing the Code Authority with its II (b) c^ses. The following
extracts from an opinion from the Legal Division of N. H. A. ap-oears
rather conclusive evidence 'that the Administration was often filing its
way and traveling -oaths none too well-charted in matters of Code enforce-
ment* The following comments are directed particularly to the handling
of the Cincinnati cases: (*)
"Under the agreement dated October 19,' 1934, entered into
between the Men's Clothing Code Authority and the Cincinnati'
concerns, Blackwell Smith and Leon Henderson were to make
•findings' and these findings 'shall be final, binding, and
conclusive upon the parties hereto, and the firms listed
therein will make such restitution of the amounts so found,
; ' if any, to their workers forthwith.'
"Under this agreement Messrs. Smith and Henderson
were limited to two findings, (l) that the Cincinnati concerns
had either complied or nad not complied with Article II, Sub-
division (b) of the M'-n's Clothing Code, and (2) that in the
event that th? arbitrators found violations of Article II,
Subdivision (b) the concerns be required to pay th^ir employees
the amount of back Day found to be du.
"The awards maue by the arbitrators with respect to four of
the concerns were proper in form and substance.
"With regard to the following concerns the situation is quite
different. .....
(*) Memorandum dated May 6, 1935, from Louis J. Altkrug, Assistant
Counsel, to R. E. El well, Division Counsel. (Men's Clothing
Co<?e Fil-->s, under Employment - - - Wag-:s and Hours - - - -
Interpretations. )
9782
-253-
"In thr j case of each of these concerns the award made by
the arbitrators was in the following form:
"'(a) That the hack ray be reduced to approximately
one-third.
111 (b) That their cost be increased to the figures we
have indicated in our findings of fact as b^ing
the cost of fch - nearest comparable product,
namely, ' (Here certain costs are set forth
in each case for different articles made by
the concerns in question.)
"It is my contention . that the arbitrators had absolutely
no authority to make any such awards in the case of the
concerns found to hav< violated the Code. All that
Messrs o Smivb and Henderson could do was to find (l)
that each one of these concerns had violated the Code,
and (2) the amount that they would be reauired to nay
by way of restitution to each employee. Under the ar-
bitration agreement it was not within the scone of the
arbitrator to enter into the equities of the situation.
I therefore do not think that the awards made by the
arbitrators in the case of the second group of concerns
can hold water
"The next question is: What are we to do in view of the
present state of the record?
"Although the arbitrators may not have carried out their
arbitration in a proper manner and although their awards
may be subject to attach for that reason, I do not think
that we ought to do anything that would jeopardize the
fact that we have an agreement in writing from these
p ople to arbitrate. I think that the arbitrators should
call on both parties concerned, i.e,, the Men's Clothing Code
Autnority and the six Cincinnati concerns and advise them that
hearings will be held and each side may introduce such testi-
mony as they see fit in support of their respective positions.
The arbitrators can then examine these reports and the reports
submitted by Messrs. Chavin and G-reenberg and they can then
make their findings (l) that the six concerns have complied
or not complied with Article II , Subdivision (b) of the Code"
in view of the interpretation made by Lindsay Rogers on
November 3, 1953, and approved on June 9, 1934, and (2) if the
Cincinnati concerns have not complied, the amount due to each
employee as calculated in accordance with the interpretation
in auestion.
"If the Cincinnati concerns feel that these awards are in-
equitable they may then r^auest that th ' full facts of each
case be submitted to the Committe. provided for in Article II,
Subdivision (d) for their -further consideration in accordance
with interpretation approved on S.ptemb r 26, 1933, referred
to above. That Committ3e may then make its recommendations
9782
-254^
and awards on the basis of ecruities of the' situation.
"I think that it would he very dangerous to go into
court on the record we have "before us and I would
recommend that steps be taken to insure an arbitration
within the terms of agreement of October 19, V934. We
ought not to do anything that would annul this agreement. "
The Men's Clothing Code files do not reveal further evidence con-
cerning the Cincinnati cases. Apparently the Supreme Court decision
invalidating the Codes brought an end to all negotiations.
IX. "EMPLOYMENT AND WAGES UNDER THE CODE
The Code Authority under provisions of +he Code accumulated
valuable records which were used chiefly in connection with enforcement,
Nevertheless, certain compilations of interest have been made of -pay-
roll and production data '"itch give a fair indication of trends within
the industry
March was the height of the 1934 s-oring season in the Men's
Clothing Industry. Code Authority payroll records show that 127,919 '
workers were employed during the month, by 1,950 establishments. In-
cluding workers employed by uniform manufacturers, who report sepa-
rately, and those employed by small manufacturers and contractors
not reporting, it was estimated by Code Authority officials that
140,000 workers were employed at the peak of this season. It was es-
timated that 108,000 were employed in. March, 1933. Accordingly, employ-
ment in March, 1934, represents a gain of around 30$ over March, 1933.
From March, 1934, .to .September., 1934, however,, there was a reduction
of about 15% in the number of. oersons employed. This was due to the
slackening of production during the. summer, season. ■(*)
Hourly wages for all manufacturing employees,-; including cutters
and pressers, in July, 1934, averaged 67,1 cents per hour. In March,
1933, the average wage was approximately 42 cents per. hour. (Hourly
earnings in the Industry reached their peak in 1934, when they were 76
cents per hour.) The gain in weekly wages from 1933 to 1934 was not so
large as the gain in hourly wages because of the reduction in number of
hours worked^ for a full time worked period. During August, 1934, the
peak month of the summer season, ■ manufacturing employees worked 27.8
hours per week on the average, while weekly earnings averaged $18.63.
Because of the practice- of division of work in the Industry, the
figure of the number of hours worked is mor? than the number of persons
listed on the payroll. (**) ,
(*). Report of Men's Clothing Code Authority Committee on Statistics,
dated September 13, 1934. (Men's Clothing Code Files)
(**) Report of the Mm' 3 Clothing Code Authority Committee on Statistics,
dated September 13, 1934. (Men's Clothing Code Files)
9782
~255-
To what extent the M^n's Clothing C->de or for that matter N..R.A.
was responsible for improved conditions of employment and wag^s during
the Code t> riod one cannot estimate with any degree of accuracy. Yet,
it r- mains a fact that there was 1 marked improvement, a considerable
measure of ^hich resnoncihle members *f the Industry are willing to at-
tribute to N.'R.A. and the Men's Clothing Industry Code in particular. •
On May 22, 1935, Mr, Mark 1. Cresap, President of the Clothing
Manufacturers Associati a of the United States, made nublic a statement
favoring the continuation of F.R.A.; in which ho summarized the experi-
ence of employees in the Men'? Clothing Industry under the Code by
citing the following figures: (*)
Number of Total Man-
Workers Hours Worked
Period Em-cloyed Per Week
March' 1929 154,135 5,548,360
March 1933 109,610 3,157,729
March 1935 147,066 4,897,298
Average
Weekly
"Samings
$24.82
*12.68
$22.04
Total
? Weekly
Fay roll
$3,825,631
$1,389,855
$3,242,011
(For additional statistical data bearing uoon employment,
wages and hours during the Code period, see Chanter II, pages 93-111.)
(*) Source: . Code Authority estimates based on U. S. Census and Bureau
of Labor Statistics figures.
97S2
-256-
chapter vi
eia.de practices
i. codal trade practice provisions
The Men's Clothing Code as originally approved carried provisions
regarding only two practices under the title "fair trade practices" and
these are found in Article XII as follows:
"The following rules of fair trade practices are hereby established
for the clothing industry:
"(a) The sale of garments on consignment is prohibited as an unfair
method of competition. The term "consignment" as herein used shall
include the delivery by a manufacturer to any distributor, as
agent, purchaser, or otherwise 9 under any agreement or understand-
ing, expressed or implied, pursuant to which the seller retains
any lien upon or title to or interest in the goods delivered, or
pursuant to which the distributor may at his<'Option return any of
the goods or claim any credits with: respect thereto. This pro-
hibition shall not apply to contracts entered into prior to July
14, 1933, the term of which expires within one year from the date
of the enactment of the National Industrial Recovery Act.
"(b) A manufacturer or a contractor shall not make garments from
fabrics, trimmings, and/or other materials owned or supplied by a
retail distributor or the agent, representative, or corporate sub-
sidiary or affiliate of such retail distributor; nor shall he
manufacture garments from fabrics, trimmings, and/or other mater-
ials, the purchase of which is made upon the credit of or the pay-
ment for which is guaranteed by such retail distributor or the
agent, representative, or corporate subsidiary or affiliate of such
retail distributor. This section shall not prohibit the operations
of retail distributors owning and operating their own plants,
shops, or factories who distribute products manufactured therein
directly to consumers."
There was added by Administrative Order on April 14, 1934, a new
section to Article XII, known as Section (c), which read as follows:
"No member of the Industry shall publish advertising (whether
printed, radio, display of any other nature), which is misleading
or inaccurate in any material particular, nor shall any member, in
any way misrepresent any goods (including but without limitation
its use, trademark, grade, quality, quantity, origin, size, sub-
stance, character, nature, finish, material content or preparation)
or credit terms, values, policies, services, or the nature of form
of the business conducted."
Article X of the Code reads as follows:
" On and after the effective date, it shall be unfair competition
for any manufacturer in the Clothing Industry, either directly or
indirectly, to sell its manufactured product at a price below its
9782
-257-
cost as determined, wituout any subterfuge in accordance
with sound accounting practice. Cost shall include the cost of
piece goods consumed, trimmings, cutting, and making; and
, a percentage on the selling price to cover all overhead."
Article X additionally provided for exemptions in the case of
"seasonal clearances of merchandise" specifically defined and the
closing out c£ '-'dro eel linos or surplus stocks" upon report to
the Code Authority *
II. CONSIGNMENT SELLIITG
The above-quoted provision of the Code in prohibition of consign-
ment selling in the Industry met with the full approval of "both groups
which proposed Codes to the Administration. The wording of the pro-
vision is almost identical with that suggested by the Industrial Re-
covery Association » The Clothing Manufacturers Association did not re-
commend a specific cor^'gnment provision, but expressed itself as
opposed to consignment selling and described the practice in the' follow-
ing language:
"(a) There has developed a growing evil in the clothing industry
commonly kr.ora as ''Lelivery of merchandise on consignment
or memoranda" by the manufacturer to the distributor. This
was accomplished by- any of the following methods: (l) By being
billed on consignment- or memorandum. (2) By malting the distri-
butor an agent of the manufacturer in the sale of the product.
(3) By agreement- to take merchandise back that remained-unused
after a given timer (4) By agreement that merchandise unsold
after a given time may be exchanged for other goods. (5)
By agreement that merchandise unpaid for within a given time
may be reclaimed or returned and other and various agreements
designed to weaken or modify the usual terms upon which an
order for the maiv.v^ctui-e and sale of merchandise to cover the
requirements of the distributer is given to the manufacturer. "(**)
The Clothing Manufacturers Association; in further support of the
proposal to eliminate consignment selling from the Industry, argued
in the pre-Ccde hearings that consignment selling was unfair to both the
retailer and the manufacturer. It was contended that a manuf ac ture r
selling on consignment in a case where the retailer got into financial
difficulty could withdraw his merchandise without risk of great loss
whereas the manufacturer selling outright stands to lose to a greater
extent. If the retailer was strong financially and bought on con-
signment, it was asserted that this had a tendency to encourage the
accumulation of unmanageable surpluses. Finally, it was asserted that
the practice of shipping goods for a few days for special sales usually
(*) For a discussion of machine hour provisions in the Code, see
Chapter V, page ■
(**) Code submitted by the Clothing Manufacturers Association to the
Administration, -July 13, 1933. (hen's Clothing Code Files.)
9782
-258-
resulted in a very low price with the consequent , forcing-down of
rates. (*)
While no organized objection to a codal provision outlawing con-
signment selling was in evidence during the writing of the Code, later
the Woolens and Trimmings Distributing Trade made some effort to obtain
modification of the adopted provision especially as concerned the Tailor s-
to-the-Trade "branch of the industry. (** )
The Woolens and Trimmings Distributing Trade was anxious to con-
tinue a practice existing prior to the Code which made possible sales
in large quantities to individual manufacturers with widespread outlets
built up by consignment selling. Nevertheless, the Code Authority
advised the Administration that no change was favored "in view of the
unanimous opinion of that branch of our Industry ( Tailor s-to-the-Trade) .
By Administrative Order, five separate firms have been granted
exemption in the consignment selling provision of the Code. These
firms, with date of exemption and number of Administrative Order re-
lating thereto, are listed as follows:
S. Makransky & Son, Inc., Philadelphia, Pa. August 2, 1934,
Administrative Order No. 15-32
Hickey-Freeman Co. and Cohen Goldman Co., Hew York City. August
28, 1934, Administrative Order No. 15-34
Moritz and Winter Co., Milwaukee, Wisconsin. January 8, 1935,
Administrative Order Ho. 15-48
Levy Bros. & Adler Rochester, Eochester, N. Y. January 12,
1935, Administrative Order No. 15-32
The Men's Clothing Code Authority has consistently refused to
approve any requests for exemption under the consignment selling prov-
ision of the Code. The one and only slight deviation from this policy
is noted in connection with the Code Authority's approval of the propos-
ed extension of the exemption granted to Hickey- Freeman Co. and Cohen,
Goldman Co.,'ronder Administrative Order No. 15-34. (****)
(*) Testimony of J. G. Eickey, Men's Clothing Hearing of July
26, 1933, Transcript, Pages 53 a nd 64.
(*•*) Transcript of "Informal Conference between Eepresent-
atives of Men's Clothing Industry and 7/oolens and Trimmings
Distributing Trade, October 11, 1934." (Men's Clothing Code Files.)
(***) Letter dated December 6, 1934, from George L. Bell, Execu-
tive Director, Men's Clothing Code Authority, to Deputy Adminis-
trator M. D. Vincent. (Men's Clothing Code Files.)
(****) Letter dated March 3, 1935, from Morris Greenberg,
Executive Director, Men's Clothing Code Authority, to Walter E.
Woodford, Jr., Assistant Deputy Administrator. (Men's Clothing
Code Files.)
-259-
A brief review of the exemptions granted under Article XII, Section
(a) of the Code, as listed above, will present wore definitely the ex-
tent and character of consignment selling in the Industry.
A. The case of S. Lakransk" and Sons. Incorporated .
The Kakransky c; < Ls Lm tortant in that it established a precedent
in -the Industry, and concerns more individual establishments than all the
other cases combined. The Administrative Order of August 2, 1934, granted
the firm's Application on condition that sales be continued only to re-
gular customers and that pending an investigation into all aspects of
the ap-olication, The applicant ted suggested complete exemption for a
period" of one year., stating that it had approximately 240 consignment
accounts which could not be reduced to an open credit plan. It was.
asserted that consignment selling represented $1,200,000 out of a total
of $3,345,000, and that to. change the methods of operation immediately
would result in distress merchandise being thrown on the market and
would Cause the unemployment of 500 or 600 manufacturing employees.
The investigation provided for in Order No. 15-32 was completed
prior to September 14, 1934, according to Report of Executive Director
Bell to the Code Authority in which he stated, "The facts as produced
in the reports seem not to warrant the granting of any further exemption,
and we filed a formal request for Hearing on the matter, should the
Administrator decide that there should be an exemption granted. 1 ! The
Code Authority's views did not prevail, however, as on December 24,
1934, through Administrative Order No. 15-45 the exemption of the Mak-
ransky firm was continued to June 15, 1935, and provided that 133 firms,
the names of which were, filed with the National Industrial Recovery
Soard, might be sold goods on consignment, these being accounts which
could not be liquidated by June 15, 1935, "without undue hardship and
financial loss."
B. Cases of Hicke--- Freeman Co., Few York,- and Cohen -Goldman Co.,
Few York.
The Rickey- Freeman Company and the Cohen-Op ldman Company were
granted permission by Administrative Order To. 15-34, dated August 28,
1934, to ship goods on consignment, with the right to petition for a
further period of six months. The petitioners indicated that they
favored the consignment provision of the Code and believed that as a
rule merchandisers should assume retailers' risks. They asked an ex-
emption, however, in the case of the one firm to whom they had been
.ing on consignment for two years. The firm was represented to be
old and of excellent reputation, slowly recovering from financial em-
barrassment due to the depression, but for which additional time was
necessary for it to demonstrate its worth and possibly attract new
capital.- Early in March 1935, the interested parties requested a sir-
months' extension of the original exemption and presented in support
9732
-260- \
thereof the recommendation of the Code Authority. (*) This e:;tention
was granted by Administrative Order ho. 15-64, dated April 1, 1935, :
upon the same terms as the original exemption.
C . Case of Horitz and Winte r Company .
Moritz and Winter, through Administr tive Order ho. 15-48, dated
January 8, 1935, was privileged to ship on consignment to nine firms,
the names of which are on file with the National. Industrial Recovery
Board, to June 15, 1935. There nine accounts were found by the Ad-
ministration to be those "which could not be liquidated by June 15, 1935,
without undue hardship and financial loss." This finding was made after
the Company had submitted a detailed analysis and description of each
account .
D . Case of Lev"/' Brothers and Adler Rochest er.
Levy Brothers and Adler Rochester uoon application was granted ex-
emption from Article XII, Section (a) by Order No. 15-52, dated January
12, 1935. The Order provided that consignments could be made to the one
firm named in the Order up to June 15, 1935. The applicant, as in the
other cases, presented details concerning its business relations with
its customer showing the latter' s need of financial assistance.
On March 5, 1935, the Administration was asked to grant an exemption
from the consignment provision of the Code to Waldman & Sons, New York
City. In accordance with usual Administrative procedure, the case was
referred to the Code Authority for recommendation. (**) On March 11, 1935,
the Executive Director of the Code Authority advised: "The attitude of
our Code Authority has been consistent on this point. It has disapproved
similar requests and feels that it qannot, in fairness, approve this
request, nor does it wish to establish a precedent by recommending the
granting of this petition." The Administrator, relative to this request
for exemption directed an inquiry to the petitioner asking that the firm
"advise us when you last sold this firm goods on consignment. Will .you
please also indicate what, if any, newly developed circumstances justify
an exemption be granted at this time."
E. Complaints Arising From Consignment Exemptions.
On March 1, 1935, Mr. F. M. Curlee, Counsel to the Industrial Re-
covery Association, made a. complaint relative to the exemptions from
Article XII, Section (a) by the Administration. The complaints were that
there was no legal justification for keeping secret the names of the
133 firms filed with the National Industrial Recovery Board, to which
Makransky was selling on consignment and that orders of members of the
Industrial Recovery Association had been cancelled by retailers who had
(*) Letter dated March 2, 1935, from Morris Greenberg, Executive
Director, Men's Clothing Code Authority, to Walter E. Wood-
ford, Jr., Assistant Deputy Administrator. (Men's Clothing
Code Files.)
(**) Letter dated March 5, 1935, to Morris Greenberg, Executive
Director, Men's Clothing Code Authority, (lien's Clothing
Code Files.)
9782
-261-
snecial arrangements with the Hakransky firm not available to retailers
generally.
In reply to the above complaints on March 5, 1935, Deputy Adminis-
trator M. D. Vincent advised Mr. Curlee that the matter of making public
the names of the ilak: y firms customers had been referred to the Legal
Division, which adviued chat the names were confidential. Additionally,
it was explained that ii the facts are as reoortcrd by Mr. Curlee, they
constitute the baris for an abdication to terminate or modify the
llakransky exemption. I J :- was suggested that the members of the Industrial
Recovery Association make such application without delay.
Relative to this complaint a letter was addressed to the Hakransky
firm by the Administration advising of the general complaint and reauesting
that the Company report as to how many of the 133 firms still remain
on the Company's books and the number 'Of firms without a. source of
credit and to which consignment shipments are still made.(*)
III. CUT, MAKE, AND T tli
Article XII, Section (b) of the Code, above-quoted, was designed
to outlaw a practice which had developed in the Industry, relative to
which there was close agreement between the exponents of the two Codes
offered for Administrative approval. This practice is generally re-
ferred to as manufacturing on a "cut, make , and trim basis," and is
described and criticized b^ the provision relating thereto and found
in the Code proposed by the Clothing Manufacturers Association, as
follows: (**)
"There has developed in the clothing industry a pernicious
practice on the part of a certain class of distributors to man-
ufacture clothing without the usual responsibility and obli-
gations that a producer in the industry owes to labor of giving
labor decent hours of work, fair wages, and sanitary working
conditions. A distributor "by exerting price pressure on these
operators, forces the price of labor down to a point which has
become a menace to the industry and labor. This is accomp-
lished by:
(l) The distributor buys the cloth and farms it out to fly-
by-night and irresponsible persons v. ho carry no annual over-
head and who shift their plant from place to place, making or-
derly supervision of hours of work, wages, and sanitary labor
conditions in their plants impossible* The cloth is cut by
these irresponsible contractors, trimmed and made up into
garments. This evil has grown and threatens the legitimate
distributor and producer. (2) The establishment of credit
(*) Letter dated March 12, 1935, to S. Makransky & Sons, Inc., from
"alter E. "Toodford, Jr., assistant Deputy Administrator. (Hen's
Clothing Code Files.)
(**) Code submitted ~oy the Clothing Manufacturers Association to the
Administration, Jul" 19, 1933. (Men's Clothing Code Files.)
9782
-262-
lr r the distributor for the "benefit of the so-called manufac-
turer with the woolen mills so that while in theory the .goods
are charged to the manufacturer they are in fact p\ir chased and
paid for by the distributor or with none 1 " advanced bv the
distributor to the manufacturer with which to Day for sxich
merchandise, (o) Or any subterfuge which results in a- contract
for manufacturing on a "cut, make, and trim basis" pje unfair
practices. '
"The foregoing provisions shall sot be construed to prevent
a retailer from selecting or ordering any cloth for the ac-
count of a manufacturer, but the cloth so ordered or selected
must be -oaid for by the manufacturer, and the price for which
the cloth was purchased must be included in the cost of the
completed garment, subject to the uniform cost accounting
practices provided by the code."
As above stated, both associations proposing codes condemned the
practice of "cut, make, and trim." r Jith respect to the last paragraph
of the proposed clause above-quoted, the Industrial Recovery Associa-
tion states: " r /e believe that the concluding sentence of the U.S.A.
Code provision emasculates the section. !7e believe the prohibition
should be made unqualifiedly as in the Industrial Recovery Code."(*)
The Industrial Recover" Code had suggested an "unqualified" pro-
hibition of the "cut, make, and trim" practice in the following pro-
vision: (**)
"The manufacture of garments from fabrics, trimmings, and
other materials owned or supplied by a retail distributor, or
the agent, representative, or corporate subsidiary or affiliate
of such retail distributor, is prohibited. The manufacture
of garments from fabrics, trimmings and/ or other materials
the purcna.se of which is made upon the credit of, or the pay-
ment for which is guaranteed by, such retail distributor, or
the agent, representative, or corporate subsidiary or af-
filiate of such retail distributor, is prohibited. This sec-
tion shall not prohibit the operations of retail distributors
owning and Operating their own plants, shops or factories
who distribute products manufactured therein directly to
consumers ."
In the July 26, 1933, hearing pursuant to the adoption of a Code,
Mr. Victor Riesenfeld, spokesman for the Clothing I.ianufacturers As-
(*) Statement of the Industrial Recovery .-issociation to Adminis-
tration, February 2, 1935, Sxhibit 6, page io? • (lien's
Clothing Code Files.)
(**) Code submitted to the Administration by the Industrial Re-
covery Association of Clothing iianufacturers, July 19, 1933.
(Men's Clothing Code Files.)
9782
-363-
sociation, summarized the reasons for prohibition of the "cut, make,
and triii" practice as follows :(*)
"It has been indulged in in most instances by retailers
for the purpose of undersell ,.n, ; their competitors, or where
the lover selling price than the generally accepted standard
is the main consideration for getting business. The pre-
ssure of competition in forcing down the cost of cutting,
making, and trir" iv; has become a menace to labor and to
industrj'". The special type of contractor or manufacturer
doing this type of work has been for the most part the
most irresponsible."
A. Proposed Amendment ^o Cut, Make, and Trim Provision.
For several months after the adoption of the Code, no complaints
were made to the Administration respecting the codal provision which
had presumably outlawed the "cut, make, and trim" practice. On recommen-
dation of the Code Authority, however, a public hearing was held in
Washington, January S, 1934, with the view. to broadening and strength-
ening this claiise cf the Code, The Code Authority suggested an amend-
ment to Article XII, Section (b) which was designed to bring jobbers
and wholesalers cf men's clothing under the same restrictions which the
existing codal provision olaced upon retailers, giving the same reasons
therefor as had been offered in behalf of the original provision. It
was further asserted that "the clothing industry is subject to unfair
competition and this is one. of the elements we have discovered should
be amended and corrected. "(**)
As a further reason for asking the amendment, counsel of the Code
Authority stated "*** without authoritatively stating so, the Code Auth-
ority has discouraged in a large number of instances the practice of cut,
make, and trim. The only reason I come before you now and ask for the
amendment is because i feel that the legal language of the Code might
not be sufficient to warrant the interpretation placed upon it.(***)
It developed in the course of this hearing that the proposed amend-
ment would effect the operations of not more than thirty-five firms at
the most, and counsel for the Code Authority testified that "the cut,
make, and trim business in the Clothing Industry is not yet tfide-
(*) Transcript of Hearing on Men's Clothing Code, July 26 and 27,
1S33, Pages 93 ar.a.94.
(**) Transcript of Hearing on Men's Clothing Code, January Z, 1934,
Statement of David Drechsler, Counsel, Men's Clothing Code Auth-
ority, Page 7 #
(***) Transcript .of Hearing on Men's Clothing Code, January 3, 1934,
Statement of David Drechsler, Counsel, Lien's Clothing Code
Authority, page 45 # .
9732
' -264-
spread."(*)
Inasmuch as the chief argument advanced in favor of the proposed
amendment was that the jobbers and wholesalers engaged in the iflanu-
facture of clothing were not economically responsible for the main-
tenance of labor standards, the question of resionsibilitjr under the
Code definition from a legal standpoint ,-rose and was the subject of
much debate. The legal adviser to the A&iuinistr tion gave the opinion
that "whether he is called a contractor or a wholesaler, or v.hatever
he may be called, so long as he is engaged in making these garments,
he is covered by the Coc'e."(**)
Counsel for the jobbers and wholesalers present tool: a like view
and reasoned that they had subscribed to the Code provisions "in the
;oast and considered themselves legally bound to do so. They contended
that the proposed amendment v.mild result in making illega.l their bus-
iness of "manufacturing" which consisted only in planning and directing
the production, whereas all technical operations were performed b- ; - hired
contractors or manufacturers.
The labor adviser to the administrator argued that the jobbers
and wholesalers were not manufacturers as they claimed — but simply
merchants — and that it was ~oy reason and experience impossible to hold
these people effectively responsible for labor provisions of the Code.
(***•) The labor adviser also argued that it was labor's understanding
from the inception of the Code that the "cut, make and trim ;orovision
was intended to cover the whole field. "(****)
The consumers' adviser to the Administration expressed opinions
in opposition to the proposed amendment on the grounds that its adop-
tion would remove "a very preferential price differential in this
industry, as the contractors certainly could produce garments at a
lower price than the conventional manufacturer. "(***** ) it v/as added
that the amendment would restrict the production of garments which are
probably favorable in price to the public.
The Administrator toward the close of the hearing gave expression
to his views in stating that "this Amendment suggested will do harm to
small producers ji(******)
(*) Transcript of Hearing on ken's Clothing Code, January 3, 1934,
statement of David Drechsler, Counsel, lien's Clothing Code
Authority, pages,
(**) Transcript of Hearing on ken's Clothing Code, Jan. 3, 1934,
Page 19 o
(***) Transcript of Hearing January 3, 1934, Page 30.
(****) Transcript of Hearing January 3, 1954, Page 45.
(*****) Transcript of Hearing January 3, 1934, Page 74 >
(******) Transcript of Hearing January 3, 1934, Page 75,
9782
-265-
It was suggested also by the Administrator that the evils aimed at
were still "hypothetical dangers" which could be dealt with when the
occasion actually arose.
The final outcome of this hearing on the "cut, make, and trim"
provision of the Code is best explained in the words of the Deputy
Administrator in charge, as found in a memorandum addressed to' the
Administration Member of the lien's Clothing Code Authority, as follows: (*)
"The result of the hearing on the Cut, Make and Trim Amendment to
the weu's Clothing Code authority was a reference back to the
Code Author it,-'.
"At the hearing it developed that certain concerns having con-
tracts with Hillman would be out out of business. This was not
the intent of the node Authority, nor the desire of either
Hillman or Drechsler.
"It seemed satisfactory to all, therefore, that the matter be re-
ferred back to the Code Authority and that some other way be
devised to accomplish the purpose desired without possibly
doing wanton injury to any business."
(*) memorandum of January 4, 1934, from Earl De:n Howard, Demitv
Administrator, to 3. H. Gitchell, Administration Member.
(Wen's Clothing Code Files, under Amendments A-H.)
9782
. -266-
B. TIIE SZARS ROEBUCK EXEMPTION- CAS'2 . .(Lower Case)
Upon the application of Sears Roebuck Company, of Chicago,, for
exemption from the "cut, make, and trim" provisions of the Code a
public hearing on . the matter was held in Washington May 29. 1934. The
Company based its appeal on the contention that hardshipswould.be
suffered if wcolcns could not be bought for contractors; that the
company did not desire to give up its old manufacturers, especially
in that th'es^ "small manufacturers are better sources of supply for
us because of the fact that our business is more valuable to, them,
and therefore they are willing to adapt their patterns, sizes, styles
and manufacturing details to our requirements;" that through- present
arrangements, the company has been able to supply the low income
class of customers with good quality clothing at low prices — ; ' "
that it is necessary "to place orders for large quantities of cloth
before mills make their regular showing to the trade;" that catalogue
commitments must be protected by the company itself since the manu-
facturer would not know what quantities to buy even though financially
able." (*) In the testimony of Sears Roebuck it was brought out that
60 per cent of their clothing business would be affected by this codal
provision. The tail Order Association of America, Inc. , Joined with
Sears Roebn.ck, not in; requesting an exeni tion, but i. contending that
the entire codal provision should be remov d from the Code, pointing
out that confusion in the early writing of codes had caused them to
overlook protests at that time, but that as early as March, 1934, verbal
and written protests had been made to the Administrator stating that
the codal -provision was considered "unfair and discriminatory" and that
an amendment was in order. (**)
By Administrative Order'No. 15-17, dated July 19, 1934, Sears Ree-
buck was denied the requested exemption. The D e puty Administrator ad-
vised in support of this order that the hardship suffered by Sears Roe-
buck did not jeopardize their clothing business and that other dis-
tributors have the same claim to exemptions, which, if granted, would
impair the codal provision. Thus, it was pointed out that the only
issue heard was that of the requested exemption -aid that the codal
provision was not on trial. The report of the consumers' adviser
attached to the Order of denial recommends the granting of the
requested exemption on the grounus that a denial would work a
hardship. The Research and Planning Division advised in favor of ex-
empting the applicant and others similarly situated on the ground
of Research and Planning' s objection to the original incorporation of
the provision in the Code.
C. PROPOSED irTIRPRETATIOl! OF CUT, MAKE, APD TRIM PROVISION (Lpwer-case)
The Administration Member of the Men's Clothing Code Authority, on
(*) Transcript of Hearing May 29, 1934, Sears Roebuck Co. Application
for Exemption, Pages 16, 19 and 20.
(**) Transcript of Hearing May 29, 1934, Sears Roebuck Applicant for
Exemption, P a ge 12.
9782
-267- ...
October 15, 1934, advised the Administrator that the Code Authority wished
to amend Section (b) of Article XII of the Code, so that "It should not
apply to such manufacturers' who make garments for tailors-to-the-trade
and special order houses when such garments are made to measure for the
individual customer!^*) This proposed amendment carried the approval of
the Administration Member, Hie Deputy Administrator referred this matter
to the legal adviser, who reported thereon as follows: I agree with the
principle involved in this interpretation. Nevertheless, I feel that
this interpretation in effect amends the Code provision and I "believe
that the proper remedy is an amendment to the Code rather than the in-
terpretation. ''(**) Subsequently this proposed interpretation was sub-
mitted as an amendment and was noticed to be heard April 15, 1935,
IV THE COST FOBiraiA
As indicated at the beginning of this Chapter, the Code carries a
selling below cost prohibition. The Code Authority, early after its
establishment, appointed a Committee on Cost Accounting charged with the
responsibility of devising a cost formula upon the basis of which
Article X could be enforced. This Committee consisted of the following
representatives of the Industry!
Julius H, Lev;' - , Executive Secretary, , New York
Clothing Manufacturers Exchange.
Samuel Browne, Comptroller, Hart, Schaffner &
I.iarx, Chicago.
TJh, B, Flickstein, Secretary, Philadelphia Cloth-
ing Manufacturers Association, Inc.
Jerome I. Udell, Max Udell Sons and Co., Hew York.
Isadore Wolrich, Hew York Knee Pants Co.
Harry C, Freneau, Secretary and Treasurer, B.
Euppenheimer and Co., Inc., Chicago.
John D. Stevenson, Secretary and Treasurer, Fashion
Park Manufacturing Co,
On November 8, 1933, the above Committee reported to the Code Au-
thority that various markets and records had been studied with extreme
care aiid that recognized firms of certified public accountants had
cooperated by making analyses from their statistical records. The
results of the investigation and report were summarized as
(*) Letter from 3. H. Gitchell, Administration Member, To Dean G. Edwards
Deputy Adninistrator, dated October 15, 1934. (Men's Clothing Code
Files, )
(**) Memorandum dated October 26, 1534, from A. H. Barenboim, Assistant
Counsel, to Dean G. Edwards, Deputy Administrator, (Men's Clothing
Code Piles. )
9732
-363-
follows: (*)
"In determining the ' irreducible minimum, ' the committee has "been
guided "by "the "belief that it was not the intention of the Code
to protect inefficient manufacturers operating under the high-
est overhead, or to base the formula on the records of a small
number of manufacturers who may be operating at the lowest
overhead, but to use as a basis the average by and large of a
fair cross -section of th e entire indust ry over a -period of t he
last five year's . "
"A study of all of the figures led to the decision that the
'irreducible minimum 1 for the computing the total cost of a
garment should be arrived at by adding to the prime cost (woolens,
trimmings, tailoring, cutting and sponging) an amount equal to
5 per cent of such prime costs for General I.ianufacturing Overhead ,
and by adding to the new total so obtained an amount equal to
11.11 per cent for Selling and Administrative Overhead ."
In order to place contract shops and inside shops upon a fair
competitive cost basis the Committee further recommended:
n***as a preliminary step, in order to enable inside shop
manufacturers to properly compute the prime costs — that
a minimum, 'of 20 per cent be officially approved as the
overhead that shall be added to productive labor by an in-
side shcp manufacturer in a rriving lat the cost of tailoring.
Cost of 'sewing 1 ' shall then be added as a component part of
the total tailoring costn."
The Committee recommended that the figure 5 per cent for General
Manufacturing Overhead and the fig-are 11.11 per cent for Selling. and
Administrative Overhead be mandatory. . Attention was especially direct-
ed to the fact that S G lling and Administrative Overhead classifica-
tions did not include advertising and that the formula "makes no pro-
vision whatsoever for profit and is therefore not to be considered as
a recommended sales price. 11
It is not clear exactly when the Code Authority's cost .formula
was submitted for Administrative approval., Howe.ver, the Executive
Director reported to the Code Authority on January 8, 1934, that the
formula had not been approved, adding:" (•**)
(*) Report of Cost Accounting Committee of the Lien's Clothing Code
Authority. . (Ken's Clothing Code Files.)
(**) Report of Executive Director to the Code Authority, January 8,
1934. (lien's Clothing Code Piles.)
9732
-269-
"***I brought the matter to the attention of several of the
higher officials pointing out that it was unfair to leave us
in our present situation as the 'selling below cost' nrovision
in our Code is practically meaningless unless we nave" some
formula."
Again on September 14, 197A, the Sxecutive Director reported
to the Code Authority: (*)
"As you know they disapproved the formula we submitted and
also informed us that they were going to rewrite our entire
clause on the subject. I have had the matter un with every-
body concerned at Washington but the only response that I can
get is that the whole matter of selling below cost in our
code, and in many other codes, is still being considered by
the Legal Department."
* , Jl l f e ^ onse to various Inquiries made of the Administration as
to what had been done relative to re-drafting the cost provisions of
;- ens Clothing Code, the Deputy Administrator on September 17
1934, advised Mr. Dell, Executive Director, of the general Administra-
tive policy m regard to costs by forwarding release, No. 5600 with
the comments: "I question whether or not the open price filing oro-
visions would be practicable in the Lien's Clothing" Industry. It appears
however that an application of the cost and .rice cutting "revisions
as outlined m Po. 228 (office memorandum), should be of great v^ue
to you." One week later the Deputy Administrator advised an official
of tne Coae Authority that "your code contains the provision regarding
selling below cost and we feel that you should attempt to enforS thif
Provisions and if this should prove inadequate, it snould be tended
« accordance with the latest policy of administration." (**)
of the\,°f °+r, 8 ' X f 4 ' thG Admin "trator in reviewing the history
tL t^! C ? St acco ^ tin S system summed u, the opposition to
tne proposed, formula, as follows: (***)
55* ri 2 ^ 1 !?. 01 ™ * ' t0 th ° CodG Authority, January 8,
±y---4. (Men's Clothing Code Files)
(**) Letter dated September 25, 1934, from M. D. Vincent, Deuuty
Co^niesT' t0 C0raptr ° ller H - K ' Herwitz « CMen's dotning
^^ St^tor ? '1o ° Ct t- 3r % 19Z4 ' fr ° m H ' D - Vincsnt ' ^puty Admin-
"7> 4 " riK f Horowitz, Assistant Co-ansel Men's Cloth-
ing Coae Autnonty. (Pen's Clothing Code Files)
9782
-270-
"I see nothing in the Ken's Clothing Code which would
permit the Code Authority- to stipulate a mandatory
overhead percentage. Regardless of the merit of the
particular percentages chosen, the procedure would,
appear to be ultra vires."
This statement of the Deouty Administrator was in line with opinions
expressed by his advisers. The Research and Planning Division as early as
January 29, 1934, had expressed this view and the Consumer Adviser on
January 30, 1934, stated: "Article X refers to cost elements which are
those of the manufacturer himself, thus, the standard rate of overhead
which is recommended by the reports of the committee on cost accounting
should not be made mandatory on every member of the industry. "
(a) Uniform Ac counts
The executive Director of the Code Authority, on August 29, 1934,
pointed out to the Administration the difficulty of securing adequate
information from certain manufacturers and contractors who failed to
keep time cards for more than one or two months, and inquired whether
or not the Administration would not order manufacturers and contractors
to keep records for a period of one year based upon the eodal provision
Article XIII, Section (d) clause 1 which empowered the Administrator to
require "***the keeping of uniform accounts as may be required to secure
the proper observance of the Code***." The Executive Director argued
that such a requirement would not be as drastic as an order "requiring
the keeping of uniform accounts. "*
This inquiry from the Code Authority elicited from the Adminis-
tration the response that "If the Code Authority will formally recom-
mend a ruling in this regard, this office will attempt to obtain a
final determination. "**
7. COMPLIANCE 7ITII TRADE PRACTICE PROVISIONS
The hen's Clothing Code Authority early recognized the impos-
sibility of attempting to enforce Article X of the Code especially
in that the proposed cost formula was not approved by the Admin-
istration. On July 12, 1934, the Code Authority advised the Compli-
ance Division that "Our investigators with reference to this provi-
sion are concerned largely with whether the manufacturer lives up
to the labor provisions of the code. We have not attempted to enforce
(*) Letter dated August 29, 1934, to John R. Beecroft, Assistant
Deputy Administrator, from Ge.orge L. Bell, Executive Director,
Hen's Clothing Code Authority. (Men's Clothing Code Files.)
(**) Letter dated September 15, 1934, from II. D. Vincent, Assistant
Deputy Administrator, to Code Authority. (Men's Clothing Code
Piles.)
9782
the selling-below-cost provisions of the code as such." (*). At this time,
it uas reported by the Code Authority that approximately 1C6 complaints
on selling below cost had been received up to July 12, 1934.
71. DH0PF2D LUTES OR SURPLUS STOCKS
On February 8, 1755, the Code Authority advised the N.H.A. Textile
Division that inasmuch as the Code Authority's cost formula had not been
approved, the Code Authority could not proceed with its report under Ar-
ticle X with respect to dropped lines or surplus stocks.
Complirnce witn the consignment and "cut, make, and trim" clauses of
the Code have been covered in this Chapter. Nevertheless, an examination
of the total number of trade practice complaints as reported by the Code
Authority to the Washington Corroliance Office ma- r prove of some interest.
The Code Authority's report to the Washington Compliance Office for the
period fro.: September 15, 1934, to January 19, 1S35, reveals that of the
157 trade practice complaints on hand and docketed (allowing for bookkeep-
ing rejections), in 11 cases no violations had been found, 114 were re-
ported adjusted, leaving 32 on hand, none having been referred to the
Compliance Division.
As explained above, the Code Authority made no attempt to enforce
the selling below cost provisions of the Code, but used complaints re-
lative thereto as a. basis for investigating the likelihood of wage and
hour violations. Accordingly, many of the trade practice complaints
reported to the Compliance office might have shown up finally as wage or
hour complaints. The Code Authority reported on February 2, 1935, that
the bulk of old complaints, labor and trade practice, were of a jurisdic-
tional nature arising oat of conflicts with the Cotton Garment Code, the
Merchant Tailors' Code, and other Codes.
Conroliajice procedure of the Code Authority is discussed in the Chap-
ters "Code Administration Organization and Procedure" and"Labor Under
the Code."
(*) Letter dated July 12, 1934, from Hen's Clothing Code Authority to
Stanley I. posner; Compliance Division Piles.
S782
-272-
VII. PROPOSED AiJEHBLIEITOS 'TO PAIR TRADE PRACTICE PROVISIONS (Prepared
by A. Palna Aaronscn)
The Lien's Clothing Code Authority early in 1934 appointed a com-
mittee on fair trade practicec. This cora.iittee spent much time confer-
ring with the retail and wholesale groups which were directly concerned
with the practices under consideration.
The trade practices being considered and the issues involved can
"be best set forth by the following summary of the commit tee' s report to
the Code Authority on June 8, 1934.*
A. Fair Trade Practices under Consideration by Committee
on Pair Trade Practices
tL.
Committee reports that conference was held with the National As-
sociation of Wholesale Clothing Salesmen, Inc. The last named
group urged upon this Committee the necessity of emending the
Code to establish fair trade practices in the interests of sales-
men. Committee ao.vises Code Authority that it is not incumbent
upon Code Authority to act upon the petition of the Wholesale
Clothing Salesmen before a decision is made by Administrator
Johnson himself upon the matter of traveling salesmen.
This Wholesale Clothing Salesmen's Association likewise urged
upon the Code Authority the following amendment to the Code:
"It is an unfair trade practice for a manufacturer to make or
grant bonuses, discovmts or allowances of any nature to persons,
corporations or associations, organized for the purpose of se-
curing member retailers to make purchases for them and in con-
cert for a profit in return for which services such person, cor-
poration, or association are to receive or share any part of
such bonuses, discounts or allowances."
The Committee with respect to the last named proposal only com-
ments that we are not certain whether we should again take up
with the Administration a proposal that has been rejected.
The Committee on Pair Trade Practices conferred with the na-
tional Retail Code Authority regarding the following proposed
amendment to the hen's Clothing Code:
1. An amendment designed to prevent the manufacturer from op-
erating from his own loft. Giving consideration to the fact
that the manufacturer possibly did have the privilege of sell-
ing to his own employees and also allowing the manufacturer to
deliver to the customer or consumer certain merchandise on a re-
tailer' s order.
The committee advises that they see no objection to the prin-
ciple involved in this amendment but comments that many re-
tailers throughout the country do not think that such a fair
'*) Report of Committee on Pair Trade Practices, June 8, 1934. (Men's
Clothing Code Piles.)
9782
trade practice would have teeth in it. But, they would be just as
dissatisfied as they are at present if the amendment were put into
the Code.
2. It was unanimously agreed "between the two committees at least
in principle, that an amendment such as follows should be incorpor-
ated in the Code.
"If because of the imp o s i t i on of taxes, excises or governmental
charges not now existing, or new laws governing the working hours
or compensation of labor or of codes, agreements, regulations, pro-
clamations or orders made pursuant to any existing or new laws,
the cost to the seller of filling this order is increased, the buyer
agrees to pay such increased cost to the seller."
3. It was agreed between the two committees that final delivery
dates should be provided for in the Code, fixing definite dates for
spring men's three and four-piece suits, fall overcoats, spring
topcoats, and fall topcoats. It was agreed that equitable dates
.could be worked out between the two groups concerned,
4. The two committees agreed that provision should be made requir-
ing manufacturers to complete spring and summer shipments to the
house 50 days earlier than the dates agreed upon in the foregoing
proposal, and to ship at least 50 per cent of suits and topcoats
to all sections of the country 30 days prior to the final delivery
dates specified,,
5. The committees unanimously agreed that the Code should be
amended to provide that all clothing is to be sold f. o.b. from the
city of manufacture.
5. t The Men's Clothing Code Authority Committee recommends am amend-
ment to the. Code somewhat standard in character relative to the
defamation or disparagement of competing manufacturers by falsely
imputing to them dishonorable conduct, etc.
7. The Clothing Committee recommends an amendment providing that
an order is a bona fide order unless otherwise specified in writ-
ing on the face of the order at the time it is given.
8, The committee recommends that if the Code Authority agrees the
Joint Committee should set a definite limit of tine either 10, 20 or
30 days from the date an order is placed for revisions to be made.
9. , Agreed by the two committees to recommend an amendment to the
Code which would set a fixed extra charge price on special garments
made for customers. "The changes among wholesalers vary, and in
some instances retailers pay no extra charge although to cut a gar-
ment specially costs the manufacturer between 15 per cent and 20 per
cent extra."
10. Agreed by the t* T committees that there should be an amendment
requiring manufacturers to charge customers for the furnishing of
9782
-274-
labels when the cost of such labels exceeds 4 cents per label, pro-
vided that './hen combinations "manufacturer and customer" labels are
used, no charge should bo made the customer, irrespective of cost,
11. The Clothing Committee recommends an amendment to the Code pro-
viding for uniform liberal terns, within say 6 per cent for all past
due accounts. One definite suggestion made Mas: "Terms of payment
shall not exceed cash discounts of 7-10 e.o.m, from date of ship-
ment." Comment by the committee was to the fact that "we can work
out with the National Retail Code Authority the exact phraseology
of terms* We do not care to ask them to make a final determination
.in this until our Code Authority had approved on the principle of
. such an amendment."
Conferences of the nature above-indicated continued intermittently
throughout 1934. On September 14, 1934, Executive Director Bell reported
that the Pair Trade Practice Committee had conducted correspondence with
various retail organizations concerning practices which the Code Authority
had authorized presented to the Administration. Some of the practices
were favored and some not. Besides, he reported that visits to offices of
some twenty different Code Authorities were made concerning fair trade
practice provisions and their workings.
B. The Trade Practice Hearing "10-1."
Certain of the above-discussed trade practices were submitted to
the Administration, and on llovenber 20, 1934, the original notice of
hearing Ho, 10-1 was sent out. Partner notices of adjournment and ad-
ditions are as follows:*
Hot ice of Adjournment ITo. 10-1, December 1, 1934.
Hotice of Adjournment Ho. 10-1, December 29, 1934.
Supplementary Hotice of Hearing Ho. 10- I, December 31, 1934.
Supplemental Hotice of Hearing Ho. 10- I, January 11, 1935.
Revised Hotice of Hearing and Hotice of Adjourned Hearing Ho.
10-1, Superseding all previous notices, January 31, 1935.
Supplemental Hotice -of Hearing 10-1, February 9, 1935.
Hotice of Adjourned Hearing 10-1, February 21, 1935.
These several adjournments were the results of requests made by both
the retailers and manufacturers d:a.e to the Christmas holiday season, the
inventory period, the spring showing, and also due to the conflict with
the Price and Labor hearings.
Finally on April 15, 1935, a hearing was held in the Raleigh Hotel,
Assistant Deputy Administrator Walter E. Woodford, Jr., presiding.
1. The Executive Director's Statement.
Mr, Morris Greenberg, Executive Director of the Hen's Clothing Code
Authority, successor to George L. Bell, made the following statement at
the Hearing:**
(* ) Volume I of Transcript of Hearing on Hen's Clothing Industry Amend-
ment Proposal, April 15, 1935, Page 2.
(**) Volume 1, Transcript of Hearing on lien's Clothing Industry, Auril
15, 1935, Page 29.
9782
"I, this much-postponed hearing had cone off at any of the earlier
dates for which it was set, it would have been necessary for ne to
clair, much more of your tine than there is now any occasion for me
to do. For as we cone before you here, we are in the happy joosi-
tion of having secured agreement to the proposals affecting the
ready-to-wear division from the associations which comprise the.
bull: of the nation's clothing distributors.....
"We are proud, Mr. Administrator, to have achieved this triumph
of accord with the retailers of our product... fe had conferences,
repeated conferences, with representatives of the retailers' asso-
ciations, sometimes with a single official or two, sometimes with
a committee, and in those conferences we obtained the retailer's
point of view.
"...TTlien we met in Chicago Ten days ago with a committee of the
national Retail Clothiers and Furnishers, including its president,
Mr. Maurice L c Rothchild, its Executive Secretary, Mr. Allen
Sinsheimer, and several prominent members of the Association, we
were able to reach complete agreement with them in the course of a
couple of hours of extraordinarily frank and friendly give-and-
take. "
C. grade_ Pract ice Amendments Scheduled for Hearing .
A list of the fair trade practices as set down in the Notice of
Hearing "go. 10-1, November 20, 1934 is as follows:
"SCHEDULE 'A' PROPOSED AMENDMENTS TO THE CODE OF FAIR COMPETITION
FOR THE MEN'S CLOTH IITG INDUSTRY
"For all purposes of this code, the provisions hereinafter set
forth shall constitute unfair trade practices. Any member of the
industry, who shall directly or indirectly, through any officer,
employee, agent, or representative knowingly use, employ or permit
to be employed, or be engaged in any such unfair trade practices,
shall be guilty of violation of the code, and be subject to the
penalties provided in the Act. The articles of the Fair Trade Prac-
tices contained in this code shall constitute uniform conditions of
sale of the industry, and it shall be an unfair trade practice to
sell in violation of any of such trade practice regulations.
"1. No manufacturer in the industry shall accept returned merchan-
dise for credit, except for defects in materials and/or manufacture;
delay in delivers'-; errors in shipments; or non-conformity to the
specifications of the order.
"2. (a) It shall be unfair trade practice to sell merchandise at
a cash discount in excess of 7$, ten days E.O.M. (end of month), or
6,o, seventy days from date of delivery as specified in the order, or
if de liverj"- shall be made later than the date specified in the order,
then seventy days from the date of actual delivery; provided, ho\7-
ever, that an extension, not to exceed 50 days nay be granted to
buyers of merchandise for shipment to the following states; Arizona,
California, Colorado, Idaho ,.. Montana, Nevada, New Mexico, Oregon,
-27S-
Utah, Washington, and Wyoming.
"(b) Anticipation shall not be allowed, at a rate in excess of
o c i per annum.
"3. All members of the industry shall sell merchandise on the
Shipping terms of F.O.3., city of manufacture; or when a
different method of transportation, such r>s Express, parcel
post or airmail, is designated, or made necessary through no
fault of the manufncturer, such transportation cost shall
be charged to the buyer.
"4. Customer's labels shall not be supplied by the manufacturer,
but if furnished to him by the customer, the latter may be
credited with the actual cost of the label, but not to ex-
ceed two cents (2$) . Where combination 'manufacturer -and
customer' labels are used, they shall be supplied by the
manufacturer without charge to the customer.
"5. Every sales contrrct or orc'er snail contain the following
provisions:
"(a) 'Prices on the undelivered balance of this order
are subject to increase due to any Federal or State
Law taxing processed or raw materials, or decrensing
working hours or increasing compensation of labor.'
"(b N 'This order when accepted is not subject. to
. rev is.: on. or cancellation except for failure to deliver
in accordance with conditions of sale or unless so
specified on the free hereof.'
"6. Ho member of this industry shall sell his products at re-
tail unles:-: he operates a separate establishment main-
tained frr Lhis purpose and regulated by the provisions
of the Hetail Code. To constitute 'a separate establish-
ment', such an outlet must be stocked with merchandise
specifically assembled for distribution to the consuming
public, and must employ the services of one or more em-
ployees exclusively engnged in selling such merchandise
to the consumer trade.
"The foregoing prohibition of selling at retail shall not apply
to (a) the ' Tyiiors-to~the~Trade' or 'Special Order Houses' of
the ciolh'bjg industry, (b) to retail distribution of clothing
on contract bid in wholesale quantities; or to (c) the sale of
uniforms to individuals in the military or navpl establishments
of the U. S. Government , or in the uniformed departments of
any govern pent al agency; or (d) to sales made direct to the
consumer by outside salesmen or canvassers; or (e) to bona fide
sales to o manufacturer's own employees of garments for the
personal use of such employees.
"7. No garment shall be manufactured of woolen or worsted material
or of summer and washable fabrics, which have not been sponged
„ in the piece." ' > ,
9782 F
-; 77-
The original Notice -10-1, dated Novenber 20, 1934, contained no
Schedule "B", However, in the December 31, 1934, Supplemental Notice
of Hearing No. 10-1 Schedule "A" was an additional amendment proposed
by the Labor Advisory Board that requested Article VII be deleted and
the standard clause
"that every employer make reasonable provisions for the safety and
health of his employees. "
be inserted in lieu thereof.
In January 11, 1935, Notice, we find a further Labor Advisory Board
proposal that
"No person under eighteen years of age shall be employed at opera-
tions or occupations which are hazardous or dangerous to the health".
It was in the Revised Notice of Hearing and Notice of Adjournment
of the Adjourned Hearing 10-1 (Superseding all previous Notices)
January 31, 1935, that the two, above-mentioned proposals by the Labor
Advisory Board were incorporated into the Notice as Schedule "B". (*)
1. Retailers' Objections to Proposed Trade Practice Amendments.
The amendments as proposed and submitted caused a great number of
letters of protest to be sent in by retailers. The National Association
of Retail Clothiers and Furnishers published in the "National Clothier, "
a trade journal, their opinion of what the effect of the proposed amend-
ments would have upon the retail clothing merchants of the country. As
a result, a great number of letters of protest were sent to the Deputy
Administrator in charge of the Code.
A typical letter of protest is cited below: (**)
"We urgently protest proposed amendments to the clothing manufac-
turers code believing they are inequitable and unfair; that they
would increase costs to the retail clothier and lead to higher
prices to the consumer.
".The only provision taking the retailers problems into consideration
fails to give adequate protection to the retail store against manu-
facturers selling at retail,
"The provision permitting manufacturers to raise prices after con-
tracts have been made would cause great uncertainty to confusion in
the industry and '-ould make the placing of advance orders almost
impossible.
(*) Transcript of Hearing on Lien's Qlo thing Indus try, April 15, 1935,
Page 19.
(**) J. F, Gregory & Sons, Rockland, Me., to S. H. Ourbacker, Assistant
Deputy Administrator, October 31, 1934, (Lien's Clothing Code Files)
9732
-278-
"Limits of term, and discounts, label and shipping provisions would
increase costs that cannot fee borne "by the merchant' today.
"We protest these provisions most vigorously as we believe that
the average merchant has about all he can bear at the present time,"'
Those fair trade practices actually presented for consideration at
the hearing "As Revided in Conference with the National Association of
Retail Clothiers and Furnishers, April 5, 1935," are as follows: (*)
I!
"For all purposes of this Code, the provisions hereinafter set forth
shall constitute unfair trade practices* Any mcraoer of the industry
who shall directly or indirectly, through any officer, employee, agent,
or representative, knowingly use, employ or permit to be employed, or
be engaged in any such unfair trade practices, shall be quilty of vio-
lation of the Code, and he subject to the penalties provided in the
Act. The articles of the Fair Trade Practices contained in this Code
shall constitute uniform conditions of sale of the appropriate division
of the Industry, and it shall bo an unfair trade practice to sell in
violation of any such trade practice regulations.
"1. (a) No manufacturer in the industry shall accept returned mer-
chandise for credit, except for defects in materials and/or manufat-
ture; delay in delivery; errors in shipment; or non-conformity to the
specifications of the order,,
(b) The merits of each case of returns shall be determined by
the manufacturer and retailer involved; but in the event of their
failure to agree, dispute shall be referred to arbitration. Each
party to the dispute shall appoint one representative to an arbitrat-
ing committee, and agreement between them shall be binding. In case
of disagreement the two arbitrators shall select a third as referee,
and his decision shall be binding; provided, however, that returns
totalling less than $100. from a single shipment shall not be subject
to arbitration,
"2„ Customer's labels shall not be supplied by the manufacturer,
but if f irnishod to him by the customer, the -latter may be credited
with the actual cost of the label, but not to exceed four cents (4^) f
Where combination 'manufacturer and customer' labels are used, they
shall be supplied by the manufacturer without charge to the customer.
"3. Every sales contract or order shall contain the following pro-
visions
'This order is subject to the Fair Trade Practice provisions of the
Men's Clothing Code.'
"4. No member of this industry shall sell his products at retail
unless he operates a separate establishment for this purpose and
regulated by the provisions of the Retail Code. To constitute a
'separate establishment', ,s.uch an outlet must be stocked -with
(*) Transcript of Hearing on Men's clothing Industry, April 15, 1935.
Pages 32-38-54-69.
9782
-■.79-
merchandise specif ically assembled for distribution to the consuming
public, and must employ the services of one or more employees ex-
clusively engaged in selling such merchandise' to the consumer trade.
"The foregoing prohibition of selli i at retail shall r.ot ap n
to (a) the 'Tailors-to-the-Trade' or 'S ecial Order Houses' of
clothing industry; (b) to retail distribution of clothing on con-
tract bid in wholesale quantities; or to (c) the sale of uniforms
to individuals in the military or naval, establishments of the U. S.
Government, or in the uniformed departments of •, \yj governmental
agency; or (d) to sales made direct to th : consu er by outside sales-
men or canvassers; or (e) to bona fide sales to a manufacturer's
own employees of garments for the per -oral use of such employees.
"5. "_ T o men's or young men's a/ar -il sh- 11 be. manufactured of r oolen
or worsted material or of sum ier ana washable fabrics, which have
not ^OQ^n sponged in the piece."
D • Proposed Trade Practic es Sub mitted ^r Ta ilors-t o-the-Trade
e: .". ".£•: t ilers 1 O bject ions.
At the same hearing i'r. "'. C. Furscott, President, of the Kahn
Tailoring Co., Indianapolis, Dad., offeree the following amendments for
consideration; (*) to apply only " tailors- to-the-trade." a -a/or ".specirl
order houses of the lien's Clothing Industry:
"(1) Transportation charges and insurance shall be added to each
bill as a seprrate item, aid paid by the dealer. On C.O.D.
shipments, money order fees shall likewise be paid by the
dealer.
"(2) Swatch lines put out by 'tailors~to-the~trade« shall not be
larger than 77 square inches, nor shall card line samples be
larger than 33 3/8 square inches.
"(3) All samples of cloth shall b\e- so labeled as 'to show the content
of cloth so labeled.
"Fabrics labeled 'all wool' shall mean that the fabric so
labeled is 10C$ wool.
"Fabrics labeled 'wool and silk' decorations' shall mean that
the fabric so labeled shall be all wool pith the exception of
the decoration, which shall be sill:.
L'JTabricsliLabelad'wool with rayon decorations ' shall mean that
the fabric so 1 labeled shall be all wopi wi.th the exception
of the decoration, which shall be ra rr on or celanese,
"~ brics ls.be led 'wool With' cotton mercerized decorations'
shall mean that the fabric so labeled .shall be all wool with
the exception of the decoration, which shall be mercerized
cotton.
978? (*) Transcript of Hearing On Ken's Clothing Industry, April 15,
1935, Page 113.
-23C--
"All other fabrics not specifically included above and con-
taining wool and other fabric substance such as cotton, shall he
labeled 'not all wool*.
" (4-) Paying money or the equivalent of money to salesmen employed
by competing firms for the purpose of enticing them away from the
firm of their employment is hereby prohibited.
"(5) Ha cash advertising allowance shall be made to dealers, but
this provision shall not preclude the furnishing of advertising
natter for distribution either by the manufacturer or ''oy the. dealer."
A cop;- of the above-listed amendments was sent to the Executive
Director of the National Association of Retail Clothiers and Furnishers
by Assistant Deputy Administrator Waletr E. Wo'odford, Jr., requesting
consideration by them.
On April 22, 1935, the Association replied: (*)
"Than 1 : you for your letter of April 19,
"Within the past week our committee has had an opportunity
to consider the proposed fair trade practice amendments sub-
mitted by the Tailors-to-tlie-Trade group and to be added to
the ::en's Clothing Code. :
"Tie believe that, in the main, these provisions are not objec-
tionable. In large part they will prehaps be of value in im-
proving the position of the industry.
"On general principles, however, some of the members of our
Committee object to the inclusion of the word ' insurance • in
the suggested practice #1, on the theory that retailers should
have the right to say whether or not insurance shall be added
to their invoices.
"With reference to practice #5, some members of our committee
believe that cooperative advertising is a matter that should
bake care of itself — a matter that should be governed by
negotiations directly between the manufacturer and the retailer,
since all communities are not alike and all advertising condi-
tions are not the same. There inay be instances in which manu-
facturers may find it to their advantage to engage in cooperative
advertising with the retailer or retailers in a given community.
"Other than these suggestions ••'hich we lay before you, our
committee lends its approval."
(*) Letter
to Walter E. Woodford, Jr., dated April 22, 1935. Consumers"
Advisory Board Files, Central xiecords.
9782
-281-
The foregoing fair trade practices that were presented for herring
on April 15, 1.35, were never submitted to the various Advisory Boards
for their cou :ents, nor V7ere they approved by the jfeti'onal Recovery
Administra,tion.
9782
-282-
VIII. PHOFOSIH "AIP FADE ?PACTIC"S PC?. UlTI-QP: HAi^lFACTUHEHS (Pre-
pared 'by A. Falma Aarongon)
The national Association 01 Uniform ; ^.nufacturers was formed some
time prior to the date the National Industrial Hecovery Act was passed
"by the Congress of the United States oi America.
Immediately after its formation, tiie Association drew up a set
of fair trade practice rules which were submitted to the Federal
Trade Commission. Some of tiie fair trade practices v;ere approved and
some rejected by the Commission. These rules were never made effective
"because oi the ado tion by Congress of recovery legislation. The
Association, upon approval of the Act, made application for approval
of a Code of Pair Competition for the Uniform Manufacturing Industry
with its accompanying fair trade practice section.
After the hearing, the Association agreed to a merger with the
Hen'? Clothing Industry Code am a section malrin,; special provision
for administrative autonomy for uniform manufacturers under the lien's
Clothing Code Authority was written into the Code as Section XVI: (*)
"The Men's Clothing Cede Authority shall o.esignate the national
Association of Uniform Manufacturers to aid the Administrator in
the administration of this Code in rcsnect of the manufacture
and distribution of uniform apparel and shall make recommendations
to the Administrator in respect of the trade practices desirable
for that branch of the industry."
In a letter to Dr. Lindsay Rogers, Deputy Administrator, written
by Harold 77. Schwab, Executive Secretary of the National Association
of Uniform Manufacturers, July 28, 1933, is a "Summary of Association
Protests Establishing lifferences Uniform vs. Clothing Industry,"
for the purpose of providing the essential data describing the basic
differences existing between the Uniform Apparel Manufacturing Industry
and the Men's Clothing Industry." ('**)
The following comments refer to that part of the letter concern-
ing fair trade practices only. (National Association of Uniform
Manufacturers Code as compared with Hen's Clothing Code.)
"Article IV — Labels, protests against use of same labels as
Men's Clothing Code Authority. Asks for own distinctive labels.
Article IX — Sales below Cost. Associations' system varies from
Code, due to additional items, as special designing, sketching,
higher wages, slower production, and uniform accessories."
The Summary also points out that the Men's Clothing Code does not
contain a ny fair trade practices providing for terms of sale, substitu -
(*) Men's Clothing Code.
(**) Letter dated July 28, 193S, frorn Harold 77. Schwab , ■Executive
Secretary, National Association of Uniform Manufacturers, to Dr.
Lindsay Rogers, Deputy Administrator, (item's Clothing Code Files).
9782
-283-
tion of product?, misbrahdi . , pir by of 6 isi a, commercial briber' ', "
. t Unifori : rcrs ar vitl 'ecial probli s
that • . ,; jturers of men's clothing are not, and t ore ask that
'due to the following evils, which 'ore steadily increasing, they pro-
vide:
"1. That secon - L or obsolete unifor: c lot be accepted
rt of the purchase price of new uniforms.
" .:. That a manufacturer cannot as s co sider; tion to or induce-
ent for a sale, agree to service , press, or retailor the uniform
throughout its life.
"Z. That uniforms cannot be altered, cleaned; or pressed be lev
cost.
B-'.-. Uniforms cannot be 3et, hired, or rented by a manufacturer.
"5. To enter into an agreement with a mill to disguise a certain
f .brie so that the mill will ask a higher rice for it of com-
petitors .
■ o. To have a police department or any purchaser specify a
"(
fabric for its uniforms unltnown to other uniform manufacturers.
"7. To sell for resale to another who violates the terms of our
Code.
"This is a very important provision, as often retailors
compete direct!" with the manufacturers.
"'"e feel that we need, in general the following provisions
and nave provided accordingly:
"(1) In regard to false ana misleading statement?.
"(2) Espionage.
"(3) Imitation to competitor's marks.
11 (4) Repudiation of contracts.
"(d) Inducing breach of contract.
11 (6) Defamation of competitor and disparagement of his pro-
ducts .
"The Executive or Control Committee of the 'Clothing Manufacturers,
in particular, coraposi i ai ily of civilian clothing men, totally
unfamiliar with the Uniform Industry, would be called upon to
decide on technical production - i istributive problems about
which they knew little or nothing. What possible aid or control
could they exercise in the circumstances? Ch »s and confusion
would inevitably result in the Uniform Industry.
"In general, it 'will prove disastrous to us if we have to submit
confidential data and vital statistics which represent our life-
time's,, experiences to another industry that competes with us and
we not with it."
9782
Harold W, Schwab, Executive Secretary of the Uniform ilanufactur-
£!§ Assqciation, submitted a list of fair trade practices to
esistant Deputy Administrator John R. Beecroft, under date of
August 31, 1954, with a request that a public hearing he held "at
earliest possible moment." (*) The letter reads in po.rt as follows:
"By approval of Mr. George Bell, Executive Director, of the lien's
Clothing Code Authority, we are submitting herewith a list of
trad.e practices which have been approved by the Lien's Clothing
Code Authority for submission to you to be added to the Men's
Clothing Code, when and if approved by the N.R.A. , under the
terns of Article XVI, and applicable only to the manufacture of
vni forms.
"If the lien's Clothing Code Authority have madde application for
any similar trade practices to be added to the Cod.e, we will
accept their ">ractices and withdraw ours."
The tra.de practices approved by the Men's Clothing Code Authority
for submission to the H.R.A. under the provisions of Article XVI of
the Men's Clothing Code, are:
(Applicable to Uniform Manufacturers only)
"1. To sell accessories below cost; cost shall include a fair
percentage to cover all overhead.
"2. To sell obsolete or misfit uniform apparel in excess of 3'"j
of the annual sales in the preceding calendar year or more than
$5,000.00 in amount in any one ye " r at prices necessary for
disposal. Sales exceeding the stated amounts must be reported
to the national Association of Uniform M-nufacturers prior to
disposal below cost.
"3. To cut and make Liniform apparel, excepting shirts, or
blouses, from fabrics, trimmings and/or other materials furnished
by or ordered on the credit guarantee of the buyer excepting on
Federal Government contracts.
"4. Substi tilt ion of one proci.uct for another . Shipping or
delivering of products which do not conform to the samples sub-
mitted or the specifications prescribed or representations made
prior to the securing of orders without the consent of the pur-
chaser thereto.
"5. Terns: To sell uniform apparel as herein ciefineo. and/or
accessories upon terms other than a maximum of thirty days net,
or the allowance of a discount in excess of one per cent for cash
payment within ten days from the date of shipment, provided,
however, that on direct sales by m?nufacturer to the consumer
an additional period not in excess of 90 days, may be allowed
. the_jQurchaser for the payment of invoices.
(*) Letter from Harold W. Schwab, Executive Secretary, National
Association of Uniform Manufacturers, to John R. Beecroft, Assistant
Deputy Administrator, dated August 31, 1954. (Men's Clothing Code Files).
9782
-285-
"6. To offer for sale merchandise at a price re-
duced from a marked-up or fictitious price, with
the tendency and capacity to mislead or deceive pur-
chasers or prospective purchasers.
"7, Secret Rebates : The secret payment or allow-
ance of rebates, refunds, commissions, or unearned
discounts, whether in the form of money or otherwise,
or secretly extending to certain purchasers special
services or privileges not extended to all purchasers
under like terms and conditions.
"3. Misbranding . Falsely marking or branding of
products of the industry with respect to the
quality, quantity, grade, or substance of the
goods purchased.
"9, False or Misleading Statements . Making or
causing or permitting to be made or published, any
false, untrue, or deceptive statement, in the
form of advertisement or otherwise, concerning
the grade, quality, quantity, substance, char-
acter, nature, origin, size, or preparation of
a.ny product of the industry.
"10. Enticing Employees . To maliciously entice
the employees of competitors, with the purpose
and effect of unduly hampering, injuring, or em-
barrassing competitors in their business.
"11. Imitation of Competitors' I&irks. To imi-
tate the labels, trade marks, trade names, slo-
gans, cr other marks of identification of com-
petitors.
"12. Espionage . To secure information from com-
petitors concerning their business by false or
misleading statements or representations, or by
false impersonations of one in authority, and by
the wrongful use thereof, to unduly hinder or
stifle the fair competition of such competitors.
"13. Commercial 3ribery . Directly or indirectly
to give or permit to be given or offer to give
money or any thing of value to agents, employees,
or representatives of customers or prospective
customers, or to the agents, employees, or repre-
sentatives of competitors' customers or prospec-
tive customers, without the knowledge of their
employers or principals, as an inducment to in-
fluence their employers or principals to purchase .
or contract to purchase industry products from
9732
-286-
the maker of such, gift or offer, or to influence
such employers or principals to refrain from deal-
ing or contracting to deal with competitors.
"14. To maliciously induce or attempt to induce
the breach of existing contracts between competi-
tors and their customers by any false or deceptive
means whatsoever, or to interfere with or ob-
struct the performance of any such contractual
duties or services by any such means.
"15. Defamation of Co mpet itor and D isparage-
ment of Products . To defame competitors by
falsely imputing to them dishonorable conduct,
inability to perform. contracts, questionable
credit standing, or by other false representa-
tions to disparage the grade or quality of a
competitor's goods.
"16. Confined Fabrics.
(a) To enter into an agreement with a mill
to disguise by any special number any standard
or special fabric known generally to the trade
by a given number and to establish for the
fabric identified by the disguised number
a price in excess of the current established
price for the fabric identified with a number
by which it is generally known to the trade.
(b) To induce a contractee or purchaser
to use and apply in specifications a number to
denote a style of fabric upon which bidding
shall be let publicly, which number is not generally,
used and known to the members of this industry,',
to denote a known fabric, unless immediately
following the date upon which the manufacturer
has obtained the consent of the contractee to
specify the aforesaid number and said manu-
facturer (l) submits in writing to the na-
tional Association of Uniform Manufacturers
the name of the mill manufacturing the product
and full information concerning the style thereof,
and (2) unless such uniform manufacturer shall,
as aforesaid in writing, inform the mill that
it may, upon the same price and terms and deliv-
eries, without recourse, liability, or other
obligations, quote to all manufacturers bidding,
the same price, terms, and/ or delivery, and fur-
nish the said fabric to the successful bidder
whomsoever he, or it may be. .
"17. Piracy of Design . To adopt for one's own
use, by photostatic, photographic, or other means
9782
-267-
of reproduction, the plates, cuts, or other il-
lustrations contained in catalogues, publications,
measure "boohs, folders and/or "blanks originated
by a competitor.
''18. For a manufacturer of uniform apparel,
v.'here two or mere manufacturers have been asked
to bid, to submit to a prospective purchaser
samples of uniform apparel made specially for
or to the specifications of a prospective buyer,
unless paid for, where the manufacturer has;
reason to believe or can ascertain that the
total quantity of uniform apparel required by
the purchaser rill not exceed one hundred units;
provided, however, that after 'the successful
bidder has been ascertained, he may furnish
the necessary sample garments,
"19. To charge less than cost for services
rendered to a customer for pressing. . cleaning,
re-building, repairing, or rc-taiZoring uniforns.
"20. To accept uniforms of discontinued or ob-
solete styles ?r old and socond-hr.nd uniforms
in part consideration for the purchase price of
newly manufactured uniforms, or for merchandise
credit or cash.
"21. As a consideration to or inducement for a
sale, to service, press, renovate, or re-tailor,
throughout the life of the uniform. ;
"22. Tc alter and re-build or repair, below cost
old uniforms so that the same will be adaptable
for use by persons of size' other than those for
whom their use was originally intended.
"23. By agreement t^ accent "for" merchandise or
cash credit, or for e;<:chan e, uniform "apparel as
herein defined and/or accessories thereto if
once paid for by the "buyer.
"24. To manufacture any of the articles defined
as. "uniform apparel" and to let, and/or rent the
sa;;.e to anather.
"25. Repudiation of contracts. To repudiate
contracts whether written or oral are business
obligations impressed with legal and moral re-
sponsibilities and are not to "be repudiated by
either buyers,' sellers, and/or employers.'
"26. For any person, firm, or corporation
9782
-288-
knowingly to aid or 'a"bet another in the use
of unfair trade practices'."
It was the opinion of Assistant Deputy Administrator M, D.
Vincent (*) that the foregoing fair trade practices were "almost
without exception applicable to the entire Men's Clothing In-
dustry," and he had suggested to Executive Director of the Men's
Clothing Code Authority that fair trade practices "be adopted
by that body to be applicable to the entire Men's Clothing In-
dustry. The Assistant Deputy Administrator saw the possibility
that some of the practices would be applicable to the uniform
manufacturers only, but that these could be considered at the
same hearing as the generally-applicable provisions.
A brief comment on each of the 26 fair trade practices
submitted was made by the Assistant Deputy Administrator at
the same time.
On the same date, Assistant Deputy Administrator Vincent
in a letter 'to George L. 3ell, Executive Director, Men's
Clothing Code Authority, made the statement that "The present
trade practice provisions appearing in the Men's Clothing
Code seem to be inadequate," and asks to have the Code Author-
ity's reaction to the submitted trade -oractices for the uniform
manufacturers. He also mentions the fact that these (the uniform
manufacturers') trade practice almost without exception would
apply to the other members of the Men's Clothing Industry.
The national Association of Uniform Manufacturers peti-
tioned the N.H.A. on October 26, 1934, (**) requesting an
interpretation of Article XVI of the Men's Clothing Code to
the end that the policies and purposes of the National Recovery
Act be made more effective by giving the uniform manufacturers
autonomy. The Petition contains 41 paragraphs, each paragraph
setting forth some general information concerning the Uniform
Manufacturers Association, i. e., (l) representing 95,'j of the
total production of uniform manufacturers, (2)' that of the 130
manufacturers specializing in uniforms, 99 are members of the
Association, representing 81.7$o of the volume of production, etc.,
and a running account of the Code 'as it pertains to the Uniform
— ttv— >-* — »
(*) Letter dated September 25, 1934, from M. D. Vincent, Assistant
Deputy Administrator, to Harold W. Schwab, Executive Director,
National Association of Uniform Manufacturers. (Men's Clothing
Code Files.)
(**) Petition of National Association of Uniform Manufacturers.
(Men's Clothing Code Files, under Uniform Manufacturers.)
9782
-23C-
Manufacturers in its attempt to secure autonomy under Section XVI,
and its difficulties v/ith civilian manufacturers who occasionally
manufacture uniforms. Further, that the Association had secured
>roval "by the Federal Trade Coi.imission of twenty-four fair trade
practices to which civilian clothing manufacturers were not com-
plying; also objected to the charge for labels ($5.00 ->or K)
by the Men's Clothing Code Authority, stating that it was not
sufficient to operate the Uniform Manufacturing subdivision of
the Men's Clothing Code, requesting that the charge of $10.30 per
M for regular uniform labels and $15.00 per M for the special order
labels be made.
In connection with the foregoing, attention is directed
to the recommendations of the Special Committee on Uniform
Manufactv.rers, Branch of the Men's Clothing Industry. (*)
"3. That the enforcement of the trade practice
provisions of the uniform mr.nufacturers ' branch
of the industry be carried on by the Uniform Manu-
facturers Association, since they -?re proposing
a number of separate trade practices applicable
only to their branch of the industry „ Out of the
income frtrn the sale of uniform labels, tne Men's
Clothing Code Authority will pay monthly to the
. Uniform Manufacturers Association s reasonable
amount for the cost of enforcing trade practice
provisions. If the Code Authority and the Uniform
Manufactxirers Association cannot agree upon what
is a reasonable amount for this ;uirpose, the amount
should be determined by the Administrator.
"4. Tit. t'the amendment to the Men's Clothing Code
proposed by the Uniform Manufacturers Association
to grant more or les3 com 'let e autonomy to the
uniform manufacturers' branch of the industry be
denied by the Administrator. The Ccmmittue believes
that effective code r nforcument demands that there
should be more centralization rather than decentra-
lization. So far as the actual provisions of the
Code are concerned, the Committee feels that its
proposals regarding charges for labels and methods
of enforcement of the labor ^revisions and trade
practice provisions could be made effective ~oy the
Code Authority since these moot questions have heen
brought to the attention of the Ac-ministration, and
since all actions of the Code Authority are subject
to review by the .Administration, it is felt that
(*) See grdiibit "I" — Recommendation of Special
Committee, September 6, 1934, signed by 3. H.
C-itchell, Chairman. (Men's Clothing Code files.)
9782
-290-
thcse matters should be submitted to the Adminis-
tration for approval before formal action is taken ■
by the Code Authority."
- Attention .is called by B. H. Gitcholl as Chairman of the
Special Committee to the fact that one member, Mr. L. A. Hirsch,
did not vote on the recommendations as he was in Europe and had
attended only the first meeting of the Committee.
Mention has been made above of the twenty-four traie prac-
tices that were approved by the F G deral Trade Commission, ef-
fective March 16, 1934.
•
In a release for newspapers for March 13, 1234, the Federal
Trade Commission announced the approval of fifteen trade prac-
tice conference rules and nine others were accepted by the Com-
mission as expressions of industry policies.
By approval, it is understood that the Federal Trade bom-
mission is of the o-oinion that the several trade practices
"setting forth principles of law are enforceable" by the
Commission.
By acceptance is meant (in Federal Trade Commission
parlance) that the industry has expressed itself, before the
Commission, as believing certain practices ethical and desir-
able. Failure to comply with the accepted practices, however,
is not a violation of la?/.
In its statement to the Industry, the Commission includes
the following paragraph. (*)
"The Commission has directed that notice bo given
that in referring to or quoting trade practice
conference rules, the form in which they appear
in the Commission's Official Statement should be
followed with reference to 'wording, grouping,
numbering and lettering."
The National Association of Uniform Manufacturers submitted
to the Administration a list of Fair Trade Practices applicable
only to uniform manufacturers, ancte petitioned for an early hear-
ing. (**) This was evidently done in order to comply with the sug
(*) Statement by the Commission, Trade Practice Conference,
Manufacturers of Uniforms, March 15, 1934.
(**) Petition and letter to Dean G,. Edwards, Deputy Administrator,
from National Association of Uniform Manufacturers, dated Novem-
ber 7, 1954. (Men's Clothing Code files.)
9782
gestions made "by Assistant Deput; Administrator i. : . D. Vincent
in Ms letter of September 25, 1934, mentioned above, that the
Men's Clothing Code Authority submit its reactions to the
proposed fair trade practices, as he (YJ icent) thought them
applicable to "both branches of the Industry.
Then, on January 29, 1935, after the national Association
of Uniform Manufacturers had proposed a supplementary Code to the
Men's Clothing Industry Code, 3. K. Gitchell, the Administration
Member of the Men's Clothing Code Authority, advised Acting Assis-
tant Deputy Administrator S. H. Ourbacker that the Men's Clothing
Code Authority had formally disapproved the pro >oae<? supplementary
Code to the Men's Clothing Code submitted by the national. Association
of Uniform Manufacturers, paying that the Code Authority ratified
the report of the Special Committee that had studied the subject.
This report recommended that the enforcement of the labor, provi-
sions affecting uniform manufacturers be taken over by the Men's
Clothing Code Authority staff and only the enforcement of fair
trade pra.c»icos applying to uniform manufacturers be handled by
their Association.
He also recommended that the fair trade practices for-
mally submitted by the national Association of Uniform Manufac-
turers be submitted for hearing and determination by the Adminis-
tration at the same time that the~general fair trade practices
applying to the entire industry are taken up for consideration.
A . Fair T rade F r acticos for Uniform Manufacturers approved
by Pcci-rral T rac e Commission .
A comparison of the fair trade practices as submitted by
the ITational Association of Uniform Manufacturers as compared
with those practices approved or accepted by the Federal Trade
Commission is hereinafter set forth.
PROPOSED UHA TRADE PRACTICE COMPARABLE F.T-C. TRADE PRAC-
110. 1. TICE RULE, CROUP 1, PULE 1.
Trade Practice Prohibited)
To sell accessories below cost; Selling uniforms or accessor-
cost shall include a fair per- ies below cost with the intent
centage to cover all overhead. and with the effect of injuring
a competitor and where the ef-
(As suggested, we hereby with- feet may be to substantially
dravr our proposed 1T.R.A. Trade lessen competition or tend to
Fractice Ho. 1 and in its stead, create a monopoly or to unrea-
offer the F. T. C. Trade Era ctieu= sonably restrain trade is an
Group 1, Rule 1.) unfair trade practice.
9782
^ya-
As
(This rule was submitted, to the
Federal Trade Commission and de-
nied on the grounds that it was
contrary to the antitrust laws.
suggested, we have stricken out
the words "National Association
of Uniform Manufacturers "and in-
serted the words "Code Authority. 11 )
PROPOSED 1IRA TRADE PRACTICE
110. 2.
(Trade Practice Prohibited)
To sell oboslete or misfit
uniform apparel in excess of
3,j of the annual sales in the
preceding calendar year or
more than $5,000.00 in amount
in any one year at rj rices
necessary for disposal. Sales
exceeding the stated amounts
must be reported to the Code
Authority prior to disposal
below cost.
PROPOSED ITPA TRADE PRACTICE
HO. 3
(Trade Practice Prohibited)
To cut and make uniform apparel, (This rule was submitted to the
excepting shirts, or blouses, from Federal Trade Commission and de-
fabrics, trimmings and/or other nied on the grounds that it was
materials furnished by or ordered contrary to the antitrust laws,
on the credit guarantee of the
buyer excepting on Federal
Government contracts.
PROPOSED NRA TRADE PRACTICE
NO. 4
(Trade Practice Prohibited)
Ship-->in b or delivering of pro-
ducts which do not conform to
the samples submitted or the
specifications Trescribed or
representations made -orior to
securing of orders without the
consent of the purchaser
thereto.
COMPARABLE F.T.C. TRADE PRAC-
TICE RULE, GROUP 1, RULE 2. ■
The practice of shipping or de-
livering products which do not
conform to the samples submitted
or representations made -:>rior to
securing the orders, without the
consent of the purchasers to such
substitutions, and with the ef-
fect of deceiving or misleading
purchasers, is an unfair trade
practice*
PROPOSED 1TRA TRADE PRACTICE
ITO. 5
(Trade Practice Prohibited)
To sell uniform apparel as here-
in defined and/or accessories
upon terms other than a maximum
of thirty days net, or the allow-
ance of a discount in excess of
one per cent for c a sh payment
within ten days from the date of
(This rule -.as submitted to the
Federal Trade Commission and de-
nied on the grounds that it was
contrary to antitrust laws.
9782
-39;
shipment, provided, however, that
on direct sales by manufacturer
to the consumer an additional
period, not in excess of ninety
days, may be allowed the pur-
chaser T "or the payment of
invoices.
PROPOSED NBA. TRADE PRACTICE
" lTo. 6. '
(Trade Practice Prohibited)
To offer for sale merchandise at
a price reduced from a marked-up
or fictitious price, with' the
tendency and capacity to mislead
or deceive purchasers, or pros-
pective' purchasers.
COMPARABLE F.T.C. TRADE PRAC-
TICE RULE, GROUP 1, RULE 13. -
Offering for sale merchandise at
a Trice reduced from a marked-up
or fictitious price, with the
tendency and capacity to mislead
or deceive' purchasers or pros-
pective purchasers, is an unfair
trade practice.
PROPOSED TRA TRADE PRACTICE
Ho. 7,
C0LPARA3LE F.T.C. TRADE PRAC-
TICE RULE, GROUP 1, RULE 3.
No member of the industry' shall se-
cretly offer or make ar L y payment
or alio van ce of a ret? l e, re: fund,
commisEZ'.u cr;
nefe.meo. dis-
count or c::cess allowance, whether
in the form of money , >r otherwise,
nor shall a mam! er of the industry
secretly offer a'r ertend to any
customer any S] ~.:\:1 privilege
or service not extended to
all customers of the same class
for the purpose of influencing
a sale.
The secret payment or allowance
of rebates, refunds, commis-
sions, or unearned discounts,
whether in the form of money or
otherwise, or secretly eztend-
ing to certain purchasers
spec al services or privileges
no t witendod to all purchasers
under like terras and conditions,
with the intent and with the ef-
fect of injuring a competitor
and where the effect may be to
substantially lessen competi-
tion or tend to create a monopoly
or to unreasonably restrain trade,
is an unfair trade practice.
PROPOSED NRA TRADE PEACTICI
No. 8.
COMPARABLE F.T.C. TRADE PRAC-
TICE RULE, GROUP 1, RULE 4.
No member of the industry shall
brand or mark or pack any goods
in any manner which is intended
to or dues deceive or mislead
purchasers with respect to the
brand, grade, quality, quantity,
origin, size, substance, character,
rature, finish, iraterial content
or preparation of such goods.
9782
The false marking or branding
of products of the industry,
with the effect of misleading
or deceiving purchasers with
respect to quantity, qual-
ity, grade or substance of the
goods purchased, is an unfair
trade practice.
■294-
PROPOSAL ERA TRADE PRACTICE
ilo. 9.
(Trade Practice Prohibited)
Making or causing or permitting
to be made or published, ary false,
untrue, or deceptive- statement, in
the form of 'advertisement or other-
wise, concerning the grade, quality,
quantity substance, character, na-
ture, origin, size or preparation:
of any product of the industry. >
PROPOSED ERA TRADE PRACTICE
Ho. 10
(Trade Practice Prohibited)
To imitate the labels, trade marks
trade names, slogans, or other
marks of identification or com-
petitors.
PROPOSED ERA TRADE PRACTICE
ITo. 11.
(Trade Practice Prohibited)
To secure information from com-
petitors concerning their business
by false or misleading statements
or representations, or by false im-
personations of one in authority,
and by the wrongful use thereof, to
unduly hinder or stifle the fair
competition of such competitors.
PROPOSED ERA TRA3 E PRACTICE
ilo. 12.
No member of the industry ahall
give, or permit to be given, or of-
fer to give, anything of value for
the purpose of irflTiencing or re-
warding the action of any employee,
agent, or representative in rela- .
tion to the business of the employer
of such employee, the principal of
such agent or the represented party,
without the knowledge of such em-
COiJF ARABLE F. T. C. TRADE PRAC-
TICE RULE, GROUP 1, RULE 5.
The making, or causing or per-
mitting to be made or published, of
any false, untrue, or deceptive
statement, by way of advertisement j
or otherwise, concerning the grade,
quality, quantity, substance,
character, nature, origin, size or
preparation of any product of the
industry, having the tendency and ■
capacity to mislead or 6.eceive pur-
chasers or prospective purchasers,
is an unfair trade practice. ;
COLD? ARABLE E. T. C. TRADE PRAC-
TICE RULE, GROUP 1, RULE 7.
The imitations of the trademarks
trade names, slogans, or other
marks of identification of com-
petitors, having the tendency
and capacity to mislead or de-
ceive purchasers or prosi^ective
purchasers, is .an unfair trade
practice.
COMPARABLE E. T. C. TRADE PRAC-
TICE RULE, GROUP 1, RULE 8.
Securing information from compet-
itors concerning their busi-
nesses by false or misleading
statements or representations,
or by false impersonations of
one in authority, or the wrong-
ful use thereof to unduly hin-
der or stifle the competition
of such competitors, is an un-
fair trade practice.
COMPARABLE F. T. C. TRADE PRAC-
TICE RULE, GROUP 1 RULE 9.
Directly -or. indirectly to give
or permit to be given or offer
to give money or anything of
value to agents, employees, or
representatives of customers or
prospective customers, or to
agents, employees, or represen-
tatives of competitors customers
or prospective customers,
without the knowledge of their
9782
-295-
ployer, principal, or party. This
provision shall not be construed to
prohibit free and general distribu-
tion of articles commonly used for
advertising except so far as such
articles are actually used for com-
mercial bribery as hereinabove
defined.
PROPOSED PA TEAL:
No* 13
PRACTICE
No member of the industry shall
wilfully induce or attempt to in-
duce the breach of existing con-
tracts between competitors and their
customers by any false and deceptive
means, or to in x - fere with or ob-
struct the perfc.".ance of any such
contractual duties or services by
any such means, for the purpose of
hampering, injuring or embarrassing
corroetitors in their businesso
PROPOSED ERA TRADE PRACTICE
No. 14
No member of the industry shall defame
a competitor by falsely imputing to
him dishonorable conduct, inability
to perform contracts, questionable
credit standing, or by other false •
representations or by falsely dispar-
aging the gre.de or quality of his
goods.
PROPOSED NBA TRADE PRACTICE
No. 15 (a)
(Trade Practice Prohibited)
To enter in bo an agreement with a mill
to disguise by any special number any
standard or special fabric, knovn gen-
erally to the trade by a given number
and to establish for the fabric iden-
tified by the disguised number a ■
price in excess of the current es-
tablished price for the fabric iden-
tified with a number by which it is
generally known to the. trade.
employers or principals, as an
inducement to influence ■ their
employers or principals to pur-
chase gift or offer, or to in-
fluence such employers or prin-
cipals to refrain from dealing
or contracting to deal with com-
petitors, is an unfair trade
practice*
COMPARABLE EcT„C. TRADE PRAC-
TICE RULE, GROUP 1, RULE 10.
Maliciously inducing or attempt-
ing to induce the breach of ex-
isting contracts between competi-
tors and their customers by any
false or deceptive means whatso-
ever, or interfering with or ob-
structing the performance of any
such contractual duties or ser-
vices by any such means, with the
purpose and effect of unduly ham-
pering, injuring, or embarrassing
competitors in their businesses,
is an unfair trade practice.
COLiPAEABLE
TICE RULE,
PoT.C. TRADE PRAC-
GROUP 1, RULE 11.
The defamation of competitors by
falsely imputing to them dishonor-
able conduct, inability to perform
contracts, questionable credit
standing, or by other false repre-
sentations, or the false disparage-
ment of the grade of quality of their
goods, with the tendency and capa-
city to mislead or deceive purchas-
ers or prospective purchasers, is
an unfair trade practice.
COMPARABLE E T C TRADE PRACTICE
RULE, GROUP lj RULE 12.
Conspiring with a manufacturer to
disguise by any special number any
standard of special fabric known
generally to the trade by a given
number, and to establish for the
fabric identified by the disguised
number a price in excess of the
current established price of the
fabric identified by the number by
which it is generally known to the
3732
-296-
trade, for the purpose of deceiving
purchasers intonfche belief that they
are purchasing a superior fabric
when such is not a fact, is ah unn
f ai r t ra de v> r a c t i c e.
PROPOSED KRA TRADE PRACTICE
Ho. 15 (b).
(Trade Practice Prohibited)
To induce e, contractee or purchaser
to use and apply in specifications
a number to denote a style of fab-
ric upon which bidding shall be let
publicly, which number is not gene- *
rally used and knov/n to the members
of this industry, to denote a knovm
fabric, unless immediately following
the date upon which the manufacturer
has obtained the consent of the con-,
tractee to specify the aforesaid num-
ber and said manufacturer (l) submits
in writing to the Code Authority the
name of the mill manufacturing the
product and full information concern-
ing the style thereof, and (2) unless
such uniform manufacturer shall, as
aforesaid in writing inform the mill
thai it may, upon the same price end
terms and deliveries, without re-
courje, liability, or other obliga-
tions, quote to all rnanuf- cturers
bidding, the same price, terms, and/
or delivery, and to furnish the said
fabric to the successful bidder whon-
soever he, or.it may be.
PROPOSED ERA. TRADE PRACTICE
Eo. 16.
( Traac. Practice Prohibited)
To adopt fcr one's own use, by photo-
static, photographic, or other means
of reproduction, the plates, cuts,
or other illustrations contained in *
catalogues, publications, mea-sure
books, folders and/or blanks origin-
ated by a competitor.
PROPOSED ERA TRADE PRACTICE
No. 17.
(Trade Practice Prohibited)
For a manufacturer of uniform ap-
parel, where two or more manufac-
turers have been asked to bid,, to
submit to a prospective purchaser
COI.IPARABLE P. T. C. TRACE PRAC-
TICE RULE, GROUP 1, RULE IS,
Eor a, uniform manufacturer to in'-
duce a contractee "or purchaser 1 '
to use and apply in specifica.-
ti.ns a number to denote a style
of fabric upon which bidding
shall be let publicly, which num-
ber is not generally used and
known to the members of the industry
to denote a known faibric, with the
.intent and purpose of deceiving
competitors as to the style, qual-
ity, and source of the fabric, and
withholding other necessary informa-
tion to enable competitors to in-
telligently bid on the contract,
is an unfair trade prac+ice.
COMPARABLE P. T. C. TRACE PRAC-
TICE RULEi 'GROUP 2, RULE 3. '
To adopt for one's own use, by photo-
static, photographic, or other means
of reproduction, the plaies, cuts, or
other illustrations contained in catar
logues-, publications, mea.sure books,
folders, and/or blanks originated by
a competitors, is condemned by the
industry.
COS a' ARABLE F, T. C TRADE PRAC-
TICE RILE, GRCUP 2, RULE I.
The industry condemns the prac-
tice of a manufa.cturer of uni-
form apparel, where two or more
manufacturers have been asked to
9782
-' ~7~
samples of uniform apparel made
specially for or to the specif ica-
tions of a prospective "buyer, unless
paid for, where the manufacturer has
reason to "believe or can ascertain
that the total quantity of uniform
apparel required "by the purchaser uill
not exceed one hundred units; provided,
however, that after the successful
"bidder has "been ascertained, he may
furnish the necessary sample garments*
bid, of submitting to a prospec-
tive purchaser samples of uni-
form apparel made especially for
or to the specifications of a
prospective buyer, unless paid
for, where the manufacturer has
reason to believe or can ascer-
tain that the total quantity of
uniform apparel required by the
purchaser uill not exceed one
hundred units; provided, however,
that after the successful bidder
has 'oeen ascertained, he may fur-
nish the necessary sample garments.
PROPOSED ERA TEASE PRACTICE
No. 18.
(Trade Practice Prohibited)
To charge less than cost for ser-
vices rendered to a customer for
pressing, cleaning, re-building,
repairing, or retailoring uniforms.
This rule was submitted to the
Federal Trade Commission and de-
nied on the grounds that it was
contrary to antitrust laws.
PROPOSED ERA TRADE PRACTICE
Eo, 19.
(Trade Practice Prohibited)
To accept uniforms of discontinued
and obsolete styles or old and sec-
ond-hand uniforms in part considera-
tion for the purchase price of newly
manufactured uniforms, or for mer-
chandise credit or cash.
Tliis rule was submitted to the
Federal Trade Commission and de-
nied on the grounds that it was
contrary to antitrust laws.
PROPOSED ERA TRADE PRAC m ICE
.No. 20.
(Trade Practice Prohibited)
As a consideration to or inducement
for a sale, to service, press, reno-
vate, or retailor, throughout the
life of the uniform, unless an ade-
quate charge is made therefor.
This rule was submitted to the
Federal Tra.de Commission and de-
nied on the grounds that it was
contrary to antitrust laws.
PROPOSED E?A TRADE PRACTICE
No, 21
(Tra.de Practice Prohibited)
To alter end re-build or repair,
below cost, old uniforms so that
the same will be adaptable for
use by persons of size other than
those for whom their use was ori-
ginally intended, provided, how-
ever, the new made to measure shall
be altered to the customer's satis-
faction without charge.
COI.IFARABIE F«T„C. TRADE PRAC-
TICE RULE, CROUP 2, RULE C.
Altering, repair
old uniforms so
be adaptable for
size other than
said uniforms we
tended, and sell-
disclosing that
by the industry.
ing, or rebuilding
that the same will
use by persons of
those for whom the
re originally in-
ing same without
fact, is condemned
9782
-298-
PROPOSED ERA TRADE PRACTICE
Ho. 22.
(Trade Practice- Prohibited)
By agreement to accept merchandise
or cash credit, or for exchange,
uniform apparel as herein defined
and/or accessories thereto if once
paid for by the buyer.
(As agreed, we withdraw Trade Practice
#22 and offer in its stead:)
This rule wan submitted to the
Federal Trade Commission and de-
nied on the grounds that it was
contrary bo antitrust laws.
He returned merchandise shall be
accepted for credit except by rea-
son of defects in materials and/ or
manufacture; delay in delivery; er-
rors in shipment, or non- conformity
to the specifications of the order.
No allowance shall be granted save
on the ground of the same exceptions.
PROPOSED ERA TRADE PRACTICE
xiO# CiOo
(Trade Practice Prohibited)
To manufacture any of the articles
defined as "uniform apparel" and to
This rule was submitted to the
Federal Trade Commission and de-
let, and /or rent the same to another, nied on the grounds that it was
contrary to antitrust laws.
PROPOSED ITRA TRADE PRACTICE
Ho. 24.
(Trade Practice Prohibited)
Por any person, firm, or corpora-
tion knowingly to aid or abet
another in the use of unfair trade
practices.
COMPARABLE P. T. C. TRADE PRAC-
TICE RULE, GROUP 1, RULE 14.
Por any person, firm, or corpora-
tion knowingly to aid or abet
another in the use of unfair trr.de
practices is an unfair trade practice.
There was no action taken by the National Recovery Administrate n
on these trade practices.
9782
-29 ; J-
APP3IDIX A
9782
-300-
APPENDIX A
" METHODOLOGY"
EXPLANATION' OF SCOPE OP STUDY AND
SUGGESTIONS POR FURTHER STUDY
The Men's Clothing Industry Study would scarcely "be recognized if
approached with the expectation of discovering a study "built along the
lines of the comprehensive and "idealistic" outline worked out and adopt-
ed during the "planning period.," The original outline is attached hereto
for what value it may have, either as an indication of first efforts on
the Study or as a possible aid in suggesting unexplored aspects of the
Industry. The many developments accounting for the change in the origi-
nal plan and scope of the Study will "be touched upon here as an explanation
of the final character of the Study.
The chief circumstances limiting and moulding the character of the
Study, as attempted in the Industry Studies Section of the Division of
Review, were as follows:
1. Limitations in personnel and loss of time in allocation of per-
sonnel.
2. Lack of expected cooperation from advisory and service units.
3. The necessity of acting in service and advisory capacities for
other groups in the Division and. in "being responsible for survey
of N.R.A. files.
Number 3 above was of most consequence in determining the final out-
line and character of the Study, in that investigation and research was
of necessity confined almost entirely to records and data found in N.R.A.
and other C- cvernment files. It is believed that a fairly good, survey of
the files has been made and that the result presents a fairly good picture
of the Men"' 1 -: '"'Lettin g Industry under the Cod e. True, certain secondary
sources have Leer, examined in an effort to throw light upon broad industry
characteristics r.uch as distribution, organization' of production, and labor
relations. Such efforts of necessity have been superficial and must be so
recognized.
-■egret that circumstances surrounding this Study
;•; i :" into the field to gather data on certain funda~
■ "•-_ " ; s Clothing Industry not adequately covered by
other authoritative records. Obviously, it would
: bo visit every known source of information, such as
;oJe authority records, trade unions, commercial and
scientific o: ations, experts and leading industrialists in the Industry.
A thorough study of the Men 1 s Clothing Industry or any of the larger
apparel groups would require the development and analysis of material bear-
ing upon the "subject of study" suggested below. Many of these ftmdamen-
tally important subjects were merely touched upon in the Men's Clothing
Industry Study for reasons already indicated. In many instances, however,
the importance of these subjects to a clear understanding of the Industry's
9782
It is a
??'jr>3 of
have made i ■
■- i ~. ■ .'.'■' j f~
mental aspe^ ;
. ■-'} .'■-■:
present Gove:
■■ " " .': Oj"
have been wc
. ■' "■■'...:■ c
trade associ..
n ',.. CO
-301-
characteri sties and problems is suggested in the Study. The development
of material bearing upon these "subjects of study" would in most instances
require extensive field work. Only by such field work and original inves- .
tigation could' be developed the original plan of study as indicated by the ,
attached outline entitled "Study of the Men's Clothing Industry."
Selected Subjects of -Study Not Adequately Covered by the
Men's Clothing; Industry Study
1. Inter-relations Between Suppliers of Eaw Materials and
the Manufacturers of Finished Apparel '
' '.'■ i .. ■
Little statistical information or literature exists regarding the
technique cf supplying raw materials to the apparel trades. There are
various methods of selling and purchasing raw materials but to understand
thoroughly the relative advantage of each in terms of cost and bargaining -
relationships, ' it would be necessary to go into the field and collect data ,
at the original sources. It would be necessary to visit various. manufac-
turers of raw materials and middle-men of various sorts, and manufacturers
who might employ the various methods of purchasing the raw materials, in
order to. get full and complete information about the organization of the
raw materials markets. Such subjects as ;orice, standardization, bargain
power, credit terms, etc., would be kept in mind in connection with this
field study.
2. Study of Manufacturing Technique
Code experience has taught that the technique employed in the manu-
facture of apparels is fundamentally similar throughout the various indus-
tries; however, sufficient differences exist even in one industry to make
it impossible or very difficult to cpmly sj^stems of control. Little in-
formation is' available in the records as to these differences in manufac-
turing technique. Por example, a study of the integrated shop system as
against the contract shop system as employed in the Men's Clothing Industry
would necessitate a technical examination of shops of the different types.
It would be necessary to collect data in such a case on operations, occu-
pations, and variations in productivity and cost.
3. Study of Industry Cost and Account Keeping Methods
Such a study would require visits to and consultation with account-
ants who specialize in apuarel industry problems and an examination of
systems in operation in specific plants. Likewise, there might be gathered
the results of efforts on the part of various branches of individual in-
dustries to develop accounting systems and to encourage their use within
these industries. Such a study would appear essential to a thorough under-
standing of apparel costs and would have a very definite bearing on price
systems and variations in price within the industry. Likewise, this study
would be invaluable in throwing light on wage differentials which exist in
various areas of the industry.
4. Banker (credit) - Manufacturer Relationship
In connection with the establishment of certain trade practice rules
9782
for certain of the apparel industries which were codified, it was often
asserted that lack of credit facilities or the peculiar character of those
which existed explained the development of such practices as consignment
selling and cut/ make, and trim systems, which were recognized as having
certain undesirable features. The records are not clear as to the various
credit systems which are available in the apparel industries and it would
appear, because of lack of systematized information, that visits would have
to be made to credit granting agencies as well as to borrowers to ascer-
tain the character of the credit relationship and its bearing on both manu-
facturing and selling activity,
5. Study of Large vs. Small Scale Production
It is often asserted with respect to firms in the apparel industries
as well as to firms in other industries that certain advantages are pe-
culiar to size of the plant or establishment. It is usually stated that
the small firm is at a distinct disadvantage in competing with the large
firm. It would appear to be desirable to make case studies with the view
of finding out whether or not certain decided advantages do go along with
size — the features to be kept in mind are financial stability, labor re-
lationships, and distribution methods, etc.
6. Labor Unions - Manufacturer Relationships
A considerable body of literature exists depicting the activities^
of labor unions in connection with the efforts to improve labor conditions
in various of the apparel industries; however, the I'.R.A. records are in-
complete on recent labor activity in many of the industries and do not^
satisfactorily portray the very active part which labor unions played in
operation under the codes. It would be necessary, to complete this pic-^
ture, to visit both the head-quarters of national unions and to confer with
local labor leaders and to get the benefit of such information as may be
in their files. In this connection, of course, it is essential that the
viewpoint of various manufacturers or groups of manufacturers in certain
organized areas or areas which have been subjected to the efforts of labor
organizers, be obtained.
7. Trade Association - Manufacturer Relationships
Trade associations have, for a long while, played an important part
in organized control of industry. During the N.R.A. days the influence
of trade associations increased substantially and association efforts
played a great part in both the formulation of Codes and the control of
industry under Codes. In many instances the associations have not been
recognized as Federal agencies and hence the H.R.A. files are incomplete
in reflecting trade association activity. A thorough study of trade asso-
ciation activity can be gained only by visits to the national trade
associations and especially to the local or regional trade associations
which represent group and area interests often neglected and sub-ordinated
to the greater influence of national groups. To get a clear impression of
the workings of the local association it would appear necessary to visit
areas concerned and not to rely upon second-hand information obtained from
a national headquarters group.
9782
-303-
8. Labor - Area Differentials
The groups responsible for the formation cf apparel industry Codes
almost invariably insisted that wage area, differentials should be estab-
lished. It was usually argued that such differentials were justified uoon
such general considerations as cost of living and labor efficiency. Rarely
have careful studies been made to determine whether or not these differen-
tials were justified in fact, and if justified, what area lines should be
drawn in recognition of such facts. It would appear that field studies
would be necessary to ascertain whether or not there are area differentials
which justified codal differentials and whether or not such differentials
should be strived for in further efforts to obtain either voluntary codal
agreements or future use under a possible new N.R.A. A study and examination
of facts obtained at the source, within the area in auestion,. should be
considered in the drawing of definite conclusions. It is recognized that
the problem of area differentials is not peculiar to the apparel industries
and no reason is seen why data bearing upon this problem could not be se-
cured by some special group in the interests of all industries concerned.
9. Distribution of Finished Product
Industry records are deficient in carefully organised material bear-
ing on the distribution of apparels. It is recognized that various methods
of distribution are employed, but careful studies of each from the stand-
point of cost, service standards, consumer relationships, etc., have not-ibeen
made. It would appear that a study should be made of this problem especi-
ally as it has a direct bearing on the interstate character of the business
in question. The sources here which would need to be visited seem to be
retail and wholesale organizations, individual retail and wholesale estab-
lishments, and members of industry who employ one method or another of dis-
tributing goods, whether it be through wholesalers, retailers, direct-to-
consumer, or retail outlet. It is known that apparel code authorities did
not gather material on this aspect of industry and to acquire sufficient
data to understand thoroughly the processes involved would necessitate
visiting the sources above referred to.
Conclusion
The above list of suggested industry problems for study is not intend-
ed to be all-inclusive but merely suggestive of some of the major problem
which fell within our study plans. It should be readily seen, however,
that a great amount of field work would be required to develop and under-
stand the various remif ications of the apparel industries business. Ind-
sutry statistics and literature is sadly deficient, especially in connection
with the various relationships between suppliers of raw materials and manu-
facturers on the one side and the relationships between the manufacturers
and the distributors or the consumers on the other side. The gathering cf
material of a character which would allow the development of the tentative
outline such as prepared for the study of the Men's Clothing Industry would
require the efforts of many competent observers, over a considerable per-
iod of time, who are familiar with the problems of the industry being
studied.
9782
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0RIGINA1 OUTLINE FOR
STUDY OF THE ilEN'S CLOTHING INDUSTRY
(Emphasis on Lien's Factory-Hade Dress Clothing)
I. Development and Scope of the Various Divisions of the Industry
Selected for Study.
A. Definition of industries and codes covered by the Study.
1. Reasons for limiting stud:/ to certain branches of the
Clothing Industry.
2. Description of the industry branches by products.
3. Code definitions by products and processes.
4. E;rplanation of codal jurisdictions and indication of
conflict or overlap as related to manufacturing processes,
distribution, and consumption.
B. Brief historical sketch of industry's beginning and develop-
ment to the present, touching u'oon:
1. Types of products manufactured.
2. Types of raw materials and equipment used.
3. Processes.
4. Customs and styles.
5. Distribution problems.
6. Nature of competition.
7. Character and type of labor employed.
8. Labor relations with employers.
9. Trade association growth.
10. Government influence and control.
C. Present scope of industry.
1. Number of individual establishments and capital invest-
ment by:
(a) individual proprietorship, partnership, corpora-
tion, cooperative .
(b) products.
(c) inside shoos and contract shops.
(d) market and geographical areas.
(e) size of firms.
(f) profits, losses, embarrassments.
2. Employees by:
^ (a) market and geographical area.
(b) age and sex.
(c) total wages and wage rates.
3. Value and volume of -oroducts by:
(a) type.
9782
-305-
(b) inside and contract shops.
(c) geographical and narket areas (production)
(d) distribution by states.
II. Haw Materials and Equipment.
A. Sources, kinds, and value of row material and eouipment.
1* Kinds of raw material and equipment used in branches of
the industry by:
( p ) type s .
(b) value in relation to total cost of product.
(c) value in relation to value of total supply of raw
materials.
(d) technical improvements — related to employee pro-
ductivity and employment.
2. Origin of raw materials and equipment by geographical
areas.
(a) origin of raw material and equipment in relation to
location of clothing manufacturers.
(b) foreign competition.
(c) seasonability — effect on production schedules and
prices.
B. Raw material and equipment market organization and price.
la Types of manufacturers and distributors of materials and
equipment.
(a) manufacturers and processors.
(b) distributors and various kinds of middlemen.
2. Methods of sale and purchase of raw materials and equip-
ment.
(a) variations in methods of purchase and sale (related
to various types of sellers and buyers).
la terms of sale.
a. discounts and rebates.
b. guarantees: quality and service.
c. allowances.
d. related to terms granted by clothing manu-
facturers.
2. credit problems.
a. proportion of credit sales to cash sales.
b. credit standing and needs of purchasers.
c. bargaining relations between purchaser and
seller.
9782
-306-
d. credit conditions requiring unusual fac-
ilities or terns.
3. competition.
a. price of raw materials and equipment.
(1) related to trices-, of clothing.
(2) evidence of lack of free corn-petition.
(o) price fluctuations and cost changes
(example — effect of increased wages
under N.H.A. on price).
(4) influence on raw material prices of
association and governmental action.
III. Organization of production.
A. Description of manufacturing processes: growth and develop-
ment to present.
1, Plant layout and technique.
(a) section work.
(b) unit system.
(c) difference between inside and contract shop.
(d) area or market differences.
(e) types of machines and equipment.
(f) systems of production control.
2. Comparison of varying processes and methods of manufac-
ture as to effects upon the following.:
(a) productivity.
ft) working conditions.
(c) methods of wage payments.
(d) costs and cost keeping methods.
(e) quality of product.
(f) labor-management relations.
(g) capital and credit requirements and terms,
(h) prices and pricing systems.
(i) responsibility for and method of controlling the
organization of production.
(j) location of manufacturing establishment.
(k) adaptation to style and seasonality.
- (l) standardization' of product — raw material and fin-
ished product.
5. Cooperative control of- manufacturing methods and proces-
ses — development and present status.
, a) labor union —
9782
-307-
1. collective agreements relating to processes and
methods of production.
a. adaptation to area and market variations
in methods of production.
b. effect on methods of production and work-
ing conditions in organized and unorgan-
ized plants.
(b) trade associations.
1. local and national agreements relative to
manufacturing processes and methods.
2. effects of association activity upon methods
of production.
(c) governmental.
1. local and state governments.
a. history tracing cause of intervention
'and legal basis of intervention.
b. nature and extent of control.
c. effects of local and state action — state
vs. interstate problems.
2. federal.
a. K.H.A, activity relating to control of
production processes.
(1) reasons for intervention.
(2) experience and effects on industry
under codes.
(3) problems of production in need of
federal control.
4. Large vs. small scale production.
(a) financial stability.
(b) labor relationships.
(c) distribution methods.
(d) methods of production.
IV. Finances.
A. Historical — general survey.
1. Capital investment.
(a) origin, growth, present.
2. Fortunes of the industry.
9732
-'603-
(a) profits, losses, and embarrassments.
(b) dividendr..
( c) taxes.
3. Financial'' development and fortunes of the. indus-
try, contrasted with-:
(a) other major industries.
(b) foreign textile industries.
Financial structure.
1. Development and organization.
(a) origin or capital.
1. geographical.
2. new capital vs. plowed-in profits.
(b) development and extent of various forms of
capital structure.
1. individual proprietorship.
2. partnership.
3. corporation (and puramided structures)
(c) factors influencing capital development and
financial structure.
1. entrepreneurs within the industry.
2. investment banker.
3. wholesaler — retailer — jobber.
4. cooperatives.
5. enterprises in allied industries.
6. governmental agencies and regulations.
(d) control
1. financial control — in whom vested?
2. financial control — relationshi-o to
management control.
2. Fixed capital.
(a) interest rate.
1. geographical variations.
2. variations by type of "enterprise. -
3. risk variations.
4. ebsolescence and depreciation.
(b) cost and extent of financing and refinancing.
9782
0782
-309-
3. Working capital and commercial credit.
(a) ratio working camtal to fixed camtal.
(b) ratio credit to fixed and working ca-oital.
( c) agencies granting credit or advancing work-
ing capital — tynes and methods.
1. commercial banks.
2. wholesaler- -retailer — jobber.
3. enterprises in allied industries.
4. selling agents.
5. government agencies.
(d) cost of various types of credit and borrowed
working camtal.
( e.) relationship of various tyoes of credit to
managerial policies.
(f) geographical variations in credit availability,
■methods and rates.
(g) discount and credit terms granted customers —
relationship to borrowed working camtal and.
credit granted industry.
1. tynes of discount and credit granted
customers.
2. relationshit) of tynes of credit granted
industry to tyoes of credit granted by
industry.
V. Labor.
A. Conroarative distribution of employees by years and
monthly by:
1. Markets, geographical, and -oolitical areas.
2. Age and sex.
3. Occuoations and wage rates.
4. Seasons.
5. Size of ulant.
3. Hours of employment.
1. Distribution by market, geographical and
-political areas.
2. Distribution by occupations.
3. Distribution by size of nlant.
4. Distribution by methods of -production. •
5. Comparison with other and allied industries.
6. Ejme workers.
7. Effect on re-enrol *>yraent.
-310-
C. Wages.
1. Industry totals for years and months.
2. Heal wages.
3. Wage rates — distribution by
(a) type of shop of plant — inside and contract.
(b) size of shops.
(c) market and geogranhical areas.
(d) union shops and non-union shops.
(e) occupations by individual establishments.
(f) related to man-hour productivity.
(g) relation to unemployment.
(h) comparison with other industries.
4. Methods of wage payments,
(a) variations by:
1. manufacturing methods or processes.
2. market and area customs.
3. effect on productivity and wage outlays,
5. Compared with allied and other industries.
6. Methods of handling learner and handicapped
workers Toroblem.
D. Ozeneral labor conditions.
1. Standards of safety and health.
(a) in large -olants and small plants.
(b) methods of production.
(c) by market areas and geographical regions.
(d) union and non-union employees
2. Vacations and holidays, recreation.
3. Sick benefits, insurance, pensions.
(a) management.
(b) association and union.
4. Technological changes related to labor
standards and conditions.
5. Adjustment to shifts in location of industry.
6. Training.
E. Collective activity.
3782
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1. Nature and extent of labor unions*
(a) type of union.
(b) size of union.
( c) - membership by market areas and type of manu-
facturing establishment.
(d) membershit) by occupations.
(e) membership by concerns and establishments.
• 2. Union activity — wages and working conditions.
: (a) collective agreements.
1. number and character of agreements with
: individual members of industry.
2. number and character of agreements with
enrol oyer groups.
(b) methods of bargaining.
(c) organizing methods.
(d) union wages compared with non-union wages.
(e) working conditions in union shops co-roared
with conditions in non-union shops.
(f) union welfare -plans.
3. Union -participation in governmental control.
(a) local and state.
(b) federal
VI. Distribution and Consumntion.
A. Markets and marketing organization.
1. Distribution channels — description of
(a) wholesalers and jobbers.
(b) retailers.
( c) buying officer.
(d) direct to consumer.
(e) retail cutlet.
(f) ex-porters and importers.
2. Conroariscn of methods of distribution, explanation
of development and use in terms of:
(a) costs in relation tc -orice to consumer.
(b) margin of profits — manufacturer and dis-
tributor.
(c) -product of standards (consumer).
(d) methods of obtaining business from
9782
-312-
1. manufacturer.
a. discounts, terms, concessions.
b. bargaining advantages due to nature
of market mechanism.
P. ultimate consumer.
a. advertising and soliciting,
trade marks and trade names.
3. The "distribution area" as evidenced by:
(a) advertising.
(b) transportation statistics: shipments
and agencies.
(c) production areas corn-oared with
.consumer distribution.
(d) location of offices, stores, ware-
houses engaged in distribution.
General aspects cf consumption.
1. Variations in consumer demand.
(a) dollar competition with other products.
(b) influence through style.
(c) potential capacity to consume,
(d) unexploited markets.
(e) influence on duality standards
Influence of Work Clothing on Men's Clothing
A. Pants Conflict.
1. Describe evolution of work-pants from
overall to semi-dress pants — causes therefor.
a. Changes in material.
b. Changes in buying habits caused by
style in men's clothing industry.
(l) 2-pants suit.
.(•2) ; odd coat and slacks.
2. Describe relationship of pants to manufacture
of work clothing.
a. Proportion made in same plant as other
work clothing.
b. Proportion made in separate plants.
c. Proportion made separately by men's
9782 clothing manufacturers.
-313-
(■l) trade volume of separate -pants sold by
men's clothing manufacturers.
3. Describe differences in methods of manufacture
between work-clothing and men's clothing, with
particular reference to
a. Location of plants.
b. Unionization.
c. Manufacturing costs.
d. Marketing and distributing policies.
4. Describe influence of government contracts on
situation.
a. Types of bidders — differentiating between men's
clothing and work-clothing manufacturers.
Mackinaws and melton jackets and their influence on
overcoats.
1. Show importance of mackinaw production as related
to other articles of work clothing with particular
reference to amount manufactured in shops making
other items of work-clothing or leather garments.
2. Show amount of mackinaws manufactured by men's
clothing manufacturers making other articles of
men's clothing.
3. Describe differences in costs in the manufacture of
mackinaws in men's clothing factories and in work-
clothing factories.
4. Trace effect of sales of mackinaws on sales of
lower priced overcoats by compiling statistics on
a. Production of cheap overcoats over a. period of
years.
b. Production of mackinaws over a period of years.
5. Describe influence of government contracts on
situation.
a. Types of bidders — differentiating between men's
clothing and work-clothing manufacturers.
6. Describe the union situation in the mackinaws
industry.
a. In non-union work-clothing plants.
b. In union wurk-clothing plants and leather
garment plants.
3782
-514-
c. In men's clothing factories.
7. Show corn-oar? tive costs for a, b, and c of 6.
C. Wash Suits.
1. Extent, number, and costs of wash suits manufactured
by work-clothing manufacturers.
2. Wash suits as an item of men's clothing manufactured
by men's clothing manufacturers.'
3. Conraare the sales trend of the two grouns above as
to volume, -oroduction, terms, and outlets.
9782
-315-
APPENDIX B
DI VI SI Oil A33 II IH STRAT0R3
A. D. Whiteside, from June, 1933, to April, 1934
Sol A. Rosenblatt, from April, 1934, to Octiber, 1934.
Prentiss L. Coonley, from October, 1934, to April, 1935.
id. D, Vincent, from April, 1955, to May, 1935
DEPUTY ADMINISTRATORS
Lindsay Rogers, from June, 1933, to December, 1933
B. II. Gitchell, from December, 1933, to March, 1934.
Earl Dean Howard, from M a rch, 1934, to June, 1934.
Dean G. Edwards, from June, 1934, to September, 1934
M. D. Vincent, from September, 193-4, to April, 1955
Burton E. Oppenheim, from. April. 1955, to Ma/, 1954
ASSISTANT DEPUTY ADMINISTRATORS
H ndled by Deputy Administrator until J 8 .nuary, 1934
John R. Beecroft, from January, 1934, to September, 1934.
S. II. Ourbackdr, from September, 1934, to January, 1935.
Walter E. Woodford, Jr., from January, 1935, to Ma.?, 1935.
AIDES
S. II. Ourbacker, from June, 1934, to September, 1934
Robert L. Brandt, from August, 1934, tc /lay, 1935.
Walter A. Simon, from August, 1934, to October, 1934.
3782
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APP'SKDIX
Production of Men's Clothing Und=>r
th° Cotton Garment Code — The Over-
lap Pro Diem
9782
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TABLE OF contents
APPENDIX C OF THE MEN'S CLOTHING INDUSTRY STUDY'
PRODUCT I OK OF LIEN'S CLOTHING WIDER TliE
COTTON GARMENT CODE — THE OVERLAP PR03LEM
SUMMARY will be. found, "beginning. Page 4, Chapter I, Hen's Page
Clothing. Industry Study. No.
CHAPTER I--0RIGIN OF THE' CONTROVERSY . . . ' 320
I. Development .in Style, Appearance, and Durability
of Cotton anc'i Cotton Mixture Fabrics 3-0
II. Decreased Purchasing Power of Consumers 320
III. Decreased Demand for Overalls 320
IV. Necessity for Lower Selling Prices to Consumers 321
V. Widespread Establishment of Plants in Raral
Communities to Permit Payment of LoT7er
. . Wage Rates 321
VI. Style Trend Towards Separate Coats and Trousers 321
VII. Increased Interest in Sports, Particularly Golf 321
VIII. Style Consciousness of Men in Rural Communities 321
IX. Wage and Hour Advantages under Cotton Garment Code 322
X. Price Levels Undermined ''oy Prison Labor Production 322
A. Statistics on Prison Labor Production 322
. B. Statement of Judge Adkins 324
CHAPTER II--THE CODES AS ORIGINALLY APPROVED 325
I . Men' s Clothing Code 325
A. Proposed Definitions 325
B. Objections by Wash Suit Manufacturers 325
C. Approved Definitions 326
D. . Approved Wage Provisions 327
E. Approved Hour Provisions 327
II . Cotton Garment Code 327
A. . Public Hearings — Delay in Approval 327
3. , Early Protests on Overlap Problem 328
C. . Deputy Administrator Gitchell's Statement on
.Actions Proposed and Actually Taken. 328
D. . Approved .Definitions 331
E. Approved Hour Provisions 332
F. Approved Wa e provisions 332
9782
-318-
Page
CHAPTER III— AMENDMENTS TO BOTH CODES, DECEMBER 18, 1933 334
I. Public Hearing November 27, 1933, on T7ash Suits 334
A. Objections of Cotton Garment Industry 334
B. Arguments of lash. Suit Manufacturers 336
C. Arguments of Men 1 s Clothing Industry 337
II. Public Hearing November 28, 1933, on Single Pants 342
A. Report of George P. Dowling 342
B. Arguments of Men' s Clothing Industry . 344
C. Arguments of Cotton Garment Industry . . . 349
III . Code Changes Approved 357
A. -Men's- Clothing Code Definitions and Yfeges 357
B. Cotton Garment Code Definitions and Wages 358
C. Conditions in the Order of Approval 359
CHAPTER IV— THE INTER-CODE COMMITTEE 360
I . Appointment of the- Committee 360
II . Recommendations of the Committee - 361
A. Report of Meetings and Votes on Fabric
Classification 362
III. Men's Yfash Suit Problem 364
A. Protest of New Orleans Eirms 364
B. Investigation by Deputy Administrator Morris
Greenberg » 367
C. Agreements with New Orleans Firms 367
D. Order No. 15-8 — Hours Exemption to These
Manufacturers 373
CHAPTER V— AMENDMENT TO COTTON GARMENT CODE, MARCH 15, 1934 375
I . Code Changes Approved 375
A. Deputy Administrator Gitchell'.s Letter of
Transmittal - 375
B. Different- lagt Rates for Different Fabrics
Approved ...... 377
C. Special Administrator -Succeeding Inter-Code
■Committee .- 378
II . Effects- of this Amendment 379
A. Fri/-- v-.i-o Classification Proved Impractical 379
B. Pro-vests from Southern Manufacturers 380
C. Protest from Associated Pants Manufacturers 383
III. -He-port -::■:-• -Special Administrator Godfrey Bloch 387
A. -Tar.'tes Submitted with Report , 391
9782
-J 19-
Page
CHAPTER VI—AMENDMEiJT TO COTTOF GAHMENT CODE, AUGUST 21, 1934 398
I. .Contributing Merits Prior to This Amendment 398
A. Notice 'of Public Hearing June 18, 1934 398
B. Protest Letter to Industry by Cotton Garment
Code Authority 400
C. .Protest Letters and' Testimony Regarding the
Calling of this Hearing 402
II. Public Hearing June 18 to 22, 1934 405
A. Arguments of Lien' s Clothing Industry 405
. B. . Arguments of' Cotton' Garment Industry 410
C. Testimony Regarding Mackinaws, Melton Jackets, etc 414
III. Post-Hearing Developments Prior to Approval 421
A. Letters of Protest from Cotton Garment Industry 421
B. Deputy Administrator Dean G. Edwards ' Letter
of Recommendation of the Amendment 424
IV. Effects of This Amendment 426
A. 36-Hour Ueek as of October 1, 1934, Approved
for Cotton Garment Industry 426
B. Ttto Stays Issued, Delaying Effective Date to
December 1, 1934 426
CHAPTER VII—DEVELOPIIEI'TS PROM AMENDMENT 110. 7 TO SUPREME
COURT DECISION, MAY 27 , 1935 427
I. Progress up to December 1, 1934 427
A. Correspondence re Overlap Settlement (in September) .... 427
B. Order Suggested by Deputy Administrator
Greenberg, October 12, 1934 428
C. Proposed Order Dram by Deputy Administrator
Oppenheim, November, 1934 435
II. Delay Due to Injunction Suit 439
A. Letters from Associated Pants Manufacturers,
Approving Proposed Order 439
B. Injunction Suit filed December 1, 1934 441
C. Changes in Cotton Garment Code Authority 441
D. Exemption Granted Associated Pants Manufacturers 441
E. Injunction Suit Terminated, January 23, 1935 443
III. Pinal Efforts Up to Supreme Court Decision 443
A. Men 1 s Clothing Industry Urges Prompt Action 443
B. Changes in Proposed Pants Order Suggested
by Stanley A. Sveet, Chairman of the
Cotton Garment Code Authority 444
C. Request of Associated Pants Manufacturers for
Four Hours Weekly Overtime, Similar to
Overtime Granted Men's Clothing Manu-
facturers 450
9782
--319-A-
Page
D. Cotton Garment Code Authority Approves Proposed
. . . .Pants. Order, March 11, 1955 451
E. Protests from Southern llanufacturers 451
F. Letters, from Associated Pants Manufacturers,
Approving Proposed Order 454
G. Changes Proposed by Deputy Administrator Oppenheim 453
H. Committee. Appointed by Cotton Garment Code Author-
, . ity,. Classified Wages for Cutters and Cff-
Pressexs. Approved, April 30, 1935 461
I. Pinal Proposal by Deputy Administrator Oppenheim 463
J. Southern Manufacturers Still Object 466
K. Supreme .Court Decision 471
L. Brief Summary and Findings on Overlap Problem 473
9782
-320«
APF'SEXJIX C
TH1 ivniv > S CLOT; II N& P f D r S TEY
PROD T TGTION_OF V~I'S ' D EI G.I^j''^
CQ 'TOiv ^M TT CODE— TE : OVERLAP PROBLEM
CHAPTER I.
ORIGIN CF THE CpyT flOVSRSY
Only within recent years has the competition in the manufacture
and distritution of men's and hoys': single pants, summer wash suits,
mackinaws, melton jackets, etc., become actually acute and serious
between the Men's Clothing Industry and the Cotton Garment Industry.
Frevious to the present -pronounced fashion trend toward the wearing
of odd trousers of "both wool an' 1 cotton, cotton garment plants con-
fined their production mostly to overalls, i^ork pants, and wash suits
for use as <-ork clothes only, and clothing plants produced th« great
hulk of separate trousers of wool or part wool materials.
During the -oast fiv? or six years, this situation has changed
entirely, and competition between these grouos, aggravated greatly in
1933 and 1934 by the more advantageous wage and hour provisions of the
Cotton Garment Code, has become very severe, primarily due to:
I. Development in Style, Appearance, Durability of Cotton and Cotton
Mixture Fabrics.
Development in appearance, design, style, an^ durability of cotton
and cotton mixture fabrics, to compete with and substitute for the more
expensive woolen and -orsted fabrics. This fabric improvement has been
so~ marked that cotton trousers "are now desind by the millionaire golfer
as well as by the working man." (*)
II. Decreased Purchasing Powir of Consumers.
Inability, due to the depression, of many consumers to pay former
-prices for woolen trousers, greatly increasing the market for cheaper
cotton or cotton and wool trousers.
III. Decreased Demand for Overalls.
Most work clothing plants originally produced overalls and some
work pants. Then, because of the tremendous decrease in the demand for
overalls (**) they began to make icor? work pants, separate pants, slacks,
mackinaws, melton jackets, play suits, ;tc, These lines of msrchandise
could be made without changing their plant equipment, personnel, or or-
ganization, and enabled them to maintain greater continuity of employment.
(*) Transcript of Hearing on Men's Clothing, Cotton Garment and Dress
Manufacturing Industries, June 20, 1934, Volume 3, Page 640.
(**) Transcript of Hearing on Men's Clothing, Cotton Garment and Dress
Manufacturing Industries, June 18, 1934, Volume 1, Page 80 and 81.
9782
-321-
They were also sold largely through the same channels of distribution.
Through this development, what were former nr 1 -- pants, hy sales-promo-
tion and improvements in fabric, style, and design, "became extensively
used for sport and dress purposes. And "because of the change in fashion
and the downward trend in prices, men's wash suits, made. in work clothing
factories, which were mostly of the seersucker tyre, b ??an to compete with
pants and summer wash clothing produced by the Men's Clothing Industry.
17. Necessity for Lower Selling Prices to Consumers.
Lower selling price range for separate trousers forced many
clothing manufacturers to the production of the chea-oer cotton and cotton
mixture articles.
V. Widespread Establishment of Plants in Rural Communities to Permit
Payment of Lower Wage Rates.
Formerly most single pants were maddein the centralized clothing
centers in the large cities. With the entrance into this field of the
overall and work clothing plants, the industries spread over the entire
country, under wage rates considerably below the union scales. It there-
fore became necessary for the manufacturer, in New York, Chicago, and other
clothing centers, to find new places where they could produce these gar-
ments at a lower cost. Forty or fifty such shops, with a production cauac-
ity of from 120,000 to 150,000 pairs per week, were established in Penn-
sylvania and other outlying districts close to New York, in some of Hiich,
prior to the Codes, employees' worked sixty-five' hours per week, at v^ry
low weekly wages. (*)
VI. Style Trend Towards Separate Coats and Trousers.
The style of wearing separate coats and trousers has ra-oidly
increased, especially amoung young men of school and college ages. Hence,
the separate pants have become very important items of the clothing In-
dustry.
VII. Increased Interest in Sports, Particularly Golf.
The construction of one or more golf courses in about every
town in the country, the vast number of people now playing this game,
and the universal interest in recreation and snorts of all kinds, have j
greatly increased the demand for separate trousers for sports use.
VIII. Style Consciousness of Men in Rural Communities.
Greater style consciousness of men in the smaller outlying
rural communities has inoreased their demand for better and fancier
clothing, even the present style trend of separate co ats and trouser s.
(*) Transcript of Hearing on the Cotton Garment Industry, November 28,
1953, Page 83.
9732
-322-
IXi Uage and Hour Advantages under Cotton Garment Code.
After the approval of the two Codes, Men's Clothing — August
26, 193.3, and Cotton Garment — November 17, 1933, the competitive situa-
tion "became much more critical, as in the strongly-unionized lien's
Clothing Industry, the wages were higher, the hours permitted were
shorter, and there were higher classified wage rates for cutters and
of f— pressers, against a minimum wage only in the Cotton Garment Industry,
This set-up, of , course, afforded those slants operating under the Cotton
Garment Industry Code on the same garments a ver^ marked cost of pro-
duction advantage.
X. Price Levels Undermined by Prison labor Production.
One of the main contributing factors to this competitive
controversy was the production of work pants and single pants by prison
labor. Pants manufacturers operating under the Cotton" Garment Code,
at all hearings and conferences on the overlapping problems, objected
. most emphatically to any proposed raise' in the minimum wage rates, or
the introduction of any classified wage scales e claiming that any
further advance in the selling prices of their garments would be most
detrimental and eventually force them to close their plants. Low sell-
ing-prices, they argued, were absolutely essential on their products,
due primarily to the competition they were receiving from the prison-
made pants, overalls, work shirts, etc.
Previous to the Codes this prison labor situation was very
serious ana had a marked effect on the general price structure of the
Cotton Garment Industry. As many as forty states at one time or another
produced cotton garments in prisons for the open market. Control over
this production was virtually impossible, and numerous unscrupulous
manufacturers, operating prison shops and exploiting the prison labor,
were often able to undersell and demoralize completely the entire market.
The Cotton Garment Code exoressly prohibited any of the in-
dustry members from employing prison labor, and this provision iracti-
felly eliminated this under-selling evil in the industry, so that the
complaints of these cotton garment manufacturers that they could not
increase their prices due to prison competition were, in most cases 9
not based on the actual conditions and facts. A Compact of Pair Com-
petition for ths Prison Industries of the United States was also
approved by the President on April 19, 1934.
A. Statistics on Prison Labor Productio n
The following excerpts from a study made in Hay, 1935, by
Dr* Alfred Cahen, Ph. D. , Cotton Garment Code Authority statistician,
and the statistical sui.ima.ry of a questionnaire set out ^oy the Code
Authority in April, 1935, give a brief picture of this Prison Labor
problem,
"Prison employment on cotton garments increased from 6,000
in 1385 to 16,000 in 1932. Of these 16,000, 2,000 were working on
garments for state use, 2,000 for open market sales by the states, and
9782
-32 ■; ~
12,000 for private contractors.
"In 1385- — 3fo of prison laborers worked on cotton garments.
"In 1932 — 19$ of orison laborers worked on cotton garnents,
(a greater oercent than any other industry),
"In 1952 — 7,000 prisoners orod.iced work shirts.
— 4,000 -prisoners produced vjor 1 : pants. .
"In 1954 — 1,000 prisoners iroduced work shirts.
— 1,600 prisoners ix'odaced work oants.
"The reason for this sharp decline was that five large com-
panies fron 1933 to 1954 ceosed contracting their work to -orison labor,
and recorded en increase of 5,000 free eiroloyees in eight new factories.
"At one time or another, 40 states produced cotton garnents
in prisons for the open market. The Ion,-,- fight for free labor lias
reduced this to 9 states now." *
"]Pifty-two -oroducers of war).: nants re>ort they ere affected
by prison competition.
"Pron label sales of the Prison Labor Authority, Deputy Ad-
ministrator Collins estimated that 1934 -orison jroduction was slightly
under 2,250,000 work prints and overalls, and that approximately 3,100
prisoners were working on all tj'pes of cotton, garments. -.
"Deported prices per dozen of prison-made garnents are as
low as $6.00 for work pants.
"median prices :>er dozen on work pants — Free factories,
$13,36; Prison factories, $7.50, ' .
"Questionnaire replies report cotton garment prison pro-
duction in 17 states; that 43 old distributors and 20 new ones are
carrying orison goods in their localities, and 11 nanufacturers, 16
retailers, and 25 wholesalers are distributing >rison goods.
"Pe^ort sale of prison oroducts in 28 states, including 9
states where such sales are -prohibited legally," **
(*) "Trends ir Cotton Garment Prison Labor 1885 to 1934"
By Dr. Alfred Cahen, Llay 17, 1955. (; esearch and Planning
Division Library,)
(**) Statistical Summary af Prison L; bor questionnaire
sent out April 5, 1935; dated April 25, 1935; by
Ir. Alfred Cahen. (Pese; rch and Planning Division
Library. )
9782
-324-
3 . Statement of Judre Adkins.
The following statement of Judge Jesse C. Adkins, of the
Supreme Court of the District of Columbia, in his decision rendered
January 22, 1935, in the case of Alabama Textile Products Co., et al.,
vs. Honer S. Cunnings, the Attorney General, et al., also shows the
improvement in this prison situation,
"o. The weight of the evidence shows that the
competition ^ith -prison-made goods has decidedly
decreased. In 1932, 13,948 prisoners were em-
ployed in manufacturing cotton garments; in No-
vember, 1934, this number was reduced to 3,098.
"T7ork shirts and work pants are the principal if
not the only cotton garments made in prisons,
"In 1952, 22,000,000 work shirts and 9,000,000
work pants were so made.
"Blue Eagle la Dels were first used on cotton
garments about May 1, 1934. Between that date
and December 1 about 600,000 labels were issued
for shirts made in prisons and about 43,000,000
labels were issued for shirts made elsewhere.
, "During the same period about 1,100,000 labels
were issued for work pants made in prisons and
nearly 30,000,000 such labels were issued for
work pants made by the rest of the industry.
"c. The -orison competition otherwise is less
severe than it was before the adoption of the
'orison corroact."
9782
CHAPTER II
TIIE POPES AS ORIGINALLY APPROVED
I. MM'S CLOTHING CODE.
During the many days and weeks of negotiations, conferences,
and hearings prior to the approval of this Code, tlie main issues ■
at stake were the widely- different points of vie-; of the two as-
sociations of the Industry, the Clothing Manufacturers Association
of the united States of America, and the Industrial Recovery Associa-
tion of Clothing Manufacturers, especially in respect to wages above,
the minimum and the administrative machinery to be set up for oper-
ating the Code. In the determined but mostly unsuccessful effort
to settle these differences and .submit for final approval a Code
satisfactory to both factions, sufficient consideration was not
given to definitions of the products of the Industry, especially in
relation to future jurisdictional conflicts with ether industries
which mgiht produce articles of a similar or closely- related nature.
A. ;• Pro-nosed Definitions.
Article I of the Code proposed by the 1 blothing Manufacturers
Association cf the United States of America read:
"Definitions: The term' Clothing Industry 1 as used
herein is defined to mean the manufacture of. men's and
boys 1 and children' s -clothing, summer clothing, -uniforms,
single knee pants, single pants, men' s and boys' leather
coats and raincoats. "(*)
B. Objections by Wash S ait h fl uuf ■ ctu rgrs. ' •
Mr. Elmer W a rd, of the Goodall Company, manufacturers of ■
"Palm Beach 6uits" asked that special consideration and provisions
be made for this branch of the Industry producing simmer, clothing.
"The suit manufactured hy this subdivision is a highly seasonal
product — it does not require tailoring or any special ability to
make it up— - the skill required is mot comparable' to the higher de-
gree required in the manufacture of wollen suits. The bulk of the
work is now done in the South, where the worker is generally of
slower temperament, ., is not keyed up to systematic production
of the North and produces on the average few units per individual. — ■
The purpose and intent of the National Recovery Act will best be
effectuated if a minimum' wage of thirteen collars per week for the
Northern A ea and twelve dollars for the Southern Area be applied
(*) Transcript of Hearing en's Clothing Industry, July 26, 1933,
Volume, 1 Pages 10-:.'
9782
_7,Off_
to this subdivision. — At least fifty per cent of the employees are now
working for less than the proposed minimum, and this would he a fifty
per cent advance over the present wage scale.
— The maximum hours per week should be more equitably applied to
this subdivision, and some additional working time allowed during
the peak season, — The manufactured garment has always brought a low
price -in- the consumer's market and any hgihger. scale of wages other
than that proposed would raise costs all out of proportion to the
possible sale price, arid probably result i . the elimination of this
industry and those employed therein. "(*)
Mr. Leon G-odchaux, of Mew Orleans, La., representing the Men's
W a sh Suit Manufacturers National Association, a group of ]>T e w Orleans
firms, exclusive wash suit manufacturers, the largest single group
in this Industry, asked for a separate Code for these manuf acturers.
S7e urge, first, that within the intent and meaning of the
National Industrial Pecovery Act, not being within the same
competitive group, we do not belo g and should not be placed
under the same Code as that governing the manuf actur err, of
woolen garments. Second, being a separate and distinct industry
we are, primarily, entitled to promulgate our own Coda. Third,
because of the methods adopted by \\s in the manufacture of wash suits,
and because of the materials used and labor employed therin
finding ourselves closely allied to the various groups comprised
within the I. A, 5, M. and because of our sincere desire to cooper-
ate with the Administrator, we have voluntarily place oxirselves
under the Code -of the I.A.G.M. — We therefore respectfully urge
that our position be maintained and that we >bw permitted to
refrain from associating ourselves with the manufacturers of
woolen clothing." (»*)
C. Approval " Dif initions .
No question was raised by any of the single pants manufacturers
as to the possible inadequacy of the definition of "pants" or as to
the probability of feter overlapping trouble with other garment codes.
As a result of the statements of Messrs. W a rd and Godchaux at the Code
hearings, and later arguments and testimony (documentary evidence
of which is not available) at the post-hearing conferences, the defin-
ition section was slightly changed, and as finally approved on
August 26. 1933, read as follows:
"I. Definitions. — Ther term 'Clothing Industry' as used
herein is defined to mean the manufacture of men^ s boys' and children's
clothing, uniforms, single knee pants, single pants, and men's
summer clothing (exclusive of cotton wash suits)."
Transcript of Hearing on Men's Clothing Industry, July 27. , 1933,
Volume 2, Pages 67-91.
(**) Transcript of Hearing on Men's Clothing Industry, July 27, 1933,
Volume 2, P a ges 334-343.
9782
-327-
D . Approved W -ge ^ rov isi oils.
Hie following minimum and classified wages were established:
"II. Minimum wages to manufacturing employees shall be at the
rate of 40^ per hour in the North, and 37<£ per hour in the South
"The minimum wage paid by employers to employees working on single
knee pants shall be at the rate of 37^ per hour.
(a) On mid after the effective date, the minimum wage which
shall be paid to cutters shall be at the rate of $1.00 per hour, and
the minimum wage which shall be paid to off-pressers shall be at the rate
of 75 cents per hour.
(b) The existing amounts by which v- ;es in the higher-paid
classes, up to classes of employees receiving $30.00 per week, exceed
wages in the lowest paid substantial classes shall be maintained."
E . Approved Hour Provisions.
The following maximum hours were established:
"Qn and after the effective d-te, the hours of employment for em-
ployees in the Clothing Industry, except repair shop crews, engineers,
electricians, firemen, office and supervisory staff, stock clerks, ship-
ping clerks, truck drivers, porters rnd watchmen* nnd except employees
engaged in bona fide managerial or executive capacities shall not exceed
thirty-six (38) hours per week nor eight ( 8) hoxirs per day. Employers
shall not operate productive machinery in the Clothing Industry more
than one shift of thirty-six (36) hours per week
"Repair shop crews, engineers, electricians, firemen, office and
supervisory staff, stock clerks, shipping clerks, truck drivers, porters,
rnd watchmen shall not work in excess of an average of forty (40) hours
per week during any year beginning with the effective date."
II. 'THE COTTOi: GARMENT CODE
A. Public Herrin :s - Dala.7 in Approval.
Fublic hearings on this Code were held on August 2 and 3, 1933,
but the Code was not actually approved until November 17, 1933. This
was in reality a trade association code rather than an industry code,
and was based not on the product but on the type of material used in
the product and was inevitably due to conflict in many cases with the
product classifications of other needle trade industry codes, especially
as the hours proposed were relatively high and the wages proposed were
relatively low. The long delay before final approval was chiefly be-
cause of the many diversified types of garments to be included, nnd the
early realization thnt many cases of overlapping and unfair competition
with other codes were bound to arise. Single pants and men's cotton
wash suits were two of those most important problems.
9782
-328-
E. Early Protests on Overlap Problem .
Immediately after the effective elate cf the Men's Clothing Code,
September 11,1953, a number of complaints rare filed by manufacturers
operating under that Code that other manufacturers making precisely
similar garments claimec that they rere chiefly of cotton content,
and therefore could be produced under the more, favorable hour and v/age
provisions of the proposed Cotton Garment Code. Al r 'o, a number of pants
manufacturers withdrew from the Industrial Recovery Association of
Clothing I.lanuf acturers and affiliated themselves with, the Interuationel
Association of Garment Manufacturers, the sponsoring organization for-
the Cotton Garment Code.
C. Depv.ty Administrator Citchell'r Statement on Actions Proposed
and Actually Taken .
A number" of conferences and hearings on the' e problems were held,
induing a Public Hearing on September 26, 1933, Deputy Admini strator
B. II. Gitchell's statement at the opening of the Public Hearing held
November 27, 1933, gives a, very good summary of the various steps pro-
posed or actually taken by the Administration and the Code Authorities
on tnis particular jurisdictional problem subseauent to the approval
of the Men's Clothing Code on August 20, 1933.
| "There is. something of a history of" this; after the Men's
Clqthing Code went into effect the hearing was arranged and
held, I believe, on the ori phial ap lica.tion of a group of
-manufacturers in New Orleans, which" was later supported by
a number of other people, and a hea.ring on the subject was
held on September 26th, 1933.
"As a result of that hearing, I believe an agreement was
ma.de betveen various^ factors of the industry for the inclu-
sion of Men's Wash' Suits of the chief' content of cotton,
under the Clothing Code, and it was intended that an exe-
cutive oner should be issued making the necessary amend-
ments to the Men's Clothing Code to cover that agreement.
"For the purposes of the record, and to give the history of
the matter before you, I am ..ping to read the report pre-
pared by Dr. Rogers, and also the rough draft of the pro-
posed Executive Order.
"Dr. Rogers says in this memorandum:
"'As pointed out in my report recommending approval of the
Code for the Men's Clothing Industry, difficulties are in-
evitable in respect of definitions as to what a code for an
industry could cover. As an example, I cit.ee summer clothing
for men and stated that "the oulk of the production of men's
wash si-.its is by firms who are jjrimarily cotton garment'
manufacturers. The class of labor and methods of production
are entirely different from the class of labor and methods of
production of woolen men's clothing." The question of what
9782
~: 29-
ald be done was debated at length and this arrangement was
to: T3 '■ ct r ■ if Cott n : sfc suits si ; d ;>■ p t
under the. Cott :. - nt Cod- which was then and still is pend-
. All other wash clothing should come under tin Men's
Clothing Code. This de-finitj d to by represen-
tatives of the Hen's Wash Suit Mauufactur •?. Rational Associati
(largely a, groue f Rev Drleans manufacturers) and representa-
tives of the Clothing . . facturers Association of the United
States of America (one of tin propos: i s iCia.tions of the Men's
Clothing Code. )
"'The Men's Clothing Code went into effect on September 11, 1933:,
and difficult: s wi r Immediately apparent. The New Orleans
nufacturers had consid rable production of linen suits which
-. re cut and made at the same time and by the same workers as
cotton wash suits.. Manifestly it would irap< se an unnecessary
hardship on such manufacturers to arrange for different wages
and hours for employees when engaged in the manufacture of sum:', r
was clothing of different fabrics. The Hew Orleans .manufacturers
protested, and askei :' r relief, C'oincidentally, manufacturers,
the builk of -' s i u tier, is in wollcn clothing, protested
that in respect at their -.ash clothing th did not have the ad-
vantage of longer hoars and' lower rages as tl ■ He 1 . Orleans manu-
facturers would. have (they com; so was Lnt n< c under the Cotton
Garment Code. )
"A hearing was therefore had on September 26, 1933,' and the
matter was gone into fully. Excellent spirit was shown at the
hearings and no interested party had any disposition to chal-
lenge the two pre li'ses which. th< Deputy Administrator -suggested
as determining the settl -mentj
"1. That manufacturers who' were voluntarily under the Men's
Clothing Code and willing to stay there with shorter hours and
higher minimum rages should not be taken out . from under that code
in respect to their manufacture of wash cl thin ; and
"2. That if tl y stay > under the hen's Clothing Code they
should not be subject to unfair competition from ether manufacturers
who wore under a code more favorable in its hours and minimum
wage provisions.
"In conferences subsequent to the public hearing, agreements
were entered into by which the members of the lien's Wash Suit
Manufacturers Nati nal Association will come under the Men's
Clothing Code but with r cognition of the feet that this branch
of the Men's Clothing Industry is more seasonal and is entitled
to overtime at the peak periods of t . :r; and with recogni-
tion also of the fact that minimum w; - • guaranteed to workers
of a somewhat different type from thos w ■:' k ; primarily on
Lcn clothing cannot be as high as .h ' s originally in-
serted in the hen's Clothin
"'I therefore- recommem thai the Men* s Clothing Code as ?$-
97S2
-330-
proved by the President on August 26, 1933, "be amended in
order to carry out this agreement. When the Executive Order
is issued, all manufacturers of men's summer clothing will'
he under the same code subject to wage and hour provisions
to which they all agree, whether they are located in New
Orleans or in the rest of the southern section and are ex-
clusively manufecturors of wash clothing or whether they
are in the northern section of the country and only manu-
facture wash clothing during certain periods of the year. *
"The memorandum of Executive Order which TJr. Rogers has
drawn up for the Executive Order is as follows:
"'An explication having been made by the Men's Clothing
Code Authority and the Men's Y/ash Sivit Manufacturers'
rational Association, pursuant to and in full compliance
with the provisions of Title I of the National Industrial
Recovery Act, approved June 16, 1933, for modification
and amendment of the Code of Eair Competition for the Men s
Clothing Industry, as heretofore approved by me on August
26, 1933, and for the modification cf my approval of said
Code of Eair .Competition accordingly, and the Administrator
having recommended the granting of such approval, such
proposed modifications and amendments to be in accordance
wi th th e folio wi ng p ropo s al s :
"'(a) That in the definition of the term cloth-
ing industry in Article I of the said Code, there be dele-
ted the words "exclusive cf cotton wash suits" after the
term "men's summer clothing" so that the complete defini-
tion shall read:
"'"The term 'clothing industry 1 as used therein is defined
to mean the manufacture of men's, boys', and children's
clothing, uniforms, single i:nee pants, single pants, and
men's srmmer clothing."
"'(b) That there be added to Article II of the
Code, a new paragraph to be known as paragraph (g) as
follows:
,M "(l) In the State of Louisiana, the minimum wage paid by
employers to employees working on wash suits of 100 per cent
cotton content shall be a.t the rate of 35 certs ( 35(£) ; the
minimum wage which shall be paid to cutters of wash suits
of 100 per cunt cotton content shall be at the rate of 85
cents (85(0 per hour, and the minimum wa ,e which shall be
paid to off-Dressers of wash suits of 100 per cent cotton
content shall be at the rate of 60 cents (60^) per ho\ir.
'""(2) In the 'southern section' as previously defined,
(except Louisiana) the minimum wage which shall be paid to
cutters of Palm 3eache3,' lines, and similar wash fabrics
shall be at the rate of 90 cents (90?!) per hour; the minimum
97C2
which shall be paid to off-pressers of Palm Beaches, lin-
3ns and similar wash ■'■ Ics shall bi at the rati if sixty-five
(65$) cents per hour."
'"(c) That in the last p; f Article IV of the
C &e there be inserted after thi i r< "trade" following:
"Makers of sv. ds", so that th< c i pars ;raph
shall read as folio 1 ;:
"'"Tailoring to the trad< , makers of summer -;o'ods and manu-
facturers of uniforms shall be permitted overtime at regular
rates during peak seasons, the number of h iurs and number of
eks to be determined by. the Men's Clothing Code Authority."'
"I would like to say that for the purpose of this hearing tli
is associated v:i th the Deputy Administrator in charge, Mr. ¥. B.
Himes, of the Industri; : . Conference Board, en my extreme left;
M-r. ;;. S. l.Iassel, of the Consumers' Advisory Board, and Mr.
Sidney Hillman, of the Labor Advisor;/ Board. Br. Earl B. Howard,
by Administrator, is associated with me in the cons ice rati en
of this natter.
"Dr. Sogers withhold the issuance of that 3: i cutive Order until
the cotton Garment Cod.e was approved ~uy the President, so that
amended Clothing Code and the Cotton Garment Cede would
agree in their definitions. When the time came for the sub-
mission of the Cotton Garment Ci di , Mr. Hunte ', representing
the proponents of that Code, claimed that they had not received
adequate notice of the learing which was held in September
25 and 26, in that whili they were notified. )f thi ".caring, they
were net notified as t< xactly what was to be considered at
that hear ng, and he held that their members were not repre-
sented at and wen n t ■ and by, the c el .ions reached or
reements reached as to the result if that hearing, and. he
declined to assent to thi Code as submitted unless the defini-
tion of men's wash suits was included in the code as submit-
ted to the President. The definition was included, with 3
provision thaet the matter could be determined by the Admini-
strator, as I read in ning remarks.
"The real purpose, theref re, of this hearing is to have
those interested, if the:- wish, show cruse -why the Executive
Order as proposed by Br. Rogers, drawn up for submission to
the President in accordance with the agreements reached after
the hearings on September 25 and 26, should not bi issued."
B. Approved Be f i ni tie r. s .
Howev r, no really satisfactory solution ar decision was reached,
and definite ns on the- ;; rment: as finally inserted in the approved
~ tton Garmcnt'C . ... the nature of c : surrounded
qualifications.
9782
-332-
"Articlc II — Definitions
"A. Ac c.siu in this Code the terra 'Cotton Garment Industry'
means r.nd included the production oy any of the following
processes:****, of any article or garment "mown as
"(l) work clothing, work garments, work pants and
children's plry suits. ***
"(lO) men's rnd boys' pants in chief content if
cotton.
"(14) men's cotton wa.sh suits.
"The products covered by Section A, paragraphs 8, 10, rnd 14,
are included in this Cede pending the prompt holding of such
further herring en such notice as the Administrator in his
.discretion may fix, and the final extermination of whether the
definitions ;f rny of them shall be modified or eliminated'
or whether any of the subdivisions' shall continue to be in-
cluded in this Code.
"D. If and when, becau.se of the character of rny product
made by rny employer or by any sub&i visional industry, there
arises any dispute as to v/hether such product is covered by
the provisions of this or another code, the code authorities
concerned will report to the Administrator the code under
which such product properly belongs- anc' in the event that
the code authorities are unable to agree within a reasonable
time, the Administrator, may, after notice and hearing, de-
cide under which code the product of subdi visional industry
manufacturing the same is covered. "
E. Air. .'roved Hou r Prev isions*
"Article III. — Hours
"A. Ho manufactuering employees shall be permitted to work
in excess of 40 hours in rny one week, or more than 8 hours
in rny one day.***"
P. Approved Waj°;e Provisions. ' '»
__i_i _ . , — t — . ^ ,
"Article IV— Wages
"A. Except as hereinafter provided, no employee (except
actual learners, etc.***) shall be paid at less than the
rate of 30 cents per hour per 4-0 hour week***in the
Southern section***, n r at less than the rate of 32g cents
per hor.r oer -'0 hour week***in the Northern section. "
9782
•-333—
Article III r.lso required an iramei L?ti i vesti - tiou .„■ the
Code t i '3 tc ivl'.f.tl c I '-. ir w« 1: v/r.s re suit in in
sufficient r sea em; ym , so bhi t ehe Acini iintr; iion mi -at
determine if t or; si ; L< be reduced further, So it v/rs ap-
parent tl\j i -0110 Cotton Q-f.rment Code vrs r proved "by' the Administration
with r ;reat i ?n; ais ;ivin^s as to itr successful operation and with
the i\di:/, that mmy changes and amendments nbul< have to be mai -
almost immediately.
9782
~334~
CHAPT2R III
AMENDMENTS TO BOTH CODES, DECEMBER 13, 1933
After the approval of the Cotton Garment Code, this competitive sit-
uation, especially on single pants, grew even more severe, many of the
Men's Clothing manufacturers insisting that their business uas very ser-
iously threatened by the difference in wages, hours, and classifications
provided in the two Codes, and the Admini stra.tion decided that immediate
further public hearings on the question were necessary, and notices were
sent out for November 27th and 28th.
I. Public Hearing November 27, 1933. on TTash Suits.
A. Objections of Cotton Garment Industry.
Mr. Hunter, of the Cotton Garment Code Authority,
manufacturers of work pants and overalls who also made
suits, claimed that these cheap cotton wash suits, who
$31. 5H a dozen, were produced in quantity lots in the
manner and were in no way competitive with wash suits
made by the New Orleans firms and others and soli for
they should be made at the same minimum wages and maxi
and all other Cotton Garment Industry products. (*) He
tion data from eleven (ll) of the twenty to thirty cot
turers of these suits.
speaking for the
men' s cotton wash
lesaling at $24 and
cheapest possible
of seersuckers, etc.,
dress use, and that
mum hours as overalls
submitted produc-
ton garment manufac-
Pirst Nine (9) Months of 1933
Men's Wash Suit Production and Dollar Volume ( **)
"Suits
Dollars
Percentage
wash suits to
Production
25, DO®
14,400
40,500
65,900
6,000
36,100
1,164
116,000
10,320
2,875
18,000
336,800
$75,
46,
101,
145,
14,
72,
4,
203,
17,
11,
90,
OOn.00
800.00
280.00
550.00
000.00
000.00
380.00
000.00
200.00
500.00
000.00
78J,70~.00
7>
6$
33$
66$
48$
16$
60$
Ts^' 1
(*) Transcript of Hearing on Cotton Garment Industry, November 27, 1933,
pages 13 to 26.
(**) Transcript of Hearing on Cotton Garment Industry, November 27, 1933,
Page 178, AND Page 13.
9782
Mr. " : . G. Urban, of Stahl-Urban Conpany, stated: (*)
"The type of men's rash suits made in work clotlr.ng plants
in the main are not in direct competition with the type of
wash suits made under the clothing code for this reason.
Our means of distribution are through the jobbing or whole-
sale trade principally, and these garments: — these garments
are sold in these wholesale-jobbing plants through their
work-clothing divisions, and by their work-clothing salesmen
in all rural stores, and the snail agricultural general stores,
for the low income class.
"I believe it is generally true the garments sold by the cloth-
ing people under a clothing code is sold direct ~by their agents
or their own men to clothing stores, men's specialty shops, and
clothing departments of department stores.
"These are for the medium and higher income classes; one is a.
semi-tailored garment aid the other is a pure machine-made pro-
position.
"I know from errperience in trying to sell these garments in
stores where the garments made by the clothing people are sold,
that we absolutely have no standing or no consideration. They
tell us it is work clothing and they could. not use it at any
price, and we have never been able to. sell that type of store
even if we so desired.
"I feel that the criticism of unfair competition which I believe,
has been mr.de, in view of the above, or the conditions as out-
lined there, from our own experience, is incorrect, and it is
vital that they stay as they are now classified,, under the Men's
Cotton Garment Code; otherwise, there would be — well, we just
cannot make the suits and. compete. under the increased costs
necessary under the clothing code.
"There is still another factor that is vital — and I think that
is the consumer's angle, this being produced primarily for the
low income class-^-but- with all die regard for the labor involved,
the cost should be kept as low, on as low a plane, for that type
of garments, as possible. "
lir. Sidney Hillman, of the *T.R.A. Labor Advisory 3oard, claimed that
the direct labor cost on this type of cheap wash suit would only be about
40 cents per suit, and that even if t ey were produced under the wages and.
hours of the Ten's Clothing Code, the increased cost per suit would only
amount to about S cents. I'r. Hunter vigorously denied this, claiming that
the ultimate price increase to the consumer would be. much greater. (**)
(*) Transcript of Hearing on Cotton Garment Industry, Tovember 27, 1933,
Pages 26 and 27.
(**', Transcript of Hearing on Cotton Garment Industry, Tovember 27, 1933,
Pages 28 to 30. -
9782
. -336-
3. Arguments of Wash Suit Manufacturers
Mr. Joseph Hasoel, representing the New Orleans rash suit manufacturers,
claimed that these wash suits were in no way competitive with woolen suits,
that they were really a separate industry, and again asked for a separate
code; as a large proportion of their production was linen suits, they
were arguing for "both cotton and linen garments, and believed that their
position was fully understood "by the Administration. "When this brief
was prepared by us giving our reasons for entitling us to a separate code,
independent of the clothing code, because wash suits were not in competi-
tion with woolen clothing, we had no reason to suppose that our request
would not be granted. As a natter of fact, we were led to believe that
we had won our case and we were amazed to find that linen suits had been
taken away from the wash suit group and put into the clothing code." (*)
But linen suits were placed under the Ken's clothing Code, and they then
attended the hearing of September 26, 1933, as a result of which Dr.
Lindsay Rogers drew up the proposed Executive Order on this overlapping
problem.
"At the termination of the hearing, while the Administration
made no direct ruling, it was very apparent that he was going
to place all wash suits in the men's clothing code, and we
might add that informally he so stated to members of our group,
and suggested that we get together with the representatives of
the three manufacturers who were present, who were members of
the Men's Clothing Code, and with the Labor Adviser, and work
out an agreement under the clothing code..
"We then .went- into a conference lasting from about 7 p. m. until
well after midnight.
"Certain terms were offered to us by the representatives of
the three manufacturers in the Ken's Clothing Code, from which
they refused to recede whatever, and we, believing that there
was no recourse to be had from the ruling which we loiew tha.t
the Administrator intended to make, placing us in the Men's
Clothing Code, and believing these to be the best terms pos-
sible attainable, and much against our better judgment, capit-
ulated, and accepted their terms. However, before finally con-
senting thereto we asked that the matter bo held up until the
foiling morning, when we might confer with the Administrator.
"We were informed that unless this offer were accepted, then-
they would withdraw it. Under these conditions we accepted." (**)
Mr. Elmer L. Ward, of the Goodall Company, objected 1 that the proposed
differentials in the Executive Order were not- sufficient to be of any as-
sistance to his company, manufacturers of "Palm I! each" suits, and also
asked that a separate wash clothing: code be established.
(*) Transcript of Hearing on Cotton Garment Industry, November 27, 1933,
Page 39.
(**) Transcript of Hearing on Cotton Garment Industry, November 27, 1933,
Pages 42 and 43.
9782
-337-
:;r. HasiDel stated that rates of ^ipy in these Few Orleans plants had
already been increased 85^,. and eny further increase over the 30 cent an
hour rate would be an almost fatal hardship.
"Ue have increased the rates of raj' in my particular factory,
and that is typical of every other factors'- in Few Orleans,^ 85
per cent over the pay that previously existed, before the pas-
sage of. the iT.R.A.
"T7e feel that if we are changed f r ^m a 30 cent an hour basis to
a 35 cent basis, that is a difference of one-si:cth or 16-2/3 per
cent. Our cost of labor today is 185 ner cent of what it was
previous to the IT.R.A. , and this 31 per cent will increase our
cost — -will make out cost 216 per cent of what it was before the
N.R.A. In addition to that, when we cut down the number of hours
we calculate 40 per cent of the cost is that cost effected by a
change in hours, which would increase that 4fS, which would make
our pay 22C -ner cent of what (what) it 'was -orevious to the IT.R.A.;
in other words, we have substantially increased our pay. " (*)
C. A^ruments of Men's Clothing: Industry .
Mr. Leonard T/einberg, appearing for the Men's Clothing Code Authority,
claimed that these men's wash suits' were competitive with tropical worsteds
and other summer clothing produced by men's clothing manufacturers.
"Are, or not, these garments which our friends talk about competi-
tive with those manufactured of other materials?
"First, we say they are competitive, in the manner of their manu-
facture, and in the manner of their sale by the manufacturer, tha.t
the materials, .whether tney by seersucker, Toalm beach,' tropical
.worsted, crashes,, silk, or whatnot, they enter into the manufacture
of summer clothes, and as summer clothing, are considered as one
class by the manufacturer. . /
"They are considered by him as 'one class in the laying out of his
line, not only that, but in the method of manufacture, and they go
through the same method <cf manufacture in the plant, regardless of
whether they happen to be made out of cotton or silk or crash or
whatnot.
"The difference, if any, in the manufacture of clothing, we re-
spectfully submit, are differences based on the standards that the
particular manufacturer may care to set up for himself; in other
~ords, whether he wants to manufacture fine clothing, or moderate
priced clothing, or cheap clothing, but it is determined entirely
by the standard, and not by the type of material which he happens
to be using.
(*) Transcript of Hearing on Cotton Garment Industry, November 27, 1933,
Page 81.
9782
-338-
"If he wants to make fine seersucker, or palm "beach, he lays
out one method; if he wants_ to manufacture palm beach suits,
or cheap seersucker, or linen, he lays out a cheaper method
of manufacture, so that the difference, if any, is only a dif-
ference in the standard that the manufacturer himself sets.
"In relation to the sale of this line of clothes., and we are
talking here of summer clothing, as distinguished from winter
clothing, yet when we come to examine it, it is all clothing,
all one article, whether it happens to "be made of one material
or not, but when we come to talk about the sale of this line
of clothes to a retailer, against a summer line of clothes,
it is displayed in exactly the same manner to the prospective
retail purchaser by the manufacturer as any other line of
clothes, there is no mark of differentiation between the two—
the seersucker, the linen, poplins, or whatnot, or the tropical
worsted. They are different manufacturers of a summer line of
clothes. They differ in price, yet as I shall point out to
you later, that very difference in price is an overlapping,
because seersuckers and linens and poplins and worsted in
wholesale and retail prices overlap, and there is no near line
of distinction marked between them." (*)
"We say that ■cutting them under this Code grants them an
absolutely unfair competitive advantage and in direct violation,
if you. please, of the spirit and of the letter of the National
Industrial Recovery Act, first, because it gives them this dif-
ferential in price. I am not talking about the differential
because of the locality, South or North. We make no complaint
about that, but we say the differential they should suggest by
coming under the Cotton Garment Industry gives them a very de-
finite differential in price, which is in direct violation, of the
spirit and intent of this Act, which was to see to it that there
should be no unfair conroetitive disadvantages or advantages be-
tween people in the same industry.
"These differentials result in an increase in the selling ;orice
of at least $1 to $1.50 per garment, or from 10 to 20 per cent.
There is not any doubt a,bout that,
"Secondly, to seciire this other advantage by coming into the
Cotton Garment Cod.e — -under that code, apprentices, 10 per rent
of the total force, are permitted, with a wage of 25 -oer cent
less than the minimum, for a period of six weeks. Ho learners
are permitted under the Clothing Code.
"They get the other advantage where all employees under the
Men's Clothing Code, earning in excess of the minimum, must be
continuous. They escape that.
(*) Transcript of Hearing on Cotton Garment Industry, November 27, 1933,
Pages 91-92.
9782
-339-
"In addition to that, cotton garmer.t manufacture rs under their
code may operate machinery for more than one shift. Under the
Clothing Code they may not;. and if they are to be given all of
these advantages, we submit th-t they are "being put in a position
where they can compete with us unfairly in price, in manufacture,
and in every other direction and situation." (*)
Mr. Weinberg also made the following statement, claiming codes were
"In id out to cover industries, and that all manufacturers of the article
should be included under the Codes. — We contend that it is not the mat-
erial — it is not the material which characterizes under which Code the
article must go, but the article, not the material." (**')
Mr. Malcolm Lauchheimer, representing!. Greif and 3ro. , J.
Schoeneman, Cohen, Goldman •& Co., etc. all manufacturers of summer cloth-
ing, further claimed that these firms directly competed with the New
Orleans group. (***)
"Mr. Administrator, Mr. Godchaux has made the mistake of
classifying clothing as woolen and cotton goods. Clothing
is classified into heavy and summer clothing. We are re-
presenting the summer clothing manufacturers.
"Those summer clothing manufacturers do manufacture, in the
same factories and with the same employees, cotton wash suits
and woolen summer goods. They are directly competitive, and
these manufacturers sell in competition with Mr, Godchaux.
We have here manufacturers who can testify that their methods
of manufacture are the same and their factories are used for
the same purpose.
"We also have a retailer from Baltimore who will testify that '
he purchases cotton and cummer woolen clothing as part of the
same schedule. We sell at one time cotton goods and woolen
goods as one line.
"There is no other industry in the cotton garment code which
competes with men's summer suits— men's wash suits. They do
compete with every manufacturer covered by the men's clothing
cod^.
".Judge Walsh spoke of utilitarian garments. What he means by
that I do not know. There is a separate heading under the
Cotton Garment Code of work garments which is in there, and we
do not ask that it come out. We are speaking only of dress suits
that are not competitive. It does not require testimony to show
they are competitive.
(*) Transcript of hearing on Cotton Garment Industry, November 27,
1S33, Pages 98 and 99,
(**) Transcript of Hearing on Cotton Garment Industry, November 38,
1933, Page 25.
(***) Transcript of Hearing on Cotton Garment Industry, November 27,
1933, Pages 170 to 172.
2782
-340-
"There are three things in the Act that are required in
■promulgating a code. The code must 'be on© "of -fair com-
petition, to do away with unfair competitive practices.
That is the first thing. I say that T 'r.-" Godchauskx in-
dustry is directly competitive with the summe-r goods trade
in the clothing industry.
"The second point is that the code must he truly representa-
tive of the trade or industry. I cannot conceive that cot-
ton wash goods are a separate trade and industry. Certainly
if I huy a cotton wash suit I will buy one less woolen suit
for summer wear, and I am typical of millions of other men
in the north. Cotton wa.sh goods, it is true, are new things
in the north, hut they are established and they are estab-
lished ae competitive of linens and of tropical worsteds.
•Three years ago I had never worn a '.''ash. suit. I do now. I •
wear tropical worsteds. Last jrear I bought no summer worsteds
but bought a seersucker.
"The third point is that the code must be -oromultated so as
to induce and maintain united action of management under
Government' sanction and supervision. You' cannot do that ex-
cept with a unified code — one code over two industries and
not two codes over one industry."
Mr. L. S. Goldsmith, representing the Goodall Company, presented the
following arguments for the wash 1 suit grouri: • ■
"The main contentions that re have to make are,' Very briefly,
as follows:
"1. That professor Rogers clearly expressed his views that
special consideration be given the wash suit industry. This
was done after a day-long interchange of arguments.
"2. That Mr. Hillman expressed a willingness .to consider
that contention.
"3. That the chief reasons for this special consideration
are
"A. Manufacturing differences; unskilled operators
doing unskil n ed and sectional work; differences due to wash
construction. l
"B. Fabric differences — '50 per cent of our output is
white; 85 per cent of our output is light-colors, entailing
additional laundry tax. .•..'. ■•' ■•
"C. Short season as compared with worsteds, etc. Since
our suit does not take the place of wool or worsted, hence the
consumer is not willing to bay the ;orice he will pay for 'a
suit that can be worn for a longer season.
9782
-341-
"D. A new industry giving new employment to mills,
manufacturers, retail merchants, and laundries is in the
making, growing steadily, and should not be throttled by
conditions that do not apply to it.
"Finally, that there should be no discrimination in re-
gard to the type of fabric or suit entitled to such con-
cessions other than that they be wash suits." (*)
(*) Transcript of Hearing on Cotton Garment Industry, llovember 27,
1933, Pages 175 and 176.
,78:
II. Public Hearing November 28,. 1933, on Single Pants - Deputy
Administrator 3. H. Gitchell, presiding* opened the hearing
with the following statement:
"Hoping to get some light on the subject, I ashed
for an informal conference in Hew Yorh last week.
Mr. Hunter organized a small group of his people,
and Mr. Drechsler organized a small group from the
Men's industry to see if we could find some common
ground fcr a settlement of this problem, and a
recommendation which might be submitted at this
hearing. The rearest wo were able to get to a
solution was the general agreement on the part of
those representing the Men's Clothing Industry that
single pants made of denim undoubtedly should be
administered by the Cotton Garment Industry, and the
general agreement on the part of those speaking for
the Cotton Garment Industry that pants which are
made as part of a suit should be administered by
the Ci6thing Industry; so that we are confronted to-
day with a problem of trying to allocate everything
between those two extremes to the two Codes."*'
Prior to this hearing, Deputy Administrator Lindsay Eo & ers had
appointed George P. Dowling, of Strawbridgc and Clothier, Philadelphia,
Pennsylvania, to make a limited investigation of this pants con-
troversy.
A. He-oort of George P. Dowling
Mr. Dowling read the following report at the hearing held
November 28, 1933:
"The following report is the result of my
survey for investigation of the manufacturers
sent me by your assistant.
"I have contracted most of those on my list,
having spent one day in Scranton and two days
in Hew York City. I find that the men's and
boy's trouser industry are somewhat mixed up.
For instance, I find, in investigating the
plant of Halpern and Chiistenfeld of Hew York
City, that at least 95 per cent of their out-
put is manufactured of cotton fabrics, yet
they are listed under the men's clothing code
and we compare them to, for example, the
Hercules Manufacturing Company of Hew York,
who make at least 35 per cent of their products
from woolen fabrics, yet they are under" the
cotton code.
"I am going to use these names here, because
the names were on my list, and these are the
people that I visited.
(*) Transcript of Hearing on the Cotton Garment Industry, November 28,
1933, Page 7.
Q7ftS>
-343-
"That condition exists all along the line, and I,
myself, would "be unable to place any manufacturer
in any particular code under these circumstances.
My recommendation to you is that the entire in-
dustry of men' s and boys' trousers, whose prod-
ucts exceed 60 per cent made from cotton fabrics,
should be placed under the cotton code. If that
were done, I think you would find that the entire
industry would be placed in that code, but I find
in my investigation that the manufacturers as a
whole, would like the entire industry placed
under the code, regardless of whether it would
be clothing or cotton, and they would be satisfied.
"On this code, with the contact I made of the
several manufacturers that I called on, some are
on the. ..co"tton cede and some are on the clothing
code, and I. think the concensus of opinion given
then was to give them one code regardless, and
: they would be satisfied, as I said heretofore.
"As it is now, it would take a concern, such as
Happ Brothers of Macqn,. Georgia. In the boys'
knicker line, they are; highly competitive with a
house known as the ,0,'. TC,. , .Knee Pans Company,
Louis Rosenblatt, or '.'any other" knee pants manu-
facturer that' I have 'come in contact with, and
yet, they being under the cotton code, are in a.
position to undersell these three manufacturers
which I have named, who. are under the men's
clothing code, at a difference of at least 20
per cent, which to my mind, makes very unfair
competition.
"I can cite the same instance in the men's trouser
manufacture and would compare the Hercules, Meyer,
Isaacs, with Hr.lpern and Christ enf eld, Kalikow,
Brothers, Greenstone-Stern, Berman and Rafkin,
Most of those manufacturers are operating under
the Men's Clothing Code, and Isaacs, Hercules,
Moyer, Kalamazoo, Oberman a re" operating under the
men's cotton code, and they are all engaged in
practically the same line of business.
"The Anthracite Overall Company and the Lackawanna
Pants Company of Scranton, I understand, are- owned
and operated under the same owner. One was placed
under the Cotton Code, and the other under the
Clothing Code, but recently the Lackawanna Pants
Company has, I understand, been temporarily placed
under the Cotton Code, and I feel that if the ^
Anthracite Overall Company is under the Cottdn
Code, then the Lackawanna Pants Company certainly—
belongs there, also. A .V
" - . ■
9782
-344-
"I would be very glad to come to Washington to go
into this matter with you in mere detail, but I
certainly cannot see how this particular industry
can operate under two separate codes. It means
that those under the Clothin,! Code would not be
able to compete- with those under the Cotton Code
because of the difference in trie cost of at least
20 per cent or 25 per cent, and they all manu-
facture practically the same grade of garment,
"Therefore, if my recommendation or suggestion is
worthy of consideration by you, I most certainly
would recommend, as stated in another part of this
le.tter, that this entire industry, regardless of
who or where they may be, be placed under one
uniform code which gives them an opportunity of
meeting their competitors on a fair basis. Other-
wise, I am afraid that as it is now, those operating
under the Men's Clothing Code would be unable to
compete with those operating under the Cotton Code,
and the result will be that some of them will have
to close up their plants.
"I trust that this report will reach you in due
time and that a personal conference might be more
satisfactory. If so, please notify me and I can
assure you that I am at your service."
B. ArgmeBfcfcs of Men's Clothing Industry .
Mr. Joseph E. Brill, of the National Boys 1 Pants Manufacturers
Association, Inc., spoke as follows:
Rolls of fabrics, "one containing some -percentage of
wool, the other being all cotton, are laid on the
table on top of each other, marked at the same time,
and cut at the same time.*** ***lt is .quite obviously
impossible to apply two codes to the pants industry.***
The factor which determines the nature of the fabric
upon which the operations are conducted is the
season of the year: — December to June manufacturers
made practically all cotton fabric products, July to
November products consist of cotton, mixed cotton,
and a small percentage of ?/ool.***This pants business
does a volume of about $95,000,000 per year.***The
difference that exists today in the cost of manu-
facturin & between the two codes is between 20 and
25 per cent.***It is impractical and impossible to
operate a pants factory under two codes. All manu-
facturers- in the industry are in agreement that its
best interests can be served only by the application
of one code to the industry,"*
I*') Transcript of Hearing on Cotton Garment Industry, November 28,
1933, Pages 10 and 16.
9782
-345-
Mr. David Drechsler, Secretary of the Men's Clothing Code
Authority, submitted the following table of single pants production
for 1931:
"Reported under Men's, Youths' and Boys' Clothing
(other than work clothing) — Census of Manufacturing
1931
Fairs
"Men's and Youths' Suit Trousers 24,651,398
"Boys' Suit Trousers 8,850,629
"lien's and Youths' White Duck Uniform Trousers 4,040,862
"Uniform Trousers 748,925
"Hen's and Youths' Separate Trousers 18,523,055
"Boys' Separate. Trcusers and Knee Pants 12,806,088
"Snort Knickers '1,855,648
"Riding Breeches 1,383,132
72,859,738
"Work Pants
"Denim Pairs
'Overalls 49,402 ,596
Mork Pants 6,653,208
"Total Denim 56,055,804
"Overalls (of other cotton cloth)
10,566,464
"Total Denim and Overalls
(of other cotton cloth) 66,622,268
"Work Pants
"Khaki, Corduroy, Drills, and Woolens, 20,403, 824 pairs. "
And the following is a summary of his arguments for the
Clothing Manufacturers.
"I dare say there is not a clothing manufacturer in
the country that at some time or other docs not
manufacture single pants - one-third of the clothing
industry is the manufacture of pants. Is there any
line of demarcation between single pants anu. pants of
a suit?
"How you are going to put this clothing industry,
employing hundreds of thousands of workers, all
over the country, whose capital investment rates
in the billions, in an unfair competitive position,
because there are some twenty million single pants
that arc manufactured, which perchance you and I
cannot tell whether they are going to be used for
clothing, dress purposes, or for work. You know
hat I refused to put or comply with any request
to differentiate between suits unit pants and
9782
-346-
single pants, the figure is 68,000,000 some 33,000,000
pants made which are part of suits units, and 30,000,000
single pants, but those are all wool content pants.
Then there is a well-defined group to which the clothing
industry makes no claim - these arc pants made of denim
cloth and commonly known as work pants. Census figure
for 1931 shows total work pants was 56 million. So
you have 68,000,000 pair of pants where there is no
dispute that they belong to the Men's Clothing Code,
and you have 56,000,000 pants where we do not dispute
they belong to the Cotton Garment Industry.
"The pure labor cost of a pair of pants, in the men's
clothing shops, is about 35 cents. The differential,
as found by Mr. Dowling, in the cotton garment shops,
is 20 or 25 per cent. It would make a difference of
8 cents on a pair of -pants. You have 24,000,000 (in-
cluding 4,000,000 duck pants) pants in the so-called
'twilight' zone, and the people of this country would
be compelled to pay as a penalty for nutting these
24,000,000 pants in the clothing code, a penalty of
8 cents per pair - some $2,000,000. It will save the
standard of practice, hours and labor where it is
under the entire clothing industry and I say it will
bolster up the entire industry. You cannot cut l/3
of it and expect to have the other 2/3 stand up. You
will create a larger purchasing power of some 32
million single pants workers, and you will not hurt
those manufacturers of pants in the country who work
on denim. This 8 cents per pair will be spread over
the entire country and will create a larger con-
suming power. This is not profit, it is additional
wages that circulate throughout the country, and it
amounts to $2,000,000.
"There are some 6,000 workers that operate under the
Men's Clothing Code that make men's single pants,
and single knee pants."
Summary of Points Submitted Brief of Men's
Clothin Code Authority
1. Two codes cannot successfully operate in one factory.
2. There is no distinction in the skill of the worker,
nor the nlant and machinery, in making suit pants
and single pants.
3. There would be no means of identifying the two classes
of work. The workers would not know which they were
actually making. Enforcement of compliance would be
very difficult.
4. Any hour basis over thirty-six would tend to further
reduce the number of employees that can and should
be re-employed.
9782
-347-
5. Large numbers of workers haye already been put out
of work by the unfair conroetition of the Cotton Garment
Cole, and many more will be unless this condition is
c erected.
6. Ac iitional cost, per pants would be only eight cents
and permit thousands of workers to retain their jobs.
7. Skill and machinery, etc., required to make denim
pants and overalls, are different, and these should
remain under Cotton Garment Code.
Mr. Hyman Blumberg, representing the Amalgamated Clothing Workers
of America, said:
"The argument that you cannot adapt yourselves to
40 cents an hour ere only arguments that involve
prices. Price, if you are today living up to your
32% cent an hour — if you are paying 33§ cents an
hour, then the problem would cone to from 5 to l\
cents additional labor cost on a pair of pants.
"The 40 hour week does not enter into it, because
if you pay 40 cents an hour the 40 hour week does not
remain a problem, becs.use after all I question
whether all of the pants that are needed in this
country cannot be made by the factories you gentlemen
operate, and made at the convenience of the public on
a 36 hour week, so the oroblem is one of cost, and I
will say the cost problem would not exceed from 5 to
l\ cents on a direct labor cost of a pair of pants,
and for the Administrator to permit you gentlemen to
operate on a 40 hour week and 32jjr cent minimum in the
North and 30 cents in the South will be sewing the
seed for complete disintegration of a number of pants
shops today, mailing both men's suits and pants, and
j in & lc pants. "
In Baltimore there are from 15,000 to 18,000 pairs of
pants made a week that are made by single pants manu-
facturers and a number of them make about 90^ cotton,
about 10 c i woolen. They are operating under the Lien's
Clothing Code, and they do not belong to any particu-
lar group — Mr. Brill's or Mr. Drechsler's. The shops
happen to be union shoxis. They went through this
season, but I question whether they will open up the
next season. They cannot stand the competition of
single pants manufacturers working under a Cotton
Garment Code.
"So, summing up, pants are conceded to be clothing,
leaving out denims, overalls, that mechanics wear.
In the Clothing Industry, the overwhelming majority
are under the Men's Clothing Code. The difference
is the cniestion of price;, the manufacturers want
to be fair to the public, and tack on the labor cost.
The labor cost only ".:ould mean from 5 to 8 cents in
9732
-348-
addition to the cost, depending on the efficiency of
the shop. That would be at the top, taking the com-
pletely inefficient shop, would be $1 a dozen in
labor, assuming you are paying 32y cents an hour.
"The worker will not object to payin^ that 10 cents,
if he knows by doing that he avoids confusion in
an industry employing 150,000 people." *
Mr. Miller, also of the Amalgamated Clothing Workers of America,
speaking in reference to the unfair competition by the Cotton Garment
Code plants, said:
"About fourteen or fifteen months ago we organized
thirty-five or forty shops in Brooks, Lehigh and
Montgomery Counties, Pennsylvania, host of these
snops are making pants. They do not discriminate
whether these pants come from one branch or another.
They make pants.
"In the springtime mostly they make them for
different cotton cloth manufacturers, because they
get what they call White Sanforized stuff. Some
shops make a. very high priced woolen stuff. They
make all kinds of pants, all branches. How you
can differentiate and how you can subdivide them,
I do not know, A number of them, I might state,
who also make ~ants for people in Few York or
Philadelphia who are legitimate suit houses.
"The shop in Pennsylvania, that I refer to, with a
capacity of about 9,000 to 10,000 pants per week,
is a shop that has been working full force for a
long time. The shop was working for Hew York
manufacturers and was v/orking under the Clothing
Code, 3,000 per week for the last two months, ITow
that shop, for the first time in a long while, has
been closed just because the manufacturer who lias
been supplying them with about 6.000 pants per vTcek
told me, "I can no longer supply their shop with
work beceuse I can get my stuff mad" up by con-
tractors all oxer the Southwest and TiTest ''ay manu-
facturers members of the I.A.G-.ii. ', ^.rid. if necessary,
I will tell you the names of the manufacturers in
priva/fce, and mention the name of the shop in question."*
The following letter indicates the competitive situation as
affecting those plants operating under union agreements with the
Amalgamated:
"We manufacture pants, the same type of pants that
virtually every other' pants manufacturer in this
vicinity makes, namely — all cotton pants, part ?/ool,
and all wnol .
(*) Statement of Mr. Killer, of the Amalgamated Clothing Workers of
America, Transcript of Hearing, November 28, 1935, Page 85.
9782
-34-9-
• 'understand that any garment that has any wool
content whatsoever comes under the Men's Clothing
Colo, and that the manufacture of cotton pants at
the present time has been assigned by Executive
Order of the President of the United States under
the Cotton Garment Code, with a $1? per week mini-
mum for 40 hours.
"We have, at the present time, a contract with the
.Amalgamated Clothing Workers of America, and in
view of that contract, the Amalgamated in our
contract shops is compelling us to pay a minimum
wage of $14.40 in accordance with the Men's Clothing
Code, on all types of product that we manufacture.
We are perfectly willing to do this if our cor-
petitors do the same, hut we understand that our
competing manufacturers are working under the
Cotton Garment Code, which requires them to nay
only a minimum of $12.00 per week for 40 hours,
thus giving them a decided advantage over us in
the price of manufactured goods, as the type of
employee in our contract shops is identical with
our competitors." *
0. Arguments of Cotton Garment Industry.
Mr. Sidney Moyer, Secretary of the Association Pants Manu-
facturers of America, said:
''We came down here on August 7th and spoke to
Dr. Rogers, and wanted to find out the situation
as to the pants situation.
"We believed that we belonged some place in the
picture. He told us to tell our story, and we
told our story, and we told them how much cotton
pants we made, and how many wool pants.
"we could not tell them exactly, and, as I am on the
staff of the Associated Pants Manufacturers of America,
Dr. Rogers told us to go out and find out just how
many were made, and bring in a report, and that we
would hear from him the next week.
"We sent out a lot of wires and got a lot of in-
formation. I want this report put into this record,
because I think it is very important.
"This report shows that the pants manufacturers make
not only pants, but overalls, coveralls, overall coats,
blanket-lined coats, play suits, work shirts, and
semi-dress shirts, blazers, lumberjacks, and a. great
ay other garments, all of which arc set forth on this
tabu lation.
(*) Letter dated October 23,1933, from the Hew York Pants Manu-
fac turing Co., Baltimore, Md. , to George S. Robertson, Jr. , Men's
Cloth-' ng Code Authority for Md.and Va. , Baltimore, Md. (Men 1 s
Cloth-' ng Code Piles.)
3782
-350-
"In this long list of garments set forth here, I might
say that these are all manufactured on the same ma-
chines, and by the same workmen, and on a quantity
production basis, low priced, and sold to the lower
income classes.
"In practically no instances are these peonle who arc
employed in these slants skilled T'orkers in the or-
dinary sense, "out they are simply machine operators,
or a little above that.
"These are made for the lower income classes, a.s I
said, and they are purely production goods for such
purposes.
"When we submitted these facts to Dr. Rogers, and to
the other proper authorities, they told us that we
belonged in the Cotton Garment Code, and there we
were." **
In reply to the questionnaire sent out by this Association, re-
plies were received from 130 of their members, giving data for 1931
on quantity 2">roduction, dollar volume, and percentage of pants by
materials. It is interesting to note that 45 of these firms reported
that they manufactured pants exclusively. The summary of these re-
ports is as follows:
" "Pants Production for 1931:
130 companies, except 69, 70 and 94.
Humber of dozens 3,098,760
Value of T^ants $36,346,219
"Percentage of Pants by Material's:
All cotton 86 *
Part cotton , 7.5 *
Wool 6.5
"Pants Production for 1931;
Average
Tumber of dozens ' 24,500
Value of Pants $300, 000
"Percentage of Pants by Materials:
All cotton 86 *
Part Cotton 7.5 *
Wool 6.5
(**) Telegraph reply reported total cf all cotton and part cotton as
cotton. If these had reported pants of part cotton it is es-
timated tha.t the average for all concerns listed would be 83.5
per cent all cotton, 10 per cent part cotton, and 6.5 per cent
wool.
(*) Transcript of Hearing on Cotton Garment Industry, November 28,1933,
pages 127 and 128.
-351-
"Pants Production for 1931:
Total U. S.
dumber of Dozens 5,151,600 (61,819,200 pants)
Value of Pants $85,562,000
"Pants Productions for 19.31:
Percent of U. S.
Number of Dozens 60^>
Value of P»nts 42.5^
"Pants Production for 1931:
Non-v7iol pants:
Associated
Number of Dozens 2,928,460 (35,141,520 pants)
U. S.
Number of Dozens 3,502,000 (42,024,000 pants)
Per Cent of U. S. 83.6''
420,000 dozen "'ool r nd part "'ool pants made by Ne-"* York grout).
5,000,000 -oants vool and part vool made by He^ York grout).
"Pants Prodtiction for 1931:
40 Concerns, P-°nts Only
Clumber of Dozens 1,013,321
Value of Pants ^11,639,529
"Percentage of Pants by Materials, 1931:
All Cotton 81
Part Cotton 10
TTool 9
" Pants Production for 1931:
90 Concerns
Number "of 'Dozens 2,085,439
Value of Pants $24,706,690
"Percentage of Pants by Materials, 1931:
All Cotton 88
Part Cotton 7
TJool 5*
Mr. 3enjamin 3erman, representing the Crorm Overall Company, of
Cincinnati, Ohio, "-nd the International Association of Garment Manu-
facturers, suggested the fcllo-'ing solution of this problem:
"I maintain there should be no change in the hours for the
cotton garment industry, '"hether or not those operators ^re working
on cotton pants or the cotton parment code.
(*) Atnendix of Transcript of Hearing on Cotton garment Industry, Nov,
28, 1933, Pages
9782
"Summing it up, we have selected ps the dividing line 100
percent all cotton -cants to be made on the cotton code prices,
and we suggest that woolen pants and cart woolen pants which
may he made by our manufacturers may be made on clothing price
of 40 cents and 37? cents : that the hours remain in the
cotton garment industry 40 hours.
( "Deputy Gitchell. Even ?s applied to wool or part wool
trousers?")
"Even as applied to wool and part wool trousers, for- this
reason, that the percentage of " r oolen and cart woolen
trousers manufactured by those operating under the cotton
garment code is small, and is net in my personal estimate
a vital factor to disrupt the whole industry.
("Deputy Gitchell. Tould that include the work cants made
of cheap shoddy? 11 )
"There is a definite line easily determined, the source of
supply of the material. All cotton garment code, anything
else wool code prices, 40 cents and 37- cents.
"There you eliminate the competition that is being com-
plained about for woolen cants.. The clothing peocle never
did make any cotton-cants- to the percentage they are to
claim to the Administrator.
("Deputy Gitchell. Are you authorized to make these pro-
posals for then?")
"Yes, I am authorized to make that proposal. "(*)
Mr. Herman A. Speh,' of the Drybak Corp., 3inghamton, N. Y. , sug-
gested a clearer definition of work pants, and filed the following brief
in support of his arguments:
"Mr. Administrator: 'Referring to our reauest of November
24, to you on hearing No. 15-13 to be held November 28 at
10 o'clock A.M., ve propose that paragraph 10, Section A,
•Hen's and Boys' Pants in Chief Content of Cotton' be elim-
inated entirely,
1. 3ecau.se this defines only one type of pants and
is ambiguous. Its only interpret- tion could be pants
of a material of which the value of the cotton is more
th"n 50 Per cent of the tot.-l value. It is impossible
in the ordinary course of business to determine the
ex ct cotton-value content of piece-goods, and it is
possible to conceive of r .re ter-ial mora than 50 per
cent cotton by weight but whose chief content or principal
value is in wool or r; yon. This paragraph, as it is,
(*) Transcript of Hearing on Cotton Garment Industry, November 28,
193 r :, Pages 156 and 157.
9782
I— r- i-t
**353»"
therefore, would be the cauee of many disnutes.
""o pants manufacturer deals exclusive in the materials
describe^ in paragraph 10, Section A. They constitute
only'n trrt of output and there is no reason why this part
should receive special consideration in the Code, In our
case, materials whose chief content is anything but cotton
are almost nonexistent.
""Ve call attention to the fact that 'work pants' are included
in paragraph 1, Section A, of the Code and that nants in
cnief content of cotton may be cither work nants or dress
n^nts, the distinction being in the r,tyle, tailoring skill,
and method of manufacture. Paragraph 10 is, therefore, in-
herently a -oart of naragranh 1 and should be eliminated.
We consider that this was recognized by Administrator John-
son in his recommendation to the President of this Code,
d' ted November 7, 1923. (See United States Printing Office
cony of the Code, Page 3, second paragranh.)
"On this nremise we argue that a work nant is a type of
uroduct which had been made and distributed for years in
large volume and is usually recognizable by (a) its mater-
ial, (b) by its method of production, (c) tyne of con-
struction (d) by the channels of distribution through which
it moves and (e) by the tyne of consumers who nurchase it
and the use to which it is Put.
( n ) Material may be all cotton such as cottonadcs,
khakis, denim, -prints and ducks. It may be oart wool
usually "'ith a cotton warn, and a small percentage
(25^ to 40^) of shoddy "-ool filling. It is easy to
recognize material used for work nants.
(b) The characteristic method of -production of work
■o~nts is a table lay, cut a? high as 96-nly, of as-
sorted sizes on standard patterns or stencils and
defending upon the length of the cutting .tables, in
auantities as large as ninety-six dozen on one table
and at one time by oo'-er driven knives. The cut
nieces are then bundled in lots of one or t-"o dozen
garments, denending unon the weight, which the machine
onerator has to handle without nrotection of the gar-
ments ag-'inst outside damage.
Prom this noint they move to the sewing rooms, where
they aire processed on po—er driven machines arr-nged sec-
tionally and moved through a regular series of stitching
onerations to comnletion. Operators are usually skilled-
only in the narticular cneration and machines on ""hich they
work and are reouired to have no tailoring skill. No hand
onerations are performed. Pressing is done by nower-driven
machines ^nd oractically all onerations Pre na id by niece-
work ner dozen or ner hundred. Almost all ooerators em-
ployed in this nroduction are women.
9732
*354~
(c) As to type of construction, the patterns are crude
and inexact as to line compared to dress pants. Trim-
ming materials such as buttons and pocketing are less
expensive. Methods of seaming not -remitted in dress
pants, such as. double or triple 'seams; are used; raw
out edges ore not trimmed to the extent of dress oants.
Speed of production and strength of "/erring ouklities
are the principal aims.
Hone of the pants are made to match other garments,
such as coats or vests, hut are made'ris single garments
to serve a particular purpose in work or Play. On such
an understanding, there disappears most of the difficulty
outlined oy General Johnson on Page 7 of the printed copy
of the Code, second and third paragraphs.
(d) The distribution of '"ot:: pants has characteristics
very distinct from that of Press pants. Work pants
liave always been distributed either through the whole-
saler ci dry goods or general merchandise to retailers
on the side streets of lar^e cities or in rural towns.
It distributes direct to the 'retailer, they have been
sold to the small side street 'retailers and not to the
department o^ first-class men's clothing stores. The
common unit of sale by manufacturers and jobbers is one
dozen.
(e) Work pants are pnrch sed by and worn by the farmer
and the working man pnfl the retail stores which sell
it to him are located in the railroad rnd industria.l
centers and in the smaller cities nd villages n djacpnt
to the farming area.
"We point out that the Department of Commerce has associated
work pants always -"i.th the types fof articles also listed
in Section A, paragraph 1. (See Surea.u of Census Form 308
for 1931, Page: 3, line 39,) ' "V argue also that this same
Department has always associ* ted, fs competitors for the
Consumers' favor, work pants and overalls. (See their re-
ports for the last three years on work clothing.) There-
fore, work pants and overalls must be in the same Code and
produced under similar conditions of wages and work weeks.
"From IG-20 Q Department of Commerce, "Bureau of Census, re-
leased January 22, 1932, Page 2, last two paragraphs, in-
dicates that Bureau has always regarded the work pants and
other articles listed in the Cotton Q-arment Code as a dis-
tinct industry from men's, youths'' and boys' outer clothing.
"Because w e believe that a work pant is easily recognizable
once the general conditions surrounding it are understood,
we, therefore, propose that paragraph 10 be eliminated and
9782
-355-
That the Question rt issue be settler 1 by a definition of
;i 7ork: Pants' in paragraph 1, to be added to the Code along
the following lines:
"'"ork pnnts, as used herein, Cleans and includes men's and
boys' pants of cotton, or ""hose chief content by weight is
cotton, produced in substc'nti^ll ,r the same rarnner as the
other garments specified in Section A by oner- tors employed
on sectionr.l ioo'-er machine work, ;, nd which garments do not
reauire tailoring skill.'
"In this brief v, e rre speaking primarily for our own com-
pany. Because of our long experience 3 nd acaualntance in
the trade, " r e believe that our proposals would be subst^n-
tially approved by our cormetitors. "( *)
Mr. J. L. Wines, of the M.R.A. Labor Advisory Board Pnd of the
United Torment Workers of America; spoke as follows in suggesting tha.t
pants of all cotton be placed under the Cotton Garment Code, and those
made with part shoddy r nd/or wool be placed under the Men's Clothing
Code:
"Speaking as n represent; tive of nn international labor
organization that has agreements with •" number of employers
in the work clothes industry, work clothes and shirts, I
am of the opinion tha.t two codes in the industry will
not work out satisfactorily. I am ashamed, however, of
the wage rates that -"e in the Cotton Garment Industry
Code. They mean nothing at "11 to our membership that are
employed in this industry where we have union agreements.
Directly they mean nothing to cur membership because w e
do not receive one Denny incre? se in wages; their hours
'"ere not shortened because we have in our agreement the
forty hour week since 1931. We contended in 1931 with the
union-ma.de association committee that there was not enough
work to ever keen their factories operating eight hours per
day, five days a week. There has nothing happened in the
industry since tlv t time thf t "'ill cause us to change our
minds. I T o one of our plants, not one, have operated forty
hours p week since 1931, averaged forty hours per week.
Many of them may hnve a fe^ weeks at a time thr-t they have
worked full time, but the mrjority h^ ve not worked more
than thirty hours per week, or thirty-five rt the most.
Indirectly our membership and employers whom we hrve had
the pleasure of dealing with, rre benefited even by the
minimum, and even if that is only thirty cents oer hour
in the South and thirty-two cents in the Forth. They have
( *) Brief present?" by the Dryb ;: >: Corpora tion, Inc., Singhampton,
". Y. Transcript of Hearing on Cotton Garment Industry,
November 28, 1933-, Pages 179 to 184.
9732
-356-
benefited because of the unfair competition of the non-
union manufacturer who, in many localities, ha.s been oaying
as low as $2.00 and '3.00 -oer Week and working as :iiany
hours as the state lows would "Hermit them to work women
employees.
"TTe are of the opinion that the minimum scale on nants
that are made of all cotton shall be, as now, in the
Cotton Garment Code, and that the minimum scale on t)rnts,
the material of which they are made is of shoddy or of wool,
be changed to forty cent- in tie jTorth : nd thirty-seven
and a half cents in the South.
"The question of hours should be taken U" as the Code pro-
vides for, within a period of sixty days from last Monday.
I do not think we are going to solve the unermlo'inent
problem unless we --dont r thirty or thirty-five hour v 'eek
and increase the minimums of our Code."(*)
Judge Raymond A. Walsh, counsel for the Cotton Garment Code
Authority, expressed similar views, r s follows:
"You must realize that you are dealing v, ith a utilitarian
g rment again, and it is going to a certain class of cit-
izenship, and these goods "■re the stock of the poorer class
of merchants, and are to be sold to those "ho can only af-
ford a few cents to oay for a ->air of -iants. If you can
take cotton oants from t e Cotton Garment Code it will
have the most injurious .and disastrous results, as sho^n
by the lengthy table submitted here; r> n nts have been manu-
factured in a number of factories where" they "or odu.ee goods
of a utilitarian workman char cter, Work clothes, "ork
pants, and so forth. That is "L't those factories special-
ize in, en^ these ,r 'ork oants are produced merely along with
the other tyoe of goods so' produced, "nd for the same
general utilitarian, low cost-, 'low resale value tyne of goods
"I thin: th; t if you tjI; ce the cotton garment minima on
pants in 100 wr cent of cottor, or oants chief in content
of cotton, as you will, and vlr ce n differential, as I
said, in the Cottor: Garment Code on wool w nts and on wool
mixtures, th? t will settle that situ; tion. Then, as I
said, you can take un the hours under the orovisions of
the Code ■
ir ' T e asked the clothing manufacturers to assist us in
fighting convict labor five years ago. I think Mr. Punter
will testify th; t they never contributed five cents to the
camoaign, and they showed absolutely no interest in it,
because they did not feel this great competition from the
cotton clothing, they did not feel the conmetition of these
thousands and hundreds of -thousands of dozens of oants that.
(*) Transcript of Hearing on Cotton Garment Industry, Nov. 2R, 1933,
Pages 212 and 213.
97R2
-357-
h ■ vc been dumped on the market ~'or the last twenty-five
years. They did not feel that • ny more from the convict
labor, thin they have felt it from the work in our plants."
Deputy Administrator Gitchell closed the hearing with the follow-
ing statement:
"The Question to be settled is involved and difficult,
and there Questions will receive our best and most earnest
and careful consideration.
m "e would be extremely grateful, and I believe the indus-
tries win be better served, if it were still oossible for
those representing the clothing industry and the pro-
ponents of the Cotton Garment Code to find it -oossible to
get together and recommend a solution which they believed
would enable the industries to operate to the best rdvnntage
for themselves and their employees find the consumers whom
they are serving.
"If you do not get together in that manner, of course the
duty is then upon the Administr tor to make a decision
which can not, I believe, be ■" r wise :i s th' t which you are
capable of making by negotiation, conference and agreement
for yourselves. "( *)
III. Changes in the Two Codes as Approved on December 1R, 1933.
All these public he' rings and subseouent conferences between the
various groups failed to produce any agreements satisfactory to the
Code Authorities and the manufacturers of these disputed articles.
It therefore devolved upon the Administration to inaugurate the
changes in definitions pnd w?.ge and hour provisions which would appear
to offer the most satisf ictory immec i te relief to the very tense
c ompe t itive s i tua t i on .
G-ener; 1 Johnson's letter of transmittal to the President, dated
December 1-;, 1933, gives a, very complete picture of the controversy
and the various phases of it up to that time.
A. lien's Clothing Code Definitions and Wages.
The Men's Clothing Code was changed as follows:
Article I. (Definition), which read: "The term 'Clothing Indus-
try' as used herein, is defined to mean the manufacture of men's, boys'
and children's clothing, uniforms, single knee pants, single p : nts ,
and men's summer clothing (exclusive of cotton wash suits}," was
amended so that the expression "single pants, men's summer clothing
(exclusive of cotton wash suits)" wrs changed to read: "single pants
(*) Tr-nscri-nt of Hearing on Cotton 5j rment Industry, November 28,
1933, Page 226.
9732
."358-
(rxcrnt wor< n->nts or single pants v hen w de in work-clothing factor-
ies) and men's summer clothing (except men's wash suits of 100 '"■ cotton
content, when mft.de in work-clothing factories in conjunction' with work
clothing) . "
The second paragraph of Article IT, which re- f' as follows:
"The minimum wage paid by employers to employees working 'on single
knee pants shall be at the r te of thirty-seven cents (374) ner hour,"
was deleted, and in its place ,5r s inserted.: "The minimum wage naid
by employers to emoloyees working on single knee pants and/or single
pants shall be at the rate of thirty-four cents (344) ne^ hour when
employed in the southern section of the industry, and thirty-seven
cents (37(0 tier hour when employed in the northern section of the in-
dustry. "
The following wording w; s < dded ; s the third naragranh:
"The minimum wage paid by employers to employees working on
men's wash suits of one hundred ner cent (i.00i) cotton
content, shall be at the r te of thirty-four cents (344)
per hour in the southern section of the industry rnd thirty-
seven cents (374) -per hour in the northern section of the
industry; the minimum wage naid 'oy employers to emnloyees
working on men's summer clothing (other th; n men's wash
suits of one hundred ner cent ( lOCyt) cotton content) shall
be at the r- te of thirty-seven cents (374) ner hour in the
southern section of the industry, and forty cents (404)
ner hour in the northern section of the industry."
At the end of paragraph (a) of Article II, which read ' s follows:
"(< r ) On and after the effective date, the minimum wage
which shall oe naid to cutters shall De ' t the. r' ; te of One
Dollar (Al.G'v ner hour, ' 3 nd the minimum wage which shall be
naid to off-r>res c ers sha.ll be at the r te of seventy-five
cents (754) r>er hour,"
was added the following expression:
"except that in the southern section of the industry the
minimuTi wage which sha.ll be paid to cutters of r, ll men's
wash suits and/or summer clothing shall be at the rate of
eighty-five cents (354) ner hour, and the minimum wage which
shrill be naid to off-pressers of such garments shall be at
the rate of sixty cents (604) ner hour."
3.. Cotton G- rment Code Definitions and '"'ages.
The Cotton Garment- Code was changed as follows:
before Article II was amended, Section A, Subsections 10 and" 14
read: "(10) Lien's and Boys' Puts in chief content of cotton," and
"(14) lien's cotton wash suits." As amended, tnese subsections were
made to read: "(10) lien's and Boys' pants, when made in work-cloth-
9782
-359-
ing factories, and ''(14; Men's wash suits of VW- cotton content, when
m-dc in work-clot, .ing f; ctories in conjunction with -or): clothing.' 1
C . Conditions in the Or^cr of AttovI.
"1. it no mamif." cturing employee eng ge<^ in the production
of men's rash suit? of one hundred Der cent (l'~o') cotton
content Find /or men's r.nd boys' writs -hen cither of the fore-
going is ran.de in work clothing f- ctories in conjunction with
work clothing o^ ^ork pants, shall be -oriel Ft less than the
rate- of" thirty-four cents (3<A) per hour in the southern
section of the industry, or less than thirty-seven cents (37#)
^er hour in the northern section of the industry.
"2. It is hereby orders that an Inter-Code committee of
seven (7) T>»rsons shall be axroointed by the Administrator,
three (3) of whom shall be chosen from the Cotton Garment
Industry, with the advice of' the chairman of its Code Auth-
ority, and three (?) of "'ho .1 shall be chosen from the hen's
Clothing Industry, with the advice of the chairman of its
Code authority, and the seventh (7th) aember shall be chair-
man of the said committee. The com.iittee is hereby ; uth-
orized to administer and supervise enforcement in respect
of cotton to sh suits ; n ; /or single prnts. The said com-
mittee, any, on its own initiative, or unon reference by
either Code Authority concerned, recommend to the Administra-
tor, changes in maximum hours or differentials or changes
in the mini nun wage to be p; i -1 e..icloyees engaged in the
production of single writs pnd/or cotton wash suits, and
issue interpretations of this order with rescect to such gar-
ments. All ouestions "rising from 1 the operation of this
Order shall be referr* to the Inter-Code Committee for
determination. Interpretations or determinations ma.de by
the s? id committee she'll be subject to an armeal to the
Administrator.
''On or before -June 30, 1934, the Inter-Code Committee
shall report to the t'-o Code Authorities concerned, r.n(t
to the Administrator, as to whether these provisions
should be changed or modified by the Administrator.
"Tlie Administrator shall arrange with the t ; -'o Code Au-
thorities for an eoui.table basis of contribution to cover
the necessary expenditures for administration by the Inter-
Code Committee. "(*)
(*) Executive Order approving Amendment ho. °. to hen's Clothing Code
and Amendment So.- 1 to the Cotton Garment Code, drted December l°>,
193". Page "■ of printed copy of amendments.
9782
CHaF TER IV
THE INTER-CODE COMITTEE
1. Appointment of the Committee.
Fursuant to the conditions of the Amendment, December 18, 1933, re-
vising the Cotton Garment and Men's Clothing Codes, the Inter-Code Com-
mittee was officially appointed thiough the issuance of Order No. 118-10
and 15-5, dated January 5, 1S34.
In order to make it possible for the Committee to begin functioning
at once, temporary appointments' were made vrith Mr. G-itchell as Government
representative and chairman. This Committee included seven members, three
of whom wore selected from the Cotton Garment Industry, three from the
Men' s Clothing Industry, and the seventh a Government representative who
was made Chairman, and met first on January 5, 1934.
The following temporary appointments were made:
Oscar Berman, of the Crown Overall Company,
Cincinnati, Ohio
Representing the Cotton Garment Industry
Ralph Hunter, of Kail, Eartwell & Company,
Troy, New ir -,rk
Representing the Cotton Garment. Industry
Victor Rafkin, of Rafkin Brothers,
New York, N. Y.
Representing the Men's Clothing Industry
Elmer Ward, of Goodall Company,
New York, N. Y.
Representing the Men's Clothing Industry
I. Welrich, of the New York Knee Fants Company, .
New York, N. Y.
Representing the Men's Clothing Industry.
B. H. Gitcnoll, Deputy alministrntor ,
to act as Cnairman
Lester Rosenbaum, of the Kalamazoo rants Company,
Kalamazoo, Michigan
Representing the Cotton Garment Industry
Because of the necessity for a sub-committee and the need of further
representation of the manufacturers of wash suits, there were certain
changes in the Con-mi ttee, and this new Committee begem to function as
early as January 18, l.)34. On February 5, 1934, entire new personnel
was officially appointed on 'the Inter-Code Committee, with Mr. Godfrey
Bloch as Chairman to succeed Mr. Gitchell. The following men were appoin-
ted on this new Committee:
9782
-361-
J. 0. Fly, of the Fly Manufacturing Company,
Shelbyville, Tennessee,
representing the Cotton Garment Industry,
to succeed Lester Rosenbaum
S. C. Van Winkle, of Sweet-Orr & Company,
New York City,
representing the Cotton Garment Industry,
to succeed Oscar Berman
R. Smith Payne,
representing the Cotton Garment Industry,
to succeed Ralph Hunter
Morris Green berg,
representing the Men's Clothing Industry,
to succeed Victor Rafkin
Godfrey Bloch, as Chairman,
to succeed B. H. Gitchell
II. Recommendations of the Committee.
The findings of these committees are briefly stated in the following
two documents:
"Memorandum "January 18, 1934.
"After the adjournment of the Inter-Code Committee on
Pants and Men's Wash Suits, it was thought best to call
a special smaller Committee to handle the Men's Wash Suits.
The reason for this being that there was only one of the
Committee who was vitally interested in the question of
Wash Suits, namely, Mr. Ward of the Men's Clothing Code
Authority. Therefore, the Chairman of the Cotton Garment
Code Authority was requested to have one or two men from
the Men's Wash Suit and Work Suit Industry to meet with
Mr. Ward in the Administrator's office on January 15, 1934.
"Mr. Rosenblcom of Baltimore, and Mr. Urban of Terre Haute,
Indiana, met with Assistant Deputy Administrator Fayne and
Mr. Ward for the meeting.
"In the interim between January 5 and 15, our experience
in the Administrator's office had taught us that a smaller
committee might be able to function better as an Inter-Code
Committee on Pants so a thought was advanced that a Committee
of Mr. Godfrey Bloch, Mr. Greenberg and Mr. Payne might be
able to work faster in bringing the matter to a conclusion.
However, the technique of substituting this Committee was
so ramified that it was thought best to request the Cotton
Garment Code Authority and the Men's Clotning Code Authority
to reduce their representation by one man and substituting
Mr. Greenberg on the Men's Clothing Code Authority and Mr.
9782
-3S2--
Payne on the Cotton Garment Codo Authority to assist
Mr. Wooirich and Mr. Ward and Mr. Van Winkle and Mr.
Fly who had replaced Mr. Rosenbaum and Mr. Berman on
the original Committee.
"Mr. Bloch took the chair in ylace of Mr. Gitchell
and will act as Chairman.
"To date the Committee as above outlined has, called a
meeting for Monday- January 22, 1934, at 2 p.m. in
room 1370, 14^0 Bioadway, New York City.
"Mr. Bloch and Mr. Oreenberg and Mr. -Payne will, in
the meantime, gather all data pertaining to the question
involved and present their findings at this meeting in
hopes that a satisfactory conclusion mr.y be reached.
R. S. Payne" (*)
A . Report of Meetings and Votes on ? ibric Classification
"This report is to cover inter-Code questions with respect to pants
as related to the Code of the Cotton Garment Industry and the Men'.s
Clothing Code.
"Under Executive Order a"P7 roved December 18, 1933, the Inter-Code
Committee was established 'to administer and supervise enforcement in
respect of cotton wash suits and/or single pants'. Under the Order 'all
questions arising from the operation cf the Order shall be referred to
the ■ Inter-Code Committee for determination'.
"Under its duties the Committee convened January 5, 1934, to classify
pants under the Order.
"The Administrator's letter transmitting the above order refers to
the conclusion cf the Administrator in part as follows:
' 1. Work pants as included in Sub-division 1;
Paragraph A, of Article II, covers a field
of merchandise not ir competition. with the
Men's Clothing Industry, and can te... defined
for the purposes of administration.
'2. There are linen of one hundred per cent (100%)
cotton trousers manufactured in work clothing
factories which are used in substantial quantities
for sport and dress occasions and do constitute an
important fpctor of competition with trousers now
made as a part of the ken's Clothing Industry.
Manufacturers shoi^ld be allowed to continue raanu-
facture under both Codes, with an increased mini-
mum in the Cotton Garment Code which will, in effect,
operate to reduce the difference in minima between
the tv.o Codes. '
(*) Memorandum re Inter-Code Committee on Pants and Men's Wash Suits,
1/15/34 meeting, signed by R. S. Payne, dated January 18, 1934. (Cotton
Garment Code Piles.)
9782
-363-
"It was held to "be the function of the Committee to classify single
pants as far as .passible between 'work pants, not in competition with
the Men's Clothing Industry' and 'cotton trousers used in substantial
quantities for sport and dress occasions which do constitute an import-
ant factor of competition with trousers made as part of the Men's Cloth-
ing Industry' , in order that a condition approaching as far as possible
to fair competition be established.
"The problem of classifying was approached primarily from the
standpoint of fabric and the vote taken on January 5, 1934, is recorded
herewith*
"On January 22, 23, 24, 1934 a committee consisting of the follow-
ing newly appointed personnel met: Mr. Hafkin, Mr. Wolrich, Mr. Ward,
Mr. Van Winkle, Mr. Fly, Mr. Fayne, Mr. Bloch, and balloted at inter-
vals on each of three days. The conclusions of that Committee with
respect to classification are set forth as follows:
"Fants made under the Cotton Garment Code work clothing provisions
shall be confined to cloths made entirely from carded all cotton yarns
without silk, rayon or mercerized yarn decorations. All cloths classi-
fied as eligible are so classified with the above limitation.
"The following were unanimously voted as eligible for classification
a s work clothing for 30-32^- cents rate both at the final meeting and
previously:
Denims, plain or printed or woven (including those known as
Hickory or express stripes)
Moleskins
Fin checks
Carded Seersuckers
Coverts
Cottonades, but excluding goods known in the trade as
cotton worsted
Fiece-Dyed Twills, Drills and Ducks (excepting bleached whites)
Corduroys, drab, seal and navy blue.
"At the final meeting it was voted that the following be made only
at the rate of 34 cents in the South, and 37 cents per hour in the North.
Bleached goods with colored yarn, woven stripe, vote five to one; goods
bleached and printed, vote four to two.
"The vote was evenly divided three to three on the following items
but unanimous consent was given that the chairman could cast his deciding
vote subsequently and so announce at the conclusion of the Committee.
Bleached white drills, twills, ducks, and Carded Cotton Whipcord
Corduroys, other than drabs, seal, brown and navy blue.
"Inasmuch as the Committee of January 5, unanimously voted that all
of the other snades of corduroy should be put in the 34-37 cents per
hour category, the chairman's vote is cast to reaffirm what previously
had been agreed upon.
9782
-364-
11 With respect to the other two items, the chairman's vote is cast
to put these goods in the 30-32i- cents per hour class.
"Ho other clothes' were requested by any other committeemen to be
classed in the 30-32^ cents category it being understood that all cloths
not mentioned were to be put in the 34-37 cents category." (*)
III The Men's Wash Suit Froblem.
A. Protest of New Orleans Firms .
While the Inter-Code Coinittee devoted practically all of their
efforts to the pants problem, this wash suit altercation was handled by
the Administration in a different way. Immediately after the publication
of the Executive Order of December 18, 1933, the New Orleans group, the
Men's Wash Suit Manufacturers Association, sent to General Johnson, under
date of December 27, 1933, a letter of protest and request for a stay of
this Order, the principal arguments of which were as follows:
^Protest of Men's Wash Suit Manufacturers National
Association against Executive Order of December 18,
1933, and Request for a Stay of its Application.
Members— Haspel Brothers, Inc. )
Godchaux Clothing Co , )
Famous-Sternberg Co. ) New Orleans, La.
Hirsch & Baar )
A. Solomon )
"This Association manufacturers the great bulk of men's
cotton wash suits produced in this country, and protests
against this Order transferring the manufacture of men's
cotton wash suits, when made by clothing manufacturers,
to the Men's Clothing Code.
"It compels them to pay minimum wages of 85^ per hour
for cutters and SOrf for of f-pressers, as against a mini-
mum wage of 34rf, without distinction as to the classes
of labor for manufacturers of cotton wash suits when
made in work clothing factories — same services must be
performed — and same class of labor used. These manufactu-
rers will pay 51(# per hour minimum, more for cutters, and
26^ more for off-pressers than their direct competitors
manufacturing an identical garment under the Cotton Gar-
ment Code. Cotton Garment Code has 40 hour week, vs. 36
hour; 30<# per hour minimum vs. $13.00 per week; learners
vs. no learners allowed; 10$ inefficients with no minimum
vs. 5$ inefficients with 70$ minimum.
(*) Memorandum dated January 30, 1934, to Byres H. Gitchell, Deputy
Administrator, from Godfrey Bloch, Special Administrator.
(Cotton Garment Code files.)
9782
-365-
This distinction is based, not on the article itself nor
conditions and methods surrounding its manufacture, but
on the fact that something else is manufactured under the
same roof, and these manufacturers are discriminated
against because they make the manufacture of these gar-
ments their principal rather than their partial activity.
Claims that the New Orleans group never agreed to (letter of
transmittal mentions agreement between New Orleans manufactu-
rers and Men's Clothing Code Authority) any such distinction
as is made in this Order. Asks for an immediate stay. (*)
Then, 1 on January 11, 1934, in the following letter, this Asso-
ciation requested another hearing on this question:
"Hon. Hugh S. Johnson
N.R.A. Administrator
Washington, D. C.
' "Dear Sir:
" Request for hearing by Men s Wash Suit Manufacturers
National Association under terms of the Executive Orde r
of July 15, 1935 .
"On benalf of the above Association we respectfully re-
quest a hearing on the Executive Order of December 18,
1933, transferring manufacturers of men's cotton wash
suits not engaged in the manufacture of work clothing
tc the fen's Clothing Code, and leaving manufacturers
of such clothing who also manufacture work clothing
subject to the Cotton Garment Code.
"It is respectfully submitted that this Association nor
its representatives neither participated in the establish-
ment of -or consented to the Executive Order involved.
"The record clearly shows that the Executive Order pro-
posed upon which notice was given and hearings held on
November 27, 1933, contemplated the transfer of all
manufacturers of cotton wash suits to the jurisdiction
of the Men's Clothing Code (?.. Page 2, 3, 6, 9, 44, 53,
and 54). No notice was given then nor thereafter prior
to the actual signing of the Executive Order of December
18, 1933, of any proposal to divide the manufacturers
of cotton wash suits into two groups with different
standards set up for the manufacture of identical gar-
ments manufactured by the same methods and in direct
competition with each other. Of such competition, General
Johnson in his report on the Cotton Garment Code (Page VII)
makes the following observation.
(*) Letter dated December 27, 1933, from Men's Wash Suit Manufacturers
National Association to General Johnson.
9782
-366-
11 'Manifestly also* employers could not "be expected to
continue under the Men's Clothing Code, if other employers
in direct competition and producing the -same articles
were permitted to operate under a code which was more fav-
orable to them. That would he unfair competition of a most
vicious character.'
"If the competition there referred to "by General Johnson
may be characterized as 'vicious 1 , 'what may not with pro-
priety be said with reference to the unfair competition
created by this Executive Order?
"We attach herewith as a Part of this request for a hear-
ing, copy of our protest filed with you under date of
December 27, 1933, which sets forth in detail the discrim-
inatory conditions created by the Executive Order involved.
"The extent of the unfair competition ,-, hich our manufacturers
would be compelled to face from manufacturers of cotton wash
suits under the Cotton Garment Code is indicated by the state-
ment of Mr. Hunter of the I.A.u.M. (R.Page 14) wherein he
estimates that mr-nuf acturers of work clothing produce at least
$1,000,000 worth of cotton wash suits in the last year. The
garments chiefly invovled ara seersucker suits and they are
so identical that it is impossible for even the trained eye
to determine whether or not a particular garment has been
manufactured in a work clothing shop or a shop engaged ex-
clusively in the manufacture of men's wash suits. Naturally,,
all such suits corns in direct competition with each other.
If granted a hearing we offer to prove that the Executive
Order of December 18, 1933, is grossly unjust and prejudicial ,
to the manufacturers composing this Association in requiring
of them higher standards in the manufacture of an identical
garment than is provided for their direct competitors in the
Cotton Garment Code. We have been advised that unless our
manufacturers can be relieved from- this situation it will be
necessary for them to shut down their plants, thus causing
large losses of invested capital and unemployment to approxi-
mately 2,000 employees.
"Very respectfully yours,
(signed) "J. Bruce Kremer
"Guilford S. Jameson
"Attorneys for Men's Wash Suit Mfrs. Nat'l Ass'n
"Kaspel Brothers, Inc.
"Godchaux Clothing Co.
"Famous-Sternberg Co.
"Hirsch 8c Baar
"A. Solomon"
(*) Letter dated January 11, 1934, from Men's Wash Suit Manufacturers
National Association to Gen. Hugh S. Johnson. (Cotton Garment Files,
under Code Amendment ifl.)
9782
-367-
3. Investigation by Deputy Administrator Morris Greenbcr- .
As • result of numerous conferences ana negotiations between
the Atiuinistration, the Lien's Clothing Code Authority, and the peti-
tioners immediately subsequent to the receipt of these letter-,, it v;as
i.ecided that an investigation of these plants and their particular
ble.ns was desirable, and Special Deputy Administrator Morris Green-
ber was sent to Few Orleans for that purpose. After nearly a reek,
uty Greenuerg arraj ed a satisfactory solution, and the following
ent was drawn up on January 23, 1934, and signed by this her
Orl. ,>:.
"Roosevelt Hotel,
i i w Orleans, La.
"Dear Major Gitchell:
"I am enclosing two (3) signee copies of the Agreement I
finrlly reached here, to ;ct i r with , a signed copy of a.
covering letter.
"As you rill see, these papers definitely bind these parties
as soon as you anc the Code Authority sign the Agreement.
'•ill you please arrange to have one- of these copies signed
,^y yourself and Mr. 3cil, and return it to Mr. Edward Has-
t L, 912 Union Bldg. , Few Orleans.
"Before I finrlly agreed to the 30p* and the form of this
Agreement, and the method of signing etc. - I took the
liberty of phoning Mr. Drechsler, and this has his approval.
"This was finrlly completed at about 11:30 tonight — too
late to catch the 10: IE train to Dallas, so I go 7 oy plane to-
morrow and will be in Dallas by Tuesday P.M.
"I ho v this solution of th ITow Orleans situation meets
with your approval. I think it is fair and meets the
si tuation.
"With kindest personal regards,
"Morris Greenberg"(*)
C. ATree-.c-rcs with hev: Orleans Firms.
(*) Letter undatci , in Men's Clot] In Code Files, under Employ-
ment, Wages and hour Exemptions) ' aux Clothing, Haspel
Brothers, Sternberg, Etc.
>732
-368-
m-_t CV7 Orleans, Louisiana
January 22, 1934.
"The Code Authority,
Lien's Clothing Industry,
Pew York City.
"Gentlemen:
"V.'c arc enclosing herewith the tentative agreement entered
into between Mr. Morris Greenberg, Assistant to the Deputy
Administrator, and ourselves in reference to interpretations
and exceptions to the Men's Clothing Code as applicable to
ourselves,
"V/'c agree to the terms hereof, and they shall be in full
ti'i cct and binding upon us when and as soon as they have
''occn approved by you and the Deputy Administrator, Mr.
Gitchcll, and we have received notification thereof.
"Yours very truly,
GODCIIAUX CLOTHING COPPANY, LTD.
B y (Si .ricd) LLON GODCHAUX, PELS.
IIASPLLBi.OTlL.HS, INC.
B y (Sp-ned) JOS. HASPLL, PPBSIDLPT
FAi.ru S-STLHB13LHG, IPC.
B y (Si-ncd) JLS PL, S. POSF/PFELD, TLZAS .
ETIBSCH & BAKR '
P y (Signed) PAUL IIIPSCH
(Signed) A. SOLOMON "(*)
"•• LP.SAS the parties hereinafter named have filed a
protest against the placing of wash suits of one hundred
(lOGp) per cent cotton content in the Men' s Clothing Code
and have otherwise protested against the inclusion of any
wash suits in the Men's Clothing Code, and
"'v/HLHEAS it now appears that there is a solution of the
problem that will io substantial justice to all parties
without working hardship or discrimination against any,
"POY; THEREFORE the undersigned:
LLOP GODCHAUX CLOTHING COMPANY, LTD. ,
PA3PEL BROTHERS, IPC. ,
FAMOUS- STERNBERG, IPC. ,
IIIPSCH d BARE, p partnership, and
A. SOLOMON,
(*) Letter dated January 22, 1934, in Pen's Clothing Code Files, under
Employment, '.ir es and Hour Exemptions, Godchaux Clothing, Haspel Bros.,
Sternberg, Ptc,
S78J
-369-
all of Hew Orleans, Louisiana, and hereinafter designated
. lUfacturers, and 3yres H. G-itcholl, representing th
dnistratpr of the National Recovery Administration, and
George Bell, representing the Code Authority for the Men's
Clothing Industr; , -\ agreed and do hereby agree to the
follovin ■ int t< Lions and exceptions to the Men's Clo-
thing Code and > in rid i< its and regulations in connection
rewith as applying to the said Manufacturers hereinabove
led.-, to-wit:
"(a) . During the re ular operating season the s-^ic 1 manu-
cturers will be permitted to opera.te four (*-) hours over-
timi .■ . k at normal rates.
"(b) All ",7agcs, ar set forth in the Men's Clothing Code
ts tl.tr_.tc, shall be maintained.
"(c) Clause II (b) is held not to apply to said manu-
f ct re rs.
"(d) Each manufacturer is allpwcd to employ sub-standard
help rs provided under Article II, Section G, of the Lien's
Clot: ;ing Code, as amended, up to thirty (30^) per cent' of
its employees, including sub- standard cutters and pros-
scr _.
"(b) Each of said manufacturers shall file its list of sub-
r< ..../: oyee.s with the Code Authority, or the proper
subdivision- thereof , ant it shall be revised semi-monthly
~oy the withdrawal of some names and the inclusion of others.
"(f) In view of the confusion that might result from the
loyment of certain employees a portion of the time on
linin and at other .times on cotton, and in order to pro-
vide for s uniform minimum for ail employees, each manu-
facturer shall arrive at a proportional intermediate mini-
mum :>n the basis' of the proportion of cotton versus linen
actually manufactured according to its records fur the
i vious year, which said minimum so determined shall be
b aimed until ruch time as the said manufacturer is
able to determine accurately that the proportion existing
for t - • rvious year "/ill n«.t be applicable to the
ar, at which tine the said minimum shall be ad-
--d in rccorwi-c. with the information so obtained.
In : i ting - 11 payrolls to the Code Authority special
mention shall be mace of the intermediate minimum used.
"This: agreement shall be \indin;? and effective immediately
upon the signing hereof . , L] artioc, ant ; ' certificate
of compliance will be signed ane til .. ane Labels as pro-
vided by Article V of the Hen's Clot: i ■ ' will be furn-
b?82
-370-
ished to said Manufacturers for all merchandise thereto-
fore manufactured and presently held in stock by said
manufacturers.
"LEON GODCHAUX CLOTHING COMPANY, LTD.
By (Signed) Leon Godchaux, Jr., Pres .
"HASFEL BROTHERS, INC. -
By (Signed) Jos. Haspel, Pres.
"FAMOUS-STERNBEPG, INC.
By (Signed) Jesse S. P.osenfeld, Trea s .
11 HI PS CH & BAPR
By (Signed) Paul Hirsch
A. Solomon
(Signed) A. SOLOMON
M. GREENBEPG"
Apparently the "en's Clothing Code Authority never actually signed
a copy of this agreement, hut in the following letter dated February
3, 1934, from Executive Director George L. Bell to Leon Godchaux, they
did confirm all articles of said agreement, except the one respecting
overtime.
On February 2, 1934, Deputy Administrator Gitchell wrote the
following letter to Mr, Edward Haspel, advising him to reouest this
overtime frcm the Administration:
"This will confirm our conversation today in conference
between yourself, Mr. Leon Godchaux, Mr, George Bell,
Mr. Morris Greenberg, and the writer in respect to over-
time for the New Orleans manufacturers whom vou represent,
"If you will submit an application in proper form, and
the same meets with the approval of Mr. Bell as Director
for the Men's Clothing Code Authority, I '"ill be very
glad to recommend an administrative order be issued
by the National Recovery Administration allowing
overtime four (4) hours per week at regular rates
of compensation. This assurance based upon investi-
gation made by Mr. Morris Greenberg on the ground.
"This Administrative Order vou unoerstand, requires
approval as to form and content by the Legal Divi-
sion and Advisory Boards. I know of no reason why
we snould expect a refusal by the administration to
act favorablv on this recommendation." (*)
(*) Letter dated February 2, 1934, from Byres Gitchell to Edward Haspel.
(Men's Clothing Code Files, under Employment, l.ages and Hours
Exemptions, Godchaux Clothing Co., Haspel Bros., Etc,)
9782
-371-
The letter iron George L. Jell, Executive Director, Lien's
Clothin; Code Authority, to Leon GodchauX, mentioned above, is
as follows:
"Mr. Morris Grc* nber ■;, an assistant to B. H. Gitchell,
I by Administrator of the 1J.R.A. , was sent to New
Orleans to make an investigation in behalf of our Code
A thority and Mr. Gitchell, of the shops of
Leon Got chaux Clothing Company, Ltd.
Kaspcl Brothers, Inc.
?;..im-.s- S t ernb er % , I nc.
Hirsch & Barr, a partnership, anei
A. Solomon
"Mr. Greene, r: has made a brief written report, and on
his return from Hew Orleans made a lengthy oral report
of his findings.
"Based on Mr. Greenberg' s findings, and his recommenda-
tions, the Code Authority has determined that in.- all
the different shops the provisions of Article. II, para-
graph (b) have ban substantially complied with. This
will serve as confirmation of my oral statement to you,
that tliis action has been taken in accordance -with the,
)rovisibn contained in Article II, paragraph (cl).
"Mr. Greenbcr : also made an investigation in connection
with your application to employ in excess of five per
cent (5p) of excepted persons, under the i^rovisions of
Amendment fl to the Code of Fair Competition for the
Men 1 a Clothing Industry, as set forth, in clause ( d) of
seid. Amendment, adding a new paragraph (g) to Article
II of said Code. The Code Authority, acting upon the
findings and recommendations of Mr. Greenberg, has
ruled that the above shops shall be allowed to employ
such excepted persons to a number not to exceed; thirty
per cent (3C .) of the total number of employees in each
of the respective shops or plants named above.
"Also acting upon Mr. Greenberg 1 s findings and recom-
mendations, the Code Authority has determined that your
proposed method of fixing the minimum rates of pay for
Losses who are working a portion of their time on
lir , i ' Dther times on cotton, is fair and equitable,
ate from the statement signed by the various firms
the following section of this method:
iit**j_ n prefer to provide for a uniform mini-
mum for all employees, each manufacturer shall
arrive at a proportional intermediate mini-
' mum "on the- -basis of the" proportion of cotton
V' reus linen actually maiiufact) rcrd • ccording.
to its records for t te revicus year, which
1782
-372-
said minimum so determined shall be main-
tained until such time as the said manu-
facturer is able to determine accurately
that the proportion existing for the previous
year will not be applicable to the current
year, at which tine the said minimum shall
be adjusted in accordance with the -infor-
mation so obtained. In - submitting all pry-
rolls to the Code Authority special men-
tion shall be made of the intermediate mini-
mum used. '
"171 th respect to your petition for permission to operate
an extra four hours overtime per -week, this cannot be acted
upon hy our Code Authority, as no provision is made in the
Code giving the Code Authority such powers. Any relief on
this matter must be secured by an administrative order
from the IT.R.A.
"Of course, it is our understanding that all the firms named
above intend to sign certificates of compliance and observe
all requirements of the Oode of Pair Competition . for the
Men's Clothing Industry. Upon signing such certificates.
of compliance, all firms will be entitled to labels as pro-
vided in Article V of the Code, and we understand that all
garments heretofore manufactured and presently held in
stock by the above firms will be labeled, as well as
garments manufactured in the future. "( *)
On February 3, 1934, Mr. Bell wrote the following letter to
Deputy Administrator Gitchell, giving the Code Authority's approval
t# this requested overtime, if the H.R.A. saw fit to allow it:
"Confirming our conversation yesterday, I wish to state that
the Code Authority has determined that it has -no power to
grant to the petitioned Men's Clothing Manufacturers of
Hew Orleans, Louisiana, the j^rivilege of working any extra
number of hours per week. The powers granted to our Code
Authority under Article IV of our Code to give such permis-
sion is limited to 'Tailoring to the Trade and 'manufacturers
of uniforms. ' 'I understand that you. concur with our inter-
pretation on this point.
"Accordingly, ony relief granted the petitioners must come
as a result of the Administrative Order from the 1T.R.A. We
have no objection to your granting permission to operate
overtime during a reasonable period, but would strongly
urge that the amount of such overtime should not exceed
four hours per week, "(**)
(*) Letter dated February 3,1934, from George L. Bell, Exec. Director,
li.CC. A., to Leon Godchaux. (Men's Clothing Code files, under Employ-
ment, WaSes.and Hours Exemptions, Godchaux Clothing Co. ,Haspel Bros. Etc.)
(**)Lotter dated February 3, 1934, from George L. Bell, Exec. Director,"
M.C.C.A. , to 3yres H, Gitchell, Deputy Administrator, (Men' s Clothing
Code files, under Employment, Wages and Hours Exempt ions, Godchaux
Clothing, Etc. )
9782
-373-
Undcr date of February 2, 1934, Mr. Edward Haspel, as attorney
for n Orleans firms, filed the following petition requesting
their four (4) hours weekly overtime:
"The under,- led, i s attorney for Loon C-odchaux Clothing
Company, Limited, Haspel Brothers, Incorporated, Famous -
Sternberg, Incorporated, Kirsch and Baar, a partnership,
'-. S 1 ion, hereby submits an application for an al-
lowance of overtime of four (4) hours per week at regular
rates of compensation during the regular operating season
for :' .. following reasons," to wit:
"1. Should the above named manufacturers operate under
the Men's Clothing Code, they villi be in competition with
manufacturers of cotton wash suits operating under the
Ootton Garment Code providing for r maximum of forty (4C)
urs per
"2. Prior to the enactment of the N. I.R. A. , s^id manu-
facturers were accustomed to operate an average of more
than fifty- eight ( C3) hours per week, and in ord^r to
intain production is line with prior years at thirty-
six (36) hours will have to increp.se the number of ; emplc~.
s :o a point where, because of a scarcity of labor in
this particular market, it will be impossible for them
to obtain sufficient help.
"3. "here is no unemployment in the industry and no
iket from" which the above r.-med. manufacturers can draw
additional help, and the amount of work they presently
have on hand will Justify your granting then the relief
requested.
"In our conference toda.y these, matters were all discussed
with you, Mr. George Bell, Mr. Morris Greonberg, and Mr.
Leon Godchaua, when we went into some detail in connection
with the points hereinabove set forth.
"I therefore respectfully urge that you recommend an
inistrative order granting to the above nrmed manu-
facturers the right to operrte fon.r (4) hours per week
overtime at regular rates of compensation. "( *)
D. Drce r "To. 15-8--Hours Exemption to these Mmuf aeturcrs .
Therefore, on February 23, 1934, the following Administrative
Order (ho. 15-8) granting this overtim< , wa.s duly approved ^nd signed:
(*) Letter dated February 2, 1334, to Zy?<-3 11. Gitchell, Deputy Ad-
ministrator, from Edward Haspel, Attorney. (M n's Clothing Code Files,
under Employment, Hours and Wages Exempti >ns, Godchrux Clothing Co.,
Haspel Brothers, Itc. )
9782
-374-
"Excmption from Article IV of the Code of Fair Competition
for the Hen's Clothing Industry.
Order No. 15
"The Code Authority for the Men's Clothing Industry
having recommended that
Leon G-odchaux Clothing Company. Ltd.
Easpel Brothers, Inc.
I imous- Sternberg, Inc.
Hirsch & Barr, p. partnership, raid
A. Solonion,
all of New Orleans, Louisiana, be allowed four (4) hours
per week over the weekly limitations set forth in Article
IV of the Code of Fair Competition for the lien's Clothing
Industry, at normal rates of pay, and good and sufficient
cause having been shown therefor, and approval of said
recommendation of the Code Authority having been given by
the Deputy:
"Now, therefore, approval is hereby given of the recom-
mendation of the Code Authority, and said exemption is
hereby granted.
"A. D. Whiteside,
Division Administrator.
"February 23, 1954.
"Approval recommended:
B. II. Gitchell,
Deputy Administrator. "(*)
(*) Ore or No. 15-8, Men's Clothing Code Files.
9732
-375-
CHAPT2P V
AMENDMENT 110. 3 TO COTTON GAUMENT CODE..MAHCH 15, 1934
I. Changes in tiie Code as approved March 15, 1934.
The Executive Order of December 18, 1933, failed to improve to any
real extent the "age and hour competitive situation on the single pants
and wash suits, vifhile some companies revised their rates to the specified
34 cents per hour in the South, and 57 cents per hour in the Worth, many
of the cotton garment manufacturers failed to make any attempt to comply,
and continued to produce these garments at the old 30 cents and 32-- cents
rates. The Industry as a "hole was very much dissatisfied with the Decem-
ber 18th amendment, and the Cotton Garment Code Authority made only a half-
hearted gesture to enforce compliance.
A. De'out' r Ac'Turistr-'toi" Gitcaell' s Letter of Tr: nsnittal .
In order to speedily improve existing conditions, if possible, and
r study and consideration of the I nter-C ode' Commit+u:' s investigations
nnd recommendations, on February 25, 1934, Deputy Administrator Gitchell
wrote the following letter of transmittal to General Johnson:
"This report is to cover inter-Code Questions rith respect to
pants as related to the Code of the Cotton Garment Industry and
the].; en's Clothing Code.
"Under the Executive Order approved December 1G, 1933, the
Inter-Code Committee was established 'to administer and super-
vise enforcement in respect of cotton trash suits and/or single
pants.' Under the Order 'all questions arising from the opera-
tion of the order shall be referred to the Inter-Code Committee
for determination.
"Und.er its duties the Committee convened. Januarv 5, 1934, to
classify pants under the Order.
"The Administrator's letter transmitting the above order refers
to the conclusion of the Administrator in 'Dart as follows!
"'I. TTork Pants as included, in Subdivision 1, Paragraph A, of
Article II, covers a field of merchandise not in competition
' ith t l ide; 's Clothing Industry, and can be defined for the
purposes of administration.
"*2. There are lines of one hundred ver cent ( 100.1) cotton
trousers manufactured in work clothing factories, which are
used in substantial Quantities for sport and d.ress occasions
and do constitute an important factor of coi petition with
trousers nov made as a >art of the ...'en'- Clot d i Industry.
nufacturers should be allowed bo con-tin '• cture under
both Codes, with an increase:" iiinimuir in the Cotton Garment
Code which will, in effect, o _ oer< te to reduce the difference
9782
-376-
"It was held to be the function of the Comnittee to classify
single pants as far as possible between 'work pants, not in
competition with the Len's Clothing Industry' and 'cotton
trousers used in substantial Quantities for sport and dress
occasions which do constitute an imoort.-nt factor of compe-
tition v/ith trousers made as mart of the i.ien' s Clothing In-
dustry, * in orcer that a condition ao-oroa.ching as far as
possible to fair competition be established.
"The 'iroblem of classifying '"as approached from the stand-
point of faoric and the vote taken on January 5, 1934, is
recorded herewith.
"On Jrnuary 22, 23, 24, 1934, a committee consisting of the
following newly a-nointed personnel met: i.ir. Rafkin, Mr.
" 7 olrich, i.'r. ~Tarc! , L~r. VanT/lnkle, L'r. Ill', i- 1 "- Payne, Mr.
Block, and balloted at intervals on each of the three daj^s.
The conclusions of that Comnittee with respect to classifi-
es bion are set forth a.s follows:
"Pants made under the Cotton Garment Code pork clothing
provisions shell be confinec to cloths made entirely from
carded all cotton yarns "'ithout silk, rayon or mercerized
j^arn decorations and containing no wool fiber. All. cloths
classified as eligible are so classified '"-ith the above
limitrtion.
"The following "ere unanimourly voted as eligible for
classif icrtion wa work clothing for 30 - 32-;(* rate both
at the final meeting and "oreviously:
"Denims, plain or printed or -oven (including those denims
known as Hickory or express stri;oes) ,
Moleskins,
Pin Checks,
Carded Seersuckers,
Coverts,
Cottonodes, but excluding goods known in the trade as
cotton worsteds,
Piece-Dye<?' Twills, Drills end Ducks ( e.pce'oting bleached
white--) ,
Corduroys, dark drab, seal bro v n and navy blue.
"At the final meeting it -as voted that the following be
made only at the rate of 34rf -oar hour in the South, rnd 37r*
per hour in the Forth. 31eached goods with colored yarn
woven stripe, vote five to one; goods bleached and printed,
vote four to one.
"The vote was evenl}?- divided three to three on the follow-
ing items but unanimous consent wa^ given that the chair-
man could cast his deciding vote subseauently and so an-
nounce a.s the conclusion of tae Committee.
9782
-377-
" Corduroys, other than dark drcb, seal brown & navy blue,
31eached white drills, trills, dunks, anc
Carded Cotton T7hip,eord.
"Inasmuch as the Co mittee of Jan-oar 7 - 5 unanimously voted
that rll of th - ..• is of corduroy other then car!: drab,
seal bro' n and ns • blue i iould oe put in the 34 - 37j# per
hour category, the chairman's vote i<= cast to reaffirm what
previousl3' hrd been agreed upor. .
"TTitn respect to the latter t 1 o items, the chairman's vote
is cast to -rat these goods in the 30 - 32\d per hour class.
"ITo other cloths were reouested oj any other committeeman
to be classed in the 30 - 32 ■/■ category, it being under-
stood that all cloths not mentioned rere to be put in the
34 - : "V' category.
"The -proposed administrative order submitted herewith is
drafted to a;ive effect go the conclusions of the Committee.
O
•Chile the inter— Code -problem involved is very similar to
thj t between the Cotton Garment and Dress Industries, the
procedure followed differed, inasmuch as an Inter-Code
Committee handled this problem, whereas a Special Adminis-
trj tor handled the other.
"A" 1 thoujh the inter-Code cress problem was substantially
solved in some three weeks, the Inter-Code Committee on
ts and vash suits did not even convene until about
three weeks after the order, end then only with temporary
appointees. The necessit T ' of committeemen arranging their
schedules to travel rreat distances has made the procedure
cumbersome. Furthermore, the Cotton Garment Code Authority
at the last co- mittee meeting specifically reauested
a more specific order and more workable procedure. Accord-
ingly, it is recommended that the Inter-Code Committee's
functions be turned over to a. Special Administrator. The
proposed order is drafted to effect this change also and is
recommended for 3'our approval." (*)
3. Dif -"--rent TTr^e Rates for Different Fabrics Arroroved -
On ;' rch 15, 1934, the following amendment to the Cotton Garment
Code, Amendment No. 3, "r? officially approved.
"Schedule 'A'
"The Executive Order of "ece'iu^r 18, 1933, amending the
Code of Frir Competition for the Cotton Garment Industry,
is amended as follows: Conditions i r umh rs 1 and 2 of the
■ ■ - — — - — — — ■ -■■ ..,■■—...-■ ■ - - ....
(*) Deputy's Report to the Administrator, d; bed 7ebruary 25, 1934,
attached to Amendment I'o. 3 to Cotton Garment Code.
9782
— o co-
said Order are abrogated", and the following substituted
refor:
"1. l T o manufacturing employee engaged in the production
of men's and boys' pants when mace of (a) corduroy, other
then those shades set forth below, or (b) cloths other
than those set forth below, whether or not made in work
clothing factories, shall be paid at less than the rate of
thirty-four cents (34rf) per hour in the southern section
of the Industry, or less than thirty-seven cents (37^) per
hour in the northern section of the Industry, as such sec-
tions are defined in the Cotton Garment Code and amendments
thereto.
"Ho manufacturing employee engaged in the production of
men's and boys' pants made in work clothing factories in
conjunction with work clothing or work pants, when made of
100$ cotton content and when made entirel"' from carded
cotton yarns without synthetic yarn, silk or mercerized
yarn decoration, and when such pants are made of (3) denims,
plain or printed or woven, including those denims known
as Hickory or express stripes, or (b) moleskins, or (c) pin
checks, or (d) carded seersuckers, or (e) coverts, or (f)
plain dyed or bleached ducks, twills or drills, or (g)
cottonades, exce-ot cotton worsteds, or (h) dark drab, seal
brown or navy blue corduroys, or (i) heavy carded cotton
vrtiipcords, shall be paid less than at the rate of thirty
cents (30<0 wr hour in the southern section of the Indus-
try, or less than thirty-two and one-half cents (32V) P er
hour in the northern section of the Industry, as such
sections are defined in the Cotton Garment Code and amend-
ments thereto, "
C. S'oecir.l Administrator Succeeding; Inter-Code Committee .
"2. The Inter-Code Committee provided for in Condition
Number 2 of the Executive Order of December 18, 1933,
amending the Cotton Garment Code, is hereby terminated and
all powers and duties delegated to the Committee in said
Condition are herebjr transferred to the Special Administra-
tor hereinafter provided. It is hereby ordered that a
Soecial Administrator shall be designated to serve until
July 1, 1934, who shall administer and supervise enforce-
ment in respect of cotton wash suits of 100$ cotton content
and/or single pants, shall determine all ouestions in respect
of the appropriate minimum wage to be paid by any member of
the Industry pursuant to this Order, shall make interpre-
tations of the provisions of this Order, shall have the power
to add. to, alter, or reclassify any of the definitions or
classes of materials set forth in this Order, and shall de-
termine all ouestions arising from the operation of this
Order. His determination and findings shall be final, and
pending an appeal to the Administrator shall be binding until
disapproved.
9782
-379-
"The Special Administrator shall mc.':e n survey and study
of the Pants Industry, and shall prepare a report and
recommendations prior to Jvaie 30, 1934, with resnect to
changes in maximum hours, differentials, or chances in the
minimum wa ge to be paid employees engaged in the production
of men's and boys' pant?, and -ita repsvsct to amendments
to the Cotton Garment Coae concerning definitions, wage
rates and/or maximum hours.
"3. Po manufacturing em?lo--ee engaged in the production
i ij ■-
of men s '.vash suits of 100' cotton content when made, in
work clothing factories in conjunction with "or'c clothing
shall be paid at less than the rate of thirty-Tour cents
(34.?) per hour Then employed in the southern section of the
Industry, or less than thirty-seven cents 037 rf) per hour
when employed in the northern section o^ the Industry, as
such sections are defined in the Cotton Garment Code and
amendments thereto. The Special Administrator hereinabove
provided for shall have the same powers end duties with
respect to such cotton wash suits as .are delegated to him
by this Order with respect to men's rnd boys' parts." (*)
In accordance with condition To. 2 of the ne - ' amendment, terminating
the Inter-Code Committee and ordering the designation of a Special Ad-
ministrator to administer, supervise, end study the production of these
particular garments, Deputy Administrator Gitchell, in a letter to
leral Johnson, dated March 17, 1SZ4, recommended the appointment of
i.'r. "Godfrey 131och as such Special Administrator, and Administrative Order
l"o. 113-37, appointing Mr. 31och, was duly signed on March 28, 1934,
calling for ds report and recommendations prior to June 30, 1934.
II. effects of Amendment Po. 3 to Cotton Garment Code.
A. Fabric Classification Proved Impractical .
It soon became apparent that this further attempt to settle the
auestior. by classifications of faeries wa.s not solving the -problem in
?n - ' manner. Manufacturers found, it impossible to pay higher wages on
certain bolts of cloth than on others, ''hen both were worked on b _r the
same operators. At least, those who attempted this found it so, for, as
before, most of the plants made no effort to differentiate between
different fabrics and continued paying the lower wage scales on all gar-
ments.
All evidence produced pointed to the fact that probabl" the equali-
zation of wages in the t"o Codes was the only way in which a satisfactory
solution could be achieved..
Pumerous complaints rega.rding the new rulings were filed with the
Administration and the Code Authorities concerned., and once again no real
effort was made by the Industry to comply with the provisions of this
amendment.
(*) Amendment Pc. 3 to the Cot';on Garment Code.
9782
-380-
3 . Protect- from Southern Manufacturers .
Tlie Southern Garment Manufacturers Association's protest and reouest
for a stay, dated March 24, 1934, as shown b*- the following copies of
the correspondence on the matter, was a typical example of how many
members of the Industry felt about this latest amendment.
"A resolution, passed by the 3oard o*" Directors of the
Southern Garment i Manufacturers Association in a special
session in Atlanta, Georgia on Saturday, March 24, was
sent i'ou Wednesday, March 28, from the office of this
Association.
"This Association has at present a membership of 267 Gar-
ment Manufacturers in the South and has affiliated with the
Southwestern Garment Manufacturers Association made up of
48 members in the Southwest. Let it be understood that all
of these majiufacturers hpv? tried from the first to comply
with the "orf and spirit ox the Industrial Recovery Act.
Ye have formed ourselves into an association the orincipal
purpose of which is to promote and further industrial re-
cover-*. It is a fact that our own Code Authority located
in Few York Git"*, even though it is ma.de up almost entirely
of Northern and Eastern Manufacturers, has said that the
South is far ahead of the Forth and Bast in Code corrroliance,
and b - ' comparison has been almost free -from violation. Let
it also oe understood that ,T e are organized for out mutual
protection, . und since we are almost entire]. - * without represen-
tation on our own Code Authorit 1 *, we have perhaps given more
time and. study to the welfare of industry in our section than
any other section or group.
"The resolution which was sent to you set forth at length
the very unfair situation ''inch the Administration is seek-
ing to create and -out upon the Southern Manufacturers. This
situation has been. brought about by the ruling and decisions
of a. Committee which was entirely unrepresentative of the in-
dustry and. which v r e feel violated, the oldest principle of the
American people who stand for Government only.
"Decisions such as the one referred to can not help but break
do 1 'n and destroy our faith in the Recovery Act and the Re-
covery Administration. Regardless of the legal status and.
penalties attached, to the Recovery Law, it can not succeed
without the proper cooperation from all who are affected. De-
cisions which are unfair to any one section of any industry
can not be conducive to this necessary cooperation.
"We are writing you because so far we hrve felt v .'e are
governed by adeouate representation and because you are our
representative. You have, I am sure, the ultimate v "ell-
beinr of T *our section in mine.. Ye ask that after you have
a.couainted yourself with the facts of this case that you
9782
- 1-
tahe immediate steps to see that the situation is corrected,
and that a similar situation is not allowed to again occur.
The South nmatnot be allowed to be forced entirelv off the
industrial horirron." (*)
"'.Thereas, The Cotton Ffnrr Industry in the South, consist-
ing of 214 oants manufi : u ■ irs operating 28,423 machines,
located in 14 ■ : ' 'n states, lies been unduly discriminated
against by the rational Recovery Administration in its deci-
sion ^lacing under a prohibitiv ; ; scale the manufacture
of -cants of certain cotton frbrics, resulting in forcing the
cost of sue i ;arment beyond the uurc^asir - ~>ower of the av-
erage workin ■ nan, inasmuch as working jrcole are unable to
afford wool or semi -wool pants, thus ignoring entirely the
interest of thos^ consumers deserving the greatest considera-
tion, namely, the working man ,' nc the farmer; and
"Where; s, The said all cotton pants manufacturers represent-
ing 93-o of the industry ar -e entered into contracts to cell
the retail trsde hundreds of t tousands of dozens of these
cotton oants at tli< rage rates heretofore in effect under
the Cotton Garment Coze, thus forcing conf iscatory costs
upon the southern pants manufacturer; ant?
"Whereas, Although the southern manufacturers presented to
the Inter-Code Committee for the Cotton Garment Industry
and the Clothing Industry voluminous end uncontroverted
evidence of the inescapable fret that all cotton content
pants consisting of all cotton fabrics known as printed
anf woven twills, drills and ducks and similar fabrics T "'ere
manufactured, sold and • orn a.s cotton work pants; and
"Whereas, the Inter-Code Committee responsible for the de-
cision and controversy was not representative of the Cotton
Pants Industry as a whole, only one member thereof being a
southern pants manufacturer; and
"Whereas, There can be no justification for charging a
higher wage in, the manufacture of cotton pants than in the
production of overalls, dress shirts, work shirts, cotton
dresses, which are allowed to be made at basic rates named
in the original Cotton Garment Code, and which contain no
more cotton than do the above mentioned fabrics used in the
manufacture of cotton pants; and
""'.-'rear, The greater volume of the southern pants manu-
facturer consists of those fabrics that have now been placed
under the higher -are rates o^ 34 cents per hour, thus making
it impossible for the manufacturer to segregate his labor in
the factory in sue.: a r r~ r - ~ to pay each worker the wage rate
(*) Letter dated April 2, 1934, to Senator .Zenneth iicKellar, from T. P.
Kennedy, Jr., of O'Bryan Bros. , Inc., ITashville, Tear.. (Cotton Garment
Code Files.)
9782
-382-
called for according to the classification of the garments,
- • •" further creating a condition whereby one manufacturer
of pants "ill consider a piece of cloth under the 30-cent
rate and another manufacturer "ill consider the same -oiece
of cloth under the 34-cent rate, thus creating unbounded
confusion among the workers and the management, leading to
labor difficulties; and
'TJhereas, The Special Acini nist rat or placed in charge of
this matter, and ether Recovery Administration officials
•-ere and are unaole to Differentiate between the work
■oant consisting of the fabric, the-*- have classified as
b; king the 34-cent rate end the fabrics they have classi-
fied as takin : the 30-cent rate, thus indicating the un-
certainty of the position taken by the rational Recovery
Administration:
" ie it resolved by the Southern Garment Manufacturers
Association, Inc., representing and speaking for the 214
manufacturers of cotton pants in the southern states,
operating 28,423 machines, that the dicision hereinbefore
referred to be protested to the Cotton Garment Code
Authority, the National Recovery Administration and the
Senators and Representatives in Congress from the 14
Southern states, as being .holly unfair and discrimina-
tory against these manufacturers representing 93a of the
industry as well as to the consumer of these pants, the
working classes of the people and the farmers whom the
Recovery Administration is endeavoring to aid; and
"3e it further resolved that the Cotton Garment Code
Authoritv be requested to secure a stay of the Order re-
ferred to, entered on March 16, 1934, modifying the re-
lated order of December 18, 1933, and that the Cotton
Garment Code Authoritv be requested to secure a. further
hearing with General Hugh S. Johnson, the Recovery Ad-
ministrator and allow an opportunity of placing- before
the Administrator such facts depicting the injustices
placed upon the Southern industr"- and the economic hard-
ships imposed upon the working man and the farmers con-
suming these cotton pants.
"Certified to be a true an'" correct covy of Resolution
adopted by the Board of Directors of the Southern Garment
Manufacturers Association, Atlanta, Georgia, March 24, 1934.
"W. Gordon KcKelvey, Secretary, Southern Garment Manufac-
turers Association, Inc." (*)
(*) Resolution dated i larch 24, 1934, from the Southern Garment Manu-
facturers Association, Inc. (Cotton Garment Code Files.)
9782
-383-
"I an enclosing for ; r our consideration a letter from V.v.
T. P. Kennedy, Jr., O'Bryan 3rothers, Uashville, Tennessee,
relative to the Southern Garment Manufacturers association
Code.
''I will appreciate it if yo\i "'ill advise me lion I may answer
his letter." (*)
"le: Resolution of Southern Garment Manufacturers' Asso-
ciation protesting Administrative Order of i arch 15,
1J34, and a^iin^ a stay of its operation.
"Your letter of April 5 enclosing a copy of the resolution
above mentioned hi c Deen called to in:' attention.
"The resolution a'oove mentioned relates to the classifica-
tion of 'cotton wa c h suits and pants' and the application of
appropriate wage rates to establish fair competition, which
is the subject and ouroose of the Administrative Order of
March I s . This is a very complex and difficult "oroblem. It
involves both the Cotton Garment and the Men's Clothing In-
dustries which have different code r/age rates for garments
which compete in the same markets.
"In this overlapping field of production, a failure to make
accurate classifications can produce widely variable labor
costs and serious injur" and damage to competing units in
these Industries. Unfortunately, efforts of representatives
of the c"o Industries failed to reach practicable agree-
ments on the subject. In these circumstances the national
Recover-^ Administration is making a special study of the
subject and is making classifications for current use.
"It is hoped operating under these current classifi cations
will be corrective and ■oroduce cost data which will enable
the Industries themselves to determine what further adjust-
ments may be necessary to establish fair competitive condi-
tions of operation. A final arsctical solution of the problem,
as you will readily see, must achieve this object.
"You. may be assured that until this object is attained the
ject will remain one for searching stud:' - and. consideration. 1 ^**)
G. Protest from Associated Pants Manufacturers .
The Associated Pants Manufacturers of America 'held 'a special meeting
in Chicago on Ma- 5, 1934, and submitted to the Admini strati on the fol-
lowing resolution protesting the amendment, • sting certain '-age raffces
and reouesting another hearing on the subject.
(*) Letter dated Aoril 5, 19 , *c .M . : ' afcj 3lla,r, 'J. 3. Senate, to
General Hu::h S. Johnson. (Cotton Ga -ment Code files.)
(**) Letter date< Ap«rLl 11. 1S34, from fu i S. Johnson, Administrr.tor,
to Senator Menneta Mcliellar. (Cot to - : ~ nt Code Piles.)
9782
384
"A special meeting of the Associated Pants Manufacturers of
Anerica, one of the truly representative trade associations
legally recognized, as such, under paragraph B of Article IX
of the Code of F^lv Competition of the cotton garment in-
dustry, was held at Chicago on May 5, 1934, for the purpose
of considering the executive order of the national Recovery
Administration, modifying the cotton garment code with respect
to the pants industry, which said order was effective March
22, 1S34, running to July 1, 1934. The above published order
was read and offered for debate at the meeting. After full
discussion thereof the following resolution was offered, ap-
proved and declared to be the unanimous resolve of the as-
sociation and directed to be transmitted through the proper
authorities to the Special Administrator appointed under the
order above mentioned, for consideration by him:
"WHEREAS the association desires to go on record as fully
approving the general aims and purposes of the order -under,
consideration, insofar as it tends to benefit the industry as
a whole, and
"WHEREAS the association after a close analysis of said order
and full debate thereon, questions its enforceability for the
following reasons:
"The words 'work and 'dress', referring to pants and pant
factories as used in the order, obviously refer to the use to
which the garment is to be put by the consumer, and, to the
factories producing a particular type of pant, respectively.
"The association asserts that the division of the industry, by
classification of its products on the basis of use to which the
garment is to be put by the consumer, is impractical because
of varying geographical, economic and elimatic conditions
throughout the country, which influence the use to which the
garment is to be put, and fur liter because o'f the obvious in-
ability of any enforcing officer to definitely ascertain, from
the manufacturers' records, the proper compensation nr rate of
compensation to be paid for labor on any particular clas-
sification nf materials, as defined in the order, or to ac-
curately determine the proper use of the garment manufactured,
or to determine its proper classification under the «rder. To
exemplify the above objection:
"Most manufacturers make 'work' and 'dress' pants. In such
factories, the workers operate indiscriminately on whatever
'wcrk' or 'dress' materials may be then in work throughout
the shop. At. '.the end of a given payroll period a worker is
entitled to compensation, but may not have earned enough to
bring him up to the thirty- two and one- half cent (32^) minimum
as fixed in the order. In such case it is impossible for the
enforcing officer, the worker, or the manufacturer to
9782
-3^5-
determine upon v:h?t basic minimum r< te such compensation
sh oul c b e c omput e d .
"The order attempts to classify materials or the basis of
content, description, or words in common use in the trace.
The history of the industr*' lead.s the association to the
conclusion that new fabrics will be introduced or net/ or
alternate uses found for present frorics. At such time it
•.."ill be necessary to obtain an executive decision on each
nor frbrdc that mp" be so introduced or on the change of
usage of the existing fabric, which, obviously, will in-
volve -reat expense, inconvenience, tine and oela - ", and it
is also apparent that such decision cannot be rendered
until after a prolonged use of such fabric by the manu-
facturers during r ?hich time the members of the industry will
have suffered many months of unfrir competition.
"The association is unanimously committed to e polic3' r of
cooperation "ith the administration in the promulgation and
enforcement of all proper orders ?nd '"ill assist to the
fullest extent collectively and individually in the enforce-
ment thereof.
"The association, comprising as it does, members of long ex-
perience and excellent refutation, is o^ the opinion, iowever,
that the executive order as vrritten rill not accomplish the
purpose for which it ".as drawn anc. as a uractical' matter is
incrpable of enforcement.
"T7HEEEAS further, it is not the purpose of the ' association
to point out theoretical anc practical objections to the
order es written, without offering suggestions based upon
the experience of its members which mi at lend to a proper,
fair and enforceable order;
"NOtf", THEEEFOHS, we respectfullv submit that in order to
obviate the necessity for the classification of "jp.rmer.ts,
according to the use to which the - * will be put o'- the con-
ramer, to remove the necessitv of complicated, expensive and
unnecessary bookkeeping paid production records designed to
prove, or attempt to reflect, which, garments "ere made, sn<~
by what employees, and "or '."hat period of time they operated
thereon during an - ' - -iven payroll period, and to overcome the
objectionable necessity of paying t~-o scales for various
classes of materials manufactured in the seme factories, end
to obviate the necessity of special recurrent hearings' before
the Administrator concerning ne r fabrics and new uses of
existing fabrics that will be introduced into the trade in the
future, it is. our recommendation thpt all men's and bo2''s l pants
should oe manufactured on one basic minimum ?r.C thgt the scale
recommended be thirty-five cents (35,:) per hour for the nor-
thern section of the industry end thirty-two (32rf) ner hoar
for the southern section of the industry. This, basic rate is
9782
. -386-
to apply indiscriminately in all pant factories without
regard to any classification of materials used or of the
use to which such garments will oe put "by the ultimate con-
sumer, and in accordance with prevailing Code Regulations as
t o hours ,
"It is the, belief of the association that any division of the
industry on a basis of the use to which the garment is put
will he unsatisfactory, 'out if the single minimum rate for
all pants cannot be agreed upon and no other similar proposi-
tion can be substitute^ then it becomes evident that a solu-
tion on a basis of classification will be necessary. In that
event the association believes that the only practical classifi-
cation which will eliminate future misunderstandings and the
necessity of future hearings on new fabrics and which will
simplify policing of the industry is the classification of the
industry on a basis of the content of the cloth that goes into
the garment, i.e. pants made of one hundred per cent (100$)
all cotton content on the thirty cent (30(0 rate in the south
and the thirty-two and one-half cent (32^) rate in the north
and all other trousers to be on the thirty-four cent (34(0 rate
in the south and the thirty-seven cent (37^) rate in the north.
Regardless of the basis of the classification agreed upon, the
association is of the opinion that for the purpose of removing
and eliminating unfair competition, that the thirty-two and one-
naif cent (32-g-tff) rate fixed for the north and the thirty cent
- (30(0 rate fixed for the south shall apply only to those factor-
ies manufacturing pants which fall exclusively in the lower
bracket of said classification and that wherever a manufacturer
also makes pants which would require the higher rate (thirty-
seven cents, 37(* for the north and thirty-four cents, 34^, for
the south) he must pay labor at that rate for all garments
manufactured in his factory, regardless of the type of garment
made or descriptions of the fabric used. Any manufacturers
desiring to make pants upon which the thirty-seven cent (37(0
scale is fixed in the north and the thirty-four cent (54(0 rate
in the south, and also desiring to make pants upon which the
thirty-two and one-half cent (32-|(0 rate for the north and the
thirty cent (30(0 rate for the south is fixed, may do so pro-
viding his operations are performed in separate manufacturing
units, separated in fact and by records, which said separation
must be approved bv, the Administrator or his deputies. In the
event a manufacturer 1ms separate units operating under both
classifications and requires the services of any worker in
both units, such worker so used shall receive the highest
guaranteed minimum wage for all hours of labor in both units
during such payroll period, and
"Wherever any minimum wage scale is set forth, recommended,
referred to or used in this resolution, such wage scale is
fixed with reference to a forty-hour week under Article III,
Section A «f the Code of Fair Competition for the Cotton
Garment Industry,
"WHEREAS further, the association believes it to be imperative
9782
-337-
that the matters herein set forth be determined forthwith
since the manufacturers of the fall pant lines of 1933 and
of. the spring pant lines of 1934 have teen subjected to a
considerable a.mount and degree of unfair competition in the
trade due to varying interpretations and conco--a.ions among
the trade itseli of the previous orders, an' -Vac to the delay
in the promulga.tion of such orders and due to general mis-
understandings, and
"WHEREAS the V'-anufactacrers arc how about to introduce their
.fail pant lines of 1934 to the trade, it is imperative that
these matters "be giv:n immediate consideration.
"KOW, THEREFORE, he it resolved that the administrator he
ad he is hereby requested to summon a meeting of all pant
manufactuerers to be held in Washington at the earliest
possible moment, after giving due notice thereof to all
of such -sr.rufactr.rers , the purpose of such meeting being to
the:", and there fix a definite method, cither of enforcing
the present executive ord.r or to promulgate a ney order
according to the suggestions herein contained, or to suggest-
ions to be made at such meeting for the protection of all
members of the industry and in furtherance of the principles
of the national Industrial Recover;' Act." (*)
III. Report of Special Administrator Godfrey Eloch.
hr. Bloch, in the course of his investigation, visited nearly
ail sections of the country, discussing the question with the manu-
facturers, checking production problems in. their plants, etc. He
found general unwillingness to comply with the new amendment, with no
genuine attempt by the Cotton Garment Code Authority to enforce such
compliance. So' he and his stafi were able to do very little in admin-
instering or supervising enforcement in respect to single pants and
"ash suits, and his work actually became merely a fact-finding in-
vestigation. He collected co L production statistics and data on
the basis of an annual -oroductien of 55,000,000 pants, and based his
report (ccmrlete report follows) on information obtained from the
analysis of these figures.
General Hugh S. Johnson
Administ rater.
Report of Special d&ffiiriistrator appointed pursuant to
rutive Order of ; arch 15, 1334, being amendment No* 3
to the Code of Fair Competition of the Cotton Garment In-
;.stry, with resrect to lien's and Boys' Pant s and Wash Suits*
Both at the time of p'iic original order of December 13, 1933, amend-
ing codes for the hen's Clothing Industry and Cotton Garment Industry
(*) Resolution of Associated Pants 'fanufacturers of Anerica, dated
hay 5, 1934* (Cotton Garment Coco Piles.)
9732
-58 3** "
and at the 'time of -the amendment to the Coda of the Cotton Garment ■*
Industry of March 15, 1934, many firms were operating on Doth pants and
v;ash suits at the minimum prescribed by the Cotton Garment Code, namely
30{* South and 32-?$ ilorth, instead of at the wa^es prescribed by these
amendments, namely 34^ South and 37^ North,
At the time that each of these orders v/as promulgated a substantial
section of the industry was paying the newly prescribed rates or better.
Other sections of the industry were willing to comply and did comply..
Still other sections of the industry fravkly failed altogether to com-
ply with these rates, and naturally, such non-compliance forced some of
the firms in most direct competition with the violators to abandon their
own positions of compliance in order to continue operations on a com-
petitive basis.
The first order was an attempt to put into efiect a compromise
betv/cen the positions of the two contending Code Authorities.
While not directly concurred in by them, it did represent middle
ground between them. The second order embodied carrying out of the
substance of the earlier' one.
These solutions representing middle ground were not necessarily
the most practical or easiest possible solutions to comply with.
Further, being the' result of contention between the parties there "
was serious unwillingness to comply with same. It may properly be said
that however poorly conceived, these orders never had a fair chance,
as at no time did the cotton Garment Code Authority vigorously under-
tafce* t$ »rtfoi»ce suo'h fiomnlianee.
It has been Fep^pted in the ■Jess that fallowing the i-.susuae.i3 of
the earlier order, the Board of the Southern Garment iianufacturers
passed a resolution to continue the production of cotton pants on the
basic minimum wage of 3C$ per hour.
The Special Administrator had occasion to travel over most of the
country, beginning shortly after the issurance of the second amendment.
He did not find clear indication to the Trade by the Cotton Garment
Code Authority that the amendment had to be complied with. On the
contrary, the emphasis put on application for stay rather than on the
provisions of the amendment, left most of the trade interviewed under
the impression that the matter was in abeyance and that immediate
compliance was not required.
Furthermore, when the label provision of the "Cotton Garment Code
became effective, labels were issued freely to firms whose payrolls
did not indicate any compliance with the 34 - 37^ wage level where
required.
No valid conclusions arc therefore to be drawn with respect to
the enforcibility of this type of provision cither as drafted, or such
improved provision as might be made effective.
The reaction of the cheaper manufacturers tu the orders, wac hjrwo-vor^
9732
-389-
clcarly adverse.
Unable in the face of these circumstances to effect compliance,
the " T ^w York office of the Special Administrator "became almost entirely
-re pr.ee* to the ants situation a fact finding office.
The Government having furnished no staff, the personnel of the
various Code Authorities was freely used or "borrowed from.
She s cific infor lation compiled on pants was accomplished with
the assistance of s statistician paid jointly "by the Cotton Garment and
lien's Clothing Code Authorities; a Secretary loaned "by the Dress Code
Authority, The information was collected by the field men of the Cotton
Garment Code Authority and "by eight full time investigators loaned "by
the Lien's Clothing Code Authority and was compiled "by some six compto-
meter operators and typists borrowed from Code Authorities.
The information compiled was on the basis of an annual production
of 55,000,000 pants and represents probably more detail than previously
collected on this subject.
The statistics indicate that the line of division drawn in the
executive orders which were the result of negotiations* and compromise,
is probably the least practical line of division that could have been
chosen.
The material appended which needs close study for drawing con-
clusions therefrom indicates in general terms:
1. That there is nc line of division between the lower and,
higher wage level branches of the industry that will not
cut through some homogeneous businesses.
2. That if a division is made, if all pants are treated in
one category and a special wage level established for them
different from other cotton garments, such wage level should
not seriously inconvenience ir cut through greater than 20$
of the industry affected.
3. That if the proposed line of division were on the basis of
all cotton fabrics versus other fabrics, such line would
cut through approximately 70s of all the production involved.
4. That the present line setting the lower wage rate for
certain "lower cottons" at a higher rate for all other
ids, cuts through approximately 92$ of the production.
If the 36 hours should be adopted for the Cotton Garment Industry
and rates proportionately raised, the simplest solution would of course
be to have pants and wash suits t nanufactured at such increased
rate. This would represent only a slight reduction from the present
unenforced rates, but would by virtue of the uniformity in the provis-
ions be as rwa&ily enforcible as the general minimum wage.
It is therefore recommended that
97S2
-390-
1. For Administrative purpose all single pants be put
together if possible under one code or a division oi one code.
2. That the provisions of such code have the minimum wage and
hour provisions of the Cotton Garment Code if such Code shall
have been put on a 36 hour basis with proportionate wage increase.
3. That otherwise such code be ' on a 35 hour maximum with minimum
wages of Z'7<h in the North and 34{* in the South.
4. That if the Administration does not see fit to unify code
status of all single pants as recommended, the wage provisions
be as above, and jurisdiction be settled as follows:
All wool and part wool pants to be put under hen's Clothing
Code, All cotton pants to be under a Cotton Garment Code divi-
sion at the 34-37..' minimum wage rates and 36 hour maximum; and
further.
That rigid enforcement of the above provisions be required as
a condition of maintenance of any jurisdiction by the Cotton
Garment Code .
5. That a study of men's and boys' wash suits as somprehen-
sive as that just made on pants be undertaken at once. And
that jurisdiction be determined following the results of such
study.
6. That the wages and hours for wash suits be identical with
those set forth above for single pants, and not ':ubject to the
minima for cutters and pressors now in the Clothing Code.
7. That wherever the above solution shall result in necessity
for duplicating reports and inspections, arrangements be made
as far as practicable for the furnishing of such reports to
one source, and the relaying of same to the Code Authorities
entitled to receive same.
i
Appended herewith are cojDies of work-sheets and tables showing
findings of the statistical survey made and copies of the preliminary
reports leading up to the second Executive Order.
Respectfully submitted,
Godfrey Bloch ( signed)
GODFREY BLOCH
Special Administrator
Approved by
SOL ROSENBLATT
Division Administrator
9782
-391-
A. TABLES SJEMITTED WITH REPORT
TABL3 I
BHEAKDOWN. OF PANTS MANUFACTURED ACCORDING TO
fabrics used:
Firms Pants
Number ^ Quantity ^
1. - Firms making only cotton pants (Fars )
and quantity of pants produced 83 24.06 15,645,893 28.14
(a) Manufacture of cotton pants
in lower bracket only 56 16.23 4,062,575 7.31
(b) Manufacture of pants in
higher and lower bracket
cottons 27 7.83 11,583,318 20.83
2. _ Firms making cotton pants and
also wool and part wool pants. ... • •
and quantity of pants produced 235 68.12 39,343,890 70.75
9782
-392-
TABLE II
BREAKDOWN OP FIRMS IIAKING ECKEB GRADE COTTONS
(EITHER EXCLUSIVELY OH ALONG I7ITH OTHSH FAB-
RICS) TO SHOT/ PERCENTAGE OP THE TOT.iL PROMO-
TION (QUANTITY) REPRESENTEE 3Y THE LOTJER BRAC-
KET COTTONS
No. of
Firms
1« - Less than 25$ ».*.. » . . . •> •> ■> 53
2. - 25$ to 50$ ...... *•• 54
3. - 51$ to 75$ ....... » > . 55
4. - Over 75$ ....... <-.°° HI
9782
-393-
TABL2 III
HR3AKD0W1I OP FIRMS LIAEE1IG WOOL AMU PART WOOL
PANTS TO DETSRI.IIHE PERCSNI'AGIS OF THE TOTAL
PRODUCTION MSPRESEITTED 3Y WOOL AID PART TOOL.
Pirms Pants
Number fo Quantity fo
1. - I7ool or Dart tooI less (Pairs)
than 25jf 111 32.16 22,447,643 40.36
2. - Wool or part ttoo1 from
25$ to 50$ 78 22.61 11,065,693 19.90
3. - Wool or part v/ool from
51$ to 75$ 33 9.57 4,337,755 7.80
4. - Wool or part vool over
75$ 28 8.12 1,521,482 2.74
9732
-3P4-
TA3LL IV
Sheet No. I
TOTAL QUANTITY OP PANTS LIAiJUTACTUBED ACCORDING TO GEOGRAPHICAL DISTRI-
BUTION: (PAIRS)
Wool and
Lo i .7er
Higher
Total
Part Wool
Cottons
Cottons
Pants
Louisiana
—
582 s 513
13,476
595,989
Mississippi
—
495,481
62,712
558,193
Tennessee
14,839
521,744
341,243
877,826
Alabama
61,099
545 ,'841
143,340
750,280
Georgia
233,289
1,619,298
1
,215,617
3,068,204
N. Crrolina
100
2,776
_
2,876
S. Carolina
.60.000
—
„_
60.000
Southeast
369,327
3,767,653
1
,776,388
5,913,368
S. E. Percent.
3.80$
13.39$
10.29$
10.63$
Texas
188,506
2,755,655
973,175
3,938,540 * 21, 204
Arkansas
4.128
113.293
178.896
296.317
Southweat
192,634
2,868,948
1
,152,071
4,234,857
S« y. Percent
1.98$
10.19$
6. 68$
7.62$
Virginia
9,531
1,262,597
2
,412,408
3,684,536
Kenticky
—
24,000
—
24,000
17. Virginia
518,258
427,125
100,618
1,046,001
Maryland
436,756
2,350,922
1
,896,129
4,743,877
Missouri
40.046
1,456.046
1
.012.838
2.508.930
Border States
1,054,591
5,530,760
5
,421,993
12,007,344
Bo. St. Perc.
10.85$
19.65$
31.43$
21.59$
Pennsylvania
640,329
2,351,765
1
,745,969
. 4,738,063
New Jersey
135,156
623,278
562,620
1,321,054
Ner; York
4.302.052
6,064.205
3
.043.262
13.409.519
Mid. Atlantic
5,077,537
9,039,248
5
,351,851
19,468,636
M* A. Perc.
52.26$
32.12$
31.02$
35.01$
Ohio
528,892
710,310
925,297
2,164,499
Indiana
318,452
1,418,590
780,872
2,793,632 *275,718
Michigan
456,760
406,601
369,035
1,232,396
Illinois
855,977
1,110,380
400,856
2,396,853 *29,640
Wisconsin
1,728
76,848
2,436
81,012
Minnesota
—
5,857
—
5,857
Iowa
996
62,553
4,500
68,059
Nebraska
—
3,780
__
3,780
Kansas
— _
57.012
__
57.012
Mid West St.
2,162,805
3,851,941
2
,482,996
8,803,100
M, W. S. Perc.
22.26-1
13.68$
... 14*39$
. 15.83$ ._
9782
Sheet II
-395-
TOTAL QJJAL'TITY Op PAIITS i.IAlnJTACTin^D ACCORDING TO
GEOGRAPHICAL EISTRITUTIO".:: (PATHS)
Colorado
Calofirnia
Washington
Uta .
Wool and
Fart Wool
3,235
104,944
64,554
4.044
Loner
Cottons
30,291
145,843
293,706
85.944
Higher
Cottons
59,412
28,748
555,784
1.97?
88,160
Total
Pp.nt s
92,938
279,535
358,270
89.938
820,731
1.43£
Western States 176,787
West. Percentp ye \ e 2>2%
■ 51#
Mas s achus e 1 1 s
Maine
Connecticut
Vermont
i'levr Hano shire
610 , 907
25,138
25,049
300
1.332
1,759,230
7 24, 648
51,328
300
40^596
594,904
17,625
2,853
7.644
2,965,041
68,461
79,230
600
49.572
ITew Eng. States
H. E. Percentage
653,776
3« 85, j
l,u75,102
6. S7', j
523,026
3.61',j
3,162,904
5.69$
1,197,390
S.15#
"165, 700
List. Columbia
D. C. Percentage
19.286
.20^
655, 760
2.32*£
357,144
2.07;.j
GEAHD TOTAL %716,743 23,146,196 17,254,629 55,608,830 *492,262
Hote:
*Totals only, no breakdowns given as to woolens and cotton:
9782
,396»
I^JLZ, V
ITU1.IBIE Or COIJP.4ITKS HjCLUSEE) III THE PUTTS
SURVEY OBLIGED TO PAY THE 34^-37^ LIIHIiIUl.1:
Violation - • Coirrglir-nce Total
90 56 145
62$ Z3fo lOOfo
9782
-397-
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A..EOJ-EJT ,10. 7 TO CPTTOil GA3LEICT CODE, AUGUST 21,1934 .
I. Contributing Events Prior to this Amendment.
The more favorable hour and wago provisions of the Cotton
Garment Industry Code had been subject to steadily increasing
criticism and complaint from all the other garment industries.
Up to now the Administration had in reality been "ducking the
issue," and talcing no steps, as provided for in the original Cotton
Garment Code, to officially consider the desirability of reducing
the hours permitted by this Code. However, in view of these uni-
versal and pronounced protests, it was deemed necessary to call a
public hearing for full discussion of these provisions, and both the
Ken's Clothing Code Authority and the Dress Manufacturing Code Au-
thority submitted applications for amendment or modification of their
Codes in relation to garments on which there had been serious over-
lapping controversies with the Cotton Garment Code.
A. rotice of Public Hearing June 18, 1924 .
So on May 31, 1934, the Administration issued a notice of pub-
lic hearing to be held on Jane 15, 1934 (Later notice of June 7, 1934,
postponed this hearing until June 18, 1934,), Schedules A and C read-
ing as follows:
"Schedule 'A'
" Cotton Garment Industry
"1.
"Whether Article II, Section (a) of the Cotton Garment
Code shall be amended to read as follows:
"A. As used in this Code the term 'Cotton Garment In-
dustry' means and includes the production by any of the
following processes: (a) cutting, (b) creasing, ( c)
sewing (all or part of the garment), ( d) trimming, (c)
pressing, (f) finishing, (g) examining and inspecting,
(h) boxing, or all of them of any article or garment,
and known as (l) overalls, dungarees, overall jackets,
and coveralls; (2) men's shirts, including knitted outer
shirts and polo shirts; (3) boys' shirts and blouses;
(4) work shirts of any material, including flannel
shirts; (5) pajamas and night shirts; (6) men's col-
lars; (7) oiled cotton garments; (3) nurses' and maids'
aprons and uniforms; (9) washable service apparel.
9782
-399-
"Whether Article II, Section (b) of the Cotton Garment
Code shall be deleted. t '•
it %
"Whether all references to any of the products not here-
inabove defined in Article II, Section (a) and all refer-
ences to 'cotton wash dresses', shall be deleted from
every Section of the Code of F a i r Competition for the
Cotton Garment -Industry wherein so referred to.
"Whether the hours of labor shall be reduced from the
present forty-hour maximum and if so, whether the basic
o rates shall be changed.
"Whether wage rate provisions of the Code should be modi-
fied to provide for
"(a) Minimum wa ~:c for cutters;
"(b) Scries for other skilled workers."*
"Schedule 'C'
"Amendment to the
Code of Fair Competition for the
Ken' s ■ Clo thing Industry -
"Paragraph 1 of Article I shall be amended to read as
follows:
"'The term "Men's Clothing Industry" as used herein
is defined to mean the manufacture of men's, boys',
and children's clothing, uniforms, single knee-pants,
men's and boys' pants, men's and boys' wash suits,
men' s and boys' summer clothing, ma.clzinaws, lumber-
jacks, Melton jackets, sheep-lined and leather (in-
cluding imitation leather fabric) garments, play and
sport garments.
(*) Schedule "A" attached to notice of public hearing To. 15-11,
20-E an<? 10-3, dated may 51, 1934.
9782
-400-
" Article XIII shall be amended to read as follows:
"'The membership of the .ien's Clothing Code Author-
ity shall be increased by two members who shall be
representatives of the. groups or associations and/or
manufacturers who shall be found to be truly repre-
sentative of the members of those industries which
have been added to this Code pursuant to the amend-
ment of Paragraph! of Article I." 1 *
3 . Protest Letter to Industry by Cotton Garment Code Authority .
The Cotton Garment Industry, as always, opposed to any re-
duction in hours, strenuously objected to the calling of this hearing,
and the inclusion of the proposed changes in the other two Codes which
would seriously affect their Industry. On June 6, 1934, Mr. H.C.Morgan,
Executive Director cf the International Association of Garment Manufac-
turers, sent the following letter to all members of the Cotton Garment
Industry, urging concerted action, in opposition to these proposed amend-
ments.
"TO ALL hShBERS OF COTTOh GARhEt'T DEDUSTRY :
"On June 4, 1934, a copy of the Notice of a
Public Hearing to be held in Washington, D. C.
. on June 15, 1934,- was mailed to you by the
Code Authority.
"The following action is proposed by the national
Recovery Administration, subject to aforesaid pub-
lic hearing:
1. Place 'cotton wash dress' manufacturers
under press Manufacturing Code.
2. Restrict work clothes manufacturers: to
'overalls, dungarees, overall jackets, and cover-
alls' under Cotton Garment Code and place balance '•
of' their products under lien's Clothing Code.
3. Place 'boys' wash suits' under Lien' s
Clothing Code. :
.4. Place 'men's and boys' pants, when made
in work clothing factories' under Men. 1 s Clothing
Code.
5, Place 'sheep lined end leather garments'
under lien's Clothing Code.
(*) Schedule "C" attached to notice of public hearing ITo. 15-11,
20-a, and 10-E, dated i lay 31, 1934."
973^
.- l~
6. Place 'men's cotton wash suits' under
.'.en's Clothing Code.
7. Propose a reduction in maximum hours
and an increase in basic wage rates in entire
Cotton Garment Industry.
Establish separate higher minimum
wage rates for cutters and ether skilled wor):-
ers in entire Cotton Garment Industry.
"We are convinced that any attempts to.effectu
ate such radical and dan serous pro-oosals as
above enumerated wcxild result in:
1. A serious and drastic curtailment of
employment in the industries affected.
2. A curtailment of production . to the
extent. of. loss to the manufacturers affected.
3. ■aaising retail prices to a point where
s- les will become stagnant.
4. A consumer's buying strike due to their
inability to absorb increased costs for these types
of wearing apparel.
"We believe it is ex-tremely important and urgent
ti-iat you register active protest to the above pro-
posals through any channels available to you, and
especially:
1 . Senators
o
^ .
congressmen
3. Chamber of Commerce
4. national and LccO.
Tra.de Associations
5. Consumer organizations
(Women's Clubs, etc.)
!, 7c. desire to impress upon you the importance of
arranging to appear personally at the public hear-
- . .io- ever, whether or not you can do this, you
s.-oulc immediately notify the NSA that 'you desire
to be personally heard at this hearing. Do this
by either wirttcn or telegraphic reouest, to be
auc'rensed to:
:.'r. William p._ p a r isworth,
' • • • Acting Division Administrator., Room 4221
Depart:.. ent of Co:., ;crcc Duilding, '
Washington! D. C.
9732
-402-
"In your letter, advise him of your desire to
be personally heard. Advise him what subjects
you will cover. Send a copy' of this letter to
the Cotton Garment Code Authority, 40 Worth St.,
hew York City. Then make up a statement cover-
ing that which you will discuss. Lay emphasis
on facts, figures and statistics. Send an advance
copy of this document to the Code Authority.
"We especially desire that you shall appreciate
that this forthcoming hearing is absolutely
vital to this Industry and that volume repre-
sentation by our members, at the hearing, to-
gether with the filing of a large number of re-
quests to be heard, is paramount. Please, there-
fore, carefully consider our suggestions above
and act at once.
"We assure you that it is our intention to co-
operate to the fullest extent with you and
that we will enlist all available forces to
circumvent the adoption of these amendatory
proposals which, if made effective, would re-
sult in a chaotic rather than an improved in-
dustrial situation in our Industry.
"This letter is written at the direction cf
Mr. Stanley A. Sweet, Chairman of the Board
of Directors of the International Association
of Garment Manufacturers."*
C. Protest Letters and Testimony Regarding the Calling
of This Hearing .
Mr. Ralph Hunter, Chairman of the Cotton' Garment Code Au-
thority, protested at the hearing as follows:
"During May Mr, Morris Greenbcrg from HRA called
and stated that he had been sent to Hew York to co-
ordinate the apparel codes and the administration of
the codes and asked the Executive Director and myself,
as chairman of the Code Authority, whether we would
agree to a hearing on shorter hours and with compensa-
tory higher wages. The request was brought before the
Code Authority on May 18th and upon resolution made and
duly passed the Administrator was advised that wc would
agree to such a hearing.
(*) Letter dated June 6, 1934, to All ivi embers of Cotton Garment In-
dustry, from W. C. Morgan, Executive Manager, I.A.G.ivi. (Cotton
Garment Code files.)
9732
-403-
"go mention was made at the time that such sweeping
changes in the definitions of our code would be under-
taken at this hearing, nor where the so-called requests
of the dress code and clothing code divulged to members
of our industry until we received a notice of the hear-
ing, dated May 31."*
Division Administrator Rosenblatt, who conducted the hearing,
said in his opening remarks:
"Tow, there may have been some question heretofore
with respect to the purpose of this hearing and the
choice of this particular time at which to hold such
hearing. Apparently, a -;rcat misconception exists
as to the reasons for this hearing, and that raiscon-
ception,, unfortunately, is not confined solely to
members of the three industries whose codes are be-
fore \xs today, but .also to those who purport to have
an interest representing other persons within or
without the industry, although they themselves are
not members of the industry. 11 **
He also referred at length to the qualifying statements as to
definitions and possible future overlapping questions in General
Johnson's letter of transmittal, dated ho vember 7, 1933, accom-
panying the Cotton Garment Industry Code. Ee stated as follows:
"Farther, with respect to the consideration of pos-
sible amendments with respect to hour and wage pro-
visions in the Cotton Garment Code, I desire to read
into the record the following wire under cate of
April 10, 1934, addressed to the Cotton Garment
Code Authority, 40 Worth, Street, Mew York City,
signed by Earl Scan Howard, 'then Deputy Adminis-
trator:
(*) Transcript of Hearing on the Men's Clothing, Cotton Garment and
Dress Manufacturing Industries, Volume 4, Page 1001. June 22,
1934, D a y Session.
(**) Transcript of hearing on the Men's Clothing, Cotton Garment,
--"-Dress "Manufacturing Industries, Volume 1, Page 3.
June 13, 1934.
9782
-404-
" 'Division Administrator advises that an amendment be
offered by your Code Authority reducing maximum hours
from 40 to 56 with equitable wage adjustments to "bring
your Code into better alignment with other Apparel
Code. Please reply.
"And the following wire, rlated April 11, from R. B.
Paddock, Executive Director, of the Code Authority,
addressed to Dr. Earl Dean Howard:
" 'Betel following form letter Administrator statistical
studies now being made to determine readjustment of
hours (stop) request for detail meaning your clause
quote to bring your Code into better alignment with
other Apparel Codes unquote."'*
"A few Administrative Orders were made by the Adminis-
tration respecting the classification of the wash dress
manufacturers, or their establishments, rather, and the
men's pants establishments. The Special Administrator
appointed with respect to those considerations is bound
to report by July 1st to the Administrator. The situa-
tion has proved, although enlightening, rather discourag-
ing from the standpoint of having a construction program
if the same arrangement were to continue as under those
few Administrative Orders. They were temporary and merely
proposed to be for the purpose of alleviating temporary
questions respecting conflicts of definitions and over-
lapping codes, and it was also in view of the fact that
these orders arc about to expire by their very terms, and
because cotton dress manufacturers throughout the United
States are faced with the necessity of keeping their fac-
tories open and not closed with respect to the coming
fall season, that it was determined that these hearings
should proceed forthwith, and without further delay."**
(*) Transcript of Hearing on Men's Clothing, Cotton Garment and
Dress Manufacturing Industries, June 18, 1934, Volume 1,
Page 7.
(**) Transcript of Hearing on Men's Clothing, Cotton Garment and
Dress Manufacturing Industries, June 13, 1934, Volume 1,
Page 8.
3782
~-U>C-
II. Public Hearings of Juno 18 to 32, 1934.
A vast mass of testimony was presented at this four-day
hearing, including statements and briefs from many Senators, Con-
gressmen', Code Authority members and Industry members of the Cotton
Garment, hen's Clothing and Dress trades.. 7o are not primarily in-
terested here in the subject of the reduction in hours, but merely
in statements pertinent to the jurisdictional conflict on single
pants and wash suits.
A. . Arguments of the hen's Clothing .Industry . '
L-Ir. George L. Pell, Executive Director of the uen' s Cloth-
in ; Code Authority, briefly pictured the current situation as
follows!
"Ail attempt was -made to define the distinction (be-
tween pants and so-called work pants) by an Execu-
tive Order in Dc ; ce:aber, 0.933. The Intor-Code Com-
mittee, create d at ' tha t tin; c , so o n found, 'itself
utterly unable to interpret and carry into practical
effect the Executive Order. The result was that
some manufacturers of pants worked under the hen's
Clothing Cocie, some under 1 the Co tton Garment Code,
and I .am sorry to say that- too large a. number worked
under no Code at all. It became apparent that the
attempt to clarify had led only to chaos, or at least
more chaos.
,r ln an effort to remedy this situation, another Execu-
tive 'Order issued in Karch, 1934, which attempted to
segrcgat-e and classify pants on the basis of fabrics,
^ut "again, everyone in the pants industry' was confused
and dissatisfied. Since the issuance of the Executive
Order on h'arch 15, l~ think I am safe in saying that
the status of the pants question has been worse- rather
than better."*
An 'analysis of the statement of H. K. Ecrwitz, Comptroller
cf the hen's Clothing Code Authority, at the hearing of June 20,
1934, is as folloivs:
heports for. 345 firms who manufactured during the
past. year over 55,000,000 pairs of single pants,
were received- and tabulated (truly representative,
as U. S. Census of hanuf actures, in 1931, > reported
30,341,000 pairs of men's and boys' .single pants,
and in 1929, 66,000,000 t>airs).
(*) Transcript of Public Hearing on hen's Clothing, Cotton Garment,
and Dress Manufacturing Industries, June 20, 1934, Volume 3,
Page 620.
9782
-406-
Tabulation disclosed that 74,1 of all the single
pants manufactured "by these establishments were
made "by firms who either specialized in the making
of single pants and made no other product, or who
made their single pants output in separate shops
or factories wholly segregated from shops or fac-
tories making any other product.
Firms specializing only in the making of single
pants manufacture 5c'/o of all single pants,' and
firms having separate snop or shops for the making
of single pants, wholly segregated from other shops
in the same establishment making other products,
manufacture 2lf of all single pants.
In other words, 74^ of the single pants made in this
country arc made by workers who do not make any other
product. In the establishments of firms mailing Vp
of all single pants, there is occasional overlapping
of products manufactured. In some of these shops
single pants may be made during one season of the
year, and other products in the other season of the
year, or 'there may be no rigid division between shops
or sections of the establishments working on single
pants and on other products (which he says are macki-
naws, shirts, and overalls) .
Only 19$ of the single pants manufactured are manu-
factured in establishments where the workers are
employed on more than one product. Claim is fre-
quently made that single pants are manufactured in
appreciable quantities in work clothing factories
in conjunction with work clothing, that is, by the
same workers who make overalls and work shirts.
This claim is .not borne out by the results of the
summary made under the direction of the Special
Administrator.
I repeat — three- fourths of all single pants are
made by workers who do not make any other product. '
On the questionnaire sent out by Godfrey Eloch, 169
firms reported number of workers employed. 57 firms,
making 14,000,000 apirs of single pants, employing
7,700 workers, are paying the higher minimum rates —
34;/- in the South and 37ff in the North. 112 firms,
making 19,000,000 apirs of single, pants, employing
16,400 workers, are paying the lower minimums — 30$
in the South and 32;.,-c in the llorth. "
9782
-4C7-
32fi of these workers arc paid at the higher rate.
Many plants, paying the lower rates, arc manufac-
turing single pants of wool or part wool and of fab-
rics covered in Executive Order of March 15, 1934,
requiring the higher rates of S4 ( v and 37^.
Summarizing, therefore, firms paying the higher rates
employ 32fb of the total number of workers and their
output constitutes >Vi °f the total manufactured by
these reporting firms. Only 26fo of all firms report-
ing made cotton single pants exclusively, and 74$ in-
clude!' wool and part-wool pants among their products.*
Mr. David Drechsler, Counsel for the Lien's Clothing C 0( ie
Authority, stated the views of that body as follows:
"On the pants question there must be one mini-
mum for the North and one minimum for the South,
no matter whether they be members of the hen's
Clothing Code, or whether they be members of the
Cotton Gar lent Industry. That issue is square.
But if you put the members of the pants industry
under the Cotton Garment Industry, you are faced
then with the situation that thirty per cent of
the workers in this land in the industry making
pants will have their wages reduced.
"And therefore we say to you that the entire
Industry should be put under the Lien's Clo til-
ing Code as it has originally been put in the
Code when the President signed it on August 26,
1933.
"The hen's Clo thin'; Industry wants this In-
dustry under their Code, because there is un-
fair competition. The articles are inter-
changeable and are used by the same consumer
for the same purpose. The article is made by
the same workman, trained in the same tools,
and in the art of clothing people. The arti-
cles arc made in the same shops, similar shops,
I should say, and the machinery is the same
kind of machinery. .They are sold to the same
consumers, and the distributor displays them
on the same counter. A suit worn in July is
just as much a suit as one that is ?;orn in
December. A coat worn for protection against
the cold is just as.much clothing, whether you
• call it an overcoat in Baltimore, or a nackinaw
or h' el ton in Duluth. (Then quotes figures given
(*) See Transcript of He ring on Men's Clothing, Cotton Garment,
and Dress Lianufacturing Industries, June 20, 1934, Volume 3,
Pages 526 to 630.
9782
-408-
"by Her'witz,- fifty-three percent of production
made by .manufacturers who make nothing but
pants, etc.) That makes the total .problem less
.than twenty percent who do not operate their
factories as separate pants units."*
: 'r. George Hexter, of the Clothing Code .Authority staff, said:
"Our next .and chief contention is that the
way out of this involved situation is simply
to. establish one minimum with sectional dif-
ferentials, for all odd pants, irrespective
of fabric, of construction, or of use, A
gror/ing number of pants manufacturers in all
sections of the industry has come to this con-
clusion.
. "The Associated Pants Manufacturers, as a body
adopted the sane position, as we learn from
the following account of the meeting held by
this group in Chicago on May 6, 1934. - The
manufacturers at the session included several
from the East and South, and the general feel-
ing was that instead of one minimum scale for
certain pants and a higher for others, there
should be one minimum with a southern differ-
ential applying to all factories. This plan
would maize enforcement much easier and elim-
inate much chiseling.
"From all this it is evident that the insis-
tence on a single minimum for all pants in-
stead of being confined, as has been charged,
to the group of manufacturers located in Hew
• York City is shared by representative pants
manufacturers in all sections of the country,
and has been endorsed by the pants association
having the widest geographical coverage.
"From statement in Daily News Record of
February 16, 1934, by Mr. Oscar Bcrman of
Cincinnati - 'Tie cry and hullabaloo that an
increase of four cents an hour on these gar-
ments is going to put the Southern manufacturers
out of business is certainly without foundation
of fact. The additional cost is about thirty-
five cents a dozen, less than three cents a pair,
(*) Transcript of Hearing on Men's Clothing, Cotton Garment, and
Dress Manufacturing Industries, June 20, 1934, Volume 3, Page 705.
9782
- -
or the equivalent of enc and one-half cents
a yard for thirty-six inch goods. They will
advance their, selling prices - this may or
may not create a little more sales resistance,
"but since the law forbids men to go without
pants, they will eventually buy them anyway'" *
A-n analysis of the statement o,f f.ir. Joseph E. Brill, of the
National Boys' Pants Manufacturers Association, follows:
«
"Fifty- two manufacturers of men 1 s and boys'
single knee pants and long pants in this Asso-
ciation.
"Majority of offices in New York City and_ man-
ufacturing done outside in New York, Hew jersey,
Pennsylvania, and Connecticut, produce 8,500,000
pair, fifteen per cent pf total pants production.
60fj cf production of pure cotton pants
30$ cf production cf mixed cotton
10$ of production of woolen
"Operated under lien's Clothing Code and urged
that all pants be put under this Code; objected
to unfair competition of those manufacturers under
under the Cotton Garment Code, many cf whom did
not even comply with that Code..
"Average additional cost of four and one-half
cents per pair of pants to Lien's Clothing manu-
facturers over Cotton Garment manufacturers.
Results in increased cost of six cents to seven
cents per pair to the consumer. This means total
ccsts of this Association's members arc about
$400,000 more than costs of their competitors.
Price Ranges Manufactured by this Assn ' .
Boys' Pants Wholesale Retail
$4.25 to $22.50 $.50 to $2.40
per dozen per pair
hen's Pants Wholesale Retail
$10.50 to $39.00 $1.29 to $4.50
per dozen per pair **
(*) Transcript of Searing on Men's Clothing, Cotton Garment and Dress
Manufacturing Industries, June 20, 1934, Volume 3, Page 647.
(**) See Transcript of "earing on hen's Clothing, Cotton Garment, and
'Dress Manufacturing Industries, June 20, 1934, Volume 3, Pages
651 to 634 and 653.
9782
r41Q~
B. Arguments of the Cotton Garment Industr;/
Opposing any change in the classification, Congresswoman
Florence P. Kahn of California spoke for the manufacturers of her
state as follows:
"~e have no large clothing manufacturers such as
exist in the East, in California. *.7e have, how-
ever, 135 cotton garment factories scattered all
over the Coast, but principally concentrated in
San Francisco and Los Angeles. . .The particular
item of largest volume in importance "both to the
manufacturers and the consumer involved is this
cotton pants or working pants of 100 per cent cot-
ton content. . .This comprises a large industry giv-
ing employment to several thousand persons — con-
sumers of comparatively low purchasing power, and
could not afford, in any event, to substitute the
type of garment primarily made in the men's cloth-
ing shop... Any change would increase by 20 or 25
percent the cost of such cotton pants. "(*)
The Philadelphia Overall and ".York Pants Manufacturers Asso-
ciation filed the following brief:
"I represent the Philadelphia Overalls and Work
Pants Manufacturers Association, whose member-
ship includes thirteen (13) of sixteen manu-
facturers in our City - all of whom manufa.cture
cotton work clothes and under the Cotton Gar-
ment Code.
"Our membership represents over 85^ of the em-
ployees engaged in these shops and over 85/o of
the manufacturing output. We employ approx-
imately 1200 men and women.
"One of t^e contemplated changes affects our
Industry to such a degree that unfavorable
consideration may mean the death of an Industry
which has as much right to live unmolested and
unrestricted as does the Lien's" Clothing Industry.
"The Notices sent to the Cotton Garment In-
/ dustry advises that you will consider restrict-
ing work clothes manufacturers to .' overalls.,
dungare.es, overall jackets and coveralls' under
the Cotton Garment Code and place the balenca
of their uroducts under the lien's Clothing Code.
(*) Transcript of Hearing on the :en's Clothing Cotton Garment,
and Dress Manufacturing Industries, June 18, 1934, Volume 1,
Pages 12 and 13*
9782
"411-
"In considering this contemplated change it i,s
necessary to see the purpose thereof and then
to consider the results of such a change.
"From the very adoption and approval of the
Cotton Garment Code it was evident that the
lien's Clothing Industry wan malicious^ seek-
ing to make serious inroads and to secure un-
warranted control of on Industry tot-illy un-
connected with i't from time immemorial and in
which they were never interested until the in-
ception of U.S.A. The only' purpose which can
he deduced for this contemplated change seems
to be to increase and '-'iden the market for
lien's Clothing i -nufacturers at the expense
and financial ruin of the Cotton Garment In-
dustry."
"Let us consider the t ,_ o • Industries and we
shall see that this is a fa t. hen's Cloth-
ing manufacturers produce .roolen garments or
garments with an overwhelming --oolen content.
"Their products were never intended for the
laboring class' to he used as work clothes.
They were intended for sport or dress. Their
employees are ill skilled employees whose
- - e scale wfss always materially higher than
in our Industry, hen's Clothing -err and are
handled by distinguished and exclusive cloth
in stores and the better departments of de- .
partment stores. ^lexy rarely, if ever, • ill
you find work clothes and dress or sports
clothes displayed together in the same retail
or department store.
"The contrary is true of the fork Clothes In-
dustry. Its employees are unskilled. Their
"•age scale has been materially, and justly so,
lo^er than that of the -"en's Clothing Industry.
Its products are sold in separate departments
(usually in the basement) of department stores
and in distinct retail stores. '. T ork Clothes
are intended solely for working purposes for
the laborer - not for the 'white collar man'.
The sales prices of work clothes has been
materially lo^er than men'; pants or suits,
'.ork Clothing have never been, and are not,
intended for sports or dress.
"It is inconceivable, therefore, from the
foregoing distinctions to justify this attempt
by the hen's Clothing Industry to usurp con-
S782
-412-
trol over ',7ork Clothing except on the ground
of a malicious intent to kill the Industry
for its (The Ken's Clothing Industry's)
betterment.
"If the purpose is so odious, the results are
obviously more serious. It cannot be dis-
puted by anyone that the manufacturer of '-'ork
clothes today finds it very difficult to sell
his product since the recent price increases.
A buyers strike already exists and adds to
this difficulty.
"Let us assume, for the sake of argument,
that a change is made, and for iast.-mce, the
manufacture of work pants is controlled by the
regulations of the hen's Clothing Code. There
would be very little difference in the selling
price of Cotton and woolen Trousers. The con-
sumer wo^ld naturally pay the slightly higher
orice and purchase tne "oclen troiisers. The
market for work pants would be serious cur-
tailed. The result would be that irmumer-'.ble
manufacturers of work clothes would, shut down
and. many employees would be out of employment.
For let us not forget that '-rork clothes factories
in our Industry
manufacture 80$ of those gar-
nents, which the
coiitemnl^.ted change seeks to
transfer to the
clothing Code. And 30,^ of our
employees are also affec ted there by. The bur-
den, therefore, is upon practically our entire
Industry.
"The remaining manufacturers would eliminate
and cease the manufacture of Cotton Puits and
products and change their factories to men's'
clothing establishments. This would mean
laying off all the unskilled laborers now em-
ployed and the hiring of skilled laborers for
the manufacturing of men's clothing. The
effect ,-r ould be a bommerangj In time individual
men's clothing factory sales would decrease
because of the resulting competition - entire^
destructive.
"And are we not reasonable in supposing and.
anticipating that the work clothes manufacturer
in restricting his business to the manufacture
of overalls and coverals '.'ill meet the ser-
ious competition of the South?
"It is, for the facts and reasons set forth
hereinabove, respectfully submitted that i
9782
-415-
(1) The purpose of the contemplated
change is both unsound and maliciously de-
structive to one Industry for the exclusive
advantage of another Industry foreign there-
to; and
(2) That the results of such a change
would defeat the fundamental purposes of the
N.R.A. by destroying an old Industry, causing
serious unemployment , and the possible ruin
of the Industry seeking to benefit by the change.
"We, the Philadelphia Overall and ./ork Pants
Manufacturers Association, composed of the
following members who join in this protest,
oppose the contemplated change which would
limit and restrict work clotnes manufactur-
ing under the Cotton Garment Code to 'over-
alls, dungarees, overall jackets and cover-
alls' and place the balance of their (Work
Clothes Manufacturers) products under the
Men's Clothing Code." (*)
Mr. Harry Johnson, of Obermann cc Company, Springfield, Mo.,
claimed ttrt any higher selling prices would, be very disastrous
to manufacturers of cotton pants.
"I am speaking for the following five regional groups
of the Cotton Garment Industry:
Southern C-arment Mfrs. Ass'n.
Central 'Vest " " "
Ohio-India.na " " "
New England " " "
Southwest Work Clothes Mfrs. Ass'n. 41
"Principally located in simll rural communities .
It is our opinion that the prices we are now
obliged to quote are too high for the consumer
Firms
1 achines
Employees
310
35,400
45, eon
57
3,100
4,2on
26
2,200
2,900
76
8,400
s,eon
.. 41
4,o00
5,700
51 n
53,700
68,200
(*) Statement of Facts nd :.i ,vnt Ag"inst the Changes Contemplated
in the Cotton Garment Cdoe submitted on Behalf of the Philadelphia
Overalls ic JorkJ?ants ? anuf acturers Association, Cotton Garment
Cede Hearing, Monday, June 18, 1934.
9782
-414-
to pay with their present income. The demand
for low-priced garments in every direction in
our industry is the proof of this statement.
If any move is made over our protests to in-
crease the prices that the consumer must pay,
we h?ive no alternative bat to protect ourselves
in the courts. The fantastic claim of the
Clothing Code to the cotton pants industry, a
group which cuts three percent of the cloth
used in the cotton pants industry aspires to
govern the other ninety-seven percent.
"It may be noted that the cotton pants industry
has uniformly ignored the so-called pants or-
der for several reasons- first- that the or-
der itself was unintelligible and it was an
impossibility to get an interpretation that
was not in the realm of metaphysics; second -
had a sensible intprpreta.tion been available
it would have been obviously imoossible to
carry it into practice in our industry; third -
the Cotton Garment Industry does not recognize
the authority of R.ny outside bureaucratic or
gariization to set basic rates in our industry
any more thf>n they can do so in the automobilp
or steel industry. T 7e may be smaller but our
rights are th^ s^me. The Cotton Garment In-
dustry is a sf= If -governing body and p>ny deci-
sions ^s to rates and hours can only be en-
forced with the consent of the Cotton Garment
Code Authority. " (*)
C. Testimony Regarding Mackinaws, Felt on 'Jackets, Etc.
While the total volume of production of mackinaws, melton
jackets, sheeplined and leather co»ts, lumberjacks, and similar
garments was comparatively small, the jurisdictional conflict
of the two Codes as to their manufacture had been pronortionately
as acute as on the pants 'and wash suits. At this hearing, the
ken's Clothing Code requested complete jurisdiction over such
garments, and the following testimony was offered both orb and con
on this question.
"This Association founded twenty-six years ago,
among past presidents have been manufacturers
of sheeplined and leather garments, pants and
(*) Transcript of Public Hearing, on Lien's Clothing, Cotton
Garment, and Dress f'anufac taring Industries, June 2<~>, 1934,
Volume 3, Page 847.
9782
-415-
raackinaws.
"The Cotton G~rment Industry is ~lso in industry
representing clothes to work in for mpn, women ->nd
children.
"Sheeolined and leather coats ire TDrinarily working
clothes ind there is no satisfactory reason why they
should be classed otherwise or be moved from where thpy
^re .- 1 present.
"Kackinaws , meltons, and lumberj-ckets hive for decides
been nil integral p-rt of ^ny line which features overalls,
work shirts, flannel shirts, work pints, ind similar poods.
From time to time', garments such as these, develoned
for work use, qre adopted by clothing houses, dressed. ut> n
little, ind for a reason or t< r o sho^n as style orooositions,
This is the only argument, and i feeble one at that, which
^n be advanced to claim that they m»y be identified, is
Clothing.
"I quote from Sweet -Or r ~nd Company's urice list, dated
Spring, 1913, showing three and one-half pigfs devoted
to nacv'lnaw conts alone, and listing seventy- three
different styles. Also orice lists of October, 1926,
showin." eirht pages of so-c°lled knit-bottom jackets,
cossack jackets, meltons, etc.
"Separate pints of ^11 styles have alwys been an
integral part of " cotton garment line. The manufacture
of separate pants, even of woolens and worsteds, his
always been r part of the cotton g"rment industry until
the time, some 'years ago, when clothing houses began
making two pants suits. This gradually took away from
the cotton garment industry - good part -of the higher
grade classes of pants. Cotton pants of any kind, however,
properly belong where they now pre." (*)
"About one hundred plants scattered throughout the United
States - employing sever"! thousand people', producing
garments known as mackinnws, stag shirts, snow suits,
suece ".nd Kelton blouses, etc., designed and. used for
rough outdoor work and plav, and orod\iced and sold in
conjunction with work coats, work pints, =ind overalls.
"Statement as to why they should remain under the Cotton
Garment Code:
(*) Tr^nscriDt of Rearing on fen's Clothing, Cotton Garment,
and Dress ' --nuf acturing Industries, Volume 3, Page 814,
June 20, 1934. (Stanley A. S"-eet)
Chaironn of the Bo=rd- International Association of Garment
i ' 'iuf f'ctarers.
978^
-416-
1. H-ve been origin-ted by some producers as
work garments for strenuous outdoor activities
under severe climatic conditions. These garments
f or t""=lve yPTs or ".ore have been grouoed by the
Department of Commerce with 'ork garments such -s
overalls and work o-nts.:'
2. Style ind metnods of construction and
materials -re so crude - s to be-r no comparison
with the oroducts under the 'I'en'b Clothing Code.
Principal objects of the manufacturers have
always been soeed of production -nJ durable
weiring qualities -=t the e-pense of style, ^nd
- low cost to the workman consumer wno had to
use them.
3. Distribution has been through entirely
different cnannels thin Men's Clothing
The work Clothing departments of wholesale dry
goods houses, chain stores, and main order
houses, and through the ret-iler of work cloth-
ing -nd the rural merch-nt.
4. As use of these garments is confined
to limited se-sons of the year, need flexibility
in hours at peak seasons". (*)
The following is ti analysis of I r, Louis Cohen's statement:
"Manufactures overcoats, ir^ckinaws, mplton jackets.
In clothing business for past twelve years, emnloys
ninety-seven persons, continuous emolovment forty-
eight weeks, sixty-five of the employees have been
with the firm eight or ten years. Pre-Code worked
forty-nine and =i half hours. 1923 Volume of
business $25,000; 1S32 - $188, nnO; 1933 - $23? r 00n ;
first five months 1934 - twenty percent increase'
over 1933.
"An overcct is an outer garment made of wool and p,art
wool fabrics, worn for protection against the elements.
"A rnckinaw is an outer irarmejit mnde of wool and part
wool fabrics, '"orn for protection against the elements.
"The material in their mackina.ws is very often
inter-changeable with the materi.pl used in their
overcoats.
(*) Letter from H.A. S-peh, Chairman, Hough Outdoor Garment Group,
National Work Clothes Kanuf cturers Association, to ".m. P.
Farnsworth. .Tra.nscr.ip of Hearing on ien's Clothing, Cotton
Garment, a n d Dress ! anufacturing Industries, June 20, 1934,
Supplement Mo. 1, page 1.
9782
417-
"The majority of consuners, if they, buy n ijnckinaw,
■"ill not buy -n overcoat.
"A nplton jacket is ^n outer garment nrde of the cloth
from which it derives its name, which is n smobth-
finished all w ool and part wool cloth, conp">r n ble to
the cloth usee for overcoats 'and mackiha T " ; s, ^ind is
worn largely for the same purpose as overcoats ^nd
"i-ckin o '"s , that is, for urotection against the cold.
It is generally made into n blouse effect, "nd very
often has q sipper instead of buttons; it is shorter
thin q mackinaW| and in order to fit tightly about
the w-dst, a lcnit-bottora is sewed on, or the bottom
is provided with stracs. It is used by the consumer
for fishing, outdoor sports, hunting and golfing,
A large oroo-^rtion of the population in their s~les
territory wear melton jackets as a substitute for
m^ckina'-'s '^nd ove\rco^ts, °nd in the last few years,
the younger element, students, prefer melton j-ckets. •
"Since the Cotton Garment Code went into effect
(in November, 1952) their melton jackets h-^ve shown
price resistance , because retailer can buy cheaper from
those manufacturing under the Cotton Garment Code.
Product Prod act ion
19^9 1932 ' 1935 1954
Overco-ts 1<Y$ 60'b 801 9C,%
Mackinaws & Felton — 40? 3 ?n% m%
J-ackets
"?efore the depression this firm made one hundred
percent overcoats. When depression lessened purchasing
power of the consumer, tney h"d to start manuf ~cturinfr
m^ckin^ws. In 195?, mackinavrs r, nd melton jacket comprised
nearly fifty percent of their business." (*)
An analysis of the statement of Julius C. I.'orse, President of
Leopold Morse Company, Boston, Mass.", follows:
"This company manufactures clothing and distributes
through eight retail stores in I.'ew England, fully or
partly-owned. Cvercoats retail from $15.00 ^p; while
(*) Statement of Louis Cohen, of Conen Bros. Jilwaukep, Jisconsin,
Transcript of Hearing, I en's Clothing, Cotton Garment, a nc i
Dress I ~nuf acturing Industries, June 20, 1954, Volume 5, pa^-es
678-66 _
9782
*4TB*»
imckinaw is m^de of the s^me cloth,. and in reality is
nothine; bat a different type of overcoat. -*,
They are sold to customers who come into the stores
looking for lr»e>r- -priced overcoats.. '
"In their stores they display in the s^me section single
p^nts of all wool, part wool, -ind 100* cotton content.
Tney manufacture some of their ""oolen pants, but buy
n ll the cotton, much cheaper than they could afford to
make them under the Ten's Clothing Code. The cotton
sanforized trousers sold in their stores ire not sold
to men who use them for work purposes — tney are sold in
conjunction with knickers, flannel trousers, or garments
used for sport purposes.
"If imckinans were under the Ten's Clothing Code, I
do not think it 'vould affect the retail price ovpt $1.00
in those now made under the Cotton Garment Code.'" (*)
A resolution of the lie" 1 York Sheeplined ^>nd Leather Clothing
Manufacturers, d^ted June 14, 1S34, w s read by f'r. Greef :
"Ne" 1 York rnnuf acturers cons* itute n l^rge percentage
of the entire industry -nd existing piece r^tes in
lie'"' York City -^re uo to 5 r >^ higher than those under
the Cotton Garment Code. Very little cotton in the
garments. That conditions in these firms tp in line
with those provided for under the "en's Clothing Code
— Resolved that they be brought under the Fen's Cloth-
ing Code. "
Mr. Greef also read a quotation from the Daily News Record of
August 5 (1933):
"The National Association of Sheeplined and Leather Garment
Fanuf acturers , Inc., is composed of 53 firms, .employing
4,000, volume $10,000,000 annually. Cotton constitutes
n very small component value in the manufacture of their
garments, a basic horsehide garment contains — one yard all
wool plaid lining, 26 feet horsehide leather, l/2 yard cotton
sleeve lining and -Docketing, 1/2 do?en bone or composition
buttons, and 1 metal buckle. Actual, value of cotton content,
2% of materials used, is 12 cents." (**)
(*) Transcript of Hearing on I en's Clothing, Cotton Garment, and
Dress Lanuf acturing Industries, June 20, 1934, Volume 3, Pages
682 to 684.
(**) Transcript of Hearing on Ken's Clothing, Cotton Garment, arid
Dress !'- anuf acturing Industries, June 20, 1934, Volume 3, Page
685 to 692.
9782
-419-
The following: letter to Congress^om^n Florence P. K"hn, from
filoesser-Heynemann Company, of San Fmncisco, California, ^r.p of
the representative pacific Coast manufacturers, was filod at this
hearing.
"Your telerram of June 11th requesting facts and arguments
for the hearing before the NRA administrator on the Cotton
Garment Code has already been anticipated to a gre^t extent
by my letter to you of June 8th.
"The proposed changes i"ill result in very much higher costs
of manufacture. Costs to the consumer of manuf actored
articles have already advanced very much faster than his
earning power. The result is that retoi 1 tr-->de is at
the present time very seriously effected ^no retailers are
comwen:.ing to l-.y oi'f comoloyees. Similarly the retailers'
purcir :es from manufacturers, even at current levels, h^ve
shown a, very important falling off. The sm^.il orders
ol^cec. with m nuf --ict are rs indicate that the present r^te
of manufacture "ill not be maintained, vliich involves
l^y-offs qid more unemployment, To ignore this situation
and insist on a orocedure which ^ill very materially
increase costs «nd "rill materially further raise prices
to the consumer is si mnly suicidal.
"The argument is freouently presented by the Clothing
Code that the increased rates which exist under their
Code will not make an important difference in the cost
of work garments. This argument is inconsistent '"ith
the presentation th^t they cannot meet the competition
from '-'ork clothing garments if they -^re not manufactured
on the s^me basis as clothing.
"It is a well recognized practice among retailers to
operate ~t specific retail prices, ''hich produce the
best volume of business. To use ^n illustration:
Cordaroy Pant s ^_re being sold for $2.95. I'anuf acturers
naturally are furrushinr the best product th->t i"ill fit
into this retail price. They are forced by competition
to sell on ? close margin and any additional cost must
increase the wholesale price. The retailer is already
paying the highest wholesale price at ■'hich he c°n
n-int^in a re-sale of $2,95. Any increase in his
wholesale price will involve on increase in the retail
price. There is no s^tisf --ctory retail price between
$2.95 and J.3.50. In otiier words, the change of
Corduroys from the Cotton Garment Code to the Clothing Code
will increase the orice of the $2.95 Corduroys to at
le = st --/..SO. This garment formerly sold for S2.45 and
work men's ^ages have not been advanced sufficiently
to en-ble them to pay •-p.5.5 r > for garments which formerly
cost them $2.45.
9782
-420"
"The St ite of C-liforni- 1 has 185 factories manufacturing
all cotton parraents, and r-mi:s sixtn among the States of
the Union in the number of plants'. The products of its
factories are great ly diversified, a condition made necessary
by the relatively sparse oopu^: ion. "Thile a factory with
a sufficiently large output in different lines can be seg-
regated into deportments, e^ch department operating under
separ-te Codes., it is not nracticable for the s^me operators
in one deoartnent to work on " variety of items under
separate Codes with conflicting provisions. The large
eastern pianos wo.J.d tnerefore be only too well oleased
to deorive the smaller institutions in California of the
opportunity for existence; by denying them the right to
manufacture any of the various products which are used
in their own community, under tne only conditions which
are oracticable under the circumstances.
"The Cotton Garment Code Authority h"s as its director,
Colonel -.B. Paddock. I have advised Colonel Paddock
that he can couit on your' support; and have requested
him to place the data of the Cotton Garment Code Authority
at your disposal.
"I want again to express the very sincere ^looreciation
of every member of our industry for tne interest that
vou have t-4'en in this extremely important cause."
9782
-421-
III. Post Hearing Developments -"rior to the Ac roval
of the Amendment
A. 'Let:-rs of Protest, fro:-. Cotton G-arnont In^ustr?-
Definite action by t the Administration on the proposals presented
at these hearings was delayed for two months until August 21,
193d-. Great numbers of protests from all trances of the Cotton
r e t Industry were received. The following letters from the
: erne Ifenuf acturing Co . , Berne, Indiana, are indicative of the
general feeling of many industry menders:
"Your letter of June 13 in answer to my letter of June 8. was
relaid from my office to the Hetf Yorker Hotel in "Jew York Cifcy,
hut unfortunately Uncle Sam failed to deliver the mail to me
on time and it wasn't until this morning that it -was returned
to me here at home.
"I, of course, regret now that I didn't get a cliance to chat
with you in the quiet way which you suggested. It was my
personal feeling all through the Washington hearing that pub-
licity given to the cause would do very little .good and possibly
a lot of harm to everyone concerned.
"I think we get a great deal more done when we can sit down
quietly to discuss our problems without any feeling of an-
tagonir i and rivalry. It is then that we do our best work.
"In the future, if it is at all possible to work these things
out without n lit of fever and demonstration, I feel that the
industry could be saved a tremendous amount of money and time
• hich is now being squandered. Any number of manufacturers
who came to Washington at the last hearing went away in dis-
gust. All they could do was to listen to a lot of things
that seemed utterly foolish to them - express their private
opinions among each other - and then go home after spending from
$150.00 to $300.00 or 3-1-00. 00.
"The rational Recovery Administration cannot afford to alien-
ate the cooperative sentiment of the rank and file manufacturers
in this country in any industry. After helping to formulate our
code from the very beginning, I can truthfully say that up to
the recent hearing, most manufacturers talked, argued, and
operated in favor of our code. There is practically no ob-
jection to control of hours and wages and to the elimination
of dishonest business practices. But when the administration
tries to go farther or when it imposes impractical regulations
with respect to hours and wages, or with respect to the natural
association c: :afacturers , then the Administration breeds
2782
stubborn resistance which will lead to wholesale non-com-
pliance. If you will re-read my brief which I presented
at the luiaring, I believe you will get a pretty fair slant,
not only at the "background w. .ich has "brought us to the point
where we are today, but also to the sentiment that exists in
the industry wheia impractical, unworkable rules anc regula-
tions are forced upon our induscry,
"It is undoubedly true that our present code is somewhat in
conflict with two or three other apparel codes, However, it
isn't :)ur fault that these other apparel codes are operating
under rules r-s^. regulations quite different from ours. Person-
ally, I feel they originally should have had the same hour' and
wage regulations that we have. Because they haven't, they
shouldn't ask our association now - at this particular moment -
to make the changes that are bound to lead to higher prices
when the public already is on a buyers strike. Personally, I
feel that our industry will be read" to cooperate with the
other apparel industries a year iron now in building a more
uniform set of codec, which comply with the new regulations
that will be made by Uncle Sam at the expiration of the present
]>TIRA act. With two years of experience, Uncle Sam will be in
position to write a basic law which will remove some of the
argumentative details while he retains the practical and the
workable .
"Everything should be done to retain the gains we have registered.
These must Dot be lost. If at all possible, we should yet see
to it that prison competition is completely eliminated.- Then
the foundation will have oeen laid to reconstruct the Utility
Garment Industry on a healthy foundation,"*
"In reviewing the recent past in Washington, a few reflections
might be of interest to you..
1. The most unfortunate impression during the Code pro-
ceedings was that both the Ac.mir.is~i£-ation and the Labor Board
lacked the conviction oi downright, honesty of puroose. It
seemed more a question of getting answers favorable to a pre-*
conceived solution that it was getting at the truth. The Ad-
ministrator showed impatience wi I - iy adverse testimony given
by the manufacturers, but shored consistent deference to the
gentlemen of the Labor Eoard. Without honesty of purpose we
can never develop the enthusiasm which alone can give us the
strength to cope with a great problem.
2 a Contrary to the statistics, the re-employment in the
Cotton Garment Industry was not ZEHO. The Cotton Garment In-
dustry is carrying the cotton farmers, has absorbed the pro-
(*) Letter dated June 28, 1S34, from the Berne Ilanufacturing
Co., Berne, Ind. , to ilorris Greouberg, Deputy Adminis-
trator. (Cotton Garment Code Piles.)
9782
423-
cessing tax in it? market and is therefore contributing to
employment, even if it is only employing the farmers to plow
their cotton under the ground.
3. The relation. c? Pric " Incr ease of cotton garments
to the increase in the Pur chasing '.jov.er of the cotton garment
consuming public has not 'been dwelled upon sufficiently.
"If there was $100.00 available for cotton garments in 1932
and garments cost $1.00 each, then of course' the $100.00
bought one hundred garments. In 1934 purchase Power as a
whole rose 7$. \7e had therefore, $107,00 to spend for cotton
ar -.ents. rut the -rice of cotton garments rose 55'i and cost
therefore SI. 55 instead of $1.00 as before. Consequently, the
$107.00 will buy only sixty-nine garments now, whereas one
hundred garments were bought before. This is the strongest
argument, why the industry cannot take on any more parasites
at this time.
•1. A workman buys his work garments first and then
his dress garments. The more he has to pay for his work
clothing the less he has left for his dress clothing. There-
fore, ay merging the two industries, the cotton garment in-
dustry would be choked, without in the least helping the
wool clothing incus try.
5. What the Industry meeds most is confidence and
self-assurance to complete the process of adjustment. The
strike threat lias the most devastating influence upon the
spirit of enterprise so necessary today. Some "- T ew York
Labor Leaders seem to preach a kind of class hatred which
is entirely foreign to the rest of the country which is
striding in the direction nf an industrial democracy. Only
by " eaceful co-operation and mutual support can we reach the
portals to a new any. The true mission of LABOR today is to
help i: . this spirit of mutual support.
6. The first aim of Labor is a sense of security and
permanency of income. That is something to build on, homes
and life itself.
"In the second instance, Labor wants s high income, that
is high wages and short hours,
"If the second aim is overstressed out of keeping with the
advance of the times, the first and much more important goal
might be lost forever." (*)
(*) Letter enclosed with above letter of June 28, 1934, to
tlr, Greenberg. This letter is from P. A. Schmidt to Llr,
C. T. I-'abegger, of the Berne LIfg. Co., Chairman Indiana-
Ohio tifg. Association, Berne, Ind. , dated June 26, 1934,
(Cotton Garment Coco files.)
9752
-424-
B . Deputy Administrator Dean G. E—'ards' Letter
of Recommendation of tne Amendmen ts
After many post-hearing; conferences, and in view of the pronounced
hostility of the Cotton Garment manuf acturers , it was deemed advisable
to make no further changes in definitions affecting the three Codes at
this time. Equalization of hour provisions was "believed to be imperative,
and it was decided to place the Cotton ferment Industry upon a 36-hour
basis, in spite of the refusal of the Code Authority to approve such
changes.
Deputy Administrator Dean G. Edwards submitted the following
letter of recommendation with the proposed amendment to General John-
son, under date of August 8, 1934;
"Submitted herewith is a report on s Pnblic Hearing held
June 13, 1934, to June 22. 1931-., inclusive, called to con-
sider amendments to three coces of fair competition, namely:
the Cotton Garment Code , the Dress Code and the lion's Cloth-
ing Code. At this hearing which were these amendments to the
Code of Fair Competition for the Cotton G rment Industry,
"The following papers are included in this transmittal:
Report of the Industrial Advisory loard
Approval of the Labor Advisory Board
Report of the Consumers' Advisory Board
Report of the Legal Division
Report of the Research a ■ planning Division
Notices of Public Hearing and Amendments on
which he ring was called
o °
Code as approved Fovember 1?, 1353, and sub-
sequent amendments
List of witnesses
Assent of the Code Authority to amendments ex-
cept Section A of Amendment II and Sections
A and B of Amendment III.
"It will be noted that the Code Authority in their letter of
assent ap" roved the amendments with the exception of the ones
relating to hours and wages. We are recommending the imposing
of a thirty-six hour work week (Section A of Article III) with
no reduction in the weekly wage (Sections A and B of Article IV).
"The hearing showed no materia.l reemployment by this industry
subsequent to the effective date of the Code, which contained a
9782
-425-
provision arbitrarily fixing a work week of forty hours. The
forty hour work week of the Cotton Garment Industry Code has
resulted in unfair competition between members of the apparel
industry under it and members under other ap;oarel codes which
have provisions fcr thirty-five and thirty-six hour work weeks.
Section A and B of Article IV provided for the maintaining of
the same weekly wage as. is orovided in the original Code.'
"The Industrial Advisory Board suggests a thirty-eight
hour week instead of thirty-six hours, with a proportionate in-
crease in the basic wage, I believe that the reduction of hours
from forty to thirty-eight would not effectuate the elimination
of unfair comoetition. The Industrial Advisory Board recommend-
ed that the Sheep-Lined and Leather Garment Manufacturers be '
exempted from any hour and wage change owing to the extreme
' season.1 character of their industry. The hour change is subject
.'to modification by the Industrial Committee. The extreme season-
al ch£ ...-acter of these industries is not a sufficient reason for
granting a lower wage rate for these particular items which are
in competition with products of other apparel industries.
"The Legal Division in its memorandum of approval re-
commended that the 'amendments be divided into t"0 grouos, one
which will be inroossed by the President and the other which will
be assented to by the Industry and signed by the Administrator.'
The amendments are so inter-locked that it is considered hot ad-
visable to separate them. The lOfiJ limitation of handicapped work-
ers has been eliminated from the amendment.
"The Research and Planning Division contends that the In-
dustrial Committee established by proposed Amendment V (referred
to as Amendment #7) could grant exemptions from any provisions
of the Code and this would constitute a delegation of an impor-
tant function of the Code Authority without provision for maintain-
ing balanced consideration. The objective sought by this amend-
ment is to establish a method whereby necessary exceptions arid
exemptions may be handled judiciously and with speed. A suf-
ficient check is maintained since not only the Code Authority
has conrolete notice of all actions taken by the Industrial Com-
mittee, three of whose members are nominated by the Code Author-
ity itself, but also the Administrator has reserved the right of
disapproval within five days before its rulings become effective,
subject thereafter to the further order of the Administrator.
"The comment concerning exceptions which may be granted by
the Industrial Committee in case of undue hardship up to forty
hours has been considered and this -oower of exception is in-
cluded in Section A of Article III.
''"o material changes were made in the amendments since the
receiot of the approval and renorts of the various Advisory 3oards,
the Legal and Research and Planning Divisions and the Letter of
Assent of the Code Authority.
9732
-426-
"I analyze said amendments and find as set forth in the en-
closed draft of a letter bo be transmitted "by you to the Pres-
ident said analysis and findings being incorporated herein "by
reference. Said amendments are accordingly recommended for your
approval." (*)
IV. Effects of Amendment Ho, 7
A - 36^mrJJeek as of October 1 , 1934, Ap-oroved for Cotton
G- ar m e n t I n du s t ry .
On August 21. 1934. this amendment was officially approved, plac-
ing the Cotton Garment Industry (as of October 1, 19341 on a 36-hour
week basis, rith minimum weekly wage rates of $12.00 in the South and
$13»00 in the North, and raising the piece rates by not less than 10$.
This equalization of hours, and corresponding increase in Cotton
Garnjenti Code minimum wages, should have been a most important factor
in the settlement of the unfair competitive situation on pants and
wash suits r for it was estimated that the difference in wages paid to
operators under tne Clothing Code ar.d under the Cotton Garment Code
(except for cutters and pressers) no:; only amounted to 2/3 of 1 cent
per hour in the South and 8/9 of 1 cent in the North.
See Memorandum from Burton E- Oppenheim to H. D. Vincent, dated
April 17, 1935 (copy of which will be found on page 194 of this Ap-
pendix, )
3. Two Stays Issued. Delaying Effective Date to Dec, l t 1934 .
However, due to the flood of protests and objections from the
Cotton Garment Industry, including an injunction suit filed by a group
of manufacturers seeking to restrain the National Recovery Administra-
tion from enforcing the 36-hour wee 1 -, the Administration on September
28, 1934, issued Administrative Order No, 113-132, staying tne wage and
hour provisions of the new amendment until October 15, 1934, and on
October 12, 1934, issued a further Order (No. 118-135) staying these
provisions until December 1, 1934„
Therefore the net result was actually no real improvement in
this jurisdictional conflict during this whole period.
(*) Letter dated August 8, 1934, to General Hugh S. Johnson,
Administrator, from Dean G. Edwards, Deputy Administrator, ap-
proval recommended by William P. Farnsworth, Acting Division Admin-
istrator. (Cotton Garment Code files, under Amendment No. 7.)
9782.
-427-
CHAPTER 711
DEVELOPMENTS FHOk AIvIElID.'iE'.'T IIP. 7 TO SUP3E'IE COURT
DECISION. MAY 37, 1935 .
I. Progress Up To December 1, 1934.
A. Corre spondence re Overlap Settlement (in September )
Deputy Administrator Morris Greenberg was spending the major portion
of his time on this particular problem, and as a result of his suggestion,
Deputy Administrator 3urton E. Oppenheim, now in direct charge of this
overlapping conflict, write on September 15, 1934, to Col. P. 3. Paddock,
of the Cottc i Garment Code Authority, and George L. Bell, of the Men's
Clothing Coi" b Authority, as follows:
"It has been suggested that the conflict over jurisdiction
over the manufacture of pants be settled by a decision
along the following lines:
"All pants made in clothing factories shall be subject to
the Men's Clothing Code; all wool and part wool pants and
any cotton pants made in conjunction with \vool or part
wool pants shall be made under the Men's Clothing Code;
all cotton pants not made in conjunction with wool or
part wool pants shall be made under the Cotton Garment
Code.
"I would like to have your comments on this matter as
quickly as possible." (*)
Colonel Paddock replied as follows:
"This will acknowledge receipt of your letter of
September .i rh, in reference tc a conflict over juris-
diction in the manufacture cf o-nts.
"The solution as suggested in your letter is now being
taken up with the members of this Industry, and I will give
you a decision i as quickly as possible.
"In this connection we would like to call your attention
to the r nesiuer t which was finally reached after much
controvc v.- n the Cotton Textile Industry and the
Woolen T.xtJie " py i reference to the over-lap of
the various types of fabrics manufactured by both If
you will review this compromise and. agreement you will
(*) Letter dated September 15, 1934, to Colonel P. 3. Paddock,
~::ecutive Director, Cotton Garment Code Authority, from
Burton E. Oppenheim, Assistant Deputy Administrator.
(Cotton Garment Code files).
9782
-428-
discover that the same fabrics uoon which this agreement
was reached represent those fabrics that are used respec-
tively in the Lien's Clothing Go e and in the Cotton Garment
Code, Please also note that the wool-back and other similar
fabrics, and other low-grade fabrics renrer-ent those which
are employed in our Industry in the manufacture of work
clothes, and it would seem that an ad cm t ion of this agree-
ment above referred to could be well made to apioly to the
controversy existing between our Industry and the Clothing
Code, in reference to raan"bs. Please give me your reactions
on this matter." (*)
However, the Cotton Garment Code Authority a-roarently took no
action whatsoever on the proposal, as Derraty Administrator O-nmenheim,
on October 29, 1934, wrote Colonel Paddock again, as follows:
"Some time ago I submitted to you a proposed ruling to
be issued by the Administration in the matter of juris-
diction over the manufacture of cotton and wool pants.
You were to confer with members of the Code Authority
who were interested in this matter and advise me con-
cerning the same.
"I believe that this r>rcr>osed order should settle the
matter in a very fair manner and I also feel that any
order disposing of this question should be issued t>rior
to December I so that necessary adjustments by the manu-
facturers can be made before that time and the matter
settled concurrently with the wage increase which will
go into effect on December 1.
"While I should be very glad to discuss this at greater
length, I must noint out that it is necessary to act
promptly on this situation. Therefore, unless I hear
from ycu to the contrary, I will assume the t this arrange-
ment is satisfactory to you .and will, oroceed accordingly." (**)
3 . Order Suggest ed by Deputy Adm inis trato r Greenberg ,
October 1 2, 1934 .
Then, on October 12, 1934, Derruty Administrator Greenberg sub-
mitted a report, recommendation, and suggested Order, as follows:
(*) Letter dated September IS, 1934, to Burton E. Ormenheim,
Assistant Derraty Administrator, from Col. R, 3. Paddock,
Executive Director, Cotton Garment Code Authority. (Cotton
Garment Code files).
(**) Letter dated October 29, 1934, from Burton E. Ormenheim,
Arsistant Deputy Administrator, to 'R. 3. Paddock, Executive
Director, Cotton Garment Code Authority. (Cotton Garment
Code files)..
9782
~ 130-
" If grouu (a) returned to their former status of strictly-
one r>ants suit an'" overcoat . : ii r >1 octurers, there would
be no problem bet oen (t ) and (o).
"If group (t) could be brought oack to the long estab-
lislied practice of confining the main product ion to
woolen trousers, the placJ roui (b) in the lien's
Clothing Code might solve bh 3 situation by putting
woolen production under the i'.ten's Clothing Code and
cotton production under the Cotton, Garment Code.
"Within the last ten years grout) (a) by entering into
the production of two -oants suits and the by-nroduct of
single nants has absorbed a certain outlet that the
special dress pants manufacturer formerly enjoyed.
Therefore, group 1'b) was forced to enter into the -oro-
ducticn of ether products anj naturally turned to cot-
ton rants and slacks foi sum ier nd sport near. Grouo
(a) must, therefore, as same its share of the responsi-
bility for the present condition and take its share of
the consequences.
"Many of the manufacturers in group (c) known by general
classification as work clothing manufacturers have in
the past con years been forced by developments within
this period into further dive . ng cheir lines and
within che controlling elements of their methods of nro-
duction and distribution have made not only wash pants
and slacks for sunnier and sriort wear but also a small
oer' cent of woolen '-ants.
"To arbitrarily ley do^n the natural line of demarcation
between wollen and cotton will not cure the ccmnetitive
condition and will not force the raeaufacturers back into
their old confined lines of production because the effect
of the developments in the lasl t' i ears are more force-
ful than any provisions given the ei"iect of law in a
Code if those provisions are contrary to and do not take
into consideration these developments. The effect would
be to make such orovisions unworkable, unrecognized and
unenforceable.
"It would, therefore, be more advisable and uracticable
to recognize conditions as they are, equalize the com-
petitive situation between the three grouos from the
standpoint of labor costs and provide that the two groups
(b) and (c) which are highly competi tive from the stand-
point of distribution be governed bj one set of rules
and regulations as far as Cede of Fair Competition is
concerned.
"Due to the fact that the larger nortion of the uroduc-
ticn of grouns (b) and (c) is from cotton fabrics and
made for occasional and utility outerwear, grouos (b)
9782
-429-
(Report of Morris Greenberg)
"We have three positions to be reconciled.
"(a) Manufacturers operating under the Men's Clothing
Code — that is, the manufacturer '"ho makes men's suits,
two pants suit, and off trousers as a by-provudt all
within the same organization.
"(h) The heretofore so-called exclusively dress -oants
manufacturers ^ho make a fairly large per cent of their
production in wool trousers of the so-called better
grade and also make a large per cent of their production
in better grade cotton wash -nants, knickers, for more
or less snort wear and who also make corduroy and other
cotton slacks.
"(c) The manufacturers of so-called work pants and
medium priced pants almost entirely ouf of cotton and
in addition makes cotton wash pants, corduroy slacks,
other trousers suitable for sport and summer "ear be-
sides a general line of work clothing.
"Group (b) enters into competition with group (a) with
a finer grade wollen trouser. Group (b) also enters
into competition with group (c) in the manufacturing
and distribution of cotton wash pants, corduroy slacks,
etc., for sport and summer wear. Group (c) does not en-
ter into competition with group (a) although group (c)
does produce and manufacture a small per cent of woolen
trousers.
"What do the various groups want?
"Group (a) desires to bring group (b) under the Men's
Clothing Code because of the woolen •nants production.
Group (b) desires to operate under the Cotton Garment
Code Vacause of their l^r-^e percentage of cotton pants
production, Group (b) also desires to eliminate group
(c) entirely from the production of woolen pants.
Group (b) further desires that if it is brought under
the Men's Clothing Code to force, if it can, all grout)
(c) under the same regulations. Group (c) whose pro-
duction is chiefly cotton, desires to remain under the
Cotton Garment Code and for a further reason many in
group (c) also include in their Production other types
cf garments and pants, such types coming under the
jurisdiction of the Cotton Garment Code.
"The competitive situation between the three groups
must be equalized as far as any unfair conditions exist.
Further, the confusion caused by a manufacturer operat-
ing under t'"0 or more Codes must be eliminated.
9782
-431-
and (c) is from cotton fabrics and made for occasional and
utility outerwear, groups (b) and (c) should be governed by
the Cotton Garment Code. A plan of equalizing labor costs
of groups (a) and (b) and (c) with the so-called men' s
clothing manufacturers is outlined herewith. This plan per-
haps with minor variations should satisfy all parties con-
cerned if competitive interest of the manufacturers and mu-
tual interest of labor govern the arriving at a final equitable
decision.
• "Men's Pants Classification
Suggested Differentials
"Cutters and Pressers
1 - Manufacturers on 100$ cotton production — Cotton
Garment rates (*)
2 - Manufacturers having up to 10^ wool production
South - Minimum $14.00
Eorth - " $15.00
(Pro-rated on present minimum rates of both Codes)
3 - Manufacturers having over 10$ wool production and
up to 50 c ,a
Operate at 75$ of Men's Clothing Code for wages,
Cotton Garment Code for hours.
4 - Manufacturers whose production is 50$ or above
operate at Men's Clothing Code rates.
"Operators
1 - Manufacturers on 100$ cotton production — Cotton
Garment rates (**)
2 - Manufacturers having up to 10$ wool production
Cotton production - South $12.00 per 36-hour week
North $13,00 per 36-hour week
"tfool production - Same as Men's Clothing Code
for wages, Cotton Garment
Code for hours.
3 - Manufacturers whose production is 10$ and above (wool)
All production on the basis of Men's Clothing
Code rates (***)
(*) Por hours and wages
(**) Por hours and wages
(***) Por hours and wages
9782
-432-
" Manufacturing Emp loyees Classified as Exami ners ,
Bundiers and Sorters (excluding Trimmers) -
Workers Not Usual ly on Piece Hates
1 - Manufacturers on 100*3 cotton -production — Cotton
Garment Code rates (*)
2 - Manufacturers having u^ to 10a wool production
All production on the basis of South $12.00
North $13.00
3 - Manufacturers whose -production is 10*3 wool -nroduction
and above
All production on the "basis of Men's Clothing
Code rates (**)
"Suggested Clauses to be Covered in the Executive Order.
1 - That the manufacturer shall keep his records in such
a manner that the Code Authority may readily determine at
any time his -percentage of wool -pants -production on the
basis of units sold.
2 - That there be used for this -purpose an "F"
label with the title "wool -pants division" stamped
thereon, same to be used on all ^ool or -part wool
■pants.
3 - That within 50 days after the effective date of
this order, every manufacturer of -cants shall report
the approximate percentage of wool or nart wool
pants -production and cotton -pants -production to the
Code Authority for the -purpose of determining what
classification the manufacturer belongs under.
" Order
" Code of Fair Competition
for the
"en's C lo thing Ind v-itry
and
Co tton Garment Industry
"(l) All -pants manufactured in -plants now operating
under the Code of Fair Competition for the Men's
Clotning Industry shall be manufactured under the
terms and provisions of the Men's Clothing Code.
(*) For hours and wages
(**) For hours and wrges
9782
-433-
11 (?) All wool and part wool nants and any cotton
pants made in conjunction therewith in the same shop
shall ,ie made under the terms and provisions of the
Code c .' Fair Conroetition for the Men's Clothing
Indus! r-y.
"(3) All cotton pants not made in the same shop with
wool or part wool pants, or in clothing factories now
o-oerating under the Men's Clothing Code, shall be
made under the terms and provisions of the Code of
Fair Conroetition for the Cotton Garment Industry.
"(4) This order shall become effective thirty (30)
days from the date hereof, during which period all
manufacturers of pants operating under the Cotton
Garment Code shall file with the Administration,
upon notification from the Code Authority of that
Industry, a record of their intention with respect
to the future manufacture of -oants in accordance
with the -orcvisions of this order, and such manu-
facturers shall state whether they will manufacture
wool or t>art wool pants or all cotton -cants in
their plants.
"(5) The wage provisions as to the manufacture of
pants in the Men's Clothing Code are hereby stayed
for a period of sixty '60) days from the date hereof,
as applied to the minimum rates for off-pressers and
cutters, and it is hereby ordered that during this
period the minimum rate for those occupations shall
be 75 tier cent of the wage rate provided for such-
worker' in the Code of Fair Competition for the Men's
Clothi:.g Industry.
"(6) it is further ordered that during this period
a Commission shall hereby be established for the
purpose of investigating the wage scales which shall
apply to off-pressers and cutters and that such Board
shall report to the National Industrial Recovery Board
within sixty (60) days from the date hereof its recom-
mendations as, to the proper wage scries, upon which
recommendations the Nation 
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